AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 23, 2020
1933 ACT FILE NO. 333-
1940 ACT FILE NO. 811 - 03763
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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REGISTRATION STATEMENT ON
FORM S-6
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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: GUGGENHEIM DEFINED PORTFOLIOS, SERIES 2017
B. NAME OF DEPOSITOR: GUGGENHEIM FUNDS DISTRIBUTORS, LLC
C. COMPLETE ADDRESS OF DEPOSITOR'S PRINCIPAL EXECUTIVE OFFICES:
Guggenheim Funds Distributors, LLC
227 West Monroe Street
Chicago, Illinois 60606
D. NAME AND COMPLETE ADDRESS OF AGENT FOR SERVICE:
Copies to:
AMY LEE, ESQ. ERIC F. FESS, ESQ.
Vice President and Secretary Chapman and Cutler LLP
Guggenheim Funds Distributors, LLC 111 West Monroe Street
227 West Monroe Street Chicago, Illinois 60603
Chicago, Illinois 60606 (312) 845-3000
(630) 505-3700
It is proposed that this filing will become effective (check appropriate box)
[_] immediately upon filing pursuant to paragraph (b)
[_] on (date) pursuant to paragraph (b)
[_] 60 days after filing pursuant to paragraph (a)(1)
[_] on (date) pursuant to paragraph (a)(1) of rule 485
[_] This post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
E. TITLE OF SECURITIES BEING REGISTERED: Units of fractional undivided
beneficial interest.
F. APPROXIMATE DATE OF PROPOSED SALE TO PUBLIC: As soon as practicable after
the effective date of the Registration Statement.
[_] Check box if it is proposed that this filing will become effective on
(date) at (time) pursuant to Rule 487.
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The registration hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a)
may determine.
The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an
offer to sell these securities and is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
Preliminary Prospectus Dated March 23, 2020, Subject to Completion
Guggenheim Defined Portfolios, Series 2017
Defined Outcome Trust: Large Cap
Buffer 10 Portfolio, July 2021
GUGGENHEIM LOGO
PROSPECTUS PART A DATED ___________, 2020
The ability of the trust to provide the capped return or limited downside
protected loss set forth in this prospectus is dependent on unitholders
purchasing units at the trust's inception and holding the units until the trust
is terminated. Units are expected to be sold only on the trust's inception
date. If you redeem units prior to the trust's mandatory termination date, you
will not get the same exposure to the trust's investment objective.
Additionally, investors that purchase units at a price that is above the unit
price at inception will have a potential maximum return that is less than the
targeted maximum return per unit and may be subject to a potential loss that is
greater than the targeted maximum loss per unit.
The Securities and Exchange Commission has not approved or
disapproved of these securities or passed upon the adequacy or accuracy of this
prospectus. Any representation to the contrary is a criminal offense.
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INVESTMENT SUMMARY
Use this Investment Summary to help you decide whether an investment in
this trust is right for you. More detailed information can be found later in
this prospectus.
Overview
Guggenheim Defined Portfolios, Series 2017 is a unit investment trust that
consists of the Defined Outcome Trust: Large Cap Buffer 10 Portfolio, July 2021
(the "trust"). Guggenheim Funds Distributors, LLC ("Guggenheim Funds" or the
"sponsor") serves as the sponsor of the trust.
The trust is scheduled to terminate in approximately 15 months.
Investment Objective
The trust seeks to provide target returns based on the price performance
of shares of the SPDR[R] S&P 500[R] ETF Trust (the "Reference Asset") with a
buffer, subject to capped upside return. There is no assurance that the trust
will achieve its investment objective.
Principal Investment Strategy
The trust's strategy has been specifically designed to produce outcomes
based upon the Reference Asset's performance over the duration of the outcome
period. The outcomes may only be realized if you hold units on the first day of
the offering period and continue to hold them on the last day of the trust's
existence (the "Mandatory Termination Date"), which will be on or about ______,
2021. Excluding any estimated trust fees and expenses (including sales fees),
the range of intended possible returns is capped at a maximum return of _____%
of the Reference Asset's Initial RA Value (defined below), and the potential
losses are buffered so that the first 10% of losses are not realized. As a
result, excluding fees and expenses, the trust is designed so that losses are
limited to a maximum loss of 90% of the Initial RA Value. The maximum return and
loss of the Reference Asset are based on the performance at the Option
Expiration Date and are not an annualized rate of return. The annualized maximum
return is ___% and ___% for a Fee Account and Standard Account (as defined under
"Understanding Your Investment--How to Buy Units--Advisory and Fee Accounts"),
respectively, after estimated trust fees and expenses. There is no assurance the
trust will achieve its objective and investment in units of the trust has the
potential for the loss of some or all of your original investment. Unitholders
who redeem units prior to the trust's Mandatory Termination Date may realize a
loss on their investment even when the price of the Reference Asset is higher
than the Initial RA Value.
The trust seeks to achieve its objective by utilizing an investment
strategy that involves (i) purchasing and writing "put" and "call" Flexible
Exchange[R] Options entitling the trust to purchase or sell shares of the
Reference Asset ("FLEX Options") scheduled to expire on ________, 2021 (the
"Option Expiration Date"); and (ii) holding cash to pay for fees and expenses
of the trust. Under normal circumstances, the trust will invest at least 80% of
the value of its assets in the economic equivalent of large-capitalization
securities, as represented by FLEX Options that entitle the trust to purchase
or sell shares of the Reference Asset. On the trust's inception date, the trust
will deposit the exchange-traded FLEX Options and cash in the the amounts set
forth in the "Trust Portfolio." The FLEX Options are European-style options,
which means that they will be exercisable at the strike price only on the
Option Expiration Date.
The trust seeks to provide unitholders that hold their units over the
entire outcome period with a return that is based upon the return of the
Reference Asset minus estimated trust fees and expenses, which include all
sales fees. The return is based on the price performance of the Reference Asset
as of an intraday price on the trust's inception date (the "Initial RA Value")
through the Option Expiration Date. The trust is designed to provide a
percentage return per unit based upon the percentage increase or decrease in
the price of the Reference Asset relative to the Initial RA Value subject to
applicable caps and buffers.
The potential returns received by unitholders that purchase their units on
the inception date and hold them until the Mandatory Termination Date will be
reduced by the estimated fees and expenses of the trust, which include the
applicable sales fees. For Fee Account and Standard Account Unitholders, those
fees and expenses (including sales fees and excluding transaction costs and
extraordinary expenses) are estimated to be _____% and _____%, respectively,
for the life of the trust. As a result, a unitholder's returns and applicable
caps and buffers will be impacted, whether the unitholder purchases units
through a Fee Account or Standard Account. Accordingly, for units purchased on
the inception date, estimated returns of the trust (after estimated fees and
expenses and excluding transaction costs and extraordinary expense) are capped
at _____% and _____%, respectively, for Fee Account and Standard Account
unitholders. These potential returns are equal to _____% and _____% annualized
returns for Fee Accounts and Standard Accounts.
In addition, for both Fee Accounts and Standard Accounts, if the Reference
Asset's return over the outcome period is negative, the trust is designed so
that the potential losses are buffered whereby the first 10% of losses are not
realized by the trust. As a result, the trust is designed so that: (i) if the
return of the Reference Asset is between 0 and -10% over the outcome period,
unitholders will receive a percentage return of 0% minus the fees and expenses
of the trust (including sales fees); or (ii) if the return of the Reference
Asset is between -10% and -100% over the outcome period, unitholders will
receive a percentage loss equal to the loss of the Reference Asset over the
outcome period, adjusted by the 10% buffer, and minus the fees and expenses of
the trust (including sales fees).
Please note that if a unitholder redeems their units before the Mandatory
Termination Date, that unitholder may not receive these targeted returns and
may lose money even if the performance of the Reference Asset has increased.
Additionally, please note that unitholders that purchase units at prices above
the unit price at inception will have a maximum return that is less than the
capped return over the life of the trust and less than the maximum annualized
return.
Market Scenario Illustrations
The trust seeks to provide payouts net of all estimated trust fees and
expenses (including sales fees and excluding transaction costs and
extraordinary expenses) based on the price performance of the Reference Asset
for units purchased at the trust's inception date and held until the Mandatory
Termination Date as follows:
o If at the close of the New York Stock Exchange on the Option
Expiration Date the price of the Reference Asset (the "RA Price") is
greater than or equal to $_____ (_____% of the Initial RA Value) (the
"Cap"), the proceeds from the FLEX Options are intended to be
approximately $_____ per unit. This equates to a Fee Account return of
approximately _____% or a Standard Account return of approximately
_____%, which represents a maximum capped return.
o If at the close of the New York Stock Exchange on the Option
Expiration Date the RA Price is between $_____ and $_____ (100% to
_____% of the Initial RA Value), the proceeds from the FLEX Options
are intended to be between approximately $10 and $_____ per unit. This
equates to a Fee Account return of approximately _____% to _____% or a
Standard Account return of approximately _____% to _____%.
o If at the close of the New York Stock Exchange on the Option
Expiration Date the RA Price is between $_____ and $_____ (90% to 100%
of the Initial RA Value), the proceeds from the FLEX Options are
intended to be approximately $10 per unit. This equates to a Fee
Account return of approximately _____% or a Standard Account return of
approximately _____%.
o If at the close of the New York Stock Exchange on the Option
Expiration Date the RA Price is less than $_____ (90% of the Initial
RA Value) the proceeds from the FLEX Options are intended to be
between approximately $1 and $10 per unit. This equates to a Fee
Account return of approximately _____% to _____% or a Standard Account
return of approximately _____% to _____%.
The trust may outperform the Reference Asset (minus the fees and expenses
of the trust) if the Reference Asset's price has decreased by between 0% and
-100% as of the Option Expiration Date. Alternatively, because of the Cap and
applicable fees and expenses of the trust, the trust will underperform the
Reference Asset if the Reference Asset's price has increased as of the Option
Expiration Date.
The potential returns provided above are based on a range of assumptions,
including estimated expenses. Any returns will be negatively affected by any
portfolio transaction fees and extraordinary expenses incurred by the trust.
