File No. 33-54199
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-1004
POST-EFFECTIVE
AMENDMENT NO. 1
TO
FORM S-6
For Registration Under the Securities Act of 1933 of Securities
of Unit Investment Trusts Registered on Form N-8B-2
FIRST INVESTORS SPECIAL SITUATIONS GROWTH AND TREASURY SECURITIES
TRUST, SERIES 1
(Exact Name of Trust)
NIKE SECURITIES L.P.
(Exact Name of Depositor)
1001 Warrenville Road
Lisle, Illinois 60532
(Complete address of Depositor's principal executive offices)
NIKE SECURITIES L.P. CHAPMAN AND CUTLER
Attn: James A. Bowen Attn: Eric F. Fess
1001 Warrenville Road 111 West Monroe Street
Lisle, Illinois 60532 Chicago, Illinois 60603
(Name and complete address of agents for service)
It is proposed that this filing will become effective (check
appropriate box)
: : immediately upon filing pursuant to paragraph (b)
: x : September 29, 1995
: : 60 days after filing pursuant to paragraph (a)
: : on (date) pursuant to paragraph (a) of rule (485 or 486)
Pursuant to Rule 24f-2 under the Investment Company Act of
1940, the issuer has registered an indefinite amount of
securities. A 24f-2 Notice for the offering was last filed on
July 14, 1995.
<PAGE>
FIRST INVESTORS SPECIAL SITUATIONS
GROWTH & TREASURY SECURITIES TRUST, SERIES 1
1,135,000 UNITS
PROSPECTUS
Part One
Dated September 22, 1995
Note: Part One of this Prospectus may not be distributed unless accompanied by
Part Two.
The Trust
First Investors Special Situations Growth & Treasury Securities Trust,
Series 1 (the "Trust") is a unit investment trust consisting of a portfolio of
"zero coupon" U.S. Treasury bonds and shares of "First Investors Special
Situations Series ("Special Situations" or "Series"), a separate designated
series of First Investors Series Fund (the "Fund"). The fund is an open-end
diversified management investment company, commonly known as a mutual fund.
At August 16, 1995, each Unit represented a 1/1,135,000 undivided interest in
the principal and net income of the Trust (see "The Trust" in Part Two).
The Units being offered by this Prospectus are issued and outstanding Units
which have been purchased by the Sponsor in the secondary market or from the
Trustee after having been tendered for redemption. The profit or loss
resulting from the sale of Units will accrue to the Sponsor. No proceeds from
the sale of Units will be received by the Trust.
Public Offering Price
The Public Offering Price per Unit is equal to the aggregate value of the
Securities in the Portfolio of the Trust, plus or minus cash, if any, in the
Income and Capital Accounts of the Trust divided by the number of Units
outstanding, plus a sales charge of 6.0% of the Public Offering Price (6.383%
of the net amount invested) excluding income and principal cash. At
August 16, 1995, the Public Offering Price per Unit was $11.6073 (see "Public
Offering" in Part Two). The minimum purchase is 200 Units.
Please retain both parts of this Prospectus for future reference.
_____________________________________________________________________________
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.
_____________________________________________________________________________
NIKE SECURITIES L.P.
Sponsor
<PAGE>
FIRST INVESTORS SPECIAL SITUATIONS
GROWTH & TREASURY SECURITIES TRUST, SERIES 1
SUMMARY OF ESSENTIAL INFORMATION AS OF AUGUST 16, 1995
Sponsor: Nike Securities L.P.
Evaluator: First Trust L.P. Advisors
Trustee: The Bank of New York
<TABLE>
<CAPTION>
GENERAL INFORMATION
<S> <C>
Aggregate Maturity Value of Treasury Obligations
in the Trust $11,350,000
Aggregate Number of Shares of Special Situations in
the Trust 322,340
Number of Units 1,135,000
Fractional Undivided Interest in the Trust per Unit 1/1,135,000
Public Offering Price:
Aggregate Value of Securities in the Portfolio $12,398,135
Aggregate Value of Securities per Unit $10.9235
Income and Principal cash in the Portfolio $(15,229)
Income and Principal cash per Unit $(.0134)
Sales Charge 6.383% (6.0% of Public Offering Price,
excluding income and principal cash) $.6972
Public Offering Price per Unit $11.6073
Redemption Price and Sponsor's Repurchase Price per
Unit ($.6972 less than the Public Offering Price per
Unit) $10.9101
</TABLE>
Date Trust Established June 27, 1994
Mandatory Termination Date August 15, 2005
Evaluator's Annual Fee: $.0020 per $10.00 principal amount of Treasury
Obligations outstanding. Evaluations for purposes of sale, purchase or rede
mption of Units are made as of the close of trading (4:00 p.m. Eastern time) o
n the New York Stock Exchange on each day on which it is open.
Supervisory fee payable to an affiliate Maximum of $.0015 per
of the Sponsor Unit outstanding annually
Trustee's Annual Fee: $.0085 per Unit outstanding.
Record Date: As soon as practicable after Special Situations'
ex-dividend date.
Distribution Date: As soon as practicable after Special Situations'
distribution date.
<PAGE>
REPORT OF INDEPENDENT AUDITORS
The Unit Holders of First Investors
Special Situations Growth & Treasury
Securities Trust, Series 1
We have audited the accompanying statement of assets and liabilities,
including the portfolio, of First Investors Special Situations Growth &
Treasury Securities Trust, Series 1 as of May 31, 1995, and the related
statements of operations and changes in net assets for the period from the
Initial Date of Deposit, June 27, 1994, to May 31, 1995. These financial
statements are the responsibility of the Trust's Sponsor. Our responsibility
is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of securities owned as of May 31, 1995, by
correspondence with the Trustee. An audit also includes assessing the
accounting principles used and significant estimates made by the Sponsor, as
well as evaluating the overall financial statement presentation. We believe
that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of First Investors Special
Situations Growth & Treasury Securities Trust, Series 1 at May 31, 1995, and
the results of its operations and changes in its net assets for the period
from the Initial Date of Deposit, June 27, 1994, to May 31, 1995, in
conformity with generally accepted accounting principles.
ERNST & YOUNG LLP
Chicago, Illinois
September 1, 1995
<PAGE>
FIRST INVESTORS SPECIAL SITUATIONS
GROWTH & TREASURY SECURITIES TRUST, SERIES 1
STATEMENT OF ASSETS AND LIABILITIES
May 31, 1995
<TABLE>
<CAPTION>
ASSETS
<S> <C>
Securities, at market value (cost, including accretion
on the treasury obligations, $10,799,243) (Note 1) $11,616,019
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND NET ASSETS
<S> <C> <C>
Accrued liabilities 5,675
Cash overdraft 844
__________
6,519
__________
Net assets, applicable to 1,135,000 outstanding
units of fractional undivided interest:
Cost of Trust assets, including accretion on
the treasury obligations (Note 1) $10,799,243
Net unrealized appreciation (Note 2) 816,776
Distributable funds (deficit) (6,519)
__________
$11,609,500
===========
Net asset value per unit $10.2286
===========
</TABLE>
[FN]
See accompanying notes to financial statements.
<PAGE>
FIRST INVESTORS SPECIAL SITUATIONS
GROWTH & TREASURY SECURITIES TRUST, SERIES 1
PORTFOLIO - See accompanying notes to financial statements.
May 31, 1995
<TABLE>
<CAPTION>
Maturity Market
value Name of Issuer and Title of Security value
<C> <S> <C>
"Zero Coupon" U.S. Treasury Bonds
$11,350,000(1) maturing on August 15, 2005 $5,913,825
=============
</TABLE>
<TABLE>
<CAPTION>
Number
of
Shares
<C> <S> <C>
322,340 First Investors Series Fund, Special
Situations Series 5,702,194
___________
Total investments $11,616,019
===========
</TABLE>
(1) The treasury obligations have been purchased at a discount from their
par value because there is no stated interest income thereon (such
securities are often referred to as U.S. Treasury zero coupon bonds).
Over the life of the treasury obligations the value increases, so that
upon maturity the holders will receive 100% of the principal amount
thereof.
<PAGE>
FIRST INVESTORS SPECIAL SITUATIONS
GROWTH & TREASURY SECURITIES TRUST, SERIES 1
STATEMENT OF OPERATIONS
Period from the Initial Date of Deposit,
June 27, 1994, to May 31, 1995
<TABLE>
<S> <C>
Interest income $361,318
Dividends:
Capital gain 293,651
Ordinary income -
__________
Total investment income 654,969
Expenses:
Trustee's fees and related expenses (10,208)
Evaluator's fees (1,880)
Supervisory fees (1,404)
__________
Total expenses (13,492)
__________
Investment income - net 641,477
Net gain (loss) on investments:
Net realized gain (loss) -
Change in unrealized appreciation
or depreciation 816,776
__________
816,776
__________
Net increase in net assets
resulting from operations $1,458,253
==========
</TABLE>
[FN]
See accompanying notes to financial statements.
<PAGE>
FIRST INVESTORS SPECIAL SITUATIONS
GROWTH & TREASURY SECURITIES TRUST, SERIES 1
STATEMENT OF CHANGES IN NET ASSETS
Period from the Initial Date of Deposit,
June 27, 1994, to May 31, 1995
<TABLE>
<S> <C>
Net increase (decrease) in net assets
resulting from operations:
Investment income - net $641,477
Net realized gain (loss) on investments -
Change in unrealized appreciation or
(depreciation) on investments 816,776
___________
1,458,253
Units issued (1,125,000) 10,348,058
Distributions to unit holders:
Investment income - net (286,678)
Principal from investment transactions -
___________
(286,678)
___________
Total increase (decrease) in net assets 11,519,633
Net assets:
At the beginning of the period (representing
10,000 units outstanding) 89,867
___________
At the end of the period (including
distributable funds (deficit) applicable
to Trust units of $(6,519)) $11,609,500
===========
Trust units outstanding at the end of
the period 1,135,000
</TABLE>
[FN]
See accompanying notes to financial statements.
<PAGE>
FIRST INVESTORS SPECIAL SITUATIONS
GROWTH & TREASURY SECURITIES TRUST, SERIES 1
NOTES TO FINANCIAL STATEMENTS
1. Significant accounting policies
Security valuation -
The treasury obligations are stated at values as determined by First Trust
Advisors L.P., an affiliate of the Sponsor. The values are based on
(1) current bid prices for the securities obtained from dealers or brokers who
customarily deal in securities comparable to those held by the Trust,
(2) current bid prices for comparable securities, (3) appraisal or (4) any
combination of the above.
