File No. 333-47005 CIK #910934
Securities and Exchange Commission
Washington, D. C. 20549
Post-Effective
Amendment No. 1
to
Form S-6
For Registration under the Securities Act of 1933
of Securities of Unit Investment Trusts Registered
on Form N-8B-2
Ranson Unit Investment Trusts Series 66
Name and executive office address of Depositor:
Ranson & Associates, Inc.
250 North Rock Road, Suite 150
Wichita, Kansas 67206
Name and complete address of agent for service:
Robin Pinkerton
Ranson & Associates, Inc.
250 North Rock Road, Suite 150
Wichita, Kansas 67206
( X ) Check box if it is proposed that this filing will become
effective at 2:00 p.m. on April 30, 1999 pursuant to paragraph (b) of
Rule 485.
<PAGE>
RANSON UNIT INVESTMENT TRUSTS, SERIES 66
Nasdaq-100 Index Trust, Series 3 (a "Trust" or the "Nasdaq-100 Trust") was
formed with the investment objective of obtaining capital appreciation through
investment in a portfolio of equity securities of the companies which comprise
the Nasdaq-100 Index. By investing in substantially all of the common stocks,
in substantially the same proportions, which comprise the Nasdaq-100 Index, the
Trust seeks to produce investment results that generally correspond to the price
and yield performance of the equity securities represented by the Nasdaq-100
Index over the term of the Trust. See "The Trust Portfolios." The Trust is not
sponsored, endorsed or promoted by or affiliated with The Nasdaq Stock Market,
Inc. or the National Association of Securities Dealers, Inc. There is, of
course, no assurance that the Trust will achieve its objective.
S&P REIT Index Trust, Series 1 (a "Trust" or the "S&P REIT Trust") was formed
with the investment objective of obtaining capital appreciation and income
through investment in a portfolio of equity securities of companies which
comprise the Standard & Poor's REIT Composite Index (the "S&P REIT Index"). By
investing in substantially all of the common stocks, in substantially the same
proportions, which comprise the S&P REIT Index, the Trust seeks to produce
investment results that generally correspond to the price and yield performance
of the equity securities represented by the S&P REIT Index over the term of the
Trust. See "The Trust Portfolios." The Trust is not sponsored by or affiliated
with Standard and Poor's. There is no assurance that the Trust will achieve its
objective.
Units of the Trusts are not deposits or obligations of, or guaranteed by, any
bank and the Units are not federally insured or otherwise protected by the
Federal Deposit Insurance Corporation and involve investment risk including loss
of principal.
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.
This Prospectus consists of two parts.
This Prospectus Part One may not be distributed unless accompanied by Part Two.
The investor is advised to read and retain this Prospectus for future reference.
THIS PROSPECTUS IS DATED AS OF THE DATE OF PROSPECTUS PART TWO.
<PAGE>
NASDAQ-100(REGISTERED TRADEMARK) INDEX LICENSING AGREEMENT
The Sponsor has entered into a license agreement with The Nasdaq Stock Market,
Inc. (the "License Agreement"), under which the Nasdaq-100 Trust (through the
Sponsor) is granted licenses to use the trademark and tradenames "Nasdaq,"
"Nasdaq-100," and "Nasdaq-100 Index" solely in materials relating to the
creation and issuance, marketing and promotion of such Trust and in accordance
with any applicable federal and state securities law to indicate the source of
the Nasdaq-100 Index as a basis for determining the composition of such Trust's
portfolio. As consideration for the grant of the license, the Nasdaq-100 Trust
will pay to The Nasdaq Stock Market, Inc. an annual fee equal to that amount
described under "Expenses of the Trusts." If the Nasdaq-100 Index ceases to be
compiled or made available or the anticipated correlation between Nasdaq-100
Trust and the Nasdaq-100 Index is not maintained, the Sponsor may direct that
such Trust continue to be operated using the Nasdaq-100 Index as it existed on
the last date on which it was available or may direct that the Trust Agreement
be terminated (see "Administration of the Trusts-Amendment and Termination").
Neither the Nasdaq-100 Trust nor the Unitholders are entitled to any rights
whatsoever under the foregoing licensing arrangements or to use any of the
covered trademarks or to use the Nasdaq-100 Index, except as specifically
described herein or as may be specified in the Trust Agreement.
The Nasdaq-100 Trust is not sponsored, endorsed, sold or promoted by The Nasdaq
Stock Market, Inc. (including its affiliates) (the "Corporations"). The
Corporations have not passed on the legality or suitability of, or the accuracy
or adequacy of descriptions and disclosures relating to, the Trust or Units of
the Nasdaq-100 Trust. The Corporations make no representation or warranty,
express or implied to the owners of Units of the Nasdaq-100 Trust or any member
of the public regarding the advisability of investing in securities generally or
in Units of such Trust particularly or the ability of the Nasdaq-100 Index to
track general stock market performance. The Corporations' only relationship to
the Sponsor ("Licensee") and the Nasdaq-100 Trust is in the licensing of certain
trademarks, service marks, and trade names of the Corporations and the use of
the Nasdaq-100 Index which is determined, composed and calculated by Nasdaq
without regard to the Licensee, the Nasdaq-100 Trust or Unitholders of such
Trust. Nasdaq has no obligation to take the needs of the Licensee or the owners
of the Trust into consideration in determining, composing or calculating the
Nasdaq-100 Index. The Corporations are not responsible for and have not
participated in the determination of the timing of, prices at, or quantities of
the Units of the Nasdaq-100 Trust to be issued or in the determination or
calculation of the equation by which the Units of such Trust are to be converted
into cash. The Corporations have no liability in connection with the
administration or operations of the Nasdaq-100 Trust, marketing or trading of
Units of such Trust.
THE CORPORATIONS DO NOT GUARANTEE THE ACCURACY AND/OR UNINTERRUPTED CALCULATION
OF THE NASDAQ-100 INDEX OR ANY DATA INCLUDED THEREIN. THE CORPORATIONS MAKE NO
WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY LICENSEE, OWNERS
OF UNITS OF THE NASDAQ-100 TRUST, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF
THE NASDAQ-100 INDEX OR ANY DATA INCLUDED THEREIN. THE CORPORATIONS MAKE NO
EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIM ALL WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE
NASDAQ-100 INDEX OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE
FOREGOING, IN NO EVENT SHALL
2
<PAGE>
THE CORPORATIONS HAVE ANY LIABILITY FOR ANY SPECIAL, PUNITIVE, INDIRECT, OR
CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS), EVEN IF NOTIFIED OF THE
POSSIBILITY OF SUCH DAMAGES.
THE TRUST FUNDS
Ranson Unit Investment Trusts, Series 66 (the "Fund") includes separate
underlying unit investment trusts designated as Nasdaq-100 Index Trust, Series 3
and S&P REIT Index Trust, Series 1 (the "Trusts"). The Fund was created under
the laws of the State of New York pursuant to a trust indenture (the "Trust
Agreement") dated the Initial Date of Deposit between Ranson & Associates, Inc.
(the "Sponsor") and The Bank of New York (the "Trustee").*
The Nasdaq-100 Trust contains common stocks issued by substantially all of the
companies which comprise the Nasdaq-100 Index. The S&P REIT Trust contains
common stocks issued by substantially all of the companies which comprise the
S&P REIT Index. As used herein, the term "Securities" means the common stocks
(including contracts for the purchase thereof) initially deposited in each Trust
and described in the related portfolio and any additional common stocks acquired
and held by each Trust pursuant to the provisions of the Trust Agreement.
On the Initial Date of Deposit, the Sponsor delivered to the Trustee Securities
or contracts for the purchase thereof for deposit in the Trusts. The Sponsor
intends to maintain a Trust portfolio which duplicates, to the extent
practicable, the weightings of stocks which comprise the related stock index.
The Sponsor anticipates that each Trust will comprise the stocks in the related
stock index in substantially the same weightings as in such index. In
connection with any deposit of Securities, purchase and sale transactions will
be effected in accordance with computer program output showing which Securities
are under- or over-represented in each Trust portfolio. Neither the Sponsor nor
the Trustee will exercise any investment discretion in connection with such
transactions. Precise duplication of the relationship among the Securities in
the related stock index may not be achieved because it may be economically
impracticable or impossible to acquire very small numbers of shares of certain
stocks and because of other procedural policies of the Trusts, but correlation
between the performance of the related stock index and each Trust portfolio is
expected to be between .97 and .99.
By investing in substantially all of the common stocks, in substantially the
same proportions, which comprise the related stock index, each Trust seeks to
produce investment results that generally correspond to the price and yield
performance of the equity securities represented by such index over the term of
such Trust. Due to various factors discussed below, there can be no assurance
that this objective will be met. An investment in Units of a Trust should be
made with an understanding that each Trust includes payments of sales charges,
fees and expenses which may not be considered in public statements of the total
return of the related stock index.
Subsequent to the Initial Date of Deposit, the Sponsor may deposit additional
Securities in a Trust, contracts to purchase additional Securities along with
cash (or a bank letter of credit in lieu of cash) to pay for such contracted
Securities or cash (including a letter of credit) with instructions to purchase
additional Securities, maintaining, as closely as practicable the same
proportionate relationship among the Securities in the portfolio as reflected in
the related stock index. Thus, although additional Units will be issued, each
Unit of a Trust will continue to represent approximately a weighting of the then
current components of the related stock index at
- --------------------
* Reference is made to the Trust Agreement and any statement contained herein is
qualified in its entirety by the provisions of the Trust Agreement.
3
<PAGE>
any such deposit. Precise duplication of the relationship among the Securities
in a Trust may not be achieved because it may be economically impracticable as a
result of certain economic factors and procedural policies of a Trust such as
(1) price movements of the various Securities will not duplicate one another,
(2) the Sponsor's current intention is to purchase shares of the Securities in
round lot quantities only, (3) reinvestment of excess proceeds not needed to
meet redemptions of Units may not be sufficient to acquire equal round lots of
all the Securities in a Trust and (4) reinvestment of proceeds received from
Securities which are no longer components of the related stock index might not
result in the purchase of an equal number of shares in any replacement Security.
If the Sponsor deposits cash, existing and new investors may experience a
dilution of their investments and a reduction in their anticipated income
because of fluctuations in the prices of the Securities between the time of the
cash deposit and the purchase of the Securities and because each Trust will pay
the associated brokerage fees. To minimize this effect, each Trust will attempt
to purchase the Securities as close to the Evaluation Time or as close to the
evaluation prices as possible.
Each Trust consists of (a) the Securities listed under the related "Portfolio"
in Part Two as may continue to be held from time to time in such Trust (b) any
additional Securities acquired and held by such Trust pursuant to the provisions
of the Trust Agreement and (c) any cash held in the Income and Capital Accounts
of such Trust. Neither the Sponsor nor the Trustee shall be liable in any way
for any failure in any of the Securities. However, should any contract for the
purchase of any of the Securities initially deposited hereunder fail, the
Sponsor will, unless substantially all of the moneys held in a Trust to cover
such purchase are reinvested in substitute Securities in accordance with the
Trust Agreement, refund the cash and sales charge attributable to such failed
contract to all Unitholders on the next distribution date.
THE TRUST PORTFOLIOS
Each Trust portfolio will consist of as many of the Nasdaq-100 or S&P REIT Index
stocks as is feasible in order to achieve the respective Trust's objective of
attempting to provide investment results that duplicate substantially the total
return of the Nasdaq-100 or S&P REIT Index. Each Trust is expected to be
invested in no less than 95% of the stocks comprising the related index.
Although it may be impracticable for a Trust to own certain of such stocks at
any time, the Sponsor expects to maintain a correlation between the performance
of each Trust portfolio and that of the related index of between .97 and .99.
Adjustments to a Trust portfolio will be made on an ongoing basis in accordance
with the computer program output to match the weightings of the Securities as
closely as is feasible with their weightings in the related index as such Trust
invests in new Securities in connection with the creation of additional Units,
as companies are dropped from or added to such index or as Securities are sold
to meet redemptions. These adjustments will be made on the business day
following the relevant transaction in accordance with computer program output
showing which of the Securities are under- or over-represented in a Trust
portfolio. Adjustments may also be made from time to time to maintain the
appropriate correlation between a Trust and the related index. The proceeds
from any sale will be invested in those Securities which the computer program
indicates are most under-represented in the related portfolio. See "Investment
Supervision."
Due to changes in the composition of the Nasdaq-100 Index and the S&P REIT
Index, adjustments to a Trust portfolio may be made from time to time. It is
anticipated that most of such changes in the Nasdaq-100 Index and the S&P REIT
Index will occur as a result of merger or acquisition activity. In such cases,
a Trust, as a shareholder of an issuer which is the object of such merger or
acquisition activity, will presumably receive various offers from potential
acquirers of the issuer. The Trustee is not permitted to accept any such offers
until
4
<PAGE>
such time as the issuer has been removed from the related index. Since, in most
cases, an issuer is removed from an index only after the consummation of a
merger or acquisition, it is anticipated that the Trusts will generally acquire,
in exchange for the stock of the deleted issuer, the consideration that is being
offered to shareholders of that issuer who have not tendered their shares prior
to that time. Any cash received as consideration in such transactions will be
reinvested in the most under-represented Securities as determined by the
computer program output. Any securities received as consideration which are not
included in the related index will be sold as soon as practicable and will also
be reinvested in the most under-represented Securities as determined by the
computer program output.
