SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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
A. Exact Name of Trust: FT 291
B. Name of Depositor: NIKE SECURITIES L.P.
C. Complete Address of Depositor's 1001 Warrenville Road
Principal Executive Offices: Lisle, Illinois 60532
D. Name and Complete Address of
Agents for Service: NIKE SECURITIES L.P.
Attention: James A. Bowen
Suite 300
1001 Warrenville Road
Lisle, Illinois 60532
CHAPMAN & CUTLER
Attention: Eric F. Fess
111 West Monroe Street
Chicago, Illinois 60606
E. Title of Securities
Being Registered: An indefinite number of
Units pursuant to Rule
24f-2 promulgated under
the Investment Company Act
of 1940, as amended.
F. Approximate Date of Proposed
Sale to the Public: ____ Check if it is
proposed that this filing
will become effective on
_____ at ____ p.m.
pursuant to Rule 487.
The registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its effective
date until the registrant shall file a further amendment which
specifically states that this Registration Statement shall
thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement
shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
FT 291
Cross-Reference Sheet
(Form N-8B-2 Items required by Instructions as
to the Prospectus in Form S-6)
FORM N-8B-2 FORM S-6
ITEM NUMBER HEADING IN PROSPECTUS
I. ORGANIZATION AND GENERAL INFORMATION
1. (a) Name of trust Prospectus front cover
(b) Title of securities issued Summary of Essential
Information
2. Name and address of each Information as to
depositor Sponsor, Trustee and
Evaluator
3. Name and address of Information as to
trustee Sponsor, Trustee and
Evaluator
4. Name and address of Underwriting
principal underwriters
5. State of organization The FT Series
of trust
6. Execution and termination The FT Series; Other
of trust agreement Information
7. Changes of name *
8. Fiscal Year *
9. Litigation *
II. GENERAL DESCRIPTION OF THE TRUST AND SECURITIES OF THE TRUST
10. (a) Registered or bearer Rights of Unit Holders
securities
(b) Cumulative or distributive
securities The FT Series
(c) Redemption Rights of Unit Holders
(d) Conversion, transfer, etc. Rights of Unit Holders
(e) Periodic payment plan
certificates *
(f) Voting rights Rights of Unit Holders;
Other Information
(g) Notice of certificate- Rights of Unit Holders;
holders Other Information
(h) Consents required Rights of Unit Holders;
Other Information
(i) Other provisions The FT Series
11. Types of securities comprising The FT Series
12. Certain information
regarding periodic payment
plan certificates *
13. (a) Load, fees, expenses, etc. Summary of Essential
Information; Public
Offering; The FT Series
(b) Certain information
regarding periodic payment
plan certificates *
(c) Certain percentages Summary of Essential
Information; The FT
Series; Public Offering
(d) Difference in price offered Public Offering
for any class of transactions
to any class or group of
individuals
(e) Certain other load fees, Rights of Unit Holders
expenses, etc. payable by
holders
(f) Certain profits receivable The FT Series
by depositor, principal
underwriters, trustee or
affiliated persons
(g) Ratio of annual charges to
income *
14. Issuance of trust's Rights of Unit Holders
securities
15. Receipt and handling of
payments from purchasers *
16. Acquisition and disposition
of underlying securities The FT Series; Rights of
Unit Holders
17. Withdrawal or redemption The FT Series; Public
Offering; Rights of Unit
Holders
18. (a) Receipt, custody and
disposition of income Rights of Unit Holders
(b) Reinvestment of
distributions Rights of Unit Holders
(c) Reserves or special funds Information as to
Sponsor, Trustee and
Evaluator
(d) Schedule of distributions *
19. Records, accounts and
reports Rights of Unit Holders
20. Certain miscellaneous
provisions of trust
agreement
(a) Amendment Other Information
(b) Termination Other Information
(c) and (d) Trustee, removal and
successor Information as to
Sponsor, Trustee and
Evaluator
(e) and (f) Depositor, removal Information as to
and successor Sponsor, Trustee and
Evaluator
21. Loans to security holders *
22. Limitations on liability The FT Series;
Information as to
Sponsor, Trustee and
Evaluator
23. Bonding arrangements Contents of Registration
Statement
24. Other material provisions
of trust agreement *
III. ORGANIZATION, PERSONNEL AND AFFILIATED PERSONS OF DEPOSITOR
25. Organization of depositor Information as to
Sponsor, Trustee and
Evaluator
26. Fees received by depositor *
27. Business of depositor Information as to
Sponsor, Trustee and
Evaluator
28. Certain information as to *
officials and affiliated
persons of depositor
29. Voting securities of *
depositor
30. Persons controlling *
depositor
31. Payment by depositor for *
certain services rendered
to trust
32. Payment by depositor for *
certain other services
rendered to trust
33. Remuneration of other *
persons for certain
services rendered to trust
34. Remuneration of other *
persons for certain services
rendered to trust
IV. DISTRIBUTION AND REDEMPTION
35. Distribution of trust's
securities by states Public Offering
36. Suspension of sales of
trust's securities *
37. Revocation of authority
to distribute *
38. (a) Method of distribution Public Offering
(b) Underwriting agreements Public Offering;
Underwriting
(c) Selling agreements Public Offering
39. (a) Organization of principal Information as to
underwriters Sponsor, Trustee and
Evaluator
(b) N.A.S.D. membership of Information as to
principal underwriters Sponsor, Trustee and
Evaluator
40. Certain fee received by See Items 13(a) and 13(e)
principal underwriters
41. (a) Business of principal Information as to
underwriters Sponsor, Trustee and
Evaluator
(b) Branch offices of
principal underwriters *
(c) Salesmen of principal
underwriters *
42. Ownership of trust's
securities by certain
persons *
43. Certain brokerage
commissions received
by principal underwriters *
44. (a) Method of valuation Summary of Essential
Information; The FT
Series; Public Offering
(b) Schedule as to offering
price *
(c) Variation in offering Public Offering
price to certain persons
45. Suspension of redemption
rights *
46. (a) Redemption Valuation Rights of Unit Holders
(b) Schedule as to redemption
price *
47. Maintenance of position Public Offering; Rights
in underlying securities of Unit Holders
V. INFORMATION CONCERNING THE TRUSTEE OR CUSTODIAN
48. Organization and regulation Information as to
of trustee Sponsor, Trustee and
Evaluator
49. Fees and expenses of trustee The FT Series
50. Trustee's lien The FT Series
VI. INFORMATION CONCERNING THE INSURANCE OF HOLDERS OR
SECURITIES
51. Insurance of holders of *
trust's securities
VII. POLICY OF REGISTRANT
52. (a) Provisions of trust The FT Series; Rights
agreement with respect of Unit Holders
to selection or elimination
of underlying securities
(b) Transactions involving
elimination of underlying
securities *
(c) Policy regarding The FT Series; Rights
substitution or elimination of Unit Holders
of underlying securities
(d) Fundamental policy not
otherwise covered *
53. Tax status of Trust The FT Series
VIII. FINANCIAL AND STATISTICAL INFORMATION
54. Trust's securities during
last ten years *
55. Certain information regarding
periodic payment plan
certificates
56. Certain information regarding
periodic payment plan
certificates
57. Certain information regarding *
periodic payment plan
certificates
58. Certain information regarding
periodic payment plan
certificates
59. Financial statements Report of Independent
(Instruction 1(b) to Auditors; Statement of
Form S-6) Net Assets
__________________________
* Inapplicable, answer negative or not required.
SUBJECT TO COMPLETION, DATED SEPTEMBER 22, 1998
AS AMENDED OCTOBER 6, 1998
America's Leading Brands Growth Trust, Series 4
Auto & Transportation Growth Trust Series
Communications Growth Trust, Series 3
Internet Growth Trust, Series 5
Regional Bank & Thrift Growth Trust, Series 2
The Trusts. FT 291 consists of the underlying separate unit investment
trusts set forth above. The various trusts are sometimes collectively
referred to herein as the "Trusts" and individually as a "Trust."
The objective of each Trust is to provide for potential capital
appreciation by investing the Trust's portfolio in common stocks (the
"Equity Securities") of companies represented by each Trust's specific
sector or investment focus. See "Schedule of Investments" for each
Trust. Each Trust has a mandatory termination date ("Mandatory
Termination Date" or "Trust Ending Date") as set forth under "Summary of
Essential Information" for each Trust. There is, of course, no guarantee
that the objective of the Trusts will be achieved.
Each Unit of a Trust represents an undivided fractional interest in all
the Equity Securities deposited in such Trust. The Equity Securities
deposited in each Trust's portfolio have no fixed maturity date and the
value of these underlying Equity Securities will fluctuate with changes
in the values of stocks in general. See "Portfolio."
The Sponsor may, from time to time during a period of up to
approximately 360 days after the Initial Date of Deposit, deposit
additional Equity Securities or cash (including a letter of credit) with
instructions to purchase additional Equity Securities in the Trusts.
Such deposits of additional Equity Securities will be done in such a
manner that the original proportionate relationship amongst the
individual issues of the Equity Securities in each Trust shall be
maintained. Any deposit by the Sponsor of additional Equity Securities,
or the purchase of additional Equity Securities pursuant to a cash
deposit, will duplicate, as nearly as is practicable, the original
proportionate relationship established on the Initial Date of Deposit,
and not the actual proportionate relationship on the subsequent date of
deposit, since the two may differ. Any such difference may be due to the
sale, redemption or liquidation of any Equity Securities deposited in
the Trusts on the Initial, or any subsequent, Date of Deposit. See "What
is the FT Series?" and "Rights of Unit Holders-How May Equity Securities
be Removed from a Trust?"
Public Offering Price. The Public Offering Price per Unit of each Trust
during the initial offering period is equal to the aggregate underlying
value of the Equity Securities in such Trust (generally determined by
the closing sale prices of listed Equity Securities and the ask prices
of over-the-counter traded Equity Securities) plus or minus a pro rata
share of cash, if any, in the Capital and Income Accounts of such
Trust, plus an initial sales charge equal to the difference between the
maximum sales charge of ___% of the Public
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH
THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD
NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION
STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN
OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE
ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER,
SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR
QUALIFICATION UNDER THE SECURITIES LAWS OF ANY STATE.
First Trust (registered trademark)
1-800-621-9533
The date of this Prospectus is ____________, 1998
Page 1
Offering Price and the maximum remaining deferred sales charge,
initially $____ per Unit. Commencing on ______, 1999, and on the
twentieth day of each month thereafter (or if such date is not a
business day, on the preceding business day) through ______, 1999, a
deferred sales charge of $____ will be assessed per Unit per month.
Units purchased subsequent to the initial deferred sales charge payment
but still during the initial offering period will be subject to the
initial sales charge and the remaining deferred sales charge payments
not yet collected. The deferred sales charge will be paid from funds in
the Income and/or Capital Accounts, if sufficient, or from the periodic
sale of Equity Securities. The total maximum sales charge assessed to
Unit holders on a per Unit basis will be ___% of the Public Offering
Price (equivalent to ___% of the net amount invested, exclusive of the
deferred sales charge). A pro rata share of accumulated dividends, if
any, in the Income Account of a Trust is included in the Public Offering
Price. In addition, a portion of the Public Offering Price on Units
purchased prior to the earlier of six months after the Initial Date of
Deposit or the end of the initial offering period also consists of
Equity Securities in an amount sufficient to pay for all or a portion of
the costs incurred in establishing the Trusts. The organizational and
offering costs will be deducted from the assets of each Trust as of the
earlier of six months after the Initial Date of Deposit or the end of
the initial offering period. Upon completion of the deferred sales
charge period, the secondary market Public Offering Price per Unit for a
Trust will not include deferred payments, but will instead include only
a one-time initial sales charge of ___% of the Public Offering Price
(equivalent to ____% of the net amount invested), which will be reduced
by 1/2 of 1% on each ________, commencing ______, 1999 to a minimum
sales charge of ____%. The minimum amount which an investor may purchase
of a Trust is $1,000 ($500 for Individual Retirement Accounts or other
retirement plans). The sales charge of a Trust is reduced on a graduated
scale for sales involving at least $50,000. See "Public Offering-How is
the Public Offering Price Determined?"
UNITS OF THE TRUSTS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY, ANY BANK, AND UNITS ARE NOT FEDERALLY INSURED OR OTHERWISE PROTECTED
BY THE FEDERAL DEPOSIT INSURANCE CORPORATION AND INVOLVE INVESTMENT RISK
INCLUDING LOSS OF PRINCIPAL.
Dividend and Capital Distributions. Distributions of dividends and
capital, if any, received by a Trust, net of expenses of such Trust,
will be paid on the Distribution Date to Unit holders of record on the
Record Date as set forth in the "Summary of Essential Information" for
each Trust. Distributions of funds in the Capital Account, if any, will
be made at least annually in December of each year. Any distribution of
income and/or capital will be net of the expenses of the respective
Trust. See "What is the Federal Tax Status of Unit Holders?" Unit
holders may elect to have distributions of income or capital, or both,
reinvested into additional Units of the Trust subject only to any
remaining deferred sales charge. Additionally, upon termination of the
Trusts, the Trustee will distribute, upon surrender of Units for
redemption, to each Unit holder his or her pro rata share of a Trust's
assets, less expenses, in the manner set forth under "Rights of Unit
Holders-How are Income and Capital Distributed?"
Secondary Market for Units. After the initial offering period, while
under no obligation to do so, the Sponsor intends to maintain a market
for Units of the Trusts and offer to repurchase such Units at prices
which are based on the aggregate underlying value of Equity Securities
in such Trusts (generally determined by the closing sale prices of
listed Equity Securities and the bid prices of over-the-counter traded
Equity Securities) plus or minus cash, if any, in the Capital and Income
Accounts of such Trusts. If a secondary market is maintained during the
initial offering period, the prices at which Units will be repurchased
will also be based upon the aggregate underlying value of the Equity
Securities in the Trusts (generally determined by the closing sale
prices of listed Equity Securities and the ask prices of over-the-
counter traded Equity Securities) plus or minus cash, if any, in the
Capital and Income Accounts of such Trusts. If a secondary market is not
maintained, a Unit holder may redeem Units through redemption at prices
based upon the aggregate underlying value of the Equity Securities in a
Trust (generally determined by the closing sale prices of listed Equity
Securities and either the ask prices (during the initial offering
period) or the bid prices (subsequent to the initial offering period) of
over-the-counter traded Equity Securities) plus or minus a pro rata
share of cash, if any, in the Capital and Income Accounts of a Trust. A
Unit holder tendering 1,000 Units or more of a Trust for redemption may
request a distribution of shares of Equity Securities (reduced by
customary transfer and registration charges) (an "In-Kind Distribution")
Page 2
in lieu of payment in cash. See "Rights of Unit Holders-How May Units be
Redeemed?" Any deferred sales charge remaining on Units at the time of
their sale or redemption will be collected at that time. See "Rights of
Unit Holders-How May Units be Redeemed?"
Termination. Commencing no later than the Mandatory Termination Date,
Equity Securities will begin to be sold as prescribed by the Sponsor.
The Trustee will provide written notice of any termination of the Trusts
to Unit holders which will specify when Unit holders may surrender their
certificates for cancellation and will include with such notice a form
to enable Unit holders to elect an In-Kind Distribution if such Unit
holder owns at least 1,000 Units of a Trust, rather than to receive
payment in cash for such Unit holder's pro rata share of the amounts
realized upon the disposition by the Trustee of Equity Securities. To be
effective, the election form, together with surrendered certificates and
other documentation required by the Trustee, must be returned to the
Trustee at least ten business days prior to the Mandatory Termination
Date. Unit holders not electing a distribution of shares of Equity
Securities will receive a cash distribution within a reasonable time
after a Trust is terminated. See "Rights of Unit Holders-How are Income
and Capital Distributed?" and "Other Information-How May the Indenture
be Amended or Terminated?"
Risk Factors. An investment in a Trust should be made with an
understanding of the risks associated therewith, including, among other
factors, the possible deterioration of either the financial condition of
the issuers of the Equity Securities or the general condition of the
stock market, changes in interest rates and economic recession.
Volatility in the market price of the Equity Securities in a Trust also
changes the value of the Units of the Trusts. Unit holders tendering
Units for redemption during periods of market volatility may receive
redemption proceeds which are more or less than they paid for the Units.
The Trusts' portfolios are not managed and Equity Securities will not be
sold by the Trusts regardless of market fluctuations, although certain
Equity Securities may be sold under certain limited circumstances. For
further information concerning these risk factors as well as a
discussion of additional risks specific to each Trust, see "What are the
Equity Securities?-Risk Factors."
Page 3
Summary of Essential Information
At the Opening of Business on the Initial Date of Deposit
of the Equity Securities-____________, 1998
Sponsor: Nike Securities L.P.
Trustee: The Chase Manhattan Bank
Evaluator: First Trust Advisors L.P.
America's
Leading Transportation Communications
Brands Growth Growth Trust Growth Trust
General Information Trust, Series 4 Series Series 3
_______________ ______________ ______________
Initial Number of Units (1)
Fractional Undivided Interest in the Trust per Unit (1) 1/ 1/ 1/
Public Offering Price:
Aggregate Offering Price Evaluation of Equity Securities
in Portfolio (2) $ $ $
Aggregate Offering Price Evaluation of Equity Securities per Unit $ $ $
Maximum Sales Charge of ___% of the Public Offering Price
per Unit (___% of the net amount invested, exclusive
of the deferred sales charge) (3) $ $ $
Less Deferred Sales Charge per Unit $( ) $( ) $( )
Public Offering Price per Unit (3) $ $ $
Sponsor's Initial Repurchase Price per Unit (4) $ $ $
Redemption Price per Unit (based on aggregate underlying
value of Equity Securities less deferred sales charge) (4) $ $ $
Cash CUSIP Number
Reinvestment CUSIP Number
Security Code
Trustee's Annual Fee per Unit outstanding $ $ $
Evaluator's Annual Fee per Unit outstanding (5) $ $ $
Maximum Supervisory Fee per Unit outstanding (6) $ $ $
Estimated Organizational and Offering Costs per Unit (7) $ $ $
First Settlement Date ______, 1998
Mandatory Termination Date ______, 2003
Discretionary Liquidation Amount A Trust may be terminated if the value thereof is less than the lower of
$2,000,000 or 20% of the total value of Equity Securities deposited in such
Trust during the initial offering period.
Income Distribution Record Date Fifteenth day of each June and December commencing ______, 1998.
Income Distribution Date (8) Last day of each June and December commencing ______, 1998.
_____________
<FN>
(1) As of the close of business on the Initial Date of Deposit, the
number of Units of a Trust may be adjusted so that the Public Offering
Price per Unit will equal approximately $10.00. Therefore, to the extent
of any such adjustment, the fractional undivided interest per Unit will
increase or decrease accordingly, from the amounts indicated above.
(2) Each listed Equity Security is valued at the last closing sale price,
or if no such price exists or if the Equity Security is not so listed,
at the closing ask price thereof.
(3) The maximum sales charge consists of an initial sales charge and a
deferred sales charge. See "Fee Table" and "Public Offering" for
additional information regarding these charges. On the Initial Date of
Deposit there will be no accumulated dividends in the Income Account.
Anyone ordering Units after such date will pay a pro rata share of any
accumulated dividends in such Income Account. The Public Offering Price
as shown reflects the value of the Equity Securities at the opening of
business on the Initial Date of Deposit and establishes the original
proportionate relationship amongst the individual securities. No sales
to investors will be executed at this price. Additional Equity
Securities will be deposited during the day of the Initial Date of
Deposit which will be valued as of 4:00 p.m. Eastern time and sold to
investors at a Public Offering Price per Unit based on this valuation.
(4) The Sponsor's Initial Repurchase Price per Unit and the Redemption
Price per Unit set forth above and until the earlier of six months after
the Initial Date of Deposit or the end of the initial offering period
include estimated organizational and offering costs per Unit. After such
date, the Sponsor's Repurchase Price and Redemption Price per Unit will
not include such estimated organizational and offering costs. See
"Rights of Unit Holders-How May Units be Redeemed?"
(5) The Evaluator's Fee is payable to an affiliate of the Sponsor.
Evaluations for purposes of sale, purchase or redemption of Units are
made as of the close of trading (generally 4:00 p.m. Eastern time) on
the New York Stock Exchange on each day on which it is open.
(6) The Supervisory Fee is payable to an affiliate of the Sponsor. In
addition, the Sponsor will be reimbursed for bookkeeping and other
administrative expenses currently at a maximum annual rate of $.0028 per
Unit per Trust.
(7) Investors will bear all or a portion of the costs incurred in
organizing a Trust (including costs of preparing the registration
statement, the Trust indenture and other closing documents, registering
Units with the Securities and Exchange Commission and states, the
initial audit of a Trust portfolio, legal fees and the initial fees and
expenses of the Trustee but not including the expenses incurred in the
printing of preliminary and final prospectuses, and expenses incurred in
the preparation and printing of brochures and other advertising
materials and any other selling expenses). Estimated organizational and
offering costs are included in the Public Offering Price per Unit and
will be deducted from the assets of a Trust at the earlier of six months
after the Initial Date of Deposit or the end of the initial offering
period. See "Public Offering" and "Statements of Net Assets."
(8) Distributions from the Capital Account will be made monthly payable
on the last day of the month to Unit holders of record on the fifteenth
day of such month if the amount available for distribution equals at
least $1.00 per 100 Units. Notwithstanding, distributions of funds in
the Capital Account, if any, will be made in December of each year.
</FN>
Page 4
Summary of Essential Information
At the Opening of Business on the Initial Date of Deposit
of the Equity Securities-____________, 1998
Sponsor: Nike Securities L.P.
Trustee: The Chase Manhattan Bank
Evaluator: First Trust Advisors L.P.
Regional
Internet Bank & Thrift
Growth Trust Growth Trust
General Information Series 5 Series 2
____________ ____________
Initial Number of Units (1)
Fractional Undivided Interest in the Trust per Unit (1) 1/ 1/
Public Offering Price:
Aggregate Offering Price Evaluation of Equity Securities
in Portfolio (2) $ $
Aggregate Offering Price Evaluation of Equity Securities per Unit $ $
Maximum Sales Charge of ___% of the Public Offering Price per
Unit (___% of the net amount invested, exclusive
of the deferred sales charge) (3) $ $
Less Deferred Sales Charge per Unit $( ) $( )
Public Offering Price per Unit (3) $ $
Sponsor's Initial Repurchase Price per Unit (4) $ $
Redemption Price per Unit (based on aggregate underlying
value of Equity Securities less deferred sales charge) (4) $ $
Cash CUSIP Number
Reinvestment CUSIP Number
Security Code
Trustee's Annual Fee per Unit outstanding $ $
Evaluator's Annual Fee per Unit outstanding (5) $ $
Maximum Supervisory Fee per Unit outstanding (6) $ $
Estimated Organizational and Offering Costs per Unit (7) $ $
First Settlement Date ______, 1998
Mandatory Termination Date ______, 2003
Discretionary Liquidation Amount A Trust may be terminated if the value thereof is less than the lower of
$2,000,000 or 20% of the total value of Equity Securities deposited in such
Trust during the initial offering period.
Income Distribution Record Date Fifteenth day of each June and December commencing ______, 1998.
Income Distribution Date (8) Last day of each June and December commencing ______, 1998.
______________
<FN>
(1) As of the close of business on the Initial Date of Deposit, the
number of Units of a Trust may be adjusted so that the Public Offering
Price per Unit will equal approximately $10.00. Therefore, to the extent
of any such adjustment, the fractional undivided interest per Unit will
increase or decrease accordingly, from the amounts indicated above.
(2) Each listed Equity Security is valued at the last closing sale price,
or if no such price exists or if the Equity Security is not so listed,
at the closing ask price thereof.
(3) The maximum sales charge consists of an initial sales charge and a
deferred sales charge. See "Fee Table" and "Public Offering" for
additional information regarding these charges. On the Initial Date of
Deposit there will be no accumulated dividends in the Income Account.
Anyone ordering Units after such date will pay a pro rata share of any
accumulated dividends in such Income Account. The Public Offering Price
as shown reflects the value of the Equity Securities at the opening of
business on the Initial Date of Deposit and establishes the original
proportionate relationship amongst the individual securities. No sales
to investors will be executed at this price. Additional Equity
Securities will be deposited during the day of the Initial Date of
Deposit which will be valued as of 4:00 p.m. Eastern time and sold to
investors at a Public Offering Price per Unit based on this valuation.