Shares of First Investors Special Situations Series Fund (Special Situations)
are stated at Special Situations' published net asset value as reported by the
Evaluator. Net asset value is determined by dividing the value of Special
Situations' securities plus any cash and other assets (including accrued
interest and dividends receivable) less all liabilities (including accrued
expenses) by the number of shares outstanding, adjusted to the nearest whole
cent.
Investment income -
Dividends from the Special Situations shares are recorded on Special
Situations' ex-dividend date. Interest income consists of amortization of
original issue discount and market discount or premium on the treasury
obligations. Such amortization is included in the cost of treasury
obligations rather than in distributable funds because it is not currently
available for distribution to unit holders.
Security cost -
Cost of the Trust's treasury obligations is based on the offering price of the
treasury obligations on the dates the treasury obligations were deposited in
the Trust, plus amortization of original issue discount and amortization of
market discount or premium. Cost of the Special Situations shares is based on
the net asset value of such securities on the dates the securities were
deposited in the Trust. The cost of securities sold is determined using the
average cost method. Sales of securities are recorded on the trade date.
Federal income taxes -
The Trust is not taxable for Federal income tax purposes. Each unit holder is
considered to be the owner of a pro rata portion of the Trust and,
accordingly, no provision has been made for Federal income taxes.
Expenses of the Trust -
The Trust pays a fee for Trustee services to The Bank of New York, which is
based on $.0085 per annum per unit outstanding based on the largest aggregate
number of units outstanding during the calendar year. The Evaluator will
receive an annual fee based on $.002 per $10 principal amount of treasury
obligations outstanding. Additionally, the Trust pays recurring financial
reporting costs and an annual supervisory fee payable to an affiliate of the
Sponsor.
<PAGE>
2. Unrealized appreciation and depreciation
An analysis of net unrealized appreciation at May 31, 1995 follows:
<TABLE>
<CAPTION>
Special
Treasury Situation
obligations shares Total
<S> <C> <C> <C>
Unrealized appreciation $578,827 237,949 816,776
Unrealized depreciation - - -
____________________________________
$578,827 237,949 816,776
====================================
</TABLE>
3. Other information
Cost to investors -
The cost to initial investors of units of the Trust was based on the aggregate
offering price of the treasury obligations and the aggregate underlying value
of the equity securities on the date of an investor's purchase, plus a sales
charge of 6.0% of the public offering price which is equivalent to
approximately 6.383% of the net amount invested.
Distributions to unit holders -
Distributions to unit holders are made as soon as practicable after Special
Situations' distribution date. During the period from the Initial Date of
Deposit, June 27, 1994 to May 31, 1995, the Trust made distributions totaling
$.2526 per unit as described below.
<PAGE>
Selected data per unit of the Trust
outstanding throughout the period -
<TABLE>
<CAPTION>
Period from the Initial
Date of Deposit,
June 27, 1994, to
May 31, 1995
<S> <C>
Investment income - interest and dividends $.6476
Expenses (.0133)
________
Investment income - net .6343
Distributions to unit holders:
Investment income - net (.2526)
Principal from investment transactions -
Net gain (loss) on investments .8602
________
Total increase (decrease) in net assets 1.2419
Net assets:
Beginning of the period 8.9867
________
End of the period $10.2286
========
</TABLE>
Investment income - interest and dividends, Expenses and Investment income -
net per unit have been calculated based on the weighted average number of
units outstanding during the period (1,011,331 units). Distributions to unit
holders of Investment income - net per unit reflects the Trust's actual
distribution of approximately $.2526 per unit to 1,135,000 units on
February 1, 1995. The Net gain (loss) on investments per unit includes the
effects of changes arising from issuance of 1,125,000 additional units during
the period at net asset values which differed from the net asset value per
unit of the original 10,000 units ($8.9867 per unit) on June 27, 1994.
<PAGE>
FIRST INVESTORS SPECIAL SITUATIONS
GROWTH & TREASURY SECURITIES TRUST, SERIES 1
PART ONE
Must be Accompanied by Part Two
___________________
P R O S P E C T U S
___________________
SPONSOR: Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
(800) 621-1675
TRUSTEE: The Bank of New York
101 Barclay Street
New York, New York 10005
LEGAL COUNSEL Chapman and Cutler
TO SPONSOR: 111 West Monroe Street
Chicago, Illinois 60603
LEGAL COUNSEL Tanner Propp & Farber
TO TRUSTEE: 99 Park Avenue
New York, New York 10016
INDEPENDENT Ernst & Young LLP
AUDITORS: Sears Tower
233 South Wacker Drive
Chicago, Illinois 60606
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 statement 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 Investors Special Situations
Growth & Treasury Securities Trust
PROSPECTUS NOTE: THIS PART TWO PROSPECTUS MAY
Part Two ONLY BE USED WITH PART ONE
Dated September 25, 1995
The Trust. First Investors Special Situations Growth & Treasury
Securities Trust (the "Trust") is a unit investment trust consisting
of a portfolio of zero coupon U.S. Treasury bonds and shares of
First Investors Special Situations Series ("Special Situations"
or "Series"), a separate designated series of First Investors
Series Fund (the "Fund"). The Fund is an open-end diversified
management investment company, commonly known as a mutual fund.
The objective of the Trust is to protect Unit holders' capital
by investing a portion of the Trust's portfolio in zero coupon
U.S. Treasury bonds ("Treasury Obligations") and to provide for
potential capital appreciation by investing a portion of the Trust's
portfolio in shares of Special Situations. Collectively the Treasury
Obligations and the Special Situations shares are referred to
herein as the "Securities." Special Situations' investment objective
is to seek long-term growth of capital. Special Situations invests
principally in common stocks of companies with small to medium
market capitalization which the Series' investment adviser, First
Investors Management Company, Inc. ("FIMCO" or "Adviser"), considers
to be undervalued or less well known in the current marketplace
and to have potential for capital growth. The majority of such
common stocks are listed on the domestic securities exchanges
or are traded in the over-the-counter market. Special Situations
may also invest in other common stocks, preferred stocks, convertible
securities issued by such companies and common stock of companies
located outside the United States. See "What is Special Situations'
Investment Objectives and Policies?" and "Description of Certain
Securities, Other Investment Policies and Risk Factors." 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. This Trust is intended to achieve
its objective over the life of the Trust and as such is best suited
for those investors capable of holding Units to maturity. There
is, of course, no guarantee that the objective of the Trust will
be achieved. See "Portfolio" in Part One.
The Trust has a mandatory termination date ("Mandatory Termination
Date" or "Trust Ending Date") as set forth under "Summary of Essential
Information" in Part One.
Each Unit of the Trust represents an undivided fractional interest
in all the Securities deposited in the Trust. The Trust has been
organized so that purchasers of Units should receive, at the termination
of the Trust, an amount per Unit at least equal to $10.00 (which
is equal to the per Unit value upon maturity of the Treasury Obligations),
even if the Trust never paid a dividend and the value of the Special
Situations shares were to decrease to zero, which the Sponsor
considers highly unlikely. This feature of the 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. As a result of the volatile nature of the market
for zero coupon U.S. Treasury bonds, Units sold or redeemed prior
to maturity will fluctuate in price and the underlying Treasury
Obligations may be valued at a price greater or less than their
value as of the Initial Date of Deposit. UNIT HOLDERS DISPOSING
OF THEIR UNITS PRIOR TO THE MATURITY OF THE TRUST MAY RECEIVE
MORE OR LESS THAN $10.00 PER UNIT, DEPENDING ON MARKET CONDITIONS
ON THE DATE UNITS ARE SOLD OR REDEEMED.
BOTH PARTS OF THE PROSPECTUS SHOULD BE RETAINED FOR FUTURE REFERENCE.
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.
Page 1
The Treasury Obligations deposited in the Trust will mature on
August 15, 2005 (the "Treasury Obligations Maturity Date"). The
Treasury Obligations in the Trust have a maturity value equal
to or greater than the aggregate Public Offering Price (which
includes the sales charge) of the Units of the Trust on the Initial
Date of Deposit. The Special Situations shares deposited in the
Trust's portfolio have no fixed maturity date and the net asset
value of the shares will fluctuate. See "Portfolio" in Part One.
The Trust will automatically terminate shortly after the maturity
of the Treasury Obligations deposited therein.
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 net asset value of the Special
Situations shares in the Trust 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 as set forth in "Summary of Essential
Information" in Part One. The minimum purchase is that amount
set forth in Part One. The sales charge is reduced on a graduated
scale for sales involving at least 2,500 Units. See "How is the
Public Offering Price Determined?"
Income and Capital Gains Distributions. Distributions, if any,
of net income, other than amortized discount, will be made at
least annually. Distributions of realized capital gains, if any,
received by the Trust, will be made whenever Special Situations
makes such a distribution. Any distribution of income and/or capital
gains will be net of the expenses of the Trust. INCOME WITH RESPECT
TO THE ACCRUAL OF ORIGINAL ISSUE DISCOUNT ON THE TREASURY OBLIGATIONS
WILL NOT BE DISTRIBUTED CURRENTLY, ALTHOUGH UNIT HOLDERS WILL
BE SUBJECT TO FEDERAL 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 the Trust,
the Trustee will distribute, upon surrender of Units for redemption,
to each Unit holder his or her pro rata share of the Trust's assets,
less expenses, in the manner set forth under "Rights of Unit Holders-How
are Income and Capital Distributed?"
Reinvestment. Each Unit holder will, unless he or she elects to
receive cash payments, have distributions of principal (including,
if elected by Unit holders, the proceeds received upon the maturity
of the Treasury Obligations in the Trust at termination), capital
gains, if any, and income earned by the Trust, automatically invested
in shares of Special Situations (if Units are registered in the
Unit holder's state of residence) in the name of the Unit holder.
Such distributions (including, if elected by Unit holders, the
proceeds received upon the maturity of the Treasury Obligations
in the Trust at termination) will be reinvested without a sales
charge to the Unit Holder on each applicable distribution date.
See "Rights of Unit Holders-How Can Distributions to Unit Holders
be Reinvested?"
Secondary Market for Units. The Sponsor may maintain a market
for Units of the Trust and offer to resell such Units at prices
which are based on the aggregate bid side evaluation of the Treasury
Obligations and the aggregate net asset value of Special Situations
shares in the Trust 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 as set forth in "Summary of Essential Information"
in Part One. As of the date of this Prospectus, the Sponsor is
maintaining a secondary market. If a secondary market is not maintained
in the future, a Unit holder may redeem Units through redemption
at prices based upon the aggregate bid price of the Treasury Obligations
plus the aggregate net asset value of the Special Situations shares
in the Trust plus or minus a pro rata share of cash, if any, in
the Capital and Income Accounts of the Trust. All expenses incurred
in maintaining a secondary market, other than the fees of the
Evaluator, the supervisory and audit expenses 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 OR HER UNITS, HE OR SHE SHOULD INQUIRE OF THE SPONSOR
AS TO CURRENT MARKET PRICES PRIOR TO MAKING A TENDER FOR REDEMPTION
TO THE TRUSTEE. See "Rights of Unit Holders-How May Units be Redeemed?"