In attempting to duplicate the proportionate relationships represented by each
index, the Sponsor does not anticipate purchasing or selling stock in quantities
of less than round lots (100 shares). In addition, certain Securities may not
be available in the quantities specified by the computer program. For these
reasons, among others, precise duplication of the proportionate relationships in
the related index may not be possible but will continue to be the goal of each
Trust in connection with acquisitions or dispositions of Securities. See
"Investment Supervision." As the holder of the Securities, the Trustee will
have the right to vote all of the voting stocks in a Trust portfolio and will
vote such stocks in accordance with the instructions of the Sponsor.
Investors should note that the Trusts are not sponsored, endorsed or promoted by
or affiliated with either The Nasdaq Stock Market, Inc. or Standard & Poor's and
The Nasdaq Stock Market, Inc. and Standard & Poor's make no representation,
express or implied, to the Trusts or Unitholders regarding the advisability of
investing in an index investment or unit investment trusts generally or in the
Trusts specifically or the ability of the indexes to track general stock market
performance.
Although there can be no assurance that such Securities will appreciate in value
over the life of a Trust, over time stock investments have generally out-
performed most other asset classes. However, it should be remembered that
common stocks carry greater risks, including the risk that the value of an
investment can decrease (see "Risk Factors-Certain Investment Considerations"),
and past performance is no guarantee of future results.
THE NASDAQ-100 INDEX
The Nasdaq-100 Index is composed of 100 of the largest non-financial Nasdaq
National Market common stocks. Nasdaq, which represents the fastest growing
stock market in the U.S., is also one of the first fully electronic stock
markets in the world. This modern-day securities market began operations in
1971 and today lists more companies than any other market in the U.S. The
Nasdaq-100 Index is limited to one issue per company. At the time of inclusion
in the Nasdaq-100 Index, index securities must have a minimum market value of at
least $500 million. In the event a security is deleted from the Nasdaq-100
Index, the largest non-financial issue not then in the Nasdaq-100 Index which
meets the applicable criteria will be substituted. The Nasdaq Stock Market,
Inc. has established procedures for, and controls over, substitutions of
securities and may periodically, at its discretion, make changes in component
stocks so that the Index will more accurately reflect the overall composition of
the non-financial sector of The Nasdaq Stock Market. Each security in the
Nasdaq-100 Index is represented by its market capitalization in relation to the
total market value of the Nasdaq-100 Index. Companies are selected using
criteria that includes company trading volume, company visibility, continuity of
the components in the Nasdaq-100 Index, and a good mix of industries represented
on The
5
<PAGE>
Nasdaq Stock Market. Chicago Board Options Exchange, the largest options
exchange in the world, began trading Nasdaq-100 Index options on February 7,
1994. As of March 3, 1999, the Nasdaq-100 Index was comprised of the following
industry sectors: Software (29.3%), Computers (20.4%), Telecommunications
(16.6%), Semiconductors (13.5%), Media (5.3%), Biotechnology (3.9%), Retail
(3.5%), Internet (3.5%), Commercial Services (2.4%) and Electronics (1.6%).
The table below illustrates the characteristics of the average company included
in the Nasdaq-100 Index as of the end of 1998. It is important to note that,
unless provided otherwise, the data included in the table encompasses average
data, not the total data of all companies in the Nasdaq-100 Index and is not
intended to describe or predict the financial data, returns or characteristics
of any company included or to be included in the Nasdaq-100 Index.
<TABLE>
<CAPTION>
FINANCIAL CHARACTERISTICS (MILLIONS) TRADING CHARACTERISTICS (AVERAGES)
- ------------------------------------ ----------------------------------
<S> <C> <C> <C>
Total Assets $ 4,228.5 Share Price $ 68.5
Shareholders' Equity $ 1,989.3 Number of Market Makers 36.8
Total Revenues $ 2,938.8
Net Income $ 239.5
Shares Outstanding 224.8
Market Value of Shares Outstanding $15,407.7
P/E Ratio for Total Index(a,b) 64.3
<FN>
- --------------------
(a) Total market value divided by total earnings
(b) These figures represent total data for all index companies.
</TABLE>
The following table depicts the Year-End Index Value for the Nasdaq-100 Index
from inception (February 1, 1985) through December 31, 1998. The formula used
in calculating the Nasdaq-100 Index Level is described below. The table uses
data that is adjusted to reflect that the Nasdaq-100 Index level was halved on
January 3, 1994, and does not reflect reinvestment of dividends. Investors
should note that the figures below represent past performance of the Nasdaq-100
Index and not the future performance of the Nasdaq-100 Index or the Nasdaq-100
Trust (which includes certain fees and expenses). Past performance is, of
course, no guarantee of future results.
6
<PAGE>
<TABLE>
<CAPTION>
YEAR-END ANNUAL RETURN
INDEX (EXCLUDING
YEAR VALUE DIVIDENDS)
- ---- -------- -------------
<S> <C> <C>
February 1, 1985 125.00 -
1985 132.30 5.84%
1986 141.41 6.89%
1987 156.25 10.50%
1988 177.41 13.54%
1989 223.84 26.17%
1990 200.53 (10.41)%
1991 330.86 64.99%
1992 360.19 8.86%
1993 398.28 10.58%
1994 404.27 1.50%
1995 576.23 42.54%
1996 821.36 42.54%
1997 990.80 20.63%
1998 1,836.01 85.31%
Total Return Since Inception 1,368.81%
</TABLE>
Because the Nasdaq-100 Trust is sold to the public at net asset value plus the
applicable sales charge, and the expenses of such Trust are deducted before
making distributions to Unitholders, investment in such Trust would have
resulted in investment performance to Unitholders somewhat reduced from that
reflected in the above table.
The Nasdaq-100 Index is market value weighted. The representation of each
security in the Nasdaq-100 Index is proportional to its last sale price times
the total number of shares outstanding, in relation to the total market value of
the Nasdaq-100 Index. The level of the Nasdaq-100 Index is calculated as
follows:
Nasdaq-100 Index Level = Current Market Value X 125
--------------------
Adjusted Base Period
Market Value
Adjusted Base Period = Current Market Value X Previous Base
After Adjustments Period Market Value
--------------------
Current Market Value
Before Adjustments
The numeric value level of the Nasdaq-100 Index was established at 250 prior to
the opening of the market on February 1, 1985. The Nasdaq-100 Index value was
halved at the end of 1993. The level of the Nasdaq-100 Index will only change
as a result of the price changes occurring between the opening and closing of
the market. Adjustments for securities being added to or deleted from the
Nasdaq-100 Index, or capitalization changes of adjustments, will take place
during the system maintenance process which occurs after the market has closed.
These adjustments will result in value changes to the current market value and
adjusted base period market value, but will not in and of themselves alter the
level of the Nasdaq-100 Index.
7
<PAGE>
The Nasdaq-100 Index is also adjusted to account for stock splits and stock
dividends during the system maintenance process. The system makes a price
adjustment, however, to account for the increased number of shares outstanding
from such an action with the result being that the current market value does not
change.
In case of cash dividends other than extraordinary dividends, no system
adjustment is made. The Nasdaq-100 Index formula relies on market forces to
determine the level of the Nasdaq-100 Index. Neither the current market value
nor the adjusted base period market value are adjusted to reflect ordinary cash
dividends. At its discretion, The Nasdaq Stock Market, Inc. may temporarily
suspend Nasdaq-100 Index securities from the calculation of the Nasdaq-100 Index
or adjust the Nasdaq-100 Index divisor in those instances where an unusual cash
dividend or spin-off might unduly influence the level of the Nasdaq-100 Index.
The Nasdaq Stock Market, Inc. disseminates calculations of the Nasdaq-100 Index
via Level 2 and Level 3 Nasdaq service and makes the Index calculation available
to information vendors and the print media.
THE S&P REIT INDEX
The S&P REIT Index currently consists of 101 REITs. The component stocks are
selected by identifying the total REIT population and applying a screening
process which eliminates REITs if the REIT (1) is below the 70th percentile in
terms of market capitalization, (2) is not listed on the New York Stock
Exchange, American Stock Exchange or Nasdaq Stock Market, (3) has a share price
of less than $1, (4) did not pay dividends the previous fiscal year, (5) had
more than three no-trade days in the previous 12 months and (6) has less than a
two-month trading history since its initial public offering. This screening
process also considers the liquidity ratio, targets REIT property-type
representation and includes a strict fundamental analysis seeking a strong level
of earnings performance and eliminating REITs with liquidation features. This
screening process initially produced 128 candidates covering approximately 85-
90% of the total REIT market value. Each of these REITs had a market
capitalization of over $100 million. S&P selected REITs in the three broad
categories (Equity, Mortgage and Hybrid) allocated across different property
types. As of April 26, 1999, this sector diversification was as follows:
Apartments-19.99%, Diversified-10.01%, Health Care-6.25%, Hotel/Restaurant-
5.04%, Manufactured Homes-1.78%, Mortgage-0.15%, Office Property-23.83%, Outlet
Centers 1.16%, Regional Malls-7.48%, Shopping Centers-11.94%, Storage-4.71%,
Warehouse/Industrial-6.60% and Whole Loans-1.06%. The base value of the index
was set at 100 on December 31, 1996, and a ten-year history was compiled.
The S&P REIT Trust has entered into a license agreement with Standard & Poor's
(the "License Agreement"), under which such Trust is granted licenses to use the
trademark and tradename "S&P REIT" and other trademarks and tradenames, to the
extent the Sponsor deems appropriate and desirable under federal and state
securities laws to indicate the source of the index as a basis for determining
the composition of such Trust's portfolio. As consideration for the grant of
the license, the S&P REIT Trust will pay to Standard & Poor's an annual fee
equal to .02% of the average net asset value of such Trust (or, if greater,
$10,000). The License Agreement permits the S&P REIT Trust to substitute
another index for the S&P REIT Index in the event that Standard & Poor's ceases
to compile and publish that index. In addition, if the index ceases to be
compiled or made available or the anticipated correlation between the S&P REIT
Trust and the index is not maintained, the Sponsor may direct that such Trust
continue to be operated using the S&P REIT Index as it existed on the last date
on which it was available or may direct that the Trust Agreement be terminated
(see "Administration of the Trusts-Amendment and Termination").
8
<PAGE>
Neither the S&P REIT Trust nor the Unitholders are entitled to any rights
whatsoever under the foregoing licensing arrangements or to use any of the
covered trademarks or to use the S&P REIT Index, except as specifically
described herein or as may be specified in the Trust Agreement.
The S&P REIT Trust is not sponsored, endorsed, sold or promoted by Standard &
Poor's ("S&P"). S&P makes no representation or warranty, express or implied, to
the owners of such Trust or any member of the public regarding the advisability
of investing in securities generally or in such Trust particularly or the
ability of the S&P REIT Index to track general stock market performance. S&P's
only relationship to the Licensee is the licensing of certain trademarks and
trade names of S&P and of the S&P REIT Index which is determined, composed and
calculated by S&P without regard to the Licensee or the S&P REIT Trust. S&P has
no obligation to take the needs of the Licensee or the owners of the S&P REIT
Trust into consideration in determining, composing or calculating the S&P REIT
Index. S&P is not responsible for and has not participated in the determination
of the prices and amount of the S&P REIT Trust or the timing of the issuance or
sale of such Trust or in the determination or calculation of the equation by
which such Trust is to be converted into cash. S&P has no obligation or
liability in connection with the administration, marketing or trading of the S&P
REIT Trust.
S&P does not guarantee the accuracy and/or the completeness of the S&P REIT
Index or any data included therein and S&P shall have no liability for any
errors, omissions, or interruptions therein. S&P makes no warranty, express or
implied, as to results to be obtained by the Sponsor, the S&P REIT Trust, any
person or any entity from the use of the S&P REIT Index or any data included
therein. S&P makes no express or implied warranties, and expressly disclaims
all warranties of merchantability or fitness for a particular purpose or use,
with respect to the S&P REIT Index or any data included therein. Without
limiting any of the foregoing, in no event shall S&P have any liability for any
special, punitive, indirect, or consequential damages (including lost profits),
even if notified of the possibility of such damages. "Standard &
Poor's(Registered Trademark)", "S&P(Registered Trademark)", "S&P REIT(Registered
Trademark)", "Standard & Poor's 500", and "500" are trademarks of The McGraw-
Hill Companies, Inc. and have been licensed for use by the S&P REIT Trust. The
S&P REIT Trust is not sponsored, endorsed, sold or promoted by Standard & Poor's
and Standard & Poor's makes no representation regarding the advisability of
investing in such Trust.
RISK FACTORS
General. An investment in Units of a Trust should be made with an understanding
of the risks inherent in an investment in equity securities, including the risk
that the financial condition of issuers of the Securities may become impaired or
that the general condition of the stock market may worsen (both of which may
contribute directly to a decrease in the value of the Securities and thus, in
the value of the Units) or the risk that holders of common stock have a right to
receive payments from the issuers of those stocks that is generally inferior to
that of creditors of, or holders of debt obligations issued by, the issuers and
that the rights of holders of common stock generally rank inferior to the rights
of holders of preferred stock. Common stocks are especially susceptible to
general stock market movements and to volatile increases and decreases in value
as market confidence in and perceptions of the issuers change. These
perceptions are based on unpredictable factors including expectations regarding
government, economic, monetary and fiscal policies, inflation and interest
rates, economic expansion or contraction, and global or regional political,
economic or banking crises.
