Registration No. 33-53273
1940 Act No. 811-05903
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 2 to Form S-6
FOR REGISTRATION UNDER THE SECURITIES ACT OF 1933 OF SECURITIES
OF UNIT INVESTMENT TRUSTS REGISTERED ON FORM N-8B-2
A. Exact name of trust:
The First Trust Special Situations Trust, Series 93
B. Name of depositor:
NIKE SECURITIES L.P.
C. Complete address of depositor's principal executive offices:
NIKE SECURITIES L.P.
1001 Warrenville Road
Lisle, Illinois 60532
D. Name and complete address of agent for service:
Copy to:
JAMES A. BOWEN ERIC F. FESS
c/o Nike Securities L.P. c/o Chapman and Cutler
1001 Warrenville Road 111 West Monroe Street
Lisle, Illinois 60532 Chicago, Illinois 60603
E. Title and Amount of Securities Being Registered:
An indefinite number of Units pursuant to Rule 24f-2
promulgated under the Investment Company Act of 1940, as amended
F. Proposed Maximum Aggregate Offering Price to the Public of
the Securities Being Registered:
Indefinite
G. Amount of Filing Fee (as required by Rule 24f-2):
$500.00*
H. Approximate date of proposed sale to public:
|XXX|Check box if it is proposed that this filing will become
effective on December 8, 1994 at 2:00 p.m. pursuant to Rule
487.
*Previously paid
THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 93
Cross-Reference Sheet
(Form N-8B-2 Items required by Instructions as
to the Prospectus in Form S-6)
FORM N-8B-2 ITEM NUMBER FORM S-6 HEADING IN PROSPECTUS
I. ORGANIZATION AND GENERAL INFORMATION
1. (a) Name of trust Prospectus front cover
(b) Title of securities issued Summary of Essential
Information
2. Name and address of each depositor Information as to
Sponsor, Trustee and
Evaluator
3. Name and address of trustee Information as to
Sponsor, Trustee and
Evaluator
4. Name and address of principal Information as to
underwriters Sponsor, Trustee and
Evaluator
5. State of organization of trust The First Trust
Special Situations
Trust
6. Execution and termination of Other Information
trust agreement
7. Changes of name *
8. Fiscal year *
9. Litigation *
II. GENERAL DESCRIPTION OF THE TRUST AND SECURITIES OF THE TRUST
10. (a) Registered or bearer Public Offering
securities
(b) Cumulative or distributive The First Trust
securities Special Situations
Trust
(c) Redemption Rights of Unitholders
(d) Conversion, transfer, etc. Rights of Unitholders
(e) Periodic payment plan *
(f) Voting rights Rights of Unitholders
(g) Notice of certificateholders Other Information
(h) Consents required Rights of Unitholders;
Other Information
(i) Other provisions The First Trust
Special Situations
Trust
11. Types of securities comprising The First Trust
units Special
Situations Trust
Schedule of
Investments
12. Certain information regarding
periodic payment certificates *
13. (a) Load, fees, expenses, etc. Summary of Essential
Information; Public
Offering; The First
Trust Special
Situations Trust
(b) Certain information regarding
periodic payment certificates *
(c) Certain percentages Summary of Essential
Information; The
First Trust Special
Situations Trust;
Public Offering
(d) Certain other fees, etc.
payable by holders Rights of Units
Holders
(e) Certain profits receivable
by depositor, principal,
underwriters, trustee or The First Trust
affiliated persons Special
Situations Trust
(f) Ratio of annual charges *
to income
14. Issuance of trust's securities Rights of Unit Holders
15. Receipt and handling of payments
from purchasers *
16. Acquisition and disposition of
underlying securities The First Trust
Special Situations
Trust; Rights of Unit
Holders;
17. Withdrawal or redemption The First Trust
Special Situations
Trust; Public
Offering; Rights of
Unit Holders
18. (a) Receipt, custody and Rights of Unit Holders
disposition of income
(b) Reinvestment of distributions Rights of Unit Holders
(c) Reserves or special funds Information as to
Sponsor, Trustee and
Evaluator
(d) Schedule of distributions *
19. Records, accounts and reports Rights of Unit Holders
20. Certain miscellaneous provisions
of trust agreement
(a) Amendment Other Information
(b) Termination Other Information
(c) and (d) Trustee, removal Information as
and successor to Sponsor, Trustee
and Evaluator
(e) and (f) Depositor, removal Information as
and successor to Sponsor, Trustee
and Evaluator
21. Loans to security holders *
22. Limitations on liability The First Trust
Special Situations
Trust;
Information as to
Sponsor, Trustee
and Evaluator
23. Bonding arrangements Contents of
Registration
Statement
24. Other material provisions *
of trust agreement
III. ORGANIZATION, PERSONNEL AND AFFILIATED PERSONS OF DEPOSITOR
25. Organization of depositor Information as to
Sponsor, Trustee and
Evaluator
26. Fees received by depositor *
27. Business of depositor Information as to
Sponsor, Trustee and
Evaluator
28. Certain information as to
officials and affiliated *
persons of depositor
29. Voting securities of depositor *
30. Persons controlling depositor *
31. Payment by depositor for certain
services rendered to trust *
32. Payment by depositor for certain
other services rendered to trust *
33. Remuneration of employees of
depositor for certain services
rendered to trust *
34. Remuneration of other persons
for certain services rendered *
to trust
IV. DISTRIBUTION AND REDEMPTION
35. Distribution of trust's Public Offering
securities by states
36. Suspension of sales of trust's
securities *
37. Revocation of authority to *
distribute
38. (a) Method of distribution Public Offering
(b) Underwriting agreements Public Offering
(c) Selling agreements Public Offering
39. (a) Organization of principal Information as
underwriters to Sponsor, Trustee
and Evaluator
(b) N.A.S.D. membership of
principal underwriters Information as to
Sponsor, Trustee and
Evaluator
40. Certain fees received by See Items 13(a) and
principal underwriters 13(e)
41. (a) Business of principal Information as to
underwriters Sponsor, Trustee and
Evaluator
(b) Branch offices of
principal underwriters *
(c) Salesmen of principal *
underwriters
42. Ownership of trust's securities
by certain persons *
43. Certain brokerage commissions
received by principal *
underwriters
44. (a) Method of valuation Summary of Essential
Information; The
First Trust Special
Situations Trust,
Public Offering
(b) Schedule as to offering *
price
(c) Variation in offering Public Offering
price to certain persons
45. Suspension of redemption rights *
46. (a) Redemption valuation Rights of Unit Holders
(b) Schedule as to redemption *
price
47. Maintenance of position in Public Offering;
underlying securities Rights
of Unit Holders
V. INFORMATION CONCERNING THE TRUSTEE OR CUSTODIAN
48. Organization and regulation of Information as
trustee to Sponsor, Trustee
and Evaluator
49. Fees and expenses of trustee The First Trust
Special Situations
Trust
50. Trustee's lien The First Trust
Special Situations
Trust
VI. INFORMATION CONCERNING THE INSURANCE OF HOLDERS OF
SECURITIES
51. Insurance of holders of
trust's ecurities *
VII. POLICY OF REGISTRANT
52. (a) Provisions of trust The First Trust
agreement with respect to Special
selection or elimination of Situations Trust;
underlying securities Rights of Unit Holders
(b) Transactions involving
elimination of underlying *
securities
(c) Policy regarding substitution The First Trust
or elimination of underlying Special
securities Situations Trust;
Rights of Unit Holders
(d) Fundamental policy not
otherwise covered *
53. Tax status of Trust The First Trust
Special Situations
Trust
VIII. FINANCIAL AND STATISTICAL INFORMATION
54. Trust's securities during *
last ten years
55.
56.
57. Certain information regarding
period payment certificates *
58.
59. Financial statements Report of Independent
(Instruction 1(c) to Auditors
Form S-6) Statement of Net
Assets
* Inapplicable, answer negative or not required.
Telephone Growth Trust, Series 3
Telephone Growth & Treasury Securities Trust, Series 4
The First Trust (registered trademark) Special Situations Trust,
Series 93 consists of the underlying separate unit investment
trusts set forth above. The various trusts are sometimes collectively
referred to herein as the "Trusts." The Telephone Growth Trust,
Series 3 is sometimes individually referred to herein as the "Growth
Trust." The Telephone Growth & Treasury Securities Trust, Series
4 is sometimes individually referred to herein as the "Growth
& Treasury Trust."
The Growth Trust consists of a portfolio solely containing common
stocks issued by companies in the telephone industry, including
common stocks of foreign issuers in American Depositary Receipt
("ADR") form. The Growth & Treasury Trust consists of a portfolio
containing zero coupon U.S. Treasury bonds and common stocks of
companies in the telephone industry, including common stocks of
foreign issuers in American Depositary Receipt ("ADR") form. See
"What are Equity Securities?"
The objective of the Growth Trust is to provide potential capital
appreciation and income by investing the Trust's portfolio in
common stocks issued by companies in the telephone industry ("Equity
Securities"). Such Equity Securities are sometimes also referred
to herein as the "Securities." Each Unit of the Growth Trust represents
an undivided fractional interest in all the Equity Securities
deposited in the Trust. See "Schedule of Investments" for the
Growth Trust. The Growth Trust has a mandatory termination date
(the "Mandatory Termination Date" or "Trust Ending Date") as set
forth under "Summary of Essential Information." There is, of course,
no guarantee that the objective of the Growth Trust will be achieved.
The objective of the Growth & Treasury Trust is to protect Unit
holders' capital and provide potential capital appreciation and
income by investing a portion of its portfolio in zero coupon
U.S. Treasury bonds ("Treasury Obligations") and the remainder
of the Trust's portfolio in common stocks issued by companies
in the telephone industry ("Equity Securities"). Collectively,
the Treasury Obligations and the Equity Securities are referred
to herein as the "Securities." See "Schedule of Investments" for
the Growth & Treasury Trust. The Growth & Treasury Trust has a
mandatory termination date (the "Mandatory Termination Date" or
"Trust Ending Date") as set forth under "Summary of Essential
Information." The Treasury Obligations evidence the right to receive
a fixed payment at a future date from the U.S. Government and
are backed by the full faith and credit of the U.S. Government.
The guarantee of the U.S. Government does not apply to the market
value of the Treasury Obligations or the Units of the Trust, whose
net asset value will fluctuate and, prior to maturity, may be
worth more or less than a purchaser's acquisition cost. The Growth
& Treasury Trust is intended to achieve its objective over the
life of the Trust and as such, is best suited for those investors
capable of holding such Units to maturity. There is, of course,
no guarantee that the objective of the Growth & Treasury Trust
will be achieved.
Each Unit of the Growth & Treasury Trust represents an undivided
fractional interest in all the Securities deposited in the Trust.
The Growth & Treasury Trust has been organized so that purchasers
of Units should receive, at the termination of the Trust, an amount
per Unit at least equal to $10.00 (which is equal to the per Unit
value upon maturity of the Treasury Obligations), even if such
Trust never paid a dividend and the value of the Equity Securities
were to decrease to zero, which the Sponsor considers highly unlikely.
This feature of the Growth & Treasury Trust provides Unit holders
who purchase Units at a price of $10.00 or less per Unit
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.
First Trust (registered trademark)
The date of this Prospectus is December 8, 1994
Page 1
with total principal protection, including any sales charges paid,
although they might forego any earnings on the amount invested.
To the extent that Units are purchased at a price less than $10.00
per Unit, this feature may also provide a potential for capital
appreciation. As a result of the volatile nature of the market
for zero coupon U.S. Treasury bonds, Units sold or redeemed prior
to maturity will fluctuate in price and the underlying Treasury
Obligations may be valued at a price greater or less than their
value as of the Initial Date of Deposit. UNIT HOLDERS DISPOSING
OF THEIR UNITS PRIOR TO THE MATURITY OF THE TRUST MAY RECEIVE
MORE OR LESS THAN $10.00 PER UNIT, DEPENDING ON MARKET CONDITIONS
ON THE DATE UNITS ARE SOLD OR REDEEMED.
The Treasury Obligations deposited in the Growth & Treasury Trust
on the Initial Date of Deposit will mature on February 15, 2005
(the "Treasury Obligations Maturity Date"). The Treasury Obligations
in the Growth & Treasury Trust have a maturity value equal to
or greater than the aggregate Public Offering Price (which includes
the sales charge) of the Units of the Trust on the Initial Date
of Deposit. The Equity Securities deposited in the Trust's portfolio
have no fixed maturity date and the value of these underlying
Equity Securities will fluctuate with changes in the values of
stocks in general and with changes in the conditions and performance
of the specific Securities owned by the Trust. See "Portfolio."
With respect to the Growth Trust, the Sponsor may, from time to
time during a period of up to approximately 360 days after the
Initial Date of Deposit, deposit additional Equity Securities
in the Trust. Such deposits of additional Equity Securities will,
therefore, be done in such a manner that the original proportionate
relationship amongst the individual issues of the Equity Securities
shall be maintained. Any deposit by the Sponsor of additional
Equity Securities will duplicate, as nearly as is practicable,
the original proportionate relationship established on the Initial
Date of Deposit, and not the actual proportionate relationship
on the subsequent date of deposit, since the actual proportionate
relationship may be different than the original proportionate
relationship. Any such difference may be due to the sale, redemption
or liquidation of any Equity Securities deposited in the Trust
on the Initial, or any subsequent, Date of Deposit. See "What
is The First Trust Special Situations Trust?" and "How May Securities
be Removed from the Trusts?"
With respect to the Growth & Treasury Trust, the Sponsor may,
from time to time during a period of up to approximately 360 days
after the Initial Date of Deposit, deposit additional Securities
in the Trust, provided it maintains the original percentage relationship
between the Treasury Obligations and Equity Securities in the
Trust's portfolio. Such deposits of additional Securities will,
therefore, be done in such a manner that the maturity value of
each Unit should always be an amount at least equal to $10.00,
and that the original proportionate relationship amongst the individual
issues of the Equity Securities in the Trust shall be maintained.
Any deposit by the Sponsor of additional Securities will duplicate,
as nearly as is practicable, the original proportionate relationship
established on the Initial Date of Deposit, and not the actual
proportionate relationship on the subsequent date of deposit,
since the actual proportionate relationship may be different than
the original proportionate relationship. Any such difference may
be due to the sale, redemption or liquidation of any Securities
deposited in the Trust on the Initial, or any subsequent, Date
of Deposit. See "What is the First Trust Special Situations Trust?"
and "How May Securities be Removed from the Trusts?"
Public Offering Price. With respect to the Growth Trust, the Public
Offering Price per Unit of the Trust during the initial offering
period is equal to the aggregate underlying value of the Equity
Securities in the Trust (generally determined by the closing sale
prices of listed Equity Securities and the ask prices of over-the-counter
traded Equity Securities) plus or minus a pro rata share of cash,
if any, in the Capital and Income Accounts of the Trust, plus
a maximum sales charge of 4.9% (equivalent to 5.152% of the net
amount invested). A pro rata share of accumulated dividends, if
any, in the Income Account is included in the Public Offering
Price. The secondary market Public Offering Price per Unit will
be based upon the aggregate underlying value of the Equity Securities
in the Trust (generally determined by the closing sale prices
of listed Equity Securities and the bid prices of over-the-counter
traded Equity Securities) plus or minus a pro rata share of cash,
if any, in the Capital and Income Accounts of the Trust plus a
maximum sales charge of 4.9% (equivalent to 5.152% of the net
amount invested) subject to a reduction beginning January 1, 1996.
With respect to the Growth & Treasury Trust, the Public Offering
Price per Unit of the Trust during the initial offering period
is equal to a pro rata share of the offering prices of the Treasury
Obligations and the aggregate underlying value of the Equity Securities
in the Trust (generally determined by the closing sale prices
Page 2
of listed Equity Securities and the ask prices of over-the-counter
traded Equity Securities) plus or minus a pro rata share of cash,
if any, in the Capital and Income Accounts of the Trust, plus
a maximum sales charge of 5.5% (equivalent to 5.820% of the net
amount invested). A pro rata share of accumulated dividends, if
any, in the Income Account is included in the Public Offering
Price. The secondary market Public Offering Price per Unit will
be based upon a pro rata share of the bid prices of the Treasury
Obligations and the aggregate underlying value of the Equity Securities
in the Trust (generally determined by the closing sale prices
of listed Equity Securities and the bid prices of over-the-counter
traded Equity Securities) plus or minus a pro rata share of cash,
if any, in the Capital and Income Accounts of the Trust plus a
maximum sales charge of 5.5% (equivalent to 5.820% of the net
amount invested) subject to a reduction beginning January 1, 1996.
The minimum purchase for each Trust is $1,000. The sales charge
is reduced on a graduated scale for sales involving at least 5,000
Units with respect to the Growth Trust and 10,000 Units with respect
to the Growth & Treasury Trust. See "How is the Public Offering
Price Determined?"
Estimated Net Annual Distributions. The estimated net annual dividend
distributions to Unit holders (based on the most recent dividend
declared with respect to the Equity Securities in the Trusts)
at the opening of business on the Initial Date of Deposit was
$.2279 per Unit for the Telephone Growth Trust, Series 3 and $.1032
per Unit for the Telephone Growth & Treasury Securities Trust,
Series 4. The actual net annual dividend distributions per Unit
will vary with changes in fees and expenses of the Trusts, with
changes in dividends received and with the sale or liquidation
of Equity Securities; therefore, there is no assurance that the
net annual dividend distributions will be realized in the future.
Dividend and Capital Gains Distributions. Distributions of dividends
received, and realized capital gains, if any, received by each
Trust will be paid in cash on the Distribution Date to Unit holders
of record on the Record Date as set forth in the "Summary of Essential
Information." Any distribution of income and/or capital gains
will be net of the expenses of such Trust. Distribution of funds
in the Capital Account, if any, will be made at least annually
in December of each year. Income with respect to the accrual of
original issue discount on the Treasury Obligations in the Growth
& Treasury Trust will not be distributed currently, although Unit
holders of the Growth & Treasury Trust will be subject to income
tax at ordinary income rates as if a distribution had occurred.
INCOME WITH RESPECT TO THE ACCRUAL OF ORIGINAL ISSUE DISCOUNT
ON THE TREASURY OBLIGATIONS IN THE GROWTH & TREASURY TRUST WILL
NOT BE DISTRIBUTED CURRENTLY, ALTHOUGH UNIT HOLDERS OF THE GROWTH
& TREASURY TRUST WILL BE SUBJECT TO INCOME TAX AT ORDINARY INCOME
RATES AS IF A DISTRIBUTION HAD OCCURRED. See "What is the Federal
Tax Status of Unit Holders?" Additionally, upon termination of
each Trust, the Trustee will distribute, upon surrender of Units
for redemption, to each Unit holder his pro rata share of such
Trust's assets, less expenses, in the manner set forth under "Rights
of Unit Holders-How are Income and Capital Distributed?"
Secondary Market for Units. After the initial offering period,
while under no obligation to do so, the Sponsor may maintain a
market for Units of each Trust and offer to repurchase such Units,
in the case of the Growth Trust, at prices which are based on
the aggregate underlying value of the Equity Securities in the
Trust (generally determined by the closing sale prices of listed
Equity Securities and the bid prices of over-the-counter traded
Equity Securities) plus or minus cash, if any, in the Capital
and Income Accounts of the Trust; in the case of the Growth &
Treasury Trust, at prices which are based on the aggregate bid
side evaluation of the Treasury Obligations and the aggregate
underlying value of Equity Securities in the Trust (generally
determined by the closing sale prices of listed Equity Securities
and the bid prices of over-the-counter traded Equity Securities)
plus or minus cash, if any, in the Capital and Income Accounts
of the Trust. In the case of the Growth Trust, if a secondary
market is maintained during the initial offering period, the prices
at which Units will be repurchased will also be based on the aggregate
underlying value of the Equity Securities in the Trust (generally
determined by the closing sale prices of listed Equity Securities
and the ask prices of over-the-counter traded Equity Securities)
plus or minus cash, if any, in the Capital and Income Accounts
of the Trust. If a secondary market is maintained during the initial
offering period, in the case of the Growth & Treasury Trust, the
prices at which Units will be repurchased will be based upon the
aggregate offering side evaluation of the Treasury Obligations
and the aggregate underlying value of the Equity Securities in
the Trust (generally determined by the closing sale prices of
listed Equity Securities and the ask prices of over-the-counter
traded Equity Securities) plus or minus cash, if any, in the Capital
and Income Accounts of the Trust. In the case of the Growth Trust,
if a secondary market is not maintained, a Unit holder
Page 3
may redeem Units through redemption at prices based on the aggregate
underlying value of the Equity Securities in the Trust (generally
determined by the closing sale prices of listed Equity Securities
and the bid prices of over-the-counter traded Equity Securities)
plus or minus cash, if any, in the Capital and Income Accounts
of the Trust. If a secondary market is not maintained, a Unit
holder may redeem Units of the Growth & Treasury Trust through
redemption at prices based upon the aggregate bid price of the
Treasury Obligations plus the aggregate underlying value of the
Equity Securities in the Trust (generally determined by the closing
sale prices of listed Equity Securities and the bid prices of
over-the-counter traded Equity Securities) plus or minus a pro
rata share of cash, if any, in the Capital and Income Accounts
of the Trust. With respect to the Growth Trust, a Unit holder
tendering 2,500 Units or more for redemption may request a distribution
of shares of Equity Securities (reduced by customary transfer
and registration charges) in lieu of payment in cash. See "How
May Units be Redeemed?"
Termination. Commencing on the Mandatory Termination Date for
the Growth Trust and on the Treasury Obligations Maturity Date
for the Growth & Treasury Trust, Equity Securities will begin
to be sold in connection with the termination of each Trust. The
Sponsor will determine the manner, timing and execution of the
sale of the Equity Securities. Written notice of any termination
of a Trust specifying the time or times at which Unit holders
may surrender their certificates for cancellation shall be given
by the Trustee to each Unit holder at his address appearing on
the registration books of such Trust maintained by the Trustee.
At least 60 days prior to the Mandatory Termination Date for the
Growth Trust and at least 60 days prior to the Treasury Obligations
Maturity Date for the Growth & Treasury Trust, the Trustee will
provide written notice thereof to all Unit holders and will include
with such notice a form to enable Unit holders to elect a distribution
of shares of Equity Securities (reduced by customary transfer
and registration charges) if such Unit holder owns at least 2,500
Units of such Trust, rather than to receive payment in cash for
such Unit holder's pro rata share of the amounts realized upon
the disposition by the Trustee of Equity Securities. All Unit
holders of the Growth & Treasury Trust will receive their pro
rata portion of the Treasury Obligations in cash upon the termination
of the Trust. To be effective, the election form, together with
surrendered certificates and other documentation required by the
Trustee, must be returned to the Trustee at least five business
days prior to the Mandatory Termination Date for the Growth Trust,
and at least five business days prior to the Treasury Obligations
Maturity Date for the Growth & Treasury Trust. Unit holders not
electing a distribution of shares of Equity Securities will receive
a cash distribution from the sale of the remaining Securities
within a reasonable time after each Trust is terminated. See "Rights
of Unit Holders-How are Income and Capital Distributed?"
Risk Factors. An investment in the Trusts should be made with
an understanding of the risks associated therewith, including,
among other factors, the possible deterioration of either the
financial condition of the issuers or the general condition of
the stock market, volatile interest rates, governmental regulations,
currency exchange fluctuations or an economic recession. The Trusts
are not actively managed and Securities will not be sold by either
Trust to take advantage of market fluctuations or changes in anticipated
rates of appreciation. See "What are Equity Securities?-Risk Factors."
