SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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 98
B. Name of Depositor: NIKE SECURITIES L.P.
C. Complete Address of Depositor's 1001 Warrenville Road
Principal Executive Offices: Lisle, Illinois 60532
D. Name and Complete Address of
Agents for Service: NIKE SECURITIES L.P.
Attention: James A. Bowen
Suite 300
1001 Warrenville Road
Lisle, Illinois 60532
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 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 the Public: ____ Check if it is
proposed that this filing
will become effective on
_____ at ____ p.m.
pursuant to Rule 487.
The registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its effective
date until the registrant shall file a further amendment which
specifically states that this Registration Statement shall
thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement
shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 98
Cross-Reference Sheet
(Form N-8B-2 Items required by Instructions as
to the Prospectus in Form S-6)
FORM N-8B-2 FORM S-6
ITEM NUMBER HEADING IN PROSPECTUS
I. ORGANIZATION AND GENERAL INFORMATION
1. (a) Name of trust Prospectus front cover
(b) Title of securities issued Summary of Essential
Information
2. Name and address of each Information as to
depositor Sponsor, Trustee and
Evaluator
3. Name and address of Information as to
trustee Sponsor, Trustee and
Evaluator
4. Name and address of Underwriting
principal underwriters
5. State of organization The First Trust Special
of trust Situations Trust
6. Execution and termination The First Trust Special
of trust agreement Situations Trust; Other
Information
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 Rights of Unit Holders
securities
(b) Cumulative or distributive
securities The First Trust Special
Situations Trust
(c) Redemption Rights of Unit Holders
(d) Conversion, transfer, etc. Rights of Unit Holders
(e) Periodic payment plan
certificates *
(f) Voting rights Rights of Unit Holders;
Other Information
(g) Notice of certificate- Rights of Unit Holders;
holders Other Information
(h) Consents required Rights of Unit Holders;
Other Information
(i) Other provisions The First Trust Special
Situations Trust
11. Types of securities comprising The First Trust Special
units Situations Trust
12. Certain information
regarding periodic payment
plan 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
plan certificates *
(c) Certain percentages Summary of Essential
Information; The First
Trust Special Situations
Trust; Public Offering
(d) Difference in price offered Public Offering
for any class of transactions
to any class or group of
individuals
(e) Certain other load fees, Rights of Unit Holders
expenses, etc. payable by
holders
(f) Certain profits receivable The First Trust Special
by depositor, principal Situations Trust
underwriters, trustee or
affiliated persons
(g) Ratio of annual charges to
income *
14. Issuance of trust's Rights of Unit Holders
securities
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
disposition of income Rights of Unit Holders
(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 and
successor Information as to
Sponsor, Trustee and
Evaluator
(e) and (f) Depositor, removal Information as to
and successor 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 other *
persons 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
securities by states Public Offering
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;
Underwriting
(c) Selling agreements Public Offering
39. (a) Organization of principal Information as to
underwriters Sponsor, Trustee and
Evaluator
(b) N.A.S.D. membership of Information as to
principal underwriters Sponsor, Trustee and
Evaluator
40. Certain fee received by See Items 13(a) and 13(e)
principal underwriters
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 Public Offering; Rights
in underlying securities of Unit Holders
V. INFORMATION CONCERNING THE TRUSTEE OR CUSTODIAN
48. Organization and regulation Information as to
of trustee 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 OR
SECURITIES
51. Insurance of holders of *
trust's securities
VII. POLICY OF REGISTRANT
52. (a) Provisions of trust The First Trust Special
agreement with respect Situations Trust; Rights
to selection or elimination of Unit Holders
of underlying securities
(b) Transactions involving
elimination of underlying
securities *
(c) Policy regarding The First Trust Special
substitution or elimination Situations Trust; Rights
of underlying securities 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. Certain information regarding
periodic payment plan
certificates
56. Certain information regarding
periodic payment plan
certificates
57. Certain information regarding *
periodic payment plan
certificates
58. Certain information regarding
periodic payment plan
certificates
59. Financial statements Report of Independent
(Instruction 1(b) to Auditors; Statement of
Form S-6) Net Assets
__________________________
* Inapplicable, answer negative or not required.
Preliminary Prospectus Dated May 13, 1994
THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 98
10,000 Units (A Unit Investment Trust)
The attached final Prospectus for a prior Series of the Fund
is hereby used as a preliminary Prospectus for the above stated
Series. The narrative information and structure of the attached
final Prospectus will be substantially the same as that of the
final Prospectus for this Series with the exception of the
issuers of the equity securities. Information with respect to
pricing, the number of Units, dates and additional summary
information regarding the equity securities to be deposited in
this Series will be different since each Series has a unique
Portfolio. Accordingly the information contained herein with
regard to the previous Series should be considered as being
included for informational purposes only.
At present, it is the intention of the Sponsor to deposit
the following equity securities in the Portfolio of each Series.
Each of the equity securities listed below will not exceed 6% of
the Aggregate Offering Price of such Series. The final Portfolio
of each Series may contain additional equity securities each of
which will not exceed 6% of the Aggregate Offering Price of such
Series.
Ticker Symbol and Name of Issuer of Equity Securities
ABT Abbott Laboratories
AZA Alza Corporation
AHP American Home Products Corporation
BMY Bristol-Myers Squibb Company
FRX Forest Laboratories, Inc. (Class A)
GLX Glaxo Holdings PLC
JNJ Johnson & Johnson
LLY Lilly (Eli) & Company
MKC Marion Merrell Dow, Inc.
MYL Mylan Laboratories, Inc.
PFE Pfizer, Inc.
RPR Rhone-Poulenc Rorer, Inc.
SGP Schering-Plough
SBH SmithKline Beacham PLC
TEVIY Teva Pharmaceuticals Industries LTD
UPJ Upjohn Company
WLA Warner-Lambert Company
A registration statement relating to the units of this
Series will be filed with the Securities and Exchange Commission
but has not yet become effective. Information contained herein
is subject to completion or amendment. Such Units may not be
sold nor may offer to buy be accepted prior to the time the
registration statement becomes effective. This Prospectus shall
not constitute an offer to sell or the solicitation of an offer
to buy nor shall there be any sale of the Units in any state in
which such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any
such state.
Pharmaceutical Growth & Treasury Securities Trust, Series 1
Growth & Value Trust, Pharmaceutical Series 1
The First Trust Special Situations Trust, Series 67 consists of
the underlying separate unit investment trusts set forth above.
The various trusts are sometimes collectively referred to herein
as the "Trusts." The Pharmaceutical Growth & Treasury Securities
Trust, Series 1 is sometimes individually referred to herein as
the "Growth & Treasury Trust." The Growth & Value Trust, Pharmaceutical
Series 1 is sometimes individually referred to herein as the "Growth
Trust."
The Growth & Treasury Trust consists of "zero coupon" U.S. Treasury
bonds and common stocks (the Growth Trust consists only of common
stocks) of pharmaceutical companies, including common stocks of
foreign issuers in American Depositary Receipt ("ADR") form, which
are considered, in the view of the Sponsor, to be undervalued
at the Initial Date of Deposit. See "What are Equity Securities?"