9
<PAGE>
Holders of common stock incur more risk than the holders of preferred stocks and
debt obligations because common stockholders, as owners of the entity, have
generally inferior rights to receive payments from the issuer in comparison with
the rights of creditors of, or holders of debt obligations or preferred stock
issued by the issuer. Holders of common stock of the type held by the Trusts
have a right to receive dividends only when and if, and in the amounts, declared
by the issuer's Board of Directors and to participate in amounts available for
distribution by the issuer only after all other claims on the issuer have been
paid or provided for. By contrast, holders of preferred stock have the right to
receive dividends at a fixed rate when and as declared by the issuer's Board of
Directors, normally on a cumulative basis, but do not participate in other
amounts available for distribution by the issuing corporation. Cumulative
preferred stock dividends must be paid before common stock dividends and any
cumulative preferred stock dividend omitted is added to future dividends payable
to the holders of cumulative preferred stock. Preferred stocks are also
entitled to rights on liquidation which are senior to those of common stocks.
Moreover, common stocks do not represent an obligation of the issuer and
therefore do not offer any assurance of income or provide the degree of
protection of capital debt securities. Indeed, the issuance of debt securities
or even preferred stock will create prior claims for payment of principal,
interest, liquidation preferences and dividends which could adversely affect the
ability and inclination of the issuer to declare or pay dividends on its common
stock or the rights of holders of common stock with respect to assets of the
issuer upon liquidation or bankruptcy. Further, unlike debt securities which
typically have a stated principal amount payable at maturity (whose value,
however, will be subject to market fluctuations prior thereto), common stocks
have neither a fixed principal amount nor a maturity and have values which are
subject to market fluctuations for as long as the stocks remain outstanding.
The value of the Securities in the portfolios thus may be expected to fluctuate
over the entire life of a Trust to values higher or lower than those prevailing
on the Initial Date of Deposit.
Whether or not the Securities are listed on a national securities exchange, the
principal trading market for the Securities may be in the over-the-counter
market. As a result, the existence of a liquid trading market for the
Securities may depend on whether dealers will make a market in the Securities.
There can be no assurance that a market will be made for any of the Securities,
that any market for the Securities will be maintained or of the liquidity of the
Securities in any markets made. In addition, a Trust is restricted under the
Investment Company Act of 1940 from selling Securities to the Sponsor. The
price at which the Securities may be sold to meet redemptions and the value of a
Trust will be adversely affected if trading markets for the Securities are
limited or absent.
The Trust Agreement authorizes the Sponsor to increase the size of a Trust and
the number of Units thereof by the deposit of additional Securities, or cash
(including a letter of credit) with instructions to purchase additional
Securities, in such Trust and the issuance of a corresponding number of
additional Units. If the Sponsor deposits cash, existing and new investors may
experience a dilution of their investments and a reduction in their anticipated
income because of fluctuations in the prices of the Securities between the time
of the cash deposit and the purchase of the Securities and because a Trust will
pay the associated brokerage fees. To minimize this effect, the Trusts will
attempt to purchase the Securities as close to the Evaluation Time or as close
to the evaluation prices as possible.
From time to time Congress considers proposals to reduce the rate of the
dividends-received deduction. Enactment into law of a proposal to reduce the
rate would adversely affect the after-tax return to investors who can take
advantage of the deduction. Unitholders are urged to consult their own tax
advisers. Further, at any
10
<PAGE>
time after the Initial Date of Deposit, litigation may be initiated on a variety
of grounds, or legislation may be enacted with respect to the Securities in a
Trust or the issuers of the Securities. There can be no assurance that future
litigation or legislation will not have a material adverse effect on the Trust
or will not impair the ability of issuers to achieve their business goals.
Technology Issuers. Because the Nasdaq-100 Index generally includes a
concentration of technology and technology-related companies, an investment in
Units of the Nasdaq-100 Trust should be made with an understanding of the
characteristics of the technology industry and the risks which such an
investment may entail. Technology companies generally include companies
involved in the development, design, manufacture and sale of computers, computer
related equipment, computer networks, communications systems, telecommunications
products, semiconductors, electronic products, and other related products,
systems and services. The market for technology products is characterized by
rapidly changing technology, rapid product obsolescence, cyclical market
patterns, evolving industry standards and frequent new product introductions.
The success of the issuers of the Securities depends in substantial part on the
timely and successful introduction of new products. An unexpected change in one
or more of the technologies affecting an issuer's products or in the market for
products based on a particular technology could have a material adverse affect
on an issuer's operating results. Furthermore, there can be no assurance that
the issuers of the Securities will be able to respond timely to compete in the
rapidly developing marketplace.
Based on trading history of common stock, factors such as announcements of new
products or development of new technologies and general conditions of the
industry have caused and are likely to cause the market price of technology
common stocks to fluctuate substantially. In addition, technology company
stocks have experienced extreme price and volume fluctuations that often have
been unrelated to the operating performance of such companies. This market
volatility may adversely affect the market price of the Securities and therefore
the ability of a Unitholder to redeem Units at a price equal to or greater than
the original price paid for such Units.
Some key components of certain products of technology issuers are currently
available only from single sources. There can be no assurance that in the
future suppliers will be able to meet the demand for components in a timely and
cost effective manner. Accordingly, an issuer's operating results and customer
relationships could be adversely affected by either an increase in price for, or
an interruption or reduction in supply of, any key components. Additionally,
many technology issuers are characterized by a highly concentrated customer base
consisting of a limited number of large customers who may require product
vendors to comply with rigorous industry standards. Any failure to comply with
such standards may result in a significant loss or reduction of sales. Because
many products and technologies of technology companies are incorporated into
other related products, such companies are often highly dependent on the
performance of the personal computer, electronics and telecommunications
industries. There can be no assurance that these customers will place
additional orders, or that an issuer of Securities will obtain orders of similar
magnitude as past orders from other customers. Similarly, the success of
certain technology companies is tied to a relatively small concentration of
products or technologies. Accordingly, a decline in demand of such products,
technologies or from such customers could have a material adverse impact on
issuers of the Securities.
Many technology companies rely on a combination of patents, copyrights,
trademarks and trade secret laws to establish and protect their proprietary
rights in their products and technologies. There can be no assurance that
11
<PAGE>
the steps taken by the issuers of the Securities to protect their proprietary
rights will be adequate to prevent misappropriation of their technology or that
competitors will not independently develop technologies that are substantially
equivalent or superior to such issuers' technology.
Certain issuers of the Securities may derive a significant amount of business in
foreign markets. Many countries, especially emerging market countries, have
regulatory requirements that differ from U.S. requirements and are characterized
by less developed and more volatile economies. International sales and
operations are subject to certain risks, including unexpected changes in
regulatory environments, exchange rates, tariffs and other barriers, political
and economic instability and potentially adverse tax consequences. All of these
factors could have a material adverse impact on the financial condition of
certain issuers.
REITs. An investment in the S&P REIT Trust should be made with an understanding
of the risks inherent in an investment in REITs specifically and in real estate
generally (in addition to securities market risks). REITs are financial
vehicles that have as their objective the pooling of capital from a number of
investors in order to participate directly in real estate ownership or
financing. REITs are generally fully integrated operating companies that have
interests in income-producing real estate. REITs are differentiated by the
types of real estate properties held and the actual geographic location of
properties and fall into two major categories: Equity REITs emphasize direct
property investment, holding their invested assets primarily in the ownership of
real estate or other equity interests, while Mortgage REITs concentrate on real
estate financing, holding their assets primarily in mortgages secured by real
estate. REITs obtain capital funds for investment in underlying real estate
assets by selling debt or equity securities in the public or institutional
capital markets or by bank borrowings. Thus, the returns on common equities of
the REITs in which the Trust invests will be significantly affected by changes
in costs of capital and, particularly in the case of highly "leveraged" REITs
(i.e., those with large amounts of borrowings outstanding), by changes in the
level of interest rates. The objective of an Equity REIT is to purchase income-
producing real estate properties in order to generate high levels of cash flow
from rental income and a gradual asset appreciation, and they typically invest
in properties such as office, retail, industrial, hotel and apartment buildings
and healthcare facilities. The objective of a Mortgage REIT is to invest
primarily in mortgages secured by real estate in order to generate cash flow
from payments on the mortgage loans.
REITs are a creation of the tax law. REITs essentially operate as a corporation
or business trust with the advantage of exemption from corporate income taxes
provided the REIT satisfies the requirements of Sections 856 through 860 of the
Internal Revenue Code. The major tests for tax-qualified status are that the
REIT (i) be managed by one or more trustees or directors, (ii) issue shares of
transferable interest to its owners, (iii) have at least 100 shareholders, (iv)
have no more than 50% of its shares held by five or fewer individuals, (v)
invest substantially all of its capital in real estate related assets and derive
substantially all of its gross income from real estate related assets and (vi)
distribute at least 95% of its taxable income to its shareholders each year. If
any REIT in the S&P REIT Trust's portfolio should fail to qualify for such tax
status, the related shareholders (including the Trust) could be adversely
affected by the resulting tax consequences.
The underlying value of the Securities and the S&P REIT Trust's ability to make
distributions to Unitholders may be adversely affected by changes in the
national, state and local economic climate and real estate conditions (such as
oversupply of, or reduced demand for, space and changes in market rental rates),
perceptions of prospective tenants of the safety, convenience and attractiveness
of the properties, the ability of the owner to provide adequate management;
maintenance and insurance, the ability to collect on a timely basis
12
<PAGE>
all rents from tenants, tenant defaults, the cost of complying with the
Americans with Disabilities Act, increased competition from other properties,
obsolescence of properties, changes in the availability, cost and terms of
mortgage funds, the impact of present or future environmental legislation and
compliance with environmental laws, the ongoing need for capital improvements,
particularly in older properties, changes in real estate tax rates and other
operating expenses, regulatory and economic impediments to raising rents,
adverse changes in governmental rules and fiscal policies, dependency on
management skills, civil unrest, acts of God, including earthquakes and other
natural disasters (which may result in uninsured losses), acts of war, adverse
changes in zoning laws, and other factors which are beyond the control of the
issuers of the REITs in the S&P REIT Trust.
The value of the REITs may at times be particularly sensitive to devaluation in
the event of rising interest rates. Equity REITs are less likely to be affected
by interest rate fluctuations than Mortgage REITs and the nature of the
underlying assets of an Equity REIT may be considered more tangible than that of
a Mortgage REIT. Equity REITs are more likely to be adversely affected by
changes in the value of the underlying property it owns than Mortgage REITs.
The Clinton Administration's proposed budget for fiscal year 1999 includes four
proposals affecting REITs. These proposals, if enacted, would place additional
restrictions on the structure of certain REITs, limit a REIT's permissible
investments, and affect the taxation of "built-in gains." The Sponsor is unable
to predict whether such proposals or future proposals will be enacted or what
impact such proposals or future proposals, if any, will have on the Securities
included in the S&P REIT Trust.
REITs may concentrate investments in specific geographic areas or in specific
property types, i.e., hotels, shopping malls, residential complexes, and office
buildings. The impact of economic conditions on REITs can also be expected to
vary with geographic location and property type. Investors should be aware that
REITs may not be diversified and are subject to the risks of financing projects.
REITs are also subject to defaults by borrowers, self-liquidation, the market's
perception of the REIT industry generally, and the possibility of failing to
qualify for pass-through of income under the Internal Revenue Code, and to
maintain exemption from the Investment Company Act of 1940. A default by a
borrower or lessee may cause the REIT to experience delays in enforcing its
rights as mortgagee or lessor and to incur significant costs related to
protecting its investments. In addition, because real estate generally is
subject to real property taxes, the REITs in the S&P REIT Trust may be adversely
affected by increases or decreases in property tax rates and assessments or
reassessments of the properties underlying the REITs by taxing authorities.
Furthermore, because real estate is relatively illiquid, the ability of REITs to
vary their portfolios in response to changes in economic and other conditions
may be limited and may adversely affect the value of the Units. There can be no
assurance that any REIT will be able to dispose of its underlying real estate
assets when advantageous or necessary.
The issuer of REITs generally maintains comprehensive insurance on presently
owned and subsequently acquired real property assets, including liability, fire
and extended coverage. However, certain types of losses may be uninsurable or
not be economically insurable for local risks to which the REITs may be
susceptible. There can be no assurance that insurance coverage will be
sufficient to pay the full current market value or current replacement cost of
any lost investment. Various factors might make it impractical to use insurance
proceeds to replace a facility after it has been damaged or destroyed. Under
such circumstances, the insurance proceeds received by a REIT might not be
adequate to restore its economic position with respect to such property.
13
<PAGE>
Under various environmental laws, a current or previous owner or operator of
real property may be liable for the costs of removal or remediation of hazardous
or toxic substances on, under, or in such property. Such laws often impose
liability whether or not the owner or operator caused or knew of the presence of
such hazardous or toxic substances and whether or not the storage of such
substances was in violation of a tenant's lease. In addition, the presence of
hazardous or toxic substances, or the failure to remediate such property
properly, may adversely affect the owner's ability to borrow using such real
property as collateral. No assurance can be given that one or more of the REITs
in the Trust may not be presently liable or potentially liable for any such
costs in connection with real estate assets they presently own or subsequently
acquire while such REITs are held in the S&P REIT Trust.