Page 4
Summary of Essential Information
At the Opening of Business on the Initial Date of Deposit
of the Securities-December 8, 1994
Sponsor: Nike Securities L.P.
Trustee: United States Trust Company of New York
Evaluator: First Trust Advisors L.P.
<TABLE>
<CAPTION>
Telephone
Growth
Trust
Series 3
_________
General Information
<S> <C>
Initial Number of Units 50,000
Fractional Undivided Interest in the Trust per Unit 1/50,000
Public Offering Price:
Aggregate Offering Price Evaluation of Equity Securities in Portfolio (1) $ 474,245
Aggregate Offering Price Evaluation per Unit $ 9.4849
Sales Charge (2) $ .4887
Public Offering Price per Unit (3) $ 9.9736
Sponsor's Initial Repurchase Price per Unit $ 9.4849
Redemption Price per Unit (4) $ 9.4849
</TABLE>
CUSIP Number 33734W 673
First Settlement Date December 15, 1994
Mandatory Termination Date December 31, 2001
Discretionary Liquidation Amount The Trust may be terminated if
the value thereof is less than
the lower of $2,000,000 or 20%
of the total value of Equity
Securities deposited in the
Trust during the primary
offering period.
Trustee's Annual Fee $0.0090 per Unit outstanding.
Evaluator's Annual Fee $0.0030 per Unit outstanding, payable
to an affiliate of the Sponsor.
Evaluations for purposes of sale,
purchase or redemption of Units are
made as of the close of trading
(4:00 p.m. Eastern time) on the New
York Stock Exchange on each day on
which it is open.
Supervisory Fee (5) Maximum of $0.0025 per Unit outstanding
annually payable to an affiliate of the
Sponsor.
Income Distribution Record Date Fifteenth day of each March,
June, September and December commencing
March 15, 1995.
Income Distribution Date (6) Last day of each March, June,
September and December commencing
March 31, 1995.
[FN]
________________
(1) Each Equity Security listed on a national securities exchange
or the NASDAQ National Market System is valued at the last closing
sale price, or if no such price exists or if the Equity Security
is not so listed, at the closing ask price thereof.
(2) Sales charge of 4.9% of the Public Offering Price per Unit
(5.152% of the net amount invested).
(3) On the Initial Date of Deposit there will be no accumulated
dividends in the Income Account. Anyone ordering Units after such
date will pay a pro rata share of any accumulated dividends in
such Income Account. The Public Offering Price as shown reflects
the value of the Equity Securities at the opening of business
on the Initial Date of Deposit and establishes the original proportionate
relationship amongst the individual securities. No sales to investors
will be executed at this price. Additional Equity Securities will
be deposited during the day of the Initial Date of Deposit which
will be valued as of 4:00 p.m. Eastern time and sold to investors
at a Public Offering Price per Unit based on this valuation.
(4) Redemption price per Unit (based on the aggregate underlying
value of Equity Securities) is $.4887 less than Public Offering
Price per Unit. See "How May Units be Redeemed?"
(5) In addition, the Sponsor will be reimbursed for bookkeeping
and other administrative expenses currently at a maximum annual
rate of $0.0010 per Unit.
(6) Distributions from the Capital Account will be made monthly
payable on the last day of the month to Unit holders of record
on the fifteenth day of such month if the amount available for
distribution equals at least $0.01 per Unit. Notwithstanding,
distributions of funds in the Capital Account, if any, will be
made in December of each year.
Page 5
Summary of Essential Information
At the Opening of Business on the Initial Date of Deposit
of the Securities-December 8, 1994
Sponsor: Nike Securities L.P.
Trustee: United States Trust Company of New York
Evaluator: First Trust Advisors L.P.
<TABLE>
<CAPTION>
Telephone
Growth & Treasury
Securities Trust
Series 4
_________________
General Information
<S> <C>
Aggregate Maturity Value of Treasury Obligations Initially Deposited $ 500,000
Initial Number of Units 50,000
Fractional Undivided Interest in the Trust per Unit 1/50,000
Public Offering Price:
Aggregate Offering Price Evaluation of Securities in Portfolio (1) $ 464,003
Aggregate Offering Price Evaluation of Securities per Unit $ 9.2801
Sales Charge (2) $ .5401
Public Offering Price per Unit (3) $ 9.8202
Sponsor's Initial Repurchase Price per Unit $ 9.2801
Redemption Price per Unit (4) $ 9.2668
</TABLE>
CUSIP Number 33734W 681
First Settlement Date December 15, 1994
Treasury Obligations Maturity Date February 15, 2005
Mandatory Termination Date February 15, 2005
Trustee's Annual Fee $0.0090 per Unit outstanding.
Evaluator's Annual Fee $0.0030 per Unit outstanding, payable
to an affiliate of the Sponsor.
Evaluations for purposes of sale,
purchase or redemption of Units are
made as of the close of trading (4:00
p.m. Eastern time) on the New York
Stock Exchange on each day on which it
is open.
Supervisory Fee (5) Maximum of $0.0025 per Unit outstanding
annually payable to an affiliate of the
Sponsor.
Income Distribution Record Date Fifteenth day of each June
and December commencing June 15, 1995.
Income Distribution Date (6) Last day of each June and December
commencing June 30, 1995.
[FN]
________________
(1) Each Equity Security listed on a national securities exchange
or the NASDAQ National Market System is valued at the last closing
sale price, or if no such price exists or if the Equity Security
is not so listed, at the closing ask price thereof. The Treasury
Obligations are valued at their aggregate offering side evaluation.
(2) Sales charge of 5.5% of the Public Offering Price per Unit
(5.820% of the net amount invested).
(3) On the Initial Date of Deposit there will be no accumulated
dividends in the Income Account. Anyone ordering Units after such
date will pay a pro rata share of any accumulated dividends in
such Income Account. The Public Offering Price as shown reflects
the value of the Securities at the opening of business on the
Initial Date of Deposit and establishes the original proportionate
relationship amongst the individual securities. No sales to investors
will be executed at this price. Additional Securities will be
deposited during the day of the Initial Date of Deposit which
will be valued as of 4:00 p.m. Eastern time and sold to investors
at a Public Offering Price per Unit based on this valuation.
(4) Redemption price per Unit (based on bid price evaluation
of underlying Treasury Obligations and aggregate underlying value
of Equity Securities) is $.5534 less than the Public Offering
Price per Unit and $.0133 less than Sponsor's Initial Repurchase
Price per Unit. See "How May Units be Redeemed?"
(5) In addition, the Sponsor will also be reimbursed for bookkeeping
and other administrative expenses currently at a maximum annual
rate of $0.0010 per Unit.
(6) Distributions from the Capital Account will be made monthly
payable on the last day of the month to Unit holders of record
on the fifteenth day of such month if the amount available for
distribution equals at least $0.01 per Unit. Notwithstanding,
distributions of funds in the Capital Account, if any, will be
made in December of each year.
Page 6
Telephone Growth Trust, Series 3
Telephone Growth & Treasury Securities Trust, Series 4
The First Trust Special Situations Trust, Series 93
What is The First Trust Special Situations Trust?
The First Trust Special Situations Trust, Series 93 is one of
a series of investment companies created by the Sponsor under
the name of The First Trust Special Situations Trust, all of which
are generally similar but each of which is separate and is designated
by a different series number. This Series consists of the underlying
separate unit investment trusts designated as: Telephone Growth
Trust, Series 3, and Telephone Growth & Treasury Securities Trust,
Series 4 (collectively, the "Trusts" and each, individually, a
"Trust"). The Telephone Growth Trust, Series 3 is sometimes individually
referred to herein as the "Growth Trust." The Telephone Growth
& Treasury Securities Trust, Series 4 is sometimes individually
referred to herein as the "Growth & Treasury Trust." The Series
was created under the laws of the State of New York pursuant to
a Trust Agreement (the "Indenture"), dated the Initial Date of
Deposit, with Nike Securities L.P., as Sponsor, United States
Trust Company of New York, as Trustee and First Trust Advisors
L.P., as Portfolio Supervisor and Evaluator.
The Telephone Growth Trust Series 3 consists of a portfolio containing
only common stocks issued by companies in the telephone industry,
including common stocks of foreign issuers in American Depositary
Receipt ("ADR") form. See "What are Equity Securities?" The Telephone
Growth & Treasury Securities Trust, Series 4 consists of a portfolio
containing zero coupon U.S. Treasury bonds and common stocks issued
by companies in the telephone industry, including common stocks
of foreign issuers in American Depositary Receipt ("ADR") form.
See "What are Equity Securities?"
On the Initial Date of Deposit, the Sponsor deposited with the
Trustee confirmations of contracts for the purchase of zero coupon
U.S. Treasury bonds and common stocks (in the case of the Growth
Trust, only confirmations of contracts for the purchase of common
stocks), together with an irrevocable letter or letters of credit
of a financial institution in an amount at least equal to the
purchase price of such securities. In exchange for the deposit
of securities or contracts to purchase securities in each Trust,
the Trustee delivered to the Sponsor documents evidencing the
entire ownership of each Trust.
The objective of the Growth Trust is to provide potential capital
appreciation and income by investing the Trust's portfolio in
common stocks issued by companies in the telephone industry which
are considered, in the view of the Sponsor, to be undervalued
at the Initial Date of Deposit ("Equity Securities"). Such Equity
Securities are sometimes also referred to herein as the "Securities."
Each Unit of the Growth Trust represents an undivided fractional
interest in all the Equity Securities deposited in the Trust.
See "Schedule of Investments" for the Growth Trust. The Growth
Trust has a Mandatory Termination Date as set forth under "Summary
of Essential Information." There is, of course, no guarantee that
the objective of the Growth Trust will be achieved.
The objective of the Growth & Treasury Trust is to protect Unit
holders' capital and provide potential capital appreciation and
income by investing a portion of its portfolio in zero coupon
U.S. Treasury bonds ("Treasury Obligations") and the remainder
of the Trust's portfolio in common stocks issued by companies
in the telephone industry which are considered, in the view of
the Sponsor, to be undervalued at the Initial Date of Deposit
("Equity Securities"). Collectively, the Treasury Obligations
and the Equity Securities are referred to herein as the "Securities."
See "Schedule of Investments" for the Growth & Treasury Trust.
The Growth & Treasury Trust has a Mandatory Termination Date as
set forth under "Summary of Essential Information." The Treasury
Obligations evidence the right to receive a fixed payment at a
future date from the U.S. Government and are backed by the full
faith and credit of the U.S. Government. The guarantee of the
U.S. Government does not apply to the market value of the Treasury
Obligations or the Units of the Trust, whose net asset values
will fluctuate and, prior to maturity, may be worth more or less
than a purchaser's acquisition cost. There is, of course, no guarantee
that the objective of the Growth & Treasury Trust will be achieved.
Page 7
With respect to the Growth Trust, with the deposit of Equity Securities
on the Initial Date of Deposit, the Sponsor established a percentage
relationship between the amounts of Equity Securities in the Trust's
portfolio. With the deposit of the Securities in the Growth &
Treasury Trust on the Initial Date of Deposit, the Sponsor established
a percentage relationship between the principal amounts of Treasury
Obligations and Equity Securities in the Trust's portfolio. From
time to time following the Initial Date of Deposit, the Sponsor,
pursuant to the Indenture, may deposit additional Securities in
a Trust and Units may be continuously offered for sale to the
public by means of this Prospectus, resulting in a potential increase
in the outstanding number of Units of a Trust. Any additional
Equity Securities deposited in the Growth Trust will maintain,
as nearly as is practicable, the original proportionate relationship
of the Equity Securities in the Trust's portfolio. Any additional
Securities deposited in the Growth & Treasury Trust will maintain,
as nearly as is practicable, the original proportionate relationship
of the Treasury Obligations and Equity Securities in such Trust's
portfolio. Such deposits of additional Securities in the Growth
& Treasury Trust will, therefore, be done in such a manner that
the maturity value of the Treasury Obligations represented by
each Unit should always be an amount at least equal to $10.00,
and that the original proportionate relationship amongst the individual
issues of the Equity Securities shall be maintained. Any deposit
by the Sponsor of additional Securities in a Trust will duplicate,
as nearly as is practicable, the original proportionate relationship
and not the actual proportionate relationship on the subsequent
date of deposit, since the actual proportionate relationship may
be different than the original proportionate relationship. Any
such difference may be due to the sale, redemption or liquidation
of any of the Securities deposited in a Trust on the Initial,
or any subsequent, Date of Deposit. See "How May Securities be
Removed from the Trusts?" On a cost basis to the Telephone Growth
& Treasury Securities Trust, Series 4, the original percentage
relationship on the Initial Date of Deposit was approximately
48.89% Treasury Obligations and approximately 51.11% Equity Securities.
The original percentage relationship of each Equity Security in
the Trusts is set forth herein under "Schedules of Investments."
Since the prices of the underlying Equity Securities in the Growth
Trust will fluctuate daily, the ratio, on a market value basis,
will also change daily. Likewise, the prices of the underlying
Treasury Obligations and Equity Securities in the Growth & Treasury
Trust will fluctuate daily and the ratio, on a market value basis,
will also change daily. The portion of Equity Securities represented
by each Unit of the Growth Trust will not change as a result of
the deposit of additional Equity Securities in the Growth Trust.
The maturity value of the Treasury Obligations and the portion
of Equity Securities represented by each Unit of the Growth &
Treasury Trust will not change as a result of the deposit of additional
Securities in the Growth & Treasury Trust.
On the Initial Date of Deposit, each Unit of a Trust represented
the undivided fractional interest in the Securities deposited
in such Trust set forth under "Summary of Essential Information."
The Growth & Treasury Trust has been organized so that purchasers
of Units should receive, at the termination of the Trust, an amount
per Unit at least equal to $10.00 per Unit (which is equal to
the per Unit value upon maturity of the Treasury Obligations),
even if the Equity Securities never paid a dividend and the value
of the Equity Securities in the Trust were to decrease to zero,
which the Sponsor considers highly unlikely. Furthermore, the
Sponsor will take such steps in connection with the deposit of
additional Securities in the Growth & Treasury Trust as are necessary
to maintain a maturity value of the Units of the Trust at least
equal to $10.00 per Unit. The receipt of only $10.00 per Unit
upon the termination of the Growth & Treasury Trust (an event
which the Sponsor believes is unlikely) represents a substantial
loss on a present value basis. At current interest rates, the
present value of receiving $10.00 per Unit as of the termination
of the Growth & Treasury Trust would be approximately $4.54 per
Unit (the present value is indicated by the amount per Unit which
is invested in Treasury Obligations). Furthermore, the $10.00
per Unit in no respect protects investors against diminution in
the purchasing power of their investment due to inflation (although
expectations concerning inflation are a component in determining
prevailing interest rates, which in turn determine present values).
If inflation were to occur at the rate of 5% per annum during
the period ending at the termination of the Growth & Treasury
Trust, the present dollar value of $10.00 per Unit at the termination
of the Trust would be approximately $6.02 per Unit. To the extent
that Units of a Trust are redeemed, the aggregate value of the
Securities in such Trust will be reduced and the undivided fractional
interest represented by each outstanding Unit of the Trust will
increase. However, if additional Units are issued by a Trust in
connection with the deposit of additional Securities
Page 8
by the Sponsor, the aggregate value of the Securities in such
Trust will be increased by amounts allocable to additional Units,
and the fractional undivided interest represented by each Unit
of such Trust will be decreased proportionately. See "How May
Units be Redeemed?" The Trusts each have a Mandatory Termination
Date as set forth herein under "Summary of Essential Information."
What are the Expenses and Charges?
At no cost to the Trust, the Sponsor has borne all the expenses
of creating and establishing the Trust, including the cost of
the initial preparation, printing and execution of the Indenture
and the certificates for the Units, legal and accounting expenses,
expenses of the Trustee and other out-of-pocket expenses. With
the exception of bookkeeping and other administrative services
provided to the Trusts, for which the Sponsor will be reimbursed
in amounts as set forth under "Summary of Essential Information,"
the Sponsor will not receive any fees in connection with its activities
relating to the Trusts. Such bookkeeping and administrative charges
may be increased without approval of the Unit holders by amounts
not exceeding proportionate increases under the category "All
Services Less Rent of Shelter" in the Consumer Price Index published
by the United States Department of Labor. The fees payable to
the Sponsor for such services may exceed the actual costs of providing
such services for a Trust, but at no time will the total amount
received for such services rendered to unit investment trusts
of which Nike Securities L.P. is the Sponsor in any calendar year
exceed the aggregate cost to the Sponsor of supplying such services
in such year. First Trust Advisors L.P., an affiliate of the Sponsor,
will receive an annual supervisory fee, which is not to exceed
the amount set forth under "Summary of Essential Information,"
for providing portfolio supervisory services for the Trusts. Such
fee is based on the number of Units outstanding in each Trust
on January 1 of each year except for the year or years in which
an initial offering period occurs in which case the fee for a
month is based on the number of Units outstanding at the end of
such month. The fee may exceed the actual costs of providing such
supervisory services for the Trusts, but at no time will the total
amount received for portfolio supervisory services rendered to
unit investment trusts of which Nike Securities L.P. is the Sponsor
in any calendar year exceed the aggregate cost to First Trust
Advisors L.P. of supplying such services in such year. See "Underwriting."
Subsequent to the initial offering period, the Evaluator, an affiliate
of the Sponsor, will receive a fee as indicated in the "Summary
of Essential Information." The fee may exceed the actual costs
of providing such evaluation services for each Trust, but at no
time will the total amount received for evaluation services rendered
to unit investment trusts of which Nike Securities L.P. is the
Sponsor in any calendar year exceed the aggregate cost to First
Trust Advisors L.P. of supplying such services in such year. The
Trustee pays certain expenses of the Trusts for which it is reimbursed
by each Trust. The Trustee will receive for its ordinary recurring
services to each Trust an annual fee computed at $0.0090 per annum
per Unit in each Trust outstanding based upon the largest aggregate
number of Units of such Trust outstanding at any time during the
year. For a discussion of the services performed by the Trustee
pursuant to its obligations under the Indenture, reference is
made to the material set forth under "Rights of Unit Holders."
The Trustee's and Evaluator's fees are payable from the Income
Account of each Trust to the extent funds are available and then
from the Capital Account of each Trust. Since the Trustee has
the use of the funds being held in the Capital and Income Accounts
for payment of expenses and redemptions and since such Accounts
are noninterest-bearing to Unit holders, the Trustee benefits
thereby. Part of the Trustee's compensation for its services to
each Trust is expected to result from the use of these funds.
Both fees may be increased without approval of the Unit holders
by amounts not exceeding proportionate increases under the category
"All Services Less Rent of Shelter" in the Consumer Price Index
published by the United States Department of Labor.
The following additional charges are or may be incurred by a Trust:
all legal and annual auditing expenses of the Trustee incurred
by or in connection with its responsibilities under the Indenture;
the expenses and costs of any action undertaken by the Trustee
to protect a Trust and the rights and interests of the Unit holders;
fees of the Trustee for any extraordinary services performed under
the Indenture; indemnification of the Trustee for any loss, liability
or expense incurred by it without negligence, bad faith or willful
misconduct on its part, arising out of or in connection with its
acceptance or administration of a Trust; indemnification of the
Sponsor for any loss, liability or expense incurred without gross
negligence, bad faith or willful
Page 9
misconduct in acting as Depositor of a Trust; all taxes and other
government charges imposed upon the Securities or any part of
a Trust (no such taxes or charges are being levied or made or,
to the knowledge of the Sponsor, contemplated). The above expenses
and the Trustee's annual fee, when paid or owing to the Trustee,
are secured by a lien on a Trust. In addition, the Trustee is
empowered to sell Securities in a Trust in order to make funds
available to pay all these amounts if funds are not otherwise
available in the Income and Capital Accounts of a Trust except
that the Trustee shall not sell Treasury Obligations to pay Growth
& Treasury Trust expenses. Since the Equity Securities are all
common stocks and the income stream produced by dividend payments
is unpredictable, the Sponsor cannot provide any assurance that
dividends will be sufficient to meet any or all expenses of the
Trusts. As described above, if dividends are insufficient to cover
expenses, it is likely that Equity Securities will have to be
sold to meet Trust expenses. These sales may result in capital
gains or losses to Unit holders. See "What is the Federal Tax
Status of Unit Holders?"
The Indenture requires the Trusts to be audited on an annual basis
at the expense of each Trust by independent auditors selected
by the Sponsor. So long as the Sponsor is making a secondary market
for the Units, the Sponsor is required to bear the cost of such
annual audits to the extent such cost exceeds $0.005 per Unit.
Unit holders of a Trust covered by an audit may obtain a copy
of the audited financial statements upon request.
What is the Federal Tax Status of Unit Holders?
The following is a general discussion of certain of the Federal
income tax consequences of the purchase, ownership and disposition
of the Units of the Trusts. The summary is limited to investors
who hold the Units as "capital assets" (generally, property held
for investment) within the meaning of Section 1221 of the Internal
Revenue Code of 1986 (the "Code"). Unit holders should consult
their tax advisers in determining the Federal, state, local and
any other tax consequences of the purchase, ownership and disposition
of Units in the Trusts.
In the opinion of Chapman and Cutler, special counsel for the
Sponsor, under existing law:
1. Each Trust is not an association taxable as a corporation
for Federal income tax purposes; each Unit holder will be treated
as the owner of a pro rata portion of the assets of a Trust under
the Code; and the income of each Trust will be treated as income
of the Unit holders thereof under the Code. Each Unit holder will
be considered to have received his pro rata share of income derived
from each Trust asset when such income is received by a Trust.
2. Each Unit holder will have a taxable event when a Trust disposes
of a Security (whether by sale, exchange, redemption or otherwise)
or upon the sale or redemption of Units by such Unit holder. The
price a Unit holder pays for his Units, including sales charges,
is allocated among his pro rata portion of each Security held
by a Trust (in proportion to the fair market values thereof on
the date the Unit holder purchases his Units) in order to determine
his initial cost for his pro rata portion of each Security held
by a Trust. The Treasury Obligations held by the Growth & Treasury
Trust are treated as stripped bonds and may be treated as bonds
issued at an original issue discount as of the date a Unit holder
purchases his Units. Because the Treasury Obligations represent
interests in "stripped" U.S. Treasury bonds, a Unit holder's initial
cost for his pro rata portion of each Treasury Obligation held
by the Growth & Treasury Trust shall be treated as its "purchase
price" by the Unit holder. Original issue discount is effectively
treated as interest for Federal income tax purposes and the amount
of original issue discount in this case is generally the difference
between the bond's purchase price and its stated redemption price
at maturity. A Unit holder of the Growth & Treasury Trust will
be required to include in gross income for each taxable year the
sum of his daily portions of original issue discount attributable
to the Treasury Obligations held by the Trust as such original
issue discount accrues and will in general be subject to Federal
income tax with respect to the total amount of such original issue
discount that accrues for such year even though the income is
not distributed to the Unit holders during such year to the extent
it is not less than a "de minimis" amount as determined under
a Treasury Regulation issued on December 28, 1992 relating to
stripped bonds. To the extent the amount of such discount is less
than the respective "de minimis" amount, such discount shall
Page 10
be treated as zero. In general, original issue discount accrues
daily under a constant interest rate method which takes into account
the semi-annual compounding of accrued interest. In the case of
the Treasury Obligations, this method will generally result in
an increasing amount of income to the Unit holders of the Growth
& Treasury Trust each year. Unit holders of the Growth & Treasury
Trust should consult their tax advisers regarding the Federal
income tax consequences and accretion of original issue discount
under the stripped bond rules. For Federal income tax purposes,
a Unit holder's pro rata portion of dividends, as defined by Section
316 of the Code, paid by a corporation with respect to an Equity
Security held by each Trust are taxable as ordinary income to
the extent of such corporation's current and accumulated "earnings
and profits." A Unit holder's pro rata portion of dividends paid
on such Equity Security which exceed such current and accumulated
earnings and profits will first reduce a Unit holder's tax basis
in such Equity Security, and to the extent that such dividends
exceed a Unit holder's tax basis in such Equity Security shall
generally be treated as capital gain. In general, any such capital
gain will be short term unless a Unit holder has held his Units
for more than one year.