The objective of the Growth & Treasury Trust is to protect Unit
holders' capital and provide income and potential capital appreciation
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 pharmaceutical companies
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 value 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.
The objective of the Growth Trust is to provide income and potential
capital appreciation by investing the Trust's portfolio in common
stocks issued by pharmaceutical companies 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.
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 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. 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 August 15, 2004
(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
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
The date of this Prospectus is April 14, 1993, as amended on
November 29, 1993
Page 1
(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 & Treasury Trust, the Sponsor may,
from time to time during a period of up to approximately 180 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?"
With respect to the Growth Trust, the Sponsor may, from time to
time during a period of up to approximately 180 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?"
Public Offering Price. 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 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).
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 reduction beginning June 1, 1994.
The minimum purchase for each Trust is $1,000. The sales charge
is reduced on a graduated scale for sales involving at least 10,000
Units with respect to the Growth & Treasury Trust and 5,000 Units
with respect to the Growth Trust. See "How is the Public Offering
Price Determined?"
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
Page 2
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
AMORTIZATION 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 & 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,
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. 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 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 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. In the case of the Growth Trust, if a secondary
market is not maintained, a Unit holder 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. 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 Treasury Obligations Maturity Date
for the Growth & Treasury Trust and on the Mandatory Termination
Date for the Growth 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 Treasury Obligations Maturity Date for the Growth
& Treasury Trust and at least 60 days prior to the Mandatory Termination
Date for the Growth 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 Treasury
Obligations Maturity Date for the Growth & Treasury Trust, and
at least five business days prior to the Mandatory Termination
Date for the Growth 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?"
Page 3
Summary of Essential Information
At the Opening of Business on the Initial Date of Deposit
of the Securities-April 14, 1993
Sponsor: Nike Securities L.P.
Trustee: United States Trust Company of New York
Evaluator: Securities Evaluation Service, Inc.
<TABLE>
<CAPTION>
Pharmaceutical
Growth & Treasury
Securities Trust,
Series 1
_________________
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) $ 458,113
Aggregate Offering Price Evaluation of Securities per 100 Units $ 916.23
Sales Charge (2) $ 53.33
Public Offering Price per 100 Units (3) $ 969.56
Sponsor's Initial Repurchase Price per 100 Units $ 916.23
Redemption Price per 100 Units (4) $ 912.01
</TABLE>
CUSIP Number 33734W 103
First Settlement Date April 21, 1993
Treasury Obligations Maturity Date August 15, 2004
Mandatory Termination Date August 15, 2004
Trustee's Annual Fee $.84 per 100 Units outstanding.
Evaluator's Annual Fee $.30 per 100 Units outstanding.
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 Maximum of $.25 per 100 Units outstand-
ing annually payable to an affiliate of
the Sponsor.
Income Distribution Record Date Fifteenth day of each June and
December commencing June 15, 1993.
Income Distribution Date (5) Last day of each June and December
commencing June 30, 1993.
[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 100
Units (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 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 100 Units (based on bid price evaluation
of underlying Treasury Obligations and aggregate underlying value
of Equity Securities) is $57.55 less than the Public Offering
Price per 100 Units and $4.22 less than Sponsor's Initial Repurchase
Price per 100 Units. See "How May Units be Redeemed?"
(5) 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 $1.00 per 100 Units. Notwithstanding,
distributions of funds in the Capital Account, if any, will be
made in December of each year.
Page 4
Summary of Essential Information
At the Opening of Business on the Initial Date of Deposit
of the Securities-April 14, 1993
Sponsor: Nike Securities L.P.
Trustee: United States Trust Company of New York
Evaluator: Securities Evaluation Service, Inc.
<TABLE>
<CAPTION>
Growth
& Value Trust,
Pharmaceutical
Series 1
________________
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) $ 474,979
Aggregate Offering Price Evaluation per 100 Units $ 949.96
Sales Charge (2) $ 48.95
Public Offering Price per 100 Units (3) $ 998.91
Sponsor's Initial Repurchase Price per 100 Units $ 949.96
Redemption Price per 100 Units (4) $ 949.96
</TABLE>
CUSIP Number 33734T 886
First Settlement Date April 21, 1993
Mandatory Termination Date May 1, 2000
Discretionary Liquidation Amount A 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 a
Trust during the primary offering
period.
Trustee's Annual Fee $.84 per 100 Units outstanding.
Evaluator's Annual Fee $.30 per 100 Units outstanding.
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 Maximum of $.25 per 100 Units outstand-
ing annually payable to an affiliate of
the Sponsor.
Income Distribution Record Date Fifteenth day of each March, June,
September and December commencing
June 15, 1993.
Income Distribution Date (5) Last day of each March, June, September
and December commencing June 30, 1993.
[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 100
Units (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.
(4) Redemption price per 100 Units (based on the aggregate underlying
value of Equity Securities) is $48.95 less than Public Offering
Price per 100 Units. See "How May Units be Redeemed?"
(5) 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 $1.00 per 100 Units. Notwithstanding,
distributions of funds in the Capital Account, if any, will be
made in December of each year.
Page 5
Pharmaceutical Growth & Treasury Securities Trust, Series 1
Growth & Value Trust, Pharmaceutical Series 1
The First Trust Special Situations Trust, Series 67
What is The First Trust Special Situations Trust?
The First Trust Special Situations Trust, Series 67 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: Pharmaceutical
Growth & Treasury Securities Trust, Series 1, and Growth & Value
Trust, Pharmaceutical Series 1 (collectively, the "Trusts" and
each, individually, a "Trust"). The Pharmaceutical Growth & Treasury
Securities Trust, Series 1 is sometimes individually referred
to herein as the "Growth & Treasury Trust." The Growth & Value
Trust, Pharmaceutical Series 1 is sometimes individually referred
to herein as the "Growth 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, Securities Evaluation Service, Inc., as Evaluator,
and Nike Financial Advisory Services L.P., as Portfolio Supervisor.
The Pharmaceutical Growth & Treasury Securities Trust, Series
1 consists of a portfolio containing "zero coupon" bonds and common
stocks issued by pharmaceutical companies, including common stock
of foreign issuers in American Depositary Receipt form. See "What
are Equity Securities?" The Growth & Value Trust, Pharmaceutical
Series 1 consists of a portfolio containing only common stocks
issued by pharmaceutical companies, including common stock of
foreign issuers in American Depositary Receipt 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 & Treasury Trust is to protect Unit
holders' capital and provide income and potential capital appreciation
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 pharmaceutical companies
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.
The objective of the Growth Trust is to provide income and potential
capital appreciation by investing the Trust's portfolio in common
stocks issued by pharmaceutical companies 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.
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. With respect to
the Growth Trust, with the deposit of Equity Securities
Page 6
on the Initial Date of Deposit, the Sponsor established a percentage
relationship between the amounts of 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 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. 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. 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 Pharmaceutical
Growth & Treasury Securities Trust, Series 1, the original percentage
relationship on the Initial Date of Deposit was approximately
52.67% Treasury Obligations and approximately 47.33% 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 Treasury Obligations and Equity
Securities in the Growth & Treasury Trust will fluctuate daily,
the ratio, on a market value basis, will also change daily. Likewise,
the prices of the underlying Equity Securities in the Growth Trust
will fluctuate daily and the ratio, on a market value basis,will
also change daily. The maturity value of the Treasury Obligations
and the portion of Equity Securities represented by each Unit
of the Growth & Treasury Trust will not change as a result of
the deposit of additional Securities in the Growth & Treasury
Trust. 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.