FEDERAL TAX STATUS
Each Trust has elected and intends to qualify on a continuing basis for special
federal income tax treatment as a "regulated investment company" under the
Internal Revenue Code of 1986, as amended (the "Code"). If a Trust so qualifies
and timely distributes to Unitholders 90% or more of its taxable income (without
regard to its net capital gain, i. e., the excess of its net long-term capital
gain over its net short-term capital loss), it will not be subject to Federal
income tax on the portion of its taxable income (including any net capital gain)
that it distributes to Unitholders. In addition, to the extent a Trust timely
distributes to Unitholders at least 98% of its taxable income (including any net
capital gain), it will not be subject to the 4% excise tax on certain
undistributed income of "regulated investment companies." Because each Trust
intends to timely distribute its taxable income (including any net capital
gain), it is anticipated that neither Trust will be subject to Federal income
tax or the excise tax.
Distributions to Unitholders of a Trust's income, other than distributions which
are designated as capital gain dividends, will be taxable as ordinary income to
Unitholders, except that to the extent that distributions to a Unitholder in any
year exceed a Trust's current and accumulated earnings and profits, they will be
treated as a return of capital and will reduce the Unitholder's basis in his
Units and, to the extent that they exceed his basis, will be treated as a gain
from the sale of his Units as discussed below. Distributions in partial
liquidation reflecting the proceeds of prepayments, redemptions, maturities
(including monthly mortgage payments of principal) or sales of Securities
(exclusive of net capital gain) will not be taxable to Unitholders of such Trust
to the extent that they represent a return of capital for tax purposes. The
portion of distributions which represents a return of capital will, however,
reduce a Unitholder's basis in his Units, and to the extent they exceed the
basis of his Units will be taxable as a capital gain. Although distributions
generally will be treated as distributed when paid, distributions declared in
October, November or December, payable to Unitholders of record on a specified
date in one of those months and paid during January of the following year will
be treated as having been distributed by the Trust (and received by the
Unitholders) on December 31 of the year such distributions are declared.
Distributions of the Trust's net capital gain which are properly designated as
capital gain dividends by the Trust will be taxable to Unitholders as long-term
capital gain, regardless of the length of time the Units have been held by a
Unitholder. A Unitholder may recognize a taxable gain or loss if the Unitholder
sells or redeems his Units. Any gain or loss arising from (or treated as
arising from) the sale or redemption of Units will generally be a capital gain
or loss, except in the case of a dealer or a financial institution. The
Internal Revenue Service Restructuring and Reform Act of 1998 (the "1998 Tax
Act") provides that for taxpayers other than corporations,
14
<PAGE>
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 generally subject to a maximum marginal stated tax rate of 20%
(10% in the case of certain taxpayers in the lowest tax bracket). Capital gain
or loss is long-term if the holding period for the asset is more than one year,
and is short-term if the holding period for the asset is one year or less. The
date on which a Unit is acquired (i.e., the "trade date") is excluded for
purposes for determining the holding period of the Unit. Capital gains realized
from assets held for one year or less are taxed at the same rates as ordinary
income. Note that if a Unitholder holds Units for six months or less and
subsequently sells such Units at a loss, the loss will be treated as a long-term
capital loss to the extent that any long-term capital gain distribution is made
with respect to such Units during the six-month period or less that the
Unitholder owns the Units.
The 1997 Act includes other provisions that treat certain other 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.
In addition, it should be noted that capital gains may be recharacterized as
ordinary income in the case of certain financial transactions that are
"conversion transactions" effective for transactions entered into after April
30, 1993. Unitholders and prospective investors should consult with their tax
advisers regarding the potential effect of this provision on their investment in
Units.
Distributions which are taxable as ordinary income to Unitholders will
constitute dividends for federal income tax purposes. When Units are held by
corporate Unitholders, Nasdaq-100 Trust distributions may qualify for the 70%
dividends-received deduction, subject to the limitations otherwise applicable to
the availability of the deduction, to the extent the distribution is
attributable to dividends received by the Nasdaq-100 Trust from United States
corporations (other than real estate investment trusts) and is designated by
such Trust as being eligible for such deduction. To the extent dividends
received by the Nasdaq-100 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. Distributions from the S&P REIT Trust
will not be eligible for the dividends-received deduction. Each Trust will
provide each Unitholder with information annually concerning what part of Trust
distributions are eligible for the dividends-received deduction.
Under the Code, certain miscellaneous itemized deductions, such as investment
expenses, tax return preparation fees and employee business expenses, will be
deductible by individuals only to the extent they exceed 2% of adjusted gross
income. Miscellaneous itemized deductions subject to this limitation under
present law do not include expenses incurred by a Trust so long as the Units of
each Trust are held by or for 500 or more persons at all times during the
taxable year or another exception is met. In the event the Units of a Trust are
held by fewer than 500 persons, additional taxable income may be realized by the
individual (and other noncorporate) Unitholders in excess of the distributions
received from a particular Trust.
Distributions reinvested into additional Units of a Trust will be taxed to a
Unitholder in the manner described above (i. e., as ordinary income, long-term
capital gain or as a return of capital).
15
<PAGE>
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 a Trust to such
Unitholder (including amounts received upon the redemption of Units) will be
subject to back-up withholding. Distributions by a Trust will generally be
subject to United States income taxation and withholding in the case of Units
held by non-resident alien individuals, foreign corporations or other non-United
States persons. Such persons should consult their tax advisers.
A Unitholder who is a foreign investor (i.e., an investor other than a United
States citizen or resident or a United States corporation, partnership, estate
or trust) should be aware that, generally, subject to applicable tax treaties,
distributions from a Trust which constitute dividends for Federal income tax
purposes (other than dividends which the Trust designates as capital gain
dividends) will be subject to United States income taxes, including withholding
taxes. However, distributions received by a foreign investor from a Trust that
are designated by the Trust as capital gain dividends should not be subject to
United States Federal income taxes, including withholding taxes, if all of the
following conditions are met: (i) the capital gain dividend is not effectively
connected with the conduct by the foreign investor of a trade or business within
the United States, (ii) the foreign investor (if an individual) is not present
in the United States for 183 days or more during his or her taxable year, and
(iii) the foreign investor provides all certification which may be required of
his status (foreign investors may contact the Sponsor to obtain a Form W-8 which
must be filed with the Trustee and refiled every three calendar years
thereafter). Foreign investors should consult their tax advisors with respect
to United States tax consequences of ownership of Units. Units in the Trusts
and Trust distributions may also be subject to state and local taxation and
Unitholders should consult their tax advisors in this regard.
The federal tax status of each year's distributions will be reported to
Unitholders and to the Internal Revenue Service. The foregoing discussion
relates only to the federal income tax status of the Trusts and to the tax
treatment of distributions by the Trusts to United States Unitholders.
Distributions by a Trust will generally be subject to United States income
taxation and withholding in the case of Units held by non-resident alien
individuals, foreign corporations or other non-United States persons. Such
persons should consult their tax advisers. Units in a Trust and Trust
distributions may also be subject to state and local taxation and Unitholders
should consult their own tax advisers in this regard.
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.
16
<PAGE>
PUBLIC OFFERING OF UNITS
PUBLIC OFFERING PRICE. Units of the Trusts are offered at the Public Offering
Price (which is based on the aggregate underlying value of the Securities in a
Trust and includes a sales charge of 4.9% of the Public Offering Price which
charge is equivalent to 5.152% of the net amount invested) plus a pro rata share
of any accumulated dividends in the Income Account of a Trust. Such underlying
value shall also include the proportionate share of any undistributed cash held
in the Capital Account of the related Trust.
The sales charge per Unit of a Trust in both the primary and secondary market
will be reduced pursuant to the following graduated schedule:
<TABLE>
<CAPTION>
PERCENT OF PERCENT OF NET
NUMBER OF UNITS* OFFERING PRICE AMOUNT INVESTED
- ---------------- -------------- ---------------
<S> <C> <C>
Less than 10,000 4.9% 5.152%
10,000-24,999 4.5 4.712
25,000-49,999 4.3 4.493
50,000-99,999 3.5 3.627
100,000 or more 3.0 3.093
<FN>
- --------------------
* The breakpoint sales charges are also applied on a dollar basis utilizing a
breakpoint equivalent in the above table of $10 per Unit and will be applied
on whichever basis is more favorable to the investor.
</TABLE>
An investor may aggregate purchases of Units of the Trusts for purposes of
qualifying for the volume purchase discounts listed above. The reduced sales
charge structure will apply on all purchases of Units in the Trusts by the same
person on any one day from any one dealer. Additionally, Units purchased in the
name of the spouse of a purchaser or in the name of a child of such purchaser
under 21 years of age will be deemed, for purposes of calculating the applicable
sales charge, to be additional purchases by the purchaser. The reduced sales
charges will also be applicable to a trustee or other fiduciary purchasing
securities for a single trust estate or single fiduciary account.
Units may be purchased in the primary or secondary market at the Public Offering
Price less the concession the Sponsor typically allows to dealers and other
selling agents for purchases (see "Public Distribution of Units" below) by
officers, directors and employees of the Sponsor and its affiliates and
registered representatives of selling firms and by investors who purchase Units
through registered investment advisers, certified financial planners or
registered broker-dealers who in each case either charge periodic fees for
financial planning, investment advisory or asset management services, or provide
such services in connection with the establishment of an investment account for
which a comprehensive "wrap fee" charge is imposed.
Unitholders of any Ranson equity unit investment trust may utilize their
redemption or termination proceeds to purchase Units of the Trusts subject to a
reduced sales charge of 3% of the Public Offering Price (3.093% of the net
amount invested).
17
<PAGE>
Unitholders of unaffiliated unit investment trusts having an investment strategy
similar to the investment strategy of the Trusts may utilize proceeds received
upon termination or upon redemption immediately preceding termination of such
unaffiliated trust to purchase Units of the Trusts subject to a reduced sales
charge of 3% of the Public Offering Price (3.093% of the net amount invested).
As indicated above, the initial Public Offering Price of the Units was
established by dividing the aggregate underlying value of the Securities by the
number of Units outstanding. Such underlying value shall include the
proportionate share of any cash held in the Capital Account. Such price
determination as of the opening of business on the Initial Date of Deposit was
made on the basis of an evaluation of the Securities in a Trust prepared by the
Trustee. After the opening of business on the Initial Date of Deposit, the
Evaluator will appraise or cause to be appraised daily the value of the
underlying Securities as of the Evaluation Time on days the New York Stock
Exchange is open and will adjust the Public Offering Price of the Units
commensurate with such valuation. Such Public Offering Price will be effective
for all orders received at or prior to the close of trading on the New York
Stock Exchange on each such day. Orders received by the Trustee, Sponsor or any
dealer for purchases, sales or redemptions after that time, or on a day when the
New York Stock Exchange is closed, will be held until the next determination of
price.
The value of the Securities is determined on each business day by the Evaluator
based on the closing sale prices on a national securities exchange or The Nasdaq
National Market or by taking into account the same factors referred to under
"Redemption-Computation of Redemption Price."
The minimum purchase in both the primary and secondary markets is 100 Units.
PUBLIC DISTRIBUTION OF UNITS. Units which remain unsold or which may be
acquired in the secondary market (see "Market for Units") may be offered at the
Public Offering Price determined in the manner provided above.
The Sponsor intends to qualify Units of the Trusts for sale in a number of
states. Units will be sold through dealers who are members of the National
Association of Securities Dealers, Inc. and through others. Broker-dealers and
others will be allowed a concession or agency commission in connection with the
distribution of Units of 4.00% of the Public Offering Price.
Certain commercial banks are making Units of the Trusts available to their
customers on an agency basis. A portion of the sales charge paid by their
customers is retained by or remitted to the banks in the amounts shown above.
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 indicated that these particular agency
transactions are permitted under such Act. In addition, state securities laws
on this issue may differ from the interpretations of federal law expressed
herein and banks and financial institutions may be required to register as
dealers pursuant to state law. The Sponsor reserves the right to change the
concessions or agency commissions set forth above from time to time. In
addition to such concessions or agency commissions, the Sponsor may, from time
to time, pay or allow additional concessions or agency commissions, in the form
of cash or other compensation, to dealers employing registered representatives
who sell, during a specified time period, a minimum dollar amount of Units of
the Trusts and other unit investment trusts underwritten by the Sponsor. At
various times the Sponsor may implement programs under which the sales force of
a broker or dealer may be eligible to win nominal awards for certain sales
efforts, or under which the Sponsor will reallow to any such broker or dealer
that sponsors sales contests or recognition programs
18
<PAGE>
conforming to criteria established by the Sponsor, or participates in sales
programs sponsored by the Sponsor, an amount not exceeding the total applicable
sales charges on the sales generated by such person at the public offering price
during such programs. Also, the Sponsor in its discretion may from time to time
pursuant to objective criteria established by the Sponsor pay fees to qualifying
brokers or dealers for certain services or activities which are primarily
intended to result in sales of Units of the Trusts. Such payments are made by
the Sponsor out of its own assets, and not out of the assets of the Trust.
These programs will not change the price Unitholders pay for their Units or the
amount that a Trust will receive from the Units sold. The difference between
the discount and the sales charge will be retained by the Sponsor.
The Sponsor reserves the right to reject, in whole or in part, any order for the
purchase of Units.