The graph below is a hypothetical illustration of the mathematical
principles underlying the FLEX Options and the operation of the trust's
investment strategy. This illustration does NOT take into account the fees and
expenses of the trust and accordingly trust returns will be lower than the
estimated returns provided. There is no assurance that the trust will achieve
its investment objective through the use of this strategy. You may realize a
payout (including a potential loss) that is higher or lower than the intended
returns as a result of: (1) redeeming units prior to the trust's mandatory
termination date, (2) various circumstances (as described below) where FLEX
Options are otherwise liquidated by the trust prior to their expiration or
maturity, (3) if the trust is unable to maintain the proportional relationship
(as described below) of the FLEX Options based on the number of FLEX Option
contracts in the trust's portfolio, (4) if the cost of satisfying redemption
requests exceeds the proceeds received by the trust for selling FLEX Options to
satisfy redemptions, (5) fees and expenses of the trust and those associated
with owning the trust, and (6) taxes required to be paid by the trust or
unitholders. The FLEX Options are intended to be liquidated on the Option
Expiration Date, rather than be exercised, in order to avoid having the trust
receive shares of the Reference Asset or be obligated to deliver shares of the
Reference Asset. As a result, the return actually realized on the FLEX Options
upon liquidation could vary from the returns that would be realized if the FLEX
Options were exercised based on the price of shares of the Reference Asset as of
the close of the market on the Option Expiration Date.
[GRAPH TO BE PROVIDED]
The "proportional relationship" of the FLEX Options referred to throughout
the prospectus that the trust seeks to maintain refers to the proportion of the
particular types of FLEX Options as of the trust's inception. For example, if
the trust's portfolio included 10 purchased call options (with a particular
strike and expiration) for every 2 written put options (with a particular
strike and expiration) at inception, the trust would seek to maintain that 10
contracts to 2 contracts proportional relationship. See "Investment Summary --
Trust Portfolio" for the actual number of FLEX Option contracts at inception.
Under certain limited circumstances provided in the trust agreement, FLEX
Options may be liquidated by the trust prior to the Option Expiration Date.
These circumstances may include paying expenses, satisfying unit redemptions by
unitholders, protecting the trust in limited circumstances, making required
distributions or avoiding the imposition of taxes on the trust as described
under "Understanding Your Investment -- How the Trust Works --Changing Your
Portfolio."
In addition, the trust may not be able to achieve the anticipated returns
set forth in this prospectus. The trust's performance may be impacted by a
variety of factors, including but not limited to redemption activity, unusual
economic events, market movements and changes in the liquidity of the FLEX
Options. The trust's portfolio is not managed. In the unlikely event that the
FLEX Options cannot maintain their proper ratios, there may be significant
impact to the trust's ability to meet its investment objective or follow its
principal investment strategy.
The sponsor has partnered with Milliman Financial Risk Management LLC
("Milliman") as portfolio consultant. Milliman will suggest securities for the
portfolio that it believes possess the potential to achieve the trust's
investment objective.
Assets Held by the Trust
The FLEX Options. The trust's portfolio holds FLEX Options referred to as
the "Purchased Call Options," "Purchased Put Options," "Written Call Options"
and "Written Put Options". The Purchased Put Options and Purchased Call Options
together constitute the "Purchased Options." The Written Call Options and
Written Put Options constitute the "Written Options."
FLEX Options provide investors with the ability to customize assets and
indices referenced by the options, exercise prices, exercise styles and
expiration dates, while achieving price discovery in competitive, transparent
auctions markets and avoiding the counterparty exposure of over-the-counter
option positions. The FLEX Options are European-style options, which means that
they will be exercisable at the strike price only on the Option Expiration
Date. FLEX Options are standard listed option contracts available through
national securities exchanges that are guaranteed for settlement by the Options
Clearing Corporation (the "OCC"), a market clearinghouse. The FLEX Options are
listed on the Chicago Board Options Exchange (the "CBOE"). The trust is
designed so that any amount owed by the trust on the Written Options will be
covered by payouts at expiration from the Purchased Options. The trust receives
premiums in exchange for the Written Options and pays premiums in exchange for
the Purchased Options. The OCC and CBOE do not charge ongoing fees to writers
or purchasers of the FLEX Options during their life for continuing to hold the
option contracts. As a result, the Written Options will be fully covered and no
additional collateral will be necessary during the life of the trust.
The OCC guarantees performance by each of the counterparties to the FLEX
Options, becoming the "buyer for every seller and the seller for every buyer,"
thereby protecting clearing members and options traders from counterparty risk.
Subject to determination by the Securities Committee of the OCC, adjustments
may be made to the FLEX Options for certain events (collectively, "Corporate
Actions") specified in the OCC's bylaws and rules such as: certain stock
dividends or distributions, stock splits, reverse stock splits, rights
offerings, distributions, reorganizations, recapitalizations, or
reclassifications with respect to an underlying security, or a merger,
consolidation, dissolution or liquidation of the issuer of the underlying
security. According to the OCC's by-laws, the nature and extent of any such
adjustment is to be determined by the OCC's Securities Committee, in light of
the circumstances known to it at the time such determination is made, based on
its judgment as to what is appropriate for the protection of investors and the
public interest, taking into account such factors as fairness to holders and
writers (or purchasers and sellers) of the affected options, the maintenance of
a fair and orderly market in the affected options, consistency of
interpretation and practice, efficiency of exercise settlement procedures, and
the coordination with other clearing agencies of the clearance and settlement
of transactions in the underlying interest.
The description and terms of the FLEX Options to be entered into with the
OCC are set forth in the by-laws and rules of the OCC. Please see
www.optionsclearing.com for more information. The OCC's website is not
considered part of this prospectus, nor is it incorporated by reference herein.
Call Options. A European-style call option is a contract that gives the
owner the right but not the obligation to buy the underlying security at a
specified price (its strike price) on the option expiration date. For the writer
of a call option, the contract represents an obligation to sell the underlying
security from the option owner if the option is exercised. A call option is
likely to be exercised if it is in-the-money, i.e., the current market value of
the underlying security is above the strike price. Conversely, it is likely to
expire worthless if the call option is out-of-the-money, i.e., the current
market value of the underlying security is below the strike price.
Put Options. A European-style put option is a contract that gives the
owner the right but not the obligation to sell the underlying security at a
specified price (its strike price) on the option expiration date. For the
writer of a put option, the contract represents an obligation to buy the
underlying security from the option owner if the option is exercised. A put
option is likely to be exercised if it is in-the-money, i.e., the current
market value of the underlying security is below the strike price. Conversely,
it is likely to expire worthless if the put option is out-of-the-money, i.e.,
the current market value of the underlying security is above the strike price.
See "Hypothetical Option Expiration Examples" in the appendix of the
prospectus for additional information.
The Reference Asset and The Index
The Reference Asset is an exchange-traded fund that trades on the NYSE
Arca, Inc. stock exchange under the ticker symbol "SPY." The Reference Asset
seeks to track the investment results of the S&P 500[R] Index (the "Index"),
which measures the performance of large-capitalization U.S. equity securities.
The components of the Index, and the degree to which these components represent
certain industries, may change over time. The Index is reconstituted on an
as-needed basis. The Reference Asset seeks to achieve its investment objective
by holding a portfolio of the common stocks that are included in the Index, with
the weight of each stock in its portfolio substantially corresponding to the
weight of such stock in the Index. Although the Reference Asset may fail to own
certain securities of the Index at any particular time, the Reference Asset
generally will be substantially invested in securities of the Index, which
should result in a close correspondence between the performance of the Index and
the performance of the Reference Asset.
The Reference Asset seeks to track the investment results of the Index
before fees and expenses of the Reference Asset. The sponsor has derived all
information regarding the Reference Asset contained in this prospectus from the
registration statement for the Reference Asset. Such information reflects the
policies of, and is subject to change by, the Reference Asset's sponsor, PDR
Services, LLC. Information concerning the Reference Asset filed with the SEC
can be located by reference to SEC file number 811-06125 and 33-46080. The
sponsor has not undertaken any independent review or due diligence of the SEC
filings by the issuer of the Reference Asset or any other publicly available
information regarding such issuer. Information from outside sources is not
incorporated by reference in, and should not be considered part of, this
prospectus.
The summary information is not designed to be, and should not be
interpreted as, an effort to present information regarding the financial
prospects of any issuer or any trends, events or other factors that may have a
positive or negative influence on those prospects or as an endorsement of any
particular issuer or exchange-traded fund. The trust is not sponsored, endorsed,
sold or promoted by SPDR[R] S&P 500[R] ETF Trust, PDR Services, LLC or S&P Dow
Jones Indices LLC. SPDR[R] S&P 500[R] ETF Trust, PDR Services, LLC and S&P Dow
Jones Indices LLC have not passed on the legality or suitability of, or the
accuracy or adequacy of, descriptions and disclosures relating to the trust or
the FLEX Options. SPDR[R] S&P 500[R] ETF Trust, PDR Services, LLC and S&P Dow
Jones Indices LLC make no representations or warranties, express or implied,
regarding the advisability of investing in the trust or the FLEX Options or
results to be obtained by the trust or the FLEX Options, unitholders or any
other person or entity from use of the Reference Asset. SPDR[R] S&P 500[R] ETF
Trust, PDR Services, LLC and S&P Dow Jones Indices LLC have no liability in
connection with the management, administration, marketing or trading of the
trust or the FLEX Options.
Milliman Financial Risk Management LLC
Milliman Financial Risk Management LLC is a provider of financial risk
management to the retirement savings industry. Milliman provides investment
advisory, hedging and consulting services for over $155.5 billion in global
assets (as of December 31, 2019).
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Essential Information
Unit price at inception for
Standard Accounts: $________
Unit price at inception for
Fee Accounts $________
Inception date: ________
Mandatory Termination Date: _______,____
Evaluation time: As of the close of trading of the
New York Stock Exchange
(normally 4 p.m. Eastern time);
however, on the first day units
are sold, the evaluation time will
be as of the close of trading of the
New York Stock Exchange
or the time the registration
statement filed with the Securities
and Exchange Commission
becomes effective, if later
Redemption Cutoff: One hour prior to the close of
the New York Stock Exchange
(normally 4 p.m. Eastern time).
Distribution date: 25th day of each month
(commencing on
_____ 25, 2020, if any)
Record date: 15th day of each month
(commencing on
_____ 15, 2020, if any)
CUSIP Numbers:
Cash Distributions
Standard Accounts:
Fee Accounts:
Ticker:
Minimum investment: 1 unit
Summary of Defined Terms
Option Expiration Date: _______, 2021
Reference Asset: SPDR[R] S&P 500[R]
ETF Trust
Index: S&P 500[R] Index
Initial RA Value: $____ (an amount equal
to a price of a share
of the Reference Asset
on the inception date)
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Principal Risks
As with all investments, you may lose some or all of your investment in
the trust. No assurance can be given that the trust's investment objective will
be achieved. The trust also might not perform as well as you expect. This can
happen for reasons such as these:
o Passive investment risk. The value of your investment may fall over
time. The trust will generally hold, and may continue to buy, the same
securities even though a security's outlook, rating, market value or
yield may have changed.
o Market risk. Market risk is the risk that a particular security in the
trust, the trust itself or securities in general may fall in value.