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 $4.83 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$5.68 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 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
Page 7
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 Trusts, the Sponsor has borne all the expenses
of creating and establishing the Trusts, including the cost of
the initial preparation, printing and execution of the Indenture
and the certificates for the Units, legal and accounting expenses,
expenses of the Trustee and other out-of-pocket expenses. The
Sponsor will not receive any fees in connection with its activities
relating to the Trusts. However, Nike Financial Advisory Services
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 each Trust. Such fee is based on the number of Units
outstanding in a 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 a Trust, 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 Nike Financial Advisory Services L.P. of supplying such
services in such year.
Subsequent to the initial offering period, the Evaluator will
receive a fee as indicated in the "Summary of Essential Information."
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 $.84
per annum per 100 Units in each Trust outstanding based upon the
largest aggregate number of Units of the 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 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?"
Page 8
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 $.50 per 100 Units.
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 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 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
Page 9
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. 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. 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). 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. Accordingly, Unit
holders should consult their tax advisers in this regard.
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%. 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.
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
Page 10
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.
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, certain of which are briefly described below.
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 10 year averaging or tax-deferred rollover
treatment. The Code
Page 11
substitutes 5 year averaging for 10 year averaging for qualifying
lump sum plan distributions after December 31, 1986 although certain
transition rules apply which retain 10 year averaging for qualifying
recipients who attained age 50 before January 1, 1986. Moreover,
the Code contains provisions which adversely affect the continued
deductibility of annual contributions to an IRA beginning in 1987.
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.
Individual Retirement Account-IRA. The deductible amount an individual
may contribute will be reduced to the extent an individual has
adjusted gross income over $25,000 ($40,000 if married, filing
jointly or $0 if married, living apart and filing separately),
if either an individual or that individual's spouse (if married,
filing jointly) is an active participant in an employer maintained
retirement plan. If an individual has adjusted gross income over
$35,000 ($50,000 if married, filing jointly or $0 if married,
living apart and filing separately), and if an individual or that
individual's spouse is an active participant in an employer maintained
retirement plan, no IRA deduction is permitted. Under the Code,
an individual may make nondeductible contributions to the extent
deductible contributions are not allowed. The combined deductible
and nondeductible limit for an individual under the Code is the
lesser of $2,000 ($2,250 in the case of a spousal IRA) or 100
percent of compensation. Generally, the Federal income tax relating
to capital gains and income received in an IRA is deferred until
distributions are received. Distributions from an IRA (other than
the return of certain excess contributions) are treated as ordinary
income, except that under the Code an individual need not pay
tax on the return of nondeductible contributions. The Code provides
that if amounts are withdrawn from an IRA which includes both
deductible and nondeductible contributions, the amount excludable
from income for the taxable year is the same proportion to the
total amount withdrawn for the taxable year that the individual's
aggregate nondeductible IRA contributions bear to the aggregate
balance of all IRAs of the individual.
It should be noted that certain transactions which are prohibited
under the Code will cause all or a portion of the amount in an
IRA to be deemed to be distributed and subject to tax at that
time. A participant's entire interest in an IRA must be, or commence
to be, distributed to the participant not later than April 1 of
the calendar year following the year during which the individual
attains age 70 1/2. Excess contributions are subject to an annual
6% excise tax. Distributions made before attainment of age 59
1/2, except in the case of the participant's death or disability,
separation from service after attaining age 55, qualified domestic
relations orders or distributions applied to certain medical expenses
or where the amount distributed is to be rolled over to another
IRA, or if distributions are in a form of substantially equal
periodic payments over the life or life expectancy of the individual,
or over the joint lives of the individual and the individual's
beneficiary, are generally subject to a surtax in an amount equal
to 10% of the taxable portion of the distribution.
Retirement Plans for the Self-Employed-Keogh Plans. Units of a
Trust may be purchased by retirement plans established pursuant
to the Self-Employed Individuals Tax Retirement Act of 1962 ("Keogh
Plans"). Such plans are available for self-employed individuals,
partnerships or unincorporated companies. Under existing law,
qualified individuals may generally make annual tax-deductible
contributions to a defined contribution Keogh Plan of up to the
lesser of 25% of annual compensation (less the Keogh Plan contribution)
or $30,000 for taxable years beginning after December 31, 1983.
A defined benefit Keogh Plan is limited to providing benefits
each year which do not exceed the lesser of $90,000 (as adjusted
for inflation) or 100% of average compensation for the highest
three consecutive calendar years. The assets of the Keogh Plans
must be held in a qualified trust or other arrangement which meets
the requirements of the Code. Generally, a participant's entire
interest in a Keogh Plan must be, or commence to be, distributed
to the participant not later than April 1 of the calendar year
following the year during which the individual attains age 70
1/2. Excess contributions to a Keogh Plan are subject to an annual
10% excise tax. Distributions made before attainment of age 59
1/2, except in the case of the participant's death or disability,
separation from service after attaining age 55, qualified domestic
relations orders or distributions applied to certain medical expenses
or where the amount distributed is to be rolled over to an IRA
or another qualified plan, or if distributions are in a form of
substantially equal periodic payments over the life or life expectancy
of the individual,
Page 12
or over the joint lives of the individual and the individual's
beneficiary, are generally subject to a surtax in an amount equal
to 10% of the distribution.
Corporate Pension and Profit-Sharing Plans. An employer who has
established a pension or profit-sharing plan for employees may
purchase Units of a Trust for such a plan.
Excess Distributions Tax. In addition to the other taxes due by
reason of a plan distribution, a tax of 15% may apply to certain
aggregate distributions from IRAs, Keogh Plans, and qualified
corporate retirement plans to the extent such aggregate taxable
distributions exceed specified amounts (generally $150,000, as
adjusted or $112,500, as adjusted, if the recipient has made a
"grandfather election") during the tax year. This 15% tax will
not apply to distributions on account of death, qualified domestic
relations orders or amounts eligible for tax-deferred rollover
treatment. In general, for qualifying lump sum distributions the
excess distribution over $750,000, as adjusted, or $562,000, as
adjusted, if the recipient has made a "grandfather election,"
will be subject to the 15% tax.
Excess Accumulations Tax. On the participant's death, a 15% tax
will be imposed on aggregate balances remaining in IRAs, Keogh
Plans and qualified corporate retirement plans to the extent those
balances exceed specified levels. If a spouse is the death beneficiary
of all balances, the imposition of the tax may be postponed until
the spouse's death unless such spouse receives excess distributions
during the spouse's life. In such a case, the spouse will be treated
as the participant and will be liable for the 15% tax on excess
distributions, as described above.
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 pharmaceutical companies and are listed
on a national securities exchange or the NASDAQ National Market
System or are 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.
An investment in Units of a Trust should be made with an understanding
of the characteristics of the pharmaceuticals industry and the
risks which such investment may entail. Pharmaceutical companies
are companies involved in drug development and production services.