SPONSOR PROFITS. The Sponsor will receive gross sales charges equal to the
percentage of the Public Offering Price of the Units of each Trust as stated
under "Public Offering Price." In addition, the Sponsor may realize a profit (or
sustain a loss) as of the Initial Date of Deposit resulting from the difference
between the purchase prices of the Securities to the Sponsor and the cost of
such Securities to each Trust, which is based on the evaluation of the
Securities on the Initial Date of Deposit. Thereafter, on subsequent deposits
the Sponsor may realize profits or sustain losses from such deposits. The
Sponsor may realize additional profits or losses on unsold Units as a result of
changes in the daily market value of the Securities in a Trust.
MARKET FOR UNITS
After the initial offering period, while not obligated to do so, the Sponsor
intends to, subject to change at any time, maintain a market for Units of the
Trusts offered hereby and to continuously offer to purchase said Units at
prices, determined by the Evaluator, based on the value of the underlying
Securities. Unitholders who wish to dispose of their Units should inquire of
their broker as to current market prices in order to determine whether there is
in existence any price in excess of the Redemption Price and, if so, the amount
thereof. The offering price of any Units resold by the Sponsor will be in
accord with that described in the currently effective prospectus describing such
Units. Any profit or loss resulting from the resale of such Units will belong
to the Sponsor. The Sponsor may suspend or discontinue purchases of Units of a
Trust if the supply of Units exceeds demand, or for other business reasons.
REDEMPTION
GENERAL. A Unitholder who does not dispose of Units in the secondary market
described above may cause Units to be redeemed by the Trustee by making a
written request to the Trustee at its Unit Investment Trust Division office in
the city of New York and, in the case of Units evidenced by a certificate, by
tendering such certificate to the Trustee properly endorsed or accompanied by a
written instrument or instruments of transfer in form satisfactory to the
Trustee. Unitholders must sign the request, and such certificate or transfer
instrument, exactly as their names appear on the records of the Trustee and on
any certificate representing the Units to be redeemed. If the amount of the
redemption is $500 or less and the proceeds are payable to the Unitholder(s) of
record at the address of record, no signature guarantee is necessary for
redemptions by individual account owners (including joint owners). Additional
documentation may be requested, and a signature guarantee is always required,
from corporations, executors, administrators, trustees, guardians or
associations. The signatures must be guaranteed by a participant in the
Securities Transfer Agents Medallion Program ("STAMP") or such other signature
guaranty program in addition to, or in substitution for, STAMP, as may be
19
<PAGE>
accepted by the Trustee. A certificate should only be sent by registered or
certified mail for the protection of the Unitholder. Since tender of the
certificate is required for redemption when one has been issued, Units
represented by a certificate cannot be redeemed until the certificate
representing such Units has been received by the purchasers.
Redemption shall be made by the Trustee on the third business day following the
day on which a tender for redemption is received (the "Redemption Date") by
payment of cash equivalent to the Redemption Price for a Trust, determined as
set forth below under "Computation of Redemption Price," as of the Evaluation
Time stated under "Essential Information," next following such tender,
multiplied by the number of Units being redeemed. Any Units redeemed shall be
canceled and any undivided fractional interest in the related Trust
extinguished. The price received upon redemption might be more or less than the
amount paid by the Unitholder depending on the value of the Securities in a
Trust at the time of redemption.
Under regulations issued by the Internal Revenue Service, the Trustee is
required to withhold a specified percentage of the principal amount of a Unit
redemption if the Trustee has not been furnished the redeeming Unitholder's tax
identification number in the manner required by such regulations. Any amount so
withheld is transmitted to the Internal Revenue Service and may be recovered by
the Unitholder only when filing a tax return. Under normal circumstances the
Trustee obtains the Unitholder's tax identification number from the selling
broker. However, any time a Unitholder elects to tender Units for redemption,
such Unitholder should make sure that the Trustee has been provided a certified
tax identification number in order to avoid this possible "back-up withholding."
In the event the Trustee has not been previously provided such number, one must
be provided at the time redemption is requested.
Any amounts paid on redemption representing unpaid dividends shall be withdrawn
from the Income Account of a Trust to the extent that funds are available for
such purpose. All other amounts paid on redemption shall be withdrawn from the
Capital Account for such Trust. The Trustee is empowered to sell Securities for
a Trust in order to make funds available for the redemption of Units of such
Trust. Such sale may be required when Securities would not otherwise be sold
and might result in lower prices than might otherwise be realized.
To the extent that Securities are sold, the size and diversity of a Trust will
be reduced but each remaining Unit will continue to represent approximately the
same proportional interest in each Security. Sales may be required at a time
when Securities would not otherwise be sold and may result in lower prices than
might otherwise be realized. The price received upon redemption may be more or
less than the amount paid by the Unitholder depending on the value of the
Securities in the portfolio at the time of redemption.
The right of redemption may be suspended and payment postponed (1) for any
period during which the New York Stock Exchange is closed, other than customary
weekend and holiday closings, or during which (as determined by the Securities
and Exchange Commission) trading on the New York Stock Exchange is restricted;
(2) for any period during which an emergency exists as a result of which
disposal by the Trustee of Securities is not reasonably practicable or it is not
reasonably practicable to fairly determine the value of the underlying
Securities in accordance with the Trust Agreement; or (3) for such other period
as the Securities and Exchange Commission may by order permit. The Trustee is
not liable to any person in any way for any loss or damage which may result from
any such suspension or postponement.
20
<PAGE>
COMPUTATION OF REDEMPTION PRICE. The Redemption Price per Unit (as well as the
secondary market Public Offering Price) will generally be determined on the
basis of the last sale price of the Securities in a Trust. The Redemption Price
per Unit is the pro rata share of each Unit in a Trust determined on the basis
of (i) the cash on hand in such Trust or moneys in the process of being
collected and (ii) the value of the Securities in such Trust less (a) amounts
representing taxes or other governmental charges payable out of such Trust, (b)
any amount owing to the Trustee for its advances and (c) the accrued expenses of
such Trust. The Evaluator may determine the value of the Securities in a Trust
in the following manner: if the Security is listed on a national securities
exchange or the Nasdaq National Market, the evaluation will generally be based
on the last sale price on the exchange or Nasdaq (unless the Evaluator deems the
price inappropriate as a basis for evaluation). If the Security is not so
listed or, if so listed and the principal market for the Security is other than
on the exchange or Nasdaq, the evaluation will generally be made by the
Evaluator in good faith based on the last bid price on the over-the-counter
market (unless the Evaluator deems such price inappropriate as a basis for
evaluation) or, if a bid price is not available, (1) on the basis of the
current bid price for comparable securities, (2) by the Evaluator's appraising
the value of the Securities in good faith at the bid side of the market or (3)
by any combination thereof. See "Public Offering of Units-Public Offering
Price."
RETIREMENT PLANS
The Trusts may be well suited for purchase by Individual Retirement Accounts,
Keogh Plans, pension funds and other qualified retirement plans. Generally,
capital gains and income received under each of the foregoing plans are deferred
from Federal taxation. All distributions from such plans are generally treated
as ordinary income but may, in some cases, be eligible for special income
averaging or tax-deferred rollover treatment. Investors considering
participation in any such plan should review specific tax laws related thereto
and should consult their attorneys or tax advisers with respect to the
establishment and maintenance of any such plan. Such plans are offered by
brokerage firms and other financial institutions. The Trusts will waive the
$1,000 minimum investment requirement for IRA accounts. The minimum investment
is $250 for tax-deferred plans such as IRA accounts. Fees and charges with
respect to such plans may vary.
The Trustee has agreed to act as custodian for certain retirement plan accounts.
An annual fee of $12.00 per account, if not paid separately, will be assessed by
the Trustee and paid through the liquidation of shares of the reinvestment
account. An individual wishing the Trustee to act as custodian must complete a
Ranson UIT/IRA application and forward it along with a check made payable to The
Bank of New York. Certificates for Individual Retirement Accounts cannot be
issued.
UNITHOLDERS
OWNERSHIP OF UNITS. Ownership of Units of the Trusts will not be evidenced by
certificates unless a Unitholder, the Unitholder's registered broker/dealer or
the clearing agent for such broker/dealer makes a written request to the
Trustee. Units are transferable by making a written request to the Trustee and,
in the case of Units evidenced by a certificate, by presenting and surrendering
such certificate to the Trustee properly endorsed or accompanied by a written
instrument or instruments of transfer which should be sent by registered or
certified mail for the protection of the Unitholder. Unitholders must sign such
written request, and such certificate or transfer instrument, exactly as their
names appear on the records of the Trustee and on any certificate representing
the Units to be transferred. Such signatures must be guaranteed as stated under
"Redemption-General."
21
<PAGE>
Units may be purchased and certificates, if requested, will be issued in
denominations of one Unit or any multiple thereof, subject to the minimum
investment requirement of 100 Units or $1,000. Fractions of Units, if any, will
be computed to three decimal places. Any certificate issued will be numbered
serially for identification, issued in fully registered form and will be
transferable only on the books of the Trustee. The Trustee may require a
Unitholder to pay a reasonable fee, to be determined in the sole discretion of
the Trustee, for each certificate re-issued or transferred and to pay any
governmental charge that may be imposed in connection with each such transfer or
interchange. The Trustee at the present time does not intend to charge for the
normal transfer or interchange of certificates. Destroyed, stolen, mutilated or
lost certificates will be replaced upon delivery to the Trustee of satisfactory
indemnity (generally amounting to 3% of the market value of the Units),
affidavit of loss, evidence of ownership and payment of expenses incurred.
DISTRIBUTIONS TO UNITHOLDERS. Income received by a Trust is credited by the
Trustee to the Income Account of such Trust. Other receipts are credited to the
Capital Account of a Trust. Income received by a Trust will be distributed on
or shortly after the 15th day of January, April, July and October of each year
on a pro rata basis to Unitholders of record as of the preceding record date
(which will be the first day of the related month). All distributions will be
net of applicable expenses. There is no assurance that any actual distributions
will be made since all dividends received may be used to pay expenses. In
addition, amounts from the Capital Account of a Trust, if any, will be
distributed at least annually to the Unitholders then of record. Proceeds
received from the disposition of any of the Securities after a record date and
prior to the following distribution date will be held in the Capital Account and
not distributed until the next distribution date applicable to the Capital
Account. The Trustee shall be required to make a distribution from the Capital
Account if the cash balance on deposit therein available for distribution shall
be sufficient to distribute at least $1.00 per 100 Units. The Trustee is not
required to pay interest on funds held in the Capital or Income Accounts (but
may itself earn interest thereon and therefore benefits from the use of such
funds). The Trustee is authorized to reinvest any funds held in the Capital or
Income Accounts, pending distribution, in U.S. Treasury obligations which mature
on or before the next applicable distribution date. Any obligations so acquired
must be held until they mature and proceeds therefrom may not be reinvested.
The distribution to the Unitholders as of each record date will be made on the
following distribution date or shortly thereafter and shall consist of an amount
substantially equal to such portion of the Unitholders' pro rata share of the
dividend distributions then held in the Income Account after deducting estimated
expenses. Because dividends are not received by the Trust at a constant rate
throughout the year, such distributions to Unitholders are expected to
fluctuate. Persons who purchase Units will commence receiving distributions
only after such person becomes a record owner. A person will become the owner
of Units, and thereby a Unitholder of record, on the date of settlement provided
payment has been received. Notification to the Trustee of the transfer of Units
is the responsibility of the purchaser, but in the normal course of business
such notice is provided by the selling broker-dealer.
As of the first day of each month, the Trustee will deduct from the Income
Account of a Trust and, to the extent funds are not sufficient therein, from the
Capital Account of such Trust amounts necessary to pay the expenses of such
Trust (as determined on the basis set forth under "Expenses of the Trusts").
The Trustee also may withdraw from said accounts such amounts, if any, as it
deems necessary to establish a reserve for any governmental charges payable out
of a Trust. Amounts so withdrawn shall not be considered a part of a Trust's
assets until such time as the Trustee shall return all or any part of such
amounts to the appropriate accounts. In addition, the Trustee may withdraw from
the Income and Capital Accounts of a Trust such amounts as may be necessary to
cover redemptions of Units.
22
<PAGE>
DISTRIBUTION REINVESTMENT. Unitholders may elect to have distributions of
capital (including capital gains, if any) or dividends or both automatically
invested into additional Units of a Trust without a sales charge. In addition,
Unitholders may elect to have distributions of capital (including capital gains,
if any) or dividends or both automatically invested without charge in shares of
certain front-end load mutual funds underwritten or advised by Scudder Kemper
Investments, Inc. at net asset value if such funds are registered in such
Unitholder's state of residence, other than those mutual funds sold with a
contingent deferred sales charge. Since the portfolio securities and investment
objectives of such mutual funds generally will differ significantly from those
of the Trusts, Unitholders should carefully consider the consequences before
selecting such mutual funds for reinvestment. Detailed information with respect
to the investment objectives and the management of such mutual funds is
contained in their respective prospectuses, which can be obtained from the
Sponsor upon request. An investor should read the prospectus of the
reinvestment fund selected prior to making the election to reinvest.
Unitholders who desire to have such distributions automatically reinvested
should inform their broker at the time of purchase or should file with the
Program Agent referred to below a written notice of election.