Market value may be affected by a variety of factors, including
general securities markets movements, changes in the financial
condition of an issuer or a sector, changes in perceptions about an
issuer or a sector, interest rates and inflation and governmental
policies and litigation. Although the sponsor, who serves as the
evaluator of the trust (the "evaluator"), carefully supervises your
trust, you should remember that it does not manage your trust. Your
trust will not sell a security solely because the market value falls,
as is possible in a managed fund.
o Investment risk. You may lose a significant portion of your
investment. The trust does not provide principal protection and you
may not receive a return of the capital you invest. In addition, the
units will not realize more than the capped return from the FLEX
Options, even if the return on the Reference Asset far exceeds that
level.
o Capped upside and limited downside protection risk. The trust's return
is subject to an upside cap, and loss is subject to a buffer. The
trust's ability to provide capped upside and a buffered downside is
dependent on unitholders purchasing units at the trust's inception and
holding them until the trust is terminated. You may realize a return
or loss that is higher or lower than the intended returns or losses as
a result of redeeming units prior to the Mandatory Termination Date,
where FLEX Options are otherwise liquidated by the trust prior to
expiration, if a Corporate Action occurs with respect to the Reference
Asset, or if there are increases in potential tax-related expenses and
other expenses of the trust above estimated levels.
o Underlying Reference Asset performance and equity risk. The trust is
subject to performance and equity risk related to the Reference Asset,
the Index and securities comprising the Index. The formulas used to
calculate the FLEX Options' payments at expiration are based on the
price performance of the Reference Asset. The FLEX Options represent
indirect positions in the Reference Asset and are subject to changes
in value as the price of the Reference Asset rises or falls. The value
of the FLEX Options may be adversely affected by various factors
affecting the Reference Asset, the Index and the value of the
securities comprising the Index. The settlement value of the FLEX
Options is based on the Closing Value on the Option Expiration Date
only and will be substantially determined by market conditions as of
such time. The FLEX Options are intended to be liquidated as of the
close of market on the Option Expiration Date rather than be exercised
according to the FLEX Options' terms in order to avoid having the
trust receive shares of the Reference Asset or be obligated to deliver
shares of the Reference Asset. The value of the Reference Asset will
fluctuate over time based on fluctuations in the value of the stocks
held by the Reference Asset, which may be impacted by changes in
general economic conditions, expectations for future economic growth,
and corporate profits and interest rates. Although common stocks have
historically generated higher average returns than fixed-income
securities over the long term, common stocks also have experienced
significantly more volatile returns. Common stocks are structurally
subordinated to preferred stocks, bonds and other debt instruments in
a company's capital structure and represent a residual claim on the
issuer's assets that have no value unless such assets are sufficient
to cover all other claims.
The value of the trust does not appreciate due to dividend payments
paid by the Reference Asset, because the trust does not own the
Reference Asset. The trust seeks to provide target returns on the
price performance of the Reference Asset, which does not include
returns from dividends paid by the Reference Asset. Unitholders will
not have control, voting rights or rights to receive cash dividends or
other distributions or other rights that holders of a direct
investment in the Reference Asset would have.
o Options risk. The value of the FLEX Options may change with the
implied volatility of the Reference Asset, the Index and the
securities comprising the Index. No one can predict whether implied
volatility will rise or fall in the future. It is not anticipated that
there will be an existing market for options with the same customized
terms as the FLEX Options, and an active market may not be
established. Prior to the trust's inception date, there has been no
existing trading market for the FLEX Options.
The values of the FLEX Options do not increase or decrease at the same
rate as the Reference Asset or the Index. Prior to the Option
Expiration Date, the value of the FLEX Options is determined based
upon market quotations, the last asked or bid price in the
over-the-counter market or using other recognized pricing methods. The
value of the FLEX Options prior to the Option Expiration Date may vary
because of related factors other than the price of shares of the
Reference Asset. Factors that may influence the value of the FLEX
Options are interest rate changes, implied volatility levels of the
Reference Asset, Index and securities comprising the Index and implied
dividend levels of the Reference Asset, Index and securities
comprising the Index, among others.
Written Options risk. The Written Options may reduce the value of your
units. The Written Options create an obligation to make a payment in
contrast to the Purchased Options, which creates the potential for
receipt of a payment. As the value of the Written Options increases,
it has a negative impact on the value of your units.
Credit risk. Credit risk is the risk an issuer, guarantor or
counterparty of a security in the trust is unable or unwilling to meet
its obligation on the security. The OCC acts as guarantor and central
counterparty with respect to the FLEX Options. As a result, the
ability of the trust to meet its objective depends on the OCC being
able to meet its obligations.
Liquidity risk. Liquidity risk is the risk that the value of a FLEX
Option will fall in value if trading in the FLEX Option is limited or
absent. No one can guarantee that a liquid secondary trading market
will exist for the FLEX Options. Trading in the FLEX Options may be
less deep and liquid than certain other securities. FLEX Options may
be less liquid than certain non-customized options. The sponsor
expects that the trust will hold 10% or less of its net asset value in
illiquid securities. In a less liquid market for the FLEX Options,
liquidating the FLEX Options upon a redemption of units may require
the payment of a premium or acceptance of a discounted price and may
take longer to complete. In a less liquid market for the FLEX Options,
the liquidation of a large number of FLEX Options may more
significantly impact the price. A less liquid trading market may
adversely impact the value of the FLEX Options and your units.
Valuation risk. Under certain circumstances, current market prices may
not be available with respect to the FLEX Options. Under those
circumstances, the value of the FLEX Options will require more
reliance on the judgment of the evaluator than that required for
securities for which there is an active trading market. This creates a
risk of mispricing or improper valuation of the FLEX Options, which
could impact the value received or paid for units.
Proportional relationship risk. In the unlikely event the trust is
unable to maintain the proportional relationship of the FLEX Options,
it will be unable to achieve its objective.
o Exchange-traded fund risk. Certain features of the Reference Asset,
which is an exchange-traded fund, will impact the value of the units.
The value of the Reference Asset is subject to the following factors:
Passive investment risk. The Reference Asset is not actively managed
and attempts to track the performance of an unmanaged index of
securities. This differs from an actively managed fund, which
typically seeks to outperform a benchmark index. As a result, the
Reference Asset will hold constituent securities of the Index
regardless of the current or projected performance on a specific
security or particular industry or market sector. Maintaining
investments in the securities regardless of market conditions of the
performance of individual securities could impact the unit price of
the Reference Asset, the FLEX Options and the trust units.
Tracking error. Exchange-traded funds face index correlation risk,
which is the risk that the performance of an exchange-traded fund will
vary from the actual performance of the target index, known as
"tracking error." The performance of the Reference Asset may not
replicate the performance of, and may underperform, the Index. It is
possible that the Reference Asset may not fully replicate or may, in
certain circumstances, diverge significantly from the performance of
the Index due to the Reference Asset not investing in all stocks
comprising the Index, temporary unavailability of certain securities
in the secondary market, differences in trading hours between the
Reference Asset and securities comprising the Index, the occurrence of
corporate actions (mergers and spinoffs), or other circumstances.
Because the return or loss on the FLEX Options references the price
performance of the Reference Asset and not the Index, the return or
loss on the FLEX Options and your units may be less than that of an
alternative investment linked directly to the Index.
Fees and expenses. Unlike the Index, the Reference Asset will reflect
transaction costs and fees that will reduce its price performance
relative to the Index.
Discount. Shares of exchange-traded funds tend to trade at a discount
from their net asset value.
o Dilution risk. You could experience a dilution of your investment as a
result of redemption activity or expenses of the trust. There is no
assurance that your investment will maintain its proportionate share
in the trust's profits and losses, or that your investment will be in
the same portfolio for the duration of the trust.
o Cybersecurity risk. The trust may be susceptible to potential risks
through breaches in cybersecurity. A breach in cybersecurity refers to
both intentional and unintentional events that may cause the trust to
lose proprietary information, suffer data corruption or lose
operational capacity. Such events could cause the sponsor of the trust
to incur regulatory penalties, reputational damage, additional
compliance costs associated with corrective measures and/or financial
loss. In addition, cybersecurity breaches of the trust's third-party
service providers, or issuers in which the trust invests, can also
subject the trust to many of the same risks associated with direct
cybersecurity breaches.
o Early termination risk. The trustee has the power to terminate your
trust early in limited cases as described under "Understanding Your
Investment--How Your Trust Works--Termination of Your Trust,"
including if the value of the trust is less than $1 million or less
than 40% of the value of the securities in the trust at the end of the
initial offering period. If the trust terminates early, the trust may
suffer losses and be unable to achieve its investment objective. This
could result in a reduction in the value of units and result in a
significant loss to investors.
o Legislation and litigation risk. From time to time, various
legislative initiatives or regulatory standards are proposed in the
United States and abroad which may have a negative impact on the
Reference Asset, the Index or the securities comprising the Index. In
addition, litigation regarding any of the issuers of the securities,
or of the industries represented by such issuers, may negatively
impact the value of these securities. We cannot predict what impact
any pending or proposed legislation or pending or threatened
litigation will have on the value of the securities.
o Inflation risk. Inflation risk is the risk that the value of assets or
income from investments will be less in the future as inflation
decreases the value of money.
See "Investment Risks" in Part A of the prospectus and "Risk Factors" in
Part B of the prospectus for additional information.
Who Should Invest
You should consider this investment if:
o You want to own securities representing interests in written and
purchased option contracts.
o You seek the potential for capital appreciation on the Reference Asset
subject to a capped return.
o You seek a limited downside protection through a buffer.
o You fully understand that investments made when the Trust is at or
near the capped return may have limited or no upside and will have the
potential to lose more than the stated maximum loss.
o You are willing to hold units for the duration of the Trust in order
to achieve the outcomes that the Trust seeks to provide.
o You are willing to forego any gains in excess of the maximum gain.