(4) The Sponsor's Initial Repurchase Price per Unit and the Redemption
Price per Unit set forth above and until the earlier of six months after
the Initial Date of Deposit or the end of the initial offering period
include estimated organizational and offering costs per Unit. After such
date, the Sponsor's Repurchase Price and Redemption Price per Unit will
not include such estimated organizational and offering costs. See
"Rights of Unit Holders-How May Units be Redeemed?"
(5) The Evaluator's Fee is payable to an affiliate of the Sponsor.
Evaluations for purposes of sale, purchase or redemption of Units are
made as of the close of trading (generally 4:00 p.m. Eastern time) on
the New York Stock Exchange on each day on which it is open.
(6) The Supervisory Fee is payable to an affiliate of the Sponsor. In
addition, the Sponsor will be reimbursed for bookkeeping and other
administrative expenses currently at a maximum annual rate of $.0028 per
Unit per Trust.
(7) Each Trust (and therefore Unit holders) will bear all or a portion of
its organizational and offering costs (including costs of preparing
Investors will bear all or a portion of the costs incurred in organizing
a Trust (including costs of preparing the registration statement, the
Trust indenture and other closing documents, registering Units with the
Securities and Exchange Commission and states, the initial audit of a
Trust portfolio, legal fees and the initial fees and expenses of the
Trustee but not including the expenses incurred in the printing of
preliminary and final prospectuses, and expenses incurred in the
preparation and printing of brochures and other advertising materials
and any other selling expenses). Estimated organizational and offering
costs are included in the Public Offering Price per Unit and will be
deducted from the assets of a Trust at the earlier of six months after
the Initial Date of Deposit or the end of the initial offering period.
See "Public Offering" and "Statements of Net Assets."
(8) Distributions from the Capital Account will be made monthly payable
on the last day of the month to Unit holders of record on the fifteenth
day of such month if the amount available for distribution equals at
least $1.00 per 100 Units. Notwithstanding, distributions of funds in
the Capital Account, if any, will be made in December of each year.
</FN>
Page 5
FEE TABLES
These Fee Tables are intended to help you to understand the costs and
expenses that you will bear directly or indirectly. See "Public
Offering" and "What are the Expenses and Charges?" Although the Trusts
have a term of approximately five years and are unit investment trusts
rather than mutual funds, this information is presented to permit a
comparison of fees.
America's Leading Auto & Communications
Brands Growth Transportation Growth trust
Trust, Series 4 Growth Trust Series Trust, Series 3
_________________ ___________________ _______________
Unit Holder Transaction Expenses
Initial sales charge imposed on purchase
(as a percentage of public offering price) %(a) $ %(a) $ %(a) $
Deferred sales charge
(as a percentage of public offering price) %(b) %(b) %(b)
____ ___ ___ ___ ___ ___
% $ % $ % $
=== === === === === ===
Maximum Sales Charge imposed on Reinvested Dividends %(c) $ %(c) $ %(c) $
=== === === === === ===
Organizational and Offering Costs
Estimated Organizational and Offering Costs
(as a percentage of public offering price) %(d) $ %(d) $ %(d) $
=== === === === === ===
Estimated Annual Trust Operating Expenses
(as a percentage of average net assets)
Trustee's fee % $ % $ % $
Portfolio supervision, bookkeeping, administrative
and evaluation fees % % %
Other operating expenses % % %
___ ___ ___ ___ ___ ___
Total % $ % $ % $
=== === === === === ===
Internet Growth Trust Regional Bank & Thrift
Series 5 Growth Trust, Series 2
_____________________ ______________________
Unit Holder Transaction Expenses
Initial sales charge imposed on purchase
(as a percentage of public offering price) %(a) $ %(a) $
Deferred sales charge
(as a percentage of public offering price) %(b) %(b)
___ ___ ___ ___
% $ % $
=== === === ===
Maximum Sales Charge imposed on Reinvested Dividends %(c) $ %(c) $
Organizational and Offering Costs
Estimated Organizational and Offering Costs
(as a percentage of public offering price) %(d) $ %(d) $
=== === === ===
Estimated Annual Trust Operating Expenses
(as a percentage of average net assets)
Trustee's fee % $ % $
Portfolio supervision, bookkeeping, administrative
and evaluation fees % %
Other operating expenses % %
___ ___ ___ ___
Total % $ % $
=== === === ===
Page 6
Examples
________
CUMULATIVE EXPENSES PAID
America's Leading
Brands Growth Auto & Transportation Communications
Trust, Series 4 Growth Trust Series Growth Trust, Series 3
_______________________ ______________________ ______________________
1 Year 3 Years 5 Years 1 Year 3 Years 5 Years 1 Year 3 Years 5 Years
An investor would pay the following expenses
on a $1,000 investment, assuming the Trust
has an estimated operating expense ratio of
% and a 5% annual return on the
investment throughout the periods $ $ $ $ $ $ $ $ $
Internet Growth Trust Regional Bank & Thrift
Series 5 Growth Trust, Series 2
_____________________ _________________________
1 Year 3 Years 5 Years 1 Year 3 Years 5 Years
$ $ $ $ $ $
The examples assume reinvestment of all dividends and distributions and
utilize a 5% annual rate of return as mandated by Securities and
Exchange Commission regulations applicable to mutual funds. For purposes
of the examples, the deferred sales charge imposed on reinvestment of
dividends is not reflected until the year following payment of the
dividend; the cumulative expenses would be higher if sales charges on
reinvested dividends were reflected in the year of reinvestment. The
examples should not be considered a representation of past or future
expenses or annual rate of return; the actual expenses and annual rate
of return may be more or less than those assumed for purposes of the
examples.
______________
<FN>
(a) The Initial Sales Charge is actually the difference between the
maximum total sales charge of ___% and the maximum remaining deferred
sales charge (initially $____ per Unit) and would exceed 1.0% if the
Public Offering Price exceeds $10.00 per Unit.
(b) The actual fee is $____ per month per Unit, irrespective of purchase
or redemption price deducted monthly commencing ______, 1999 through
______, 1999. If a Unit holder sells or redeems Units before all of
these deductions have been made, the balance of the deferred sales
charge payments remaining will be deducted from the sales or redemption
proceeds. If the Unit price exceeds $10.00 per Unit, the deferred sales
charge will be less than ____%. Units purchased subsequent to the
initial deferred sales charge payment will also be subject to the
remaining deferred sales charge payments not yet collected.
(c) Reinvested Dividends will be subject only to the deferred sales
charge remaining at the time of reinvestment. See "Rights of Unit
Holders-How are Income and Capital Distributed?"
(d) Investors will bear all or a portion of the costs incurred in
organizing the Trusts (including costs of preparing the registration
statement, the Trust indenture, and other closing documents, registering
Units with the Securities and Exchange Commission and states, the
initial audit of the Trust portfolio, legal fees and the initial fees
and expenses of the Trustee). Estimated organizational and offering
costs are included in the Public Offering Price per Unit and will be
deducted from the assets of a Trust at the earlier of six months after
the Initial Date of Deposit or the end of the initial offering period.
</FN>
Page 7
AMERICA'S LEADING BRANDS GROWTH TRUST, SERIES 4
AUTO & TRANSPORTATION GROWTH TRUST SERIES
COMMUNICATIONS GROWTH TRUST, SERIES 3
INTERNET GROWTH TRUST, SERIES 5
REGIONAL BANK & THRIFT GROWTH TRUST, SERIES 2
FT 291
What is the FT Series?
FT 291 is one of a series of investment companies created by the Sponsor
under the name of the FT Series, all of which are generally similar, but
each of which is separate and is designated by a different series
number. The FT Series was previously known as The First Trust Special
Situations Trust Series. This Series consists of the underlying separate
unit investment trusts set forth above. The Trusts were 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 Chase Manhattan Bank as Trustee, and First Trust
Advisors L.P. as Portfolio Supervisor and Evaluator.
On the Initial Date of Deposit, the Sponsor deposited with the Trustee
confirmations of contracts for the purchase of common stocks (the
"Equity Securities"), together with an irrevocable letter or letters of
credit of a financial institution in an amount at least equal to the
purchase price of such securities. In exchange for the deposit of
securities or contracts to purchase securities in the Trusts, the
Trustee delivered to the Sponsor documents evidencing the entire
ownership of the Trusts.
America's Leading Brands Growth Trust, Series 4
The objective of the America's Leading Brands Growth Trust, Series 4
(the "America's Leading Brands Growth Trust") is to provide investors
with the potential for above-average capital appreciation through an
investment in a diversified portfolio of common stocks of companies
considered to be leaders in their industries. See "Schedule of
Investments" for the America's Leading Brands Growth Trust.
The Trust consists of a portfolio of companies involved in the consumer
goods industry. This type of diversification can help offset risk,
although it does not eliminate it entirely. Furthermore, to achieve this
type of diversification on your own would require substantial time and
capital commitments.
Almost every American is familiar with brand name companies like "Coca-
Cola," "Walt Disney," "Gillette" and "McDonald's." They are household
names, and their products can be found in almost every home across the
country. Increasingly, such companies are becoming household names
overseas as well. Many of these companies already have a strong presence
in international markets; and they stand to benefit even more from the
increasing demands of growing populations, rising standards of living,
more relaxed foreign trade agreements, and improved political climates
in many countries around the world. In addition, leading brands
companies have large advertising budgets, as well as strong research and
development areas which enable them to further expand into new markets.
Furthermore, these companies have strong financial positions and market
dominance, competitive advantages, skilled management, and essential
products and services. Generally, consumer goods companies with these
attributes perform strongly, even during uncertain economic times.
In addition, the Sponsor believes that employing a "buy and hold"
philosophy encourages investors to be disciplined and patient while
looking at the future prospects of the companies, rather than focusing
on short-term performance.
See "Schedule of Investments" and "What are the Equity Securities?-Risk
Factors" for the America's Leading Brands Growth Trust. There is,
however, no assurance that the objective of the America's Leading Brands
Growth Trust will be achieved.
Auto & Transportation Growth Trust Series
The objective of the Auto & Transportation Growth Trust Series (the
"Auto & Transportation Growth Trust") is to provide investors with the
potential for above-average capital appreciation through an investment
in a diversified portfolio of common stocks issued by companies in the
air freight, airlines, motor vehicles, parts and accessories, railroads,
and trucking industries.
The auto and transportation industries have undergone significant
changes as a result of deregulation, consolidation, cost-cutting and
management changes, which allowed the industries to thrive. The Sponsor
Page 8
believes the changes in these industries, combined with attractive
valuations and improving fundamentals, have created a unique opportunity
for investors seeking above-average growth potential, and the following
factors support the Sponsor's positive outlook for companies in the auto
and transportation industries:
The companies included in the portfolio trade at attractive price to
earnings ratios relative to their future earnings growth prospects.
Companies in this sector may benefit from a strong U.S. economy as well
as from the potential for a rebound in overseas countries.
Companies in the auto and transportation industries have enhanced their
earnings potential by greatly improving their operating efficiencies
through capital investments, cost reductions and a better use of capital.
In general, the Sponsor believes these companies have above-average
growth prospects for sales and earnings, established market shares for
their products and services, and lower than average debt. In addition,
the Sponsor believes that employing a "buy and hold" philosophy
encourages investors to be disciplined and patient while looking at the
future prospects of the companies, rather than focusing on short-term
performance.
See "Schedule of Investments" and "What are the Equity Securities?-Risk
Factors" for the Auto & Transportation Growth Trust Series. There is,
however, no assurance that the objective of the Auto & Transportation
Growth Trust Series will be achieved.
Communications Growth Trust, Series 3
The objective of the Communications Growth Trust, Series 3 (the
"Communications Growth Trust") is to provide investors with the
potential for above-average capital appreciation through an investment
in a diversified portfolio of common stocks of communications companies
which the Sponsor believes are positioned to take advantage of the
convergence of many types of communications around the world. The
Communications Growth Trust's portfolio is diversified across domestic
and international companies involved in cable tv, computer networking,
communications equipment, communications services and wireless
communications. A diversified portfolio helps to offset the risks
normally associated with such an investment, although it does not
eliminate them entirely. The companies selected for the Communications
Growth Trust have been researched and evaluated using database screening
techniques, fundamental analysis and the judgment of the Sponsor's
research analysts. In general, the Sponsor believes these companies have
above-average growth prospects for sales and earnings, established
market shares for their services and lower-than-average levels of debt.
In addition, the Sponsor believes that employing a "buy and hold"
philosophy encourages investors to be disciplined and patient while
looking at the future prospects of the companies, rather than focusing
on short-term performance.
In the Sponsor's opinion, the communications industry is expected to
benefit from the convergence of a variety of industries including
entertainment, media and publishing. Companies well-positioned within
the communications industry are poised for both increased revenue and
earnings growth potential over the next several years. The
Telecommunications Act of 1996 broke down many regulatory barriers in
the United States, making it possible for companies once precluded from
offering multiple communication services to now do so. Cable companies,
for instance, can now offer telephone services while telephone companies
can offer video services. Increased competition and opportunities will
arise as telephone companies are able to offer both long-distance and
local services. Foreign markets are opening at a rapid pace. In fact, 69
countries representing more than 90% of world telecommunications revenue
recently signed an agreement to move to deregulation and privatization.
This worldwide deregulation is likely to accelerate global demand for
communications services. Due to the fast pace of technological advances,
domestic and global demand for communications services and equipment is
increasing. Recent advances, such as wireless phones, fiber optics and
the Internet, are allowing businesses, individuals and governments
greater access to a variety of communications services at lower costs.
This increased access, in turn, is fueling the demand for products from
manufacturers of communications equipment and computer networks. In
addition, future technological advances will only serve to further
reduce communications-related costs and to stimulate demand.
See "Schedule of Investments" and "What are the Equity Securities?-Risk
Page 9
Factors" for the Communications Growth Trust. There is, however, no
assurance that the objective of the Communications Growth Trust will be
achieved.
Internet Growth Trust, Series 5
The objective of the Internet Growth Trust, Series 5 (the "Internet
Growth Trust") is to provide for the potential for above-average capital
appreciation through an investment in a diversified portfolio of common
stocks of U.S.-based companies the Sponsor believes are ideally
positioned to take advantage of the rapid growth of the Internet. The
portfolio of the Internet Growth Trust is diversified across many
related sectors: computer networking, communications equipment, wireless
communications and communications services. Diversifying a portfolio
helps to offset the risks normally associated with equity investments,
although risk cannot be entirely eliminated. This type of
diversification provides a convenient, efficient way for the investor to
own stocks in a number of companies without considerable time and
capital commitments.
In the Sponsor's opinion, the growing numbers of users and web sites
along with expanding capabilities make the Internet Growth Trust an
attractive investment opportunity. More than 58 million adults are on-
line in the United States alone, and the number of on-line users is
expected to dramatically increase in the future. In fact, a new computer
is added to the Internet approximately every four seconds, and nearly
3,000 new websites are being added every day. Rising standards of living
and more disposable income worldwide, combined with faster, more
efficient and affordable technology will dramatically expand the
potential number of users. In addition, improved security measures are
helping to increase the number of consumer transactions over the web.
Corporations have made huge strides in the way they conduct business-to-
business transactions over the Internet, making it more commercially
feasible for the mass market. Business-to-business electronic commerce
is anticipated to exceed $20 billion by 2000, up from an estimated $9.5
billion in 1997. Consolidation and mergers among companies involved with
the Internet are increasing. Technological improvement like high-speed
data and video transmission through cable connections are helping to
fuel this growth. Overall, new technologies are accepted more rapidly
than ever. In fact, while it took 35 years for one-quarter of U.S.
households to own a telephone, the Internet reached the same level of
penetration in only seven years. All of these factors lead the Sponsor
to believe the companies selected for the portfolio stand to benefit
from the combination of increased demand, faster and more efficient
services, and more affordable equipment.
The companies selected for the Internet Growth Trust have been
researched and evaluated using database screening techniques,
fundamental analysis, and the judgment of the Sponsor's research
analysts. To help reduce risk, the Internet Growth Trust avoids small
companies, newly-issued stocks, and stocks with little or no earnings.
In general, the Sponsor believes the companies selected have above-
average growth prospects for sales and earnings, established market
shares for their services, and lower than average debt. In addition, the
Sponsor believes that employing a "buy and hold" philosophy encourages
investors to be disciplined and patient while looking at the future
prospects of the companies, rather than focusing on short-term
performance.
The Sponsor believes that the enormous growth potential of the Internet
offers a compelling investment opportunity. However, since the Internet
is in the early stages of its development and the direction of its
evolution is unpredictable, tremendous risks exist. It is important to
note that companies engaged in business related to the Internet are
subject to fierce competition and their products and services may be
subject to rapid obsolescence.
See "Schedule of Investments" and "What are the Equity Securities?-Risk
Factors" for the Internet Growth Trust. There is, however, no assurance
that the objective of the Internet Growth Trust will be achieved.
Regional Bank & Thrift Growth Trust, Series 2
The objective of the Regional Bank & Thrift Growth Trust, Series 2 (the
"Regional Bank & Thrift Growth Trust") is to provide investors with the
potential for above-average capital appreciation through an investment
in a diversified portfolio of common stocks of companies in the bank and
thrift industry.
Recent changes in interstate banking laws have expanded the industry's
ability to consolidate, generating a wave of takeovers and mergers. The
Sponsor believes the consolidation activity, along with attractive
valuations, and improving fundamentals within the industry, have created
a unique opportunity for investors seeking above-average growth
Page 10
potential. The following factors support the Sponsor's positive outlook
for companies in the bank and thrift industry:
Despite consistent earnings growth, on average the companies included in
the portfolio trade at below-market price to earnings ratios.
Companies in this sector are poised to benefit from strong and improving
fundamentals as both businesses and consumers increase their levels of
borrowing as a result of low interest rates.
The bank and thrift industry continues to experience significant
consolidation as larger institutions acquire smaller banks and thrifts.
Therefore, the overall number of banks and thrifts has been steadily
declining. The Sponsor believes greater distribution, geographic and
product diversification, and less competition in a given market are the
primary factors favoring continued consolidation activity. Investors may
benefit from takeover premiums if the companies in the Trust are acquired.
In general, the Sponsor believes the companies selected for the Trust
have above-average growth prospects for sales and earnings, established
market shares for their services, and lower than average debt. In
addition, the Sponsor believes that employing a "buy and hold"
philosophy encourages investors to be disciplined and patient while
looking at the future prospects of the companies, rather than focusing
on short-term performance.
See "Schedule of Investments" and "What are the Equity Securities?-Risk
Factors" for the Regional Bank & Thrift Growth Trust. There is, however,
no assurance that the objective of the Regional Bank & Thrift Growth
Trust will be achieved.
With the deposit of the Equity Securities on the Initial Date of
Deposit, the Sponsor established a percentage relationship between the
amounts of Equity Securities in each Trust's portfolio, as set forth
under "Schedule of Investments" for each Trust. From time to time
following the Initial Date of Deposit, the Sponsor, pursuant to the
Indenture, may create additional Units in a Trust by depositing
additional Equity Securities or cash (including a letter of credit) with
instructions to purchase additional Equity Securities in a Trust. Units
may be continuously offered for sale to the public by means of this
Prospectus, resulting in a potential increase in the outstanding number
of Units of a Trust. Any deposit by the Sponsor of additional Equity
Securities, or the purchase of additional Equity Securities pursuant to
a cash deposit, will duplicate, as nearly as is practicable, the
original proportionate relationship and not the actual proportionate
relationship on the subsequent date of deposit, since the two may
differ. Any such difference may be due to the sale, redemption or
liquidation of any of the Equity Securities deposited in a Trust on the
Initial, or any subsequent, Date of Deposit. See "Rights of Unit Holders-
How May Equity Securities be Removed from a Trust?" Since the prices of
the underlying Equity Securities will fluctuate daily, the ratio, on a
market value basis, will also change daily. The portion of Equity
Securities represented by each Unit will not change as a result of the
deposit of additional Equity Securities in a Trust. If the Sponsor
deposits cash, however, existing and new investors may experience a
dilution of their investment and a reduction in their anticipated income
because of fluctuations in the prices of the Equity Securities between
the time of the cash deposit and the purchase of the Equity Securities
and because such Trust will pay the associated brokerage fees. To
minimize this effect, the Trusts will try to purchase the Equity
Securities as close to the evaluation time as possible. The Trustee may,
from time to time, retain and pay compensation to the Sponsor (or an
affiliate of the Sponsor) to act as agent for a Trust with respect to
acquiring Equity Securities for a Trust. In acting in such capacity, the
Sponsor or its affiliate will be subject to the restrictions under the
Investment Company Act of 1940, as amended.
On the Initial Date of Deposit, each Unit of a Trust represented the
undivided fractional interest in the Equity Securities deposited in such
Trust set forth under "Summary of Essential Information" for each Trust.
To the extent that Units of a Trust are redeemed, the aggregate value of
the Equity Securities in such Trust will be reduced and the undivided
fractional interest represented by each outstanding Unit of that Trust
will increase. However, if additional Units are issued by a Trust in
connection with the deposit of additional Equity Securities or cash by
the Sponsor, the aggregate value of the Equity Securities in that Trust
will be increased by amounts allocable to additional Units, and the
fractional undivided interest represented by each Unit of that Trust
will be decreased proportionately. See "Rights of Unit Holders-How May
Units be Redeemed?"
Page 11
What are the Expenses and Charges?
With the exception of brokerage fees discussed above and bookkeeping and
other administrative services provided to each Trust, for which the
Sponsor will be reimbursed in amounts as set forth under "Summary of
Essential Information," the Sponsor will not receive any fees in
connection with its activities relating to a Trust.
First Trust Advisors L.P., an affiliate of the Sponsor, will receive an
annual supervisory fee, which is not to exceed the amount set forth
under "Summary of Essential Information," for providing portfolio
supervisory services for each Trust. Such fee is based on the number of
Units outstanding in a Trust on January 1 of each year except for the
year or years in which an initial offering period occurs in which case
the fee for a month is based on the number of Units outstanding at the
end of such month. In providing such supervisory services, the Portfolio
Supervisor may purchase research services from a variety of sources
which may include dealers of the Trusts.
Subsequent to the initial offering period, First Trust Advisors L.P., in
its capacity as the Evaluator for the Trusts, will receive a fee as
indicated in the "Summary of Essential Information."
The Trustee pays certain expenses of each Trust for which it is
reimbursed by such Trust. The Trustee will receive for its ordinary
recurring services to each Trust an annual fee set forth in each
"Summary of Essential Information." Such fee is based upon the largest
aggregate number of Units of each Trust outstanding during the calendar
year, except during the initial offering period, in which case the fee
is calculated based on the largest number of Units outstanding during
the period for which compensation is paid. For a discussion of the
services performed by the Trustee pursuant to its obligations under the
Indenture, reference is made to the material set forth under "Rights of
Unit Holders."
The Trustee's and the above described fees are payable from the Income
Account of a Trust to the extent funds are available and then from the
Capital Account of such Trust. Since the Trustee has the use of the
funds being held in the Capital and Income Accounts for payment of
expenses and redemptions and since such Accounts are noninterest-bearing
to Unit holders, the Trustee benefits thereby. Part of the Trustee's
compensation for its services to each Trust is expected to result from
the use of these funds.
Each of the above mentioned 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. In addition,
with respect to the fees payable to the Sponsor or an affiliate of the
Sponsor for providing bookkeeping and other administrative services,
supervisor services and evaluation services, such individual fees may
exceed the actual costs of providing such services for a Trust, but at
no time will the total amount received for such services rendered to all
unit investment trusts of which Nike Securities L.P. is the Sponsor in
any calendar year exceed the actual cost to the Sponsor or its affiliate
of supplying such services in such year.
The following additional charges are or may be incurred by a Trust: all
legal and annual auditing expenses of the Trustee incurred by or in
connection with its responsibilities under the Indenture; the expenses
and costs of any action undertaken by the Trustee to protect a Trust and
the rights and interests of the Unit holders; fees of the Trustee for
any extraordinary services performed under the Indenture;
indemnification of the Trustee for any loss, liability or expense
incurred by it without negligence, bad faith or willful misconduct on
its part, arising out of or in connection with its acceptance or
administration of a Trust; any offering costs incurred after the earlier
of six months after the Initial Date of Deposit or the end of the
initial offering period; indemnification of the Sponsor for any loss,
liability or expense incurred without gross negligence, bad faith or
willful misconduct in acting as Depositor of such Trust; all taxes and
other government charges imposed upon the Securities or any part of a
Trust (no such taxes or charges are being levied or made or, to the
knowledge of the Sponsor, contemplated). The above expenses and the
Trustee's annual fee, when paid or owing to the Trustee, are secured by
a lien on each Trust. In addition, the Trustee is empowered to sell
Equity Securities in a Trust in order to make funds available to pay all
these amounts if funds are not otherwise available in the Income and
Capital Accounts of such Trust. Since the Equity Securities are all
common stocks and the income stream produced by dividend payments is
unpredictable, the Sponsor cannot provide any assurance that dividends
Page 12
will be sufficient to meet any or all expenses of a Trust. As described
above, if dividends are insufficient to cover expenses, it is likely
that Equity Securities will have to be sold to meet such 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 each Trust to be audited on an annual basis at
the expense of such Trusts 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 $0.0050 per Unit. Unit holders of a Trust
covered by an audit may obtain a copy of the audited financial
statements upon request.