Pharmaceutical companies have potential risks unique to their
sector of the health care field. Such companies are subject to
governmental regulation of their products and services, a factor
which could have a significant and possibly unfavorable effect
on the price and availability of such products or services. Furthermore,
pharmaceutical companies face the risk of increasing competition
from generic drug sales, the termination of their patent protection
for drug products and the risk that technological advances will
render their products or services obsolete. The research and development
costs of bringing a drug to market are substantial and include
lengthy governmental review processes, with no guarantee that
the product will ever come to market. Many of these pharmaceutical
companies may have losses and not offer certain products
Page 13
until the late 1990s. Pharmaceutical companies may also have persistent
losses during a new product's transition from development to production,
and revenue patterns may be erratic.
The medical sector has historically provided investors with significant
growth opportunities. One of the industries included in the sector
is pharmaceutical companies. Pharmaceutical companies develop,
manufacture and sell prescription and over-the-counter drugs.
In addition, they are well known for the vast amounts of money
they spend on world-class research and development. In short,
pharmaceutical companies work to improve the quality of life for
millions of people and are vital to the nation's health and well-being.
As the population of the United States ages, the companies involved
in the pharmaceutical field will continue to search for and develop
new drugs through advanced technologies and diagnostics. On a
worldwide basis, pharmaceutical companies are involved in the
development and distributions of drugs and vaccines. These activities
may make the pharmaceutical sector very attractive for investors
seeking the potential for growth in their investment portfolio.
However, there are no assurances that the Trusts' objectives will
be met.
Legislative proposals concerning health care are under consideration
by the Clinton Administration. These proposals span a wide range
of topics, including cost and price controls (which might include
a freeze on the prices of prescription drugs), national health
insurance, incentives for competition in the provision of health
care services, tax incentives and penalties related to health
care insurance premiums and promotion of pre-paid health care
plans. The Sponsor is unable to predict the effect of any of these
proposals, if enacted, on the issuers of Equity Securities in
the Trust.
The Trusts consist of such of the Securities listed under "Schedule
of Investments" for each Trust as may continue to be held from
time to time in each Trust and any additional Securities acquired
and held by such Trust 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 Securities. However, should any
contract for the purchase of any of the Securities initially deposited
hereunder fail, the Sponsor will, unless substantially all of
the moneys held in such Trust to cover such purchase are reinvested
in substitute Securities in accordance with the Trust Agreement,
refund the cash and sales charge attributable to such failed contract
to all Unit holders on the next distribution date.
Because certain of the Equity Securities from time to time may
be sold under certain circumstances described herein, and because
the proceeds from such events will 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.
In certain circumstances involving mergers or other similar transactions,
the Trustee is required to sell Equity Securities. Pursuant to
the Indenture and with limited exceptions, the Trustee must sell
any securities or other property acquired in exchange for Equity
Securities such as those acquired in connection with a merger
or other transaction. The Sponsor has requested rulings from the
Internal Revenue Service which, if obtained, would allow the Trustee
to retain in a Trust securities and other property acquired in
connection with such mergers or other transactions. 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.
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. 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.
The securities of 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. ADRs may be
sponsored or unsponsored. In an unsponsored facility, the depositary
initiates and arranges the facility at the request
Page 14
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.
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. In addition, the rights of holders of ADRs
may be different than those of holders of the underlying shares,
and the market for ADRs may be less liquid than that for the underlying
shares. ADRs are registered securities pursuant to the Securities
Act of 1933 and may be subject to the reporting requirements of
the Securities Exchange Act of 1934.
On the basis of the best information available to the Sponsor
at the present time, none of the Equity Securities are subject
to exchange control restrictions under existing law which would
materially interfere with payment to the Trusts of dividends due
on, or proceeds from the sale of, the Equity Securities either
because the particular jurisdictions have not adopted any currency
regulations of this type or because the issues qualify for an
exemption, or the Trust, as an extraterritorial investor, has
qualified its purchase of the Equity Securities as exempt by following
applicable "validation" or similar regulatory or exemptive procedures.
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 their obligation
to redeem Units tendered to the Trustee for redemption.
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.
Page 15
Whether or not the Equity Securities are listed on a national
securities exchange, the principal trading market for the Equity
Securities may be in the over-the-counter market. As a result,
the existence of a liquid trading market for the Equity Securities
may depend on whether dealers will make a market in the Equity
Securities. There can be no assurance that a market will be made
for any of the Equity Securities, that any market for the Equity
Securities will be maintained or of the liquidity of the Equity
Securities in any markets made. The recent investigation by the
Securities and Exchange Commission of illegal insider trading
in connection with corporate takeovers, and possible congressional
inquiries and legislation relating to this investigation, may
adversely affect the ability of certain dealers to remain market
makers. 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 Pharmaceutical Growth
& Treasury Securities Trust, Series 1 and Growth & Value Trust,
Pharmaceutical Series 1?
Issuers of Equity Securities selected for inclusion in these Portfolios
are as follows:
American Home Products Corporation, headquartered in New York,
New York, manufactures and markets health care products, including
pharmaceuticals, consumer health care products, medical supplies
and diagnostic products. The company also manufactures specialty
foods and candies.
Bristol-Myers Squibb Company, headquartered in New York, New York,
researches, develops, manufactures and markets prescription and
non-prescription drugs, medical devices, health and skin care
products and beauty aids. Bristol-Myers Squibb's line of prescription
drugs is comprised primarily of cardiovascular drugs and antibiotics.
Glaxo Holdings PLC (ADR) is a holding company for pharmaceutical
manufacturers. Headquartered in London, England, the company ranks
as one of the largest drug companies in Great Britain. In the
United States, Glaxo, Inc. (a subsidiary of Glaxo Holdings PLC)
researches, develops and manufactures prescription medicines that
treat gastrointestinal, respiratory, infectious and cardiovascular
diseases. The company markets its products worldwide.
Johnson & Johnson, headquartered in New Brunswick, New Jersey,
manufactures and sells a broad range of products in the health
care and other fields. The company's business is divided into
the consumer, professional and pharmaceutical segments. Products
include contraceptives, therapeutics, veterinary products, dental
products, surgical instruments, dressings and apparel and nonprescription
drugs.
Lilly (Eli) & Company develops, manufactures and markets pharmaceuticals,
medical instruments, diagnostic products and agricultural chemicals.
Headquartered in Indianapolis, Indiana, the company markets its
products in numerous countries.
Marion Merrill Dow, Inc. is a leading pharmaceutical company headquartered
in Kansas City, Missouri. The company researches, develops, manufactures
and sells prescription and over-the-counter pharmaceutical products.
Merck & Company, Inc., based in Rahway, New Jersey, is a leading
manufacturer of human and animal health care products and specialty
chemical products. The company's product line includes anti-hypertensive,
cardiovasculars, anti-inflammatories and glaucoma treatments.
Animal health care and specialty chemical products include preventative
medicine for poultry disease and water treatment chemicals, respectively.
Pfizer, Inc., headquartered in New York, New York, produces ethical
drugs, hospital products, animal health items, specialty chemicals,
consumer products and mineral based material science products.
The company uses the consumer brand names "Ben-Gay," "Visine,"
"Desitin," "Coty" and "Plax."