Unitholders who are receiving distributions in cash may elect to participate in
distribution reinvestment by filing with the Program Agent an election to have
such distributions reinvested without charge. Such election must be received by
the Program Agent at least ten days prior to the Record Date applicable to any
distribution in order to be in effect for such Record Date. Any such election
shall remain in effect until a subsequent notice is received by the Program
Agent. See "Unitholders-Distributions to Unitholders."
The Program Agent is The Bank of New York. All inquiries concerning
participating in distribution reinvestment should be directed to The Bank of New
York at its Unit Investment Trust Division office.
STATEMENTS TO UNITHOLDERS. With each distribution, the Trustee will furnish or
cause to be furnished to each Unitholder a statement of the amount of income and
the amount of other receipts, if any, which are being distributed, expressed in
each case as a dollar amount per Unit.
The accounts of each Trust are required to be audited annually, at the related
Trust's expense, by independent public accountants designated by the Sponsor,
unless the Sponsor determines that such an audit would not be in the best
interest of the Unitholders of such Trust. The accountants' report will be
furnished by the Trustee to any Unitholder of a Trust upon written request.
Within a reasonable period of time after the end of each calendar year, the
Trustee shall furnish to each person who at any time during the calendar year
was a Unitholder of a Trust a statement, covering the calendar year, setting
forth for such Trust:
(A) As to the Income Account:
(1) Income received;
(2) Deductions for applicable taxes and for fees and expenses of such Trust
and for redemptions of Units, if any; and
(3) The balance remaining after such distributions and deductions, expressed
in each case both as a total dollar amount and as a dollar amount
representing the pro rata share of each Unit outstanding on the last
business day of such calendar year; and
23
<PAGE>
(B) As to the Capital Account:
(1) The dates of disposition of any Securities and the net proceeds received
therefrom;
(2) Deductions for payment of applicable taxes and fees and expenses of such
Trust held for distribution to Unitholders of record as of a date prior to
the determination; and
(3) The balance remaining after such distributions and deductions expressed
both as a total dollar amount and as a dollar amount representing the pro
rata share of each Unit outstanding on the last business day of such
calendar year; and
(C) The following information:
(1) A list of the Securities as of the last business day of such calendar
year;
(2) The number of Units outstanding on the last business day of such calendar
year;
(3) The Redemption Price based on the last evaluation made during such
calendar year;
(4) The amount actually distributed during such calendar year from the Income
and Capital Accounts separately stated, expressed both as total dollar
amounts and as dollar amounts per Unit outstanding on the Record Dates for
each such distribution.
RIGHTS OF UNITHOLDERS. A Unitholder may at any time tender Units to the Trustee
for redemption. The death or incapacity of any Unitholder will not operate to
terminate a Trust nor entitle legal representatives or heirs to claim an
accounting or to bring any action or proceeding in any court for partition or
winding up of such Trust.
No Unitholder shall have the right to control the operation and management of a
Trust in any manner, except to vote with respect to the amendment of the Trust
Agreement or termination of such Trust.
INVESTMENT SUPERVISION
Each Trust is a unit investment trust and is not an "actively managed" fund.
Traditional methods of investment management for a managed fund typically
involve frequent changes in a portfolio of securities on the basis of economic,
financial and market analyses. The portfolio of a Trust, however, will not be
actively managed and therefore the adverse financial condition of an issuer will
not necessarily require the sale of its securities from the portfolio.
As a general rule, the only purchases and sales that will be made with respect
to a Trust's portfolio will be those necessary to maintain, to the extent
feasible, a portfolio which reflects the current components of the related stock
index, taking into consideration redemptions, sales of additional Units and the
other adjustments referred to elsewhere in this prospectus. See "Trust
Portfolios." Such purchases and sales will be made in accordance with the
computer program utilized to maintain the related portfolio, the Trust Agreement
and procedures to be specified by the Sponsor. The Sponsor may direct the
Trustee to dispose of Securities and either to acquire other Securities through
the use of the proceeds of such disposition in order to make changes in a
portfolio or to distribute the proceeds of such disposition to Unitholders (i)
as necessary to reflect any additions to or deletions from the related stock
index, (ii) as may be necessary to establish a closer correlation between a
Trust portfolio and the related stock index or (iii) as may be required for
purposes of distributing to Unitholders, when required, their pro rata share of
any net realized capital gains or as the Sponsor may otherwise determine. As a
policy matter, the Sponsor currently intends to direct the Trustee to acquire
round lots of shares of the
24
<PAGE>
Securities rather than odd lot amounts. Any funds not used to acquire round
lots will be held for future purchases of shares, for redemptions of Units or
for distributions to Unitholders. In the event the Trustee receives any
securities or other properties relating to the Securities (other than normal
dividends) acquired in exchange for Securities such as those acquired in
connection with a reorganization, recapitalization, merger or other transaction,
the Trustee is directed to sell such securities or other property and reinvest
the proceeds in shares of the Security for which such securities or other
property relates, or if such Security is thereafter removed from the related
stock index, in any new security which is added as a component of such index.
In addition, the Sponsor will instruct the Trustee to dispose of certain
Securities and to take such further action as may be needed from time to time to
ensure that a Trust continues to satisfy the qualifications of a regulated
investment company, including the requirements with respect to diversification
under Section 851 of the Internal Revenue Code, and as may be needed from time
to time to avoid the imposition of any excise tax on such Trust as a regulated
investment company.
Proceeds from the sale of Securities (or any securities or other property
received by a Trust in exchange for Securities) are credited to the Capital
Account for distribution to Unitholders or to meet redemptions. Except as
stated under "The Trust Funds" for failed securities and as provided herein, the
acquisition by a Trust of any securities other than the Securities is
prohibited. The Trustee may sell Securities, designated by the Sponsor, from a
Trust for the purpose of redeeming Units of such Trust tendered for redemption
and the payment of expenses.
ADMINISTRATION OF THE TRUSTS
THE TRUSTEE. The Trustee is The Bank of New York, a trust company organized
under the laws of New York. The Bank of New York has its Unit Investment Trust
Division offices at 101 Barclay Street, New York, New York 10286, telephone 1-
800-701-8178. The Bank of New York is subject to supervision and examination by
the Superintendent of Banks of the State of New York and the Board of Governors
of the Federal Reserve System, and its deposits are insured by the Federal
Deposit Insurance Corporation to the extent permitted by law.
The Trustee, whose duties are ministerial in nature, has not participated in
selecting the portfolios of the Trusts. For information relating to the
responsibilities of the Trustee under the Trust Agreement, reference is made to
the material set forth under "Unitholders."
In accordance with the Trust Agreement, the Trustee shall keep records of all
transactions at its office. Such records shall include the name and address of,
and the number of Units held by, every Unitholder of a Trust. Such books and
records shall be open to inspection by any Unitholder at all reasonable times
during usual business hours. The Trustee shall make such annual or other
reports as may from time to time be required under any applicable state or
federal statute, rule or regulation. The Trustee shall keep a certified copy or
duplicate original of the Trust Agreement on file in its office available for
inspection at all reasonable times during usual business hours by any
Unitholder, together with a current list of the Securities held in each Trust.
Pursuant to the Trust Agreement, the Trustee may employ one or more agents for
the purpose of custody and safeguarding of Securities comprising a Trust.
Under the Trust Agreement, the Trustee or any successor trustee may resign and
be discharged of the trust created by the Trust Agreement by executing an
instrument in writing and filing the same with the Sponsor.
25
<PAGE>
The Trustee or successor trustee must mail a copy of the notice of resignation
to all Unitholders then of record, not less than sixty days before the date
specified in such notice when such resignation is to take effect. The Sponsor
upon receiving notice of such resignation is obligated to appoint a successor
trustee promptly. If, upon such resignation, no successor trustee has been
appointed and has accepted the appointment within thirty days after
notification, the retiring Trustee may apply to a court of competent
jurisdiction for the appointment of a successor. The Sponsor may at any time
remove the Trustee, with or without cause, and appoint a successor trustee as
provided in the Trust Agreement. Notice of such removal and appointment shall
be mailed to each Unitholder by the Sponsor. Upon execution of a written
acceptance of such appointment by such successor trustee, all the rights,
powers, duties and obligations of the original Trustee shall vest in the
successor. The Trustee must be a corporation organized under the laws of the
United States, or any state thereof, be authorized under such laws to exercise
trust powers and have at all times an aggregate capital, surplus and undivided
profits of not less than $5,000,000.
THE SPONSOR. Ranson & Associates, Inc., the Sponsor of the Trusts, is an
investment banking firm created in 1995 by a number of former owners and
employees of Ranson Capital Corporation. On November 26, 1996, Ranson &
Associates, Inc. purchased all existing unit investment trusts sponsored by
EVEREN Securities, Inc. Accordingly, Ranson & Associates, Inc. is the successor
sponsor to unit investment trusts formerly sponsored by EVEREN Unit Investment
Trusts, a service of EVEREN Securities, Inc. Ranson & Associates, Inc. is also
the sponsor and successor sponsor of Series of The Kansas Tax-Exempt Trust and
Multi-State Series of The Ranson Municipal Trust. Ranson & Associates, Inc. is
the successor to a series of companies, of first of which was originally
organized in Kansas in 1935. During its history, Ranson & Associates, Inc. and
its predecessors have been active in public and corporate finance and have sold
bonds and unit investment trusts and maintained secondary market activities
relating thereto. At present, Ranson & Associates, Inc., which is a member of
the National Association of Securities Dealers, Inc., is the Sponsor to each of
the above-named unit investment trusts and serves as the financial advisor and
as an underwriter for Kansas municipalities. The Sponsor's offices are located
at 250 North Rock Road, Suite 150, Wichita, Kansas 67206-2241.
If at any time the Sponsor shall fail to perform any of its duties under the
Trust Agreement or shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or shall have its affairs taken over by public
authorities, then the Trustee may (a) appoint a successor sponsor at rates of
compensation deemed by the Trustee to be reasonable and not exceeding such
reasonable amounts as may be prescribed by the Securities and Exchange
Commission, or (b) terminate the Trust Agreement and liquidate the Trusts as
provided therein, or (c) continue to act as Trustee without terminating the
Trust Agreement.
The foregoing financial information with regard to the Sponsor relates to the
Sponsor only and not to the Trusts. Such information is included in this
Prospectus only for the purpose of informing investors as to the financial
responsibility of the Sponsor and its ability to carry out its contractual
obligations with respect to the Trusts. More comprehensive financial
information can be obtained upon request from the Sponsor.
THE EVALUATOR. Ranson & Associates, Inc., the Sponsor, also serves as
Evaluator. The Evaluator may resign or be removed by the Trustee in which event
the Trustee is to use its best efforts to appoint a satisfactory successor.
Such resignation or removal shall become effective upon acceptance of
appointment by the successor evaluator. If upon resignation of the Evaluator no
successor has accepted appointment within thirty days after notice of
resignation, the Evaluator may apply to a court of competent jurisdiction for
the appointment of a successor. Notice of such registration or removal and
appointment shall be mailed by the Trustee to each Unitholder.
26
<PAGE>
AMENDMENT AND TERMINATION. The Trust Agreement may be amended by the Trustee
and the Sponsor without the consent of any of the Unitholders: (1) to cure any
ambiguity or to correct or supplement any provision which may be defective or
inconsistent; (2) to change any provision thereof as may be required by the
Securities and Exchange Commission or any successor governmental agency; or (3)
to make such provisions as shall not adversely affect the interests of the
Unitholders. The Trust Agreement with respect to a Trust may also be amended in
any respect by the Sponsor and the Trustee, or any of the provisions thereof may
be waived, with the consent of the holders of Units representing 66 2/3% of the
Units then outstanding of such Trust, provided that no such amendment or waiver
will reduce the interest of any Unitholder thereof without the consent of such
Unitholder or reduce the percentage of Units required to consent to any such
amendment or waiver without the consent of all Unitholders of such Trust. In no
event shall the Trust Agreement be amended to increase the number of Units of a
Trust issuable thereunder or to permit the acquisition of any Securities in
addition to or in substitution for those initially deposited in such Trust,
except in accordance with the provisions of the Trust Agreement. The Trustee
shall promptly notify Unitholders of the substance of any such amendment.
The Trust Agreement provides that a Trust shall terminate upon the liquidation,
redemption or other disposition of the last of the Securities held in such Trust
but in no event is it to continue beyond the Mandatory Termination Date set
forth under "Essential Information" in Part Two. If the value of a Trust shall
be less than the applicable minimum value stated under "Essential Information"
in Part Two (40% of the aggregate value of the Securities-based on the value at
the date of deposit of such Securities into such Trust), the Trustee may, in its
discretion, and shall, when so directed by the Sponsor, terminate such Trust. A
Trust may be terminated at any time by the holders of Units representing 66 2/3%
of the Units thereof then outstanding. In addition, the Sponsor may terminate a
Trust if the related stock index is no longer maintained.
No later than the Mandatory Termination Date set forth under "Essential
Information" in Part Two, the Trustee will begin to sell all of the remaining
underlying Securities on behalf of Unitholders in connection with the
termination of the Trusts. The Sponsor has agreed to assist the Trustee in
these sales. The sale proceeds will be net of any incidental expenses involved
in the sales.
The Sponsor will attempt to sell the Securities as quickly as it can during the
termination proceedings without in its judgment materially adversely affecting
the market price of the Securities, but it is expected that all of the
Securities will in any event be disposed of within a reasonable time after a
Trust's termination. The Sponsor does not anticipate that the period will be
longer than one month, and it could be as short as one day, depending on the
liquidity of the Securities being sold. The liquidity of any Security depends
on the daily trading volume of the Security and the amount that the Sponsor has
available for sale on any particular day.