Page 2
First Investors Special Situations
Growth & Treasury Securities Trust
What is First Investors Special Situations Growth & Treasury Securities
Trust?
The First Investors Special Situations Growth & Treasury Securities
Trust is a series of investment companies created by the Sponsor
under the name of First Investors Special Situations Growth &
Treasury Securities Trust, all of which are generally similar
but each of which is separate and is designated by a different
series number (the "Trust"). This 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, The Bank of New York, as Trustee, First Trust
Advisors L.P., as Portfolio Supervisor and FT Evaluators L.P.
as Evaluator.
The objective of the Trust is to protect Unit holders' capital
by investing a portion of the Trust's portfolio in zero coupon
U.S. Treasury bonds ("Treasury Obligations") and to provide for
potential capital appreciation by investing a portion of the Trust's
portfolio in shares of First Investors Special Situations Series
("Special Situations" or "Series"), a separate designated series
of First Investors Series Fund (the "Fund"). The Fund is an open-end
diversified management company. Special Situations' investment
objective is to seek long-term growth of capital. 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 more or less than a Unit
holder's acquisition cost. Collectively, the Treasury Obligations
and Special Situations shares in the Trust are referred to herein
as the "Securities." There is, of course, no guarantee that the
objective of the Trust will be achieved.
The Trust has been organized so that purchasers of Units should
receive, at the termination of the Trust, an amount per Unit at
least equal to $10.00 per Unit (which is equal to the per Unit
value upon maturity of the Treasury Obligations), even if the
Special Situations shares never paid a dividend and the value
of Special Situations shares 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 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 Trust (an event which the Sponsor believes is unlikely)
represents a substantial loss on a present value basis. 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).
To the extent that Units of the Trust are redeemed, the aggregate
value of the Securities in the Trust will be reduced and the undivided
fractional interest represented by each outstanding Unit of the
Trust will increase. See "How May Units be Redeemed?" The Trust
has a Mandatory Termination Date as set forth herein under "Summary
of Essential Information."
What are the Expenses and Charges?
At no cost to the Trust, the Sponsor has borne all the expenses
of creating and establishing the Trust, including the cost of
the initial preparation, printing and execution of the Indenture
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 Trust. However, First Trust Advisors L.P., an affiliate of
the Sponsor, will receive an annual supervisory fee, which is
not to exceed the amount set forth under "Summary of Essential
Information" appearing in Part One, for providing portfolio supervisory
services for the Trust. Such fee is based on the number of Units
outstanding in the Trust on January 1 of each year except during
the year or years in which an initial offering period occurs in
which case the fee for a month is based on the number of Units
outstanding at the end of such month. The fee may exceed the actual
costs of providing such supervisory services for the Trust, but
at no time will the total amount received for portfolio
Page 3
supervisory services rendered to unit investment trusts of which
Nike Securities L.P. is the Sponsor in any calendar year exceed
the aggregate cost of First Trust Advisors L.P. of supplying such
services in such year.
The Evaluator will receive a fee as indicated in the "Summary
of Essential Information" appearing in Part One. No fee is paid
to the Evaluator with respect to the Special Situations shares
in the Trust. The Trustee pays certain expenses of the Trust for
which it is reimbursed by the Trust. The Trustee will receive
for its ordinary recurring services to the Trust and for all normal
expenses of the Trustee incurred by or in connection with its
responsibilities under the Indenture, an annual fee computed at
$0.0085 per annum per Unit in the 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." Rule 12b-1 fees imposed on shares of Special
Situations held in the Trust, are rebated to the Trust, deposited
in the Income Account and are used to pay expenses of the Trust.
The Trustee's and Evaluator's fees are payable from the Income
Account of the Trust to the extent funds are available and then
from the Capital Account of the 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 non-interest bearing to Unit holders, the Trustee benefits
thereby. Part of the Trustee's compensation for its services to
the 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 the
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 the 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 the 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 the Trust; all taxes and other government charges
imposed upon the Securities or any part of the 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 the Trust. In addition, the Trustee is empowered to
sell Securities in the 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 the Trust except that the
Trustee shall not sell Treasury Obligations to pay Trust expenses.
Since the Special Situations shares consist primarily of common
stock and the income stream produced by dividends is unpredictable,
the Sponsor cannot provide any assurance that dividends will be
sufficient to meet any or all expenses of the Trust. As discussed
above, if dividends are insufficient to cover expenses, it is
likely that Special Situations shares will have to be sold to
meet Trust expenses. These sales may result in capital gains or
losses to Unit holders. See "What is the Federal Tax Status of
Unit Holders?"
The Indenture requires the Trust to be audited on an annual basis
at the expense of the Trust by independent auditors selected by
the Sponsor. So long as the Sponsor is making a secondary market
for the Units, the Sponsor is required to bear the cost of such
annual audits to the extent such cost exceeds $0.005 per Unit.
Unit holders of the 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. 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
Page 4
Code of 1986, as amended (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 Trust.
In the opinion of Chapman and Cutler, counsel for the Sponsor,
under existing law:
1. The 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 the Trust
under the Code; the income of the Trust will be treated as income
of the Unit holders thereof under the Code; and each Unit holder
will be considered to have received his or her pro rata share
of income derived from each Trust asset when such income is received
by the Trust.
2. Each Unit holder will have a taxable event when the Trust
disposes of a Security (whether by sale, exchange, redemption,
or payment at maturity) or upon the sale or redemption of Units
by such Unit holder. The price a Unit holder pays for his or her
Units, including sales charges, is allocated among his or her
pro rata portion of each Security held by the Trust (in proportion
to the fair market values thereof on the date the Unit holder
purchases his or her Units) in order to determine his or her initial
cost for his or her pro rata portion of each Security held by
the Trust. The Treasury Obligations held by the Trust are treated
as stripped bonds and will in all likelihood be treated as bonds
issued at an original issue discount as of the date a Unit holder
purchases his or her Units. Because the Treasury Obligations represent
interests in "stripped" U.S. Treasury bonds, a Unit holder's initial
cost for his or her pro rata portion of each Treasury Obligation
held by the 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 will be required to include in gross
income for each taxable year the sum of his or her 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 Temporary 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 each year. Unit holders should consult their
tax advisers regarding the Federal income tax consequences and
accretion of original issue discount under the stripped bond rules.
3. A Unit holder's portion of gain, if any, upon the sale or
redemption of Units or the disposition of Securities held by the
Trust will generally be considered a capital gain except in the
case of a dealer or a financial institution and, in general, will
be long-term if the Unit holder has held his or her 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 the Trust will generally be considered a capital loss
except in the case of a dealer or a financial institution and
will be long-term if the Unit holder has held his or her 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 the
Trust, including fees of the Trustee and the Evaluator but not
including expenses incurred by Special Situations, the shares
of which are held by the Trust.
Page 5
Because Unit holders are deemed to directly own a pro rata portion
of the Special Situations shares as discussed above, Unit holders
are advised to read the discussion of tax consequences set forth
in the current prospectus for Special Situations. Distributions
declared by Special Situations on the Special Situations shares
in October, November or December that are held by the Trust and
paid during the following January will be treated as having been
received by Unit holders on December 31 in the year such distributions
were declared. Long-term capital gains distributions on the Special
Situations shares are taxable to the Unit holders as long-term
capital gains regardless of how long a person has been a Unit
holder. If a Unit holder holds his or her Units for six months
or less or if the Trust holds shares of Special Situations for
six months or less, any loss incurred by a Unit holder related
to the disposition of Special Situations shares will be treated
as a long-term capital loss to the extent of any long-term capital
gains distributions received (or deemed to have been received)
with respect to such shares. For taxpayers other than corporations,
net capital gains are subject to a maximum marginal tax rate of
28 percent.
The Revenue Reconciliation Act of 1993 (the "Tax Act") raised
tax rates on ordinary income while capital gains remain subject
to a 28% maximum stated rate for taxpayers other than corporations.
Because some or all capital gains are taxed at a comparatively
lower rate under the Tax Act, the Tax Act includes a provision
that recharacterizes capital gains as ordinary income in the case
of certain financial transactions that are "conversion transactions"
effective for transactions entered into after April 30, 1993.
Unit holders and prospective investors should consult with their
tax advisers regarding the potential effect of this provision
on their investment in Units.
Special Situations may elect to pass through to its shareholders
the foreign income and similar taxes paid by Special Situations
in order to enable such shareholders to take a credit (or deduction)
for foreign income taxes paid by Special Situations. If such an
election is made, Unit holders of the Trust, because they are
deemed to own a pro rata portion of the Special Situations shares
held by the Trust, as described above, must include in their gross
income, for Federal income tax purposes, both their portion of
dividends received by the Trust from Special Situations, and also
their portion of the amount which Special Situations deems to
be the Trust's portion of foreign income taxes paid with respect
to, or withheld from, dividends, interest or other income of Special
Situations from its foreign investments. Unit holders may then
subtract from their Federal income tax the amount of such taxes
withheld, or else treat such foreign taxes as deductions from
gross income; however, as in the case of investors receiving income
directly from foreign sources, the above described tax credit
or deduction is subject to certain limitations. Unit holders should
consult their tax advisers regarding this election and its consequences
to them.
General. Each Unit holder will be requested to provide its 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 the Trust to such Unit holder (including amounts
received upon the redemption of Units) will be subject to back-up
withholding. Distributions by the Trust will generally be subject
to United States income taxation and withholding in the case of
Units held by non-resident alien individuals, foreign corporations
or other non-United States persons (accrual of original issue
discount on the Treasury Obligations may not be subject to Federal
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, income and long-term capital gains distributions
includable in the Unit holder's gross income and the amount of
Trust expenses which may be claimed as itemized deductions.
Distributions of income, long-term capital gains and accrual of
original issue discount may also be subject to state and local
taxes. Foreign investors may be subject to different Federal income
tax consequences than those described above. Investors should
consult their tax advisers for specific information on the tax
consequences of particular types of distributions.
Page 6
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 Trust Suitable for Retirement Plans?"
In the opinion of Tanner Propp & Farber, Special Counsel to the
Trust for New York tax matters, under the existing income tax
laws of the State of New York, the Trust is not an association
taxable as a corporation and the income of the Trust will be treated
as the income of the Unit holders thereof.
Why are Investments in the Trust Suitable for Retirement Plans?