Rhone-Poulenc Rorer, Inc., located in Collegeville, Pennsylvania,
develops, manufactures and markets prescription and over-the-counter
pharmaceuticals in the United States and abroad. The company's
operations
Page 16
involve the production and sale of pharmaceuticals, primarily
gastrointestinal, cardiovascular, bone metabolism, dermatological,
respiratory and plasma derivative products.
Schering-Plough, headquartered in Madison, New Jersey, is a world-wide
manufacturer of prescription and over-the-counter drugs, animal
health products and a variety of consumer products including cosmetics,
sun care and foot care lines. Popular brand names include "Afrin,"
"Scholl's" and "Coppertone."
SmithKline Beecham PLC (ADR), located in Brentford, Middlesex,
UK, researches, develops, manufactures and markets a broad line
of pharmaceutical products for human and animal use. The company
also makes over-the-counter medicines and health-orientated consumer
products. These products include "Contact," "Massengill," "Tums"
and "Aquafresh."
Upjohn Company, based in Kalamazoo, MIchigan, manufactures pharmaceuticals.
The company's products include prescription drugs such as steroids,
antibiotics, oral antidiabetes drugs, topical treatments for baldness
and sex hormones.
Warner-Lambert Company, headquartered in Morris Plains, New Jersey,
manufactures pharmaceutical consumer healthcare and confectionery
products under such brand names as "Certs," "Listerine," "Rolaids,"
"Halls" and "Schick."
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 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.
Page 17
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 & 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 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 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 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) divided by the number of
outstanding Units of such Trust.
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 June 1, 1994, divided by the number
of outstanding Units of the Trust.
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:
Page 18
<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>
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>
For secondary market transactions, a dealer will receive from
the Sponsor a dealer concession of 70% of the total sales charges
for Units sold.
Any such reduced sales charge shall be the responsibility of the
selling underwriter or dealer. The reduced sales charge structure
will apply on all purchases of Units in a Trust by the same person
on any one day from any one underwriter or 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 Underwriter or 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 and the Underwriters 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 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 therefore is other than
on the exchange, the evaluation shall generally be based on the
current ask price
Page 19
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. 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
180 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 & 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. 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. Effective on each June 1, commencing June 1, 1994, the
sales charge of the Growth Trust will be reduced by 1/2 of 1%
to a minimum sales charge of 3.0%. 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. The
Sponsor reserves the right to change the amount of the concession
or agency commission from time to time. Certain commercial banks
may be making Units of the Trusts available to their customers
on an agency basis. A portion of the sales charge paid by these
customers is retained by or remitted to the banks in the amounts
indicated in the second preceding sentence. 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. With respect
to the Growth & Treasury Trust, any broker/dealer or bank will
receive additional concessions for purchases made from the Sponsor
on the Date of Deposit resulting in total concessions as contained
in the following table:
Page 20
Total Concessions (Per Unit)*
_____________________________
$250,000-499,999 $500,000-999,999 $1,000,000 or more
Purchased Purchased Purchased
________________ ________________ __________________
3.7% 3.8% 4.0%
* The applicable concession will be allotted to broker/dealers
or banks who purchase Units from the Sponsor only on the Initial
Date of Deposit of a given Trust.
With respect to the Growth Trust, any broker/dealer or bank will
receive additional concessions for purchases made from the Sponsor
on the Date of Deposit resulting in total concessions as contained
in the following table:
Total Concessions (Per Unit)*
_____________________________
$250,000-499,999 $500,000-999,999 $1,000,000 or more
Purchased Purchased Purchased
________________ ________________ __________________
3.3% 3.4% 3.6%
* The applicable concession will be allotted to broker/dealers
or banks who purchase Units from the Sponsor only on the Initial
Date of Deposit of a given Trust.
What are the Sponsor's Profits?
With respect to the Growth & Treasury Trust, the Underwriters
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), less any reduced sales charge for
quantity purchases. With respect to the Growth Trust, the Underwriters
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), less any reduced sales charge for
quantity purchases as described under "Public Offering-How is
the Public Offering Price Determined?" See "Underwriting" for
information regarding the receipt of the excess gross sales commissions
by the Sponsor from the other Underwriters and additional concessions
available to Underwriters, dealers and others. In addition, the
Sponsor and the Underwriters 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
the Trusts (which is based on the Evaluator's determination of
the aggregate offering price of the underlying Securities of each
Trust on the Initial Date of Deposit as well as on subsequent
deposits) and the cost of such Securities to the Sponsor. See
"Underwriting" and Note (2) of "Schedules of Investments." During
the initial offering period, the Underwriter also may realize
profits or sustain losses as a result of fluctuations after the
Date of Deposit in the Public Offering Price received by the Underwriter
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 5.5%
with respect to the Growth & Treasury Trust and 4.9%, subject
to reduction beginning June 1, 1994, with respect to the Growth
Trust) 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, and the Underwriters may, 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.
Page 21
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 an officer
of a commercial bank or trust company, a member firm of either
the New York, American, Midwest or Pacific Stock Exchange, or
in such other manner as may be acceptable to 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 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 $1.00 per 100 Units. 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
Page 22
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 Treasury Obligations Maturity Date for the Growth & Treasury
Trust and not less than 60 days prior to the Mandatory Termination
Date for the Growth 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 Treasury Obligations Maturity
Date for the Growth & Treasury Trust and at least five business
days prior to the Mandatory Termination Date for the Growth Trust.
Not less than 60 days prior to the termination of a Trust, those
Unit holders 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 100 Units. 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 100 Units 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
Page 23
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 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 and the Public Offering Price per
Unit (which includes the sales charge) during the initial offering
period (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 OFFERINGprices 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
Page 24
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 therefore is other than
on the exchange, the evaluation shall generally be based on the
current bid price on the over-the-counter market (unless these
prices are inappropriate as a basis for evaluation). If current
bid prices are unavailable, the evaluation is generally determined
(a) on the basis of current bid prices for comparable securities,
(b) by appraising the value of the Equity Securities on the bid
side of the market or (c) by any combination of the above.
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
Page 25
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. Except as stated under "Portfolio-
What are Some Additional Considerations for Investors?" for Failed
Contract Obligations, the acquisition by a Trust of any securities
or other property other than the Securities is prohibited. Pursuant
to the Indenture and with limited exceptions, the Trustee must
sell any securities or other property acquired in exchange for
Equity Securities such as those acquired in connection with a
merger or other transaction. The Sponsor has requested rulings
from the Internal Revenue Service which, if obtained, would allow
the Trustee to retain in a Trust securities and other property
acquired in connection with such mergers or other transactions.
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 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 $7 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 January 31, 1992, the total partners' capital of Nike Securities
L.P. was $12,256,319 (unaudited). (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
Page 26
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 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 Securities Evaluation Service, Inc., 531 East
Roosevelt Road, Suite 200, Wheaton, Illinois 60187. 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.
Page 27
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 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." The Indenture for the
Growth Trust provides that it shall terminate upon 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?"
Commencing on the Treasury Obligations Maturity Date for the
Growth & Treasury Trust and on the Mandatory Termination Date
for the Growth 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 Treasury Obligations Maturity Date for the Growth
& Treasury Trust and 60 days prior to the Mandatory Termination
Date for the Growth 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 Treasury Obligations Maturity Date and at least five business
days prior to the Mandatory Termination Date for the Growth 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,
Page 28
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, 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.