What is the Federal Tax Status of Unit Holders?
This is a general discussion of certain of the Federal income tax
consequences of the purchase, ownership and disposition of the Units.
The summary is limited to investors who hold the Units as "capital
assets" (generally, property held for investment) within the meaning of
Section 1221 of the Internal Revenue Code of 1986 (the "Code"). Unit
holders should consult their tax advisors in determining the Federal,
state, local and any other tax consequences of the purchase, ownership
and disposition of Units in the Trusts. For purposes of the following
discussion and opinion, it is assumed that each Equity Security is
equity for Federal income tax purposes.
In the opinion of Chapman and Cutler, special counsel for the Sponsor,
under existing law:
1. Each Trust is not an association taxable as a corporation for
Federal income tax purposes; each Unit holder will be treated as the
owner of a pro rata portion of each of the assets of a Trust under the
Code; and the income of each Trust will be treated as income of the Unit
holders thereof under the Code. Each Unit holder will be considered to
have received his or her pro rata share of the income derived from each
Equity Security when such income is considered to be received by a Trust.
2. Each Unit holder will be considered to have received all of the
dividends paid on his or her pro rata portion of each Equity Security
when such dividends are considered to be received by a Trust regardless
of whether such dividends are used to pay a portion of the deferred
sales charge. Unit holders will be taxed in this manner regardless of
whether distributions from such Trust are actually received by the Unit
holder.
3. Each Unit holder will have a taxable event when a Trust disposes of
an Equity Security (whether by sale, taxable exchange, liquidation,
redemption, or otherwise) or upon the sale or redemption of Units by
such Unit holder (except to the extent an In-Kind distribution of stocks
is received by such Unit holder as described below). The price a Unit
holder pays for his or her Units, generally including sales charges, is
allocated among his or her pro rata portion of each Equity Security held
by a Trust (in proportion to the fair market values thereof on the
valuation date closest to the date the Unit holder purchases his or her
Units) in order to determine the tax basis for his or her pro rata
portion of each Equity Security held by such Trust. Unit holders should
consult their own tax advisors with regard to calculation of basis. For
Federal income tax purposes, a Unit holder's pro rata portion of
dividends, as defined by Section 316 of the Code, paid by a corporation
with respect to an Equity Security held by a Trust is taxable as
ordinary income to the extent of such corporation's current and
accumulated "earnings and profits." A Unit holder's pro rata portion of
dividends paid on such Equity Security which exceed such current and
accumulated earnings and profits will first reduce a Unit holder's tax
basis in such Equity Security, and to the extent that such dividends
exceed a Unit holder's tax basis in such Equity Security shall generally
be treated as capital gain. In general, the holding period for such
capital gain will be determined by the period of time a Unit holder has
held his or her Units.
4. A Unit holder's portion of gain, if any, upon the sale or
redemption of Units or the disposition of Equity Securities held by a
Trust will generally be considered a capital gain (except in the case of
a dealer or a financial institution). A Unit holder's portion of loss,
if any, upon the sale or redemption of Units or the disposition of
Equity Securities held by a Trust will generally be considered a capital
loss (except in the case of a dealer or a financial institution). Unit
holders should consult their tax advisors regarding the recognition of
such capital gains and losses for Federal income tax purposes.
Page 13
Deferred Sales Charge. Generally, the tax basis of a Unit holder
includes sales charges, and such charges are not deductible. A portion
of the sales charge for the Trusts is deferred. It is possible that for
Federal income tax purposes a portion of the deferred sales charge may
be treated as interest which would be deductible by a Unit holder
subject to limitations on the deduction of investment interest. In such
a case, the non-interest portion of the deferred sales charge should be
added to the Unit holder's tax basis in his or her Units. The deferred
sales charge could cause the Unit holder's Units to be considered to be
debt-financed under Section 246A of the Code which would result in a
small reduction of the dividends-received deduction. In any case, the
income (or proceeds from redemption) a Unit holder must take into
account for federal income tax purposes is not reduced by amounts
deducted to pay the deferred sales charge. Unit holders should consult
their own tax advisors as to the income tax consequences of the deferred
sales charge.
Dividends Received Deduction. A corporation that owns Units will
generally be entitled to a 70% dividends received deduction with respect
to such Unit holder's pro rata portion of dividends received by a Trust
(to the extent such dividends are taxable as ordinary income, as
discussed above, and are attributable to domestic corporations) in the
same manner as if such corporation directly owned the Equity Securities
paying such dividends (other than corporate Unit holders, such as "S"
corporations, which are not eligible for the deduction because of their
special characteristics and other than for purposes of special taxes
such as the accumulated earnings tax and the personal holding
corporation tax). However, a corporation owning Units should be aware
that Sections 246 and 246A of the Code impose additional limitations on
the eligibility of dividends for the 70% dividends received deduction.
These limitations include a requirement that stock (and therefore Units)
must generally be held at least 46 days (as determined under Section
246(c) of the Code). Final regulations have been issued which address
special rules that must be considered in determining whether the 46-day
holding period requirement is met. Moreover, the allowable percentage of
the deduction will be reduced from 70% if a corporate Unit holder owns
certain stock (or Units) the financing of which is directly attributable
to indebtedness incurred by such corporation.
To the extent dividends received by a Trust are attributable to foreign
corporations, a corporation that owns Units will not be entitled to the
dividends received deduction with respect to its pro rata portion of
such dividends, since the dividends received deduction is generally
available only with respect to dividends paid by domestic corporations.
It should be noted that various legislative proposals that would affect
the dividends received deduction have been introduced. Unit holders
should consult with their tax advisors with respect to the limitations
on and possible modifications to the dividends received deduction.
Limitations on Deductibility of a Trust's Expenses by Unit Holders. Each
Unit holder's pro rata share of each expense paid by a Trust is
deductible by the Unit holder to the same extent as though the expense
had been paid directly by such Unit holder. It should be noted that as a
result of the Tax Reform Act of 1986, certain miscellaneous itemized
deductions, such as investment expenses, tax return preparation fees and
employee business expenses will be deductible by an individual only to
the extent they exceed 2% of such individual's adjusted gross income.
Unit holders may be required to treat some or all of the expenses of a
Trust as miscellaneous itemized deductions subject to this limitation.
Unit holders should consult with their tax advisors regarding the
limitations on the deductibility of Trust expenses.
Recognition of Taxable Gain or Loss Upon Disposition of Securities by a
Trust or Disposition of Units. As discussed above, a Unit holder may
recognize taxable gain (or loss) when an Equity Security is disposed of
by a Trust or if the Unit holder disposes of a Unit. The Internal
Revenue Service Restructuring and Reform Act of 1998 (the "1998 Tax
Act") provides that for taxpayers other than corporations, net capital
gain (which is defined as net long-term capital gain over net short-term
capital loss for the taxable year) realized from property (with certain
exclusions) is subject to a maximum marginal stated tax rate of 20% (10%
in the case of certain taxpayers in the lowest tax bracket). Capital
gain or loss is long-term if the holding period for the asset is more
than one year, and is short-term if the holding period for the asset is
one year or less. The date on which a Unit is acquired (i.e., the "trade
date") is excluded for purposes of determining the holding period of the
Unit. The legislation is generally effective retroactively for amounts
properly taken into account on or after January 1, 1998. Capital gains
realized from assets held for one year or less are taxed at the same
rates as ordinary income.
Page 14
In addition, please note that capital gains may be recharacterized as
ordinary income in the case of certain financial transactions that are
considered "conversion transactions" effective for transactions entered
into after April 30, 1993. Unit holders and prospective investors should
consult with their tax advisors regarding the potential effect of this
provision on their investment in Units.
If the Unit holder disposes of a Unit, he or she is deemed thereby to
have disposed of his or her entire pro rata interest in all assets of
the Trust involved, including his or her pro rata portion of all the
Equity Securities represented by the Unit.
The Taxpayer Relief Act of 1997 (the "1997 Act") includes provisions
that treat certain transactions designed to reduce or eliminate risk of
loss and opportunities for gain (e.g., short sales, offsetting notional
principal contracts, futures or forward contracts or similar
transactions) as constructive sales for purposes of recognition of gain
(but not loss) and for purposes of determining the holding period. Unit
holders should consult their own tax advisors with regard to any
constructive sale rules.
Special Tax Consequences of In-Kind Distributions Upon Redemption of
Units or Termination of a Trust. As discussed in "Rights of Unit Holders-
How are Income and Capital Distributed?", under certain circumstances a
Unit holder who owns at least 1,000 Units of a Trust may request an In-
Kind Distribution upon the redemption of Units or the termination of a
Trust. The Unit holder requesting an In-Kind Distribution will be liable
for expenses related thereto (the "Distribution Expenses") and the
amount of such In-Kind Distribution will be reduced by the amount of the
Distribution Expenses. See "Rights of Unit Holders-How are Income and
Capital Distributed?" As previously discussed, prior to the redemption
of Units or the termination of a Trust, a Unit holder is considered as
owning a pro rata portion of each of a Trust's assets for Federal income
tax purposes. The receipt of an In-Kind Distribution will result in a
Unit holder receiving an undivided interest in whole shares of stock
plus, possibly, cash.
The potential tax consequences that may occur under an In-Kind
Distribution with respect to each Equity Security owned by a Trust will
depend on whether or not a Unit holder receives cash in addition to
Equity Securities. An "Equity Security" for this purpose is a particular
class of stock issued by a particular corporation. A Unit holder will
not recognize gain or loss if a Unit holder only receives Equity
Securities in exchange for his or her pro rata portion in the Equity
Securities held by a Trust. However, if a Unit holder also receives cash
in exchange for a fractional share of an Equity Security held by a
Trust, such Unit holder will generally recognize gain or loss based upon
the difference between the amount of cash received by the Unit holder
and his or her tax basis in such fractional share of an Equity Security
held by such Trust.
Because a Trust will own many Equity Securities, a Unit holder who
requests an In-Kind Distribution will have to analyze the tax
consequences with respect to each Equity Security owned by a Trust. The
amount of taxable gain (or loss) recognized upon such exchange will
generally equal the sum of the gain (or loss) recognized under the rules
described above by such Unit holder with respect to each Equity Security
owned by a Trust. Unit holders who request an In-Kind Distribution are
advised to consult their tax advisors in this regard.
Computation of the Unit Holder's Tax Basis. Initially, a Unit holder's
tax basis in his or her Units will generally equal the price paid by
such Unit holder for his or her Units. The cost of the Units is
allocated among the Equity Securities held in a Trust in accordance with
the proportion of the fair market values of such Equity Securities as of
the valuation date nearest the date the Units are purchased in order to
determine such Unit holder's tax basis for his or her pro rata portion
of each Equity Security.
A Unit holder's tax basis in his or her Units and his or her pro rata
portion of an Equity Security held by a Trust will be reduced to the
extent dividends paid with respect to such Equity Security are received
by a Trust which are not taxable as ordinary income as described above.
General. Each Unit holder will be requested to provide the Unit holder's
taxpayer identification number to the Trustee and to certify that the
Unit holder has not been notified that payments to the Unit holder are
subject to back-up withholding. If the proper taxpayer identification
number and appropriate certification are not provided when requested,
distributions by a Trust to such Unit holder (including amounts received
upon the redemption of Units) will be subject to back-up withholding.
Distributions by a Trust (other than those that are not treated as
United States source income, if any) will generally be subject to United
Page 15
States income taxation and withholding in the case of Units held by non-
resident alien individuals, foreign corporations or other non-United
States persons. Such persons should consult their tax advisors.
In general, income that is not effectively connected to the conduct of a
trade or business within the United States that is earned by non-U.S.
Unit holders and derived from dividends of foreign corporations will not
be subject to U.S. withholding tax provided that less than 25 percent of
the gross income of the foreign corporation for a three-year period
ending with the close of its taxable year preceding payment was not
effectively connected to the conduct of a trade or business within the
United States. In addition, such earnings may be exempt from U.S.
withholding pursuant to a specific treaty between the United States and
a foreign country. Non-U.S. Unit holders should consult their own tax
advisors regarding the imposition of U.S. withholding on distributions
from the Trusts.
It should be noted that payments to the Trusts of dividends on Equity
Securities that are attributable to foreign corporations may be subject
to foreign withholding taxes and Unit holders should consult their tax
advisors regarding the potential tax consequences relating to the
payment of any such withholding taxes by the Trusts. Any dividends
withheld as a result thereof will nevertheless be treated as income to
the Unit holders. Because, under the grantor trust rules, an investor is
deemed to have paid directly his or her share of foreign taxes that have
been paid or accrued, if any, an investor may be entitled to a foreign
tax credit or deduction for United States purposes with respect to such
taxes. The 1997 Act imposes a required holding period for such credits.
Investors should consult their tax advisors with respect to foreign
withholding taxes and foreign tax credits.
At the termination of a Trust, the Trustee will furnish to each Unit
holder a statement containing information relating to the dividends
received by the particular Trust on the Equity Securities, the gross
proceeds received by such Trust from the disposition of any Equity
Security (resulting from redemption or the sale of any Equity Security)
and the fees and expenses paid by the Trust. The Trustee will also
furnish annual information returns to Unit holders and to the Internal
Revenue Service.
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 "Are Investments in the Trusts Eligible for
Retirement Plans?"
In the opinion of Carter, Ledyard & Milburn, Special Counsel to the
Trusts for New York tax matters, under the existing income tax laws of
the State of New York, each Trust is not an association taxable as a
corporation and the income of such Trusts will be treated as the income
of the Unit holders thereof.
The foregoing discussion relates only to the tax treatment of U.S. Unit
holders ("U.S. Unit holders") with regard to United States Federal and
certain aspects of New York State and City income taxes. Unit holders
may be subject to taxation in New York or in other jurisdictions and
should consult their own tax advisors in this regard. As used herein,
the term "U.S. Unit holder" means an owner of a Unit in the Trusts that
(a) is (i) for United States federal income tax purposes a citizen or
resident of the United States, (ii) a corporation, partnership or other
entity created or organized in or under the laws of the United States or
of any political subdivision thereof, or (iii) an estate or trust the
income of which is subject to United States federal income taxation
regardless of its source or (b) does not qualify as a U.S. Unit holder
in paragraph (a) but whose income from a Unit is effectively connected
with such Unit holder's conduct of a United States trade or business.
The term also includes certain former citizens of the United States
whose income and gain on the Units will be taxable. Unit holders should
consult their tax advisors regarding potential foreign, state or local
taxation with respect to the Units.
Are Investments in the Trusts Eligible for Retirement Plans?
Units of the Trusts are eligible for purchase by Individual Retirement
Accounts, Keogh Plans, pension funds and other tax-deferred retirement
plans. Generally, the Federal income tax relating to capital gains and
income received in each of the foregoing plans is deferred until
distributions are received. Distributions from such plans are generally
treated as ordinary income but may, in some cases, be eligible for
special averaging or tax-deferred rollover treatment. Investors
considering participation in any such plan should review specific tax
laws related thereto and should consult their attorneys or tax advisors
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.
Page 16
PORTFOLIO
What are the Equity Securities?
The Trusts consist of different issues of Equity Securities which are
listed on a national securities exchange or The Nasdaq Stock Market or
traded in the over-the-counter market. See "What are the Equity
Securities Selected for America's Leading Brands Growth Trust, Series
4?," "What are the Equity Securities Selected for Auto & Transportation
Growth Trust Series?," "What are the Equity Securities Selected for
Communications Growth Trust, Series 3?," "What are the Equity Securities
Selected for Internet Growth Trust, Series 5?" and "What are the Equity
Securities Selected for Regional Bank & Thrift Growth Trust, Series 2?"
for a general description of the companies.
Risk Factors. An investment in Units of the Trusts should be made with
an understanding of the problems and risks such an investment may entail.
America's Leading Brands Growth Trust, Series 4. An investment in Units
of the America's Leading Brands Growth Trust should be made with an
understanding of the problems and risks inherent in an investment in the
consumer products industry in general. These include the cyclicality of
revenues and earnings, changing consumer demands, regulatory
restrictions, product liability litigation and other litigation
resulting from accidents, extensive competition (including that of low-
cost foreign competition), unfunded pension fund liabilities and
employee and retiree benefit costs and financial deterioration resulting
from leveraged buy-outs, takeovers or acquisitions. In general,
expenditures on consumer products will be affected by the economic
health of consumers. A weak economy with its consequent effect on
consumer spending would have an adverse effect on the industry. Other
factors of particular relevance to the profitability of the industry are
the effects of increasing environmental regulation on packaging and on
waste disposal, the continuing need to conform with foreign regulations
governing packaging and the environment, the outcome of trade
negotiations and the effect on foreign subsidies and tariffs, foreign
exchange rates, the price of oil and its effect on energy costs,
inventory cutbacks by retailers, transportation and distribution costs,
health concerns relating to the consumption of certain products, the
effect of demographics on consumer demand, the availability and cost of
raw materials and the ongoing need to develop new products and to
improve productivity.
Auto & Transportation Growth Trust Series. An investment in Units of the
Auto & Transportation Growth Trust should be made with an understanding
of the problems and risks such an investment may entail.
Government authorities impose a variety of regulations on auto and
transportation companies. These regulations address issues such as
driver/pilot qualifications, safety standards, rates, routes, vehicle
maintenance and operational standards. Any change or increase in
regulations could negatively impact the operating results of these
companies. As many governments increasingly focus on environmental
issues, transportation companies could also face increased costs
associated with complying with reduced emissions requirements or
environmental cleanup. On the other hand, any future deregulation could
result in increased competition, which could limit profitability within
the industry.
The earnings of auto and transportation companies are highly dependent
on the price and availability of fuel. A significant increase in the
price of fuel could negatively impact these companies. Auto and
transportation companies can face significant liabilities resulting from
accidents which injure passengers or damage cargo or other property.
While companies may be insured against these liabilities, any accident
could have a significantly negative impact on a company. Many auto and
transportation companies have been subject to seasonal trends due to
customer demands. These companies may exhibit especially strong results
during certain seasons of the year, but may also exhibit especially weak
results during others. In addition, the United States government is a
significant customer of many aerospace companies. As a result, these
companies may be particularly dependent on congressional appropriations,
administrative allotment of funds and changes in government policies
that may reflect military and political developments.
Communications Growth Trust, Series 3. An investment in Units of the
Communications Growth Trust should be made with an understanding of the
problems and risks such an investment may entail.
The market for high-technology communications products and services is
characterized by rapidly changing technology, rapid product
obsolescence, cyclical market patterns, evolving industry standards and
Page 17
frequent new product introductions. The success of the issuers of the
Equity Securities depends in substantial part on the timely and
successful introduction of new products and services. An unexpected
change in one or more of the technologies affecting an issuer's products
or in the market for products based on a particular technology could
have a material adverse affect on an issuer's operating results.
Furthermore, there can be no assurance that the issuers of the Equity
Securities will be able to respond in a timely manner to compete in the
rapidly developing marketplace.
The communications industry is subject to governmental regulation.
However, as market forces develop, the government will continue to
deregulate the communications industry, promoting vigorous economic
competition and resulting in the rapid development of new communications
technologies. The products and services of communications companies may
be subject to rapid obsolescence. These factors could affect the value
of the Trust's Units. For example, while telephone companies in the
United States are subject to both state and federal regulations
affecting permitted rates of returns and the kinds of services that may
be offered, the prohibition against phone companies delivering video
services has been lifted. This creates competition between phone
companies and cable operators and encourages phone companies to
modernize their communications infrastructure. Certain types of
companies represented in the Trust's portfolio are engaged in fierce
competition for a share of the market of their products. As a result,
competitive pressures are intense and the stocks are subject to rapid
price volatility.
Many communications companies rely on a combination of patents,
copyrights, trademarks and trade secret laws to establish and protect
their proprietary rights in their products and technologies. There can
be no assurance that the steps taken by the issuers of the Equity
Securities to protect their proprietary rights will be adequate to
prevent misappropriation of their technology or that competitors will
not independently develop technologies that are substantially equivalent
or superior to such issuers' technology.
Internet Growth Trust, Series 5. An investment in Units of the Internet
Growth Trust should be made with an understanding of the problems and
risks inherent in the technology sector in general.
Technology companies generally include companies involved in the
development, design, manufacture and sale of computers, computer-related
equipment, computer networks, communications systems, telecommunications
products, electronic products and other related products, systems and
services. The market for these products, especially those specifically
related to the Internet, is characterized by rapidly changing
technology, rapid product obsolescence, cyclical market patterns,
evolving industry standards and frequent new product introductions. The
success of the issuers of the Equity Securities depends in substantial
part on the timely and successful introduction of new products. An
unexpected change in one or more of the technologies affecting an
issuer's products or in the market for products based on a particular
technology could have a material adverse affect on an issuer's operating
results. Furthermore, there can be no assurance that the issuers of the
Equity Securities will be able to respond in a timely manner to compete
in the rapidly developing marketplace.
Based on trading history of technology stocks, factors such as
announcements of new products or development of new technologies and
general conditions of the industry have caused and are likely to cause
the market price of high-technology common stocks to fluctuate
substantially. In addition, technology company stocks have experienced
extreme price and volume fluctuations that often have been unrelated to
the operating performance of such companies. This market volatility may
adversely affect the market price of the Equity Securities and therefore
the ability of a Unit holder to redeem Units at a price equal to or
greater than the original price paid for such Units.
Some key components of certain products of technology issuers are
currently available only from single sources. There can be no assurance
that in the future suppliers will be able to meet the demand for
components in a timely and cost effective manner. Accordingly, an
issuer's operating results and customer relationships could be adversely
affected by either an increase in price for, or an interruption or
reduction in supply of, any key components. Additionally, many
technology issuers are characterized by a highly concentrated customer
base consisting of a limited number of large customers who may require
product vendors to comply with rigorous industry standards. Any failure
to comply with such standards may result in a significant loss or
reduction of sales. Because many products and technologies of technology
companies are incorporated into other related products, such companies
Page 18
are often highly dependent on the performance of the personal computer,
electronics and telecommunications industries. There can be no assurance
that these customers will place additional orders, or that an issuer of
Equity Securities will obtain orders of similar magnitude as past orders
from other customers. Similarly, the success of certain technology
companies is tied to a relatively small concentration of products or
technologies. Accordingly, a decline in demand of such products,
technologies or from such customers could have a material adverse impact
on issuers of the Equity Securities.
Many technology companies rely on a combination of patents, copyrights,
trademarks and trade secret laws to establish and protect their
proprietary rights in their products and technologies. There can be no
assurance that the steps taken by the issuers of the Equity Securities
to protect their proprietary rights will be adequate to prevent
misappropriation of their technology or that competitors will not
independently develop technologies that are substantially equivalent or
superior to such issuers' technology. In addition, due to the increasing
public use of the Internet, it is possible that other laws and
regulations may be adopted to address issues such as privacy, pricing,
characteristics, and quality of Internet products and services. For
example, recent proposals would prohibit the distribution of obscene,
lascivious or indecent communications on the Internet. The adoption of
any such laws could have a material adverse impact on the securities in
the Trust.
Regional Bank & Thrift Growth Trust Series 2. An investment in Units of
the Regional Bank & Thrift Growth Trust should be made with an
understanding of the problems and risks associated with an investment in
the bank and thrift industry in general.