Units of the Trust may be well suited for purchase by Individual
Retirement Accounts, pension funds and other tax-deferred retirement
plans. Generally, the Federal income tax relating to capital gains
and income received in each of the foregoing plans is deferred
until distributions are received. Distributions from such plans
are generally treated as ordinary income but may, in some cases,
be eligible for special averaging or tax-deferred rollover treatment.
Investors considering participation in any such plan should review
specific tax laws related thereto and should consult their attorneys
or tax advisers with respect to the establishment and maintenance
of any such plan. Such plans are offered by brokerage firms and
other financial institutions. Fees and charges with respect to
such plans may vary.
PORTFOLIO
What are Treasury Obligations?
The Treasury Obligations deposited in the 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 Trust's portfolio to
be invested in shares of Special Situations.
What is First Investors Special Situations Series?
The portfolio of the Trust also contains shares of First Investors
Special Situations Series.
Organization. First Investors Series Fund is a Massachusetts business
trust organized on September 23, 1988 which contains five series,
including Special Situations Series. The Fund's Board of Trustees
has authority to issue an unlimited number of shares of beneficial
interest of separate series, no par value, of the Fund. Prior
to February 15, 1990, the name of the Fund was First Investors
Fund. Shares of Special Situations Series have equal dividend,
voting, liquidation and redemption rights with all other shares
of that Series. In the event of establishment of classes, each
class of the Series shall represent interests in the assets of
that Series and shall have identical voting, dividend, liquidation
and other rights and the same terms and conditions as any other
class of that Series, except that expenses allocated to a class
of the Series may be borne solely by that class and a class of
the Series may have exclusive voting rights with respect to matters
affecting only that class. The Fund does not hold annual shareholder
meetings. If requested to do so by the holders of at least 10%
of the Fund's outstanding shares, the Board of Trustees will call
a special meeting of shareholders for any purpose, including the
removal of Trustees.
Custodian. The Bank of New York, 48 Wall Street, New York, NY
10286, is a custodian of the securities and cash of the Series.
Page 7
Transfer Agent. Administrative Data Management Corp., 581 Main
Street, Woodbridge, NJ 07095-1198, an affiliate of FIMCO and First
Investors Corporation ("FIC"), acts as transfer and dividend disbursing
agent for the Series and as redemption agent for regular redemptions.
The Transfer Agent's telephone number is 1-800-423-4026.
Share Certificates. The Series does not issue share certificates
unless requested in writing to do so. Ownership of shares of the
Series is recorded on a stock register by the Transfer Agent and
shareholders have the same rights of ownership with respect to
such shares as if certificates had been issued.
Confirmations and Statements. You will receive confirmations of
purchases and redemptions of shares of the Series. Statements
of shares owned will be sent to you following a transaction in
the account, including payment of a dividend or capital gain distribution
in additional shares or cash.
Shareholder Inquiries. Shareholder inquiries regarding Special
Situations can be made by calling Shareholder Services at 1-800-423-4026.
Fee Table. The following table is intended to assist investors
in understanding the expenses associated with investing in the
Series.
Shareholder Transaction Expenses
Maximum Sales Load Imposed on Purchases
(as a percentage of offering price){ 6.25%
Exchange Fee (1) $0
Annual Fund Operating Expenses
(as a percentage of average net assets)
<TABLE>
<CAPTION>
Total Fund
Management 12b-1 Other Operating
Series of the Fund Fees (2) Fees Expenses Expenses (3)
__________________ __________ _____ ________ ____________
<S> <C> <C> <C> <C>
Special Situations Series{{ 0.75%* 0.30% 0.60% 1.65%*
</TABLE>
[FN]
____________________
* Net of waiver and/or reimbursement.
(1) For exchanges into a Series, the $5.00 exchange fee will
be assumed by that Series for a minimum period ending December
31, 1995. The Series reserves the right to change or suspend this
privilege after December 31, 1995.
(2) Management Fees for the Series have been restated to reflect
the maximum advisory fees that may be paid in 1995. FIMCO will
waive 0.25% of Management Fees for the Series for a minimum period
ending December 31, 1995. If not waived, Management Fees for the
Series would be 1.00%.
(3) If certain Management Fees were not waived, Total Fund Operating
Expenses for Special Situations Series would be 1.90%.
{ There is no sales load payable upon the purchase of the Special
Situations shares deposited in the Trust. However, the maximum
sales charge on the Units, and therefore indirectly on the Special
Situations shares is 6.0% in the secondary market.
{{ Effectively, there are no 12b-1 fees on Special Situations
shares held in the Trust. However, Unit holders who acquire shares
of Special Situations through reinvestment of dividends or other
distributions or through reinvestment at the Trust's termination
will begin to incur 12b-1 fees at such time as shares are acquired.
For a more complete description of the various costs and expenses,
see "How to Buy Shares", "How to Redeem Shares", "Management"
and "Distribution Plans" in the Special Situations Prospectus.
Due to the imposition of 12b-1 fees, it is possible that long-term
shareholders of a Series may pay more in total sales charges than
the economic equivalent of the maximum front-end sales charge
permitted by the rules of the National Association of Securities
Dealers, Inc.
The example below is based on expense data for the Series' fiscal
year ended December 31, 1994, except that certain Operating Expenses
have been restated to reflect expenses expected to be incurred
in fiscal 1995, as noted above:
Page 8
EXAMPLE:
You would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return and (2) redemption at the end of each time
period:
<TABLE>
<CAPTION>
One Year Three Years Five Years Ten Years
________ ___________ __________ _________
<S> <C> <C> <C> <C>
Special Situations Series $78 $111 $147 $246
</TABLE>
The expenses in the Example should not be considered a representation
by the Series of past or future expenses. Actual expenses in future
years may be greater or less than those shown.
Financial Highlights. The following table sets forth the Special
Situations Series' per share operating performance data for a
share of beneficial interest outstanding, total return, ratios
to average net assets and other supplemental data for each period
indicated. The table has been derived from financial statements
which are covered by another independent certified public accountants'
report appearing in the Funds' Statement of Additional Information
("SAI"). This information should be read in conjunction with the
Financial Statements and Notes thereto for the Series, which also
appear in the SAI, available at no charge upon request to the Series.
<TABLE>
<CAPTION>
Year Ended December 31
Per Share Data 1991 1992 1993 1994
________ ________ ________ ________
<S> <C> <C> <C> <C>
Net Asset Value - Beginning of Period $ 9.58 $13.99 $15.62 $18.00
Income from Investment Operations:
Net Investment Income (Loss){ .10 - (.08) (.04)
Net Realized and Unrealized Gain
(Loss) on investments 4.74 2.41 3.29 (.62)
________ ________ ________ ________
Total from Investment Operations 4.84 2.41 3.21 (.66)
======== ======== ======== ========
Less Distributions From:
Net Investment Income .10 - - -
Net Realized Gain on Investments .33 .78 .83 .91
________ ________ ________ ________
Total Distributions .43 .78 .83 .91
======== ======== ======== ========
Net Asset Value - End of Period $ 13.99 $15.62 $18.00 $16.43
======== ======== ======== ========
Total Return[] 50.47% 17.26% 20.52% (3.66)%
______________
</TABLE>
<TABLE>
<CAPTION>
Ratios/Supplemental Data
<S> <C> <C> <C> <C>
Net Assets-End of Period (in thousands) 9,183 25,814 59,148 89,906
Ratio of Expenses to Average Net Assets{ - 1.06% 1.55% 1.65%
Ratio of Net Investment Income to
Average Net Assets{ 1.44% (.05)% (.63)% (.26%)
Ratio of Expenses to Average Net Assets Before
Expenses Waived or Assumed 2.31% 1.92% 1.89% 1.90%
Ratio of Net Investment Income to Average Net
Assets Before Expenses Waived or Assumed (.87)% (.91)% (.96)% (.51)%
Portfolio Turnover Rate 86% 88% 71% 53%
</TABLE>
[FN]
____________________
[] Calculated without sales charge.
{ Net of expenses waived or assumed by the investment adviser.
What is Special Situations' Investment Objective and Policies?
Special Situations seeks long-term growth of capital. The Series
seeks to achieve its objective by investing, under normal market
conditions, at least 65% of its total assets in the common stock
of companies with small to medium market capitalization that the
Adviser considers to be undervalued or less well known in the
current marketplace and to have potential for capital growth.
The Series may invest up to 35% of its total assets in other common
stock, in preferred stock that is convertible into common stock
issued by U.S. corporations, and in the common stock of companies
located outside the United States.
Page 9
Special Situations seeks to invest in the common stock of companies
that are undervalued in the current market in relation to fundamental
economic values such as earnings, sales, cash flow and tangible
book value; that are early in their corporate development (i.e.,
before they become widely recognized and well known and while
their reputations and track records are still emerging); or that
offer the possibility of greater earnings because of revitalized
management, new products or structural changes in the economy.
Such companies primarily are those with small to medium market
capitalization, which the Series considers to be up to $1 billion.
The Adviser believes that, over time, these securities are more
likely to appreciate in price than securities whose market prices
have already reached their perceived economic value. In addition,
the Series intends to diversify its holdings among as many companies
and industries as the Adviser deems appropriate.
Companies that are early in their corporate development may be
dependent on relatively few products or services, may lack adequate
capital reserves, may be dependent on one or two management individuals
and may have less of a track record or historical pattern of performance.
In addition, there may be less information available as to the
issuers and their securities may not be well known to the general
public and may not yet have wide institutional ownership. Thus,
the investment risk is higher than that normally associated with
larger, older or better-known companies.
Investments in securities of companies with small to medium market
capitalization are generally considered to offer greater opportunity
for appreciation and to involve greater risk of depreciation than
securities of companies with larger market capitalization. Because
the securities of most companies with small to medium market capitalization
are not as broadly traded as those of companies with larger market
capitalization, these securities are often subject to wider and
more abrupt fluctuations in market price. In the past, there have
been prolonged periods when these securities have substantially
underperformed or outperformed the securities of the larger capitalization
companies. In addition, smaller capitalization companies generally
have fewer assets available to cushion an unforeseen adverse occurrence
and thus such an occurrence may have a disproportionately negative
impact on these companies.
The majority of Special Situations' investments are expected to
be securities listed on the NYSE or other national securities
exchanges, or securities that have an established over-the-counter
("OTC") market, although the depth and liquidity of the OTC market
may vary from time to time and from security to security.
Special Situations may invest up to 15% of its total assets in
common stocks issued by foreign companies which are traded on
a recognized domestic or foreign securities exchange. In addition
to the fundamental analysis of companies and their industries
which it performs for U.S. issuers, the Adviser evaluates the
economic and political climate of the country in which the company
is located and the principal securities markets in which such
securities are traded. Although the foreign stocks in which the
Series invests are primarily denominated in foreign currencies,
the Series also may invest in American Depositary Receipts ("ADRs").