3. A Unit holder's portion of gain, if any, upon the sale or
redemption of Units or the disposition of Securities held by a
Trust will generally be considered a capital gain except in the
case of a dealer or a financial institution and, in general, will
be long-term if the Unit holder has held his Units for more than
one year (the date on which the Units are acquired (i.e., the
trade date) is excluded for purposes of determining whether the
Units have been held for more than one year). A Unit holder's
portion of loss, if any, upon the sale or redemption of Units
or the disposition of Securities held by a Trust will generally
be considered a capital loss except in the case of a dealer or
a financial institution and, in general, will be long-term if
the Unit holder has held his Units for more than one year. Unit
holders should consult their tax advisers regarding the recognition
of such capital gains and losses for Federal income tax purposes.
4. The Code provides that "miscellaneous itemized deductions"
are allowable only to the extent that they exceed two percent
of an individual taxpayer's adjusted gross income. Miscellaneous
itemized deductions subject to this limitation under present law
include a Unit holder's pro rata share of expenses paid by a Trust,
including fees of the Trustee and the Evaluator.
Dividends Received Deduction. A corporation that owns Units will
generally be entitled to a 70% dividends received deduction with
respect to such Unit holder's pro rata portion of dividends received
by a Trust (to the extent such dividends are taxable as ordinary
income, as discussed above) in the same manner as if such corporation
directly owned the Equity Securities paying such dividends (other
than corporate Unit holders, such as "S" corporations, which are
not eligible for the deduction because of their special characteristics
and other than for purposes of special taxes such as the accumulated
earnings tax and the personal holding corporation tax). However,
a corporation owning Units should be aware that Sections 246 and
246A of the Code impose additional limitations on the eligibility
of dividends for the 70% dividends received deduction. These limitations
include a requirement that stock (and therefore Units) must generally
be held at least 46 days (as determined under Section 246(c) of
the Code). Proposed regulations have been issued which address
special rules that must be considered in determining whether the
46-day holding requirement is met. Moreover, the allowable percentage
of the deduction will be reduced from 70% if a corporate Unit
holder owns certain stock (or Units) the financing of which is
directly attributable to indebtedness incurred by such corporation.
It should be noted that various legislative proposals that would
affect the dividends received deduction have been introduced.
Unit holders should consult with their tax advisers with respect
to the limitations on and possible modifications to the dividends
received deduction.
Recognition of Taxable Gain or Loss Upon Disposition of Securities
by a Trust or Disposition of Units. As discussed above, a Unit
holder may recognize taxable gain (or loss) when a Security is
disposed of by a Trust or if the Unit holder disposes of a Unit.
For taxpayers other than corporations, net capital gains are subject
to a maximum marginal tax rate of 28%. However, it should be noted
that legislative proposals are introduced from time to time that
affect tax rates and could affect relative differences at which
ordinary income and capital gains are taxed.
Page 11
The Revenue Reconciliation Act of 1993 (the "Tax Act") raised
tax rates on ordinary income while capital gains remain subject
to a 28% maximum stated rate for taxpayers other than corporations.
Because some or all capital gains are taxed at a comparatively
lower rate under the Tax Act, the Tax Act includes a provision
that recharacterizes capital gains as ordinary income in the case
of certain financial transactions that are "conversion transactions"
effective for transactions entered into after April 30, 1993.
Unit holders and prospective investors should consult with their
tax advisers regarding the potential effect of this provision
on their investment in Units.
Special Tax Consequences of In-Kind Distributions Upon Redemption
of Units (for the Growth Trust) or Termination of a Trust. As
discussed in "Rights of Unit Holders-How are Income and Capital
Distributed?", under certain circumstances a Unit holder who owns
at least 2,500 Units of a Trust may request an In-Kind Distribution
upon the redemption of Units or the termination of the Growth
Trust and only upon the termination of the Growth & Treasury Trust.
The Unit holder requesting an In-Kind Distribution will be liable
for expenses related thereto (the "Distribution Expenses") and
the amount of such In-Kind Distribution will be reduced by the
amount of the Distribution Expenses. See "Rights of Unit Holders-How
are Income and Capital Distributed?" Treasury Obligations held
by the Growth & Treasury Trust will not be distributed to a Unit
holder as part of an In-Kind Distribution. The tax consequences
relating to the sale of Treasury Obligations are discussed above.
As previously discussed, prior to the redemption of Units or the
termination of a Trust, a Unit holder is considered as owning
a pro rata portion of each of the Trust assets for Federal income
tax purposes. The receipt of an In-Kind Distribution upon the
redemption of Units (for the Growth Trust) or the termination
of a Trust would be deemed an exchange of such Unit holder's pro
rata portion of each of the shares of stock and other assets held
by such Trust in exchange for an undivided interest in whole shares
of stock plus, possibly, cash.
There are generally three different potential tax consequences
which may occur under an In-Kind Distribution with respect to
each Security owned by a Trust. A "Security" for this purpose
is a particular class of stock issued by a particular corporation
(and does not include the Treasury Obligations in the Growth &
Treasury Trust). If the Unit holder receives only whole shares
of a Security in exchange for his or her pro rata portion in each
share of such Security held by a Trust, there is no taxable gain
or loss recognized upon such deemed exchange pursuant to Section
1036 of the Code. If the Unit holder receives whole shares of
a particular Security plus cash in lieu of a fractional share
of such Security, and if the fair market value of the Unit holder's
pro rata portion of the shares of such Security exceeds his tax
basis in his pro rata portion of such Security, taxable gain would
be recognized in an amount not to exceed the amount of such cash
received, pursuant to Section 1031(b) of the Code. No taxable
loss would be recognized upon such an exchange pursuant to Section
1031(c) of the Code, whether or not cash is received in lieu of
a fractional share. Under either of these circumstances, special
rules will be applied under Section 1031(d) of the Code to determine
the Unit holder's tax basis in the shares of such particular Security
which he receives as part of the In-Kind Distribution. Finally,
if a Unit holder's pro rata interest in a Security does not equal
a whole share, he may receive entirely cash in exchange for his
pro rata portion of a particular Security. In such case, taxable
gain or loss is measured by comparing the amount of cash received
by the Unit holder with his tax basis in such Security.
Because each Trust will own many Securities, a Unit holder who
requests an In-Kind Distribution will have to analyze the tax
consequences with respect to each Security owned by a Trust. In
analyzing the tax consequences with respect to each Security,
such Unit holder must allocate the Distribution Expenses among
the Securities (the "Allocable Expenses"). The Allocable Expenses
will reduce the amount realized with respect to each Security
so that the fair market value of the shares of such Security received
(if any) and cash received in lieu thereof (as a result of any
fractional shares) by such Unit holder should equal the amount
realized for purposes of determining the applicable tax consequences
in connection with an In-Kind Distribution. A Unit holder's tax
basis in shares of such Security received will be increased by
the Allocable Expenses relating to such Security. The amount of
taxable gain (or loss) recognized upon such exchange will generally
equal the sum of the gain (or loss) recognized under the rules
described above by such Unit holder with respect to each Security
owned by a Trust. Unit holders who request an In-Kind Distribution
are advised to consult their tax advisers in this regard.
Page 12
General. Each Unit holder will be requested to provide the Unit
holder's taxpayer identification number to the Trustee and to
certify that the Unit holder has not been notified that payments
to the Unit holder 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
Unit holder (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
(accrual of original issue discount on the Treasury Obligations
in the Growth & Treasury Trust may not be subject to taxation
or withholding provided certain requirements are met). Such persons
should consult their tax advisers.
Unit holders will be notified annually of the amounts of original
issue discount (in the case of the Growth & Treasury Trust) and
income dividends includable in the Unit holder's gross income
and amounts of Trust expenses which may be claimed as itemized
deductions.
Dividend income, long-term capital gains and accrual of original
issue discount (in the case of the Growth & Treasury Trust) may
also be subject to state and local taxes. Investors should consult
their tax advisers for specific information on the tax consequences
of particular types of distributions.
Unit holders desiring to purchase Units for tax-deferred plans
and IRAs should consult their broker for details on establishing
such accounts. Units may also be purchased by persons who already
have self-directed plans established. See "Why are Investments
in the Trusts Suitable for Retirement Plans?"
In the opinion of Carter, Ledyard & Milburn, Special Counsel to
the Trusts for New York tax matters, under the existing income
tax laws of the State of New York, each Trust is not an association
taxable as a corporation and the income of each Trust will be
treated as the income of the Unit holders thereof.
Why are Investments in the Trusts Suitable for Retirement Plans?
Units of a Trust may be well suited for purchase by Individual
Retirement Accounts, Keogh Plans, pension funds and other tax-deferred
retirement plans. Generally, the Federal income tax relating to
capital gains and income received in each of the foregoing plans
is deferred until distributions are received. Distributions from
such plans are generally treated as ordinary income but may, in
some cases, be eligible for special 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.
Fees and charges with respect to such plans may vary.
PORTFOLIO
What are Treasury Obligations?
The Treasury Obligations deposited in the Growth & Treasury Trust
consist of U.S. Treasury bonds which have been stripped of their
unmatured interest coupons. The Treasury Obligations evidence
the right to receive a fixed payment at a future date from the
U.S. Government, and are backed by the full faith and credit of
the U.S. Government. Treasury Obligations are purchased at a deep
discount because the buyer obtains only the right to a fixed payment
at a fixed date in the future and does not receive any periodic
interest payments. The effect of owning deep discount bonds which
do not make current interest payments (such as the Treasury Obligations)
is that a fixed yield is earned not only on the original investment,
but also, in effect, on all earnings during the life of the discount
obligation. This implicit reinvestment of earnings at the same
rate eliminates the risk of being unable to reinvest the income
on such obligations at a rate as high as the implicit yield on
the discount obligation, but at the same time eliminates the holder's
ability to reinvest at higher rates in the future. For this reason,
the Treasury Obligations are subject to substantially greater
price fluctuations during periods of changing interest rates than
are securities of comparable quality which make regular interest
payments. The effect of being able to acquire the Treasury Obligations
at a lower price is to permit more of the Growth & Treasury Trust's
portfolio to be invested in Equity Securities.
What are Equity Securities?
The Trusts include different issues of Equity Securities, all
of which are issued by companies in the telephone industry and
are listed on a national securities exchange or the NASDAQ National
Market System or are
Page 13
traded in the over-the-counter market. Each of the companies whose
Equity Securities are included in the portfolios are actively
traded, well established corporations.
The Equity Securities were chosen by the Sponsor for inclusion
in the Trusts based on their growth potential and diversification
within the telephone industry. In selecting the Equity Securities
of both domestic and international companies which are leaders
within the communications marketplace, the Sponsor applied database
screening techniques, fundamental analysis and other analysis
and judgement.
The telephone industry is one of today's most innovative market
sectors and has become an important part of multimedia communications
worldwide. This industry facilitates the exchange of ideas, messages,
or information in a variety of formats which include speech, images,
writing and signals. Companies within this field provide consumers
with telephone equipment and services, as well as ongoing research
and development to create more efficient communication processes.
Some examples of telecommunications services are: worldwide telephone
systems, wireless services and equipment (cellular telephones,
pagers), data and voice transmission, computers, electronic equipment,
video systems, television and radio transmission.
Research in areas such as fiber optics and digital compression
may lead to further investment opportunities in the likely creation
and deployment of interactive services. Further, the industry
is diversified into many different sectors, with companies focused
on established technologies, and those engaged in development
or emerging technologies.
Evolving technology, corporate and regulatory events are redefining
and broadening the telephone industry, as well as stimulating
new services while unit costs are declining. The telephone industry
has had a major role in the development of the information age
and may provide new opportunities for earnings and dividend growth,
although the industry is subject to fierce competition. The Sponsor
believes that the communications industry is positioned for rapid
growth. Even without this projected growth, the telephone industry
should continue to serve customers using telephone services in
both personal and business transactions in existing and expanding
markets. There is no assurance that the objectives of the Trusts
will be achieved or that growth in the telephone industry will
translate into higher prices of the Equity Securities.
Risk Factors. The Trusts consist of such of the Equity Securities
listed under "Schedule of Investments" for each Trust as may continue
to be held from time to time in the Trusts and any additional
Equity Securities acquired and held by the Trusts pursuant to
the provisions of the Trust Agreement together with cash held
in the Income and Capital Accounts. Neither the Sponsor nor the
Trustee shall be liable in any way for any failure in any of the
Equity Securities. However, should any contract for the purchase
of any of the Equity Securities initially deposited hereunder
fail, the Sponsor will, unless substantially all of the moneys
held in the Trust to cover such purchase are reinvested in substitute
Equity Securities in accordance with the Trust Agreement, refund
the cash and sales charge attributable to such failed contract
to all Unit holders on the next distribution date.
Each Trust concentrates its equity securities in the telephone
industry and, as a result, the value of the Units of a Trust may
be susceptible to factors affecting the telephone industry. The
telephone industry is subject to governmental regulation and the
products and services of telecommunications companies may be subject
to rapid obsolescence. These factors could affect the value of
a Trust's Units. Telephone companies in the United States, for
example, are subject to both state and federal regulations affecting
permitted rates of returns and the kinds of services that may
be offered. Certain types of companies represented in the Trust's
portfolio are engaged in fierce competition for a share of the
market of their products. As a result, competitive pressures are
intense and the stocks are subject to rapid price volatility.
While the Trust's portfolio concentrates on the securities of
established suppliers of traditional telecommunication products
and services, the Trusts also invest in smaller telephone companies
which may benefit from the development of new products and services.
These smaller companies may present greater opportunities for
capital appreciation, and may also involve greater risk than large,
established issuers. Such smaller companies may have limited product
lines, market or financial resources, and their securities may
trade less frequently and in limited volume than the securities
of larger, more established companies. As a result, the prices
of the securities of such smaller companies may fluctuate to a
greater degree than the prices of securities of other issuers.
Page 14
Since certain of the Equity Securities in the Trusts consist of
securities of foreign issuers, an investment in the Trusts involves
some investment risks that are different in some respects from
an investment in a trust that invests entirely in securities of
domestic issuers. Those investment risks include future political
and governmental restrictions which might adversely affect the
payment or receipt of payment of dividends on the relevant Equity
Securities, currency exchange rate fluctuations, exchange control
policies, and the limited liquidity and small market capitalization
of such foreign countries' securities markets. In addition, for
the foreign issuers that are not subject to the reporting requirements
of the Securities Exchange Act of 1934, there may be less publicly
available information than is available from a domestic issuer.
Also, foreign issuers are not necessarily subject to uniform accounting,
auditing and financial reporting standards, practices and requirements
comparable to those applicable to domestic issuers. However, due
to the nature of the issuers of Equity Securities included in
the Trusts, the Sponsor believes that adequate information will
be available to allow the Portfolio Supervisor to provide portfolio
surveillance.
The securities of certain of the foreign issuers in the Trusts
are in ADR form. ADRs evidence American Depositary Receipts which
represent common stock deposited with a custodian in a depositary.
American Depositary Shares, and receipts therefor (ADRs), are
issued by an American bank or trust company to evidence ownership
of underlying securities issued by a foreign corporation. These
instruments may not necessarily be denominated in the same currency
as the securities into which they may be converted. For purposes
of the discussion herein, the term ADR generally includes American
Depositary Shares.
ADRs may be sponsored or unsponsored. In an unsponsored facility,
the depositary initiates and arranges the facility at the request
of market makers and acts as agent for the ADR holder, while the
company itself is not involved in the transaction. In a sponsored
facility, the issuing company initiates the facility and agrees
to pay certain administrative and shareholder-related expenses.
Sponsored facilities use a single depositary and entail a contractual
relationship between the issuer, the shareholder and the depositary;
unsponsored facilities involve several depositaries with no contractual
relationship to the company. The depositary bank that issues an
ADR generally charges a fee, based on the price of the ADR, upon
issuance and cancellation of the ADR. This fee would be in addition
to the brokerage commissions paid upon the acquisition or surrender
of the security. In addition, the depositary bank incurs expenses
in connection with the conversion of dividends or other cash distributions
paid in local currency into U.S. dollars and such expenses are
deducted from the amount of the dividend or distribution paid
to holders, resulting in a lower payout per underlying shares
represented by the ADR than would be the case if the underlying
share were held directly. Certain tax considerations, including
tax rate differentials and withholding requirements, arising from
applications of the tax laws of one nation to nationals of another
and from certain practices in the ADR market may also exist with
respect to certain ADRs. In varying degrees, any or all of these
factors may affect the value of the ADR compared with the value
of the underlying shares in the local market. In addition, the
rights of holders of ADRs may be different than those of holders
of the underlying shares, and the market for ADRs may be less
liquid than that for the underlying shares. ADRs are registered
securities pursuant to the Securities Act of 1933 and may be subject
to the reporting requirements of the Securities Exchange Act of
1934.
For those Equity Securities that are ADRs, currency fluctuations
will affect the U.S. dollar equivalent of the local currency price
of the underlying domestic share and, as a result, are likely
to affect the value of the ADRs and consequently the value of
the Equity Securities. The foreign issuers of securities that
are ADRs may pay dividends in foreign currencies which must be
converted into dollars. Most foreign currencies have fluctuated
widely in value against the United States dollar for many reasons,
including supply and demand of the respective currency, the soundness
of the world economy and the strength of the respective economy
as compared to the economies of the United States and other countries.
Therefore, for any securities of issuers (whether or not they
are in ADR form) whose earnings are stated in foreign currencies,
or which pay dividends in foreign currencies or which are traded
in foreign currencies, there is a risk that their United States
dollar value will vary with fluctuations in the United States
dollar foreign exchange rates for the relevant currencies.
On the basis of the best information available to the Sponsor
at the present time, none of the Equity Securities are subject
to exchange control restrictions under existing law which would
materially interfere with
Page 15
payment to the Trusts of dividends due on, or proceeds from the
sale of, the Equity Securities. However, there can be no assurance
that exchange control regulations might not be adopted in the
future which might adversely affect payment to the Trusts. In
addition, the adoption of exchange control regulations and other
legal restrictions could have an adverse impact on the marketability
of international securities in the Trusts and on the ability of
the Trusts to satisfy its obligation to redeem Units tendered
to the Trustee for redemption.
Because certain of the Equity Securities from time to time may
be sold under certain circumstances described herein, and because
the proceeds from such events will be distributed to Unit holders
and will not be reinvested, no assurance can be given that a Trust
will retain for any length of time its present size and composition.
Although the Portfolios are not managed, the Sponsor may instruct
the Trustee to sell Equity Securities under certain limited circumstances.
Pursuant to the Indenture and with limited exceptions, the Trustee
may sell any securities or other property acquired in exchange
for Equity Securities such as those acquired in connection with
a merger or other transaction. If offered such new or exchanged
securities or property, the Trustee shall reject the offer. However,
in the event such securities or property are nonetheless acquired
by a Trust, they may be accepted for deposit in such Trust and
either sold by the Trustee or held in the Trust pursuant to the
direction of the Sponsor (who may rely on the advice of the Portfolio
Supervisor). See "How May Securities be Removed from the Trusts?"
Equity Securities, however, will not be sold by a Trust to take
advantage of market fluctuations or changes in anticipated rates
of appreciation or depreciation.
An investment in Units should be made with an understanding of
the risks which an investment in common stocks entails, including
the risk that the financial condition of the issuers of the Equity
Securities or the general condition of the common stock market
may worsen and the value of the Equity Securities and therefore
the value of the Units may decline. Common stocks are especially
susceptible to general stock market movements and to volatile
increases and decreases of value as market confidence in and perceptions
of the issuers change. These perceptions are based on unpredictable
factors including expectations regarding government, economic,
monetary and fiscal policies, inflation and interest rates, economic
expansion or contraction, and global or regional political, economic
or banking crises. Shareholders of common stocks have rights to
receive payments from the issuers of those common stocks that
are generally subordinate to those of creditors of, or holders
of debt obligations or preferred stocks of, such issuers. Shareholders
of common stocks of the type held by the Trusts have a right to
receive dividends only when and if, and in the amounts, declared
by the issuer's board of directors and have a right to participate
in amounts available for distribution by the issuer only after
all other claims on the issuer have been paid or provided for.
Common stocks do not represent an obligation of the issuer and,
therefore, do not offer any assurance of income or provide the
same degree of protection of capital as do debt securities. The
issuance of additional debt securities or preferred stock will
create prior claims for payment of principal, interest and dividends
which could adversely affect the ability and inclination of the
issuer to declare or pay dividends on its common stock or the
rights of holders of common stock with respect to assets of the
issuer upon liquidation or bankruptcy. The value of common stocks
is subject to market fluctuations for as long as the common stocks
remain outstanding, and thus the value of the Equity Securities
in each Portfolio may be expected to fluctuate over the life of
the Trusts to values higher or lower than those prevailing on
the Initial Date of Deposit.
Holders of common stocks incur more risk than holders of preferred
stocks and debt obligations because common stockholders, as owners
of the entity, have generally inferior rights to receive payments
from the issuer in comparison with the rights of creditors of,
or holders of debt obligations or preferred stocks issued by,
the issuer. Cumulative preferred stock dividends must be paid
before common stock dividends and any cumulative preferred stock
dividend omitted is added to future dividends payable to the holders
of cumulative preferred stock. Preferred stockholders are also
generally entitled to rights on liquidation which are senior to
those of common stockholders.
Whether or not the Equity Securities are listed on a national
securities exchange, the principal trading market for the Equity
Securities may be in the over-the-counter market. As a result,
the existence of a liquid trading market for the Equity Securities
may depend on whether dealers will make a market in the Equity
Securities. There can be no assurance that a market will be made
for any of the Equity Securities, that any
Page 16
market for the Equity Securities will be maintained or of the
liquidity of the Equity Securities in any markets made. In addition,
a Trust may be restricted under the Investment Company Act of
1940 from selling Equity Securities to the Sponsor. The price
at which the Equity Securities may be sold to meet redemptions,
and the value of a Trust, will be adversely affected if trading
markets for the Equity Securities are limited or absent.
Unit holders will be unable to dispose of any of the Equity Securities
in a Portfolio, as such, and will not be able to vote the Equity
Securities. As the holder of the Equity Securities, the Trustee
will have the right to vote all of the voting stocks in each Trust
and will vote such stocks in accordance with the instructions
of the Sponsor.
What are the Equity Securities Selected for Telephone Growth Trust,
Series 3 and Telephone Growth & Treasury Securities Trust, Series 4?
AirTouch Communications, Inc. is headquartered in Walnut Creek,
California and provides wireless telecommunication services to
customers worldwide. The company operates cellular phone systems,
mobile telephone service, owns an interest in a long-distance
telephone company in Japan, paging systems, a majority interest
in a vehicle location service and a credit card verification service.