You should not consider this investment if:
o You do not fully understand that investments made when the Trust is at
or near the capped return may have limited or no upside and will have
the potential to lose more than the stated 90% maximum loss.
o You are unwilling to hold units for the duration of the Trust in order
to achieve the outcomes that the Trust seeks to provide.
o You are unwilling to forego any gains in excess of the maximum gain,
minus the fees and expenses of the trust (including sales fees).
o You are uncomfortable with the risks of an unmanaged investment in
written and purchased option contracts.
o You are uncomfortable with exposure to the risks associated with the
FLEX Options.
o You are uncomfortable with exposure to the price performance of the
Reference Asset.
o You are seeking an investment that participates in the full
appreciation of the Reference Asset.
o You are seeking unlimited capital appreciation potential and do not
want potential returns capped.
o You are uncomfortable with the risk that you may lose a portion of
your principal.
o You are buying at a time when the RA Price is at or near the Cap.
Fees and Expenses
The amounts below are estimates of the direct and indirect fees and
expenses that you may incur based on a $10 unit price. Actual expenses may
vary.
Percentage
of Public
Offering Amount Per
Investor Fees Price (4) 100 Units
---------------------------- ------------ -----------
Initial sales fee paid
on purchase (1) 1.35% $13.50
Creation and development
fee (2) 0.60 6.00
----------- -----------
Maximum sales fee
(including creation and
development fee) 1.95% $19.50
=========== ===========
Estimated organization costs (3)
(amount per 100 units as
a percentage of the public
offering price) % $____
=========== ===========
Approximate
Annual Fund % of Public
Operating Offering Amount Per
Expenses Price (4) 100 Units
---------------------------- ------------ -----------
Trustee's fee 0.1000% $1.000
Sponsor's supervisory fee 0.0300 0.300
Evaluator's fee 0.0350 0.350
Bookkeeping and
administrative fee 0.0350 0.350
Estimated other trust
operating expenses (5)
----------- -----------
Total % $____
=========== ===========
(1) The initial sales fee provided above is based on the unit price on the
Inception Date. The initial sales charge, also referred to as the
"transactional sales fee," is equal to the difference between the maximum
sales charge and the creation and development fee ("C&D Fee"). The
percentage and dollar amount of the initial sales fee will vary as the unit
price varies. Despite the variability of the initial sales fee, each
unitholder is obligated to pay the entire applicable maximum sales fee.
(2) The C&D Fee compensates the sponsor for creating and developing your trust.
The actual C&D Fee is $0.06 per unit and is paid to the sponsor at the
close of the initial offering period, which is expected to be one day after
the Inception Date. Units purchased after the close of the initial offering
period do not pay the C&D Fee. The percentages provided are based on a $10
unit as of the Inception Date and the percentage amount will vary over
time. If the unit price exceeds $10 per unit, the C&D Fee will be less than
0.60% of the Public Offering Price; if the unit price is less than $10 per
unit, the C&D Fee will exceed 0.60% of the Public Offering Price. However,
in no event will the maximum sales fee exceed 1.95% of a unitholder's
initial investment.
(3) Organization costs include the portfolio consulting fee paid to Milliman
for its assistance in selecting the trust's portfolio.
(4) Based on 100 units with a $10 per unit Public Offering Price as of the
Inception Date.
(5) The estimated trust operating expenses are based upon an estimated trust
size. Because certain of the operating expenses are fixed amounts, if the
trust does not reach such estimated size or falls below the estimated size
over its life, the actual amount of the operating expenses may exceed the
amounts reflected. In some cases, the actual amount of the operating
expenses may greatly exceed the amounts reflected. Other operating expenses
include a licensing fee of 0.07% of the aggregate daily liquidation value
of transactional sales made during the primary offering period paid by the
trust to Milliman for the use of intellectual property owned by Milliman,
but do not include brokerage costs and other transactional fees.
Example
This example helps you compare the costs of this trust with other unit
trusts and mutual funds. In the example we assume that the trust's operating
expenses do not change and the trust's annual return is 5%. Your actual returns
and expenses will vary. Based on these assumptions, you would pay these
expenses for every $10,000 you invest:
1 year $
1.25 years (life of trust)
These amounts are the same regardless of whether you sell your investment
at the end of a period or continue to hold your investment. The example does
not consider any brokerage fees the trust pays or any transaction fees that
broker-dealers may charge for processing redemption requests.
See "Expenses of the Trust" in Part B of the prospectus for additional
information.
Trust Portfolio
Guggenheim Defined Portfolios, Series 2017
Defined Outcome Trust: Large Cap Buffer 10 Portfolio, July 2021
The Trust Portfolio as of the Inception Date, ___________, 2020
------------------------------------------------------------------------------------------
Percentage Cost
Percentage of of
of Number of Market Market Securities
Strike Strike Options Value Per Value To
Description(1) Price Price Contracts Option(2) To Trust(2) Trust
------------------------------------------------------------------------------------------
FLEX OPTIONS -- 100.00%(3)(4)
Purchased Options -- ___%
Purchased Call Options on
SPDR[R] S&P 500[R] ETF
Trust, Expiring
_________, 2021 (4)
Purchased Put Options on
SPDR[R] S&P 500[R] ETF
Trust, Expiring
_________, 2021 (4)
Written Options -- (___%)
Written Call Options on
SPDR[R] S&P 500[R] ETF
Trust, Expiring
_________, 2021 (4)
Written Put Options on
SPDR[R] S&P 500[R] ETF
Trust, Expiring
_________, 2021 (4)
-----------------------
TOTAL OPTIONS % $_________
=======================
(1) Securities are represented by contracts to purchase securities.
(2) The value of FLEX Options is based on intraday prices reflecting an Initial
RA Value of $____ for the Reference Asset. In cases where the FLEX Options
are not traded on the valuation date or where the evaluator determines that
market quotations are unavailable or inappropriate (e.g., due to infrequent
transactions or thin trading), the value of the FLEX Options is based on
the last asked or bid price in the over-the-counter market if available and
appropriate. During the initial offering period such determination for the
Purchased Options will generally be on the basis of ask prices and for the
Written Options will generally be on the basis of bid prices. After the
initial offering period ends, such determination for the Purchased Options
will generally be on the basis of bid prices and for the Written Options
will generally be on the basis of ask prices.
If market quotes, ask prices and bid prices are unavailable or
inappropriate (e.g., due to infrequent transactions or thin trading), each
FLEX Option's value is based on the evaluator's good faith determination of
the fair value of the FLEX Options at its reasonable discretion. To
determine the fair value of the FLEX Options, where available, the
evaluator starts with values generated using the CBOE's Customized Option
Pricing Service ("COPS"), which generates valuations based on the average
valuations of multiple market making contributors. Where such values are
not available through COPS, the evaluator will use the OCC's Flex Reports,
which are model-based valuations made available by OCC. Where such values
are not available and to assess the reasonableness of the above valuations,
the evaluator will generate its own model-based valuations of the FLEX
Options, including using the Black-Scholes model for option valuation, and
use current market quotations and ask/bid prices for comparable listed
options that are more actively traded.
Account Standards Codification 820, "Fair Value Measurements" establishes a
framework for measuring fair value and expands disclosure about fair value
measurements in financial statements for the trust. The framework under the
standard is comprised of a fair value hierarchy, which requires an entity
to maximize the use of observable inputs and minimize the use of
unobservable inputs when measuring fair value. The standard describes three
levels of inputs that may be used to measure fair value:
Level 1: Quote prices (unadjusted) for identical assets or liabilities in
active markets that the trust has the ability to access as of the
measurement date.
Level 2: Significant observable inputs other than Level 1 prices, such as
quoted prices for similar assets or liabilities, quoted prices in markets
that are not active, and other inputs that are observable or can be
corroborated by observable market data.
Level 3: Significant unobservable inputs that reflect on the trust's own
assumptions about the assumptions that market participants would use in
pricing an asset or liability.
The inputs or methodologies used for valuing securities are not necessarily
an indication of the risk associated with investing in those securities.
Changes in valuation techniques may result in transfers in or out of an
investment's assigned level as described above.
The following table summarizes the trust's investment in the FLEX Options
as of the trust's inception, based on inputs used to value them:
LEVEL 1 LEVEL 2 LEVEL 3
--------------------------------------------------
Purchased Options $ -- $ $ --
Written Options $ -- $ $ --
--------------------------------------------------
TOTAL $ -- $ $ --
--------------------------------------------------
The cost of the securities to the sponsor and the sponsor's profit or
(loss) are $__________ and ($___), respectively.
(3) Each FLEX Option entitles the holder thereof (i.e., the purchaser of the
FLEX Option) to purchase (for the call options) or sell (for the put
options) 100 shares of the Reference Asset at the applicable strike price.
(4) This is a non-income-producing security.
================================================================================
UNDERSTANDING YOUR INVESTMENT
How to Buy Units
You can buy units of your trust on any business day by contacting your
financial professional. Public offering prices of units are available daily on
the Internet at www.guggenheiminvestments.com. The unit price includes:
o the value of the securities,
o organization costs,
o the maximum sales fee (which includes an initial sales fee and the creation
and development fee), and
o cash and other net assets in the portfolio.
We often refer to the purchase price of units as the "offer price" or the
"Public Offering Price." We must receive your order to buy units prior to the
close of the New York Stock Exchange (normally 4:00 p.m. Eastern time) to give
you the price for that day. If we receive your order after this time, you will
receive the price computed on the next business day.
Value of the Securities. The sponsor determines the value of the securities
as of the close of the New York Stock Exchange on each day that the exchange is
open. We generally seek to determine the value of the FLEX Options using the
last quoted sale price for the FLEX Options where readily available and
appropriate. In cases where the FLEX Options are not traded on the valuation
date or where we determine that market quotations are unavailable or
inappropriate (e.g., due to infrequent transactions or thin trading), we will
generally value the FLEX Options based on the last asked or bid price in the
over-the-counter market if available and appropriate. During the initial
offering period such determination for the Written Call Options will generally
be on the basis of bid prices. After the initial offering period ends, such
determination for the Written Call Options will generally be on the basis of ask
prices. During the initial offering period such determination for the Purchased
Options will generally be on the basis of ask prices. After the initial offering
period ends, such determination for the Purchased Options will generally be on
the basis of bid prices.