UNDERWRITING
The Underwriters named below, including the Sponsor, have purchased
Units in the following respective amounts:
Pharmaceutical Growth & Treasury Securities Trust, Series 1
<TABLE>
<CAPTION>
Number of
Name Address Units
____ _______ _________
<S> <C> <C>
Sponsor
Nike Securities L.P. 1001 Warrenville Road, Lisle, IL 60532 24,000
Underwriters
Butcher & Singer Inc.* Two Logan Square, 18th & Arch Streets, Philadelphia, PA 19103 10,000
Hazlett, Burt & Watson, Inc.** Paxton House, 1300 Chapline St., Wheeling, WV 26003 5,000
Stifel, Nicolaus 500 North Broadway, 16th Floor, St. Louis, MO 63102 5,000
& Company, Incorporated*
Advest, Inc. One Commercial Plaza, 280 Trumbull Street, 18th Floor, 1,000
Hartford, CT 06103
Dain Bosworth Incorporated Dain Bosworth Plaza, 60 S. 6th Street, 14th Floor, 1,000
Minneapolis, MN 55402-4422
Gibraltar Securities Co. Ten James Street, Florham Park, NJ 07932 1,000
Gruntal & Co., Incorporated 14 Wall Street, 14th Floor, New York, NY 10005 1,000
John G. Kinnard 1700 Northstar West, Minneapolis, MN 55402-9963 1,000
& Co., Incorporated
Rauscher Pierce Refsnes, Inc. Plaza of the Americas, 2400 Rauscher Pierce Refsnes Tower, 1,000
Dallas, TX 75201 ______
50,000
======
</TABLE>
[FN]
* These Underwriters have commited to purchase at least 50,000
Units from the Sponsor on the Initial Date of Deposit and have
indicated their intention to purchase a total of 100,00 Units
from the Sponsor during the initial six month offering period.
** The Underwriters have commited to purchase at least 25,000
Units from the Sponsor on the Initial Date of Deposit and have
indicated their intention to purchase a total of 50,000 Units
from the Sponsor during the initial six month offering period.
Page 29
In addition to those Underwriters set forth above for the Growth
& Treasury Trust as having committed to purchase Units subsequent
to the Initial Date of Deposit, the Underwriters named below have
severally purchased Units of the Growth & Treasury Trust subsequent
to the Initial Date of Deposit in the following respective amounts:
<TABLE>
<CAPTION>
Name Address Units
____ _______ ______
<S> <C> <C>
Underwriters
Advest, Inc. One Commercial Plaza, 280 Trumbull Street, 18th Floor, 25,000
Hartford, CT 06103
Gruntal & Co., Incorporated* 14 Wall Street, 14th Floor, New York, NY 10005 25,000
Hamilton Investments* 2 North LaSalle Street, Chicago, IL 60602 25,000
Legg Mason Wood Walker, Inc.* 111 South Calvert Street, Baltimore, MD 21203-1476 25,000
The Principal/Eppler, Guerin & Fountain Place, 1445 Ross Avenue, Suite 2300, 25,000
Turner, Inc. Dallas, TX 75202-2786
Rauscher Pierce Refsnes, Inc. Plaza of the Americas, 2400 Rauscher Pierce Refsnes Tower, 25,000
Dallas, TX 75201
Sutro & Co. Incorporated* 350 Sansome Street, San Francisco, CA 94111 25,000
B.C. Christopher Division 4717 Grand Ave., Suite 700, Kansas City, MO 64112 10,000
of Fanstock Inc.
Morgan Keegan & Morgan Keegan Tower, 50 Front Street, Memphis, TN 38103 10,000
Company, Incorporated
Scott & Stringfellow, Inc. 909 East Main Street, Richmond, VA 23219 10,000
</TABLE>
[FN]
* These Underwriters have committed to purchase a minimum of
25,000 Units from the Sponsor and have indicated their intentions
to purchase additional Units during the initial offering period
to qualify as an Underwriter (50,000 Units in total) and will
receive the concession indicated following the list of Underwriters.
Growth & Value Trust, Pharmaceutical Series 1
<TABLE>
<CAPTION>
Number of
Name Address Units
____ _______ _________
<S> <C> <C>
Sponsor
Nike Securities L.P. 1001 Warrenville Road, Lisle, IL 60532 26,500
Underwriters
Robert W. Baird & Co. Incorporated First Wisconsin Center, 777 East Wisconsin Avenue, 5,000
Milwaukee, WI 53202
Dain Bosworth Incorporated Dain Bosworth Plaza, 60 S. 6th Street, 14th Floor, 5,000
Minneapolis, MN 55402-4422
John G. Kinnard 1700 Northstar West, Minneapolis, MN 55402-9963 5,000
& Co., Incorporated
Rauscher Pierce Refsnes, Inc. Plaza of the Americas, 2400 Rauscher Pierce Refsnes Tower, 2,500
Dallas, TX 75201
Advest, Inc. One Commercial Plaza, 280 Trumbull Street, 18th Floor, 1,000
Hartford, CT 06103
Gibraltar Securities Co. Ten James Street, Florham Park, NJ 07932 1,000
Gruntal & Co., Incorporated 14 Wall Street, 14th Floor, New York, NY 10005 1,000
Hazlett, Burt & Watson, Inc. Paxton House, 1300 Chapline St., Wheeling , WV 26003 1,000
Kemper Securities, Inc. 77 West Wacker Drive, 28th Floor, Chicago, IL 60601 1,000
Legg Mason Wood Walker, Inc. 111 South Calvert Street, Baltimore, MD 21203-1476 1,000
______
50,000
======
</TABLE>
Page 30
In addition to those Underwriters set forth above for the Growth
Trust as having committed to purchase Units subsequent to the
Initial Date of Deposit, the Underwriters named below have severally
purchased Units of the Growth Trust subsequent to the Initial
Date of Deposit in the following respective amounts:
<TABLE>
<CAPTION>
Name Address Units
____ _______ ______
<S> <C> <C>
Underwriters
Gruntal & Co., Incorporated 14 Wall Street, 14th Floor, New York, NY 10005 125,000
John G. Kinnard 1700 Northstar West, Minneapolis, MN 55402-9963 100,000
& Co., Incorporated
Stifel, Nicolaus 500 North Broadway, 16th Floor, St. Louis, MO 63102 100,000
& Company, Incorporated
J.C. Bradford & Co. 330 Commerce Street, Nashville, TN 37201-1809 50,000
Advest, Inc. One Commercial Plaza, 280 Trumbull Street, 18th Floor, 25,000
Hartford, CT 06103
City Securities Corporation 135 North Pennsylvania Street, Suite 2200, 25,000
Indianapolis, IN 46204
First Montauk Securities Corp. 328 Newman Springs Road, Parkway 109 Office Center, 25,000
Red Bank, New Jersey 07701
Hamilton Investments 2 North LaSalle Street, Chicago, IL 60602 25,000
Legg Mason Wood Walker, Inc. 111 South Calvert Street, Baltimore, MD 21203-1476 25,000
Southwest Securities Inc. 1201 Elm Street, Suite 4300, Dallas, TX 75270 25,000
B.C. Christopher Division 4717 Grand Ave., Suite 700, Kansas City, MO 64112 10,000
of Fanstock Inc.