ALLTEL Corporation, headquartered in Little Rock, Arkansas, is
a telecommunications holding company which, through its subsidiaries,
provides telephone service to customers located primarily in the
midwestern, eastern and southern United States. The company also
provides cellular telecommunication, wide area paging and fiber
optic-based long distance telephone services, equipment supply,
information services and other related services.
Ameritech Corporation, is a holding company for Illinois Bell,
Indiana Bell, Michigan Bell, Ohio Bell and Wisconsin Bell providing
communications services directly to those states. Ameritech, which
is headquartered in Chicago, Illinois, became the first regional
holding company to offer cellular mobile telephone services.
AT&T Corporation, headquartered in New York, New York, provides
products, services and systems for the movement and management
of information. The company also provides voice, data and image
telecommunications services, including domestic and international
long distance telecommunications services. In addition, the company
also markets AT&T products, systems and services in the United
States and abroad.
Bell Atlantic Corporation, located in Philadelphia, Pennsylvania,
owns and operates various telephone subsidiaries in the Middle
Atlantic states and the District of Columbia. In addition, the
company operates cellular telephone services in its geographic
service area, maintains computer equipment and associated peripherals
and sells and repairs computer parts. The company also provides
telephone consulting outside the United States.
BellSouth Corporation, headquartered in Atlanta, Georgia, is the
largest telephone holding company resulting from the AT&T breakup.
Through its subsidiaries, the company provides services in tele-
communications, information distribution, mobile communications
and other related fields.
Cable & Wireless PLC (ADR), along with its subsidiaries, provides
telecommunications services, including telephone services in the
United Kingdom and internationally. The company sells, rents and
maintains telecommunication equipment in its areas of operations.
Cable & Wireless, headquartered in London, England, provides its
services in the United Kingdom through an all digital telecomm-
unications network using fiber optics and microwave links.
Century Telephone Enterprises, Inc. is an independent telecommunications
company serving customers in the south and midwest. Headquartered
in Monroe, Louisiana, the company's other operations include radio
paging, cellular telephone technology and voice messaging.
Compania de Telefonos de Chile S.A. (ADR), headquartered in Santiago,
Chile, is a telecommunications company that operates telephone
lines throughout Chile. The company provides local and domestic
long distance telephone services. A cellular telephone network
is also operated throughout the metropolitan areas of Santiago
and Valparaiso.
Page 17
C-Tec Corporation, headquartered in Wilkes-Barre, Pennsylvania,
offers its telephone services in eastern Pennsylvania and cable
television services in New Jersey, Pennsylvania, New York and
Michigan. C-Tec Corporation provides telephone, cable television,
mobile information and communication services. The company also
provides cellular telephone services, network engineering and
integration throughout the United States.
GTE Corporation, headquartered in Stamford, Connecticut, owns
the largest non-Bell telecommunications system in the United States.
The company operates telephone companies and manufactures and
sells lighting and telecommunication products. GTE Corporation
serves access lines in numerous states, British Columbia and the
Dominican Republic.
LCI International, Inc. is a long distance telecommunications
carrier providing a variety of domestic and international voice
and data services to commercial and residential customers. The
company is headquartered in McLean, Virginia.
LDDS Communications, Inc., based in Jackson, Mississippi, provides
a variety of long-distance telephone services to residential and
commercial customers in the southeast, southwest and the midwest.
The company offers "one plus" dialing, outbound WATS, inbound
and travel "800" services.
Lincoln Telecommunications Company, based in Lincoln, Nebraska,
is a holding company for Lincoln Telephone and Telegraph Company,
which provides service to numerous counties in southeastern Nebraska.
The company also furnishes cellular telephone service, answering,
leasing and interexchange services.
MCI Communications Corporation provides a wide spectrum of domestic
and international voice and data communications services to individuals,
businesses and government agencies. Based in Washington, D.C.,
the company offers long-distance services throughout the United
States as well as internationally. In addition, MCI Communications
Corporation offers domestic and international time-sensitive electronic
mailing, 800 Service, 900 Service, operator assistance and fax
services.
MFS Communications Company, Inc., headquartered in Omaha, Nebraska,
provides local competitive access telecommunications services
in the United States. Services include a wide range of high quality
voice, data and other enhanced systems.
Mobile Telecommunications Technologies Corporation is a diversified
communications company providing nationwide paging services, telephone
answering services and air-to-ground and marine telecommunications.
The company is headquartered in Jackson, Mississippi.
Pacific Telesis Group, comprised of Pacific Bell, Pacific Bell
Directory and Nevada Bell, provides a wide variety of communications
services in California and Nevada, including local exchange and
toll service, network access and directory advertising. The company
is one of seven regional holding companies formed in connection
with the divestiture by AT&T Corporation. The company is headquartered
in San Francisco, California.
Philippine Long Distance Telecom Company (ADR) provides telephone
services to the Philippines from its headquarters in Manila. The
company has a network of central offices that serve Metro Manila
and other cities and municipalities throughout the country and
is the Philippines' principal supplier of long distance service.
Rogers Cantel Mobile Communications (Class B), headquartered in
North York, Ontario, Canada, operates a cellular telephone network
in Canada. The company is the only telecommunications company
authorized to provide the service nationwide. The company has
a paging service that serves approximately 39,000 subscribers.
SBC Communications, Inc., based in St. Louis, Missouri, is one
of the regional companies formerly owned by AT&T Corporation.
The company is a telephone holding company which provides exchange
telecommunications and access services. In addition, SBC Communications,
Inc. markets cellular telephone services, provides paging services
and directory publishing.
Southern New England Telecommunications Corporation is a holding
company for Southern New England Telephone Company which provides
telephone services in Connecticut. Located in New Haven, Connecticut,
the company also sells and leases communication equipment, provides
cellular mobile telephone service and develops and leases real
estate.
Page 18
Sprint Corporation, headquartered in Kansas City, Missouri, through
its wholly-owned and majority-held subsidiaries, including Sprint
Communications Company L.P., provides domestic voice and data
communications services across specified geographic boundaries,
as well as international communications services.
Telecom Corporation of New Zealand, Ltd. (ADR), is a supplier
of telecommunications services in New Zealand. The company, based
in Wellington, New Zealand, provides local, national and international
telephone services and a wide range of other telecommunications
services, including cellular, directories, leased circuits, mobile
radio, paging and data communications.
Telefonica de Espana (ADR), supplies telephone services in Spain.
In addition to domestic and international telephone services,
the company provides mobile telephone services and supplies data
transmission services, transmission of news and other information
to subscribers, videotex terminals, coded alarm systems and electronic
mail.
Telefonos de Mexico S.A. (ADR) (Class L), headquartered in Mexico
City, Mexico, provides national and international long-distance
and local telephone service to communities throughout Mexico.
A group consisting of Grupo Carso (a Mexican industrial group),
Southwestern Bell and France Telecom, Inc. owns a majority of
the company's voting rights. The company also provides directory
assistance and cellular mobile telephone services.
Telephone and Data Systems, Inc., through its operating subsidiaries,
provides local telephone service to rural and suburban areas throughout
most of the United States. The company, also through subsidiaries,
offers radio paging services in metropolitan markets and is developing
cellular telephone operations. The company is based in Chicago,
Illinois.
Vodafone Group PLC (ADR), provides mobile telecommunication services
in the United Kingdom. The company's subsidiaries provide message,
third-party charging, data transmission facilities and operate
a radiopaging network. In addition, Vodafone Group PLC also holds
interests in international cellular network operators.
What are Some Additional Considerations for Investors?
Investors should be aware of certain other considerations before
making a decision to invest in the Trusts.
The value of the Equity Securities, like the value of the Treasury
Obligations, will fluctuate over the life of a Trust and may be
more or less than the price at which they were deposited in such
Trust. The Equity Securities may appreciate or depreciate in value
(or pay dividends) depending on the full range of economic and
market influences affecting these securities. However, the Sponsor
believes that, upon termination of the Growth & Treasury Trust,
even if the Equity Securities deposited in the Growth & Treasury
Trust are worthless, an event which the Sponsor considers highly
unlikely, the Treasury Obligations will provide sufficient principal
to at least equal $10.00 per Unit (which is equal to the per Unit
value upon maturity of the Treasury Obligations). This feature
of the Growth & Treasury Trust provides Unit holders with principal
protection, although they might forego any earnings on the amount
invested. To the extent that Units are purchased at a price less
than $10.00 per Unit, this feature may also provide a potential
for capital appreciation.
Unless a Unit holder purchases Units of the Growth & Treasury
Trust on the Initial Date of Deposit (or another date when the
value of the Units is $10.00 or less), total distributions, including
distributions made upon termination of the Growth & Treasury Trust,
may be less than the amount paid for a Unit.
The Sponsor and the Trustee shall not be liable in any way for
any default, failure or defect in any Security. In the event of
a notice that any Treasury Obligations or Equity Securities will
not be delivered ("Failed Contract Obligations") to a Trust, the
Sponsor is authorized under the Indenture to direct the Trustee
to acquire other Treasury Obligations (in the case of the Growth
& Treasury Trust) or Equity Securities ("Replacement Securities").
Any Replacement Security deposited in a Trust will, in the case
of Treasury Obligations in the Growth & Treasury Trust, have the
same maturity value and, as closely as can be reasonably acquired
by the Sponsor, the same maturity date or, in the case of Equity
Securities, be identical to those which were the subject of the
failed contract. The Replacement Securities must be purchased
within 20
Page 19
days after delivery of the notice of a failed contract and the
purchase price may not exceed the amount of funds reserved for
the purchase of the Failed Contract Obligations.
If the right of limited substitution described in the preceding
paragraphs is not utilized to acquire Replacement Securities in
the event of a failed contract, the Sponsor will refund the sales
charge attributable to such Failed Contract Obligations to all
Unit holders of the affected Trust and the Trustee will distribute
the principal attributable to such Failed Contract Obligations
not more than 120 days after the date on which the Trustee received
a notice from the Sponsor that a Replacement Security would not
be deposited in the Trust. In addition, Unit holders should be
aware that, at the time of receipt of such principal, they may
not be able to reinvest such proceeds in other securities at a
yield equal to or in excess of the yield which such proceeds would
have earned for Unit holders of such Trust.
The Indenture also authorizes the Sponsor to increase the size
of the Trusts and the number of Units thereof by the deposit of
additional Securities in each Trust and the issuance of a corresponding
number of additional Units.
Each Trust consists of the Securities listed under "Schedule of
Investments" (or contracts to purchase such Securities) as may
continue to be held from time to time in such Trusts and any additional
Securities acquired and held by each Trust pursuant to the provisions
of the Indenture (including provisions with respect to deposits
into each Trust of Securities in connection with the issuance
of additional Units).
Once all of the Securities in each Trust are acquired, the Trustee
will have no power to vary the investments of the Trust, i.e.,
the Trustee will have no managerial power to take advantage of
market variations to improve a Unit holder's investment, but may
dispose of Securities only under limited circumstances. See "How
May Securities be Removed from the Trusts?"
To the best of the Sponsor's knowledge, there is no litigation
pending as of the Initial Date of Deposit in respect of any Security
which might reasonably be expected to have a material adverse
effect on the Trusts. At any time after the Initial Date of Deposit,
litigation may be instituted on a variety of grounds with respect
to the Securities. The Sponsor is unable to predict whether any
such litigation will be instituted, or if instituted, whether
such litigation might have a material adverse effect on the Trusts.
PUBLIC OFFERING
How is the Public Offering Price Determined?
Units are offered at the Public Offering Price. During the initial
offering period, with respect to the Growth Trust, the Public
Offering Price is based on the aggregate underlying value of the
Equity Securities in the Trust, plus or minus cash, if any, in
the Income and Capital Accounts of the Trust, plus a sales charge
of 4.9% (equivalent to 5.152% of the net amount invested) divided
by the number of Units of the Trust outstanding.
During the initial offering period, with respect to the Growth
& Treasury Trust, the Public Offering Price is based on the aggregate
of the offering side evaluation of the Treasury Obligations in
each Trust and the aggregate underlying value of the Equity Securities
in the Trust, plus or minus cash, if any, in the Income and Capital
Accounts of the Trust, plus a sales charge of 5.5% (equivalent
to 5.820% of the net amount invested) divided by the number of
Units of the Trust outstanding.
During the initial offering period, with respect to the Growth
Trust, the Sponsor's Repurchase Price is based on the aggregate
underlying value of the Equity Securities in the Trust, plus or
minus cash, if any, in the Income and Capital Accounts of the
Trust divided by the number of Units of the Trust outstanding.
For secondary market sales after the completion of the initial
offering period, the Public Offering Price is also based on the
aggregate underlying value of the Equity Securities in the Trust,
plus or minus cash, if any, in the Income and Capital Accounts
of the Trust, plus a maximum sales charge of 4.9% of the Public
Offering Price (equivalent to 5.152% of the net amount invested),
subject to reduction beginning January 1, 1996, divided by the
number of outstanding Units of the Trust.
During the initial offering period, with respect to the Growth
& Treasury Trust, the Sponsor's Repurchase Price is based on the
aggregate of the offering side evaluation of the Treasury Obligations
in the Trust and the aggregate underlying value of the Equity
Securities in the Trust, plus or minus cash, if any, in the Income
and Capital Accounts of the Trust divided by the number of Units
of the Trust outstanding. For secondary market sales after the
completion of the initial offering period, the Public Offering
Price is based on the aggregate
Page 20
bid side evaluation of the Treasury Obligations in the Trust and
the aggregate underlying value of the Equity Securities in each
Trust, plus or minus cash, if any, in the Income and Capital Accounts
of the Trust, plus a maximum sales charge of 5.5% of the Public
Offering Price (equivalent to 5.820% of the net amount invested),
subject to reduction beginning January 1, 1996, divided by the
number of outstanding Units of such Trust.
The minimum purchase of the Growth Trust is $1,000. The applicable
sales charge is reduced by a discount as indicated below for volume
purchases with respect to the Growth Trust:
<TABLE>
<CAPTION>
Primary and Secondary
_____________________
Percent of Percent of
Offering Net Amount
Number of Units Price Invested
_______________ __________ __________
<S> <C> <C>
5,000 but less than 10,000 0.25% 0.2506%
10,000 but less than 25,000 0.50% 0.5025%
25,000 but less than 50,000 1.00% 1.0101%
50,000 or more 2.00% 2.0408%
</TABLE>
The minimum purchase of the Growth & Treasury Trust is $1,000.
The applicable sales charge is reduced by a discount as indicated
below for volume purchases with respect to the Growth & Treasury
Trust:
<TABLE>
<CAPTION>
Primary and Secondary
_____________________
Percent of Percent of
Offering Net Amount
Number of Units Price Invested
_______________ __________ __________
<S> <C> <C>
10,000 but less than 50,000 0.60% 0.6036%
50,000 but less than 100,000 1.30% 1.3171%
100,000 or more 2.10% 2.1450%
</TABLE>
Any such reduced sales charge shall be the responsibility of the
selling dealer. The reduced sales charge structure will apply
on all purchases of Units in the Trust 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 the
purposes of calculating the applicable sales charge, to be additional
purchases by the purchaser. The reduced sales charges will also
be applicable to a trustee or other fiduciary purchasing securities
for a single trust estate or single fiduciary account. The purchaser
must inform the dealer of any such combined purchase prior to
the sale in order to obtain the indicated discount. In addition,
with respect to the employees, officers and directors (including
their immediate family members, defined as spouses, children,
grandchildren, parents, grandparents, mothers-in-law, fathers-in-law,
sons-in-law and daughters-in-law, and trustees, custodians or
fiduciaries for the benefit of such persons) of the Sponsor, dealers
and their subsidiaries, the sales charge is reduced by 2.0% of
the Public Offering Price for purchases of Units during the primary
and secondary public offering periods.
Had the Units of the Trusts been available for sale on the business
day prior to the Initial Date of Deposit, the Public Offering
Price for each Trust would have been as indicated in "Summary
of Essential Information." The Public Offering Price of Units
on the date of the prospectus or during the initial offering period
may vary from the amount stated under "Summary of Essential Information"
in accordance with fluctuations in the prices of the underlying
Securities. During the initial offering period, the aggregate
value of the Units of each Trust shall be determined (a) on the
basis of the offering prices of the Treasury Obligations (if any)
and the aggregate underlying value of the Equity Securities therein
plus or minus cash, if any, in the Income and Capital Accounts
of such Trust, (b) if offering prices are not available for the
Treasury Obligations (if any), on the basis of offering prices
for comparable securities, (c) by determining the value of the
Treasury Obligations (if any) on the offer side of the market
by appraisal, or (d) by any combination of the above. The aggregate
underlying value of the Equity Securities will be determined in
the following manner: if the Equity Securities
Page 21
are listed on a national securities exchange or the NASDAQ National
Market System, this evaluation is generally based on the closing
sale prices on that exchange or that system (unless it is determined
that these prices are inappropriate as a basis for valuation)
or, if there is no closing sale price on that exchange or system,
at the closing ask prices. If the Equity Securities are not so
listed or, if so listed and the principal market therefor is other
than on the exchange, the evaluation shall generally be based
on the current ask price on the over-the-counter market (unless
it is determined that these prices are inappropriate as a basis
for evaluation). If current ask prices are unavailable, the evaluation
is generally determined (a) on the basis of current ask prices
for comparable securities, (b) by appraising the value of the
Equity Securities on the ask side of the market or (c) by any
combination of the above.
After the completion of the initial offering period, the secondary
market Public Offering Price will be equal to the bid price per
Unit of the Treasury Obligations in each Trust (if any) and the
aggregate underlying value of the Equity Securities therein, plus
or minus cash, if any, in the Income and Capital Accounts of each
Trust plus the applicable sales charge. The offering price of
the Treasury Obligations in the Growth & Treasury Trust may be
expected to be greater than the bid price of the Treasury Obligations
by less than 2%.
Although payment is normally made five business days following
the order for purchase, payment may be made prior thereto. A person
will become owner of Units on the date of settlement provided
payment has been received. Cash, if any, made available to the
Sponsor prior to the date of settlement for the purchase of Units
may be used in the Sponsor's business and may be deemed to be
a benefit to the Sponsor, subject to the limitations of the Securities
Exchange Act of 1934. Delivery of Certificates representing Units
so ordered will be made five business days following such order
or shortly thereafter. See "Rights of Unit Holders-How May Units
be Redeemed?" for information regarding the ability to redeem
Units ordered for purchase.
How are Units Distributed?
During the initial offering period (i) for Units issued on the
Initial Date of Deposit and (ii) for additional Units issued after
such date as additional Securities are deposited by the Sponsor,
Units will be distributed to the public at the then current Public
Offering Price. The initial offering period may be up to approximately
360 days. During such period, the Sponsor may deposit additional
Securities in each Trust and create additional Units. Units reacquired
by the Sponsor during the initial offering period (at prices based
upon the aggregate offering price of the Treasury Obligations
(if any) and the aggregate underlying value of the Equity Securities
in each Trust plus or minus a pro rata share of cash, if any,
in the Income and Capital Accounts of such Trust) may be resold
at the then current Public Offering Price. Upon the termination
of the initial offering period, unsold Units created or reacquired
during the initial offering period will be sold or resold at the
then current Public Offering Price.
Upon completion of the initial offering, Units repurchased in
the secondary market (see "Will There be a Secondary Market?")
may be offered by this prospectus at the secondary market public
offering price determined in the manner described above.
It is the intention of the Sponsor to qualify Units of the Trusts
for sale in a number of states. With respect to the Growth Trust,
sales initially will be made to dealers and others at prices which
represent a concession or agency commission of 3.2% of the Public
Offering Price, and, for secondary market sales, 3.2% of the Public
Offering Price (or 65% of the then current maximum sales charge
after January 1, 1996). With respect to the Growth & Treasury
Trust, sales initially will be made to dealers and others at prices
which represent a concession or agency commission of 3.6% of the
Public Offering Price, and, for secondary market sales, 3.6% of
the Public Offering Price (or 65% of the then current maximum
sales charge after January 1, 1996). Volume concessions or agency
commissions of an additional 0.40% of the Public Offering Price
will be given to any broker/dealer or bank, who purchases from
the Sponsor at least $100,000 of a Trust on the Initial Date of
Deposit or $250,000 on any other day thereafter. The Sponsor reserves
the right to change the amount of the concession or agency commission
from time to time. Effective on each January 1, commencing January
1, 1996, the sales charge of the Growth Trust and the Growth &
Treasury Trust will be reduced by 1/2 of 1% to a minimum sales
charge of 3.0% and 3.5%, respectively. However, resales of Units
of the Trusts by such dealers and others to the public will be
made at the Public Offering Price described in the prospectus.
Certain commercial banks may be making Units of the Trusts available
to their customers on an agency basis. A portion
Page 22
of the sales charge paid by these customers is retained by or
remitted to the banks in the amounts indicated 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 not indicated that
these particular agency transactions are not permitted under such
Act. In Texas and in certain other states, any banks making Units
available must be registered as broker/dealers under state law.
Dealers and others who, in a single month, purchase from the Sponsor
Units of any Series of The First Trust GNMA, The First Trust of
Insured Municipal Bonds, The First Trust Combined Series, The
First Trust Special Situations Trust, or any other unit investment
trust of which Nike Securities L.P. is the Sponsor (the "UIT Units"),
which sale of UIT Units are in the following aggregate dollar
amounts, will receive additional concessions from the Sponsor
as indicated in the following table:
<TABLE>
<CAPTION>
Aggregate Monthly Amount Additional Concession
of UIT Units Sold (per $1,000 sold)
________________________ _____________________
<S> <C>
$ 1,000,000 - $2,499,999 $0.50
$ 2,500,000 - $4,999,999 $1.00
$ 5,000,000 - $7,499,999 $1.50
$ 7,500,000 - $9,999,999 $2.00
$10,000,000 or more $2.50
</TABLE>
Aggregate Monthly Dollar Amount of UIT Units Sold is based on
settled trades for a month (including sales of UIT Units to the
Sponsor in the secondary market which are resold), net of redemptions.
From time to time the Sponsor may implement programs under which
dealers of a Trust may receive nominal awards from the Sponsor
for each of their registered representatives who have sold a minimum
number of UIT Units during a specified time period. In addition,
at various times the Sponsor may implement other programs under
which the sales force of a dealer may be eligible to win other
nominal awards for certain sales efforts, or under which the Sponsor
will reallow to any such dealer that sponsors sales contests or
recognition programs conforming to criteria established by the
Sponsor, or participates in sales programs sponsored by the Sponsor,
an amount not exceeding the total applicable sales charges on
the sales generated by such person at the public offering price
during such programs. Also, the Sponsor in its discretion may
from time to time pursuant to objective criteria established by
the Sponsor pay fees to qualifying dealers for certain services
or activities which are primarily intended to result in sales
of Units of a Trust. Such payments are made by the Sponsor out
of its own assets, and not out of the assets of the Trust. These
programs will not change the price Unit holders pay for their
Units or the amount that the Trust will receive from the Units
sold.
The Sponsor may from time to time in its advertising and sales
materials compare the then current estimated returns on a Trust
and returns over specified periods on other similar Trusts sponsored
by Nike Securities L.P. with returns on other taxable investments
such as corporate or U.S. Government bonds, bank CDs and money
market accounts or money market funds, each of which has investment
characteristics that may differ from those of the Trust. U.S.