The Series' Adviser does not attempt to time actively either short-term
market trends or short-term currency trends in any market.
The Series may invest up to 5% of its total assets in the securities
of other registered investment companies. Such investments will
probably involve additional advisory or distribution fees. The
Series may borrow money for temporary or emergency purposes in
amounts not exceeding 5% of its total assets. The Series also
may enter into repurchase agreements and engage in short sales
"against the box."
In any period of market weakness or of uncertain market or economic
conditions, the Series may establish a temporary defensive position
to preserve capital by having all or part of its assets invested
in short-term fixed income securities or retained in cash or cash
equivalents, including bank certificates of deposit, bankers'
acceptances, obligations issued or guaranteed as to principal
and interest by the U.S. Government, its agencies or instrumentalities
("U.S. Government Obligations") and commercial paper issued by
domestic corporations. See the SAI for a description of these securities.
The Series' net asset value fluctuates based mainly upon changes
in the value of its portfolio securities. The Series' investment
objective and certain investment limitations set forth in the
SAI are fundamental policies
Page 10
that may not be changed without shareholder approval. There can
be no assurance that the Series will achieve its investment objective.
Description of Certain Securities, Other Investment Policies and
Risk Factors
American Depositary Receipts. Special Situations may invest in
sponsored and unsponsored ADRs. ADRs are receipts typically issued
by a U.S. bank or trust company evidencing ownership of the underlying
securities of foreign issuers, and other forms of depository receipts
for securities of foreign issuers. Generally, ADRs, in registered
form, are denominated in U.S. dollars and are designed for use
in the U.S. securities markets. Thus, these securities are not
denominated in the same currency as the securities into which
they may be converted. In addition, the issuers of the securities
underlying unsponsored ADRs are not obligated to disclose material
information in the United States and, therefore, there may be
less information available regarding such issuers and there may
not be a correlation between such information and the market value
to the ADRs. GDRs are issued globally and evidence a similar ownership
arrangement. Generally, GDRs are designed for trading in non-U.S.
securities markets. ADRs and GDRs are considered to be foreign
securities by the Series.
Convertible Securities. A convertible security is a bond, debenture,
note, preferred stock or other security that may be converted
into or exchanged for a prescribed amount of common stock of the
same or a different issuer within a particular period of time
at a specified price or formula. A convertible security entitles
the holder to receive interest paid or accrued on debt or dividends
paid on preferred stock until the convertible security matures
or is redeemed, converted or exchanged. Convertible securities
have unique investment characteristics in that they generally
(1) have higher yields than common stocks, but lower yields than
comparable non-convertible securities, (2) are less subject to
fluctuation in value than the underlying stock because they have
fixed income characteristics and (3) provide the potential for
capital appreciation if the market price of the underlying common
stock increases. See the SAI for more information on convertible
securities.
Foreign Securities-Risk Factors. Special Situations may sell a
security denominated in a foreign currency and retain the proceeds
in that foreign currency to use at a future date (to purchase
other securities denominated in that currency) or the Series may
buy foreign currency outright to purchase securities denominated
in that foreign currency at a future date. Because Special Situations
does not intend to hedge its foreign investments against the risk
of foreign currency fluctuations, changes in the value of these
currencies can significantly affect the Series' share price. In
addition, the Series will be affected by changes in exchange control
regulations and fluctuations in the relative rates of exchange
between the currencies of different nations, as well as by economic
and political developments. Other risks involved in foreign securities
include the following: there may be less publicly available information
about foreign companies comparable to the reports and ratings
that are published about companies in the United States; foreign
companies are not generally subject to uniform accounting, auditing
and financial reporting standards and requirements comparable
to those applicable to U.S. companies; some foreign stock markets
have substantially less volume than U.S. markets, and securities
of some foreign companies are less liquid and more volatile than
securities of comparable U.S. companies; there may be less government
supervision and regulation of foreign stock exchanges, brokers
and listed companies than exist in the United States; and there
may be the possibility of expropriation or confiscatory taxation,
political or social instability or diplomatic developments which
could affect assets of the Series held in foreign countries.
Money Market Instruments. Investments in commercial paper are
limited to obligations rated Prime-1 by Moody's Investors Service,
Inc. or A-1 by Standard & Poor's Ratings Services, a division
of The McGraw-Hill Companies, Inc. Commercial paper includes notes,
drafts, or similar instruments payable on demand or having a maturity
at the time of issuance not exceeding nine months, exclusive of
days of grace or any renewal thereof. Investments in certificates
of deposit will be made only with domestic institutions with assets
in excess of $500 million. See the SAI for more information regarding
money market instruments and Appendix A to the SAI for a description
of commercial paper ratings.
Page 11
Preferred Stock. A preferred stock is a blend of the characteristics
of a bond and common stock. It can offer the higher yield of a
bond and has priority over common stock in equity ownership, but
does not have the seniority of a bond and, unlike common stock,
its participation in the issuer's growth may be limited. Preferred
stock has preference over common stock in the receipt of dividends
and in any residual assets after payment to creditors should the
issuer be dissolved. Although the dividend is set at a fixed annual
rate, in some circumstances it can be changed or omitted by the issuer.
Repurchase Agreements. Repurchase agreements are transactions
in which the Series purchases securities from a bank or recognized
securities dealer and simultaneously commits to resell the securities
to the bank or dealer at an agreed-upon date and price reflecting
a market rate of interest unrelated to the coupon rate or maturity
of the purchased securities. The Series' risk is limited to the
ability of the seller to repurchase the securities at the agreed-upon
price upon the delivery date. See the SAI for more information
regarding repurchase agreements.
Restricted and Illiquid Securities. The Series may invest up to
15% of its net assets in illiquid securities, including (1) securities
that are illiquid due to the absence of a readily available market
or due to legal or contractual restrictions on resale and (2)
repurchase agreements maturing in more than seven days. However,
illiquid securities for purposes of this limitation do not include
securities eligible for resale under Rule 144A under the Securities
Act of 1933, as amended (the "1933 Act"), which the Fund's Board
of Trustees or the Adviser has determined are liquid under Board-approved
guidelines. The Series may invest up to 5% of its total assets
in Rule 144A securities. See the SAI for more information regarding
restricted and illiquid securities.
U.S. Government Obligations. Securities issued or guaranteed as
to principal and interest by the U.S. Government include (1) U.S.
Treasury obligations which differ only in their interest rates,
maturities and time of issuance as follows: U.S. Treasury bills
(maturities of one year or less), U.S. Treasury notes (maturities
of one to ten years) and U.S. Treasury bonds (generally maturities
of greater than ten years), and (2) obligations issued or guaranteed
by U.S. Government agencies and instrumentalities that are backed
by the full faith and credit of the United States, such as securities
issued by the Federal Housing Administration, Government National
Mortgage Association, the Department of Housing and Urban Development,
the Export-Import Bank, the General Services Administration and
the Maritime Administration and certain securities issued by the
Farmers Home Administration and the Small Business Administration.
The range of maturities of U.S. Government Obligations is usually
three months to thirty years. For additional information concerning
these and other investment policies of the Series, see the SAI.
Who is the Management of Special Situations?
Board of Trustees. The Fund's Board of Trustees, as part of its
overall management responsibility, oversees various organizations
responsible for the Series' day-to-day management.
Adviser. First Investors Management Company, Inc. ("FIMCO") supervises
and manages the Series' investments, determines the Series' portfolio
transactions and supervises all aspects of the Series' operations.
The Adviser is a New York corporation located at 95 Wall Street,
New York, NY 10005. The Adviser presently acts as investment adviser
to 14 mutual funds. First Investors Consolidated Corporation ("FICC")
owns all of the voting common stock of the Adviser and all of
the outstanding stock of FIC and the Transfer Agent. Mrs. Julie
W. Grayson (through shares to be received pursuant to probate
proceedings) and Mr. Glenn O. Head (or members of his family)
are controlling persons of FICC and, therefore, jointly control
the Adviser.
As compensation for its services, the Adviser receives an annual
fee from the Series, which is payable monthly. For the fiscal
year ended December 31, 1994, the advisory fee was 0.75% of average
daily net assets, net of waiver.
The Series bears all expenses of its operations other than those
incurred by the Adviser or the Series' Underwriter under the terms
of its advisory or underwriting agreements. Series expenses include,
but are not limited to: the advisory fee; shareholder servicing
fees and expenses; custodian fees and expenses; legal and auditing
fees; expenses of communicating to existing shareholders, including
preparing, printing and
Page 12
mailing prospectuses and shareholder reports to such shareholders;
and proxy and annual meeting expenses.
Portfolio Manager. Patricia D. Poitra has been Portfolio Manager
for Special Situations Series since its inception in 1990. Ms.
Poitra joined FIMCO in 1985 as a Senior Equity Analyst. Ms. Poitra
also is Portfolio Manager for the Blue Chip Series and Discovery
Series of First Investors Life Series Fund, the Blue Chip Fund
of Executive Investors Trust, the Made In the U.S.A. Fund of First
Investors Series Fund II, Inc., the Blue Chip Series of First
Investors Series Fund and, since 1993, the small capitalization
equity portion of the Total Return Series of First Investors Series Fund.
Brokerage. The Series may allocate brokerage commissions to broker-dealers
in consideration of Series share distribution, but only when execution
and price are comparable to that offered by other broker-dealers.
See the SAI for more information on allocation of portfolio brokerage.
Underwriter. The Fund has entered into an Underwriting Agreement
with FIC, 95 Wall Street, New York, NY 10005, pursuant to which
FIC acts as the Series' Underwriter ("Series Underwriter"). The
Underwriter receives all sales charges in connection with the
sale of the Series' shares and may receive payments under a plan
of distribution. See "How to Buy Shares" and "Distribution Plan"
in the Series' Prospectus.
Regulatory Matters. In June 1992, the Fund's underwriter FIC,
entered into a settlement with the Securities and Exchange Commission
("SEC") to resolve allegations by the agency that certain of FIC's
sales representatives had made misrepresentations concerning the
risks of investing in two high-yield bond funds, the First Investors
Fund For Income, Inc. and the First Investors High Yield Fund,
Inc. ("High Yield Funds"), and had sold these Funds to investors
for whom they were not suitable. Without admitting or denying
the SEC's allegations, FIC: (a) consented to the entry of a final
judgment enjoining it from violating Section 10(b) of the Securities
Exchange Act of 1934 and Rule 10b-5 thereunder and Section 17(a)
of the 1933 Act; (b) agreed to the entry of an administrative
order censuring it and requiring it to comply with undertakings
to improve its policies and procedures with regard to sales, training,
supervision and compliance; and (c) agreed to pay $24.7 million
to certain investors who purchased shares of the High Yield Funds
from in or about November 1984 to in or about November 1990.