If market quotes, ask prices and bid prices are unavailable or
inappropriate (e.g., due to infrequent transactions or thin trading), we will
determine each FLEX Option's value based on our good faith determination of the
fair value of the FLEX Options at our reasonable discretion. To determine the
fair value of the FLEX Options, where available, we will start with values
generated using the CBOE's COPS, which generates valuations based on the
average valuations of multiple market making contributors. Where such values
are not available through COPS, we will use the OCC's Flex Reports, which are
model-based valuations made available by OCC. Where such values are not
available and to assess the reasonableness of the above valuations, we will
generate our own model-based valuations of the FLEX Options, including using
the Black-Scholes model for option valuation, and use current market quotations
and ask/bid prices for comparable listed options that are more actively
traded.
The ask side price generally represents the price at which dealers,
market-makers or investors in the market are willing to sell a security and the
bid side evaluation generally represents the price that dealers, market-makers
or investors in the market are willing to pay to buy a security. The bid side
evaluation is lower than the ask side evaluation. As a result of this pricing
method, unitholders should expect a decrease in the net asset value per unit on
the day following the end of the initial offering period equal to the difference
between the current ask side evaluation and bid side evaluation of the FLEX
Options.
We determined the initial prices of the securities shown under "Trust
Portfolio" in this prospectus on the date of this prospectus using intraday
prices. On the first day we sell units we will compute the unit price as of the
close of the New York Stock Exchange or at the time the registration statement
filed with the Securities and Exchange Commission becomes effective, if later.
Organization Costs. During the initial offering period, part of your
purchase price includes a per unit amount sufficient to reimburse us for some
or all of the costs of creating your trust. These costs include the costs of
preparing the registration statement and legal documents, legal fees, federal
and state registration fees, the portfolio consulting fee, and the initial fees
and expenses of the trustee. Cash has been deposited in the trust for purposes
of the payment of organization costs. Organization costs will not exceed the
estimate set forth under "Fees and Expenses."
Transactional Sales Fee. The transactional sales fee for the trust is
comprised of an initial sales fee of 1.35% of the Public Offering Price, based
on a $10 unit, which you pay at the time of purchase. This percentage amount of
the transactional sales fee is based on the unit price on the Inception Date.
Because the transactional sales fee equals the difference between the maximum
sales fee (1.95% of the Public Offering Price) and the C&D Fee ($0.06 per
unit), the percentage and dollar amount of the transactional sales fee will
vary as the unit price varies.
Advisory and Fee Accounts. We eliminate your transactional sales fee for
purchases made through registered investment advisers, certified financial
planners or registered broker-dealers who charge periodic fees in lieu of
commissions or who charge for financial planning or for investment advisory or
asset management services or provide these services as part of an investment
account where a comprehensive "wrap fee" is imposed (a "Fee Account"). All
accounts that are not Fee Accounts shall be referred to as "Standard
Accounts."
This discount applies during the initial offering period and in the
secondary market. Your financial professional may purchase units with the Fee
Account CUSIP numbers to facilitate purchases under this discount; however, we
do not require that you buy units with these CUSIP numbers to qualify for the
discount. We reserve the right to limit or deny purchases of units not subject
to the transactional sales fee by investors whose frequent trading activity we
determine to be detrimental to your trust. We, as sponsor, will receive and you
will pay the C&D Fee. See "Expenses of the Trust" in Part B of the prospectus
for additional information.
Employees. We do not charge the portion of the transactional sales fee that
we would normally pay to your financial professional for purchases made by
officers, directors and employees and their family members (spouses, children
under the age of 21 living in the same household and parents) of Guggenheim
Funds and its affiliates, or by employees of selling firms and their family
members (spouses, children under the age of 21 living in the same household,
siblings and parents). You pay only the portion of the fee that the sponsor
retains. Such purchases are also subject to the C&D Fee. This discount applies
during the initial offering period and in the secondary market. Only those
broker-dealers that allow their employees to participate in employee discount
programs will be eligible for this discount.
See "Purchase, Redemption and Pricing of Units" in Part B of the
prospectus for more information regarding buying units.
How We Distribute Units. We sell units to the public through
broker-dealers and other firms. We pay part of the sales fee you pay to these
distribution firms when they sell units. The distribution fee paid is 1.25% of
the Public Offering Price per unit.
Eligible dealer firms and other selling agents that sell units of
Guggenheim Funds unit trusts in the primary market are eligible to receive
additional compensation for volume sales. Such payments will be in addition to
the regular concessions paid to dealer firms as set forth in the applicable
trust's prospectus. For this volume concession, Guggenheim Investment Grade
Corporate Trust 3-7 Year, Investment Grade Corporate Trust 3-7 Year, Guggenheim
Investment Grade Corporate Trust 5-8 Year and Guggenheim Short Duration High
Yield Trust are designated as "Fixed Income Trusts" and all other Guggenheim
Funds unit trusts are designated as "Equity Trusts." Sales of Advisory Series:
Guggenheim Investment Grade Corporate Trust 3-7 Year and Advisory Series:
Investment Grade Corporate 3-7 Year Trust will not count toward this volume
concession. Eligible dealer firms and other selling agents who, during the
previous consecutive 12-month period through the end of the most recent month,
sold primary market units of eligible Guggenheim Funds unit investment trusts
in the dollar amounts shown below will be entitled to up to the following
additional sales concession on primary market sales of units during the current
month of unit investment trusts sponsored by us:
Additional Additional
Concession Concession for
Total Sales for Equity Fixed Income
(in millions) Trust Units Trust Units
------------------------------------------
$25 but less
than $100 0.035% 0.035%
$100 but less
than $150 0.050% 0.050%
$150 but less
than $250 0.075% 0.075%
$250 but less
than $1,000 0.100% 0.100%
$1,000 but less
than $5,000 0.125% 0.100%
$5,000 but less
than $7,500 0.150% 0.100%
$7,500 or more 0.175% 0.100%
Dealer firms or other selling agents deemed to be an underwriter for a
Fixed Income Trust will not be eligible to receive the above sales concession
on the underwritten units for that trust. However, Fixed Income Trust units
sold in an underwriting will be included in the total sales calculation when
determining the appropriate sales concession level for the dealer firm or other
selling agent. Please see the respective Fixed Income Trust's prospectus for
more information.
Eligible unit trusts include Fixed Income Trusts and Equity Trusts sold in
the primary market. Redemptions of units during the primary offering period
will reduce the amount of units used to calculate the volume concessions. In
addition, dealer firms will not receive volume concessions on the sale of units
which are not subject to a transactional sales fee. However, such sales will be
included in determining whether a firm has met the sales level breakpoints for
volume concessions.
Guggenheim Funds reserves the right to modify or terminate the volume
concession program at any time. The sponsor may also pay to certain dealers an
administrative fee for information or service used in connection with the
distribution of trust units. Such amounts will be in addition to any concessions
received for the sale of units.
In addition to the concessions described above, the sponsor may pay
additional compensation out of its own assets to broker-dealers that meet
certain sales targets and that have agreed to provide services relating to your
trust to their customers.
Other Compensation and Benefits to Broker-Dealers. The sponsor, at its own
expense and out of its own profits, may provide additional compensation and
benefits to broker-dealers who sell shares of units of this trust and other
Guggenheim products. This compensation is intended to result in additional
sales of Guggenheim products and/or compensate broker-dealers and financial
advisors for past sales. A number of factors are considered in determining
whether to pay these additional amounts. Such factors may include, but are not
limited to, the level or type of services provided by the intermediary, the
level or expected level of sales of Guggenheim products by the intermediary or
its agents, the placing of Guggenheim products on a preferred or recommended
product list, access to an intermediary's personnel, and other factors.
The sponsor makes these payments for marketing, promotional or related
expenses, including, but not limited to, expenses of entertaining retail
customers and financial advisers, advertising, sponsorship of events or
seminars, obtaining information about the breakdown of unit sales among an
intermediary's representatives or offices, obtaining shelf space in
broker-dealer firms and similar activities designed to promote the sale of the
sponsor's products. The sponsor may make such payments to many intermediaries
that sell Guggenheim products. The sponsor may also make certain payments to, or
on behalf of, intermediaries to defray a portion of their costs incurred for the
purpose of facilitating unit sales, such as the costs of developing trading or
purchasing trading systems to process unit trades.
Payments of such additional compensation, some of which may be
characterized as "revenue sharing," may create an incentive for financial
intermediaries and their agents to sell or recommend a Guggenheim product,
including the trust, over products offered by other sponsors or fund companies.
These arrangements will not change the price you pay for your units.
We generally register units for sale in various states in the United
States. We do not register units for sale in any foreign country. It is your
financial professional's responsibility to make sure that units are registered
or exempt from registration if you are a foreign investor or if you want to buy
units in another country. This prospectus does not constitute an offer of units
in any state or country where units cannot be offered or sold lawfully. We may
reject any order for units in whole or in part.
We may gain or lose money when we hold units in the primary or secondary
market due to fluctuations in unit prices. The gain or loss is equal to the
difference between the price we pay for units and the price at which we sell or
redeem them. We may also gain or lose money when we deposit securities to
create units. For example, we lost the amount set forth in the "Trust
Portfolio" on the initial deposit of securities into the trust.
See "Purchase, Redemption and Pricing of Units" in Part B of the
prospectus for additional information.
How to Sell Your Units
You can sell your units on any business day by contacting your financial
professional or, in some cases, the trustee. Unit prices are available daily on
the Internet at www.guggenheiminvestments.com or through your financial
professional. We often refer to the sale price of units as the "liquidation
price." Certain broker-dealers may charge a transaction fee for processing unit
redemptions or sale requests.
Until the end of the initial offering period or six months after the
Inception Date, at the discretion of the sponsor, the price at which the
trustee will redeem units and the price at which the sponsor may repurchase
units include estimated organization costs. After such period, the amount paid
will not include such estimated organization costs.
Selling Units. We do not intend to but may maintain a secondary market for
units. This means that if you want to sell your units, we may buy them at the
current price which is based on their net asset value. We may then resell the
units to other investors at the Public Offering Price or redeem them for the
redemption price. Our secondary market repurchase price is generally the same
as the redemption price. Certain broker-dealers might also maintain a secondary
market in units. You should contact your financial professional for current
unit prices to determine the best price available. We may discontinue our
secondary market at any time without notice. Even if we do not make a market,
you will be able to redeem your units with the trustee on any business day for
the current price.
Redeeming Units. You may also be able to redeem your units directly with
the trustee, The Bank of New York Mellon, on any day the New York Stock Exchange
is open. The trustee must receive your completed redemption request one hour
prior to the close of the New York Stock Exchange for you to receive the unit
price for a particular day. (For what constitutes a completed redemption
request, see "Purchase, Redemption and Pricing of Units--Redemption" in Part B
of the prospectus.) If your request is received after that time or is incomplete
in any way, you will receive the next price computed after the trustee receives
your completed request. Rather than contacting the trustee directly, your
financial professional may also be able to redeem your units by contacting the
sponsor. If you redeem your units, the trustee will generally send you a payment
for your units no later than two business days after it receives all necessary
documentation.