Government bonds, for example, are backed by the full faith and
credit of the U.S. Government and bank CDs and money market accounts
are insured by an agency of the federal government. Money market
accounts and money market funds provide stability of principal,
but pay interest at rates that vary with the condition of the
short-term debt market. The investment characteristics of each
Trust are described more fully elsewhere in this Prospectus.
Trust performance may be compared to performance on a total return
basis with the Dow Jones Industrial Average, the S&P 500 Composite
Price Stock Index, or performance data from Lipper Analytical
Services, Inc. and Morningstar Publications, Inc. or from publications
such as Money Magazine, The New York Times, U.S. News and World
Report, Business Week, Forbes Magazine or Fortune Magazine. As
with other performance data, performance comparisons should not
be considered representative of the Trust's relative performance
for any future period.
What are the Sponsor's Profits?
With respect to the Growth Trust, the Sponsor of the Trust will
receive a gross sales commission equal to 4.9% of the Public Offering
Price of the Units (equivalent to 5.152% of the net amount invested).
With respect to
Page 23
the Growth & Treasury Trust, the Sponsor of the Trust will receive
a gross sales commission equal to 5.5% of the Public Offering
Price of the Units (equivalent to 5.820% of the net amount invested)
as described under "Public Offering-How is the Public Offering
Price Determined?"See "Public Offering-How are Units Distributed?"
for information regarding the receipt of additional concessions
available to dealers and others. In addition, the Sponsor may
be considered to have realized a profit or to have sustained a
loss, as the case may be, in the amount of any difference between
the cost of the Securities to a Trust (which is based on the Evaluator's
determination of the aggregate offering price of the underlying
Securities of such Trust on the Initial Date of Deposit as well
as on subsequent deposits) and the cost of such Securities to
the Sponsor. See Note (2) of "Schedules of Investments." During
the initial offering period, the dealers and others also may realize
profits or sustain losses as a result of fluctuations after the
Date of Deposit in the Public Offering Price received by such
dealers and others upon the sale of Units.
In maintaining a market for the Units, the Sponsor will also realize
profits or sustain losses in the amount of any difference between
the price at which Units are purchased and the price at which
Units are resold (which price includes a sales charge of 4.9%
and 5.5% with respect to the Growth Trust and Growth & Treasury
Trust, respectively, subject to reduction beginning January 1,
1996) or redeemed. The secondary market public offering price
of Units may be greater or less than the cost of such Units to
the Sponsor.
Will There be a Secondary Market?
After the initial offering period, although it is not obligated
to do so, the Sponsor intends to maintain a market for the Units
and continuously offer to purchase Units at prices, subject to
change at any time, based upon the aggregate bid price of the
Treasury Obligations in the Portfolio of a Trust (if any) and
the aggregate underlying value of the Equity Securities in such
Trust plus or minus cash, if any, in the Income and Capital Accounts
of such Trust. All expenses incurred in maintaining a secondary
market, other than the fees of the Evaluator and the costs of
the Trustee in transferring and recording the ownership of Units,
will be borne by the Sponsor. If the supply of Units exceeds demand,
or for some other business reason, the Sponsor may discontinue
purchases of Units at such prices. IF A UNIT HOLDER WISHES TO
DISPOSE OF HIS UNITS, HE SHOULD INQUIRE OF THE SPONSOR AS TO CURRENT
MARKET PRICES PRIOR TO MAKING A TENDER FOR REDEMPTION TO THE TRUSTEE.
RIGHTS OF UNIT HOLDERS
How is Evidence of Ownership Issued and Transferred?
The Trustee is authorized to treat as the record owner of Units
that person who is registered as such owner on the books of the
Trustee. Ownership of Units may be evidenced by registered certificates
executed by the Trustee and the Sponsor. Delivery of certificates
representing Units ordered for purchase is normally made five
business days following such order or shortly thereafter. Certificates
are transferable by presentation and surrender to the Trustee
properly endorsed or accompanied by a written instrument or instruments
of transfer. Certificates to be redeemed must be properly endorsed
or accompanied by a written instrument or instruments of transfer.
A Unit holder must sign exactly as his name appears on the face
of the certificate with the signature guaranteed by a participant
in the Securities Transfer Agents Medallion Program ("STAMP")
or such other signature guarantee program in addition to, or in
substitution for, STAMP, as may be accepted by the Trustee. In
certain instances the Trustee may require additional documents
such as, but not limited to, trust instruments, certificates of
death, appointments as executor or administrator or certificates
of corporate authority. Record ownership may occur before settlement.
Certificates will be issued in fully registered form, transferable
only on the books of the Trustee in denominations of one Unit
or any multiple thereof, numbered serially for purposes of identification.
Unit holders may elect to hold their Units in uncertificated form.
The Trustee will maintain an account for each such Unit holder
and will credit each such account with the number of Units purchased
by that Unit holder. Within two business days of the issuance
or transfer of Units held in uncertificated form, the Trustee
will send to the registered owner of Units a written initial transaction
statement containing a description of the Trust; the number of
Units issued or transferred; the name, address and taxpayer identification
number, if any, of the new registered owner; a notation of any
liens and restrictions of the issuer and any adverse claims to
which such Units are or may be subject or a statement that there
are no such liens, restrictions or adverse claims; and the date
the transfer was registered. Uncertificated Units are transferable
through the same
Page 24
procedures applicable to Units evidenced by certificates (described
above), except that no certificate need be presented to the Trustee
and no certificate will be issued upon the transfer unless requested
by the Unit holder. A Unit holder may at any time request the
Trustee to issue certificates for Units.
Although no such charge is now made or contemplated, a Unit holder
may be required to pay $2.00 to the Trustee per certificate reissued
or transferred and to pay any governmental charge that may be
imposed in connection with each such transfer or exchange. For
new certificates issued to replace destroyed, stolen or lost certificates,
the Unit holder may be required to furnish indemnity satisfactory
to the Trustee and pay such expenses as the Trustee may incur.
Mutilated certificates must be surrendered to the Trustee for
replacement.
How are Income and Capital Distributed?
The Trustee will distribute any net income (other than accreted
interest on the Treasury Obligations in the case of the Growth
& Treasury Trust) received with respect to any of the Securities
in the Trust on or about the Income Distribution Dates to Unit
holders of record on the preceding Income Record Date. See "Summary
of Essential Information." The pro rata share of cash in the Capital
Account of each Trust will be computed as of the fifteenth day
of each month. Proceeds received on the sale of any Securities
in a Trust, to the extent not used to meet redemptions of Units
or pay expenses, will, however, be distributed on the last day
of each month to Unit holders of record on the fifteenth day of
such month if the amount available for distribution equals at
least $0.01 per Unit. The Trustee is not required to pay interest
on funds held in the Capital Account of a Trust (but may itself
earn interest thereon and therefore benefit from the use of such
funds). Notwithstanding, distributions of funds in the Capital
Account of a Trust (if any) will be made on the last day of each
December to Unit holders of record as of December 15. Income with
respect to the original issue discount on the Treasury Obligations
in a Trust (if any) will not be distributed currently, although
Unit holders will be subject to Federal income tax as if a distribution
had occurred. See "What is the Federal Tax Status of Unit Holders?"
Under regulations issued by the Internal Revenue Service, the
Trustee is required to withhold a specified percentage of any
distribution made by a Trust if the Trustee has not been furnished
the Unit holder'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 Unit
holder under certain circumstances by contacting the Trustee,
otherwise the amount may be recoverable only when filing a tax
return. Under normal circumstances the Trustee obtains the Unit
holder's tax identification number from the selling broker. However,
a Unit holder should examine his or her statements from the Trustee
to 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 should be provided as soon as possible.
Within a reasonable time after the Trusts are terminated, each
Unit holder of a Trust will, upon surrender of his Units for redemption,
receive: (i) the pro rata share of the amounts realized upon the
disposition of Equity Securities, unless he elects an In-Kind
Distribution as described below, (ii) a pro rata share of the
amounts realized upon the disposition of the Treasury Obligations
(if any) and (iii) a pro rata share of any other assets of the
Trusts, less expenses of the Trusts, subject to the limitation
that Treasury Obligations in a Growth & Treasury Trust may not
be sold to pay for Trust expenses. Not less than 60 days prior
to the Mandatory Termination Date for the Growth Trust and not
less than 60 days prior to the Treasury Obligations Maturity Date
for the Growth & Treasury Trust, the Trustee will provide written
notice thereof to all Unit holders and will include with such
notice a form to enable Unit holders to elect a distribution of
shares of Equity Securities (an "In-Kind Distribution"), if such
Unit holder owns at least 2,500 Units of a Trust, rather than
to receive payment in cash for such Unit holder's pro rata share
of the amounts realized upon the disposition by the Trustee of
Equity Securities. An In-Kind Distribution will be reduced by
customary transfer and registration charges. To be effective,
the election form, together with surrendered certificates and
other documentation required by the Trustee, must be returned
to the Trustee at least five business days prior to the Mandatory
Termination Date for the Growth Trust and at least five business
days prior to the Treasury Obligations Maturity Date for the Growth
& Treasury Trust. Not less than 60 days prior to the termination
of a Trust, those Unit holders
Page 25
owning at least 2,500 Units will be offered the option of having
the proceeds from the Equity Securities distributed "In-Kind,"
or they will be paid in cash, as indicated above. A Unit holder
may, of course, at any time after the Equity Securities are distributed,
sell all or a portion of the shares.
The Trustee will credit to the Income Account of a Trust any dividends
received on the Equity Securities therein. All other receipts
(e.g. return of principal, capital gains, etc.) are credited to
the Capital Account of such Trust.
The Trustee may establish reserves (the "Reserve Account") within
a Trust for state and local taxes, if any, and any governmental
charges payable out of the Trusts.
What Reports will Unit Holders Receive?
The Trustee shall furnish Unit holders in connection with each
distribution a statement of the amount of income, if any, and
the amount of other receipts, if any, which are being distributed,
expressed in each case as a dollar amount per Unit. 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 Unit holder of a Trust the following information in
reasonable detail: (1) a summary of transactions in a Trust for
such year; (2) any Securities sold during the year and the Securities
held at the end of such year by a Trust; (3) the redemption price
per Unit based upon a computation thereof on the 31st day of December
of such year (or the last business day prior thereto); and (4)
amounts of income and capital distributed during such year.
In order to comply with Federal and state tax reporting requirements,
Unit holders will be furnished, upon request to the Trustee, evaluations
of the Securities in the Trusts furnished to it by the Evaluator.
How May Units be Redeemed?
A Unit holder may redeem all or a portion of his Units by tender
to the Trustee at its corporate trust office in the City of New
York of the certificates representing the Units to be redeemed,
or in the case of uncertificated Units, delivery of a request
for redemption, duly endorsed or accompanied by proper instruments
of transfer with signature guaranteed as explained above (or by
providing satisfactory indemnity, as in connection with lost,
stolen or destroyed certificates), and payment of applicable governmental
charges, if any. No redemption fee will be charged. On the seventh
calendar day following such tender, or if the seventh calendar
day is not a business day, on the first business day prior thereto,
the Unit holder will be entitled to receive in cash an amount
for each Unit equal to the Redemption Price per Unit next computed
after receipt by the Trustee of such tender of Units. The "date
of tender" is deemed to be the date on which Units are received
by the Trustee, except that as regards Units received after 4:00
p.m. Eastern time, the date of tender is the next day on which
the New York Stock Exchange is open for trading and such Units
will be deemed to have been tendered to the Trustee on such day
for redemption at the redemption price computed on that day. Units
so redeemed shall be cancelled.
With respect to the Growth Trust, any Unit holder tendering 2,500
Units or more for redemption may request by written notice submitted
at the time of tender from the Trustee in lieu of a cash redemption
a distribution of shares of Equity Securities in an amount and
value of Equity Securities per Unit equal to the Redemption Price
Per Unit as determined as of the evaluation next following tender.
To the extent possible, In-Kind distributions ("In-Kind Distributions")
shall be made by the Trustee through the distribution of each
of the Equity Securities in book-entry form to the account of
the Unit holder's bank or broker-dealer at the Depository Trust
Company. An In-Kind Distribution will be reduced by customary
transfer and registration charges. The tendering Unit holder will
receive his pro rata number of whole shares of each of the Equity
Securities comprising the portfolio and cash from the Capital
Account equal to the fractional shares to which the tendering
Unit holder is entitled. The Trustee may adjust the number of
shares of any issue of Equity Securities included in a Unit holder's
In-Kind Distribution to facilitate the distribution of whole shares,
such adjustment to be made on the basis of the value of Equity
Securities on the date of tender. If funds in the Capital Account
are insufficient to cover the required cash distribution to the
tendering Unit holder, the Trustee may sell Equity Securities
in the manner described above.
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 Unit holder's tax identification number
in the manner required by such regulations. Any amount so
Page 26
withheld is transmitted to the Internal Revenue Service and may
be recovered by the Unit holder only when filing a tax return.
Under normal circumstances, the Trustee obtains the Unit holder's
tax identification number from the selling broker. However, any
time a Unit holder elects to tender Units for redemption, such
Unit holder 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 income 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 of such Trust.
The Trustee is empowered to sell Securities of a Trust in order
to make funds available for redemption. To the extent that Securities
are sold, the size and diversity of such Trust will be reduced.
Such sales may be required at a time when Securities would not
otherwise be sold and might result in lower prices than might
otherwise be realized. With respect to the Growth & Treasury Trust,
Equity Securities will be sold to meet redemptions of Units before
Treasury Obligations, although Treasury Obligations may be sold
if the Growth & Treasury Trust is assured of retaining a sufficient
principal amount of Treasury Obligations to provide funds upon
maturity of such Trust at least equal to $10.00 per Unit.
The Redemption Price per Unit (as well as the secondary market
Public Offering Price) will be determined on the basis of the
bid price of the Treasury Obligations (if any) and the aggregate
underlying value of the Equity Securities in each Trust plus or
minus cash, if any, in the Income and Capital Accounts of such
Trust, while the Public Offering Price per Unit during the initial
offering period will be determined on the basis of the offering
price of such Treasury Obligations (if any), as of the close of
trading on the New York Stock Exchange on the date any such determination
is made and the aggregate underlying value of the Equity Securities
in each Trust, plus or minus cash, if any, in the Income and Capital
Accounts of each Trust. On the Initial Date of Deposit the Public
Offering Price per Unit (which is based on the OFFERING prices
of the Treasury Obligations (if any) and the aggregate underlying
value of the Equity Securities in each Trust and includes the
sales charge) exceeded the Unit value at which Units could have
been redeemed (based upon the current BID prices of the Treasury
Obligations (if any) and the aggregate underlying value of the
Equity Securities in each Trust) by the amount shown under "Summary
of Essential Information." The Redemption Price per Unit of each
Trust is the pro rata share of each Unit determined by the Trustee
by adding: (1) the cash on hand in the Trust other than cash deposited
in the Trust to purchase Securities not applied to the purchase
of such Securities; (2) the aggregate value of the Securities
(including "when issued" contracts, if any) held in the Trust,
as determined by the Evaluator on the basis of bid prices of the
Treasury Obligations (if any) and the aggregate underlying value
of the Equity Securities in each Trust next computed; and (3)
dividends receivable on the Equity Securities trading ex-dividend
as of the date of computation; and deducting therefrom: (1) amounts
representing any applicable taxes or governmental charges payable
out of the Trust; (2) an amount representing estimated accrued
expenses of the Trust, including but not limited to fees and expenses
of the Trustee (including legal and auditing fees), the Evaluator
and supervisory fees, if any; (3) cash held for distribution to
Unit holders of record of the Trust as of the business day prior
to the evaluation being made; and (4) other liabilities incurred
by the Trust; and finally dividing the results of such computation
by the number of Units of the Trust outstanding as of the date
thereof.
The aggregate value of the Equity Securities will be determined
in the following manner: if the Equity Securities are listed on
a national securities exchange or the NASDAQ National Market System,
this evaluation is generally based on the closing sale prices
on that exchange or that system (unless it is determined that
these prices are inappropriate as a basis for valuation) or, if
there is no closing sale price on that exchange or system, at
the closing bid prices. If the Equity Securities are not so listed
or, if so listed and the principal market therefor is other than
on the exchange, the evaluation shall generally be based on the
current bid price on the over-the-counter market (unless these
prices are inappropriate as a basis for evaluation). If current
bid prices are unavailable, the evaluation is generally determined
(a) on the basis of current bid prices for comparable securities,
(b) by appraising the value of the Equity Securities on the bid
side of the market or (c) by any combination of the above.
Page 27
The right of redemption may be suspended and payment postponed
for any period during which the New York Stock Exchange is closed,
other than for customary weekend and holiday closings, or during
which the Securities and Exchange Commission determines that trading
on the New York Stock Exchange is restricted or any emergency
exists, as a result of which disposal or evaluation of the Securities
is not reasonably practicable, or for such other periods as the
Securities and Exchange Commission may by order permit. Under
certain extreme circumstances, the Sponsor may apply to the Securities
and Exchange Commission for an order permitting a full or partial
suspension of the right of Unit holders to redeem their Units.
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.
How May Units be Purchased by the Sponsor?
The Trustee shall notify the Sponsor of any tender of Units for
redemption. If the Sponsor's bid in the secondary market at that
time equals or exceeds the Redemption Price per Unit, it may purchase
such Units by notifying the Trustee before 1:00 p.m. Eastern time
on the same business day and by making payment therefor to the
Unit holder not later than the day on which the Units would otherwise
have been redeemed by the Trustee. Units held by the Sponsor may
be tendered to the Trustee for redemption as any other Units.
In the event the Sponsor does not purchase Units, the Trustee
may sell Units tendered for redemption in the over-the-counter
market, if any, as long as the amount to be received by the Unit
holder is equal to the amount he would have received on redemption
of the Units.
The offering price of any Units acquired by the Sponsor will be
in accord with the Public Offering Price described in the then
effective prospectus describing such Units. Any profit or loss
resulting from the resale or redemption of such Units will belong
to the Sponsor.
How May Securities be Removed from the Trusts?
The Portfolio of each Trust is not "managed" by the Sponsor or
the Trustee; their activities described herein are governed solely
by the provisions of the Indenture. The Indenture provides that
the Sponsor may (but need not) direct the Trustee to dispose of
an Equity Security in the event that an issuer defaults in the
payment of a dividend that has been declared, that any action
or proceeding has been instituted restraining the payment of dividends
or there exists any legal question or impediment affecting such
Equity Security, that the issuer of the Equity Security has breached
a covenant which would affect the payments of dividends, the credit
standing of the issuer or otherwise impair the sound investment
character of the Equity Security, that the issuer has defaulted
on the payment on any other of its outstanding obligations, that
the price of the Equity Security has declined to such an extent
or other such credit factors exist so that in the opinion of the
Sponsor, the retention of such Equity Securities would be detrimental
to a Trust. Treasury Obligations in the Growth & Treasury Trust
may be sold by the Trustee only pursuant to the liquidation of
such Trust or to meet redemption requests. Pursuant to the Indenture
and with limited exceptions, the Trustee may sell any securities
or other property acquired in exchange for Equity Securities of
either Trust such as those acquired in connection with a merger
or other transaction. If offered such new or exchanged securities
or property, the Trustee shall reject the offer. However, in the
event such securities or property are nonetheless acquired by
a Trust, they may be accepted for deposit in such Trust and either
sold by the Trustee or held in the Trust pursuant to the direction
of the Sponsor (who may rely on the advice of the Portfolio Supervisor).
Proceeds from the sale of Securities by the Trustee are credited
to the Capital Account of a Trust for distribution to Unit holders
or to meet redemptions.
The Trustee may also sell Securities designated by the Sponsor,
or if not so directed, in its own discretion, for the purpose
of redeeming Units of a Trust tendered for redemption and the
payment of expenses; provided however, for the Growth & Treasury
Trust, that in the case of Securities sold to meet redemption
requests, Treasury Obligations may only be sold if the Growth
& Treasury Trust is assured of retaining a sufficient principal
amount of Treasury Obligations to provide funds upon maturity
of the Trust at least equal to $10.00 per Unit. Treasury Obligations
may not be sold by the Trustee to meet Growth & Treasury Trust
expenses.
The Sponsor, in designating Equity Securities to be sold by the
Trustee, will generally make selections in order to maintain,
to the extent practicable, the proportionate relationship among
the number of shares of individual
Page 28
issues of Equity Securities. To the extent this is not practicable,
the composition and diversity of the Equity Securities may be
altered. In order to obtain the best price for a Trust, it may
be necessary for the Sponsor to specify minimum amounts (generally
100 shares) in which blocks of Equity Securities are to be sold.
INFORMATION AS TO SPONSOR, TRUSTEE AND EVALUATOR
Who is the Sponsor?
Nike Securities L.P., the Sponsor, specializes in the underwriting,
trading and distribution of unit investment trusts and other securities.
Nike Securities L.P., an Illinois limited partnership formed in
1991, acts as Sponsor for successive series of The First Trust
Combined Series, The First Trust Special Situations Trust, The
First Trust Insured Corporate Trust, The First Trust of Insured
Municipal Bonds, The First Trust GNMA, Templeton Growth and Treasury
Trust, Templeton Foreign Fund & U.S. Treasury Securities Trust
and The Advantage Growth and Treasury Securities Trust. First
Trust introduced the first insured unit investment trust in 1974
and to date more than $8 billion in First Trust unit investment
trusts have been deposited. The Sponsor's employees include a
team of professionals with many years of experience in the unit
investment trust industry. The Sponsor is a member of the National
Association of Securities Dealers, Inc. and Securities Investor
Protection Corporation and has its principal offices at 1001 Warrenville
Road, Lisle, Illinois 60532; telephone number (708) 241-4141.
As of December 31, 1993, the total partners' capital of Nike Securities
L.P. was $12,743,032 (audited). (This paragraph relates only to
the Sponsor and not to the Trusts or to any series thereof or
to any other Underwriters. The information is included herein
only for the purpose of informing investors as to the financial
responsibility of the Sponsor and its ability to carry out its
contractual obligations. More detailed financial information will
be made available by the Sponsor upon request.)
Who is the Trustee?
The Trustee is United States Trust Company of New York with its
principal place of business at 45 Wall Street, New York, New York
10005 and its unit investment trust offices at 770 Broadway, New
York, New York 10003. Unit holders who have questions regarding
the Trusts, may call the Customer Service Help Line at 1-800-682-7520.
The Trustee is a member of the New York Clearing House Association
and is subject to supervision and examination by the Comptroller
of the Currency, the Federal Deposit Insurance Corporation and
the Board of Governors of the Federal Reserve System.
The Trustee, whose duties are ministerial in nature, has not participated
in the selection of the Securities. For information relating to
the responsibilities of the Trustee under the Indenture, reference
is made to the material set forth under "Rights of Unit Holders."
The Trustee and any successor trustee may resign by executing
an instrument in writing and filing the same with the Sponsor
and mailing a copy of a notice of resignation to all Unit holders.
Upon receipt of such notice, the Sponsor is obligated to appoint
a successor trustee promptly. If the Trustee becomes incapable
of acting or becomes bankrupt or its affairs are taken over by
public authorities, the Sponsor may remove the Trustee and appoint
a successor as provided in the Indenture. If upon resignation
of a trustee no successor has accepted the appointment within
30 days after notification, the retiring trustee may apply to
a court of competent jurisdiction for the appointment of a successor.
The resignation or removal of a trustee becomes effective only
when the successor trustee accepts its appointment as such or
when a court of competent jurisdiction appoints a successor trustee.