FIC, FIMCO and/or certain affiliated entities and persons have
entered into settlements with regulators in 29 states to resolve
allegations, similar to those made by the SEC, concerning sales
of the High Yield Funds. In October 1993, as part of settlements
with Maine, Massachusetts, New York, Virginia and Washington ("State
of Settlements"), FIC, FIMCO and certain affiliated entities and
persons agreed, without admitting or denying any of hte allegations,
(a) to be enjoined from violating certain provisions of the state
securities laws, (b) to engage in remedial measures designed to
ensure that proper sales practices are observed in the future,
and (c) to pay $7.5 million, in addition to the $24.7 million
previously paid by FIC in connection with the SEC settlement,
to investors in the High Yield Funds. In addition, as part of
those settlements, several FIC executives including Glenn O. Head,
who is an officer and trustee of the Fund agreed to be suspended
and enjoined temporarily from associating with any broker/dealer
in a supervisory capacity in certain of the states. On December
8, 1993, several present and former FIC executives, including
Mr. Head, also agreed, without admitting or denying the allegations,
to temporary SEC suspensions form associating with broker/dealers
and in some cases other regulated entities in a supervisory capacity.
Distribution Plan. Pursuant to an Amended and Restated Plan of
Distribution ("12b-1 Plan"), the Series is authorized to pay the
Series' Underwriter a fee at the annual rate of 0.30% of such
Series' average daily net assets as compensation for the Underwriter's
activities relating to the distribution of Series shares ("distribution
fees") and the servicing and maintenance of existing Series shareholder
accounts ("service fees"). Distribution fees are paid for activities
relating to the distribution of the Series' shares, including
costs of printing and dissemination of sales material or literature,
prospectuses and reports used in connection with the sale of Series
shares. Service fees are paid for the ongoing maintenance and
servicing of existing shareholder accounts, including payments
to registered representatives who provide shareholder liaison
services to their customers who are shareholders of the Series,
provided they meet certain criteria.
Page 13
Payments made to the Series' Underwriter under the 12b-1 Plan
will represent compensation for distribution and service activities,
not reimbursement for specific expenses incurred. Thus, even if
the expenses of the Series' Underwriter exceed its distribution
and/or service fees for the Series, the Series will not be obligated
to pay more than those fees, and if the Underwriter's expenses
are less than those fees, it will retain the full fees and realize
a profit. The Series will pay the distribution and service fees
until the Underwriting Agreement or the 12b-1 Plan is terminated
or not renewed. In that event, the expenses of the Series' Underwriter
in excess of distribution and service fees received or accrued
through the termination date will be the Underwriter's sole responsibility
and not obligations of the Series. The distribution and service
fees paid to the Series' Underwriter by the Series will not be
used for expenses of any other series of the Fund.
THE RULE 12B-1 FEES IMPOSED ON SHARES HELD IN THE TRUST ARE REBATED
TO THE TRUST AND ARE USED TO REDUCE EXPENSES OF THE TRUST RESULTING
IN INCREASED DISTRIBUTIONS TO UNIT HOLDERS. UNIT HOLDERS WHO ACQUIRE
SHARES OF SPECIAL SITUATIONS THROUGH REINVESTMENT OF DIVIDENDS
OR OTHER DISTRIBUTIONS OR THROUGH REINVESTMENT AT THE TRUST'S
TERMINATION WILL BEGIN TO INCUR RULE 12B-1 FEES AT SUCH TIME AS
SHARES ARE ACQUIRED.
Determination of Net Asset Value. The net asset value of shares
of the Series is determined as of the close of regular trading
on the NYSE (generally 4:00 p.m. eastern standard time) on each
day the NYSE is open for trading, and at such other times as the
Board of Trustees deems necessary, by dividing the market value
of the securities held by the Series, plus any cash and other
assets, less all liabilities, by the number of shares outstanding.
If there is no available market value, securities will be valued
at their fair value as determined in good faith pursuant to procedures
adopted by the Board of Trustees. The NYSE currently observes
the following holidays: New Year's Day, Presidents' Day, Good
Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving
Day and Christmas Day.
Dividends and Other Distributions. Dividends from net investment
income are generally declared annually by Special Situations Series
and are paid in additional shares of the Series at the net asset
value (without sales charge) generally determined as of the close
of business on the business day immediately following the record
date of the dividend. Net investment income includes interest
and dividends, earned discount and other income earned on portfolio
securities less expenses.
The Series also distributes substantially all of its net capital
gain (the excess of net long-term capital gain over net short-term
capital loss) and net short-term capital gain, if any, after deducting
any available capital loss carryovers, and any net realized gains
from foreign currency transactions, with its regular dividend
at the end of the year. Distributions are paid in additional shares
of the Series at the net asset value (without sales charge) generally
determined as of the close of business on the business day immediately
following the record date of the distribution. The Series may
make an additional distribution if necessary to avoid a Federal
excise tax on certain undistributed income and capital gain.
Performance Information. For purposes of advertising, the Series'
performance may be calculated based on average annual total return
and total return. Each of these figures reflects past performance
and does not necessarily indicate future results. Average annual
total return shows the average annual percentage change in an
assumed $1,000 investment. It reflects the hypothetical annually
compounded return that would have produced the same total return
if the Series' performance had been constant over the entire period.
Because average annual total return tends to smooth out variations
in the Series' return, you should recognize that it is not the
same as actual year-by-year results. Average annual total return
includes the effect of paying the maximum sales charge and payment
of dividends and other distributions in additional shares. Total
return is computed using the same calculations as average annual
total return. However, the rate expressed is the percentage change
from the initial $1,000 invested to the value of the investment
at the end of the stated period.
Each of the above performance calculations may be based on investment
at reduced sales charge levels or at net asset value. Any quotation
of performance figures not reflecting the maximum sales charge
will be greater than if the maximum sales charge were used. Additional
performance information is contained
Page 14
in the Fund's Annual Report which may be obtained without charge
by contacting the Fund at 1-800-423-4026.
What are Some Additional Considerations for Investors?
Investors should be aware of certain other considerations before
making a decision to invest in the Trust described herein.
The Sponsor has obtained an exemptive order of the Securities
and Exchange Commission ("SEC") to enable it to deposit Special
Situations shares purchased for deposit in the Trust. Under the
terms of the exemptive order, the Sponsor has agreed to take certain
steps to ensure that investment in Special Situations shares is
equitable to all parties and particularly that the interests of
the Unit holders are protected. Special Situations has agreed
to waive any sales charge on shares sold to the Trust. Furthermore,
FT Evaluators L.P. has agreed to waive its usual fee for acting
as Evaluator of the Trust's portfolio with respect to that portion
of the portfolio comprised of Special Situations shares, since
information with respect to the price of Special Situations' shares
is readily available to it. In addition, the Indenture requires
the Trustee to vote all shares of Special Situations held in the
Trust in the same manner and ratio on all proposals as the vote
of owners of Special Situations shares not held by the Trust.
The value of Special Situations' shares, like the value of the
Treasury Obligations, will fluctuate over the life of the Trust
and may be more or less than the price at which they were deposited
in the Trust. Special Situations' shares may appreciate or depreciate
in value (or pay dividends or other distributions) depending on
the full range of economic and market influences affecting the
securities in which it is invested and the success of Special
Situations' Adviser in anticipating or taking advantage of such
opportunities as they may occur. However, the Sponsor believes
that, upon termination of the Trust, even if the Special Situations
shares deposited in the 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) for those individuals purchasing on the Initial Date
of Deposit (or any other Date when the value of the Units is $10.00
or less). This feature of the 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 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 Trust, may be less than the amount
paid for a Unit.
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 Trust?" Of course,
the portfolio of Special Situations will be changing as the Adviser
attempts to achieve Special Situations' objective.
To the best of the Sponsor's knowledge, there is no litigation
pending as of the date of this Part Two Prospectus in respect
of any Security which might reasonably be expected to have a material
adverse effect on the Trust. 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 Trust.
PUBLIC OFFERING
How is the Public Offering Price Determined?
Units are offered at the Public Offering Price. The Public Offering
Price is based on the aggregate bid side evaluation of the Treasury
Obligations and the net asset value of the Special Situations
shares in the Trust, plus or minus cash, if any, in the Capital
and Income Accounts held or owned by the Trust, plus a maximum
sales charge of 6.0% of the Public Offering Price (equivalent
to 6.383% of the net amount invested) divided by the number of
outstanding Units of the Trust.
The minimum purchase in the Trust is 200 Units. The applicable
sales charge is reduced by a discount as indicated below for volume
purchases:
Page 15
<TABLE>
<CAPTION>
Percent of Percent of
Offering Net Amount
Number of Units Price Invested
_______________ _________ __________
<S> <C> <C>
2,500 but less than 5,000 5.50% 5.82%
5,000 but less than 10,000 5.25% 5.54%
10,000 but less than 25,000 4.25% 4.44%
25,000 but less than 50,000 3.25% 3.36%
50,000 but less than 75,000 2.25% 2.30%
100,000 or more 1.25% 1.27%
</TABLE>
Any such reduced sales charge shall be the responsibility of FIC.
The reduced sales charge structure will apply on all purchases
of Units in the Trust by the same person on any one day from the
Underwriter. 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 of any such combined purchase prior to the sale
in order to obtain the indicated discount. With respect to the
employees, officers and directors (including their immediate families
and trustees, custodians or a fiduciary for the benefit of such
person) of the Sponsor, Underwriter and their subsidiaries, the
sales charge is reduced by 4.6% of the Public Offering Price for
purchases of Units during the secondary offering period.
The Public Offering Price of Units on the date of this Part Two
Prospectus may vary from the amount stated under "Summary of Essential
Information" in Part One in accordance with fluctuations in the
prices of the underlying Securities. The aggregate value of the
Units of the Trust shall be determined (a) on the basis of the
bid prices of the Treasury Obligations and the net asset value
of the Special Situations shares therein plus or minus a pro rata
share of cash, if any, in the Capital and Income Accounts of the
Trust, (b) if bid prices are not available for the Treasury Obligations,
on the basis of bid prices for comparable securities, (c) by determining
the value of the Treasury Obligations on the offer side of the
market by appraisal or (d) by any combination of the above.
The secondary market Public Offering Price will be equal to the
bid price per Unit of the Treasury Obligations and the net asset
value of the Special Situations shares therein plus or minus a
pro rata share of cash, if any, in the Capital and Income Accounts
of the Trust plus the applicable sales charge.