First of Michigan Corporation 100 Renaissance Center, 26th Floor, Detroit, MI 48243 10,000
</TABLE>
With respect to the Growth & Treasury Trust, the Underwriters
have agreed to underwrite additional Units of the Trust as they
become available. The Sponsor will receive from the Underwriters
the excess over the gross sales commission contained in the following
table:
Underwriting Concessions
________________________
$100,000-499,999 $500,000-999,999 $1,000,000 or more
Underwritten Underwritten Underwritten
_________________ ________________ __________________
3.7% 3.9% 4.1%
With respect to the Growth Trust, the Underwriters have agreed
to underwrite additional Units of the Trust as they become available.
The Sponsor will receive from the Underwriters the excess over
the gross sales commission contained in the following table:
Underwriting Concessions
________________________
$100,000-249,999 $250,000-499,999 $500,000-999,999 $1,000,000 or more
Underwritten Underwritten Underwritten Underwritten
________________ ________________ ________________ __________________
3.3% 3.4% 3.6% 3.7%
On the Initial Date of Deposit, the Underwriters of the Trusts
became the owners of the Units of each Trust and entitled to the
benefits thereof, as well as the risks inherent therein.
The Agreement among Underwriters provides that a public offering
of the Units of the Trusts will be made at the Public Offering
Price described in the prospectus. Units may also be sold to or
through dealers and others during the initial offering period
and in the secondary market at prices representing a concession
or agency commission as described in "Public Offering-How are
Units Distributed?"
Underwriters, 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
Page 31
Trust Special Situations Trust, Templeton Growth and Treasury
Trust, Templeton Foreign Fund & U.S. Treasury Securities Trust,
The Advantage Growth and Treasury Securities 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 $ .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
Underwriters and dealers of the Trusts 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 an Underwriter or
dealer may be eligible to win other nominal awards for certain
sales efforts, or under which the Sponsor will reallow to any
such Underwriter or 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 Underwriters or dealers for certain services
or activities which are primarily intended to result in sales
of Units of the Trusts. Such payments are made by the Sponsor
out of its own assets, and not out of the assets of the Trusts.
These programs will not change the price Unit holders pay for
their Units or the amount that the Trusts 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 the Trusts
and returns over specified periods on other similar Trusts sponsored
by Nike Securities L.P. with returns on 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 the Trusts are
described more fully elsewhere in this Prospectus.
Page 32
REPORT OF INDEPENDENT AUDITORS
The Sponsor, Nike Securities L.P., and Unit Holders
THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 67
We have audited the accompanying statements of net assets, including
the schedules of investments, of Pharmaceutical Growth & Treasury
Securities Trust, Series 1 and Growth & Value Trust, Pharmaceutical
Series 1, comprising The First Trust Special Situations Trust,
Series 67 as of the opening of business on April 14, 1993. 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 April 14, 1993. 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 Pharmaceutical Growth & Treasury Securities Trust, Series 1
and Growth & Value Trust, Pharmaceutical Series 1, comprising
The First Trust Special Situations Trust, Series 67 at the opening
of business on April 14, 1993 in conformity with generally accepted
accounting principles.
ERNST & YOUNG
Chicago, Illinois
April 14, 1993
Page 33
Statements of Net Assets
At the Opening of Business on the Initial Date of Deposit
of the Securities-April 14, 1993
<TABLE>
<CAPTION>
Pharmaceutical
Growth & Treasury
Securities Trust,
Series 1
_________________
NET ASSETS
<S> <C>
Investment in Securities represented
by purchase contracts (1)(2) $ 458,113
===========
Units outstanding 50,000
===========
</TABLE>
<TABLE>
<CAPTION>
ANALYSIS OF NET ASSETS
<S> <C>
Cost to investors (3) $ 484,776
Less sales charge (3) (26,663)
___________
Net Assets $ 458,113
===========
</TABLE>
[FN]
NOTES TO STATEMENTS OF NET ASSETS
(1) Aggregate cost of the Securities listed under "Schedule of
Investments" for Pharmaceutical Growth & Treasury Securities Trust,
Series 1 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 by Bankers
Trust Company has been deposited with the Trustee covering the
monies necessary for the purchase of the Securities in the Pharmaceutical
Growth & Treasury Securities Trust, Series 1 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
Statements of Net Assets
At the Opening of Business on the Initial Date of Deposit
of the Securities-April 14, 1993
<TABLE>
<CAPTION>
Growth
& Value Trust,
Pharmaceutical
Series 1
_________________
NET ASSETS
<S> <C>
Investment in Equity Securities represented
by purchase contracts (1)(2) $ 474,979
============
Units outstanding 50,000
============
</TABLE>
<TABLE>
<CAPTION>
ANALYSIS OF NET ASSETS
<S> <C>
Cost to investors (3) $ 499,452
Less sales charge (3) (24,473)
____________
Net Assets $ 474,979
============
</TABLE>
[FN]
NOTES TO STATEMENTS OF NET ASSETS
(1) Aggregate cost of the Equity Securities listed under "Schedule
of Investments" for Growth & Value Trust, Pharmaceutical Series
1 is based on their aggregate underlying value.
(2) An irrevocable letter of credit totaling $600,000 by Bankers
Trust Company has been deposited with the Trustee covering the
monies necessary for the purchase of the Equity Securities in
Growth & Value Trust, Pharmaceutical Series 1 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 35
Schedule of Investments
Pharmaceutical Growth & Treasury Securities Trust, Series 1
At the Opening of Business on the Initial Date of Deposit
of the Securities-April 14, 1993
<TABLE>
<CAPTION>
Percentage of Market Value
Aggregate per Share of Cost of
Maturity Offering 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 52.67% $241,278
maturing August 15, 2004
Number
of Shares Name of Issuer of Equity Securities (1)
_________ _______________________________________
262 American Home Products Corporation 3.64% $63.625 16,671
287 Bristol-Myers Squibb Company 3.64% 58.125 16,682
982 Glaxo Holdings PLC* 3.64% 17.000 16,694
423 Johnson & Johnson 3.63% 39.375 16,655
365 Lilly (Eli) & Company 3.64% 45.750 16,699
928 Marion Merrell Dow, Inc. 3.62% 17.875 16,588
489 Merck & Company, Inc. 3.62% 33.875 16,565
277 Pfizer, Inc. 3.66% 60.500 16,758
351 Rhone-Poulenc Rorer, Inc. 3.65% 47.625 16,716
277 Schering-Plough 3.64% 60.125 16,655
530 SmithKline Beecham PLC* 3.69% 31.875 16,894
591 Upjohn Company 3.61% 28.000 16,548
240 Warner-Lambert Company 3.65% 69.625 16,710
______ ________
Total Equity Securities 47.33% 16,835
______ ________
Total Investments 100% $458,113
====== ========
</TABLE>
[FN]
Pharmaceutical Growth & Treasury Securities Trust, Series 1
NOTES TO SCHEDULE OF INVESTMENTS
(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 April
13, 1993.