Banks, thrifts and their holding companies are especially subject to the
adverse effects of economic recession, volatile interest rates,
portfolio concentrations in geographic markets and in commercial and
residential real estate loans, and competition from new entrants in
their fields of business. Banks and thrifts are highly dependent on net
interest margin. Recently, bank profits have come under pressure as net
interest margins have contracted, but volume gains have been strong in
both commercial and consumer products. There is no certainty that such
conditions will continue. Bank and thrift institutions had received
significant consumer mortgage fee income as a result of activity in
mortgage and refinance markets. As initial home purchasing and
refinancing activity subsided, this income diminished. Economic
conditions in the real estate markets, which have been weak in the past,
can have a substantial effect upon banks and thrifts because they
generally have a portion of their assets invested in loans secured by
real estate. Banks, thrifts and their holding companies are subject to
extensive federal regulation and, when such institutions are state-
chartered, to state regulation as well. Such regulations impose strict
capital requirements and limitations on the nature and extent of
business activities that banks and thrifts may pursue. Furthermore, bank
regulators have a wide range of discretion in connection with their
supervisory and enforcement authority and may substantially restrict the
permissible activities of a particular institution if deemed to pose
significant risks to the soundness of such institution or the safety of
the federal deposit insurance fund. Regulatory actions, such as
increases in the minimum capital requirements applicable to banks and
thrifts and increases in deposit insurance premiums required to be paid
by banks and thrifts to the Federal Deposit Insurance Corporation
("FDIC"), can negatively impact earnings and the ability of a company to
pay dividends. Neither federal insurance of deposits nor governmental
regulations, however, insures the solvency or profitability of banks or
their holding companies, or insures against any risk of investment in
the securities issued by such institutions.
The statutory requirements applicable to and regulatory supervision of
banks, thrifts and their holding companies have increased significantly
and have undergone substantial change in recent years. To a great
extent, these changes are embodied in the Financial Institutions Reform,
Recovery and Enforcement Act; enacted in August 1989, the Federal
Deposit Insurance Corporation Improvement Act of 1991, the Resolution
Trust Corporation Refinancing, Restructuring, and Improvement Act of
1991 and the regulations promulgated under these laws. Many of the
regulations promulgated pursuant to these laws have only recently been
finalized and their impact on the business, financial condition and
prospects of the Equity Securities in the Trust's portfolio cannot be
predicted with certainty. Periodic efforts by recent Administrations to
introduce legislation broadening the ability of banks to compete with
new products have not been successful, but if enacted could lead to more
failures as a result of increased competition and added risks. Failure
Page 19
to enact such legislation, on the other hand, may lead to declining
earnings and an inability to compete with unregulated financial
institutions. Efforts to expand the ability of federal thrifts to branch
on an interstate basis have been initially successful through
promulgation of regulations, and legislation to liberalize interstate
banking has recently been signed into law. Under the legislation, banks
will be able to purchase or establish subsidiary banks in any state, one
year after the legislation's enactment. Starting in mid-1997, banks
would be allowed to turn existing banks into branches, though states
could pass laws to permit interstate branch banking before then.
Consolidation is likely to continue in both cases. The Securities and
Exchange Commission and the Financial Accounting Standards Board require
the expanded use of market value accounting by banks and have imposed
rules requiring market accounting for investment securities held in
trading accounts or available for sale. Adoption of additional such
rules may result in increased volatility in the reported health of the
industry, and mandated regulatory intervention to correct such problems.
Additional legislative and regulatory changes may be forthcoming. For
example, the bank regulatory authorities have proposed substantial
changes to the Community Reinvestment Act and fair lending laws, rules
and regulations, and there can be no certainty as to the effect, if any,
that such changes would have on the Equity Securities in the Trust's
portfolio. In addition, from time to time the deposit insurance system
is reviewed by Congress and federal regulators, and proposed reforms of
that system could, among other things, further restrict the ways in
which deposited moneys can be used by banks or reduce the dollar amount
or number of deposits insured for any depositor. Such reforms could
reduce profitability as investment opportunities available to bank
institutions become more limited and as consumers look for savings
vehicles other than bank deposits. Banks and thrifts face significant
competition from other financial institutions such as mutual funds,
credit unions, mortgage banking companies and insurance companies, and
increased competition may result from legislative broadening of regional
and national interstate banking powers as has been recently enacted.
Among other benefits, the legislation allows banks and bank holding
companies to acquire across previously prohibited state lines and to
consolidate their various bank subsidiaries into one unit. The Sponsor
makes no prediction as to what, if any, manner of bank and thrift
regulatory actions might ultimately be adopted or what ultimate effect
such actions might have on the Trust's portfolio.
The Federal Bank Holding Company Act of 1956 generally prohibits a bank
holding company from (1) acquiring, directly or indirectly, more than 5%
of the outstanding shares of any class of voting securities of a bank or
bank holding company, (2) acquiring control of a bank or another bank
holding company, (3) acquiring all or substantially all the assets of a
bank, or (4) merging or consolidating with another bank holding company,
without first obtaining Federal Reserve Board ("FRB") approval. In
considering an application with respect to any such transaction, the FRB
is required to consider a variety of factors, including the potential
anti-competitive effects of the transaction, the financial condition and
future prospects of the combining and resulting institutions, the
managerial resources of the resulting institution, the convenience and
needs of the communities the combined organization would serve, the
record of performance of each combining organization under the Community
Reinvestment Act and the Equal Credit Opportunity Act, and the
prospective availability to the FRB of information appropriate to
determine ongoing regulatory compliance with applicable banking laws. In
addition, the federal Change In Bank Control Act and various state laws
impose limitations on the ability of one or more individuals or other
entities to acquire control of banks or bank holding companies.
The FRB has issued a policy statement on the payment of cash dividends
by bank holding companies. In the policy statement, the FRB expressed
its view that a bank holding company experiencing earnings weaknesses
should not pay cash dividends which exceed its net income or which could
only be funded in ways that would weaken its financial health, such as
by borrowing. The FRB also may impose limitations on the payment of
dividends as a condition to its approval of certain applications,
including applications for approval of mergers and acquisitions. The
Sponsor makes no prediction as to the effect, if any, such laws will
have on the Equity Securities or whether such approvals, if necessary,
will be obtained.
General. Each Trust consists of such Equity Securities listed under the
"Schedule of Investments" for each Trust as may continue to be held from
time to time in a Trust and any additional Equity Securities acquired
and held by the Trusts pursuant to the provisions of the Indenture,
Page 20
together with cash held in the Income and Capital Accounts. Neither the
Sponsor nor the Trustee shall be liable in any way for any failure in
any of the Equity Securities. However, should any contract for the
purchase of any of the Equity Securities initially deposited hereunder
fail, the Sponsor will, unless substantially all of the moneys held in a
Trust to cover such purchase are reinvested in substitute Equity
Securities in accordance with the Indenture, refund the cash and sales
charge attributable to such failed contract to all Unit holders on the
next distribution date.
Because certain of the Equity Securities from time to time may be sold
under certain circumstances described herein, and because the proceeds
from such events will be distributed to Unit holders and will not be
reinvested, no assurance can be given that a Trust will retain for any
length of time its present size and composition. Although the Portfolio
is not managed, the Sponsor may instruct the Trustee to sell Equity
Securities under certain limited circumstances. Pursuant to the
Indenture and with limited exceptions, the Trustee may sell any
securities or other property acquired in exchange for Equity Securities
such as those acquired in connection with a merger or other transaction.
If offered such new or exchanged securities or property, the Trustee
shall reject the offer. However, in the event such securities or
property are nonetheless acquired by a Trust, they may be accepted for
deposit in such Trust and either sold by the Trustee or held in the
Trust pursuant to the direction of the Sponsor (who may rely on the
advice of the Portfolio Supervisor). See "Rights of Unit Holders-How May
Equity Securities be Removed from a Trust?" Equity Securities, however,
will not be sold by a Trust to take advantage of market fluctuations or
changes in anticipated rates of appreciation or depreciation.
Whether or not the Equity Securities are listed on a national securities
exchange, the principal trading market for the Equity Securities may be
in the over-the-counter market. As a result, the existence of a liquid
trading market for the Equity Securities may depend on whether dealers
will make a market in the Equity Securities. There can be no assurance
that a market will be made for any of the Equity Securities, that any
market for the Equity Securities will be maintained or of the liquidity
of the Equity Securities in any markets made. In addition, a Trust may
be restricted under the Investment Company Act of 1940 from selling
Equity Securities to the Sponsor. The price at which the Equity
Securities may be sold to meet redemptions, and the value of a Trust,
will be adversely affected if trading markets for the Equity Securities
are limited or absent.
An investment in Units should be made with an understanding of the risks
which an investment in common stocks entails, including the risk that
the financial condition of the issuers of the Equity Securities or the
general condition of the common stock market may worsen and the value of
the Equity Securities and therefore the value of the Units may decline.
The past market and earnings performance of the Equity Securities
included in the Trusts is not predictive of their future performance.
Common stocks are especially susceptible to general stock market
movements and to volatile increases and decreases of value as market
confidence in and perceptions of the issuers change. These perceptions
are based on unpredictable factors including expectations regarding
government, economic, monetary and fiscal policies, inflation and
interest rates, economic expansion or contraction, and global or
regional political, economic or banking crises. Shareholders of common
stocks have rights to receive payments from the issuers of those common
stocks that are generally subordinate to those of creditors of, or
holders of debt obligations or preferred stocks of, such issuers.
Shareholders of common stocks of the type held by a Trust have a right
to receive dividends only when and if, and in the amounts, declared by
the issuer's board of directors and have a right to participate in
amounts available for distribution by the issuer only after all other
claims on the issuer have been paid or provided for. Common stocks do
not represent an obligation of the issuer and, therefore, do not offer
any assurance of income or provide the same degree of protection of
capital as do debt securities. The issuance of additional debt
securities or preferred stock will create prior claims for payment of
principal, interest and dividends which could adversely affect the
ability and inclination of the issuer to declare or pay dividends on its
common stock or the rights of holders of common stock with respect to
assets of the issuer upon liquidation or bankruptcy. The value of common
stocks is subject to market fluctuations for as long as the common
stocks remain outstanding, and thus the value of the Equity Securities
in the Portfolio may be expected to fluctuate over the life of a Trust
to values higher or lower than those prevailing on the Initial Date of
Deposit.
Holders of common stocks incur more risk than holders of preferred
Page 21
stocks and debt obligations because common stockholders, as owners of
the entity, have generally inferior rights to receive payments from the
issuer in comparison with the rights of creditors of, or holders of debt
obligations or preferred stocks issued by, the issuer. Cumulative
preferred stock dividends must be paid before common stock dividends and
any cumulative preferred stock dividend omitted is added to future
dividends payable to the holders of cumulative preferred stock.
Preferred stockholders are also generally entitled to rights on
liquidation which are senior to those of common stockholders.
Certain of the Equity Securities in one or more of the Trusts are of
foreign issuers, and therefore, an investment in such a Trust involves
some investment risks that are different in some respects from an
investment in a trust that invests entirely in securities of domestic
issuers. Those investment risks include future political and
governmental restrictions which might adversely affect the payment or
receipt of payment of dividends on the relevant Equity Securities,
currency exchange rate fluctuations, exchange control policies, and the
limited liquidity and small market capitalization of such foreign
countries' securities markets. In addition, for foreign issuers that are
not subject to the reporting requirements of the Securities Exchange Act
of 1934, there may be less publicly available information than is
available from a domestic issuer. Also, foreign issuers are not
necessarily subject to uniform accounting, auditing and financial
reporting standards, practices and requirements comparable to those
applicable to domestic issuers. However, due to the nature of the
issuers of the Equity Securities included in the Trust, the Sponsor
believes that adequate information will be available to allow the
Portfolio Supervisor to provide portfolio surveillance.
Certain of the Equity Securities in one or more of the Trusts are in ADR
or GDR form. ADRs, which evidence American Depositary Receipts and GDRs,
which evidence Global Depositary Receipts, represent common stock
deposited with a custodian in a depositary. American Depositary Shares
and Global Depositary Shares (collectively, the "Depositary Receipts")
are issued by a bank or trust company to evidence ownership of
underlying securities issued by a foreign corporation. These instruments
may not necessarily be denominated in the same currency as the
securities into which they may be converted. For purposes of the
discussion herein, the terms ADR and GDR generally include American
Depositary Shares and Global Depositary Shares, respectively.
Depositary Receipts may be sponsored or unsponsored. In an unsponsored
facility, the depositary initiates and arranges the facility at the
request of market makers and acts as agent for the Depositary Receipts
holder, while the company itself is not involved in the transaction. In
a sponsored facility, the issuing company initiates the facility and
agrees to pay certain administrative and shareholder-related expenses.
Sponsored facilities use a single depositary and entail a contractual
relationship between the issuer, the shareholder and the depositary;
unsponsored facilities involve several depositaries with no contractual
relationship to the company. The depositary bank that issues Depositary
Receipts generally charges a fee, based on the price of the Depositary
Receipts, upon issuance and cancellation of the Depositary Receipts.
This fee would be in addition to the brokerage commissions paid upon the
acquisition or surrender of the security. In addition, the depositary
bank incurs expenses in connection with the conversion of dividends or
other cash distributions paid in local currency into U.S. dollars and
such expenses are deducted from the amount of the dividend or
distribution paid to holders, resulting in a lower payout per underlying
shares represented by the Depositary Receipts than would be the case if
the underlying share were held directly. Certain tax considerations,
including tax rate differentials and withholding requirements, arising
from applications of the tax laws of one nation to nationals of another
and from certain practices in the Depositary Receipts market may also
exist with respect to certain Depositary Receipts. In varying degrees,
any or all of these factors may affect the value of the Depositary
Receipts compared with the value of the underlying shares in the local
market. In addition, the rights of holders of Depositary Receipts may be
different than those of holders of the underlying shares, and the market
for Depositary Receipts may be less liquid than that for the underlying
shares. Depositary Receipts are registered securities pursuant to the
Securities Act of 1933 and may be subject to the reporting requirements
of the Securities Exchange Act of 1934.
For the Equity Securities that are Depositary Receipts, currency
fluctuations will affect the U.S. dollar equivalent of the local
currency price of the underlying domestic share and, as a result, are
likely to affect the value of the Depositary Receipts and consequently
Page 22
the value of the Equity Securities. The foreign issuers of securities
that are Depositary Receipts may pay dividends in foreign currencies
which must be converted into dollars. Most foreign currencies have
fluctuated widely in value against the United States dollar for many
reasons, including supply and demand of the respective currency, the
soundness of the world economy and the strength of the respective
economy as compared to the economies of the United States and other
countries. Therefore, for any securities of issuers (whether or not they
are in Depositary Receipt form) whose earnings are stated in foreign
currencies, or which pay dividends in foreign currencies or which are
traded in foreign currencies, there is a risk that their United States
dollar value will vary with fluctuations in the United States dollar
foreign exchange rates for the relevant currencies.
Unit holders will be unable to dispose of any of the Equity Securities
in a Portfolio, as such, and will not be able to vote the Equity
Securities. As the holder of the Equity Securities, the Trustee will
have the right to vote all of the voting stocks in a Trust and will vote
such stocks in accordance with the instructions of the Sponsor.
What are the Equity Securities Selected for America's Leading Brands
Growth Trust, Series 4?
Apparel
_______
Nautica Enterprises, Inc., headquartered in New York, New York, through
subsidiaries, designs, sources and sells fine quality men's sportswear,
outerwear and activewear with a distinctive active outdoor image which
is sold through better department store chains and specialty stores.
Tommy Hilfiger Corporation, headquartered in Kowloon, Hong Kong, through
subsidiaries, designs, sources and markets designer men's sportswear and
boyswear, including woven and knit shirts, pants, sweaters, outerwear
and athletic wear. These products are complemented by collections of
men's tailored clothing, dress shirts and accessories, footwear, women's
casualwear and men's and women's fragrances, among others, bearing the
Tommy Hilfiger trademark, which are produced and sold pursuant to
certain licensing arrangements.
Beverages
__________
Anheuser-Busch Companies, Inc., headquartered in St. Louis, Missouri,
brews beer, makes metal beverage containers, recycles metal and glass
beverage containers, and operates theme parks.
The Coca-Cola Company, headquartered in Atlanta, Georgia, makes and
distributes soft drink concentrates and syrups; and also markets juice
and juice-drink products. The company's products are sold in 200
countries and include the leading soft drink products in most of these
countries.
PepsiCo, Inc., headquartered in Purchase, New York, produces and
distributes beverage concentrates, syrups and soft drinks. The company
also operates or franchises others to operate "Pizza Hut," "Kentucky
Fried Chicken" and "Taco Bell" restaurants; and makes snacks and other
food products.
Entertainment
_____________
The Walt Disney Company, headquartered in Burbank, California, operates
as a diversified international entertainment company with operations
consisting of filmed entertainment, theme parks and resorts and consumer
products. Disney also has broadcasting (including Capital Cities/ABC,
Inc.) and publishing operations.
Food
____
Campbell Soup Company, headquartered in Camden, New Jersey, with
subsidiaries, makes and markets soups and sauces, biscuits and
confectionery products, and frozen foods and pickles. The company also
distributes "Campbell's Soups" and "Campbell's Specialty Kitchen"
entrees to the food service and meal replacement markets.
H.J. Heinz Company, headquartered in Pittsburgh, Pennsylvania, makes,
packages and sells processed food products, including ketchup and
sauces/condiments, pet food, baby food, frozen meals and snacks, frozen
potatoes and vegetables, soups, beans and pasta. The company also
provides weight control services and sells food products to food service
operators.
Hershey Foods Corporation, headquartered in Hershey, Pennsylvania, makes
and sells chocolate and non-chocolate confectionery products and grocery
and pasta products.
Page 23
Sara Lee Corporation, headquartered in Chicago, Illinois, with
subsidiaries, makes, markets and distributes packaged food, packaged
consumer goods, and household and personal care products throughout the
world.
Household Products
__________________
The Clorox Company, headquartered in Oakland, California, makes and
sells nondurable consumer products sold mainly through grocery stores,
mass merchandisers and other retail outlets. The company's products
include laundry additives, home cleaning products, charcoal,
insecticides, cat litter, dressings and sauces, water filtration systems
and professional products.
Colgate-Palmolive Company, headquartered in New York, New York, through
subsidiaries, produces and distributes oral, personal and household care
and pet nutrition products. Principal global trademarks include "Ajax,"
"Colgate," "Fab," "Mennen," "Palmolive," "Prescription Diet" "Protex,"
"Science Diet" and "Soupline/Suavitel" in addition to various regional
trademarks.
The Procter & Gamble Company, headquartered in Cincinnati, Ohio, through
subsidiaries, makes detergents, fabric conditioners and hard surface
cleaners; products for personal cleansing, oral care, digestive health,
hair and skin; paper tissue, disposable diapers, and pharmaceuticals;
shortenings, oils, snacks, baking mixes, peanut butter, coffee, drinks
and citrus products.
Pharmaceuticals
_______________
Bristol-Myers Squibb Company, headquartered in New York, New York,
through divisions and subsidiaries, produces and distributes
pharmaceutical and non-prescription health products, toiletries and
beauty aids, and medical devices.
Johnson & Johnson, headquartered in New Brunswick, New Jersey, makes and
sells pharmaceuticals, personal healthcare products, medical and
surgical equipment, and contact lenses.
Schering-Plough Corporation, headquartered in Madison, New Jersey,
develops, makes and markets pharmaceutical and healthcare products
worldwide. Products include prescription drugs, animal health, over-the-
counter, foot care and sun care products.
Recreation
__________
Carnival Corporation, headquartered in Miami, Florida, operates the
world's largest multiple-night cruise line under the names "Carnival
Cruise," "Holland America Line" and "Windstar Cruises." The company also
markets sightseeing tours and operates hotels under the name "Westmark
Hotels."
Harley-Davidson, Inc., headquartered in Milwaukee, Wisconsin, designs,
makes and sells heavyweight touring and custom motorcycles and related
products and accessories. The company also provides financing and
insurance services for its motorcycles.
Restaurants
___________
McDonald's Corporation, headquartered in Oak Brook, Illinois, develops,
franchises, operates and services a worldwide system of quick-service
restaurants under the name "McDonald's."
Starbucks Corporation, headquartered in Seattle, Washington, buys and
roasts whole bean coffees and sells them, along with fresh, rich-brewed
coffees, Italian-style espresso beverages, a variety of pastries and
confections, and coffee-related accessories and equipment, mainly
through its retail stores.
Retail
______
The Gap, Inc., headquartered in San Francisco, California, operates
specialty retail stores in Canada, France, Germany, Japan, the United
States and the United Kingdom. Stores sell casual apparel, shoes and
other accessories for men, women and children under a variety of brand
names, including "Gap," "GapKids," "babyGap," "Banana Republic" and "Old
Navy."
Technology
___________
Intel Corporation, headquartered in Santa Clara, California, designs,
develops, makes and markets advanced microcomputer components and
related products at various levels of integration. Microcomputer
components are integrated circuits consisting of silicon-based
semiconductors etched with complex patterns of transistors.
Page 24
Tobacco
_______
Philip Morris Companies, Inc., headquartered in New York, New York,
makes cigarettes and tobacco products, packaged grocery products,
coffee, cheeses, chocolate confections, meats and beer.
Toiletries/Cosmetics
____________________
The Gillette Company, headquartered in Boston, Massachusetts, is a
leading manufacturer of male and female grooming products and oral care
products. The company is also the top seller of writing instruments and
correction products. Gillette's products are distributed through
wholesalers, retailers and agents in over 200 countries and territories.
Toys
____
Mattel, Inc., headquartered in El Segundo, California, designs, makes
and sells Barbie fashion dolls and doll clothing and accessories,
"Fisher-Price" toys and juvenile products, die-cast "Hot Wheels"
vehicles and playsets, "Cabbage Patch Kids" dolls and other large dolls,
"Scrabble," card games, preschool toys and Disney-licensed toys.
What are the Equity Securities Selected for Auto & Transportation Growth
Trust Series?
Air Freight
___________
Airborne Freight Corporation, headquartered in Seattle, Washington,
provides door-to-door express delivery of small packages and documents
throughout the United States and to and from most foreign countries. The
company also acts as an international and domestic freight forwarder for
shipments of any size.
Air Express International Corporation, headquartered in Darien,
Connecticut, through subsidiaries, provides domestic and international
air freight forwarding services; ocean freight services; customs
brokerage clearance services in the United States and 21 foreign
countries; and ancillary services.
Expeditors International of Washington, Inc., headquartered in Seattle,
Washington, provides international freight forwarding and consolidation
for both air and ocean freight. The company acts as a customs broker in
all domestic offices and in many of its overseas offices.
Airlines
________
AMR Corporation, headquartered in Fort Worth, Texas, provides jet
service to more than 160 destinations, mainly throughout North America,
the Caribbean, Europe, Latin America and the Pacific; turboprop service
to smaller markets; and ground handling and support services. The
company also provides information processing and investment management
services.
ASA Holdings, Inc., headquartered in Atlanta, Georgia, through a
subsidiary, provides high frequency airline service between Hartsfield
Atlanta International Airport and other airports in Alabama, Florida,
Georgia, Indiana, Kentucky, Louisiana, Mississippi, North Carolina,
South Carolina, Tennessee, Virginia, and West Virginia; and between
Dallas/Fort Worth International Airport and other airports in Arkansas,
Kansas, Louisiana, Mississippi, Oklahoma and Texas. Wholly-owned
Atlantic Southeast Airlines, Inc. offers flights which are used mainly
by business, government and military passengers to make connections with
flights operated by Delta Air Lines, Inc. and other carriers from
Atlanta and Dallas/Fort Worth.
Comair Holdings, Inc., headquartered in Cincinnati, Ohio, provides
scheduled air transportation for passengers and freight, serving
airports in the midwestern, southeastern and northeastern United States,
as well as the Bahamas and Canada.
Delta Air Lines, Inc., headquartered in Atlanta, Georgia, provides
scheduled air transportation for passengers, freight and mail over a
network of routes throughout the United States and abroad. The company
serves domestic cities in 42 states, Washington, D.C., Puerto Rico and
the U.S. Virgin Islands, as well as cities in 25 foreign countries.
Midwest Express Holdings, Inc., headquartered in Oak Creek, Wisconsin,
through subsidiaries, operates a single-class, premium service passenger
jet airline that caters to business travelers and serves selected major
business destinations throughout the United States and Toronto from
operations in Milwaukee and Omaha; and offers commuter air service
between Milwaukee and 24 midwestern cities.
Page 25
Southwest Airlines Company, headquartered in Dallas, Texas, provides
single class air transportation characterized by frequent, high quality
service at affordable prices. The company mainly serves short-haul city
pairs, targeting the business commuter as well as leisure travelers.
UAL Corporation, headquartered in Elk Grove Township, Illinois, through
wholly-owned United Air Lines, Inc., owns and operates a commercial
airline, serving airports in the United States, 29 foreign countries and
two territories.
Motor Vehicles
______________
Chrysler Corporation, headquartered in Auburn Hills, Michigan, and its
subsidiaries make, assemble and sell cars and trucks under the brand
names "Chrysler," "Dodge," "Eagle," "Jeep," "Plymouth" and related parts
and accessories. The company also provides financial services to
customers and dealers.