Although payment is normally made three business days following
the order for purchase (the "date of settlement"), payment may
be made prior thereto. A person will become owner of Units on
the date of settlement provided payment has been received. Cash,
if any, made available to the Sponsor prior to the date of settlement
for the purchase of Units may be used in the Sponsor's business
and may be deemed to be a benefit to the Sponsor, subject to the
limitations of the Securities Exchange Act of 1934. Delivery of
Units so ordered will be made three 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?
Units repurchased in the secondary market may be offered by this
Part Two 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 Trust
for sale in a number of states. Secondary market sales will be
made to dealers and others at prices which represent a concession
or agency commission of 4.0% of the Public Offering Price. However,
resales of Units of the Trust by such dealers and others to the
public will be made at the Public Offering Price described in
this prospectus. The Sponsor reserves the right to change the
amount of the concession or agency commission from time to time.
Certain commercial banks are making Units of the Trust 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 above.
Page 16
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.
From time to time the Sponsor may implement programs under which
Underwriters and dealers of the Trust may receive nominal awards
from the Sponsor for each of their registered representatives
who have sold a minimum number of UIT Units during a specified
time period. In addition, at various times the Sponsor may implement
other programs under which the sales force of 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 Trust. Such payments are made by the Sponsor out
of its own assets, and not out of the assets of the Trust. These
programs will not change the price Unit holders pay for their
Units or the amount that the Trust will receive from the Units sold.
The Sponsor may from time to time in its advertising and sales
materials compare the then current estimated returns on the Trust
and returns over specified periods on other similar Trusts sponsored
by Nike Securities L.P. with returns on other taxable investments
such as corporate or U.S. Government bonds, bank CDs and money
market accounts or money market funds, each of which has investment
characteristics that may differ from those of the Trust. U.S.
Government bonds, for example, are backed by the full faith and
credit of the U.S. Government and bank CDs and money market accounts
are insured by an agency of the Federal government. Money market
accounts and money market funds provide stability of principal,
but pay interest at rates that vary with the condition of the
short-term debt market. The investment characteristics of the
Trust are described more fully elsewhere in this Prospectus.
Trust performance may be compared to performance on the same basis
(with distributions reinvested) of the Dow Jones Industrial Average,
the S&P 500 Composite Price Stock Index, or performance data from
Lipper Analytical Services, Inc. and Morningstar Publications,
Inc. or from publications such as Money, The New York Times, U.S.
News and World Report, Business Week, Forbes or Fortune. As with
other performance data, performance comparisons should not be
considered representative of the Trust's relative performance
for any future period.
What are the Sponsor's Profits?
In maintaining a market for the Units, the Sponsor will 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 6.0%)
or redeemed. The secondary market public offering price of Units
may be greater or less than the cost of such Units to the Sponsor.
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 or entity who is registered as such owner on the books
of the Trustee. Unit holders will 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
Page 17
Units are transferable by surrender to the Trustee accompanied
by a written instrument or instruments of transfer. Units to be
redeemed must be accompanied by a written instrument or instruments
of transfer. A Unit holder must sign exactly as his or her name
appears on the books of the Trustee with the signature guaranteed
by a participant in the Securities Transfer Agents Medallion Program
("STAMP") or such other signature program in addition to, or in
substitution for, STAMP, as may be accepted by the Trustee. In
certain instances the Trustee may require additional documents
such as, but not limited to, trust instruments, certificates of
death, appointments as executor or administrator or certificates
of corporate authority. Record ownership may occur before settlement.
How are Income and Capital Distributed?
The Trustee will distribute any net income (other than accreted
interest) received with respect to any of the Securities in the
Trust on or about the Distribution Dates to Unit holders of record
on the preceding Record Date. See "Summary of Essential Information"
in Part One. Proceeds received from rebated Rule 12b-1 fees or
on the sale of any Securities in the Trust, to the extent not
used to meet redemptions of Units or pay expenses, will be distributed
at least annually on each Distribution Date to Unit holders of
record on the preceding Record Date. Income with respect to the
original issue discount on the Treasury Obligations in the Trust,
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?"
The Record Date and Distribution Date were established so as to
occur shortly after the record date and the payment dates of Special
Situations. Special Situations normally pays dividends on its
net investment income annually. Net realized capital gains, if
any, will be distributed at least annually.
Within a reasonable time after the Trust is terminated, each Unit
holder will, upon surrender of his or her Units for redemption,
receive: (i) the number of shares of Special Situations attributable
to his or her Units, which will be distributed "in kind" directly
to his or her account, rather than redeemed, (ii) a pro rata share
of the amounts realized upon the disposition of the Treasury Obligations
and (iii) a pro rata share of any other assets of the Trust, less
expenses of the Trust, subject to the limitation that Treasury
Obligations may not be sold to pay for Trust expenses. Not less
than 60 days prior to the termination of the Trust, Unit holders
will be offered the option of having the proceeds from the disposition
of the Treasury Obligations in the Trust invested on the date
such proceeds become available to the Trust, in additional shares
of Special Situations at net asset value. Such shares will not
be subject to a sales charge or a contingent deferred sales load
but such shares will incur Rule 12b-1 fees as do all other shares
held directly by investors in Special Situations. Unless a Unit
holder indicates that he or she wishes to reinvest such amounts,
they will be paid in cash, as indicated above. A Unit holder may,
of course, at any time after the Special Situations shares are
distributed to his or her account, instruct Special Situations
to redeem all or a portion of the shares in his or her account.
Shares of Special Situations, as more fully described in its prospectus,
will be redeemed at the then current net asset value. If within
180 days after the termination of the Trust a registered owner
of Units has not surrendered the Units, the Trustee shall liquidate
the shares of Special Situations held for such Unit holder and
hold the funds to which such Unit holder is entitled until such
Units are surrendered.
The Trustee will credit to the Income Account of the Trust any
dividends, distributions or rebated Rule 12b-1 fees received on
the Special Situations shares therein. All other receipts (e.g.,
return of principal, etc.) are credited to the Capital Account
of the Trust.
The Trustee may establish reserves (the "Reserve Account") within
the Trust for state and local taxes, if any, and any governmental
charges payable out of the Trust.
How Can Distributions to Unit Holders be Reinvested?
Each Unit holder of the Trust will have distributions of principal,
if any, or income automatically invested in Special Situations
shares (if Units are properly registered in the name of the Unit
holder) deposited at such share's net asset value next computed,
unless he or she indicates at the time of purchase, or subsequently
notifies the Trustee in writing, that he or she wishes to receive
cash payments. Shares of Special Situations obtained through reinvestment
will not be subject to a sales charge, although such shares will
incur Rule 12b-1 fees as do all other shares held directly by
investors in Special Situations. Reinvestment
Page 18
by the Trust in Special Situations shares will normally be made
as of the distribution date of the Trust after the Trustee deducts
therefrom the expenses of the Trust.
Additional information with respect to the investment objective
and policies of Special Situations is contained in its prospectus
and SAI, which can be obtained from FIC.
Unit holders who are receiving distributions in cash may elect
to participate in the automatic reinvestment feature, subject
to meeting certain suitability requirements, by filing with the
Trustee an election to have such distributions reinvested without
a sales charge. Such election must be received by the Trustee
at least ten days prior to the Record Date applicable to any distribution
in order to be in effect for such Record Date. Any such election
shall remain in effect until a subsequent notice is received by the Trustee.
Exchange Privilege. Subject to the following limitations, shares
held in a Unit holder's reinvestment account in Special Situations
may be exchanged for shares of any other series of the Fund or
for certain other funds in the First Investors Group of Funds
without paying a sales charge. No exchanges will be accepted into
or from First Investors Special Bond Fund, Inc., First Investors
Life Series Fund, First Investors U.S. Government Plus Fund or
Executive Investors Trust. Exchanges can only be made into accounts
registered to identical owners. If your exchange is into a new
account, it must meet the minimum investment and other requirements
of the fund into which the exchange is being made. Additionally,
the fund must be available for sale in the state where you reside.
A $5.00 exchange fee is charged for each exchange. However, currently
this fee is being voluntarily borne by the fund into which you
are making the exchange, which could add to that fund's expenses.
Each fund in the First Investors Group of Funds reserves the right
to change or suspend this policy in the future. Before exchanging
Series shares for shares of another fund, you should read the
prospectus of the fund into which the exchange is to be made.
You may obtain prospectuses and information with respect to which
funds qualify for the exchange privilege free of charge by calling
Shareholder Services at 1-800-423-4026. Exchange requests may
be made in writing or by telephone (for shares held on deposit
only) if telephone privileges were elected on your application.
Exchanges should be made for investment purposes only. A pattern
of frequent exchanges may be contrary to the best interests of
the Series' other shareholders. Accordingly, the Series has the
right, at its sole discretion, to limit the amount of an exchange,
reject any exchange, or, upon 60 days' notice, materially modify
or discontinue the exchange privilege. The Series will consider
all relevant factors in determining whether a particular frequency
of exchanges is contrary to the best interests of the Series and
its other shareholders. Any such restriction will be made by the
Series on a prospective basis only, upon notice to the shareholder
not later than ten days following such shareholder's most recent
exchange. See the Series' prospectus for further information regarding
the Exchange Privilege.
What Reports Will Unit Holders Receive?
The Trustee shall furnish Unit holders in connection with each
distribution a statement of the amount of income, if any, and
the amount of other receipts, if any, which are being distributed,
expressed in each case as a dollar amount per Unit. Within a reasonable
time after the end of each calendar year, the Trustee will furnish
to each person who at any time during the calendar year was a
Unit holder of the Trust the following information in reasonable
detail: (1) a summary of transactions in the Trust for such year;
(2) any Securities sold during the year and the Securities held
at the end of such year by the Trust; (3) the redemption price
per Unit based upon a computation thereof on the 31st day of December
of such year (or the last business day prior thereto); and (4)
amounts of income and capital gains distributed during such year.
How May Units be Redeemed?
A Unit holder may redeem all or a portion of his or her Units
by tender to the Trustee at its corporate trust office in the
City of New York of a request for redemption, duly endorsed or
accompanied by proper instruments of transfer with signature guaranteed
as explained above, and payment of applicable governmental charges,
if any. No redemption fee will be charged. On the third business
day following such tender, 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 day of tender is deemed
Page 19
to be the date on which Units are received by the Trustee, except
that as regards Units received after 4:00 p.m. eastern standard
time, the date of tender is the next day on which the NYSE 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.
Any amounts paid on redemption representing income shall be withdrawn
from the Income Account of the 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 the Trust.
The Trustee is empowered to sell Securities of the Trust in order
to make funds available for redemption. To the extent that Securities
are sold, the size and diversity of the Trust will be reduced.
Such sales may be required at a time when Securities would not
otherwise be sold and might result in lower prices than might
otherwise be realized. Shares of Special Situations will be sold
to meet redemptions of Units before Treasury Obligations, although
Treasury Obligations may be sold if the Trust is assured of retaining
a sufficient principal amount of Treasury Obligations to provide
funds upon maturity of the Trust at least equal to $10.00 per Unit.