For more complete information regarding selling or redeeming your units,
see "Purchase, Redemption and Pricing of Units" in Part B of the prospectus.
Distributions
Distributions. Your trust generally pays distributions from its net
investment income, if any, along with any excess capital on each distribution
date to unitholders of record on the preceding record date. Any distributions
will be paid in cash.
In some cases, your trust might pay a special distribution if it holds an
excessive amount of principal pending distribution. For example, this could
happen as a result of a merger or similar transaction involving a company whose
security is in your portfolio. In addition, your trust may pay a special
distribution in order to maintain the qualification of the trust as a regulated
investment company or to provide funds to make any distribution for a taxable
year in order to avoid imposition of any income or excise tax on undistributed
income in the trust. The amount of your distributions will vary from time to
time as companies change their dividends, trust expenses change or as a result
of changes in the trust's portfolio.
Reports. The trustee will send your financial professional a statement
showing income and other receipts of your trust for each distribution. Each
year the trustee will also provide an annual report on your trust's activity
and certain tax information. You can request copies of security evaluations to
enable you to complete your tax forms and audited financial statements for your
trust, if available.
See "Administration of the Trust" in Part B of the prospectus for
additional information.
Investment Risks
All investments involve risk. This section describes the main risks that
can impact the value of the securities in your trust. You should understand
these risks before you invest. You could lose some or all of your investment in
the trust. If the value of the securities falls, the value of your units will
also fall. We cannot guarantee that your trust will achieve its objective or
that your investment return will be positive over any period.
Passive investment risk. The value of your investment may fall over time.
The trust will generally hold, and may continue to buy, the same securities
even though a security's outlook, rating, market value or yield may have
changed.
Market risk. Market risk is the risk that a particular security in the
trust, the trust itself or securities in general may fall in value. Market value
may be affected by a variety of factors, including general securities markets
movements, changes in the financial condition of an issuer or a sector, changes
in perceptions about an issuer or a sector, interest rates and inflation and
governmental policies and litigation.
Although we carefully supervise your portfolio, you should remember that
we do not manage the portfolio. Your trust will not sell a security solely
because the market value falls, as is possible in a managed fund.
Capped upside and limited downside protection. The target return for units
purchased on the trust's inception date and held for the life of the trust is
based on the price performance of the Reference Asset, is subject to a capped
upside and has a limited downside protection. Even if there are significant
increases in the price performance of the Reference Asset, the amounts you may
receive are capped. Unitholders may experience significant losses on their
investment, even though there is limited downside protection.
You may realize a return that is higher or lower than the intended returns
or losses as a result of redeeming units prior to the Mandatory Termination
Date, where the FLEX Options are otherwise liquidated by the trust prior to
expiration, if a Corporate Action occurs with respect to the Reference Asset,
or if there are increases in potential tax-related expenses and other expenses
of the trust above estimated levels.
Options risk. The value of the FLEX Options will be affected by changes in
the price of the Reference Asset, the value of the Index and its underlying
securities, changes in interest rates, changes in the actual and perceived
volatility of the stock market and the Reference Asset, Index and the underlying
securities and the remaining time to the Option Expiration Date. The value of
the FLEX Options does not increase and decrease at the same rate as the price of
shares of the Reference Asset (although they generally move in the same
direction). However, as a FLEX Option approaches its expiration date, its value
increasingly moves with the value of the Index. The value of the Written Call
Options reduces the value of your units. The Written Call Options create an
obligation to potentially make a payment in contrast to the Purchased Options,
which creates an obligation to potentially receive a payment. As the value of
the Written Call Options contracts increase, it has a negative impact on the
value of your units.
When the trust buys option contracts, the value of your units increases,
but if the value of these options contracts decreases, it has a negative impact
on the value of your units. The trust may experience substantial downside from
specific option contracts positions, and certain option contract positions may
expire worthless.
Underlying Reference Asset performance and equity risk. The FLEX Options
contracts represent indirect positions in the Reference Asset and are subject
to changes in value as the price of shares of the Reference Asset rises or
falls. The settlement value of the FLEX Options is based on the Reference Asset
Closing Value on the Option Expiration Date, and will be substantially
determined by market conditions and the price of shares of the Reference Asset,
the value of the Index and the value of securities comprising the Index as of
such time. The value of the Reference Asset will fluctuate over time based on
changes in the value of the stocks held by the Reference Asset, which may be
impacted by changes in general economic conditions, expectations for future
economic growth and corporate profits, interest rates and the supply and demand
for stocks in the United States. The value of the trust does not appreciate due
to dividend payments by the Reference Asset. The trust seeks to provide target
returns or losses on the price performance of the Reference Asset.
Although common stocks have historically generated higher average returns
than fixed-income securities over the long term, common stocks also have
experienced significantly more volatile returns. Common stocks are structurally
subordinated to preferred stocks, bonds and other debt instruments in a
company's capital structure and represent a residual claim on the issuer's
assets that have no value unless such assets are sufficient to cover all other
claims.
Unitholders will not have control, voting rights or rights to receive cash
dividends or other distributions or other rights that holders of a direct
investment in the Reference Asset would have.
Credit risk. An issuer, guarantor or counterparty of a security in the
trust may be unable or unwilling to meet its obligation on the security. The
OCC acts as guarantor and central counterparty with respect to the FLEX
Options. As a result, the ability of the trust to meet its objective depends on
the OCC being able to meet its obligations.
Exchange-traded funds. The FLEX Options reference the price performance of
the Reference Asset, which is an exchange-traded fund. Shares of
exchange-traded funds frequently trade at a discount from their net asset value
in the secondary market. This risk is separate and distinct from the risk that
the net asset value of fund shares may decrease. The amount of such discount
from net asset value is subject to change from time to time in response to
various factors. Exchange-traded funds are subject to the risk of an inability
to meet the exchange-traded fund's investment objective. The FLEX Options
reference the price performance of the Reference Asset, which is adversely
impacted by its operating expenses.
Exchange-traded funds also face index correlation risk which is the risk
that the performance of an exchange-traded fund will vary from the actual
performance of the exchange-traded fund's target index, known as "tracking
error." This can happen due to transaction costs, market impact, corporate
actions (mergers and spinoffs) and timing variances.
Selection risk. Securities selected according to this strategy may not
perform as intended. The trust is exposed to additional risk due to its policy
of investing in accordance with an investment strategy. Although the trust's
investment strategy is designed to achieve the trust's investment objective,
the strategy may not prove to be successful. The investment decisions may not
produce the intended results and there is no guarantee that the investment
objective will be achieved.
Legislation risk. Tax legislation proposed by the President or Congress,
tax regulations proposed by the U.S. Treasury or positions taken by the
Internal Revenue Service ("IRS") could affect the value of the trust by
changing the taxation or tax characterizations of the portfolio securities or
of dividends and other income paid by or related to such securities. Congress
has considered such proposals in the past and may do so in the future. Various
legislative initiatives will be proposed from time to time in the United States
and abroad that may have a negative impact on certain of the companies
represented in the Index. In addition, litigation regarding any of the issuers
of the securities or of the industries represented by these issuers may
negatively impact the share prices of these securities. No one can predict
whether any legislation will be proposed, adopted or amended by Congress and no
one can predict the impact that any other legislation might have on the trust
or the securities included in the Index.
Tax risk. The trust intends to treat any income it may derive from the FLEX
Options as "qualifying income" under the provisions of the Internal Revenue Code
of 1986, as amended (the "Code"), applicable to "regulated investment companies"
("RICs"), based on language in the Code. In addition, based upon language in the
legislative history of the relevant Code sections, the trust intends to treat
the issuer of the FLEX Options as the Reference Asset, which, assuming the
Reference Asset qualifies as a RIC, would allow the trust to qualify for special
rules in the RIC diversification requirements. If the income is not qualifying
income or the issuer of the FLEX Options is not appropriately the Reference
Asset, the trust could lose its own status as a RIC. The Reference Asset may be
classified as a RIC for federal income tax purposes but may have significant
exposure to commodities and other derivative products. RICs are required to meet
certain income and diversifications tests in order to avoid federal income tax
at the RIC level. Most commodity income will not be qualifying income for a RIC
for such purposes. Derivative income may or may not be qualifying income
depending upon whether the income relates to the RIC's business of investing in
securities. The trust has not reviewed the assets or income of the underlying
RICs. If a RIC in the trust's portfolio does not meet the RIC qualification
tests, the RIC would be taxed as a C corporation and returns from that entity
would be on an after-tax basis. If the Reference Asset is not classified as a
RIC, the manner in which the FLEX Options are treated for the purposes of the
trust's diversification tests may change and, in certain circumstances, the
trust could lose its own RIC status. The trust is investing in offsetting
positions in regard to the Reference Asset. The result of the offsetting
positions is that the trust may recognize little or no long-term capital gain
income even if the trust holds its positions for more than the long-term capital
gain holding period. Because of the loss of long-term capital gains from
portfolio investments, in some factual circumstances investors could have a
lower after-tax return from investing in the trust than from investing directly
in the Reference Asset. The trust may have significant exposure to the FLEX
Options on the Reference Asset.
Although the FLEX Options are documented as options, there are other
derivative contracts that may be economically identical or substantially
similar that have significantly different tax treatment. For example, if the
FLEX Options were collapsed into a single contract the FLEX Options may be
treated as a notional principal contract under the proposed regulations. The
proposed regulations would require the trust to recognize income periodically
over the term of the contracts if the contracts were notional principal
contracts. Also, option premiums are not taken into income under current law
until the option lapses or is exercised. If the FLEX Options were
recharacterized, there may be a requirement to recognize the option premiums
immediately upon receipt. Since the trust is not planning on including income
from the contract periodically over the life of the contract or including the
option premiums in income, a recharacterization could affect the ability of the
trust to meet certain RIC qualification tests.
If the trust did not qualify as a RIC for any taxable year and certain
relief provisions were not available, the trust's taxable income would be
subject to tax at the trust level and to a further tax at the shareholder level
when such income is distributed. In such event, in order to re-qualify for
taxation as a RIC, the trust might be required to recognize unrealized gains,
pay substantial taxes and interest and make certain distributions. This would
cause investors to incur higher tax liabilities than they otherwise would have
incurred, which would have a negative impact on trust returns. In such event, it
may be determined to reorganize or close the trust or materially change the
trust's investment objective and strategies.