Ford Motor Company, headquartered in Dearborn, Michigan, the second
largest producer of cars and trucks worldwide, makes, assembles and
sells cars, vans, trucks, tractors and their related parts and
accessories. The company also provides financing operations, vehicle and
equipment leasing and insurance operations.
Harley-Davidson Company, headquartered in Milwaukee, Wisconsin, designs,
makes and sells heavyweight touring and custom motorcycles and related
products and accessories. The company also provides financing and
insurance services for its motorcycles.
Honda Motor Company, Limited (ADR), headquartered in Tokyo, Japan, with
subsidiaries, makes a wide variety of products using internal combustion
engines, including motorcycles, automobiles and power products, such as
portable generators, small general purpose engines, lawn mowers and
tractors, power tillers, outboard engines and four-wheeled all-terrain
vehicles.
Navistar International Corporation, headquartered in Chicago, Illinois,
makes and sells medium and heavy trucks (Class 5 through 8 diesel
trucks) including school buses, mid-range diesel engines and service
parts. The company also engages in the wholesale, retail and lease
financing of new and used trucks.
PACCAR, Inc., headquartered in Bellevue, Washington, makes heavy-duty
trucks and related parts, sells automotive parts and accessories through
retail outlets, and makes industrial winches. The company also provides
financing and leasing services to customers and dealers.
Motor Vehicles - Parts and Accessories
______________________________________
Dana Corporation, headquartered in Toledo, Ohio, makes and sells
products and systems for the worldwide vehicular, industrial and off-
highway original equipment markets and is a major supplier to the
related aftermarkets. The company also provides lease financing.
Eaton Corporation, headquartered in Cleveland, Ohio, mainly makes truck
transmissions, engine components, hydraulic products, electrical power
distribution and controls equipment, ion implanters and a wide variety
of controls.
Gentex Corporation, headquartered in Zeeland, Michigan, designs, makes
and sells two product lines employing electro-optical technology:
automatic rearview mirrors for the automotive industry; and fire
protection products for the commercial building industry.
The Goodyear Tire & Rubber Company, headquartered in Akron, Ohio,
develops, makes and sells tires and related transportation products;
participates in various crude oil transportation and gathering
activities; and makes various industrial rubber and chemical products.
Johnson Controls, Inc., headquartered in Milwaukee, Wisconsin, makes
automobile batteries, interior and seating systems; makes, installs and
services control systems for non-residential buildings to manage energy
use, temperature, ventilation, security and fire safety.
Lear Corporation, headquartered in Southfield, Michigan, one of the
largest independent automotive suppliers in the world, supplies
automotive interiors including seat systems, floor and acoustic systems,
door panels, headliners and instrument panels.
Tower Automotive, Inc., headquartered in Minneapolis, Minnesota, designs
and produces high-quality, engineered metal stampings and assemblies
used by original equipment manufacturers in the North American
automotive industry, including "Chrysler," "Ford," "General Motors,"
"Honda," "Mazda," "Nissan" and "Toyota."
Page 26
Railroads
_________
Burlington Northern Santa Fe Corporation, headquartered in Fort Worth,
Texas, through subsidiaries, operates one of the largest railroad
systems in the United States with some routes reaching across 28 states
and two Canadian provinces to provide single-line service to shippers.
Norfolk Southern Corporation, headquartered in Norfolk, Virginia,
through subsidiaries, operates a railroad over 14,000 miles of road,
mainly in the southeast and midwest and in Ontario.
Wisconsin Central Transportation Corporation, headquartered in Rosemont,
Illinois, through subsidiaries, operates a large regional railroad
consisting of route miles of track and trackage rights in Illinois,
Michigan, Minnesota and Wisconsin, and Ontario, Canada.
Trucking
________
Heartland Express, Inc., headquartered in Coralville, Iowa, provides
nationwide transportation service to major shippers, using late-model
equipment and a balanced fleet of company-owned and owner-operator
tractors.
M.S. Carriers, Inc., headquartered in Memphis, Tennessee, hauls
truckload shipments of general commodities throughout the United States
and the provinces of Quebec and Ontario, Canada.
Swift Transportation Company, Inc., headquartered in Phoenix, Arizona,
through subsidiaries, operates as a national truckload carrier of
general commodities in the eastern, western and midwestern United
States. The company also operates a transcontinental van business.
Werner Enterprises, Inc., headquartered in Omaha, Nebraska, transports
truckload shipments of general commodities throughout the 48 contiguous
states. The company also has authority to operate in Canada and provides
through trailer service in and out of Mexico.
What are the Equity Securities Selected for Communications Growth Trust,
Series 3?
Cable TV
________
Comcast Corporation (Class A Special), headquartered in headquartered in
Philadelphia, Pennsylvania, owns and operates cable television systems
in the United States and the United Kingdom. The company develops,
manages and operates cellular telephone systems in portions of Delaware,
Illinois, New Jersey and Pennsylvania. The company also provides
electronic retailing services through QVC, Inc., a nationwide general
merchandise retailer.
MediaOne Group, Inc., headquartered in Englewood, Colorado, provides
cable and telecommunications network businesses outside of the
midwestern and western United States and internationally; domestic and
international wireless communications network businesses; and domestic
and international directory and information services.
Computer Networking
___________________
3Com Corporation, headquartered in Santa Clara, California, offers a
broad range of networking products which include routers, switches,
hubs, remote access servers, adapters and network management software
for Ethernet, Token Ring, FDDI, ATM and other high-speed networks.
Ascend Communications, Inc., headquartered in Alameda, California,
develops, makes, markets, sells and supports a broad range of high-speed
digital wide area network access products that enable its customers to
build Internet access systems, extensions and enhancements to corporate
backbone networks, and videoconferencing and multimedia access facilities.
Cisco Systems, Inc., headquartered in San Jose, California, develops,
makes, sells and supports high performance internetworking systems that
link geographically dispersed local and wide area networks to form a
single, seamless information infrastructure.
Communications Equipment
________________________
ADC Telecommunications, Inc., headquartered in Minnetonka, Minnesota,
designs, makes and markets a broad range of products and services that
enable its customers to construct and upgrade their telecommunications
networks to support increasing user demand for voice, data and video
services.
Aspect Telecommunications Corporation, headquartered in San Jose,
California, develops, markets and supports call transaction processing
Page 27
systems to support high volume telephone sales and support systems.
Products include automatic call distributor systems and software;
computer-telephony integration application software and tools; and
interactive voice response systems.
Comverse Technology, Inc., headquartered in Woodbury, New York, makes
and sells computer and telecommunications systems for multimedia
communications and information processing applications, which are used
by telephone network operators, government agencies, call centers,
financial institutions and other public and commercial organizations
worldwide.
Lucent Technologies, Inc., headquartered in New Providence, New Jersey,
is one of the world's leading designers, developers and manufacturers of
telecommunications systems, software and products. The company is a
leading global marketer of business communications systems and computers.
Northern Telecom Ltd., headquartered in Ontario, Canada, makes fully
digital telecommunications switching equipment and communications
equipment and systems for business and residential use.
Tellabs, Inc., headquartered in Lisle, Illinois, makes and services
voice, data and video transport and network access systems used by
public telephone companies, long distance carriers, alternate service
providers, cellular providers, cable operators, government agencies,
utilities and business end-users.
Communications Services
_______________________
ALLTEL Corporation, headquartered in Little Rock, Arkansas, provides
wireline local, long distance, network access and internet services,
wireless communications, wide-area paging service and information
processing management services and applications software. The company
also publishes telephone directories for affiliates and other
independent telephone companies.
AirTouch Communications, Inc., headquartered in San Francisco,
California, provides wireless telecommunications services to subscribers
in Asia, Europe and the United States; and paging services in the United
States.
Bell Atlantic Corporation, headquartered in New York, New York, operates
a diversified telecommunications concern that provides voice and data
transport and calling services network access, directory publishing and
public telephone services to customers in the mid-Atlantic and New
England regions.
BellSouth Corporation, headquartered in Atlanta, Georgia, provides
wireline telecommunications in Alabama, Florida, Georgia, Kentucky,
Louisiana, Mississippi, North Carolina, South Carolina and Tennessee.
The company also provides wireless and international communications
services and advertising and publishing products.
Cable & Wireless Plc (ADR), headquartered in London, England, operates
as an international provider of telecommunications and multimedia
communications services in over 50 countries including Australia, Hong
Kong, Japan, the United Kingdom and the United States.
Deutsche Telekom AG (ADR), headquartered in Bonn, Germany, provides
telecommunications services in Germany, including telephone, mobile
communications and cable services.
MCI WorldCom, Inc., headquartered in Jackson, Mississippi, through
subsidiaries, provides long distance and local products, 800 services,
calling cards, domestic and international private lines, broadband data
services, debit cards, conference calling, fax and data connections, and
interconnection to Internet service providers.
Qwest Communications International, Inc., headquartered in Denver,
Colorado, provides communications services to interexchange carriers and
other communications entities, businesses and consumers.
SBC Communications, Inc., headquartered in San Antonio, Texas, provides
landline and wireless telecommunications services and equipment,
directory advertising, publishing and cable television services in
Arkansas, California, Kansas, Missouri, Nevada, Oklahoma and Texas.
Telefonica de Espana SA (ADR), headquartered in Madrid, Spain, is the
exclusive supplier of voice telephone services in Spain under a contract
with the Spanish State. It is also the largest Spanish mobile
communications operator in Spain; a leading telecommunications operator
in Latin America; and the world's second largest owner of submarine
cables.
Wireless Communications
_______________________
LM Ericsson AB (ADR), headquartered in Stockholm, Sweden, provides
Page 28
advanced systems, products and services for handling voice, data, image
and text in public and private wired and mobile telecommunications
network telecommunications power equipment, and telecommunications and
power cable.
Nokia Oy (ADR), headquartered in Espoo, Finland, makes mobile phones,
computer monitors, multimedia network terminals and battery chargers for
mobile phones. The company also makes satellite receivers and
videoconferencing equipment.
QUALCOMM, Inc., headquartered in San Diego, California, designs,
develops, makes, sells, licenses and operates advanced communications
systems and products based on proprietary digital wireless technology.
Vodafone Group Plc (ADR), headquartered in Berkshire, England, provides
mobile telecommunication services in 13 countries.
What are the Equity Securities Selected for Internet Growth Trust,
Series 5?
Access/Information Providers
____________________________
America Online, Inc., headquartered in Sterling, Virginia, provides
online services to consumers in the United States, Canada, Europe and
Japan offering subscribers a wide variety of services, including
electronic mail, conferencing, news, sports, Internet access,
entertainment, weather, stock quotes, software, computing support and
online classes.
First Data Corporation, headquartered in Hackensack, New Jersey,
provides processing services to issuers of VISA and MasterCards; payment
instrument processing services to institutions and consumers; telephone
and information processing services; shareholder services, information
systems and data processing.
MCI WorldCom, Inc., headquartered in Jackson, Mississippi, through
subsidiaries, provides long distance and local products, 800 services,
calling cards, domestic and international private lines, broadband data
services, debit cards, conference calling, fax and data connections, and
interconnection to Internet service providers.
MediaOne Group, Inc., headquartered in Englewood, Colorado, provides
cable and telecommunications network businesses outside of the
midwestern and western United States and internationally, domestic and
international wireless communications network businesses, and domestic
and international directory and information services.
MindSpring Enterprises, Inc., headquartered in Atlanta, Georgia,
provides Internet access serving individual subscribers, including
individuals with little or no prior online experience.
Qwest Communications International, Inc., headquartered in Denver,
Colorado, provides communications services to interexchange carriers and
other communications entities, businesses and consumers.
Communications Equipment
________________________
Lucent Technologies, Inc., headquartered in New Providence, New Jersey,
is one of the world's leading designers, developers and manufacturers of
telecommunications systems, software and products. The company is a
leading global marketer of business communications systems and computers.
Tellabs, Inc., headquartered in Lisle, Illinois, makes and services
voice, data and video transport and network access systems used by
public telephone companies, long distance carriers, alternate service
providers, cellular providers, cable operators, government agencies,
utilities and business end-users.
Computer Networking
___________________
3Com Corporation, headquartered in Santa Clara, California, offers a
broad range of networking products which include routers, switches,
hubs, remote access servers, adapters and network management software
for Ethernet, Token Ring, FDDI, ATM and other high-speed networks.
Ascend Communications, Inc., headquartered in Alameda, California,
develops, makes, markets, sells and supports a broad range of high-speed
digital wide area network access products that enable its customers to
build Internet access systems, extensions and enhancements to corporate
backbone networks, and videoconferencing and multimedia access facilities.
Cisco Systems, Inc., headquartered in San Jose, California, develops,
Page 29
makes, sells and supports high performance internetworking systems that
link geographically dispersed local and wide area networks to form a
single, seamless information infrastructure.
Computer Services
_________________
Cambridge Technology Partners, Inc., headquartered in Cambridge,
Massachusetts, provides management consulting and systems integration.
The company combines management consulting, IT strategy, process
innovation and implementation, custom and package software deployment,
network services and training to deliver business solutions for clients.
Computers
_________
Compaq Computer Corporation, headquartered in Houston, Texas, makes and
markets desktop personal computers, portable computers, workstations,
communications products and tower PC servers and peripheral products
that store and manage data in network environments. Products are
marketed mainly to business, home, government and education customers.
Dell Computer Corporation, headquartered in Round Rock, Texas, designs,
develops, makes, sells, services and supports a broad range of computer
systems, including desktops, notebooks and servers compatible with
industry standards under the "Dell" brand name. The company also sells
software, peripheral equipment, and service and support programs.
Hewlett-Packard Company, headquartered in Palo Alto, California,
designs, makes and services equipment and systems for measurement,
computation and communications, including computer systems, personal
computers, printers, calculators, electronic test equipment, medical
electronic equipment, solid state components and instrumentation for
chemical analysis.
Sun Microsystems, Inc., headquartered in Palo Alto, California, supplies
network computing products, including desktop systems, storage
subsystems, network switches, servers, software, microprocessors and a
full range of services and support. The company's software utilizes the
UNIX operating system.
Internet Content
________________
CMG Information Services, Inc., headquartered in Andover, Massachusetts,
offers a wide variety of direct marketing services, including mailing
lists, leading edge database management, design and development
capabilities, consultative list management and brokerage services,
Internet and interactive media direct marketing software technologies.
Retailing
_________
E*TRADE Group, Inc., headquartered in Palo Alto, California, provides
online discount brokerage services, using its proprietary processing
technology. Services include automated order placement, portfolio
tracking and related market information, news and other information.
Charles Schwab Corporation, headquartered in San Francisco, California,
through subsidiaries, provides discount securities brokerage and related
financial services; and offers trade execution services for Nasdaq
securities to broker/dealers and institutional customers.
Semiconductors
______________
Intel Corporation, headquartered in Santa Clara, California, designs,
develops, makes and markets advanced microcomputer components and
related products at various levels of integration. Microcomputer
components are integrated circuits consisting of silicon-based
semiconductors etched with complex patterns of transistors.
Software
________
Check Point Software Technologies, Ltd., headquartered in Ramat Gan,
Israel, develops, sells and supports network security software products
that enable connectivity with security and manageability.
Microsoft Corporation, headquartered in Redmond, Washington, makes,
sells and licenses software products, including operating systems,
server applications, business and consumer products, Internet software
technologies and development tools. The company also markets personal
computer books and input devices and researches and develops software
technologies.
Network Associates, Inc., headquartered in Santa Clara, California,
develops, markets, distributes and supports network security and
Page 30
management software products, including anti-virus protection as well as
client/server network management tools.
Oracle Corporation, headquartered in Redwood City, California, designs,
develops, markets and supports computer software products with a wide
variety of uses, including database management and network products,
application development and business intelligence productivity tools and
client server business applications.
Sterling Commerce, Inc., headquartered in Dallas, Texas, develops,
markets and supports electronic commerce software products and provides
electronic commerce network services that enable businesses to engage in
business-to-business electronic communications and transactions.
What are the Equity Securities Selected for Regional Bank & Thrift
Growth Trust, Series 2?
Banks
_____
Banknorth Group, Inc., headquartered in Burlington, Vermont, is a
community bank holding company which conducts a general banking business
through banking offices located throughout Massachusetts, New Hampshire
and Vermont. The company also offers mortgage banking services through a
mortgage loan origination office in Maine.
Chittenden Corporation, headquartered in Burlington, Vermont, through
subsidiaries, conducts a general commercial banking business in
Massachusetts and Vermont. The company offers a broad range of financial
products and services, including deposit accounts and services;
commercial, consumer and public sector loans; and investment and trust
services to businesses, individuals and the public sector.
Colonial BancGroup, Inc., headquartered in Montgomery, Alabama, conducts
a general commercial banking business through offices in Alabama,
Florida, Georgia and Tennessee. The company also operates a retail and
wholesale mortgage banking business.
Commerce Bancshares, Inc., headquartered in Kansas City, Missouri,
conducts a banking business in locations in three states; underwrites
credit life and credit accident and health insurance; sells property and
casualty insurance, and provides mortgage banking and real estate
services.
Community First Bankshares, Inc., headquartered in Fargo, North Dakota,
through subsidiaries, conducts a banking business in nine states. The
company also offers trust and insurance services.
Compass Bancshares, Inc., headquartered in Birmingham, Alabama, through
subsidiaries, conducts a general commercial banking business through
offices in three states. The company also offers a full range of trust
services to customers in Texas through offices in Houston and Dallas,
Texas.
Cullen/Frost Bankers, Inc., headquartered in San Antonio, Texas, through
subsidiaries, conducts a banking business through offices in Austin,
Corpus Christi, Galveston, Houston, McAllen, San Antonio and San Marcos,
Texas. The company also operates a general insurance agency and provides
discount brokerage services.
First American Corporation, headquartered in Nashville, Tennessee,
through subsidiaries, conducts a general commercial banking business
through banking offices and ATMs in Kentucky, Tennessee and Virginia.
The company also provides trust and investment advisory services and
underwrites credit life and accident and health insurance.
FirstBank Puerto Rico, headquartered in Santurce, Puerto Rico, with
wholly-owned subsidiaries, conducts a general banking business through
full-service branches in Puerto Rico and offices in the United States
Virgin Islands. The company specializes in small personal loans, used
auto financing and financing lease of autos in Puerto Rico.
First Security Corporation, headquartered in Salt Lake City, Utah,
conducts a banking business through full-service bank offices in Idaho,
Nevada, New Mexico, Oregon, Utah and Wyoming. The company originates
residential mortgage loans, originates and manages leases, and offers
insurance products and investment management services.
GBC Bancorp, headquartered in Los Angeles, California, through wholly-
owned General Bank, operates a commercial banking business through
banking offices in the greater Los Angeles, San Diego and Silicon
Valley, California areas.
HUBCO, Inc., headquartered in Mahwah, New Jersey, is the holding company
for Hudson United Bank in New Jersey, Lafayette American Bank and Trust
in Connecticut, and the Bank of the Hudson in New York. The banks are
Page 31
full-service commercial banks and offer the services generally performed
by commercial banks of similar size and character.
Irwin Financial Corporation, headquartered in Columbus, Indiana, through
subsidiaries, operates a commercial banking business through offices in
Indiana; originates and services residential mortgages; provides credit
life insurance and securities brokerage services; and leases medical
equipment.
M&T Bank Corporation (formerly First Empire State Corp.), headquartered
in Buffalo, New York, conducts a commercial banking business through
offices mainly in New York. The company is a bank holding company that,
through its subsidiaries, provides individuals, corporations and
institutions with commercial and retail banking services, including
loans and deposits, trust, mortgage banking, asset management and other
financial services.
North Fork Bancorporation, Inc., headquartered in Melville, New York,
operates a full-service retail and commercial banking business through
branch locations in New York. The company also provides broker/dealer
services to financial institutions, individual investors and traders.
Oriental Financial Group, Inc., headquartered in San Juan, Puerto Rico,
through wholly-owned Oriental Bank & Trust, conducts a commercial
banking business through banking offices throughout Puerto Rico.
Provident Financial Group, inc., headquartered in Cincinnati, Ohio,
conducts a banking and trust business through offices in Ohio, Florida
and Kentucky. The company provides trust, custodial, asset management
and securities brokerage and also conducts equipment leasing.
Silicon Valley Bancshares, headquartered in Santa Clara, California,
through wholly-owned Silicon Valley Bank, operates a general banking
business through offices in California, Colorado, Maryland,
Massachusetts, Oregon, Texas and Washington.
Sterling Bancshares, Inc., headquartered in Houston, Texas, through
wholly-owned Sterling Bank, provides commercial and retail banking
services through community banking offices in the greater Houston, Texas
metropolitan area. The bank also facilitates sales of brokerage
products, mutual funds and insurance products through third party vendors.
TCF Financial Corporation, headquartered in Minneapolis, Minnesota,
operates a national banking business through offices in five states. The
company also originates, sells and services residential mortgage loans;
sells annuities and mutual fund products; provides insurance, mainly
credit-related; and makes consumer finance loans.
Texas Regional Bancshares, Inc. (Class A), headquartered in McAllen,
Texas, through wholly-owned Texas State Bank, conducts a commercial
banking business through banking locations in Edinburg and the Rio
Grande Valley of Texas.
Webster Financial Corporation, headquartered in Waterbury, Connecticut,
provides retail, mortgage and commercial banking services to individuals
and businesses through full-service banking offices in Connecticut. The
company also originates mortgage loans throughout Connecticut.
Zions Corporation, headquartered in Salt Lake City, Utah, conducts a
banking business through offices in Utah, Arizona, California, Colorado,
Idaho, Nevada and New Mexico. The company underwrites insurance,
operates an insurance brokerage business and provides innovative
financing solutions for small businesses nationwide.
Thrifts
_______
Charter One Financial, Inc., headquartered in Cleveland, Ohio, through
wholly-owned Charter One Bank, F.S.B., operates a banking business
through full-service banking offices in Ohio, Michigan and New York, and
loan production offices in Ohio, Indiana, Kentucky and Michigan.
Commercial Federal Corporation, headquartered in Omaha, Nebraska,
through subsidiaries, conducts a general banking business through branch
offices in five states. The company also provides insurance and
securities brokerage and other retail financial services.
Flagstar Bancorp, Inc., headquartered in Bloomfield Hills, Michigan,
through subsidiaries, provides retail banking services through branches
in Michigan and originates residential mortgages through retail loan
offices in Michigan, California and Ohio. The company also originates
mortgage loans on a wholesale basis through a nationwide network of
independent brokers.
GreenPoint Financial Corporation, headquartered in New York, New York,
through subsidiaries, conducts a savings bank business through branches
Page 32
in the New York City metropolitan area. The company also offers lending
programs, development opportunities and other activities; and mortgage
banking.
MAF Bancorp, Inc., headquartered in Clarendon Hills, Illinois, operates
a general banking business through retail offices, located mainly in the
western suburbs of Chicago. The company also engages in real estate
development, and insurance and securities sales.
People's Heritage Financial Group, Inc., headquartered in Portland,
Maine, through subsidiaries, conducts a general banking business through
offices in Maine, Massachusetts and New Hampshire. The company also
leases equipment and provides financial planning and securities
brokerage activities.
Sovereign Bancorp, Inc., headquartered in Wyomissing, Pennsylvania,
conducts a banking business through banking offices serving the eastern
Pennsylvania, northern Delaware and New Jersey areas. The company is the
holding company for Sovereign Bank.
The Sponsor has obtained the foregoing company descriptions from sources
it deems reliable. The Sponsor has not independently verified the
provided information either in terms of accuracy or completeness.
What are Some Additional Considerations for Investors?
Investors should be aware of certain other considerations before making
a decision to invest in the Trusts.
The value of the Equity Securities will fluctuate over the life of a
Trust and may be more or less than the price at which they were
deposited in such Trust. The Equity Securities may appreciate or
depreciate in value (or pay dividends) depending on the full range of
economic and market influences affecting these securities.
Neither the Sponsor nor the Trustee shall be liable in any way for any
default, failure or defect in any Security. In the event of a notice
that any Equity Security will not be delivered ("Failed Contract
Obligations") to a Trust, the Sponsor is authorized under the Indenture
to direct the Trustee to acquire other Equity Securities ("Replacement
Securities"). Any Replacement Security will be identical to those which
were the subject of the failed contract. The Replacement Securities must
be purchased within 20 days after delivery of the notice of a failed
contract and the purchase price may not exceed the amount of funds
reserved for the purchase of the Failed Contract Obligations.