Page 36
(2) The cost of the Securities to the Trust represents the offering
side evaluation as determined by the Evaluator (certain shareholders
of which are officers 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 $456,003. Cost and profit to the Sponsor relating
to the Treasury Obligations sold to the Trust were $238,644 and
$2,634, respectively. Cost and loss to Sponsor relating to the
Equity Securities sold to the Trust were $217,062 and $227, respectively.
* Indicates an American Depositary Receipt. See "What are Equity
Securities?"
Page 37
Schedule of Investments
Growth & Value Trust, Pharmaceutical Series 1
At the Opening of Business on the Initial Date of Deposit
of the Securities-April 14, 1993
<TABLE>
<CAPTION>
Percentage of Cost of
Number Aggregate Offering Market Value Equity Securities
of Shares Name of Issuer of Equity Securities (1) Price per Share to Trust (2)
_________ ________________________________________ _________________ ____________ ________________
<C> <S> <C> <C> <C>
574 American Home Products Corporation 7.69% $63.625 $ 36,521
628 Bristol-Myers Squibb Company 7.68% 58.125 36,503
2,152 Glaxo Holdings PLC* 7.70% 17.000 36,584
926 Johnson & Johnson 7.68% 39.375 36,461
799 Lilly (Eli) & Company 7.70% 45.750 36,554
2,032 Marion Merrell Dow, Inc. 7.65% 17.875 36,322
1,072 Merck & Company, Inc. 7.65% 33.875 36,314
606 Pfizer, Inc. 7.72% 60.500 36,663
770 Rhone-Poulenc Rorer, Inc. 7.72% 47.625 36,671
607 Schering-Plough 7.68% 60.125 36,496
1,161 SmithKline Beecham PLC* 7.79% 31.875 37,007
1,295 Upjohn Company 7.63% 28.000 36,260
526 Warner-Lambert Company 7.71% 69.625 36,623
_____ ________
Total Investments 100% $474,979
====== ========
</TABLE>
[FN]
Growth & Value Trust, Pharmaceutical Series 1
NOTES TO SCHEDULE OF INVESTMENTS
(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 April 13, 1993.
(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, certain shareholders of
which are officers of the Sponsor. The aggregate underlying value
of the Equity Securities on the Initial Date of Deposit was $474,979.
Cost and loss to Sponsor relating to the Equity Securities sold
to the Trust were $475,207 and $228, respectively.
* Indicates an American Depositary Receipt. See "What are Equity
Securities?"
Page 38
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Page 39
<TABLE>
<CAPTION>
CONTENTS:
<S> <C>
Summary of Essential Information:
Pharmaceutical Growth & Treasury Securities Trust,
Series 1 4
Growth & Value Trust, Pharmaceutical Series 1 5
The First Trust Special Situations Trust, Series 67:
What is The First Trust Special Situations Trust? 6
What are the Expenses and Charges? 8
What is the Federal Tax Status of Unit Holders? 9
Why are Investments in the Trusts Suitable for
Retirement Plans? 11
Portfolio:
What are Treasury Obligations? 13
What are Equity Securities? 13
What are the Equity Securities Selected for
Pharmaceutical Growth & Treasury Securities
Trust, Series 1 and Growth & Value Trust,
Pharmaceutical Series 1? 16
What are Some Additional Considerations for
Investors? 17
Public Offering:
How is the Public Offering Price Determined? 18
How are Units Distributed? 20
What are the Sponsor's Profits? 21
Will There be a Secondary Market? 21
Rights of Unit Holders:
How is Evidence of Ownership Issued and Transferred? 22
How are Income and Capital Distributed? 22
What Reports will Unit Holders Receive? 23
How May Units be Redeemed? 23
How May Units be Purchased by the Sponsor? 25
How May Securities be Removed from the Trusts? 25
Information as to Sponsor, Trustee and Evaluator:
Who is the Sponsor? 26
Who is the Trustee? 26
Limitations on Liabilities of Sponsor and Trustee 27
Who is the Evaluator? 27
Other Information:
How May the Indenture be Amended or Terminated? 28
Legal Opinions 28
Experts 29
Underwriting 29
Report of Independent Auditors 33
Statements of Net Assets 34
Schedules of Investments:
Pharmaceutical Growth & Treasury Securities
Trust, Series 1 36
Growth & Value Trust, Pharmaceutical Series 1 38
</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
Pharmaceutical Growth & Treasury Securities Trust
Series 1
Growth & Value Trust,
Pharmaceutical Series 1
First Trust
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
April 14, 1993, as amended on November 29, 1993
Page 40
MEMORANDUM
Re: The First Trust Special Situations Trust, Series 98
As indicated in our cover letter transmitting the
Registration Statement on Form S-6 and other related material
under the Securities Act of 1933 to the Commission, the only
difference of consequence (except as described below) between The
First Trust Special Situations Trust, Series 94, which is the
current fund, and The First Trust Special Situations Trust,
Series 98, the filing of which this memorandum accompanies, is
the change in the series number. The list of bonds comprising
the Fund, the evaluation, record and distribution dates and other
changes pertaining specifically to the new series, such as size
and number of Units in the Fund and the statement of condition of
the new Fund, will be filed by amendment.
1940 ACT
FORMS N-8A AND N-8B-2
These forms were not filed, as the Form N-8A and Form N-8B-2
filed in respect of Templeton Growth and Treasury Trust, Series 1
and subsequent series (File No. 811-05903) related also to the
subsequent series of the Fund.
1933 ACT
PROSPECTUS
The only significant changes in the Prospectus from the
Series 94 Prospectus relate to the series number and size and the
date and various items of information which will be derived from
and apply specifically to the bonds deposited in the Fund.
CONTENTS OF REGISTRATION STATEMENT
ITEM A Bonding Arrangements of Depositor:
Nike Securities L.P. is covered by a Broker's Fidelity
Bond, in the total amount of $1,000,000, the insurer
being National Union Fire Insurance Company of
Pittsburgh.
ITEM 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
S-1
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant, The First Trust Special Situations Trust, Series
98 has duly caused this Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the
Village of Lisle and State of Illinois on May 13, 1994.
THE FIRST TRUST SPECIAL SITUATIONS
TRUST, SERIES 98
(Registrant)
By: NIKE SECURITIES L.P.
(Depositor)
By Carlos E. Nardo
Senior Vice President
Pursuant to the requirements of the Securities Act of 1933,
this 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 May 13, 1994
Corporation, the
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., the Depositor.
** An executed copy of the related power of attorney was filed
with the Securities and Exchange Commission in connection
with 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 by this reference.
S-2
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 ERNST & YOUNG
The consent of Ernst & Young to the use of its name and to
the reference to such firm in the Prospectus included in this
Registration Statement will be filed by amendment.
CONSENT OF SECURITIES EVALUATION SERVICE, INC.
The consent of Securities Evaluation Service, Inc. to the
use of its name in the Prospectus included in the Registration
Statement is filed as Exhibit 4.1 to the Registration Statement
S-3
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 98 among Nike
Securities L.P., as Depositor, United States Trust
Company of New York, as Trustee, Securities Evaluation
Service, Inc., as Evaluator, and First Trust Advisors
L.P., as 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 Corporaiton, 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-4
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 Securities Evaluation Service, Inc.
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).
___________________________________
* To be filed by amendment.
S-5