In the event of termination of a Trust, written notice thereof will be sent by
the Trustee to all Unitholders of such Trust. Within a reasonable period after
termination, the Trustee will sell any Securities remaining in a Trust and,
after paying all expenses and charges incurred by such Trust, will distribute to
Unitholders thereof (upon surrender for cancellation of certificates for Units,
if issued) their pro rata share of the balances remaining in the Income and
Capital Accounts of such Trust.
The Sponsor currently intends, but is not obligated, to offer for sale units of
a subsequent series of the Trusts at approximately the time of the Mandatory
Termination Date. If the Sponsor does offer such units for sale,
27
<PAGE>
Unitholders may be given the opportunity to purchase such units at a public
offering price which includes a reduced sales charge. There is, however, no
assurance that units of any new series of a Trust will be offered for sale at
that time, or if offered, that there will be sufficient units available for sale
to meet the requests of any or all Unitholders.
LIMITATIONS ON LIABILITY. The Sponsor: The Sponsor is liable for the
performance of its obligations arising from its responsibilities under the Trust
Agreement, but will be under no liability to the Unitholders for taking any
action or refraining from any action in good faith pursuant to the Trust
Agreement or for errors in judgment, except in cases of its own gross
negligence, bad faith or willful misconduct or its reckless disregard for its
duties thereunder. The Sponsor shall not be liable or responsible in any way
for depreciation or loss incurred by reason of the sale of any Securities.
The Trustee: The Trust Agreement provides that the Trustee shall be under no
liability for any action taken in good faith in reliance upon prima facie
properly executed documents or for the disposition of moneys, Securities or
certificates except by reason of its own negligence, bad faith or willful
misconduct, or its reckless disregard for its duties under the Trust Agreement,
nor shall the Trustee be liable or responsible in any way for depreciation or
loss incurred by reason of the sale by the Trustee of any Securities. In the
event that the Sponsor shall fail to act, the Trustee may act and shall not be
liable for any such action taken by it in good faith. The Trustee shall not be
personally liable for any taxes or other governmental charges imposed upon or in
respect of the Securities or upon the interest thereof. In addition, the Trust
Agreement contains other customary provisions limiting the liability of the
Trustee.
The Evaluator: The Trustee and Unitholders may rely on any evaluation furnished
by the Evaluator and shall have no responsibility for the accuracy thereof. The
Trust Agreement provides that the determinations made by the Evaluator shall be
made in good faith upon the basis of the best information available to it,
provided, however, that the Evaluator shall be under no liability to the Trustee
or Unitholders for errors in judgment, but shall be liable for its gross
negligence, bad faith or willful misconduct or its reckless disregard for its
obligations under the Trust Agreement.
EXPENSES OF THE TRUSTS
The Sponsor will not charge the Trusts any fees for services performed as
Sponsor. The Sponsor will receive a portion of the sale commissions paid in
connection with the purchase of Units and will share in profits, if any, related
to the deposit of Securities in a Trust.
The Trustee receives for its services that fee set forth under "Essential
Information" in Part Two. However, in no event shall such fee amount to less
than $2,000 in any single calendar year. The Trustee's fee which is calculated
monthly is based on the largest number of Units of a Trust outstanding during
the calendar year for which such compensation relates. The Trustee's fees are
payable monthly on or before the fifteenth day of the month from the Income
Account to the extent funds are available and then from the Capital Account.
The Trustee benefits to the extent there are funds for future distributions,
payment of expenses and redemptions in the Capital and Income Accounts since
these Accounts are non-interest bearing and the amounts earned by the Trustee
are retained by the Trustee. Part of the Trustee's compensation for its
services to the Trusts is expected to result from the use of these funds.
28
<PAGE>
In its capacity as Supervisor, the Sponsor will charge the Trusts a surveillance
fee for services performed for the Trusts in an amount not to exceed that amount
set forth in "Essential Information" in Part Two but in no event will such
compensation, when combined with all compensation received from other unit
investment trusts for which the Sponsor both acts as sponsor and provides
portfolio surveillance, exceed the aggregate cost to the Sponsor for providing
such services. Such fee shall be based on the total number of Units of the
related Trust outstanding as of the January record date for any annual period.
For evaluation of the Securities in a Trust, the Evaluator shall receive that
fee set forth under "Essential Information" in Part Two, payable monthly, based
upon the largest number of Units of a Trust outstanding during the calendar year
for which such compensation relates.
The Trustee's fee, Supervisor's fee and Evaluator's fee are deducted from the
Income Account of the related Trust to the extent funds are available and then
from the Capital Account. Each such fee may be increased without approval of
Unitholders by amounts not exceeding a proportionate increase in the Consumer
Price Index or any equivalent index substituted therefor.
The Nasdaq-100 Trust Licensor receives an annual fee from the Nasdaq-100 Trust
equal to the greater of (a) .02% of the average net asset value of such Trust
computed quarterly or (b) a minimum of $7,000 during the first year of such
Trust's life, $8,000 during the second year of such Trust's life and $9,000
thereafter. This fee covers the license to the Nasdaq-100 Trust of the use of
various trademarks and trade names as described under "The Nasdaq-100 Index."
This fee may be increased annually by the amount of the increase, if any, in the
Consumer Price Index for Urban Consumers, All Items, as issued by the Bureau of
Labor Statistics, U.S. Department of Labor, over the prior twelve-month period.
The S&P REIT Trust Licensor receives an annual fee from the S&P REIT Trust equal
to the greater of .02% of the average net asset value of such Trust or $10,000.
This fee covers the license to the S&P REIT Trust of the use of various
trademarks and trade names as described under "The S&P REIT Index."
Expenses incurred in establishing each Trust, including the cost of the initial
preparation of documents relating to such Trust (including the Prospectus, Trust
Agreement and certificates), federal and state registration fees, the initial
fees and expenses of the Trustee, legal and accounting expenses, payment of
closing fees and any other out-of-pocket expenses, will be paid by such Trust
(out of the Capital Account) and it is intended that such expenses be amortized
over a five year period or the life of the Trust if less than five years. The
following additional charges are or may be incurred by a Trust: (a) fees for
the Trustee's extraordinary services; (b) expenses of the Trustee (including
legal and auditing expenses, but not including any fees and expenses charged by
an agent for custody and safeguarding of Securities) and of counsel, if any; (c)
various governmental charges; (d) expenses and costs of any action taken by the
Trustee to protect the Trust or the rights and interests of the Unitholders; (e)
indemnification of the Trustee for any loss, liability or expense incurred by it
in the administration of the Trust not resulting from negligence, bad faith or
willful misconduct on its part or its reckless disregard for its obligations
under the Trust Agreement; (f) indemnification of the Sponsor for any loss,
liability or expense incurred in acting in that capacity without gross
negligence, bad faith or willful misconduct or its reckless disregard for its
obligations under the Trust Agreement; and (g) expenditures incurred in
contacting Unitholders upon termination of such Trust. The fees and expenses
set forth herein are payable out of a Trust and, when owing to the Trustee, are
secured by a lien on such Trust. Since the Securities are all common stocks,
and the income stream produced by dividend payments, if any, is unpredictable,
the
29
<PAGE>
Sponsor cannot provide any assurance that dividends will be sufficient to meet
any or all expenses of a Trust. If the balances in the Income and Capital
Accounts are insufficient to provide for amounts payable by a Trust, the Trustee
has the power to sell Securities to pay such amounts. These sales may result in
capital gains or losses to Unitholders. See "Federal Tax Status." It is
expected that the income stream produced by dividend payments will be
insufficient to meet the expenses of the Nasdaq-100 Trust and, accordingly, it
is expected that Securities will be sold to pay all of the fees and expenses of
such Trust. The Trust may pay the expenses of updating its registration
statement. Unit investment trust sponsors have historically paid these
expenses.
LEGAL OPINIONS
The legality of the Units offered hereby and certain matters relating to federal
tax law have been passed upon by Chapman and Cutler, 111 West Monroe Street,
Chicago, Illinois 60603, as counsel for the Sponsor.
INDEPENDENT AUDITORS
The statement of net assets, including the Trust portfolio, of the Trust,
appearing in this Prospectus and Registration Statement have been audited by
Ernst & Young, LLP, independent auditors, as set forth in their report appearing
elsewhere herein, and are included in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing.
--------------------
30
<PAGE>
<TABLE>
<CAPTION>
CONTENTS PAGE
- -------- ----
<S> <C>
NASDAQ-100(Registered Trademark)
INDEX LICENSING AGREEMENT 2
THE TRUST FUNDS 3
THE TRUST PORTFOLIOS 4
THE NASDAQ-100 INDEX 5
THE S&P REIT INDEX 8
RISK FACTORS 9
FEDERAL TAX STATUS 14
PUBLIC OFFERING OF UNITS 17
Public Offering Price 17
Public Distribution of Units 18
Sponsor Profits 19
MARKET FOR UNITS 19
REDEMPTION 19
General 19
Computation of Redemption Price 21
RETIREMENT PLANS 21
UNITHOLDERS 21
Ownership of Units 21
Distributions to Unitholders 22
Distribution Reinvestment 23
Statements to Unitholders 23
Rights of Unitholders 24
INVESTMENT SUPERVISION 24
ADMINISTRATION OF THE TRUSTS 25
The Trustee 25
The Sponsor 26
The Evaluator 26
Amendment and Termination 27
Limitations on Liability 28
EXPENSES OF THE TRUSTS 28
LEGAL OPINIONS 30
INDEPENDENT AUDITORS 30
</TABLE>
<PAGE>
--------------
RANSON
UNIT
INVESTMENT
TRUSTS
--------------
NASDAQ-100
INDEX TRUST
S&P REIT
INDEX TRUST
-------------------
PROSPECTUS PART ONE
-------------------
<PAGE>
Ranson Unit Investment Trusts
S&P REIT Index Trust
Series 1
Part Two
Dated April 30, 1999
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
NOTE: Part Two of this Prospectus May Not Be Distributed Unless Accompanied by
Part One.
<PAGE>
<TABLE>
<CAPTION>
Ranson Unit Investment Trusts
S&P REIT Index Trust
Series 1
Essential Information
As of December 31, 1998
Sponsor and Evaluator: Ranson & Associates, Inc.
Trustee: The Bank of New York Co.
General Information
<S> <C>
Agregate Value of Securities in the Trust $3,651,050
Number of Units 499,277
Fractional Undivided Interest in the Trust per Unit 1/499,277
Aggregate Value of Securities per Unit $7.313
Public Offering Price:
Aggregate Value of Securities in Portfolio $3,651,050
Aggregate Value of Securities per Unit $7.313
Net Cash per Unit (1) $.001
Sales Charge of 4.90% of Public Offering Price
(5.152% of net amount invested) per Unit $.377
Public Offering Price per Unit $7.691
Redemption Price per Unit $7.314
</TABLE>
Minimum Value of the Trust under which Trust Agreement may be Terminated
Trust agreement may be terminated if value of Trust is less than
$117,902 (40% of the aggregate
value of the Securities deposited
in the Trust).
Date of Trust Agreement March 4, 1998
Mandatory Termination Date April 30, 2004
Evaluator's Annual Evaluation Fee Maximum of $.003 per Unit
Supervisor's Annual Surveillance Fee Maximum of $.003 per Unit
Trustee's Annual Fee $.009 per Unit
S & P REIT Trust Licensor Fee Equal to the greater of .02% of
the average net asset value or
$10,000.
Record Dates First day of January, April, July
and October.
Distribution Dates Fifteenth day of January, April,
July and October.
[FN]
(1) This amount, if any, represents principal cash or overdraft which is an
asset or liability of the Trust and is included in the Public Offering Price.
<PAGE>
Report of Independent Auditors
Unitholders
Ranson Unit Investment Trusts
S&P REIT Index Trust
Series 1
We have audited the accompanying statement of assets and liabilities of Ranson
Unit Investment Trusts, S&P REIT Index Trust, Series 1, including the schedule
of investments, as of December 31, 1998, and the related statement of operations
and changes in net assets for the period from March 5, 1998 (Date of Deposit) to
December 31, 1998. These financial statements are the responsibility of the
Trust's sponsor. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
Our procedures included confirmation of investments owned as of
December 31, 1998, by correspondence with the custodial bank. An audit
also includes assessing the accounting principles used and significant
estimates made by the sponsor, as well as evaluating the overall financial
statement presentation. We believe that our 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 Ranson Unit Investment Trusts,
S&P REIT Index Trust, Series 1 at December 31, 1998, and the results of its
operations and changes in its net assets for the period indicated above in
conformity with generally accepted accounting principles.