If the right of limited substitution described in the preceding
paragraph is not utilized to acquire Replacement Securities in the event
of a failed contract, the Sponsor will refund the sales charge
attributable to such Failed Contract Obligations to all Unit holders of
a Trust and the Trustee will distribute the principal attributable to
such Failed Contract Obligations not more than 120 days after the date
on which the Trustee received a notice from the Sponsor that a
Replacement Security would not be deposited in a Trust. In addition,
Unit holders should be aware that, at the time of receipt of such
principal, they may not be able to reinvest such proceeds in other
securities at a yield equal to or in excess of the yield which such
proceeds would have earned for Unit holders of a Trust.
The Indenture also authorizes the Sponsor to increase the size of a
Trust and the number of Units thereof by the deposit of additional
Equity Securities, or cash (including a letter of credit) with
instructions to purchase additional Equity Securities, in such Trust and
the issuance of a corresponding number of additional Units. If the
Sponsor deposits cash, existing and new investors could experience a
dilution of their investments and a reduction in anticipated income
because of fluctuations in the prices of the Equity Securities between
the time of the cash deposit and the actual purchase of the Equity
Securities and because the Trusts will pay the brokerage fees associated
therewith.
Each Trust consists of the Equity Securities listed under "Schedule of
Investments" for each Trust (or contracts to purchase such Securities)
as may continue to be held from time to time in such Trust and any
additional Equity Securities acquired and held by such Trust pursuant to
the provisions of the Indenture (including provisions with respect to
deposits into such Trust of Equity Securities in connection with the
issuance of additional Units).
Once all of the Equity Securities in a Trust are acquired, the Trustee
will have no power to vary the investments of such Trust, i.e., the
Trustee will have no managerial power to take advantage of market
Page 33
variations to improve a Unit holder's investment, and may dispose of
Equity Securities only under limited circumstances. See "Rights of Units
Holders-How May Equity Securities be Removed from a Trust?"
Like other investment companies, financial and business organizations
and individuals around the world, the Trusts could be adversely affected
if the computer systems used by the Sponsor, Evaluator, Portfolio
Supervisor or Trustee or other service providers to the Trusts do not
properly process and calculate date-related information and data
involving dates of January 1, 2000 and thereafter. This is commonly
known as the "Year 2000 Problem." The Sponsor, Evaluator, Portfolio
Supervisor and Trustee are taking steps that they believe are reasonably
designed to address the Year 2000 Problem with respect to computer
systems that they use and to obtain reasonable assurances that
comparable steps are being taken by each Trust's other service
providers. At this time, however, there can be no assurance that these
steps will be sufficient to avoid any adverse impact to the Trusts.
The Year 2000 Problem is expected to impact corporations, which may
include issuers of the Equity Securities contained in the Trusts to
varying degrees based upon various factors, including, but not limited
to, their industry sector and degree of technological sophistication.
The Sponsor is unable to predict what impact, if any, the Year 2000
Problem will have on issuers of the Equity Securities contained in the
Trusts.
To the best of the Sponsor's knowledge, there is no litigation pending
as of the Initial Date of Deposit in respect of any Equity Security
which might reasonably be expected to have a material adverse effect on
a Trust. At any time after the Initial Date of Deposit, litigation may
be instituted on a variety of grounds with respect to the Equity
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 a Trust.
Legislation. From time to time Congress considers proposals to reduce
the rate of the dividends-received deductions. Enactment into law of a
proposal to reduce the rate would adversely affect the after-tax return
to investors who can take advantage of the deduction. Unit holders are
urged to consult their own tax advisors. Further, at any time after the
Initial Date of Deposit, legislation may be enacted that could
negatively affect the Equity Securities in a Trust or the issuers of the
Equity Securities. Changing approaches to regulation, particularly with
respect to any of the industry sectors represented in a Trust, may have
a negative impact on certain companies represented in a Trust. There can
be no assurance that future legislation, regulation or deregulation will
not have a material adverse effect on the Trusts or will not impair the
ability of the issuers of the Equity Securities to achieve their
business goals.
PUBLIC OFFERING
How is the Public Offering Price Determined?
Units are offered at the Public Offering Price. During the initial
offering period, the Public Offering Price is based on the aggregate
underlying value of the Equity Securities in a Trust (generally
determined by the closing sale prices of listed Equity Securities and
the ask prices of over-the-counter traded Equity Securities), plus or
minus cash, if any, in the Income and Capital Accounts of a Trust, plus
an initial sales charge equal to the difference between the maximum
sales charge of ___% of the Public Offering Price and the maximum
remaining deferred sales charge, initially $ per Unit. Commencing on
______, 1999, and on the twentieth day of each month thereafter (or if
such date is not a business day, on the preceding business day) through
______, 1999, a deferred sales charge of $____ will be assessed per Unit
per month. Units purchased subsequent to the initial deferred sales
charge payment but still during the initial offering period will be
subject to the initial sales charge and the remaining deferred sales
charge payments not yet collected. The deferred sales charge will be
paid from funds in the Income and/or Capital Accounts, if sufficient, or
from the periodic sale of Equity Securities. The total maximum sales
charge assessed to Unit holders on a per Unit basis will be ___% of the
Public Offering Price (equivalent to ___% of the net amount invested,
exclusive of the deferred sales charge). In addition, a portion of the
Public Offering Price on Units purchased prior to the earlier of six
months after the Initial Date of Deposit or the end of the initial
offering period also consists of Equity Securities in an amount
sufficient to pay for all or a portion of the costs incurred in
Page 34
establishing the Trusts, including the costs of preparing the
registration statement, the trust indenture and other closing documents,
registering Units with the Securities and Exchange Commission and
states, the initial audit of a Trust portfolio, legal fees and the
initial fees and expenses of the Trustee. The organizational and
offering costs will be deducted from the assets of each Trust as of the
earlier of six months after the Initial Date of Deposit or the end of
the initial offering period. For secondary market sales after the
completion of the deferred sales charge period, the Public Offering
Price is also based on the aggregate underlying value of the Equity
Securities in a Trust (generally determined by the closing sale prices
of listed Equity Securities and the bid prices of over-the-counter
traded Equity Securities), plus or minus cash, if any, in the Income and
Capital Accounts of a Trust, plus a one-time initial sales charge of
___% of the Public Offering Price (equivalent to ____% of the net amount
invested), which will be reduced by 1/2 of 1% on each subsequent
________, commencing ______, 1999 to a minimum sales charge of 3.0%,
divided by the number of outstanding Units of a Trust.
During the initial offering period, the Sponsor's Repurchase Price is
based on the aggregate underlying value of the Equity Securities in a
Trust (generally determined by the closing sale prices of listed Equity
Securities and the ask prices of over-the-counter traded Equity
Securities), plus or minus cash, if any, in the Income and Capital
Accounts of a Trust, plus, until the earlier of six months after the
Initial Date of Deposit or the end of the initial offering period,
estimated organizational and offering costs, divided by the number of
Units of a Trust outstanding, reduced by the deferred sales charge not
yet paid. During the secondary market, the Sponsor's Repurchase Price is
also based on the aggregate underlying value of the Equity Securities in
a Trust (generally determined by the closing sale prices of listed
Equity Securities and the bid prices of over-the-counter traded Equity
Securities), plus or minus cash, if any, in the Income and Capital
Accounts of a Trust, divided by the number of outstanding Units of a
Trust.
The minimum amount which an investor may purchase of a Trust is $1,000
($500 for Individual Retirement Accounts or other retirement plans). The
applicable sales charge for the Trusts for both primary and secondary
market sales is reduced by a discount as indicated below for aggregate
volume purchases of the Trusts (except for sales made pursuant to a
"wrap fee account" or similar arrangements as set forth below):
Primary and Secondary
_____________________
Percent of Percent of
Dollar Amount of Transaction Offering Net Amount
at Public Offering Price* Price Invested
____________________________ __________ __________
$ 50,000 but less than $100,000 0.25% 0.2506%
$100,000 but less than $250,000 0.50% 0.5025%
$250,000 but less than $500,000 1.00% 1.0101%
$500,000 or more 2.00% 2.0408%
___________
<FN>
* The breakpoint sales charges are also applied on a Unit basis
utilizing a breakpoint equivalent in the above table of $10 per Unit and
will be applied on whichever basis is more favorable to the investor.
The breakpoints will be adjusted to take into consideration purchase
orders stated in dollars which cannot be completely fulfilled due to the
requirement that only whole Units be issued.
</FN>
Any such reduced sales charge shall be the responsibility of the selling
broker/dealer, bank or other selling agent. The reduced sales charge
structure will apply on all purchases of Units of a Trust by the same
person on any one day from any one broker/dealer, bank or other selling
agent. An investor may aggregate purchases of Units of Trusts contained
in this Prospectus and other trusts sponsored by Nike Securities L.P.
which are currently in the initial offering period and which have
substantially the same sales load and years to maturity as the Trusts
for purposes of qualifying for volume purchase discounts listed above.
Unit holders of other unit investment trusts in which the Sponsor acted
as sole Principal Underwriter and which at the time of their creation
had substantially the same sales load and approximately a five-year term
("Eligible Sector Trusts") may utilize their redemption or termination
proceeds from the Eligible Sector Trusts to acquire Units of the Trusts
during the initial offering period subject only to the remaining
deferred sales charge to be collected on such Units. Unit holders who
redeem Units of the Eligible Sector Trusts should note that they will be
assessed the amount of any remaining deferred sales charges on such
units at the time of redemption. 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
broker/dealer, bank or other selling agent of any such combined purchase
Page 35
prior to the sale in order to obtain the indicated discount. In
addition, with respect to the employees, officers and directors
(including their immediate family members, defined as spouses, children,
grandchildren, parents, grandparents, siblings, mothers-in-law, fathers-
in-law, sons-in-law and daughters-in-law, and trustees, custodians or
fiduciaries for the benefit of such persons) of the Sponsor and
broker/dealers, banks or other selling agents and their subsidiaries and
vendors providing services to the Sponsor, Units may be purchased at the
Public Offering Price less the concession the Sponsor typically allows
to dealers and other selling agents.
Units may be purchased in the primary or secondary market at the Public
Offering Price less the concession the Sponsor typically allows to
dealers and other selling agents (see "Public Offering-How are Units
Distributed?") for purchases by investors who purchase Units through
registered investment advisors, certified financial planners or
registered broker/dealers who in each case either charge periodic fees
for financial planning, investment advisory or asset management
services, or provide such services in connection with the establishment
of an investment account for which a comprehensive "wrap fee" charge is
imposed.
Had the Units of the Trusts been available for sale on the business day
prior to the Initial Date of Deposit, the Public Offering Price would
have been as indicated in "Summary of Essential Information." The Public
Offering Price of Units on the date of the prospectus or during the
initial offering period may vary from the amount stated under "Summary
of Essential Information" in accordance with fluctuations in the prices
of the underlying Equity Securities. During the initial offering period,
the aggregate value of the Units of a Trust shall be determined on the
basis of the aggregate underlying value of the Equity Securities therein
plus or minus cash, if any, in the Income and Capital Accounts of a
Trust. The aggregate underlying value of the Equity Securities during
the initial offering period will be determined in the following manner:
if the Equity Securities are listed, this evaluation is generally based
on the closing sale prices on that exchange (unless it is determined
that these prices are inappropriate as a basis for valuation) or, if
there is no closing sale price on that exchange, at the closing ask
prices. If the Equity Securities are not so listed or, if so listed and
the principal market therefor is other than on the exchange, the
evaluation shall generally be based on the current ask prices on the
over-the-counter market (unless it is determined that these prices are
inappropriate as a basis for evaluation). If current ask prices are
unavailable, the evaluation is generally determined (a) on the basis of
current ask prices for comparable securities, (b) by appraising the
value of the Equity Securities on the ask side of the market or (c) by
any combination of the above.
After the completion of the initial offering period, the secondary
market Public Offering Price will be equal to the aggregate underlying
value of the Equity Securities therein, plus or minus cash, if any, in
the Income and Capital Accounts of a Trust plus the applicable sales
charge. The aggregate underlying value of the Equity Securities for
secondary market sales is calculated in the same manner as described
above for sales made during the initial offering period with the
exception that bid prices are used instead of ask prices.
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 the Units on the date of
settlement provided payment has been received. Cash, if any, made
available to the Sponsor prior to the date of settlement for the
purchase of Units may be used in the Sponsor's business and may be
deemed to be a benefit to the Sponsor, subject to the limitations of the
Securities Exchange Act of 1934. Delivery of Certificates representing
Units so ordered will be made 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?
During the initial offering period (i) for Units issued on the Initial
Date of Deposit and (ii) for additional Units issued after such date as
additional Equity Securities or cash are deposited by the Sponsor, Units
will be distributed to the public at the then current Public Offering
Price. The initial offering period may be up to approximately 360 days.
During such period, the Sponsor may deposit additional Equity Securities
or cash in a Trust and create additional Units. Units reacquired by the
Page 36
Sponsor during the initial offering period (at prices based upon the
aggregate underlying value of the Equity Securities in a Trust plus or
minus a pro rata share of cash, if any in the Income and Capital
Accounts of such Trust) may be resold at the then current Public
Offering Price. Upon the termination of the initial offering period,
unsold Units created or reacquired during the initial offering period
will be sold or resold at the then current Public Offering Price.
Upon completion of the initial offering, Units repurchased in the
secondary market (see "Public Offering-Will There be a Secondary
Market?") may be offered by this prospectus at the secondary market
public offering price determined in the manner described above.
It is the intention of the Sponsor to qualify Units of the Trusts for
sale in a number of states. Sales initially will be made to dealers and
other selling agents at prices which represent a concession or agency
commission of 3.2% of the Public Offering Price, and, for secondary
market sales, 3.2% of the Public Offering Price (or 65% of the then
current maximum sales charge after ______, 1999). Dealers and other
selling agents will be allowed a concession or agency commission on the
sale of Units purchased with redemption or termination proceeds from
Eligible Sector Trusts equal to (i) $.22 per Unit on Units sold subject
to a deferred sales charge of $ per Unit or (ii) 63% of the then
current maximum remaining deferred sales charge on Units sold subject to
a deferred sales charge of less than $ per Unit. Volume concessions
or agency commissions of an additional 0.30% of the Public Offering
Price on all purchases of Units of the Trusts will be given to any
broker/dealer or bank who has aggregate purchases of Trust Units from
the Sponsor on the Initial Date of Deposit of at least $100,000 of the
Trusts or purchases $250,000 of any one of such Trusts on any day
thereafter. In addition, dealers and other selling agents will receive
an additional volume concession or agency commission with respect to
sales of Units of each individual Trust in the amounts set forth below:
Additional
Total Sales per Trust Concession
_____________________ __________
$1,000,000 but less than $2,000,000 .10%
$2,000,000 but less than $3,000,000 .15%
$3,000,000 but less than $10,000,000 .20%
$10,000,000 or more .30%
Effective on each ________, commencing ______, 1999, the sales charge
will be reduced by 1/2 of 1% to a minimum sales charge of 3.0%. However,
resales of Units of a Trust by such dealers and other selling agents to
the public will be made at the Public Offering Price described in the
prospectus. The Sponsor reserves the right to change the amount of the
concession or agency commission from time to time. Certain commercial
banks may be making Units of a 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.
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
broker/dealers, banks or other selling agents of a Trust may receive
nominal awards from the Sponsor for each of their registered
representatives who have sold a minimum number of UIT Units during a
specified time period. In addition, at various times the Sponsor may
implement other programs under which the sales force of a broker/dealer,
bank or other selling agent may be eligible to win other nominal awards
for certain sales efforts, or under which the Sponsor will reallow to
any such dealer that sponsors sales contests or recognition programs
conforming to criteria established by the Sponsor, or participates in
sales programs sponsored by the Sponsor, an amount not exceeding the
total applicable sales charges on the sales generated by such person at
the public offering price during such programs. Also, the Sponsor in its
discretion may from time to time pursuant to objective criteria
established by the Sponsor pay fees to qualifying dealers for certain
services or activities which are primarily intended to result in sales
of Units of a Trust. Such payments are made by the Sponsor out of its
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own assets, and not out of the assets of a Trust. These programs will
not change the price Unit holders pay for their Units or the amount that
the Trusts will receive from the Units sold.
The Sponsor may from time to time in its advertising and sales materials
compare the then current estimated returns on the Trusts and returns
over specified periods on other similar trusts sponsored by Nike
Securities L.P. with returns on 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 Trusts. U.S. Government bonds,
for example, are backed by the full faith and credit of the U.S.
Government and bank CDs and money market accounts are insured by an
agency of the federal government. Money market accounts and money market
funds provide stability of principal, but pay interest at rates that
vary with the condition of the short-term debt market. The investment
characteristics of the Trusts are described more fully elsewhere in this
Prospectus.
Information on percentage changes in the dollar value of Units, on the
basis of changes in Unit price may be included from time to time in
advertisements, sales literature, reports and other information
furnished to current or prospective Unit holders. Total return figures
are not averaged, and may not reflect deduction of the sales charge,
which would decrease the return. Average annualized return figures
reflect deduction of the maximum sales charge. No provision is made for
any income taxes payable.
Past performance may not be indicative of future results. Each Trust's
portfolio is not managed. Unit price and return fluctuate with the value
of the common stocks in a Trust's portfolio, so there may be a gain or
loss when Units are sold.
Each Trust's performance may be compared to performance on a total
return basis with the Dow Jones Industrial Average, the S&P 500
Composite Stock Price 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 a Trust's
relative performance for any future period.
What are the Sponsor's Profits?
The Sponsor of the Trusts will receive a gross sales commission equal to
___% of the Public Offering Price of the Units (equivalent to ___% of
the net amount invested, exclusive of the deferred sales charge), less
any reduced sales charge described under "Public Offering-How is the
Public Offering Price Determined?" See "Public Offering-How are Units
Distributed?" for information regarding the receipt of additional
concessions available to dealers and other selling agents. In addition,
the Sponsor may be considered to have realized a profit or to have
sustained a loss, as the case may be, in the amount of any difference
between the cost of the Equity Securities to the Trusts (which is based
on the Evaluator's determination of the aggregate offering price of the
underlying Equity Securities of such Trust on the Initial Date of
Deposit as well as subsequent deposits) and the cost of such Equity
Securities to the Sponsor. See Note (2) of "Schedule of Investments" for
each Trust. During the initial offering period, the dealers and other
selling agents also may realize profits or sustain losses as a result of
fluctuations after the Initial Date of Deposit in the Public Offering
Price received by the dealers and other selling agents upon the sale of
Units.
In maintaining a market for the Units, the Sponsor will also realize
profits or sustain losses in the amount of any difference between the
price at which Units are purchased and the price at which Units are
resold (which price includes a sales charge of ___% subject to reduction
beginning ______, 1999) or redeemed. The secondary market public
offering price of Units may be greater or less than the cost of such
Units to the Sponsor.
Will There be a Secondary Market?
After the initial offering period, although not obligated to do so, the
Sponsor intends to maintain a market for the Units and continuously
offer to purchase Units at prices, subject to change at any time, based
upon the aggregate underlying value of the Equity Securities in a Trust
plus or minus cash, if any, in the Income and Capital Accounts of such
Trust. All expenses incurred in maintaining a secondary market, other
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than the fees of the Evaluator and the costs of the Trustee in
transferring and recording the ownership of Units, will be borne by the
Sponsor. If the supply of Units exceeds demand, or for some other
business reason, the Sponsor may discontinue purchases of Units at such
prices. IF A UNIT HOLDER WISHES TO DISPOSE OF HIS 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. Units subject to a
deferred sales charge which are sold or tendered for redemption prior to
such time as the entire deferred sales charge on such Units has been
collected will be assessed the amount of the remaining deferred sales
charge at the time of sale or redemption.
RIGHTS OF UNIT HOLDERS
How is Evidence of Ownership Issued and Transferred?
The Trustee is authorized to treat as the record owner of Units that
person who is registered as such owner on the books of the Trustee.
Ownership of Units may be evidenced by registered certificates executed
by the Trustee and the Sponsor. Delivery of certificates representing
Units ordered for purchase is normally made three business days
following such order or shortly thereafter. Certificates are
transferable by presentation and surrender to the Trustee properly
endorsed or accompanied by a written instrument or instruments of
transfer. Certificates to be redeemed must be properly endorsed or
accompanied by a written instrument or instruments of transfer. A Unit
holder must sign exactly as his or her name appears on the face of the
certificate with the signature guaranteed by a participant in the
Securities Transfer Agents Medallion Program ("STAMP") or such other
signature guaranty program in addition to, or in substitution for,
STAMP, as may be accepted by the Trustee. In certain instances the
Trustee may require additional documents such as, but not limited to,
trust instruments, certificates of death, appointments as executor or
administrator or certificates of corporate authority. Record ownership
may occur before settlement.
Certificates will be issued in fully registered form, transferable only
on the books of the Trustee in denominations of one Unit or any multiple
thereof, numbered serially for purposes of identification.
Unit holders may elect to hold their Units in uncertificated form. The
Trustee will maintain an account for each such Unit holder and will
credit each such account with the number of Units purchased by that Unit
holder. Within two business days of the issuance or transfer of Units
held in uncertificated form, the Trustee will send to the registered
owner of Units a written initial transaction statement containing a
description of their respective Trust; the number of Units issued or
transferred; the name, address and taxpayer identification number, if
any, of the new registered owner; a notation of any liens and
restrictions of the issuer and any adverse claims to which such Units
are or may be subject or a statement that there are no such liens,
restrictions or adverse claims; and the date the transfer was
registered. Uncertificated Units are transferable through the same
procedures applicable to Units evidenced by certificates (described
above), except that no certificate need be presented to the Trustee and
no certificate will be issued upon the transfer unless requested by the
Unit holder. A Unit holder may at any time request the Trustee to issue
certificates for Units.
Although no such charge is now made or contemplated, a Unit holder may
be required to pay $2.00 to the Trustee per certificate reissued or
transferred and to pay any governmental charge that may be imposed in
connection with each such transfer or exchange. For new certificates
issued to replace destroyed, stolen or lost certificates, the Unit
holder may be required to furnish indemnity satisfactory to the Trustee
and pay such expenses as the Trustee may incur. Mutilated certificates
must be surrendered to the Trustee for replacement.
How are Income and Capital Distributed?
The Trustee will distribute any net income received with respect to any
of the securities in a Trust on or about the Income Distribution Dates
to Unit holders of record on the preceding Income Distribution Record
Date. See "Summary of Essential Information." Persons who purchase Units
will commence receiving distributions only after such person becomes a
record owner. Notification to the Trustee of the transfer of Units is
the responsibility of the purchaser, but in the normal course of
business such notice is provided by the selling broker-dealer. The pro
rata share of cash in the Capital Account of a Trust will be computed as
of the fifteenth day of each month. Proceeds received on the sale of any
Page 39
Equity Securities in a Trust, to the extent not used to meet redemptions
of Units or pay expenses, will, however, be distributed on the last day
of each month to Unit holders of record on the fifteenth day of such
month if the amount available for distribution equals at least $1.00 per
100 Units. The Trustee is not required to pay interest on funds held in
the Capital Account of a Trust (but may itself earn interest thereon and
therefore benefit from the use of such funds). Notwithstanding,
distributions of funds in the Capital Account, if any, will be made on
the last day of each December to Unit holders of record as of December
15. See "What is the Federal Tax Status of Unit Holders?"
It is anticipated that the deferred sales charge will be collected from
the Capital Account and that amounts in the Capital Account will be
sufficient to cover the cost of the deferred sales charge. However, to
the extent that amounts in the Capital Account are insufficient to
satisfy the then current deferred sales charge obligation, Equity
Securities may be sold to meet such shortfall. Distributions of amounts
necessary to pay the deferred portion of the sales charge will be made
to an account designated by the Sponsor for purposes of satisfying Unit
holders' deferred sales charge obligations.
Under regulations issued by the Internal Revenue Service, the Trustee is
required to withhold a specified percentage of any distribution made by
a Trust if the Trustee has not been furnished the Unit holder's tax
identification number in the manner required by such regulations. Any
amount so withheld is transmitted to the Internal Revenue Service and
may be recovered by the Unit holder only when filing a tax return. Under
normal circumstances the Trustee obtains the Unit holder's tax
identification number from the selling broker. However, a Unit holder
should examine his or her statements from the Trustee to make sure that
the Trustee has been provided a certified tax identification number in
order to avoid this possible "back-up withholding." In the event the
Trustee has not been previously provided such number, one should be
provided as soon as possible.
Within a reasonable time after each Trust is terminated, each Unit
holder will, upon surrender of his or her Units for redemption, receive:
(i) the pro rata share of the amounts realized upon the disposition of
Equity Securities, unless he or she elects an In-Kind Distribution as
described under "Other Information-How May the Indenture be Amended or
Terminated?" and (ii) a pro rata share of any other assets of a Trust,
less expenses of such Trust.