Any corporation into which a Trustee may be merged or with which
it may be consolidated, or any corporation resulting from any
merger or consolidation to which a Trustee shall be a party, shall
be the successor Trustee. The Trustee must be a banking corporation
organized under the laws of the United States or any State and
having at all times an aggregate capital, surplus and undivided
profits of not less than $5,000,000.
Limitations on Liabilities of Sponsor and Trustee
The Sponsor and the Trustee shall be under no liability to Unit
holders for taking any action or for refraining from taking any
action in good faith pursuant to the Indenture, or for errors
in judgment, but shall be liable only for their own willful misfeasance,
bad faith, gross negligence (ordinary negligence in the case of
the
Page 29
Trustee) or reckless disregard of their obligations and duties.
The Trustee shall not be liable for depreciation or loss incurred
by reason of the sale by the Trustee of any of the Securities.
In the event of the failure of the Sponsor to act under the Indenture,
the Trustee may act thereunder and shall not be liable for any
action taken by it in good faith under the Indenture.
The Trustee shall not be liable for any taxes or other governmental
charges imposed upon or in respect of the Securities or upon the
interest thereon or upon it as Trustee under the Indenture or
upon or in respect of a Trust which the Trustee may be required
to pay under any present or future law of the United States of
America or of any other taxing authority having jurisdiction.
In addition, the Indenture contains other customary provisions
limiting the liability of the Trustee.
If the Sponsor shall fail to perform any of its duties under the
Indenture or becomes incapable of acting or becomes bankrupt or
its affairs are 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 amounts prescribed
by the Securities and Exchange Commission, or (b) terminate the
Indenture and liquidate the Trusts as provided herein, or (c)
continue to act as Trustee without terminating the Indenture.
Who is the Evaluator?
The Evaluator is First Trust Advisors L.P., an Illinois limited
partnership formed in 1991 and an affiliate of the Sponsor. The
Evaluator's address is 1001 Warrenville Road, Lisle, Illinois
60532. The Evaluator may resign or may be removed by the Sponsor
and the Trustee, in which event the Sponsor and the Trustee are
to use their best efforts to appoint a satisfactory successor.
Such resignation or removal shall become effective upon the acceptance
of appointment by the successor Evaluator. If upon resignation
of the Evaluator no successor has accepted appointment within
30 days after notice of resignation, the Evaluator may apply to
a court of competent jurisdiction for the appointment of a successor.
The Trustee, Sponsor and Unit holders may rely on any evaluation
furnished by the Evaluator and shall have no responsibility for
the accuracy thereof. Determinations by the Evaluator under the
Indenture shall be made in good faith upon the basis of the best
information available to it, provided, however, that the Evaluator
shall be under no liability to the Trustee, Sponsor or Unit holders
for errors in judgment. This provision shall not protect the Evaluator
in any case of willful misfeasance, bad faith, gross negligence
or reckless disregard of its obligations and duties.
OTHER INFORMATION
How May the Indenture be Amended or Terminated?
The Sponsor and the Trustee have the power to amend the Indenture
without the consent of any of the Unit holders when such an amendment
is (1) to cure any ambiguity or to correct or supplement any provision
of the Indenture which may be defective or inconsistent with any
other provision contained therein, or (2) to make such other provisions
as shall not adversely affect the interest of the Unit holders
(as determined in good faith by the Sponsor and the Trustee).
The Indenture for the Growth Trust provides that it shall terminate
upon the Mandatory Termination Date indicated herein under "Summary
of Essential Information." The Indenture provides that the Growth
& Treasury Trust shall terminate upon the maturity, redemption
or other disposition of the last of the Treasury Obligations held
in such Trust, but in no event beyond the Mandatory Termination
Date indicated herein under "Summary of Essential Information."
A Trust may be liquidated at any time by consent of 100% of the
Unit holders of the Trust or, in the case of the Growth Trust,
by the Trustee when the value of the Equity Securities owned by
the Trust as shown by any evaluation, is less than the lower of
$2,000,000 or 20% of the total value of Equity Securities deposited
in such Trust during the primary offering period, or by the Trustee
in the event that Units of a Trust not yet sold aggregating more
than 60% of the Units of the Trust are tendered for redemption
by the Underwriter, including the Sponsor. If a Trust is liquidated
because of the redemption of unsold Units of the Trust by the
Underwriter, the Sponsor will refund to each purchaser of Units
of the Trust the entire sales charge paid by such purchaser. In
the event of termination, written notice thereof will be sent
by the Trustee to all Unit holders of the Trust. Within a reasonable
period after termination, the Trustee will follow the procedures
set forth under "How are Income and Capital Distributed?"
Page 30
Commencing on the Mandatory Termination Date for the Growth Trust
and on the Treasury Obligations Maturity Date for the Growth &
Treasury Trust, Equity Securities will begin to be sold in connection
with the termination of the Trusts. The Sponsor will determine
the manner, timing and execution of the sale of the Equity Securities.
Written notice of any termination of a Trust specifying the time
or times at which Unit holders may surrender their certificates
for cancellation shall be given by the Trustee to each Unit holder
at his address appearing on the registration books of the Trust
maintained by the Trustee. At least 60 days prior to the Mandatory
Termination Date for the Growth Trust and 60 days prior to the
Treasury Obligations Maturity Date for the Growth & Treasury Trust,
the Trustee will provide written notice thereof to all Unit holders
and will include with such notice a form to enable Unit holders
to elect a distribution of shares of Equity Securities (reduced
by customary transfer and registration charges), if such Unit
holder owns at least 2,500 Units of a Trust, rather than to receive
payment in cash for such Unit holder's pro rata share of the amounts
realized upon the disposition by the Trustee of Equity Securities.
All Unit holders of the Growth & Treasury Trust will receive their
pro rata portion of the Treasury Obligations in cash upon the
termination of the Growth & Treasury Trust. To be effective, the
election form, together with surrendered certificates and other
documentation required by the Trustee, must be returned to the
Trustee at least five business days prior to the Mandatory Termination
Date for the Growth Trust and at least five business days prior
to the Treasury Obligations Maturity Date for the Growth & Treasury
Trust. Unit holders not electing a distribution of shares of Equity
Securities will receive a cash distribution from the sale of the
remaining Securities within a reasonable time after the Trusts
are terminated. Regardless of the distribution involved, the Trustee
will deduct from the funds of each Trust any accrued costs, expenses,
advances or indemnities provided by the Trust Agreement, including
estimated compensation of the Trustee and costs of liquidation
and any amounts required as a reserve to provide for payment of
any applicable taxes or other governmental charges. Any sale of
Securities in a Trust upon termination may result in a lower amount
than might otherwise be realized if such sale were not required
at such time. The Trustee will then distribute to each Unit holder
his pro rata share of the balance of the Income and Capital Accounts.
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. Carter, Ledyard & Milburn, will act as counsel for
the Trustee and as special New York tax counsel for the Trusts.
Experts
The statements of net assets, including the schedules of investments,
of the Trusts at the opening of business on the Initial Date of
Deposit appearing in this Prospectus and Registration Statement
have been audited by Ernst & Young LLP, independent auditors,
as set forth in their report thereon appearing elsewhere herein
and in the Registration Statement, and are included in reliance
upon such report given upon the authority of such firm as experts
in accounting and auditing.
Page 31
REPORT OF INDEPENDENT AUDITORS
The Sponsor, Nike Securities L.P., and Unit Holders
THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 93
We have audited the accompanying statements of net assets, including
the schedules of investments, of The First Trust Special Situations
Trust, Series 93, comprised of Telephone Growth Trust, Series
3 and Telephone Growth & Treasury Securities Trust, Series 4,
as of the opening of business on December 8, 1994. These statements
of net assets are the responsibility of the Trusts' Sponsor. Our
responsibility is to express an opinion on these statements of
net assets 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 statements
of net assets are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the statements of net assets. Our procedures included
confirmation of the letters of credit held by the Trustee and
deposited in the Trusts on December 8, 1994. An audit also includes
assessing the accounting principles used and significant estimates
made by the Sponsor, as well as evaluating the overall presentation
of the statements of net assets. We believe that our audit of
the statements of net assets provides a reasonable basis for our
opinion.
In our opinion, the statements of net assets referred to above
present fairly, in all material respects, the financial position
of The First Trust Special Situations Trust, Series 93, comprised
of Telephone Growth Trust, Series 3 and Telephone Growth & Treasury
Securities Trust, Series 4, at the opening of business on December
8, 1994 in conformity with generally accepted accounting principles.
ERNST & YOUNG LLP
Chicago, Illinois
December 8, 1994
Page 32
Statement of Net Assets
At the Opening of Business on the Initial Date of Deposit
of the Securities-December 8, 1994
<TABLE>
<CAPTION>
Telephone
Growth
Trust
Series 3
_________
NET ASSETS
<S> <C>
Investment in Equity Securities represented
by purchase contracts (1)(2) $ 474,245
===========
Units outstanding 50,000
===========
</TABLE>
<TABLE>
<CAPTION>
ANALYSIS OF NET ASSETS
<S> <C>
Cost to investors (3) $ 498,680
Less sales charge (3) (24,435)
___________
Net Assets $ 474,245
===========
</TABLE>
[FN]
NOTES TO STATEMENT OF NET ASSETS
(1) Aggregate cost of the Equity Securities listed under "Schedule
of Investments" for Telephone Growth Trust, Series 3 is based
on their aggregate underlying value.
(2) An irrevocable letter of credit totaling $600,000 issued
by Bankers Trust Company has been deposited with the Trustee covering
the monies necessary for the purchase of the Equity Securities
in Telephone Growth Trust, Series 3 pursuant to contracts for
the purchase of such Equity Securities.
(3) The aggregate cost to investors includes a sales charge computed
at the rate of 4.9% of the Public Offering Price (equivalent to
5.152% of the net amount invested), assuming no reduction of sales
charge for quantity purchases.
Page 33
Statement of Net Assets
At the Opening of Business on the Initial Date of Deposit
of the Securities-December 8, 1994
<TABLE>
<CAPTION>
Telephone
Growth & Treasury
Securities Trust
Series 4
_________________
NET ASSETS
<S> <C>
Investment in Securities represented
by purchase contracts (1)(2) $ 464,003
===========
Units outstanding 50,000
===========
</TABLE>
<TABLE>
<CAPTION>
ANALYSIS OF NET ASSETS
<S> <C>
Cost to investors (3) $ 491,008
Less sales charge (3) (27,005)
___________
Net Assets $ 464,003
===========
</TABLE>
[FN]
NOTES TO STATEMENT OF NET ASSETS
(1) Aggregate cost of the Securities listed under "Schedule of
Investments" for Telephone Growth & Treasury Securities Trust,
Series 4 is based on offering side evaluations of the Treasury
Obligations and the aggregate underlying value of the Equity Securities.
(2) An irrevocable letter of credit totaling $600,000 issued
by Bankers Trust Company has been deposited with the Trustee covering
the monies necessary for the purchase of the Securities in the
Telephone Growth & Treasury Securities Trust, Series 4 pursuant
to contracts for the purchase of such Securities.
(3) The aggregate cost to investors includes a sales charge computed
at the rate of 5.5% of the Public Offering Price (equivalent to
5.820% of the net amount invested), assuming no reduction of sales
charge for quantity purchases.
Page 34
Schedule of Investments
Telephone Growth Trust, Series 3
At the Opening of Business on the Initial Date of Deposit
of the Securities-December 8, 1994
<TABLE>
<CAPTION>
Percentage Cost of
of Aggregate Market Equity
Number Ticker Symbol and Offering Value Securities
of Shares Name of Issuer of Equity Securities (1) Price per Share to Trust (2)
_________ _______________________________________ ____________ _________ ____________
<C> <S> <C> <C> <C>
629 ATI AirTouch Communications, Inc. 3.56% $ 26.875 $ 16,904
603 AT ALLTEL Corporation 3.58% 28.125 16,959
429 AIT Ameritech Corporation 3.60% 39.750 17,053
354 T AT&T Corporation 3.53% 47.250 16,727
337 BEL Bell Atlantic Corporation 3.55% 50.000 16,850
324 BLS BellSouth Corporation 3.55% 52.000 16,848
959 CWP Cable & Wireless PLC* 3.56% 17.625 16,902
585 CTL Century Telephone Enterprises, Inc. 3.56% 28.875 16,892
196 CTC Compania de Telefonos de Chile S.A.* 3.51% 84.875 16,636
913 CTEX C-Tec Corporation 3.66% 19.000 17,347
561 GTE GTE Corporation 3.56% 30.125 16,900
786 LCII LCI International, Inc. 3.65% 22.000 17,292
932 LDDS LDDS Communications, Inc. 3.59% 18.250 17,009
1,117 LTEC Lincoln Telecommunications Company 3.65% 15.500 17,314
895 MCIC MCI Communications Corporation 3.58% 19.000 17,005
463 MFST MFS Communications Company, Inc. 3.49% 35.750 16,552
1,069 MTEL Mobile Telecommunications
Technologies Corporation 3.61% 16.000 17,104
585 PAC Pacific Telesis Group 3.58% 29.000 16,965
314 PHI Philippine Long Distance Telecom
Company* 3.56% 53.750 16,878
583 RCMIF Rogers Cantel Mobile
Communications (Class B)** 3.56% 29.000 16,907
412 SBC SBC Communications, Inc. 3.56% 41.000 16,892
508 SNG Southern New England
Telecommunications Corporation 3.59% 33.500 17,018
566 FON Sprint Corporation 3.55% 29.750 16,838
327 NZT Telecom Corporation of
New Zealand, Ltd.* 3.56% 51.625 16,881
437 TEF Telefonica de Espana* 3.55% 38.500 16,825
320 TMX Telefonos de Mexico S.A. (Class L)* 3.57% 52.875 16,920
410 TDS Telephone and Data Systems, Inc. 3.55% 41.125 16,861
554 VOD Vodafone Group PLC* 3.58% 30.625 16,966
________ ________
Total Investments 100% $474,245
======== ========
</TABLE>
Page 35
[FN]
(1) All Equity Securities are represented by regular way contracts
to purchase such Equity Securities for the performance of which
an irrevocable letter of credit has been deposited with the Trustee.
The contracts to purchase Equity Securities were entered into
by the Sponsor on December 7, 1995.
(2) The cost of the Equity Securities to the Trust represents
the aggregate underlying value with respect to the Equity Securities
acquired (generally determined by the closing sale prices of the
listed Equity Securities and the ask prices of the over-the-counter
traded Equity Securities). The valuation of the Equity Securities
has been determined by the Evaluator, an affiliate of the Sponsor.
The aggregate underlying value of the Equity Securities on the
Initial Date of Deposit was $474,245. Cost and profit to Sponsor
relating to the Equity Securities sold to the Trust were $474,035
and $210, respectively.
* Indicates an American Depositary Receipt. See "What are Equity
Securities?"
** This Equity Security is a U.S. dollar denominated common stock
issued by a foreign company which trades on a United States securities
exchange. See "What are Equity Securities?"
Page 36
Schedule of Investments
Telephone Growth & Treasury Securities Trust, Series 4
At the Opening of Business on the Initial Date of Deposit
of the Securities-December 8, 1994
<TABLE>
<CAPTION>
Percentage of Market Value Cost
Aggregate per Share of
Maturity Offering of Equity Securities
Value Name of Issuer and Title of Security (1) Price Securities to Trust (2)
________ ________________________________________ ________________ ________ ________________
<C> <S> <C> <C> <C>
$500,000 Zero coupon U.S. Treasury bonds 48.89% $226,853
maturing February 15, 2005
Number Ticker Symbol and
of Shares Name of Issuer of Equity Securities (1)
_________ _______________________________________
316 ATI AirTouch Communications, Inc. 1.83% $26.875 $ 8,493
303 AT ALLTEL Corporation 1.84% 28.125 8,522
215 AIT Ameritech Corporation 1.84% 39.750 8,546
178 T AT&T Corporation 1.81% 47.250 8,410
169 BEL Bell Atlantic Corporation 1.82% 50.000 8,450
163 BLS BellSouth Corporation 1.83% 52.000 8,476
481 CWP Cable & Wireless PLC* 1.83% 17.625 8,478
294 CTL Century Telephone Enterprises, Inc. 1.83% 28.875 8,489
99 CTC Compania de Telefonos de Chile S.A.* 1.81% 84.875 8,403
450 CTEX C-Tec Corporation 1.84% 19.000 8,550
281 GTE GTE Corporation 1.82% 30.125 8,465
385 LCII LCI International, Inc. 1.83% 22.000 8,470
468 LDDS LDDS Communications, Inc. 1.84% 18.250 8,541
550 LTEC Lincoln Telecommunications Company 1.84% 15.500 8,525
441 MCIC MCI Communications Corporation 1.81% 19.000 8,379
232 MFST MFS Communications Company, Inc. 1.79% 35.750 8,294
530 MTEL Mobile Telecommunications
Technologies Corporation 1.83% 16.000 8,480
294 PAC Pacific Telesis Group 1.84% 29.000 8,526
158 PHI Philippine Long Distance Telecom
Company* 1.83% 53.750 8,492
292 RCMIF Rogers Cantel Mobile
Communications (Class B)** 1.82% 29.000 8,468
207 SBC SBC Communications, Inc. 1.83% 41.000 8,487
250 SNG Southern New England
Telecommunications Corporation 1.80% 33.500 8,375
284 FON Sprint Corporation 1.82% 29.750 8,449
164 NZT Telecom Corporation of
New Zealand, Ltd.* 1.82% 51.625 8,466
220 TEF Telefonica de Espana* 1.83% 38.500 8,470
160 TMX Telefonos de Mexico S.A. (Class L)* 1.82% 52.875 8,460
206 TDS Telephone and Data Systems, Inc. 1.83% 41.125 8,472
278 VOD Vodafone Group PLC* 1.83% 30.625 8,514
______ ________
Total Equity Securities 51.11% 237,150
______ ________
Total Investments 100% $464,003
====== ========
</TABLE>
Page 37
[FN]
(1) The Treasury Obligations were purchased at a discount from
their par value because there is no stated interest income thereon
(such securities are often referred to as zero coupon U.S. Treasury
bonds). Over the life of the Treasury Obligations the value increases,
so that upon maturity the holders will receive 100% of the principal
amount thereof.
All Securities are represented by regular way contracts to purchase
such Securities for the performance of which an irrevocable letter
of credit has been deposited with the Trustee. The contracts to
purchase Securities were entered into by the Sponsor on December
7, 1994.
(2) The cost of the Securities to the Trust represents the offering
side evaluation as determined by the Evaluator (an affiliate of
the Sponsor) with respect to the Treasury Obligations and the
aggregate underlying value with respect to the Equity Securities
acquired (generally determined by the closing sale prices of listed
Equity Securities and the ask prices of over-the-counter traded
Equity Securities). The offering side evaluation of the Treasury
Obligations is greater than the bid side evaluation of such Treasury
Obligations which is the basis on which the Redemption Price per
Unit will be determined after the initial offering period. The
aggregate value, based on the bid side evaluation of the Treasury
Obligations and the aggregate underlying value of the Equity Securities
on the Initial Date of Deposit, was $463,338. Cost and profit
to the Sponsor relating to the Treasury Obligations sold to the
Trust were $226,190 and $663, respectively. Cost and profit to
Sponsor relating to the Equity Securities sold to the Trust were
$237,082 and $68, respectively.
* Indicates an American Depositary Receipt. See "What are Equity
Securities?"
** This Equity Security is a U.S. dollar denominated common stock
issued by a foreign company which trades on a United States securities
exchange. See "What are Equity Securities?"
Page 38
This page is intentionally left blank.
Page 39
<TABLE>
<CAPTION>
CONTENTS:
<S> <C>
Summary of Essential Information:
Telephone Growth Trust, Series 3 5
Telephone Growth & Treasury Securities Trust,
Series 4 6
The First Trust Special Situations Trust, Series 93:
What is The First Trust Special Situations Trust? 7
What are the Expenses and Charges? 9
What is the Federal Tax Status of Unit Holders? 10
Why are Investments in the Trusts Suitable for
Retirement Plans? 13
Portfolio:
What are Treasury Obligations? 13
What are Equity Securities? 13
Risk Factors 14
What are the Equity Securities Selected for
Telephone Growth Trust, Series 3 and
Telephone Growth & Treasury Securities Trust,
Series 4? 17
What are Some Additional Considerations for
Investors? 19
Public Offering:
How is the Public Offering Price Determined? 20
How are Units Distributed? 22
What are the Sponsor's Profits? 23
Will There be a Secondary Market? 24
Rights of Unit Holders:
How is Evidence of Ownership Issued and
Transferred? 24
How are Income and Capital Distributed? 25
What Reports will Unit Holders Receive? 26
How May Units be Redeemed? 26
How May Units be Purchased by the Sponsor? 28
How May Securities be Removed
from the Trusts? 28
Information as to Sponsor, Trustee and Evaluator:
Who is the Sponsor? 29
Who is the Trustee? 29
Limitations on Liabilities of Sponsor and Trustee 29
Who is the Evaluator? 30
Other Information:
How May the Indenture be Amended or
Terminated? 30
Legal Opinions 31
Experts 31
Report of Independent Auditors 32
Statements of Net Assets:
Telephone Growth Trust, Series 3 33
Telephone Growth & Treasury Securities Trust,
Series 4 34
Schedules of Investments:
Telephone Growth Trust, Series 3 35
Telephone Growth & Treasury Securities Trust,
Series 4 37
</TABLE>
_________________
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL,
OR A SOLICITATION OF AN OFFER TO BUY, SECURITIES IN ANY JURISDICTION
TO ANY PERSON TO WHOM IT IS NOT LAWFUL TO MAKE SUCH OFFER IN SUCH
JURISDICTION.
THIS PROSPECTUS DOES NOT CONTAIN ALL THE INFORMATION SET
FORTH IN THE REGISTRATION STATEMENTS AND EXHIBITS RELATING THERETO,
WHICH THE TRUST HAS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION,
WASHINGTON, D.C. UNDER THE SECURITIES ACT OF 1933 AND THE INVESTMENT
COMPANY ACT OF 1940, AND TO WHICH REFERENCE IS HEREBY MADE.
FIRST TRUST (registered trademark)
Telephone Growth Trust
Series 3
Telephone Growth & Treasury Securities Trust
Series 4
First Trust (registered trademark)
1001 Warrenville Road, Suite 300
Lisle, Illinois 60532
1-708-241-4141
Trustee:
United States Trust Company
of New York
770 Broadway
New York, New York 10003
1-800-682-7520
PLEASE RETAIN THIS PROSPECTUS
FOR FUTURE REFERENCE
December 8, 1994
CONTENTS OF REGISTRATION STATEMENT
A. BONDING ARRANGEMENTS OF DEPOSITOR:
Nike Securities L.P. is covered by a Brokers' Fidelity Bond,
in the total amount of $1,000,000, the insurer being
National Union Fire Insurance Company of Pittsburgh.