Ernst & Young LLP
Kansas City, Missouri
April 16, 1999
<PAGE>
<TABLE>
<CAPTION>
Ranson Unit Investment Trusts
S&P REIT Index Trust
Series 1
Statement of Assets and Liabilities
December 31, 1998
<S> <C> <C>
Assets
Securities, at value (cost $3,946,369) $3,651,050
Dividends receivable 32,097
Cash 11,942
Organization costs 12,987
Prepaid expense 9,403
---------
Total assets 3,717,479
Liabilities and net assets -
Net assets, applicable to 499,277 Units outstanding:
Cost of Trust assets, exclusive of interest $3,946,369
Unrealized depreciation (295,319)
Distributable funds 66,429
--------- ---------
Net assets $3,717,479
=========
</TABLE>
[FN]
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
Ranson Unit Investment Trusts
S&P REIT Index Trust
Series 1
Statement of Operations
Period from
March 5,
1998 to
December 31,
1998
---------
<S> <C>
Investment income - dividends $84,662
Expenses:
Trustee's fees and related expenses 2,346
Evaluator's and surveillance fees 1,208
Amortization of organizational costs 3,247
---------
Total expenses 6,801
---------
Net investment income 77,861
Realized and unrealized loss on investments:
Realized loss (22,072)
Unrealized depreciation during the period (295,319)
---------
Net loss on investments (317,391)
---------
Net decrease in net assets resulting from operations $(239,530)
=========
</TABLE>
[FN]
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
Ranson Unit Investments Trusts
S&P REIT Index Trust
Series 1
Statement of Changes in Net Assets
Period from
March 5,
1998 to
December 31,
1998
---------
<S> <C>
Operations:
Net investment income $77,861
Realized loss on investments (22,072)
Unrealized depreciation on investments during the period (295,319)
---------
Net decrease in net assets resulting from operations (239,530)
Distributions to Unitholders:
Net investment income (38,652)
---------
Total distributions to Unitholders (38,652)
Capital transactions:
Issuance of 499,278 Units 3,995,667
Redemption of 1 Unit (6)
---------
Total increase in net assets 3,717,479
Net assets:
At the beginning of the period -
---------
At the end of the period (including distributable
funds applicable to Trusts Units of $66,429 at
December 31, 1998) $3,717,479
=========
Trust Units outstanding at the end of the period 499,277
=========
Net asset value per Unit at the end of the period $7.45
=========
</TABLE>
[FN]
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
Ranson Unit Investment Trusts
S&P REIT Index Trust
Series 1
Schedule of Investments
December 31, 1998
Percentage (%)
of Total
Shares Name of Issuer Market Value Market Value
- ------ -------------- ------------ ------------
<S> <C> <C> <C>
2,700 AMB Poperty Corp. $59,400.00 1.627
800 American Health Property 16,500.00 0.452
1,500 Apartment Investment & Management 55,781.25 1.528
4,500 Archstone Communities 91,125.00 2.496
2,000 Arden Realty 46,375.00 1.270
2,700 Associated Estates Realty 69,268.75 1.897
2,000 AvalonBay Communities 68,500.00 1.876
700 Bedford Property 11,812.50 0.324
1,200 Berkshire Realty 11,400.00 0.312
800 Bradley Real Estate 16,400.00 0.449
1,200 Brandywine Realty Trust 21,450.00 0.588
1,400 BRE Properties Class A 34,650.00 0.949
1,000 Burnham Pacific Properties 12,062.50 0.330
1,400 Camden Property Trust 36,400.00 0.997
2,100 CarrAmerica Realty 50,400.00 1.380
800 CBL & Associates Properties 20,650.00 0.566
700 CCA Prison Realty Trust 14,350.00 0.393
800 CenterPoint Properties Trust 27,050.00 0.741
900 Chateau Communities Inc. 26,381.25 0.723
500 Chelsea GCA Realty 17,812.50 0.488
800 Colonial Properties Trust 21,300.00 0.583
900 Commercial Net Lease Realty 11,925.00 0.327
3,200 Cornerstone Properties Inc. 50,000.00 1.369
1,400 Cornerstone Realty Income Trust 14,700.00 0.403
1,000 Cousins Properties 32,250.00 0.883
3,800 Crescent Real Estate Equity 87,400.00 2.394
1,800 Developers Diversified Realty 31,950.00 0.875
2,600 Duke Realty Investments 60,450.00 1.656
1,300 Dynex Capital 6,012.50 0.165
500 EastGroup Properties SBI 9,218.75 0.252
1,100 Equity Inns 10,587.50 0.290
8,000 Equity Office Properties 192,000.00 5.259
3,800 Equity Residential Properties Trust 153,662.50 4.209
500 Essex Property Trust 14,875.00 0.407
1,300 Federal Realty Investment Trust SBI 30,712.50 0.841
2,100 Felcor Lodging Trust 48,431.25 1.327
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Ranson Unit Investment Trusts
S&P REIT Index Trust
Series 1
Schedule of Investments
December 31, 1998
Percentage (%)
of Total
Shares Name of Issuer Market Value Market Value
- ------ -------------- ------------ ------------
<S> <C> <C> <C>
1,200 First Industrial RealtyTrust $32,175.00 0.881
1,500 Franchise Finance Corp. 36,000.00 0.986
800 Gables Residential Trust 18,550.00 0.508
1,100 General Growth Properties 41,662.50 1.141
1,000 Glenborough Realty Trust 20,375.00 0.558
700 Glimcher Realty Trust 10,981.25 0.301
1,000 Health Care Property Investments 30,750.00 0.842
900 Health Care REIT, Inc. 23,287.50 0.638
1,300 Healthcare Realty Trust 29,006.25 0.794
1,900 Highwoods Properties 48,925.00 1.340
1,400 Hospitality Properties Trust 33,775.00 0.925
4,200 HRPT Properties Trust 59,062.50 1.618
2,100 IndyMac Mortgage Holdings 22,181.25 0.608
1,100 IRT Property 11,000.00 0.301
600 Irvine Apartment Communities 19,125.00 0.524
1,000 JDN Realty 21,562.50 0.591
600 JP Realty 11,775.00 0.323
900 Kilroy Realty Corporation 20,700.00 0.567
1,800 Kimco Realty 71,437.50 1.957
800 Koger Equity 13,750.00 0.377
300 Kranzco Realty Trust 4,481.25 0.123
1,900 Liberty Property Trust 46,787.50 1.281
900 LTC Properties 14,962.50 0.410
1,000 Macerich Co. 25,625.00 0.702
1,800 Mack-Cali Realty 55,575.00 1.522
800 Manufactured Home Communities 20,050.00 0.549
4,600 Meditrust Corp. 69,000.00 1.890
1,000 Meridian Industrial Trust 23,500.00 0.644
1,400 Meristar Hospitality Corp. 25,987.50 0.712
400 MGI Properties 11,175.00 0.306
600 Mid-America Apartment Communties 13,612.50 0.373
700 Mills Corp. 13,912.50 0.381
1,400 Nationwide Health Properties 30,187.50 0.827
400 National Golf Properties 11,575.00 0.317
800 National Health Investors 19,750.00 0.541
2,800 New Plan Excel Realty Trust 62,125.00 1.702
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Ranson Unit Investment Trusts
S&P REIT Index Trust
Series 1
Schedule of Investments
December 31, 1998
Percentage (%)
of Total
Shares Name of Issuer Market Value Market Value
- ------ -------------- ------------ ------------
<S> <C> <C> <C>
600 Omega Healthcare Investors $18,112.50 0.496
600 Pacific Gulf Properties 12,037.50 0.330
4,600 Patriot American Hospitality 27,600.00 0.756
400 Pennsylvania REIT SBI 7,775.00 0.213
1,100 Post Properties 42,281.25 1.158
1,300 Prentiss Properties Trust 29,006.25 0.794
1,300 Prime Retail, Inc. 12,756.25 0.349
3,900 Prologis Trust 80,925.00 2.216
3,900 Public Storage 105,543.75 2.891
800 Realty Income 19,900.00 0.545
1,300 Reckson Associates Realty 28,843.75 0.790
800 RFS Hotel Investors 9,800.00 0.268
900 Shurgard Storage Centers 23,231.25 0.636
5,200 Simon Property Group, Inc. 148,200.00 4.059
500 Smith(Charles E.)Residential Realty 16,062.50 0.440
400 Sovran Self Storage 10,050.00 0.275
2,000 Spieker Properties 69,250.00 1.897
5,800 Starwood Hotels & Resorts 131,587.50 3.604
500 Storage Trust Realty 11,687.50 0.320
900 Storage USA 29,081.25 0.797
800 Summit Properties 13,800.00 0.378
500 Sun Communities 17,406.25 0.477
1,700 Taubman Centers 23,375.00 0.640
800 TriNet Corporate Realty Trust 21,400.00 0.586
3,300 United Dominion Realty Trust 34,031.25 0.932
600 Urban Shopping Centers 19,650.00 0.538
2,600 Vornado Realty Trust 87,750.00 2.403
600 Walden Residential Properties 12,262.50 0.336
1,100 Washington REIT SBI 20,487.50 0.561
700 Weeks Corporation 19,731.25 0.540
800 Weingarten Realty SBI 35,700.00 0.978
500 Winston Hotels 4,093.75 0.112
$3,651,050.00 100.000
============= =======
</TABLE>
<PAGE>
Ranson Unit Investment Trusts
S&P REIT Index Trust
Series 1
Notes to Financial Statements
1. Significant Accounting Policies
Trust Sponsor and Evaluator
Ranson & Associates, Inc. serves as the Trust's sponsor and evaluator.
Valuation of Investments
Each security is valued at the closing sale price on a national securities
exchange or the Nasdaq National Market.
Cost of Investments
Cost of the Trust's Stocks is based on the offer prices of the Stocks on the
dates of deposits of such Securities acquired during the primary sales period,
as determined by the Evaluator. Realized gain (loss) from investment
transactions is reported on a first-in, first-out basis.
Investment Income
Dividends are recorded on the ex-dividend date.
Organization Costs
Organization Costs in connection with the formation of the Trust amounted to
$16,234. Such costs are being amortized on a straight line basis over five
years.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires the Trust's sponsor to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from such estimates.
2. Unrealized Appreciation and Depreciation
Following is an analysis of net unrealized depreciation at December 31, 1998:
<TABLE>
<CAPTION>
<S> <C>
Gross unrealized appreciation $27,792
Gross unrealized depreciation (323,111)
----------
Net unrealized depreciation $(295,319)
=========
</TABLE>
3. Federal Income Taxes
The Trust is organized as a regulated investment company under Subchapter M of
the Internal Revenue Code of 1986, as amended (the "Code"). It is the Trust's
policy to comply with the special provisions of the Code available to regulated
investment companies. Such provisions were complied with and, therefore, no
federal income tax provision is required.
<PAGE>
Ranson Unit Investment Trusts
S&P REIT Index Trust
Series 1
Notes to Financial Statements (continued)
4. Other Information
Cost to Investors
The cost to original investors of Units of the Trust was based on the aggregate
offering price of the Stocks on the date of an investor's purchase, plus a sales
charge of 4.90% of the Public Offering Price (equivalent to 5.152% of the net
amount invested). The Public Offering Price for secondary market transactions
is based on the aggregate bid price of the Stocks plus or minus a pro rata share
of cash or overdraft in the Principal Account, if any, on the date of an
investor's purchase, plus a sales charge of 4.90% of the Public Offering Price
(equivalent to 5.152% of the net amount invested).
Distributions
Distributions of net investment income to Unitholders are declared and paid
quarterly. Income distributions, on a record date basis, are as follows:
<TABLE>
<CAPTION>
Period from
Distribution March 5, 1998 to
Plan December 31, 1998
----- Per Unit Total
--------- ----------
<S> <C> <C>
Quarterly $.326 $138,652
</TABLE>
In addition, the Trust redeemed Units with proceeds from the sale of Stocks as
follows:
<TABLE>
<CAPTION>
Period from
March 5,
1998 to
December 31,
1998
----------
<S> <C>
Principal portion $6
Net investment income accrued -
----------
$6
=========
Units 1
=========
</TABLE>
<PAGE>
Consent of Independent Auditors
We consent to the reference to our firm under the caption "Independent Auditors"
and to the use of our report dated April 16, 1999, in this Post-Effective
Amendment to the Registration Statement (Form S-6) and related Prospectus of
Ranson Unit Investment Trusts, S&P REIT Index Trust, Series 1 dated April 30,
1999.
Ernst & Young LLP
Kansas City, Missouri
April 30, 1999
<PAGE>
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
<PAGE>
Signatures
Pursuant to the requirements of the Securities Act of 1933, The Registrant,
Ranson Unit Investment Trusts Series 66, certifies that it meets all of the
requirements for effectiveness of this registration statement pursuant to Rule
485(b) under the Securities Act of 1933 and has duly caused this Amendment to
the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Wichita, and State of Kansas, on the
30th day of April, 1999.
Ranson Unit Investment Trusts Series 66
Registrant
By: Ranson & Associates, Inc.
Depositor
By: Robin Pinkerton
President
Pursuant to the requirements of the Securities Act of 1933, this Amendment
to the Registration Statement has been signed below on April 30, 1999 by the
following persons, who constitute a majority of the Board of Directors of Ranson
& Associates, Inc.
Signature Title
Douglas K. Rogers Executive Vice and President and Director
Douglas K. Rogers
Alex R. Meitzner Chairman of the Board and Director
Alex R. Meitzner
Robin K. Pinkerton President, Secretary, Treasurer and
Robin K. Pinkerton Director
Robin Pinkerton
An executed copy of each of the related powers of attorney was filed with
the Securities and Exchange Commission in connection with the Registration
Statement on Form S-6 of The Kansas Tax-Exempt Trust, Series 51 (File No. 33-
46376) and Series 52 (File No. 33-47687) and the same are hereby incorporated
herein by this reference.