The Trustee will credit to the Income Account of a Trust any dividends
received on the Equity Securities therein. All other receipts (e.g.
return of capital, etc.) are credited to the Capital Account of each
Trust.
The Trustee may establish reserves (the "Reserve Account") within each
Trust for state and local taxes, if any, and any governmental charges
payable out of a Trust.
Distribution Reinvestment Option. Any Unit holder may elect to have each
distribution of income or capital on his or her Units, other than the
final liquidating distribution in connection with the termination of the
Trust, automatically reinvested in additional Units of the Trust. Each
person who purchases Units of the Trust may elect to become a
participant in the Distribution Reinvestment Option by notifying the
Trustee of their election. The Distribution Reinvestment Option may not
be available in all states. In order to enable a Unit holder to
participate in the Distribution Reinvestment Option with respect to a
particular distribution on his or her Units, the card must be received
by the Trustee within 10 days prior to the Record Date for such
distribution. Each subsequent distribution of income or capital on the
participant's Units will be automatically applied by the Trustee to
purchase additional Units of the Trust. IT SHOULD BE REMEMBERED THAT
EVEN IF DISTRIBUTIONS ARE REINVESTED, THEY ARE STILL TREATED AS
DISTRIBUTIONS FOR INCOME TAX PURPOSES.
What Reports will Unit Holders Receive?
The Trustee shall furnish Unit holders in connection with each
distribution a statement of the amount of income, if any, and the amount
of other receipts, if any, which are being distributed, expressed in
each case as a dollar amount per Unit. Within a reasonable period of
time after the end of each calendar year, the Trustee shall furnish to
each person who at any time during the calendar year was a Unit holder
of a Trust the following information in reasonable detail: (1) a summary
of transactions in such Trust for such year; (2) any Equity Securities
sold during the year and the Equity Securities held at the end of such
year by such Trust; (3) the redemption price per Unit based upon a
computation thereof on the 31st day of December of such year (or the
last business day prior thereto); and (4) amounts of income and capital
distributed during such year.
Page 40
In order to comply with Federal and state tax reporting requirements,
Unit holders will be furnished, upon request to the Trustee, evaluations
of the Securities in the Trusts furnished to it by the Evaluator.
How May Units be Redeemed?
A Unit holder may redeem all or a portion of his or her Units by tender
to the Trustee at its unit investment trust office in the City of New
York of the certificates representing the Units to be redeemed, or in
the case of uncertificated Units, delivery of a request for redemption,
duly endorsed or accompanied by proper instruments of transfer with
signature guaranteed as explained above (or by providing satisfactory
indemnity, as in connection with lost, stolen or destroyed
certificates), and payment of applicable governmental charges, if any.
No redemption fee will be charged. On the 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 "date
of tender" is deemed to be the date on which Units are received by the
Trustee (if such day is a day on which the New York Stock Exchange is
open for trading), except that as regards Units received after 4:00 p.m.
Eastern time (or as of any earlier closing time on a day on which the
New York Stock Exchange is scheduled in advance to close at such earlier
time), the date of tender is the next day on which the New York Stock
Exchange is open for trading and such Units will be deemed to have been
tendered to the Trustee on such day for redemption at the redemption
price computed on that day. Units so redeemed shall be cancelled. Units
tendered for redemption prior to such time as the entire deferred sales
charge on such Units has been collected will be assessed the amount of
the remaining deferred sales charge at the time of redemption.
Any Unit holder tendering 1,000 Units or more of a Trust for redemption
may request by written notice submitted at the time of tender from the
Trustee in lieu of a cash redemption a distribution of shares of Equity
Securities in an amount and value of Equity Securities per Unit equal to
the Redemption Price Per Unit as determined as of the evaluation next
following tender. However, no In-Kind Distribution requests submitted
during the nine business days prior to the Mandatory Termination Date
will be honored. To the extent possible, in-kind distributions ("In-Kind
Distributions") shall be made by the Trustee through the distribution of
each of the Equity Securities in book-entry form to the account of the
Unit holder's bank or broker-dealer at the Depository Trust Company. An
In-Kind Distribution will be reduced by customary transfer and
registration charges. The tendering Unit holder will receive his or her
pro rata number of whole shares of each of the Equity Securities
comprising the portfolio and cash from the Capital Account equal to the
fractional shares to which the tendering Unit holder is entitled. The
Trustee may adjust the number of shares of any issue of Equity
Securities included in a Unit holder's In-Kind Distribution to
facilitate the distribution of whole shares, such adjustment to be made
on the basis of the value of Equity Securities on the date of tender.
See "What is the Federal Tax Status of Unit Holders?" If funds in the
Capital Account are insufficient to cover the required cash distribution
to the tendering Unit holder, the Trustee may sell Equity Securities in
the manner described above.
Under regulations issued by the Internal Revenue Service, the Trustee is
required to withhold a specified percentage of the principal amount of a
Unit redemption if the Trustee has not been furnished the redeeming Unit
holder's tax identification number in the manner required by such
regulations. For further information regarding this withholding, see
"Rights of Unit Holders-How are Income and Capital Distributed?" In the
event the Trustee has not been previously provided such number, one must
be provided at the time redemption is requested.
Any amounts paid on redemption representing income shall be withdrawn
from the Income Account of a Trust to the extent that funds are
available for such purpose, or from the Capital Account. All other
amounts paid on redemption shall be withdrawn from the Capital Account
of each Trust.
The Trustee is empowered to sell Equity Securities of each Trust in
order to make funds available for redemption. To the extent that Equity
Securities are sold, the size and diversity of each Trust will be
reduced. Such sales may be required at a time when Equity Securities
would not otherwise be sold and might result in lower prices than might
otherwise be realized.
The Redemption Price per Unit will be determined on the basis of the
aggregate underlying value of the Equity Securities in a Trust plus or
minus cash, if any, in the Income and Capital Accounts of such Trust.
The Redemption Price per Unit is the pro rata share of each Unit
Page 41
determined by the Trustee by adding: (1) the cash on hand in a Trust
other than cash deposited in a Trust to purchase Equity Securities not
applied to the purchase of such Equity Securities; (2) the aggregate
value of the Equity Securities held in a Trust, as determined by the
Evaluator on the basis of the aggregate underlying value of the Equity
Securities in such Trust next computed; and (3) dividends receivable on
the Equity Securities trading ex-dividend as of the date of computation;
and deducting therefrom: (1) amounts representing any applicable taxes
or governmental charges payable out of the Trust; (2) any amounts owing
to the Trustee for its advances; (3) an amount representing estimated
accrued expenses of a Trust, including but not limited to fees and
expenses of the Trustee (including legal and auditing fees), the
Evaluator and supervisory fees, if any; (4) cash held for distribution
to Unit holders of record of a Trust as of the business day prior to the
evaluation being made; and (5) other liabilities incurred by a Trust;
and finally dividing the results of such computation by the number of
Units of the Trust outstanding as of the date thereof. The redemption
price per Unit will be assessed the amount, if any, of the remaining
deferred sales charge at the time of redemption. Until the earlier of
six months after the Initial Date of Deposit or the end of the initial
offering period, the Redemption Price per Unit will include estimated
organizational and offering costs as set forth under "Summary of
Essential Information" for each Trust.
The aggregate value of the Equity Securities used to calculate the
Redemption Price per Unit will be determined in the following manner: if
the Equity Securities are listed, this evaluation is generally based on
the closing sale prices on that exchange (unless it is determined that
these prices are inappropriate as a basis for valuation) or, if there is
no closing sale price on that exchange, at the closing ask prices
(during the initial offering period) or the closing bid prices
(subsequent to the initial offering period). If the Equity Securities
are not so listed or, if so listed and the principal market therefor is
other than on the exchange, the evaluation shall generally be based on
the current ask or bid prices (as appropriate) on the over-the-counter
market (unless these prices are inappropriate as a basis for
evaluation). If current ask or bid prices (as appropriate) are
unavailable, the evaluation is generally determined (a) on the basis of
current ask or bid prices (as appropriate) for comparable securities,
(b) by appraising the value of the Equity Securities on the ask or bid
side of the market (as appropriate) or (c) by any combination of the
above.
The right of redemption may be suspended and payment postponed for any
period during which the New York Stock Exchange is closed, other than
for customary weekend and holiday closings, or during which the
Securities and Exchange Commission determines that trading on the New
York Stock Exchange is restricted or any emergency exists, as a result
of which disposal or evaluation of the Securities is not reasonably
practicable, or for such other periods as the Securities and Exchange
Commission may by order permit. Under certain extreme circumstances, the
Sponsor may apply to the Securities and Exchange Commission for an order
permitting a full or partial suspension of the right of Unit holders to
redeem their Units. The Trustee is not liable to any person in any way
for any loss or damage which may result from any such suspension or
postponement.
How May Units be Purchased by the Sponsor?
The Trustee shall notify the Sponsor of any tender of Units for
redemption. If the Sponsor's bid in the secondary market at that time
equals or exceeds the Redemption Price per Unit, it may purchase such
Units by notifying the Trustee before 1:00 p.m. Eastern time on the same
business day and by making payment therefor to the Unit holder not later
than the day on which the Units would otherwise have been redeemed by
the Trustee. Units held by the Sponsor may be tendered to the Trustee
for redemption as any other Units. In the event the Sponsor does not
purchase Units, the Trustee may sell Units tendered for redemption in
the over-the-counter market, if any, as long as the amount to be
received by the Unit holder is equal to the amount he 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 42
How May Equity Securities be Removed from a Trust?
The Portfolios of the Trusts are not "managed" by the Sponsor or the
Trustee; their activities described herein are governed solely by the
provisions of the Indenture. The Indenture provides that the Sponsor may
(but need not) direct the Trustee to dispose of an Equity Security in
the event that an issuer defaults in the payment of a dividend that has
been declared, that any action or proceeding has been instituted
restraining the payment of dividends or there exists any legal question
or impediment affecting such Equity Security, that the issuer of the
Equity Security has breached a covenant which would affect the payments
of dividends, the credit standing of the issuer or otherwise impair the
sound investment character of the Equity Security, that the issuer has
defaulted on the payment on any other of its outstanding obligations,
that the price of the Equity Security has declined to such an extent or
other such credit factors exist so that in the opinion of the Sponsor,
the retention of such Equity Securities would be detrimental to a Trust.
Except as stated under "Portfolio-What are Some Additional
Considerations for Investors?" for Failed Contract Obligations, the
acquisition by a Trust of any securities or other property other than
the Equity Securities is prohibited. Pursuant to the Indenture and with
limited exceptions, the Trustee may sell any securities or other
property acquired in exchange for Equity Securities such as those
acquired in connection with a merger or other transaction. If offered
such new or exchanged securities or property, the Trustee shall reject
the offer. However, in the event such securities or property are
nonetheless acquired by a Trust, they may be accepted for deposit in a
Trust and either sold by the Trustee or held in a Trust pursuant to the
direction of the Sponsor (who may rely on the advice of the Portfolio
Supervisor). Proceeds from the sale of Equity Securities (or any
securities or other property received by a Trust in exchange for Equity
Securities) by the Trustee are credited to the Capital Account of a
Trust for distribution to Unit holders or to meet redemptions. The
Trustee may, from time to time, retain and pay compensation to the
Sponsor (or an affiliate of the Sponsor) to act as agent for the Trusts
with respect to selling Equity Securities from the Trusts. In acting in
such capacity, the Sponsor or its affiliate will be held subject to the
restrictions under the Investment Company Act of 1940, as amended.
The Trustee may also sell Equity Securities designated by the Sponsor,
or if not so directed, in its own discretion, for the purpose of
redeeming Units of a Trust tendered for redemption and the payment of
expenses.
The Sponsor, in designating Equity Securities to be sold by the Trustee,
will generally make selections in order to maintain, to the extent
practicable, the proportionate relationship among the number of shares
of individual issues of Equity Securities. To the extent this is not
practicable, the composition and diversity of the Equity Securities may
be altered. In order to obtain the best price for a Trust, it may be
necessary for the Sponsor to specify minimum amounts (generally 100
shares) in which blocks of Equity Securities are to be sold. The Sponsor
may consider sales of Units of unit investment trusts which it sponsors
in making recommendations to the Trustee as to the selection of
broker/dealers to execute the Trusts' portfolio transactions.
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 FT Series (formerly known as 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 $20 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 (630) 241-4141. As of December 31, 1997, the total
Page 43
partners' capital of Nike Securities L.P. was $11,724,071 (audited).
(This paragraph relates only to the Sponsor and not to the Trusts or to
any series thereof or to any other dealer. 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 Chase Manhattan Bank, with its principal executive
office located at 270 Park Avenue, New York, New York 10017 and its unit
investment trust office at 4 New York Plaza, 6th floor, New York, New
York 10004-2413. Unit holders who have questions regarding the Trusts
may call the Customer Service Help Line at 1-800-682-7520. The Trustee
is subject to supervision by the Superintendent of Banks of the State of
New York, the Federal Deposit Insurance Corporation and the Board of
Governors of the Federal Reserve System.
The Trustee, whose duties are ministerial in nature, has not
participated in the selection of the Equity Securities. For information
relating to the responsibilities of the Trustee under the Indenture,
reference is made to the material set forth under "Rights of Unit
Holders."
The Trustee and any successor trustee may resign by executing an
instrument in writing and filing the same with the Sponsor and mailing a
copy of a notice of resignation to all Unit holders. Upon receipt of
such notice, the Sponsor is obligated to appoint a successor trustee
promptly. If the Trustee becomes incapable of acting or becomes bankrupt
or its affairs are taken over by public authorities, the Sponsor may
remove the Trustee and appoint a successor as provided in the Indenture.
If upon resignation of a trustee no successor has accepted the
appointment within 30 days after notification, the retiring trustee may
apply to a court of competent jurisdiction for the appointment of a
successor. The resignation or removal of a trustee becomes effective
only when the successor trustee accepts its appointment as such or when
a court of competent jurisdiction appoints a successor trustee.
Any corporation into which a Trustee may be merged or with which it may
be consolidated, or any corporation resulting from any merger or
consolidation to which a Trustee shall be a party, shall be the
successor Trustee. The Trustee must be a banking corporation organized
under the laws of the United States or any State and having at all times
an aggregate capital, surplus and undivided profits of not less than
$5,000,000.
Limitations on Liabilities of Sponsor and Trustee
The Sponsor and the Trustee shall be under no liability to Unit holders
for taking any action or for refraining from taking any action in good
faith pursuant to the Indenture, or for errors in judgment, but shall be
liable only for their own willful misfeasance, bad faith, gross
negligence (ordinary negligence in the case of the Trustee) or reckless
disregard of their obligations and duties. The Trustee shall not be
liable for depreciation or loss incurred by reason of the sale by the
Trustee of any of the Equity 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 becomes incapable of acting or becomes bankrupt or its
affairs are taken over by public authorities, then the Trustee may (a)
appoint a successor Sponsor at rates of compensation deemed by the
Trustee to be reasonable and not exceeding amounts prescribed by the
Securities and Exchange Commission, or (b) terminate the Indenture and
liquidate the Trust as provided herein, or (c) continue to act as
Trustee without terminating the Indenture.
Who is the Evaluator?
The Evaluator is First Trust Advisors L.P., an Illinois limited
partnership formed in 1991 and an affiliate of the Sponsor. The
Evaluator's address is 1001 Warrenville Road, Lisle, Illinois 60532. The
Page 44
Evaluator may resign or may be removed by the Sponsor or 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 a Trust shall terminate upon the Mandatory
Termination Date indicated herein under "Summary of Essential
Information." A Trust may be liquidated at any time by consent of 100%
of the Unit holders of a Trust or by the Trustee when the value of the
Equity Securities owned by a Trust as shown by any evaluation, is less
than the lower of $2,000,000 or 20% of the total value of Equity
Securities deposited in such Trust during the initial offering period,
or in the event that Units of a Trust not yet sold aggregating more than
60% of the Units of such Trust are tendered for redemption by a
broker/dealer, including the Sponsor. If a Trust is liquidated because
of the redemption of unsold Units of such Trust by a broker/dealer, the
Sponsor will refund to each purchaser of Units of such 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 such Trust. Within a reasonable period after termination, the Trustee
will follow the procedures set forth under "Rights of Unit Holders-How
are Income and Capital Distributed?"
Commencing during the period beginning nine business days prior to, and
no later than, the Mandatory Termination Date, Equity Securities will
begin to be sold in connection with the termination of a Trust. The
Sponsor will determine the manner, timing and execution of the sale of
the Equity Securities. Written notice of any termination of a Trust
specifying the time or times at which Unit holders may surrender their
certificates for cancellation shall be given by the Trustee to each Unit
holder at his or her address appearing on the registration books of the
Trust maintained by the Trustee. At least 60 days prior to the Mandatory
Termination Date of a Trust the Trustee will provide written notice
thereof to all Unit holders and will include with such notice a form to
enable Unit holders to elect a distribution of shares of Equity
Securities (reduced by customary transfer and registration charges), if
such Unit holder owns at least 1,000 Units of such Trust, rather than to
receive payment in cash for such Unit holder's pro rata share of the
amounts realized upon the disposition by the Trustee of Equity
Securities. To be effective, the election form, together with
surrendered certificates and other documentation required by the
Trustee, must be returned to the Trustee at least ten business days
prior to the Mandatory Termination Date of a Trust. Unit holders not
electing or eligible to receive a distribution of shares of Equity
Securities will receive a cash distribution from the sale of the
remaining Equity Securities within a reasonable time after a Trust is
terminated. Regardless of the distribution involved, the Trustee will
deduct from the funds of such Trust any accrued costs, expenses,
advances or indemnities provided by the Indenture, including estimated
compensation of the Trustee and costs of liquidation and any amounts
required as a reserve to provide for payment of any applicable taxes or
other governmental charges. Any sale of Equity Securities in a Trust in
connection with termination may result in a lower amount than might
Page 45
otherwise be realized if such sale were not required at such time. In
addition, to the extent that Equity Securities are sold prior to the
Mandatory Termination Date, Unit holders will not benefit from any stock
appreciation they would have received had the Equity Securities not been
sold at such time. The Trustee will then distribute to each Unit holder
his or her pro rata share of the balance of the Income and Capital
Accounts.
Legal Opinions
The legality of the Units offered hereby and certain matters relating to
Federal tax law have been passed upon by Chapman and Cutler, 111 West
Monroe Street, Chicago, Illinois 60603, as counsel for the Sponsor.
Carter, Ledyard & Milburn, will act as counsel for the Trustee and as
special New York tax counsel for the Trusts.
Experts
The statements of net assets, including the schedules of investments, of
the Trusts at the opening of business on the Initial Date of Deposit
appearing in this Prospectus and Registration Statement, have been
audited by Ernst & Young LLP, independent auditors, as set forth in
their report thereon appearing elsewhere herein and in the Registration
Statement, and are included in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing.
Page 46
REPORT OF INDEPENDENT AUDITORS
The Sponsor, Nike Securities L.P., and Unit Holders
FT 291
We have audited the accompanying statements of net assets, including the
schedules of investments, of FT 291, comprised of America's Leading
Brands Growth Trust, Series 4, Auto & Transportation Growth Trust
Series, Communications Growth Trust, Series 3, Internet Growth Trust,
Series 5 and Regional Bank & Thrift Growth Trust, Series 2, as of the
opening of business on ____________, 1998. These statements of net
assets are the responsibility of the Trusts' Sponsor. Our responsibility
is to express an opinion on these statements of net assets based on our
audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the statements of net assets
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
statements of net assets. Our procedures included confirmation of the
letter of credit allocated among the Trusts on ____________, 1998. An
audit also includes assessing the accounting principles used and
significant estimates made by the Sponsor, as well as evaluating the
overall presentation of the statements of net assets. We believe that
our audit of the statements of net assets provides a reasonable basis
for our opinion.
In our opinion, the statements of net assets referred to above present
fairly, in all material respects, the financial position of FT 291,
comprised of America's Leading Brands Growth Trust, Series 4, Auto &
Transportation Growth Trust Series, Communications Growth Trust, Series
3, Internet Growth Trust, Series 5 and Regional Bank & Thrift Growth
Trust, Series 2, at the opening of business on ____________, 1998 in
conformity with generally accepted accounting principles.
ERNST & YOUNG LLP
Chicago, Illinois
____________, 1998
Page 47
Statements of Net Assets
FT 291
At the Opening of Business on the
Initial Date of Deposit-____________, 1998
America's Auto &
Leading Transportation Communications
Brands Growth Growth Trust Growth Trust
Trust, Series 4 Series Series 3
_______________ ______________ ______________
NET ASSETS
Investment in Equity Securities represented
by purchase contracts (1) (2) $ $ $
Less accrued organizational and offering costs (3) ( ) ( ) ( )
Less liability for deferred sales charge (4) ( ) ( ) ( )
________ ________ ________
Net assets $ $ $
======== ======== ========
Units outstanding
ANALYSIS OF NET ASSETS
Cost to investors (5) $ $ $
Less sales charge (5) ( ) ( ) ( )
Less estimated organizational and offering costs (3) ( ) ( ) ( )
________ ________ ________
Net assets $ $ $
======== ======== ========
<FN>
NOTES TO STATEMENT OF NET ASSETS
(1) Aggregate cost of the Equity Securities listed under "Schedule of
Investments" for each Trust is based on their aggregate underlying value.
(2) An irrevocable letter of credit totaling $ issued
by The Chase Manhattan Bank, which will be allocated among each of the
six Trusts in FT 291, has been deposited with the Trustee as collateral,
which is sufficient to cover the monies necessary for the purchase of
the Equity Securities pursuant to contracts for the purchase of such
Equity Securities.
(3) A portion of the Public Offering Price on Units purchased prior to
the earlier of six months after the Initial Date of Deposit or the end
of the initial offering period consists of Equity Securities in an
amount sufficient to pay for all or a portion of the costs incurred in
establishing the Trusts. These costs have been estimated at $
per Unit for each Trust, based upon the expected number of Units of
each Trust to be created. A distribution will be made at the earlier of
six months after the Initial Date of Deposit or the end of the initial
offering period to an account maintained by the Trustee from which the
organizational and offering cost obligation of the investors to the
Sponsor will be satisfied. To the extent the number of Units of a Trust
is larger or smaller than the estimate, the actual distribution per Unit
for such Trust may differ from that set forth above.
(4) Represents the amount of mandatory distributions from each Trust
($ per Unit), payable to the Sponsor in five equal monthly
installments beginning on ______, 1999, and on the twentieth day of each
month thereafter (or if such date is not a business day, on the
preceding business day) through ______, 1999. If Units are redeemed
prior to ______, 1999, the remaining amount of the deferred sales charge
applicable to such Units will be payable at the time of redemption.
(5) The aggregate cost to investors includes a sales charge computed at
the rate of ___% of the Public Offering Price (equivalent to ___% of the
net amount invested, exclusive of the deferred sales charge), assuming
no reduction of sales charge as set forth under "Public Offering-How is
the Public Offering Price Determined?"
</FN>
Page 48
Statements of Net Assets (con't.)
FT 291
At the Opening of Business on the
Initial Date of Deposit-____________, 1998
Regional
Internet Bank & Thrift
Growth Trust Growth Trust
Series 5 Series 2
____________ ____________
NET ASSETS
Investment in Equity Securities represented
by purchase contracts (1) (2) $ $
Less accrued organizational and offering costs (3) ( ) ( )
Less liability for deferred sales charge (4) ( ) ( )
________ ________
Net assets $ $
======== ========
Units outstanding
ANALYSIS OF NET ASSETS
Cost to investors (5) $ $
Less sales charge (5) ( ) ( )
Less estimated organizational and offering costs (3) ( ) ( )
________ ________
Net assets $ $
======== ========
<FN>
NOTES TO STATEMENT OF NET ASSETS
(1) Aggregate cost of the Equity Securities listed under "Schedule of
Investments" for each Trust is based on their aggregate underlying value.
(2) An irrevocable letter of credit totaling $ issued
by The Chase Manhattan Bank, which will be allocated among each of the
six Trusts in FT 291, has been deposited with the Trustee as collateral,
which is sufficient to cover the monies necessary for the purchase of
the Equity Securities pursuant to contracts for the purchase of such
Equity Securities.
(3) A portion of the Public Offering Price on Units purchased prior to
the earlier of six months after the Initial Date of Deposit or the end
of the initial offering period consists of Equity Securities in an
amount sufficient to pay for all or a portion of the costs incurred in
establishing the Trusts. These costs have been estimated at $
per Unit for each Trust, based upon the expected number of Units of
each Trust to be created. A distribution will be made at the earlier of
six months after the Initial Date of Deposit or the end of the initial
offering period to an account maintained by the Trustee from which the
organizational and offering cost obligation of the investors to the
Sponsor will be satisfied. To the extent the number of Units of a Trust
is larger or smaller than the estimate, the actual distribution per Unit
for such Trust may differ from that set forth above.