The redemption price per Unit (as well as the secondary market
Public Offering Price) will be determined on the basis of the
bid price of the Treasury Obligations and the net asset value
of the Special Situations shares in the Trust, plus or minus cash,
if any, in the Capital and Income Accounts of the Trust. The Redemption
Price per Unit 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 and the net asset value of
the Special Situations shares next computed; and (3) dividends
or other distributions receivable on Special Situations shares
trading ex-dividend as of the date of computation and amounts
accrued, if any, for rebated Rule 12b-1 fees; 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, the Supervisor and counsel 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 right of redemption may be suspended and payment postponed
for any period during which the NYSE is closed (other than for
customary weekend and holiday closings) or during which the SEC
determines that trading on the NYSE 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
SEC may by order permit. Under certain extreme circumstances,
the Sponsor may apply to the SEC 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 standard
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 or she 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.
Page 20
How May Securities be Removed from the Trust?
The portfolio of the 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
a Security in the unlikely event that an issuer of a Security
defaults in the payment of dividends or interest or there exist
certain other materially adverse conditions described in the Indenture.
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 the Trust tendered for redemption and the
payment of expenses; provided, however, that in the case of Securities
sold to meet redemption requests, Treasury Obligations may only
be sold if the Trust is assured of retaining a sufficient principal
amount of Treasury Obligations to provide funds upon maturity
of the Trust at least equal to $10.00 per Unit. Treasury Obligations
may not be sold to meet Trust expenses.
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 and The First Trust GNMA. First Trust introduced
the first insured unit investment trust in 1974 and to date more
than $9 billion in First Trust unit investment trusts have been
deposited. The Sponsor's employees include a team of professionals
with many years of experience in the unit investment trust industry.
The Sponsor is a member of the National Association of Securities
Dealers, Inc. and Securities Investor Protection Corporation and
has its principal offices at 1001 Warrenville Road, Lisle, Illinois
60532; telephone number (708) 241-4141. As of December 31, 1994,
the total partners' capital of Nike Securities L.P. was $10,863,058
(audited). (This paragraph relates only to the Sponsor and not
to the Trust or to any series thereof or to any other Underwriter.
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 The Bank of New York, a trust company organized
under the laws of New York. The Bank of New York has its offices
at 101 Barclay Street, New York, New York 10286, 1-800-221-7668.
The Bank of New York is subject to supervision and examination
by the Superintendent of Banks of the State of New York and the
Board of Governors of the Federal Reserve System, and its deposits
are insured by the Federal Deposit Insurance Corporation to the
extent permitted by law.
The 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 the 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 the 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 the 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
Page 21
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 the Trust which the Trustee may be required
to pay under any present or future law of the United States of
America or of any other taxing authority having jurisdiction.
In addition, the 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 become incapable of acting or become 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 SEC, or (b) terminate the Indenture and liquidate the Trust
as provided herein, or (c) continue to act as Trustee without
terminating the Indenture.
Who is the Evaluator?
The Evaluator is FT Evaluators L.P., an Illinois limited partnership
formed in 1994 and an affiliate of the Sponsor. The Evaluator's
address is 1001 Warrenville Road, Lisle, Illinois 60532. The Evaluator
may resign or may be removed by the Sponsor and the Trustee, in
which event the Sponsor and the Trustee are to use their best
efforts to appoint a satisfactory successor. Such resignation
or removal shall become effective upon the acceptance of appointment
by the successor Evaluator. If upon resignation of the Evaluator
no successor has accepted appointment within 30 days after notice
of resignation, the Evaluator may apply to a court of competent
jurisdiction for the appointment of a successor.
The Trustee, Sponsor and Unit holders may rely on any evaluation
furnished by the Evaluator and shall have no responsibility for
the accuracy thereof. Determinations by the Evaluator under the
Indenture shall be made in good faith upon the basis of the best
information available to it, provided, however, that the Evaluator
shall be under no liability to the Trustee, Sponsor or Unit holders
for errors in judgment. This provision shall not protect the Evaluator
in any case of willful misfeasance, bad faith, gross negligence
or reckless disregard of its obligations and duties.
OTHER INFORMATION
How May the Indenture Be Amended or Terminated?
The Sponsor and the Trustee have the power to amend the Indenture
without the consent of any of the Unit holders when such an amendment
is (1) to cure any ambiguity or to correct or supplement any provision
of the Indenture which may be defective or inconsistent with any
other provision contained therein, or (2) to make such other provisions
as shall not adversely affect the interest of the Unit holders
(as determined in good faith by the Sponsor and the Trustee).
The Indenture provides that the Trust shall terminate upon the
maturity, redemption or other disposition of the last of the Treasury
Obligations held in the Trust but in no event beyond the Mandatory
Termination Date indicated under "Summary of Essential Information"
in Part One. The Trust may be liquidated at any time by consent
of 100% of the Unit holders of the Trust or by the Trustee in
the event that Units of the 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 the Trust is liquidated
because of the redemption of unsold Units of the Trust
Page 22
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 Principal Distributed?"
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. Tanner Propp & Farber will act as counsel for the
Trustee and as special New York tax counsel for the Trust.
Experts
The financial statements of the Trust appearing in Part One of
this Prospectus and Registration Statement have been audited by
Ernst & Young LLP, independent auditors, as set forth in their
report thereon appearing elsewhere herein and in the Registration
Statement, and are included in reliance upon such report given
upon the authority of such firm as experts in accounting and auditing.
Page 23
<TABLE>
<CAPTION>
CONTENTS:
<S> <C>
First Investors Special Situations Growth & Treasury
Securities Trust
What is First Investors Special Situations Growth
& Treasury Securities Trust? 3
What are the Expenses and Charges? 3
What is the Federal Tax Status of Unit Holders? 4
Why are Investments in the Trust Suitable for
Retirement Plans? 7
Portfolio:
What are Treasury Obligations? 7
What is First Investors Special Situations Series? 7
What is Special Situations' Investment Objective
and Policies? 9
Description of Certain Securities, Other
Investment Policies and Risk Factors 11
Who is the Management of Special Situations? 12
What are Some Additional Considerations
for Investors? 15
Public Offering:
How is the Public Offering Price Determined? 15
How are Units Distributed? 16
What are the Sponsor's Profits? 17
Rights of Unit Holders:
How is Evidence of Ownership Issued
and Transferred? 17
How are Income and Capital Distributed? 18
How Can Distributions to Unit Holders
be Reinvested? 18
What Reports Will Unit Holders Receive? 19
How May Units be Redeemed? 19
How May Units be Purchased by the Sponsor? 20
How May Securities be Removed from the Trust? 21
Information as to Sponsor, Trustee and Evaluator:
Who is the Sponsor? 21
Who is the Trustee? 21
Limitations on Liabilities of Sponsor and Trustee 22
Who is the Evaluator? 22
Other Information:
How May the Indenture Be Amended
or Terminated? 22
Legal Opinions 23
Experts 23
</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 FUND HAS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION,
WASHINGTON, D.C. UNDER THE SECURITIES ACT OF 1933 AND THE INVESTMENT
COMPANY ACT OF 1940, AND TO WHICH REFERENCE IS HEREBY MADE.
First Investors
Special Situations
Growth & Treasury
Securities Trust
Prospectus
Part Two
September 25, 1995
First TrustR
1001 Warrenville Road
Suite 300
Lisle, Illinois 60532
1-708-241-4141
Trustee:
The Bank of New York
101 Barclay Street
New York, New York 10286
1-800-682-7668
THIS PART TWO MUST BE
ACCOMPANIED BY PART ONE
PLEASE RETAIN BOTH PARTS OF PROSPECTUS
FOR FUTURE REFERENCE
Page 24
CONTENTS OF POST-EFFECTIVE AMENDMENT
OF REGISTRATION STATEMENT
This Post-Effective Amendment of Registration Statement
comprises the following papers and documents:
The facing sheet
The prospectus
The signatures
The Consent of Independent Auditors
Financial Data Schedule
S-1
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant, First Investors Special Situations Growth and
Treasury Securities Trust, Series 1, certifies that it meets all
of the requirements for effectiveness of this Registration
Statement pursuant to Rule 485(b) under the Securities Act of
1933 and has duly caused this Post-Effective Amendment of its
Registration Statement to be signed on its behalf by the
undersigned thereunto duly authorized in the Village of Lisle and
State of Illinois on September 29, 1995.
FIRST INVESTORS SPECIAL SITUATIONS GROWTH
AND TREASURY SECURITIES TRUST, SERIES 1
(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 Post-Effective Amendment of Registration Statement has been
signed below by the following person in the capacity and on the
date indicated:
Signature Title Date
Robert D. Van Kampen Sole Director of )
Nike Securities )
Corporation, ) September 29, 1995
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., Depositor.
**An executed copy of the related power of attorney was filed
with the Securities and Exchange Commission in connection
with the Amendment No. 1 to Form S-6 of The First Trust
Special Situations Trust, Series 18 (File No. 33-42683) and
the same is hereby incorporated herein by this reference.
S-2
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption
"Experts" and to the use of our report dated September 1, 1995 in
this Post-Effective Amendment to the Registration Statement and
related Prospectus of First Investors Special Situations Growth &
Treasury Securities Trust dated September 22, 1995.
ERNST & YOUNG LLP
Chicago, Illinois
September 21, 1995
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information extracted from Post
Effective Amendment to Form S-6 and is qualified in its entirety by
reference to such Post Effective Amendment to Form S-6.
</LEGEND>
<SERIES>
<NUMBER> 001
<NAME> FIRST INVESTORS G&T TRUST
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> OTHER
<FISCAL-YEAR-END> MAY-31-1995
<PERIOD-START> JUN-27-1994
<PERIOD-END> MAY-31-1995
<INVESTMENTS-AT-COST> 10,799,243
<INVESTMENTS-AT-VALUE> 11,616,019
<RECEIVABLES> 0
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 11,616,019
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 6,519
<TOTAL-LIABILITIES> 6,519
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 10,799,243
<SHARES-COMMON-STOCK> 1,135,000
<SHARES-COMMON-PRIOR> 10,000
<ACCUMULATED-NII-CURRENT> (6,519)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 816,776
<NET-ASSETS> 11,609,500
<DIVIDEND-INCOME> 293,651
<INTEREST-INCOME> 361,318
<OTHER-INCOME> 0
<EXPENSES-NET> 13,492
<NET-INVESTMENT-INCOME> 641,477
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 816,776
<NET-CHANGE-FROM-OPS> 1,458,253
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 286,678
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,125,000
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 11,519,633
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