The options included in the trust are exchange-traded options. Under
Section 1256 of the Code, certain types of exchange-traded options are treated
as if they were sold ("marked to market") at the end of each year. The trust
does not believe that the positions held by the trust will be subject to
Section 1256, which means that the positions will not be marked to market, but
the positions will be subject to the straddle rules. Such treatment would cause
the trust to have taxable income without receiving cash. In order to maintain
its RIC qualification, the trust must distribute at least 90% of its income
annually. Although the trust does not believe the options are subject to the
1256 rules, if it were later determined that the options were subject to the
1256 rules the trust may retroactively lose its RIC qualification and be taxed
as a C corporation. In the event that the trust fails to qualify as a RIC, the
trust will promptly notify unit holders of the implications of that failure.
In the "Taxes" section of this prospectus the potential for capital gains
treatment is described. The Code limits the availability of capital gains
treatment in certain circumstances. If a unit holder holds units as inventory,
the unit holder will not be eligible for capital gains on disposition of the
units. If the transaction is marketed or sold as producing capital gains from a
straddle position or the transaction is identified as a conversion transaction
by the IRS, the unit holder will not be eligible for capital gains. The sponsor
has represented that the transaction will not be marketed or sold as producing
capital gains from a straddle position. The structure of the trust's investments
has not been identified by the IRS as a conversion transaction. However, the
behavior of brokers and dealers distributing the product could affect the
character of the gain on disposition. The IRS could at some future point
identify the structure of the trust's investments as a conversion transaction.
In such a situation, unit holders would not be eligible for capital gains.
Dilution risk. You could experience a dilution of your investment by
redemption activity or higher than expected expenses. There is no assurance
that your investment will maintain its proportionate share in the trust's
profits and losses, or that your investment will be in the same portfolio for
the duration of the trust.
Implied volatility risk. The value of the FLEX Options may change with the
implied volatility of the Reference Asset, the Index and the securities
comprising the Index. No one can predict whether implied volatility will rise
or fall in the future.
Liquidity risk. The value of a FLEX Option will fall in value if trading in
the FLEX Option is limited or absent. No one can guarantee that a liquid
secondary trading market will exist for the FLEX Options. Trading in the FLEX
Options may be less deep and liquid than in certain other securities. The FLEX
Options may be less liquid than certain non-customized options. The sponsor
expects that the trust will hold 10% or less of its net asset value in illiquid
securities. In a less liquid market for the FLEX Options, liquidating the FLEX
Options may require the payment of a premium or acceptance of a discounted price
and may take longer to complete. In a less liquid market for the FLEX Options,
the liquidation of a large number of options may more significantly impact the
price. A less liquid trading market may adversely impact the value of the FLEX
Options and your units. It is not anticipated that there will be an existing
market for options with the exact customized terms as the FLEX Options, and an
active market may not be established. Prior to the trust's inception date, there
has been no existing trading market for the FLEX Options.
Valuation risk. Under certain circumstances, current market prices may not
be available with respect to the FLEX Options. Under those circumstances, the
value of the FLEX Options will require more reliance on the judgment of the
evaluator than that required for securities for which there is an active
trading market. This creates a risk of mispricing or improper valuation of the
FLEX Options, which could impact the valuation of units.
Cybersecurity risk. The trust may be susceptible to potential risks
through breaches in cybersecurity. A breach in cybersecurity refers to both
intentional and unintentional events that may cause the trust to lose
proprietary information, suffer data corruption or lose operational capacity.
Such events could cause the sponsor of the trust to incur regulatory penalties,
reputational damage, additional compliance costs associated with corrective
measures and/or financial loss. Cybersecurity breaches may involve unauthorized
access to digital information systems utilized by the trust through "hacking"
or malicious software coding, but may also result from outside attacks such as
denial-of-service attacks through efforts to make network services unavailable
to intended users. In addition, cybersecurity breaches of the trust's
third-party service providers, or issuers in which the trust invests, can also
subject the trust to many of the same risks associated with direct
cybersecurity breaches. The sponsor of the trust and third-party service
providers have established risk management systems designed to reduce the risks
associated with cybersecurity. However, there is no guarantee that such efforts
will succeed, especially because the trust does not directly control the
cybersecurity systems of issuers or third-party service providers.
Early termination risk. The trustee has the power to terminate your trust
early in limited cases as described under "Understanding Your Investment--How
Your Trust Works--Termination of Your Trust," including if the value of the
trust is less than $1 million or less than 40% of the value of the securities
in the trust at the end of the initial offering period. If the trust terminates
early, the trust may suffer losses and be unable to achieve its investment
objective. This could result in a reduction in the value of units and result in
a significant loss to investors.
Inflation risk. Inflation risk is the risk that the value of assets or
income from investments will be less in the future as inflation decreases the
value of money.
Significant unitholders risk. There may be unitholders of the trust who
hold a significant portion of the trust and, as result, a redemption by such
significant holder may have a material impact on the size, expenses and
viability of the trust.
See "Risk Factors" in Part B of the prospectus for additional
information.
How the Trust Works
Your Trust. Your trust is a unit investment trust registered under the
Investment Company Act of 1940 and the Securities Act of 1933. We created your
trust under a trust agreement between Guggenheim Funds Distributors, LLC (as
sponsor, evaluator and supervisor) and The Bank of New York Mellon (as trustee).
To create your trust, we deposited contracts to purchase securities with the
trustee along with an irrevocable letter of credit or other consideration to pay
for the securities. In exchange, the trustee delivered units of your trust to
us. Each unit represents an undivided interest in the assets of your trust.
These units remain outstanding until redeemed or until your trust terminates.
Changing Your Portfolio. Your trust is not a managed fund. Unlike a
managed fund, we designed your portfolio to remain relatively fixed after its
inception. Your trust will generally buy and sell securities:
o to pay expenses,
o to issue additional units or redeem units,
o in limited circumstances to protect the trust,
o to avoid direct or indirect ownership of a passive foreign investment
company,
o to make required distributions or avoid imposition of taxes on the
trust,
o to maintain the qualification of the trust as a regulated investment
company, or
o as permitted by the trust agreement.
You will not be able to dispose of or vote any of the securities in your
trust.
We will increase the size of your trust as we sell units. When we create
additional units, we will seek to replicate the existing portfolio. In certain
cases, the trustee may need additional time to acquire the securities necessary
to create units and consequently, the trust may not be fully invested at all
times, which may impact the trust's performance. When your trust buys
securities, it will pay brokerage or other acquisition fees. You could
experience a dilution of your investment because of these fees and fluctuations
in security prices between the time we create units and the time your trust buys
the securities. When your trust buys or sells securities, we, acting in an
agency capacity, may direct that the trust places orders with and pays brokerage
commissions to brokers that sell units or are affiliated with your trust. We
will not select firms to handle these transactions on the basis of their sale of
units of your trust or any other products sponsored by us. We cannot guarantee
that your trust will keep its present size and composition for any length of
time.
Termination of Your Trust. Your trust will terminate no later than the
termination date listed in the "Investment Summary" section of this prospectus.
The trustee may terminate your trust early if the value of the trust is less
than $1 million or less than 40% of the value of the securities in the trust at
the end of the initial offering period. At this size, the expenses of your
trust may create an undue burden on your investment. Investors owning
two-thirds of the units in your trust may also vote to terminate the trust
early. We may also terminate your trust in other limited circumstances.
The trustee will notify you of any termination and sell any remaining
securities. The trustee will send your final distribution to you within a
reasonable time following liquidation of all the securities after deducting
final expenses. Your termination distribution may be less than the price you
originally paid for your units.
See "Administration of the Trust" in Part B of the prospectus for
additional information.
General Information
Guggenheim Funds. Guggenheim Funds Distributors, LLC specializes in the
creation, development and distribution of investment solutions for advisors and
their valued clients. We operate as a subsidiary of Guggenheim Partners, LLC.
During our history we have been active in public and corporate finance,
have underwritten closed-end funds and have distributed bonds, mutual funds,
closed-end funds, exchange-traded funds, structured products and unit trusts in
the primary and secondary markets. We are a registered broker-dealer and member
of the Financial Industry Regulatory Authority (FINRA). If we fail to or cannot
perform our duties as sponsor or become bankrupt, the trustee may replace us,
continue to operate your trust without a sponsor, or terminate your trust. You
can contact us at 227 W. Monroe Street, Chicago, Illinois 60606 or by using the
contacts listed on the back cover of this prospectus. Guggenheim Funds
personnel may from time to time maintain a position in certain securities held
by your trust.
Guggenheim Funds and your trust have adopted a code of ethics requiring
Guggenheim Funds' employees who have access to information on trust
transactions to report personal securities transactions. The purpose of the
code is to avoid potential conflicts of interest and to prevent fraud,
deception or misconduct with respect to your trust.
See "Administration of the Trust" in Part B of the prospectus for
additional information.
Portfolio Consultant. Milliman Financial Risk Management LLC has been
selected by the sponsor to serve as the portfolio consultant for the trust. As
portfolio consultant, Milliman will assist the sponsor with the selection of the
trust's portfolio. For its service as portfolio consultant, Milliman will be
paid by the trust a fee of 0.20% of the aggregate daily liquidation value of
transactional sales made during the primary offering period at the close of the
initial offering period. While the sponsor is responsible for supervising the
trust's portfolio, neither the sponsor nor the portfolio consultant manage the
trust.
The portfolio consultant is not an affiliate of the sponsor. The portfolio
consultant may use the list of securities included in your trust portfolio in
its independent capacity as an investment adviser and distribute this
information to various individuals and entities. The portfolio consultant may
recommend or effect transactions in the securities included in your trust. This
may have an adverse effect on the prices of the securities included in your
trust. This also may have an impact on the price your trust pays for the
securities and the price received upon unit redemptions or trust termination.
The portfolio consultant may act as agent or principal in connection with the
purchase and sale of securities, including the securities included in your
trust. The portfolio consultant's research department may receive compensation
based on commissions generated by research and/or sales of units.
You should note that the selection criteria was applied to the securities
for inclusion in your trust prior to the Inception Date. After this time, the
securities included in your trust may no longer meet the selection criteria.
Should a security no longer meet the selection criteria, we will generally not
remove the security from your trust. In offering the units to the public,
neither the sponsor nor any broker-dealers are recommending any of the
individual securities but rather the entire pool of securities in your trust,
taken as a whole, which are represented by the units.