(4) Represents the amount of mandatory distributions from each Trust ($
per Unit), payable to the Sponsor in five equal monthly
installments beginning on ______, 1999, and on the twentieth day of each
month thereafter (or if such date is not a business day, on the
preceding business day) through ______, 1999. If Units are redeemed
prior to ______, 1999, the remaining amount of the deferred sales charge
applicable to such Units will be payable at the time of redemption.
(5) The aggregate cost to investors includes a sales charge computed at
the rate of ___% of the Public Offering Price (equivalent to ___% of the
net amount invested, exclusive of the deferred sales charge), assuming
no reduction of sales charge as set forth under "Public Offering-How is
the Public Offering Price Determined?"
</FN>
Page 49
Schedule of Investments
AMERICA'S LEADING BRANDS GROWTH TRUST, SERIES 4
FT 291
At the Opening of Business on the
Initial Date of Deposit-____________, 1998
Approximate
Percentage Market Cost of
of Aggregate Value Equity
Number Ticker Symbol and Offering per Securities
of Shares Name of Issuer of Equity Securities (1) Price (3) Share to Trust (2)
_________ _______________________________________ ____________ ______ ____________
Apparel
_______
NAUT Nautica Enterprises, Inc. % $ $
TOM Tommy Hilfiger Corporation %
Beverages
_________
BUD Anheuser-Busch Companies, Inc. %
KO The Coca-Cola Company %
PEP PepsiCo, Inc. %
Entertainment
_____________
DIS The Walt Disney Company %
Food
____
CPB Campbell Soup Company %
HNZ H.J. Heinz Company %
HSY Hershey Foods Corporation %
SLE Sara Lee Corporation %
Household Products
__________________
CLX The Clorox Company %
CL Colgate-Palmolive Company %
PG The Procter & Gamble Company %
Pharmaceuticals
______________
BMY Bristol-Myers Squibb Company %
JNJ Johnson & Johnson %
SGP Schering-Plough Corporation %
Recreation
__________
CCL Carnival Corporation %
HDI Harley-Davidson, Inc. %
Restaurants
___________
MCD McDonald's Corporation %
SBUX Starbucks Corporation %
Retail
______
GPS The Gap, Inc. %
Technology
__________
INTC Intel Corporation %
Tobacco
_______
MO Philip Morris Companies, Inc. %
Toiletries/Cosmetics
____________________
G The Gillette Company %
Toys
____
MAT Mattel, Inc. %
______ _________
Total Investments 100% $
====== =========
____________
<FN>
(1) All Equity Securities are represented by regular way contracts to
purchase such Equity Securities for the performance of which an
irrevocable letter of credit has been deposited with the Trustee. The
contracts to purchase Equity Securities were entered into by the Sponsor
on ______, 1998.
(2) The cost of the Equity Securities to the Trust represents the
aggregate underlying value with respect to the Equity Securities
acquired (generally determined by the last sale prices of the listed
Equity Securities and the ask prices of the over-the-counter traded
Equity Securities on the business day preceding the Initial Date of
Deposit). The valuation of the Equity Securities has been determined by
the Evaluator, an affiliate of the Sponsor. The aggregate underlying
value of the Equity Securities on the Initial Date of Deposit was $ .
Cost and loss to Sponsor relating to the Equity Securities sold to the
Trust were $ and $ , respectively.
(3) The portfolio may contain additional Equity Securities each of which
will not exceed approximately ___% of the Aggregate Offering Price.
Although it is not the Sponsor's intention, certain of the Equity
Securities listed above may not be included in the final portfolio.
Also, the percentages of the Aggregate Offering Price for the Equity
Securities are approximate amounts and may vary in the final portfolio.
</FN>
Page 50
Schedule of Investments
AUTO & TRANSPORTATION GROWTH TRUST SERIES
FT 291
At the Opening of Business on the
Initial Date of Deposit-____________, 1998
Approximate
Percentage Market Cost of
Number of Aggregate Value Equity
of Ticker Symbol and Offering per Securities
Shares Name of Issuer of Equity Securities (1) Price (3) Share to Trust (2)
______ _______________________________________ ____________ ______ ____________
Air Freight
___________
ABF Airborne Freight Corporation % $ $
AEIC Air Express International Corporation %
EXPD Expeditors International of Washington, Inc. %
Airlines
________
AMR AMR Corporation %
ASAI ASA Holdings, Inc. %
COMR Comair Holdings, Inc. %
IDAL Delta Air Lines, Inc. %
MEH Midwest Express Holdings, Inc. %
LUV Southwest Airlines Company %
UAL UAL Corporation %
Motor Vehicles
______________
C Chrysler Corporation %
F Ford Motor Company %
HDI Harley-Davidson Company %
HMC Honda Motor Company, Limited (ADR) %
NAV Navistar International Corporation %
PCAR PACCAR, Inc. %
Motor Vehicles - Parts and Accessories
_____________________________________
DCN Dana Corporation %
ETN Eaton Corporation %
GNTX Gentex Corporation %
GT The Goodyear Tire & Rubber Company %
JCI Johnson Controls, Inc. %
LEA Lear Corporation %
TWR Tower Automotive, Inc. %
Railroads
_________
BNI Burlington Northern Santa Fe Corporation %
NSC Norfolk Southern Corporation %
WCLX Wisconsin Central Transportation Corporation %
Trucking
_________
HTLD Heartland Express, Inc. %
MSCA M.S. Carriers, Inc. %
SWFT Swift Transportation Company, Inc. %
WERN Werner Enterprises, Inc. %
_____ _________
Total Investments 100% $
===== =========
_______________
<FN>
(1) All Equity Securities are represented by regular way contracts to
purchase such Equity Securities for the performance of which an
irrevocable letter of credit has been deposited with the Trustee. The
contracts to purchase Equity Securities were entered into by the Sponsor
on ______, 1998.
(2) The cost of the Equity Securities to the Trust represents the
aggregate underlying value with respect to the Equity Securities
acquired (generally determined by the last sale prices of the listed
Equity Securities and the ask prices of the over-the-counter traded
Equity Securities on the business day preceding the Initial Date of
Deposit). The valuation of the Equity Securities has been determined by
the Evaluator, an affiliate of the Sponsor. The aggregate underlying
value of the Equity Securities on the Initial Date of Deposit was $ .
Cost and loss to Sponsor relating to the Equity Securities sold to the
Trust were $ and $ , respectively.
(3) The portfolio may contain additional Equity Securities each of which
will not exceed approximately % of the Aggregate Offering Price.
Although it is not the Sponsor's intention, certain of the Equity
Securities listed above may not be included in the final portfolio.
Also, the percentages of the Aggregate Offering Price for the Equity
Securities are approximate amounts and may vary in the final portfolio.
</FN>
Page 51
Schedule of Investments
COMMUNICATIONS GROWTH TRUST, SERIES 3
FT 291
At the Opening of Business on the
Initial Date of Deposit-____________, 1998
Approximate
Percentage Market Cost of
of Aggregate Value Equity
Number Ticker Symbol and Offering per Securities
of Shares Name of Issuer of Equity Securities (1) Price (3) Share to Trust (2)
_________ _______________________________________ ____________ ______ ____________
Cable TV
________
CMCSK Comcast Corporation (Class A Special) % $ $
UMG MediaOne Group, Inc. %
Computer Networking
___________________
COMS 3Com Corporation %
ASND Ascend Communications, Inc. %
CSCO Cisco Systems, Inc. %
Communications Equipment
________________________
ADCT ADC Telecommunications, Inc. %
ASPT Aspect Telecommunications Corporation %
CMVT Comverse Technology, Inc. %
LU Lucent Technologies, Inc. %
NT Northern Telecom Ltd. %
TLAB Tellabs, Inc. %
Communications Services
________________________
ATI ALLTEL Corporation %
AT AirTouch Communications, Inc. %
BEL Bell Atlantic Corporation %
BLS BellSouth Corporation %
CWP Cable & Wireless Plc (ADR) %
DT Deutsche Telekom AG (ADR) %
WCOM MCI WorldCom, Inc. %
QWST Qwest Communications International, Inc. %
SBC SBC Communications, Inc. %
TEF Telefonica de Espana SA (ADR) %
Wireless Communications
_______________________
ERICY LM Ericsson AB (ADR) %
NOK/A Nokia Oy (ADR) %
QCOM QUALCOMM, Inc. %
VOD Vodafone Group Plc (ADR) %
______ _________
Total Investments 100% $
====== =========
____________
<FN>
(1) All Equity Securities are represented by regular way contracts to
purchase such Equity Securities for the performance of which an
irrevocable letter of credit has been deposited with the Trustee. The
contracts to purchase Equity Securities were entered into by the Sponsor
on ______, 1998.
(2) The cost of the Equity Securities to the Trust represents the
aggregate underlying value with respect to the Equity Securities
acquired (generally determined by the last sale prices of the listed
Equity Securities and the ask prices of the over-the-counter traded
Equity Securities on the business day preceding the Initial Date of
Deposit). The valuation of the Equity Securities has been determined by
the Evaluator, an affiliate of the Sponsor. The aggregate underlying
value of the Equity Securities on the Initial Date of Deposit was $ .
Cost and loss to Sponsor relating to the Equity Securities sold to the
Trust were $ and $ , respectively.
(3) The portfolio may contain additional Equity Securities each of which
will not exceed approximately % of the Aggregate Offering Price.
Although it is not the Sponsor's intention, certain of the Equity
Securities listed above may not be included in the final portfolio.
Also, the percentages of the Aggregate Offering Price for the Equity
Securities are approximate amounts and may vary in the final portfolio.
</FN>
Page 52
Schedule of Investments
INTERNET GROWTH TRUST, SERIES 5
FT 291
At the Opening of Business on the
Initial Date of Deposit-____________, 1998
Approximate
Percentage Market Cost of
Number of Aggregate Value Equity
of Ticker Symbol and Offering per Securities
Shares Name of Issuer of Equity Securities (1) Price (3) Share to Trust (2)
______ _______________________________________ __________ ______ ____________
Access/Information Providers
____________________________
AOL America Online, Inc. % $ $
FDC First Data Corporation %
WCOM MCI WorldCom, Inc. %
UMG MediaOne Group, Inc. %
MSPG MindSpring Enterprises, Inc. %
QWST Qwest Communications International, Inc. %
Communications Equipment
________________________
LU Lucent Technologies, Inc. %
TLAB Tellabs, Inc. %
Computer Networking
___________________
COMS 3Com Corporation %
ASND Ascend Communications, Inc. %
CSCO Cisco Systems, Inc. %
Computer Services
________________
CATP Cambridge Technology Partners, Inc. %
Computers
_________
CPQ Compaq Computer Corporation %
DELL Dell Computer Corporation %
HWP Hewlett-Packard Company %
SUNW Sun Microsystems, Inc. %
Internet Content
________________
CMGI CMG Information Services, Inc. %
Retailing
________
EGRP E*TRADE Group, Inc. %
SCH Charles Schwab Corporation %
Semiconductors
______________
INTC Intel Corporation %
Software
________
CHKPF Check Point Software Technologies, Ltd. %
MSFT Microsoft Corporation %
NETA Network Associates, Inc. %
ORCL Oracle Corporation %
SE Sterling Commerce, Inc. %
______ _________
Total Investments 100% $
====== =========
____________________
<FN>
(1) All Equity Securities are represented by regular way contracts to
purchase such Equity Securities for the performance of which an
irrevocable letter of credit has been deposited with the Trustee. The
contracts to purchase Equity Securities were entered into by the Sponsor
on ______, 1998.
(2) The cost of the Equity Securities to the Trust represents the
aggregate underlying value with respect to the Equity Securities
acquired (generally determined by the last sale prices of the listed
Equity Securities and the ask prices of the over-the-counter traded
Equity Securities on the business day preceding the Initial Date of
Deposit). The valuation of the Equity Securities has been determined by
the Evaluator, an affiliate of the Sponsor. The aggregate underlying
value of the Equity Securities on the Initial Date of Deposit was $ .
Cost and loss to Sponsor relating to the Equity Securities sold to the
Trust were $ and $ , respectively.
(3) The portfolio may contain additional Equity Securities each of which
will not exceed approximately % of the Aggregate Offering Price.
Although it is not the Sponsor's intention, certain of the Equity
Securities listed above may not be included in the final portfolio.
Also, the percentages of the Aggregate Offering Price for the Equity
Securities are approximate amounts and may vary in the final portfolio.
</FN>
Page 53
Schedule of Investments
REGIONAL BANK & THRIFT GROWTH TRUST, SERIES 2
FT 291
At the Opening of Business on the
Initial Date of Deposit-____________, 1998
Approximate
Percentage Market Cost of
of Aggregate Value Equity
Number Ticker Symbol and Offering per Securities
of Shares Name of Issuer of Equity Securities (1) Price (3) Share to Trust (2)
_________ _______________________________________ ____________ ______ ____________
BANKS
_____
BKNG Banknorth Group, Inc. % $ $
CHZ Chittenden Corporation %
CNB Colonial BancGroup, Inc. %
CBSH Commerce Bancshares, Inc. %
CFBX Community First Bankshares, Inc. %
CBSS Compass Bancshares, Inc. %
CFR Cullen/Frost Bankers, Inc. %
FAM First American Corporation %
FBP FirstBank Puerto Rico %
FSCO First Security Corporation %
GBCB GBC Bancorp %
HUBC HUBCO, Inc. %
IRWN Irwin Financial Corporation %
MTB M&T Bank Corporation %
NFB North Fork Bancorporation, Inc. %
OFG Oriental Financial Group, Inc. %
PFGI Provident Financial Group, inc. %
SIVB Silicon Valley Bancshares %
SBIB Sterling Bancshares, Inc. %
TCB TCF Financial Corporation %
TRBS Texas Regional Bancshares, Inc. (Class A) %
WBST Webster Financial Corporation %
ZION Zions Corporation %
THRIFTS
_______
COFI Charter One Financial, Inc. %
CFB Commercial Federal Corporation %
FLGS Flagstar Bancorp, Inc. %
GPT GreenPoint Financial Corporation %
MAFB MAF Bancorp, Inc. %
PHBK People's Heritage Financial Group, Inc. %
SVRN Sovereign Bancorp, Inc. %
______ _________
Total Investments 100% $
====== =========
____________
<FN>
(1) All Equity Securities are represented by regular way contracts to
purchase such Equity Securities for the performance of which an
irrevocable letter of credit has been deposited with the Trustee. The
contracts to purchase Equity Securities were entered into by the Sponsor
on ______, 1998.
(2) The cost of the Equity Securities to the Trust represents the
aggregate underlying value with respect to the Equity Securities
acquired (generally determined by the last sale prices of the listed
Equity Securities and the ask prices of the over-the-counter traded
Equity Securities on the business day preceding the Initial Date of
Deposit). The valuation of the Equity Securities has been determined by
the Evaluator, an affiliate of the Sponsor. The aggregate underlying
value of the Equity Securities on the Initial Date of Deposit was $ .
Cost and loss to Sponsor relating to the Equity Securities sold to the
Trust were $ and $ , respectively.
(3) The portfolio may contain additional Equity Securities each of which
will not exceed approximately % of the Aggregate Offering Price.
Although it is not the Sponsor's intention, certain of the Equity
Securities listed above may not be included in the final portfolio.
Also, the percentages of the Aggregate Offering Price for the Equity
Securities are approximate amounts and may vary in the final portfolio.
</FN>
Page 54
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Page 55
CONTENTS:
Summary of Essential Information:
America's Leading Brands Growth Trust, Series 4 4
Auto & Transportation Growth Trust Series 4
Communications Growth Trust, Series 3 4
Internet Growth Trust, Series 5 5
Regional Bank & Thrift Growth Trust, Series 2 5
FT 291:
What is the FT Series? 8
What are the Expenses and Charges? 12
What is the Federal Tax Status of Unit Holders? 13
Are Investments in the Trusts Eligible for 16
Retirement Plans?
Portfolio:
What are the Equity Securities? 17
Risk Factors 17
What are the Equity Securities Selected for:
America's Leading Brands Growth Trust, Series 4? 23
Auto & Transportation Growth Trust Series? 25
Communications Growth Trust, Series 3? 27
Internet Growth Trust, Series 5? 29
Regional Bank & Thrift Growth Trust, Series 2? 31
What are Some Additional Considerations for
Investors? 33
Public Offering:
How is the Public Offering Price Determined? 34
How are Units Distributed? 36
What are the Sponsor's Profits? 38
Will There be a Secondary Market? 38
Rights of Unit Holders:
How is Evidence of Ownership Issued and Transferred? 39
How are Income and Capital Distributed? 39
What Reports will Unit Holders Receive? 40
How May Units be Redeemed? 41
How May Units be Purchased by the Sponsor? 42
How May Equity Securities be Removed from a Trust? 43
Information as to Sponsor, Trustee and Evaluator:
Who is the Sponsor? 43
Who is the Trustee? 44
Limitations on Liabilities of Sponsor and Trustee 44
Who is the Evaluator? 44
Other Information:
How May the Indenture be Amended or Terminated? 45
Legal Opinions 46
Experts 46
Report of Independent Auditors 47
Statements of Net Assets:
America's Leading Brands Growth Trust, Series 4 48
Auto & Transportation Growth Trust Series 48
Communications Growth Trust, Series 3 48
Internet Growth Trust, Series 5 49
Regional Bank & Thrift Growth Trust, Series 2 49
Schedules of Investments:
America's Leading Brands Growth Trust, Series 4 50
Auto & Transportation Growth Trust Series 51
Communications Growth Trust, Series 3 52
Internet Growth Trust, Series 5 53
Regional Bank & Thrift Growth Trust, Series 2 54
_____________
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 TRUST (registered trademark)
AMERICA'S LEADING BRANDS GROWTH TRUST SERIES 4
AUTO & TRANSPORTATION GROWTH TRUST SERIES
COMMUNICATIONS GROWTH TRUST, SERIES 3
INTERNET GROWTH TRUST SERIES 5
REGIONAL BANK & THRIFT GROWTH TRUST, SERIES 2
Nike Securities L.P.
1001 Warrenville Road, Suite 300
Lisle, Illinois 60532
1-630-241-4141
Trustee:
The Chase Manhattan Bank
4 New York Plaza, 6th floor
New York, New York 10004-2413
1-800-682-7520
24-Hour Pricing Line:
1-800-446-0132
____________, 1998
PLEASE RETAIN THIS PROSPECTUS
FOR FUTURE REFERENCE
Page 56
MEMORANDUM
Re: FT 291
As indicated in our cover letter transmitting the
Registration Statement on Form S-6 and other related material
under the Securities Act of 1933 to the Commission, the only
difference of consequence (except as described below) between FT
259, which is the current fund, and FT 291, the filing of which
this memorandum accompanies, is the change in the series number.
The list of securities comprising the Fund, the evaluation,
record and distribution dates and other changes pertaining
specifically to the new series, such as size and number of Units
in the Fund and the statement of condition of the new Fund, will
be filed by amendment.
1940 ACT
FORMS N-8A AND N-8B-2
These forms were not filed, as the Form N-8A and Form N-8B-2
filed in respect of Templeton Growth and Treasury Trust, Series 1
and subsequent series (File No. 811-05903) related also to the
subsequent series of the Fund.
1933 ACT
PROSPECTUS
The only significant changes in the Prospectus from the
Series 259 Prospectus relate to the series number and size and
the date and various items of information which will be derived
from and apply specifically to the bonds deposited in the Fund.
CONTENTS OF REGISTRATION STATEMENT
ITEM A Bonding Arrangements of Depositor:
Nike Securities L.P. is covered by a Broker's Fidelity
Bond, in the total amount of $1,000,000, the insurer
being National Union Fire Insurance Company of
Pittsburgh.
ITEM B This Registration Statement on Form S-6 comprises the
following papers and documents:
The facing sheet
The Cross-Reference Sheet
The Prospectus
The signatures
Exhibits
Financial Data Schedule
S-1
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant, FT 291 has duly caused this Amendment No. 1 to
the Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the Village of Lisle
and State of Illinois on October 6, 1998.
FT 291
(Registrant)
By: NIKE SECURITIES L.P.
(Depositor)
By Robert M. Porcellino
Senior Vice President
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed below by the
following person in the capacity and on the date indicated:
NAME TITLE* DATE
Robert D. Van Kampen Director of
Nike Securities October 6, 1998
Corporation, the
General Partner of
Nike Securities L.P. Robert M. Porcellino
Attorney-in-Fact**
David J. Allen Director of
Nike Securiites
Corporation, the
General Partner of
Nike Securities L.P.
___________________________
* The title of the person named herein represents his capacity
in and relationship to Nike Securities L.P., the Depositor.
** An executed copy of the related power of attorney was filed
with the Securities and Exchange Commission in connection
with Amendment No. 1 to form S-6 of The First Trust Combined
Series 258 (File No. 33-63483) and the same is hereby
incorporated by this reference.
S-2
CONSENTS OF COUNSEL
The consents of counsel to the use of their names in the
Prospectus included in this Registration Statement will be
contained in their respective opinions to be filed as Exhibits
3.1, 3.2, 3.3 and 3.4 of the Registration Statement.
CONSENT OF ERNST & YOUNG LLP
The consent of Ernst & Young LLP to the use of its name and
to the reference to such firm in the Prospectus included in this
Registration Statement will be filed by amendment.
CONSENT OF FIRST TRUST ADVISORS L.P.
The consent of First Trust Advisors L.P. to the use of its
name in the Prospectus included in the Registration Statement is
filed as Exhibit 4.1 to the Registration Statement.
S-3
EXHIBIT INDEX
1.1 Form of Standard Terms and Conditions of Trust for The
First Trust Special Situations Trust, Series 24 and
certain subsequent Series, effective January 23, 1992
among Nike Securities L.P., as Depositor, United States
Trust Company of New York as Trustee, Securities
Evaluation Service, Inc., as Evaluator, and Nike
Financial Advisory Services L.P. as Portfolio Supervisor
(incorporated by reference to Amendment No. 1 to Form S-6
[File No. 33-45093] filed on behalf of The First Trust
Special Situations Trust, Series 24).
1.1.1* Form of Trust Agreement for Series 312 among Nike
Securities L.P., as Depositor, The Chase Manhattan Bank,
as Trustee and First Trust Advisors L.P., as Evaluator
and Portfolio Supervisor.
1.2 Copy of Certificate of Limited Partnership of Nike
Securities L.P. (incorporated by reference to Amendment
No. 1 to Form S-6 [File No. 33-42683] filed on behalf of
The First Trust Special Situations Trust, Series 18).
1.3 Copy of Amended and Restated Limited Partnership
Agreement of Nike Securities L.P. (incorporated by
reference to Amendment No. 1 to Form S-6 [File No.
33-42683] filed on behalf of The First Trust Special
Situations Trust, Series 18).
1.4 Copy of Articles of Incorporation of Nike Securities
Corporation, the general partner of Nike Securities L.P.,
Depositor (incorporated by reference to Amendment No. 1
to Form S-6 [File No. 33-42683] filed on behalf of The
First Trust Special Situations Trust, Series 18).
1.5 Copy of By-Laws of Nike Securities Corporation, the
general partner of Nike Securities L.P., Depositor
(incorporated by reference to Amendment No. 1 to Form S-6
[File No. 33-42683] filed on behalf of The First Trust
Special Situations Trust, Series 18).
2.1 Copy of Certificate of Ownership (included in Exhibit 1.1
filed herewith on page 2 and incorporated herein by
reference).
3.1* Opinion of counsel as to legality of Securities being
registered.
3.2* Opinion of counsel as to Federal income tax status of
Securities being registered.
S-4
3.3* Opinion of counsel as to New York income tax status of
Securities being registered.
3.4* Opinion of counsel as to advancement of funds by Trustee.
4.1* Consent of First Trust Advisors, L.P.
6.1 List of Directors and Officers of Depositor and other
related information (incorporated by reference to
Amendment No. 1 to Form S-6 [File No. 33-42683] filed on
behalf of The First Trust Special Situations Trust,
Series 18).
7.1 Power of Attorney executed by the Director listed on page
S-3 of this Registration Statement (incorporated by
reference to Amendment No. 1 to Form S-6 [File No.
33-63483] filed on behalf of The First Trust Combined
Series 258).
___________________________________
* To be filed by amendment.
S-5