B. THIS REGISTRATION STATEMENT ON FORM S-6 COMPRISES
THE FOLLOWING PAPERS AND DOCUMENTS:
The facing sheet
The Cross-Reference Sheet
The Prospectus
The signatures
Exhibits
Financial Data Schedule
S-1
SIGNATURES
The Registrant, The First Trust Special Situations Trust,
Series 93, hereby identifies The First Trust Special Situations
Trust, Series 4 Great Lakes Growth and Treasury Trust, Series 1
and The First Trust Special Situations Trust, Series 18 Wisconsin
Growth and Treasury Securities Trust, Series 1, for purposes of
the representations required by Rule 487 and represents the
following:
(1) that the portfolio securities deposited in the series
as to the securities of which this Registration Statement is
being filed do not differ materially in type or quality from
those deposited in such previous series;
(2) that, except to the extent necessary to identify the
specific portfolio securities deposited in, and to provide
essential financial information for, the series with respect to
the securities of which this Registration Statement is being
filed, this Registration Statement does not contain disclosures
that differ in any material respect from those contained in the
registration statements for such previous series as to which the
effective date was determined by the Commission or the staff; and
(3) that it has complied with Rule 460 under the Securities
Act of 1933.
Pursuant to the requirements of the Securities Act of 1933,
the Registrant, The First Trust Special Situations Trust, Series
93, has duly caused this Amendment to Registration Statement to
be signed on its behalf by the undersigned, thereunto duly
authorized, in the Village of Lisle and State of Illinois on
December 8, 1994.
THE FIRST TRUST SPECIAL SITUATIONS
TRUST, SERIES 93
By NIKE SECURITIES L.P.
Depositor
By Carlos E. Nardo
Senior Vice President
S-2
Pursuant to the requirements of the Securities Act of 1933,
this Amendment to the Registration Statement has been signed
below by the following person in the capacity and on the date
indicated:
NAME TITLE* DATE
Robert D. Van Kampen Sole Director )
of Nike Securities )
Corporation, the ) December 8, 1994
General Partner of )
Nike Securities L.P. )
)
)
) Carlos E. Nardo
) Attorney-in-Fact**
)
)
* The title of the person named herein represents his
capacity in and relationship to Nike Securities L.P.,
Depositor.
** An executed copy of the related power of attorney was
filed with the Securities and Exchange Commission in
connection with the Amendment No. 1 to Form S-6 of The
First Trust Special Situations Trust, Series 18 (File No.
33-42683) and the same is hereby incorporated herein by
this reference.
S-3
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption
"Experts" and to the use of our report dated December 8, 1994 in
Amendment No. 2 to the Registration Statement (Form S-6) (File
No. 33-53273) and related Prospectus of The First Trust Special
Situations Trust, Series 93.
ERNST & YOUNG LLP
Chicago, Illinois
December 8, 1994
CONSENTS OF COUNSEL
The consents of counsel to the use of their names in the
Prospectus included in this Registration Statement will be
contained in their respective opinions to be filed as Exhibits
3.1, 3.2, 3.3 and 3.4 of the Registration Statement.
CONSENT OF FIRST TRUST ADVISORS L.P.
The consent of First Trust Advisors L.P. to the use of its
name in the Prospectus included in the Registration Statement
will be filed as Exhibit 4.1 to the Registration Statement.
S-4
EXHIBIT INDEX
1.1 Form of Standard Terms and Conditions of Trust for The
First Trust Special Situations Trust, Series 18 and
subsequent Series effective October 15, 1991 among Nike
Securities L.P., as Depositor, United States Trust
Company of New York as Trustee, Securities Evaluation
Service, Inc., as Evaluator, and Nike Financial Advisory
Services L.P. as Portfolio Supervisor (incorporated by
reference to Amendment No. 1 to Form S-6 [File No. 33-
42683] filed on behalf of The First Trust Special
Situations Trust, Series 18) and Form of Standard Terms
and Conditions of Trust for The First Trust Special
Situations Trust, Series 22 and certain subsequent
Series, effective November 20, 1991 among Nike
Securities L.P., as Depositor, United States Trust
Company of New York as Trustee, Securities Evaluation
Service, Inc., as Evaluator, and Nike Financial Advisory
Services L.P. as Portfolio Supervisor (incorporated by
reference to Amendment No. 1 to Form S-6 [File No. 33-
43693] filed on behalf of The First Trust Special
Situations Trust, Series 22).
1.1.1 Form of Trust Agreement for Series 93 among Nike
Securities L.P., as Depositor, United States Trust
Company of New York, as Trustee, and First Trust
Advisors L.P., as Evaluator and Portfolio Supervisor.
1.2 Copy of Certificate of Limited Partnership of Nike
Securities L.P. (incorporated by reference to Amendment
No. 1 to Form S-6 [File No. 33-42683] filed on behalf of
The First Trust Special Situations Trust, Series 18).
1.3 Copy of Amended and Restated Limited Partnership
Agreement of Nike Securities L.P. (incorporated by
reference to Amendment No. 1 to Form S-6 [File No. 33-
42683] filed on behalf of The First Trust Special
Situations Trust, Series 18).
1.4 Copy of Articles of Incorporation of Nike Securities
Corporation, the general partner of Nike Securities
L.P., Depositor (incorporated by reference to Amendment
No. 1 to Form S-6 [File No. 33-42683] filed on behalf of
The First Trust Special Situations Trust, Series 18).
1.5 Copy of By-Laws of Nike Securities Corporation, the
general partner of Nike Securities L.P., Depositor
(incorporated by reference to Amendment No. 1 to Form S-
6 [File No. 33-42683] filed on behalf of The First Trust
Special Situations Trust, Series 18).
S-5
1.6 Underwriter Agreement (incorporated by reference to
Amendment No. 1 to Form S-6 [File No. 33-42755] filed on
behalf of The First Trust Special Situations Trust,
Series 19).
2.1 Copy of Certificate of Ownership (included in Exhibit
1.1 filed herewith on page 2 and incorporated herein by
reference).
3.1 Opinion of counsel as to legality of securities being
registered.
3.2 Opinion of counsel as to Federal income tax status of
securities being registered.
3.3 Opinion of counsel as to New York income tax status of
securities being registered.
3.4 Opinion of counsel as to advancement of funds by
Trustee.
4.1 Consent of First Trust Advisors L.P.
6.1 List of Directors and Officers of Depositor and other
related information (incorporated by reference to
Amendment No. 1 to Form S-6 [File No. 33-42683] filed on
behalf of The First Trust Special Situations Trust,
Series 18).
7.1 Power of Attorney executed by the Director listed on
page S-3 of this Registration Statement (incorporated by
reference to Amendment No. 1 to Form S-6 [File No. 33-
42683] filed on behalf of The First Trust Special
Situations Trust, Series 18).
S-6
THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 93
TRUST AGREEMENT
Dated: December 8, 1994
This Trust Agreement among Nike Securities L.P., as
Depositor, United States Trust Company of New York, as
Trustee, First Trust Advisors L.P., as Evaluator and
Portfolio Supervisor, sets forth certain provisions in full
and incorporates other provisions by reference to the
document entitled "Standard Terms and Conditions of Trust
for The First Trust Special Situations Trust, Series 18 and
subsequent Series, Effective October 15, 1991" for the
document entitled Telephone Growth & Treasury Securities
Trust, Series 4 and "Standard Terms and Conditions of Trust
for The First Trust Special Situations Trust, Series 22 and
subsequent Series, Effective November 20, 1991" for
Telephone Growth Trust, Series 3 (herein collectively called
the "Standard Terms and Conditions of Trust"), and such
provisions as are incorporated by reference constitute a
single instrument. All references herein to Articles and
Sections are to Articles and Sections of the Standard Terms
and Conditions of Trust.
WITNESSETH THAT:
In consideration of the premises and of the mutual
agreements herein contained, the Depositor, the Trustee, the
Evaluator and the Portfolio Supervisor agree as follows:
PART I
STANDARD TERMS AND CONDITIONS OF TRUST
Subject to the provisions of Part II and Part III
hereof, all the provisions contained in the Standard Terms
and Conditions of Trust are herein incorporated by reference
in their entirety and shall be deemed to be a part of this
instrument as fully and to the same extent as tough said
provisions had been set forth in full in this instrument.
PART II
SPECIAL TERMS AND CONDITIONS OF TRUST FOR
TELEPHONE GROWTH & TREASURY SECURITIES TRUST, SERIES 4
The following special terms and conditions are hereby
agreed to:
A. The Securities initially deposited in the
Trust pursuant to Section 2.01 of the Standard Terms
and Conditions of Trust are set forth in the Schedules
hereto.
B. (1) The aggregate number of Units
outstanding for the Trust on the Initial Date of
Deposit is 50,000 Units.
(2) The initial fractional undivided
interest in and ownership of the Trust represented by
each Unit thereof shall be 1/50,000.
Documents representing this number of Units for
the Trust are being delivered by the Trustee to the
Depositor pursuant to Section 2.03 of the Standard
Terms and Conditions of Trust.
C. The Percentage Ratio is as follows on the
Initial Date of Deposit:
1.83% AirTouch Communications, Inc., 1.84%
ALLTEL Corporation, 1.84% Ameritech Corporation,
1.81% AT&T Corporation, 1.82% Bell Atlantic
Corporation, 1.83 % BellSouth Corporation, 1.83% Cable
& Wireless PLC, 1.83% Century Telephone Enterprises,
Inc., 1.81% Compania de Telefonos de Chile, S.A.,
1.84% C-Tec Corporation, 1.82% GTE Corporation, 1.83%
LCI International, Inc., 1.84% LDDS Communications,
Inc., 1.84% Lincoln Telecommunications Company,
1.81% MCI Communications Corporation, 1.79% MFS
Communications Company, Inc., 1.83% Mobile
Telecommunications Technologies Corporation,
1.84% Pacific Telesis Group, 1.83% Philippine Long
Distance Telecom Company, 1.82% Rogers Cantel
Mobile Communications (Class B), 1.80% Southern New
England Telecommunications Corporation, 1.83% SBC
Corporation, 1.82% Sprint Corporation, 1.82%
Telecom Corporation of New Zealand, Ltd., 1.83%
Telefonica de Espana, 1.82% Telefonos de Mexico
S.A. (Class L), 1.83% Telephone and Data Systems, Inc.,
1.83% Vodafone Group PLC.
D. The Record Dates shall be as set forth in the
Prospectus under "Summary of Essential Information."
E. The Distribution Dates shall be as set forth
in the Prospectus under "Summary of Essential
Information."
F. The Mandatory Termination Date for the Trust
shall be February 15, 2005.
G. The Treasury Obligations Maturity Date for
the Trust shall be February 15, 2005.
H. The Evaluator's compensation as referred to
in Section 4.03 of the Standard Terms and Conditions of
Trust shall be an annual fee of $0.003 per Unit
calculated on the largest number of Units outstanding
during each period in respect of which a payment is
made pursuant to Section 3.05, payable on a
Distribution Date.
I. The Trustee's Compensation Rate pursuant to
Section 6.04 of the Standard Terms and Conditions of
Trust shall be an annual fee of $0.009 per Unit,
calculated on the largest number of Units outstanding
during each period in respect of which a payment is
made pursuant to Section 3.05. However, in no event,
except as may be otherwise be provided in the Standard
Terms and Conditions of Trust, shall the Trustee
receive compensation in any one year from any Trust of
less than $2,000 for such annual compensation.
J. The Initial Date of Deposit for the Trust is
December 8, 1994.
K. The minimum amount of Equity Securities to be
sold by the Trustee pursuant to Section 5.02 of the
Indenture for the redemption of Units shall be 100
shares.
PART II
SPECIAL TERMS AND CONDITIONS OF TRUST FOR
TELEPHONE GROWTH TRUST, SERIES 3
The following special terms and conditions are hereby
agreed to:
A. The Securities initially deposited in the
Trust pursuant to Section 2.01 of the Standard Terms
and Conditions of Trust are set forth in the Schedules
hereto.
B. (1) The aggregate number of Units
outstanding for the Trust on the Initial Date of
Deposit is 50,000 Units.
(2) The initial fractional undivided
interest in and ownership of the Trust represented by
each Unit thereof shall be 1/50,000.
Documents representing this number of Units for
the Trust are being delivered by the Trustee to the
Depositor pursuant to Section 2.03 of the Standard
Terms and Conditions of Trust.
C. The Percentage Ratio is as follows on the
Initial Date of Deposit:
3.56% AirTouch Communications, Inc., 3.58%
ALLTEL Corporation, 3.60% Ameritech Corporation,
3.53% AT&T Corporation, 3.55% Bell Atlantic
Corporation, 3.55% BellSouth Corporation, 3.56% Cable
& Wireless PLC, 3.56% Century Telephone Enterprises,
Inc., 3.51% Compania de Telefonos de Chile S.A.,
3.66% C-Tec Corporation, 3.56% GTE Corporation, 3.65%
LCI International, Inc., 3.59% LDDS Communications,
Inc., 3.65% Lincoln Telecommunications Company,
3.58% MCI Communications Corporation, 3.49% MFS
Communications Company, Inc., 3.61% Mobile
Telecommunications Technologies Corporation,
3.58% Pacific Telesis Group, 3.56% Philippine Long
Distance Telecom Company, 3.56% Rogers Cantel
Mobile Communications (Class B), 3.56% SBC Corporation,
3.59% Southern New England Telecommunications Corporation,
3.55% Sprint Corporation, 3.56% Telecom Corporation of
New Zealand, Ltd., 3.55% Telefonica de Espana,
3.57% Telefonos de Mexico S.A. (Class L), 3.55%
Telephone and Data Systems, Inc., 3.58% Vodafone Group PLC.
D. The Record Dates shall be as set forth in the
Prospectus under "Summary of Essential Information."
E. The Distribution Dates shall be as set forth
in the Prospectus under "Summary of Essential
Information."
F. The Mandatory Termination Date for the Trust
shall be December 31, 2001.
H. The Evaluator's compensation as referred to
in Section 4.03 of the Standard Terms and Conditions of
Trust shall be an annual fee of $0.003 per Unit
calculated on the largest number of Units outstanding
during each period in respect of which a payment is
made pursuant to Section 3.05, payable on a
Distribution Date.
I. The Trustee's Compensation Rate pursuant to
Section 6.04 of the Standard Terms and Conditions of
Trust shall be an annual fee of $0.009 per Unit,
calculated on the largest number of Units outstanding
during each period in respect of which a payment is
made pursuant to Section 3.05. However, in no event,
except as may be otherwise be provided in the Standard
Terms and Conditions of Trust, shall the Trustee
receive compensation in any one year from any Trust of
less than $2,000 for such annual compensation.
J. The Initial Date of Deposit for the Trust is
December 8, 1994.
K. The minimum amount of Equity Securities to be
sold by the Trustee pursuant to Section 5.02 of the
Indenture for the redemption of Units shall be 100
shares.
PART III FOR TELEPHONE GROWTH & TREASURY
SECURITIES TRUST, SERIES 4
A. The term "Capital Account" as set forth in the
Prospectus shall be deemed to refer to the "Principal
Account."
B. Paragraph (b) of Section 2.01 of the Standard
Terms and Conditions of Trust is amended by substituting the
following sentences for the third and fourth sentences of
such paragraph:
"The Trustee shall not accept any deposit pursuant
to this Section 2.01(b) unless the Depositor and
Trustee have each determined that the maturity value of
the Zero Coupon Obligations included in the deposit,
divided by the number of Units created by reason of the
deposit, shall equal $1.00; written certifications of
such determinations shall be executed by the Depositor
and Trustee and preserved in the Trust records with a
copy of each such written certification to Standard &
Poor's Corporation so long as Units of the Trust are
rated by them. The Depositor shall, at its expense,
cause independent public accountants to review the
Trust's holdings (i) at such time as the Depositor
determines no further deposits shall be made pursuant
to this paragraph and (ii), if earlier, as of the 90th
day following the initial deposit, for the purpose of
certifying whether the face value of the Zero Coupon
Obligations then held by the Trust divided by the Units
then outstanding equals $1.00. A copy of each written
report from the independent public accountants based on
their review will be provided to Standard & Poor's
Corporation so long as Units of the Trust are rated by
them."
C. The last sentence of the first paragraph of
Section 5.02 of the Standard Terms and Conditions of Trust
is amended by substituting "4:00 p.m. Eastern time" for
"12:00 p.m in the City of New York."
D. The second paragraph of Section 5.02 of the
Standard Terms and Conditions of Trust is amended by
substituting the following sentence for the third sentence
of the second paragraph of such Section:
"If such available funds shall be insufficient,
the Trustee shall sell such Securities as have been
designated on the current list for such purpose by the
Portfolio Supervisor, as hereinafter in this Section
5.02 provided, in amounts as the Trustee in its
discretion shall deem advisable or necessary in order
to fund the Principal Account for purposes of such
redemption, provided however, that Zero Coupon
Obligations may not be sold unless the Depositor and
Trustee, which may rely on the advice of the Portfolio
Supervisor, have determined that the face value of the
Zero Coupon Obligations remaining after such proposed
sale, divided by the number of Units outstanding after
the tendered Units are redeemed, shall equal or exceed
$1.00; a written certification as to such
determination shall be executed by the Depositor and
Trustee and preserved in the Trust records with a copy
of each such written certification to Standard & Poor's
Corporation so long as Units of the Trust are rated by
them. Within 90 days of the fiscal year end of the
Trust, the Depositor shall obtain, at its expense, an
annual written certification from the independent
public accountants as to such determination which will
also be provided to Standard & Poor's Corporation so
long as Units of the Trust are rated by them."
E. The third sentence of the seventh paragraph of
Section 5.02 of the Standard Terms and Conditions of Trust
is amended by deleting "a certification from the independent
public accountants to the effect described in the second
paragraph of this Section 5.02" and in its place inserting
"a certification from the Depositor and Trustee to the
effect described in the second paragraph of this Section
5.02."
F. Paragraph (a) of subsection II of Section 3.05 of
the Standard Terms and Conditions of Trust is hereby amended
to substitute the following sentence for the first sentence
of such paragraph:
"On each Distribution Date, the Trustee shall
distribute to each Unit holder of record at the close
of business on the Record Date immediately preceding
such Distribution Date an amount per Unit equal to such
Unit holder's Income Distribution (as defined below),
plus such Unit holder's pro rata share of the balance
of the Principal Account (except for monies on deposit
therein required to purchase Contract Obligations)
computed as of the close of business on such Record
Date after deduction of any amounts provided in
Subsection I, provided, however, that with respect to
distributions other than the distribution occurring in
the month of December of each year, the Trustee shall
not be required to make a distribution from the
Principal Account unless the amount available for
distribution shall equal $1.00 per 1000 Units in the
case of Units initially offered at approximately $1.00
per Unit, or, $1.00 per 100 Units in the case of Units
initially offered at approximately $10.00 per Unit."
G. For purposes of this Trust, all references in the
Standard Terms and Conditions of Trust including provisions
thereof amended hereby to "1.00 per Unit" shall be amended
to read "10.00 per Unit" and all references to "per 1,000
Units" shall be amended to read "per 100 Units."
H. Section 3.12 of the Standard Terms and Conditions
of Trust is hereby deleted in its entirety and replaced with
the following language:
"Section 3.12. Notice to Depositor. In the event
that the Trustee shall have been notified at any time
of any action to be taken or proposed to be taken by at
least a legally required number of holders of any Zero
Coupon Obligation, if any, (including but not limited
to the making of any demand, direction, request, giving
of any notice, consent or waiver or the voting with
respect to any amendment or supplement to any
indenture, resolution, agreement or other instrument
under or pursuant to which the Zero Coupon Obligations,
if any, have been issued) the Trustee shall promptly
notify the Depositor and shall thereupon take such
action or refrain from taking any action as the
Depositor shall in writing direct; provided, however,
that if the Depositor shall not within five Business
Days of the giving of such notice to the Depositor
direct the Trustee to take or refrain from taking any
action, the Trustee shall take such action as it, in
its sole discretion, shall deem advisable.
In the event that the Trustee shall have been
notified at any time of any action to be taken or
proposed to be taken by at least a legally required
number of holders of any Equity Securities deposited in
a Trust, the Trustee shall take such action or omit
from taking any action, as appropriate, so as to insure
that the Equity Securities are voted as closely as
possible in the same manner and the same general
proportion as are the Equity Securities held by owners
other than the Trust.
In the event that an offer by the issuer of any of
the Securities or any other party shall be made to
issue new securities, or to exchange securities, for
Trust Securities, the Trustee shall reject such offer.
However, should any exchange or substitution be
effected notwithstanding such rejection or without an
initial offer, any Securities, cash and/or property
received in exchange shall be deposited hereunder and
shall be promptly sold, if securities or property, by
the Trustee pursuant to the Depositor's direction,
unless the Depositor advises the Trustee to keep such
securities or property. The Depositor may rely on the
Portfolio Supervisor in so advising the Trustee. The
cash received in such exchange and cash proceeds of any
such sales shall be distributed to Unit holders on the
next distribution date in the manner set forth in
Section 3.05 regarding distributions from the Principal
Account. The Trustee shall not be liable or
responsible in any way for depreciation or loss
incurred by reason of any such sale.
Neither the Depositor nor the Trustee shall be
liable to any person for any action or failure to take
action pursuant to the terms of this Section 3.12 other
than failure to notify the Depositor.
Whenever new securities or property is received
and retained by the Trust pursuant to this Section
3.12, the Trustee shall, within 5 days thereafter, mail
to all Unit holders of the Trust notices of such
acquisition unless legal counsel for the Trust
determines that such notice is not required by The
Investment Company Act of 1940, as amended."
I. Section 1.01(4) shall be amended to read as
follows:
"(4)"Portfolio Supervisor" shall mean First Trust
Advisors L.P. and its successors in interest, or any
successor portfolio supervisor appointed as hereinafter
provided."
J. Section 1.01(3) shall be amended to read as
follows:
"(3) "Evaluator" shall mean First Trust Advisors
L.P. and its successors in interest, or any successor
evaluator appointed as hereinafter provided."
PART III FOR TELEPHONE GROWTH TRUST, SERIES 3
A. The term "Capital Account" as set forth in the
Prospectus shall be deemed to refer to the "Principal
Account."
B. Paragraph (g) of Section 6.01 of the Standard
Terms and Conditions of Trust is hereby amended by inserting
the following after the first word thereof:
"(i) the value of any Trust as shown by an
evaluation by the Trustee pursuant to Section 5.01
hereof shall be less than the lower of $2,000,000 or
20% of the total principal amount of Securities
deposited in such Trust, or (ii)"
C. Paragraph (c) of Subsection II of Section 3.05 of
the Standard Terms and Conditions of Trust is hereby amended
to read as follows:
"On each Distribution Date the Trustee shall
distribute to each Unit holder of record at the close
of business on the Record Date immediately preceding
such Distribution Date an amount per Unit equal to such
Unit holder's pro rata share of the balance of the
Principal Account (except for monies on deposit therein
required to purchase Contract Obligations) computed as
of the close of business on such Record Date after
deduction of any amounts provided in Subsection I,
provided, however, that with respect to distributions
other than the distribution occurring in the month of
December of each year, the Trustee shall not be
required to make a distribution from the Principal
Account unless the amount available for distribution
shall equal $1.00 per 1000 Units in the case of Units
initially offered at approximately $1.00 per Unit, or,
$1.00 per 100 Units in the case of Units initially
offered at approximately $10.00 per Unit."
D. For purposes of this Trust, all references in the
Standard Terms and Conditions of Trust including provisions
thereof amended hereby to "$1.00 per Unit" shall be amended
to read "$10.00 per Unit" and all references to "per 1,000
Units" shall be amended to read "per 100 Units."
E. Section 5.02 of the Standard Terms and Conditions
of Trust is amended by adding the following new paragraph
after the second paragraph of such section:
"In lieu of a cash redemption, Unit holders
tendering 2,500 Units or more for redemption may
request from the Trustee by written notice submitted at
the time of tender an in kind distribution of shares of
Securities, to the extent of whole shares. To the
extent possible, in kind distributions of Securities
shall be made by the Trustee through the distribution
of each of the Securities in book-entry form to the
account of the Unit holder's bank or broker-dealer at
the Depository Trust Company. An in kind distribution
will be reduced by all expenses in connection with
customary transfer and registration charges. The
tendering Unit holder will receive his pro rata number
of whole shares of each of the Securities comprising
the portfolio and cash from the Principal Account equal
to the fractional shares to which the tendering Unit
holder is entitled. The Trustee may, but shall not be
required to, adjust the number of shares of any issue
of Securities included in a Unit holder's in kind
distribution to facilitate the distribution of whole
shares, such adjustment to be made on the basis of the
value of Securities on the date of tender. If funds in
the Principal Account are insufficient to cover the
required cash distribution to the tendering Unit
holder, the Trustee may sell Securities in the manner
described in this Section 5.02."
F. Section 8.02 of the Standard Terms and Conditions
of Trust shall be amended to delete the reference to
"100,000 Units" and substitute "2,500 Units" in the third
sentence of the second paragraph thereof.
G. The first paragraph of Section 3.05.II(a) of the
Standard Terms and Conditions of Trust is hereby amended to
read in its entirety as follows:
"II. (a) On each Distribution Date, the Trustee
shall distribute to each Unit holder of record at the
close of business on the Record Date immediately
preceding such Distribution Date an amount per Unit
equal to such Unit holder's Income Distribution (as
defined below), plus such Unit holder's pro rata share
of the balance of the Principal Account (except for
monies on deposit therein required to purchase Contract
Obligations) computed as of the close of business on
such Record Date after deduction of any amounts
provided in Subsection I, provided, however, that with
respect to distributions other than the distribution
occurring in the month of December of each year, the
Trustee shall not be required to make a distribution
from the Principal Account unless the amount available
for distribution shall equal $1.00 per 100 Units."
H. Section 3.05.II(b) of the Standard Terms and
Conditions of Trust is hereby amended to read in its
entirety as follows:
"(b) For purposes of this Section 3.05, the Unit
holder's Income Distribution shall be equal to such
Unit holder's pro rata share of the cash balance in the
Income Account computed as of the close of business on
the Record Date immediately preceding such Income
Distribution after deduction of (i) the fees and
expenses then deductible pursuant to Section 3.05.I.
and (ii) the Trustee's estimate of other expenses
properly chargeable to the Income Account pursuant to
the Indenture which have accrued, as of such Record
Date, or are otherwise properly attributable to the
period to which such Income Distribution relates."
I. Section 3.11 of the Standard Terms and Conditions
of Trust is hereby deleted in its entirety and replaced with
the following language:
"Section 3.11 Notice to Depositor. In the event
that the Trustee shall have been notified at any time
of any action to be taken or proposed to be taken by at
least a legally required number of holders of the
equity securities (the "Equity Securities") (including
but not limited to the making of any demand, direction,
request, giving of any notice, consent or waiver or the
voting with respect to any amendment or supplement to
any indenture, resolution, agreement or other
instrument under or pursuant to which the Contract
Obligations, if any, have been issued) the Trustee
shall promptly notify the Depositor and shall thereupon
take such action or refrain from taking any action as
the Depositor shall in writing direct; provided,
however, that if the Depositor shall not within five
Business Days of the giving of such notice to the
Depositor direct the Trustee to take or refrain from
taking any action, the Trustee shall take such action
as it, in its sole discretion, shall deem advisable.
In the event that the Trustee shall have been
notified at any time of any action to be taken or
proposed to be taken by at least a legally required
number of holders of any Equity Securities deposited in
a Trust, the Trustee shall take such action or omit
from taking any action, as appropriate, so as to insure
that the Equity Securities are voted as closely as
possible in the same manner and the same general
proportion as are the Equity Securities held by owners
other than the Trust.
In the event that an offer by the issuer of any of
the Securities or any other party shall be made to
issue new securities, or to exchange securities, for
Trust Securities, the Trustee shall reject such offer.
However, should any exchange or substitution be
effected notwithstanding such rejection or without an
initial offer, any Securities, cash and/or property
received in exchange shall be deposited hereunder and
shall be promptly sold, if securities or property, by
the Trustee pursuant to the Depositor's direction,
unless the Depositor advises the Trustee to keep such
securities or property. The Depositor may rely on the
Portfolio Supervisor in so advising the Trustee. The
cash received in such exchange and cash proceeds of any
such sales shall be distributed to Unit holders on the
next distribution date in the manner set forth in
Section 3.05 regarding distributions from the Principal
Account. The Trustee shall not be liable or
responsible in any way for depreciation or loss
incurred by reason of any such sale.
Neither the Depositor nor the Trustee shall be
liable to any person for any action or failure to take
action pursuant to the terms of this Section 3.11 other
than failure to notify the Depositor.
Whenever new securities or property is received
and retained by the Trust pursuant to this Section
3.11, the Trustee shall, within 5 days thereafter, mail
to all Unit holders of the Trust notices of such
acquisition unless legal counsel for the Trust
determines that such notice is not required by The
Investment Company Act of 1940, as amended."
J. Section 1.01(4) shall be amended to read as
follows:
"(4) "Portfolio Supervisor" shall mean First Trust
Advisors L.P. and its successors in interest, or any
successor portfolio supervisor appointed as hereinafter
provided."
K. Section 1.01(3) shall be amended to read as
follows:
"(3) "Evaluator" shall mean First Trust Advisors
L.P. and its successors in interest, or any successor
evaluator appointed as hereinafter provided."
IN WITNESS WHEREOF, Nike Securities L.P., United States
Trust Company of New York and First Trust Advisors L.P. have
each caused this Trust Agreement to be executed and the
respective corporate seal to be hereto affixed and attested
(if applicable) by authorized officers; all as of the day,
month and year first above written.
NIKE SECURITIES L.P.,Depositor
By Carlos E. Nardo
Senior Vice President
UNITED STATES TRUST COMPANY OF
NEW YORK, Trustee
(SEAL) By Thomas Porrazzo
Vice President
Attest:
Rosalia A. Raviele
Assistant Vice President
FIRST TRUST ADVISORS L.P.,
Evaluator
By Carlos E. Nardo
Senior Vice President
FIRST TRUST ADVISORS L.P.,
Portfolio Supervisor
By Carlos E. Nardo
Senior Vice President
SCHEDULE A TO TRUST AGREEMENT
Securities Initially Deposited
The First Trust Special Situations Trust, Series 93
(Note: Incorporated herein and made a part hereof
for the Trust is the "Schedule of Investments" for the
Trust as set forth in the Prospectus.)
CHAPMAN AND CUTLER
111 WEST MONROE STREET
CHICAGO, ILLINOIS 60603
December 8, 1994
Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
Re: The First Trust Special Situations Trust, Series 93
Gentlemen:
We have served as counsel for Nike Securities L.P., as
Sponsor and Depositor of The First Trust Special Situations
Trust, Series 93 in connection with the preparation, execution
and delivery of a Trust Agreement dated December 8, 1994 among
Nike Securities L.P., as Depositor, United States Trust Company
of New York, as Trustee, First Trust Advisors L.P., as Evaluator,
and First Trust Advisors L.P., as Portfolio Supervisor, pursuant
to which the Depositor has delivered to and deposited the
Securities listed in Schedule A to the Trust Agreement with the
Trustee and pursuant to which the Trustee has issued to or on the
order of the Depositor a certificate or certificates representing
units of fractional undivided interest in and ownership of the
Fund created under said Trust Agreement.
In connection therewith, we have examined such pertinent
records and documents and matters of law as we have deemed
necessary in order to enable us to express the opinions
hereinafter set forth.
Based upon the foregoing, we are of the opinion that:
1. the execution and delivery of the Trust Agreement and
the execution and issuance of certificates evidencing the Units
in the Fund have been duly authorized; and
2. the certificates evidencing the Units in the Fund when
duly executed and delivered by the Depositor and the Trustee in
accordance with the aforementioned Trust Agreement, will
constitute valid and binding obligations of the Fund and the
Depositor in accordance with the terms thereof.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement (File No. 33-53273)
relating to the Units referred to above, to the use of our name
and to the reference to our firm in said Registration Statement
and in the related Prospectus.
Respectfully submitted,
CHAPMAN AND CUTLER
EFF:jlg
CHAPMAN AND CUTLER
111 WEST MONROE STREET
CHICAGO, ILLINOIS 60603
December 8, 1994
Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
United States Trust Company of New York
770 Broadway
New York, New York 10003
Re: The First Trust Special Situations Trust, Series 93
Gentlemen:
We have acted as counsel for Nike Securities L.P.,
Depositor of The First Trust Special Situations Trust,
Series 93 (the "Fund"), in connection with the issuance of
units of fractional undivided interests in the Trust of said
Fund (the "Trust"), under a Trust Agreement, dated December
8, 1994 (the "Indenture"), between Nike Securities L.P., as
Depositor, United States Trust Company of New York, as
Trustee, First Trust Advisors L.P., as Evaluator and First
Trust Advisors L.P., as Portfolio Supervisor.
In this connection, we have examined the Registration
Statement, the form of Prospectus proposed to be filed with
the Securities and Exchange Commission, the Indenture and
such other instruments and documents we have deemed
pertinent. The opinions expressed herein assume that the
Trust will be administered, and investments by the Trust
from proceeds of subsequent deposits, if any, will be made,
in accordance with the terms of the Indenture. The Trust
holds both Treasury Obligations and Equity Securities
(collectively, the "Securities") as such terms are defined
in the Prospectus.
Based upon the foregoing and upon an investigation of
such matters of law as we consider to be applicable, we are
of the opinion that, under existing federal income tax law:
I. Each Trust is not an association taxable as a
corporation for Federal income tax purposes; each Unit
holder will be treated as the owner of a pro rata
portion of the assets of a Trust under the Internal
Revenue Code of 1986 (the "Code"); the income of a
Trust will be treated as income of the Unit holders
thereof under the Code; and an item of income of each
Trust will have the same character in the hands of a
Unit holder as it would have in the hands of each
Trustee. Each Unit holder will be considered to have
received his pro rata share of income derived from each
Trust asset when such income is received by the Trust.
II. Each Unit holder will have a taxable event
when a Trust disposes of a Security (whether by sale,
exchange, redemption, or payment at maturity) or upon
the sale or redemption of Units by such Unit holder.
The price a Unit holder pays for his Units, including
sales charges, is allocated among his pro rata portion
of each Security held by a Trust (in proportion to the
fair market values thereof on the date the Unit holder
purchases his Units) in order to determine his initial
cost for his pro rata portion of each Security held by
a Trust. The Treasury Obligations are treated as bonds
that were originally issued at an original issue
discount. Because the Treasury Obligations represent
interest in "stripped" U.S. Treasury bonds, a Unit
holder's initial cost for his pro rata portion of each
Treasury Obligation held by the Growth and Treasury
Trust (determined at the time he acquires his Units, in
the manner described above) shall be treated as its
"purchase price" by the Unit holder. Under the special
rules relating to stripped bonds, original issue
discount is effectively treated as interest for Federal
income tax purposes and the amount of original issue
discount in this case is generally the difference
between the bond's purchase price and its stated
redemption price at maturity. A Unit holder will be
required to include in gross income for each taxable
year the sum of his daily portions of original issue
discount attributable to the Treasury Obligations held
by the Growth and Treasury Trust as such original issue
discount accrues and will in general be subject to
Federal income tax with respect to the total amount of
such original issue discount that accrues for such year
even though the income is not distributed to the Unit
holders during such year to the extent it is greater
than or equal to a "de minimis" amount determined under
a Treasury Regulation (the "Regulation") issued on
December 28, 1992 as described below. To the extent
the amount of such discount is less than the respective
"de minimis" amount, such discount shall be treated as
zero. In general, original issue discount accrues
daily under a constant interest rate method which takes
into account the semi-annual compounding of accrued
interest. In the case of the Treasury Obligations,
this method will generally result in an increasing
amount of income to the Unit holders each year. For
Federal income tax purposes, a Unit holder's pro rata
portion of dividends as defined by Section 316 of the
Code paid by a corporation are taxable as ordinary
income to the extent of such corporation's current and
accumulated "earnings and profits." A Unit holder's
pro rata portion of dividends which exceed such current
and accumulated earnings and profits will first reduce
a Unit holder's tax basis in such Security (and
accordingly his basis in his Units), and to the extent
that such dividends exceed a Unit holder's tax basis in
such Security shall be treated as capital gain. In
general, any such capital gain will be short term
unless a Unit holder has held his units for more than
one year.
III. A Unit holder's portion of gain, if any, upon
the sale or redemption of Units or the disposition of
Securities held by a Trust will generally be considered
a capital gain except in the case of a dealer or a
financial institution and will be generally long-term
if the Unit holder has held his Units for more than one
year. A Unit holder's portion of loss, if any, upon
the sale or redemption of Units or the disposition of
Securities held by a Trust will generally be considered
a capital loss except in the case of a dealer or a
financial institution and will be generally long-term
if the Unit holder has held his Units for more than one
year.
IV. The Code provides that "miscellaneous
itemized deductions" are allowable only to the extent
that they exceed two percent of an individual
taxpayer's adjusted gross income. Miscellaneous
itemized deductions subject to this limitation under
present law include a Unit holder's pro rata share of
expenses paid by a Trust, including fees of the Trustee
and the Evaluator.
The Code provides a complex set of rules governing the
accrual of original issue discount, including special rules
relating to "stripped" debt instruments such as the Treasury
Obligations. These rules provide that original issue
discount generally accrues on the basis of a constant
compound interest rate. Special rules apply if the purchase
price of a Treasury Obligation exceeds its original issue
price plus the amount of original issue discount which would
have previously accrued, based upon its issue price (its
"adjusted issue price"). Similarly, these special rules
would apply to a Unit holder if the tax basis of his pro
rata portion of a Treasury Obligation issued with original
issue discount exceeds his pro rata portion of its adjusted
issue price. The application of these rules will also vary
depending on the value of the Treasury Obligations on the
date a Unit holder acquires his Units, and the price a Unit
holder pays for his Units. In addition, as discussed above,
the Regulation provides that the amount of original issue
discount on a stripped bond is considered zero if the actual
amount of original issue discount on such stripped bond as
determined under Section 1286 of the Code is less than a "de
minimis" amount, which, the Regulation provides, is the
product of (i) 0.25 percent of the stated redemption price
at maturity and (ii) the number of full years from the date
the stripped bond is purchased (determined separately for
each new purchaser thereof) to the final maturity date of
the bond.
For taxable years beginning after December 31, 1986 and
before January 1, 1996, certain corporations may be subject
to the environmental tax (the "Superfund Tax") imposed by
Section 59A of the Code. Income received from, and gains
recognized from the disposition of, a Security by the Trust
will be included in the computation of the Superfund Tax by
such corporations holding Units in the Trust.
The scope of this opinion is expressly limited to the
matters set forth herein, and, except as expressly set forth
above, we express no opinion with respect to any other
taxes, including state or local taxes or collateral tax
consequences with respect to the purchase, ownership and
disposition of Units.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement (File No. 33-53273)
relating to the Units referred to above and to the use of
our name and to the reference to our firm in said
Registration Statement and in the related Prospectus.
Very truly yours,
CHAPMAN AND CUTLER
EFF/jlg
CARTER, LEDYARD & MILBURN
COUNSELLORS AT LAW
2 WALL STREET
NEW YORK, NEW YORK 10005
December 8, 1994
United States Trust Company
of New York, as Trustee of
The First Trust Special
Situations Trust, Series 93
Telephone Growth Trust, Series 3
Telephone Growth & Treasury
Securities Trust, Series 4
770 Broadway - 6th Floor
New York, New York 10003
Attention: Mr. C. William Steelman
Executive Vice President
Re: The First Trust Special Situations Trust, Series 93
Telephone Growth Trust, Series 3
Telephone Growth & Treasury Securities Trust, Series 4
Dear Sirs:
We are acting as special counsel with respect to New York
tax matters for The First Trust Special Situations Trust, Series
93, Telephone Growth & Treasury Securities Trust, Series 4 (the
"Growth & Treasury Trust") and Telephone Growth Trust, Series 3
(the "Growth Trust"), (collectively, the "Trusts"), which will be
established under a Standard Terms and Conditions of Trust dated
October 15, 1991 and November 20, 1991, respectively, and a
related Trust Agreement dated as of today (collectively, the
"Indenture"), among Nike Securities L.P., as Depositor (the
"Depositor"); First Trust Advisors L.P., as Evaluator; First
Trust Advisors L.P., as Portfolio Supervisor and United States
Trust Company of New York, as Trustee (the "Trustee"). Pursuant
to the terms of the Indenture, units of fractional undivided
interest in the Trusts (the "Units") will be issued in the
aggregate number set forth in the Indenture.
We have examined and are familiar with originals or certified
copies, or copies otherwise identified to our satisfaction, of
such documents as we have deemed necessary or appropriate for the
purpose of this opinion. In giving this opinion, we have relied
upon the two opinions, each dated today and addressed to the
Trustee, of Chapman and Cutler, counsel for the Depositor, with
respect to the matters of law set forth therein.
Based upon the foregoing, we are of the opinion that:
1. The Trusts will not constitute associations taxable as
corporations under New York law, and accordingly will not be
subject to the New York State franchise tax or the New York City
general corporation tax.
2. Under the income tax laws of the State and City of New York,
the income of the Trusts will be considered the income of the
holders of the Units.
We consent to the filing of this opinion as an exhibit to the
Registration Statement (No. 33-53273) filed with the Securities
and Exchange Commission with respect to the registration of the
sale of the Units and to the references to our name under the
captions "What is the Federal Tax Status of Unit Holders?" and
"Legal Opinions" in such Registration Statement and the
preliminary prospectus included therein.
Very truly yours,
Carter, Ledyard & Milburn
CARTER, LEDYARD & MILBURN
COUNSELLORS AT LAW
2 WALL STREET
NEW YORK, NEW YORK 10005
December 8, 1994
United States Trust Company
of New York, as Trustee of
The First Trust Special Situations
Trust, Series 93
Telephone Growth Trust, Series 3
Telephone Growth & Treasury
Securities Trust, Series 4
770 Broadway - 6th Floor
New York, New York 10003
Attention: Mr. C. William Steelman
Executive Vice President
Re: The First Trust Special Situations Trust, Series 93
Telephone Growth Trust, Series 3
Telephone Growth & Treasury Securities Trust, Series 4
Dear Sirs:
We are acting as counsel for United States Trust Company of
New York (the "Trust Company") in connection with the execution
and delivery of a Standard Terms and Conditions of Trust dated
October 15, 1991 and November 20, 1991, respectively, and a
related Trust Agreement, dated today's date (collectively, the
"Indenture"), among Nike Securities L.P., as Depositor (the
"Depositor"); First Trust Advisors L.P., as Evaluator; First
Trust Advisors L.P., as Portfolio Supervisor; and the Trust
Company, as Trustee (the "Trustee"), establishing The First Trust
Special Situations Trust, Series 93, Telephone Growth & Treasury
Securities Trust, Series 4 (the "Growth & Treasury Trust") and
Telephone Growth Trust, Series 3 (the "Growth Trust"),
(collectively, the "Trusts"), and the execution by the Trust
Company, as Trustee under the Indenture, of a certificate or
certificates evidencing ownership of units of each Trust (such
certificate or certificates and such aggregate units being herein
called "Certificates" and "Units"), each of which represents an
undivided interest in such Trust, which, as to the Growth &
Treasury Trust consists of "zero coupon" U.S. Treasury bonds and
common stocks, and as to the Growth Trust consists of common
stock (including, in the case of each Trust, confirmations of
contracts for the purchase of certain Bonds and/or stock not
delivered and cash, cash equivalents or an irrevocable letter of
credit or a combination thereof, in the amount required for such
purchase upon the receipt of such B onds and/or stock), such
obligations being defined in the Indenture as Securities and
listed in the Schedule to the Indenture.
We have examined the Indenture, the Closing Memorandum dated
today's date, a specimen Certificate, and such other documents as
we have deemed necessary in order to render this opinion. Based
on the foregoing, we are of the opinion that:
1. The Trust Company is a duly organized and existing
corporation having the powers of a trust company under the laws
of the State of New York.
2. The Indenture has been duly executed and delivered by the
Trust Company and, assuming due execution and delivery by the
other parties thereto, constitutes the valid and legally binding
obligation of the Trust Company.
3. The Certificates are in proper form for execution and
delivery by the Trust Company, as Trustee.
4. The Trust Company, as Trustee, has duly executed and
delivered to or upon the order of the Depositor a Certificate or
Certificates evidencing ownership of the Units, registered in the
name of the Depositor. Upon receipt of confirmation of the
effectiveness of the registration statement for the sale of the
Units filed with the Securities and Exchange Commission under the
Securities Act of 1933, the Trustee may deliver such other
Certificates, in such names and denominations as the Depositor
may request, to or upon the order of the Depositor as provided in
the Closing Memorandum.
5. The Trust Company, as Trustee, may lawfully under the New
York Banking Law advance to the Growth Trust amounts as may be
necessary to provide monthly interest distributions of
approximately equal amounts, and be reimbursed, without interest,
for any such advances from funds in the income account on the
ensuing record date, as provided in the Indenture.
In rendering the foregoing opinion, we have not considered, among
other things, whether the Securities have been duly authorized
and delivered.
Very truly yours,
CARTER, LEDYARD & MILBURN
First Trust Advisors L.P.
1001 Warrenville Road
Lisle, Illinois 60187
December 8, 1994
Nike Securities L.P.
1001 Warrenville Road
Lisle, IL 60532
Re: THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 93
Gentlemen:
We have examined the Registration Statement File No. 33-
53273 for the above captioned fund. We hereby consent to the use
in the Registration Statement of the references to Frist Trust
Advisors L.P. as evaluator.
You are hereby authorized to file a copy of this letter with
the Securities and Exchange Commission.
Sincerely,
First Trust Advisors L.P.
Carlos E. Nardo
Senior Vice President
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND> This schedule contains summary financial information
extracted from Amendment number 1 to form S-6 and is qualified
in its entirety by reference to such Amendment number 1 to form S-6.
</LEGEND>
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<NUMBER> 3
<NAME> Telephone Growth Trust
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> Other
<FISCAL-YEAR-END> DEC-8-1994
<PERIOD-START> DEC-8-1994
<PERIOD-END> DEC-8-1994
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<INVESTMENTS-AT-VALUE> 474,245
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<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 474,245
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<PAID-IN-CAPITAL-COMMON> 474,245
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<NET-ASSETS> 474,245
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</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND> This schedule contains summary financial information
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</LEGEND>
<SERIES>
<NUMBER> 4
<NAME> Telephone Growth & Treasury
Securities Trust
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> Other
<FISCAL-YEAR-END> DEC-8-1994
<PERIOD-START> DEC-8-1994
<PERIOD-END> DEC-8-1994
<INVESTMENTS-AT-COST> 464,003
<INVESTMENTS-AT-VALUE> 464,003
<RECEIVABLES> 0
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<TOTAL-ASSETS> 464,003
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<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 464,003
<SHARES-COMMON-STOCK> 50,000
<SHARES-COMMON-PRIOR> 50,000
<ACCUMULATED-NII-CURRENT> 0
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