The Trustee. The Bank of New York Mellon is the trustee of your trust and
has custody of the trust assets other than FLEX Options. It is a trust company
organized under New York law. You can contact the trustee by calling the
telephone number on the back cover of this prospectus or write to Unit
Investment Trust Division, 2 Hanson Place, 12th Fl., Brooklyn, New York 11217.
We may remove and replace the trustee in some cases without your consent. The
trustee may also resign by notifying the sponsor and investors.
See "Administration of the Trust" in Part B of the prospectus for
additional information.
FLEX Option Custodian. ED&F Man Capital Markets Inc., a member of the OCC,
serves as custodian for FLEX Options held by the trust.
See "Administration of the Trust" in Part B of the prospectus for
additional information.
Expenses
Your trust will pay various expenses to conduct its operations. The
"Investment Summary" section of this prospectus shows the estimated amount of
these expenses.
Your trust will pay a fee to the trustee for its services. The trustee
also benefits when it holds cash for the trust in non-interest bearing
accounts. Your trust will reimburse the sponsor as supervisor and evaluator for
providing portfolio supervisory services, evaluating your portfolio and
performing bookkeeping and administrative services. Our reimbursements may
exceed the costs of the services we provide to your trust but will not exceed
the costs of services provided to all Guggenheim Funds unit investment trusts
in any calendar year. In addition, the trustee may reimburse the sponsor out of
its own assets for services performed by employees of the sponsor in connection
with the operation of your trust. All of these fees may adjust for inflation
without your approval.
Your trust will pay a fee to the sponsor for creating and developing the
trust, including determining the trust's objective, policies, composition and
size, selecting service providers and information services, and for providing
other similar administrative and ministerial functions. Your trust pays this
"creation and development fee" of $0.06 per unit from the assets of the trust
as of the close of the initial public offering period. The sponsor does not use
the fee to pay distribution expenses or as compensation for sales efforts.
Your trust will also pay its general operating expenses, including any
licensing fees. The trust will pay a licensing fee to Milliman for the use of
trademarks, trade names or other intellectual property owned by Milliman. The
licensing fee received by Milliman is equal to 0.07% of the aggregate daily
liquidation value of transactional sales made during the primary offering
period.
Your trust may also pay expenses such as trustee expenses (including legal
and auditing expenses), custodial fees, organization expenses, various
governmental charges, fees for extraordinary trustee services, costs of taking
action to protect your trust, costs of indemnifying the trustee and Guggenheim
Funds, legal fees and expenses, expenses incurred in contacting you and costs
incurred to reimburse the trustee for advancing funds to meet distributions.
Your trust may pay the costs of updating its registration statement each year.
The trustee may sell securities to pay trust expenses.
See "Expenses of the Trust" in Part B of the prospectus for additional
information.
Report of Independent Registered Public Accounting Firm
Sponsor and Unitholders
Guggenheim Defined Portfolios, Series 2017
Opinion on the financial statements
We have audited the accompanying statement of financial condition,
including the trust portfolio on pages 16 and 17 of Guggenheim Defined
Portfolios, Series 2017 (the "Trust") as of ___________, 2020, the initial date
of deposit, and the related notes (collectively referred to as the "financial
statements"). In our opinion, the financial statements present fairly, in all
material respects, the financial position of the Trust as of ___________, 2020,
in conformity with accounting principles generally accepted in the United
States of America.
Basis for opinion
These financial statements are the responsibility of Guggenheim Funds
Distributors, LLC, the Sponsor. Our responsibility is to express an opinion on
the Trust's financial statements based on our audit. We are a public accounting
firm registered with the Public Company Accounting Oversight Board (United
States) ("PCAOB") and are required to be independent with respect to the Trust
in accordance with the U.S. federal securities laws and the applicable rules
and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement, whether due to error or fraud. The Trust is not required to have,
nor were we engaged to perform, an audit of its internal control over financial
reporting. As part of our audit we are required to obtain an understanding of
internal control over financial reporting but not for the purpose of expressing
an opinion on the effectiveness of the Trust's internal control over financial
reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess the risks of material
misstatement of the financial statements, whether due to error or fraud, and
performing procedures that respond to those risks. Such procedures included
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our audit also included evaluating the accounting
principles used and significant estimates made by management, as well as
evaluating the overall presentation of the financial statements. Our procedures
included confirmation of cash or irrevocable letter of credit deposited for the
purchase of securities as shown in the statement of financial condition as of
___________, 2020 by correspondence with The Bank of New York Mellon, Trustee.
We believe that our audit provides a reasonable basis for our opinion.
Grant Thornton LLP
We have served as the auditor of one or more of the unit investment
trusts, sponsored by Guggenheim Funds Distributors, LLC and its predecessor
since 2002.
Chicago, Illinois
___________, 2020
Guggenheim Defined Portfolios, Series 2017
Statement of Financial Condition
as of the Inception Date, ___________, 2020
Investment in securities
Value of purchased options (1)(2) $
Cash (3)
----------
$
==========
Liabilities and interest of unitholders
Liabilities:
Value of written options (1)(2) $
Organization costs (3)
Creation and development fee (6)
----------
----------
Interest of unitholders:
Cost to unitholders (5)
Less: transactional sales fee (4)
Less: organization costs and C&D fee (3)
----------
Net interest of unitholders
----------
Total $
==========
Number of units
==========
Net Asset Value per Unit $
==========
-------------------
(1) Aggregate cost of the securities is based on the closing sale price
evaluations as determined by the trustee.
(2) A letter of credit has been deposited with The Bank of New York Mellon,
trustee, covering the funds (aggregating $_______) necessary for the
purchase of the securities in the trust, represented by purchase contracts.
(3) A portion of the Public Offering Price represents an amount of cash
deposited to pay for all or a portion of the costs incurred in establishing
the trust. These costs have been estimated at $____ per 100 units of the
trust. A distribution will be made as of the close of the initial offering
period or six months after the initial date of deposit (at the discretion
of the sponsor) to an account maintained by the trustee from which this
obligation of the investors will be satisfied. Organization costs will not
be assessed to units that are redeemed prior to the close of the initial
offering period or six months after the initial date of deposit (at the
discretion of the sponsor). To the extent that actual organization costs
are greater than the estimated amount, only the estimated organization
costs added to the Public Offering Price will be deducted from the assets
of the trust.
(4) The aggregate cost to unitholders includes a maximum sales fee, which
consists of an initial sales fee and a creation and development fee. The
initial sales fee is equal to the difference between the maximum sales fee
and the creation and development fee. On the Inception Date, the maximum
sales fee is 1.95% of the Public Offering Price (equivalent to ____% of the
net amount invested).
(5) The aggregate cost to investors includes the applicable sales fee, assuming
no reduction of sales fees.
(6) The trust is committed to pay a creation and development fee of $6.00 per
100 units at the close of the initial public offering period. The creation
and development fee will not be assessed to units that are redeemed prior
to the close of the initial offering period.
APPENDIX
Hypothetical Option Expiration Examples
The following table and examples illustrate the payments on the FLEX
Options and how the trust's investment strategy is intended to work. The
hypothetical payments are based upon an Initial RA Value and estimated fees and
expenses on the day before the trust's inception date. Consequently, an
investor will not receive these hypothetical outcomes.
The table and examples are hypothetical illustration of the mathematical
principles underlying the FLEX Options and the trust's investment strategy. The
table and examples are not intended to predict or project the performance of
the FLEX Options or the trust. The actual distributions that you receive will
vary from these illustrations with changes in expenses and early liquidation of
FLEX Options. For an explanation of the FLEX Option computations and the
trust's intended returns on a per unit basis, please refer to the discussion
under "Investment Summary -- Principal Investment Strategy" and "Investment
Summary -- Assets Held by the Trust -- The FLEX Options."
The examples assume that units are not sold back to us or redeemed early.
All figures in the table and examples below assume that the FLEX Options are
purchased on the business day prior to the trust inception date and held until
the applicable FLEX Option expiration date, and units of the trust are held
until the trust's Mandatory Termination Date. Unitholders will not purchase
units with FLEX Options at the prices provided below but at the unit price
computed as of the close of the New York Stock Exchange on a unitholder's date
of purchase. No unitholders will purchase at the initial Net Asset Value per
Unit as shown under "Statement of Financial Condition". Those returns are for
illustrative purposes only and the examples are intended to reflect the
intended return on the portfolio without application of sales fees, expenses or
organization costs. Amounts assume all proceeds on the FLEX Options are
received when due and that there are no defaults. Unitholders will pay a sales
fee in connection with the purchase of units which is shown under "Investment
Summary -- Fees and Expenses" but such amounts are not deducted from the
amounts shown in the examples so are not reflected in the examples as separate
amounts. Unitholders will pay organization costs of the trust which are shown
under "Investment Summary -- Fees and Expenses" but those amounts are paid by
cash deposited at inception so are not reflected in the examples as separate
amounts. Unitholders will bear the trust's annual operating expenses shown
under "Investment Summary -- Fees and Expenses" but those amounts are paid upon
the trust's termination or as units are redeemed so are not reflected in the
examples as separate amounts. The examples below also do not reflect the impact
of taxes. The amounts shown in the table below reflect estimated fees,
organization costs and annual operating expenses as of the day before the
trust's inception, which may vary from the amounts shown under "Investment
Summary - Fees and Expenses". Unitholders should review the "Investment Summary
-- Fees and Expenses" section to understand all fees and expenses borne by
unitholders in an investment in units of the trust.
The following table illustrates the payments on the FLEX Options and
examples of hypothetical trust returns (including a loss) for units held from
the trust inception date to the scheduled mandatory termination date of the
trust. The amounts shown for the "Hypothetical Total Amount for Trust" reflect
proceeds from the FLEX Options. The "Hypothetical Returns" based on the "Initial
NAV" represents the intended percentage return on the portfolio of FLEX Options
over the life of the trust gross of any sales fees or organization costs. It is
calculated by taking the amount shown under "Hypothetical Total Amount for
Trust" divided by the Initial NAV of $10. It is for illustrative purposes only
and does not represent the price any unitholder will pay for units or the
returns any unitholders will receive. The "Hypothetical Returns" based on the
"Initial Unit Price" represents the percentage return a unitholder would receive
if they bought units at the Initial Unit Price and received the amount shown
under "Hypothetical Total Amount for Trust" on such units. The "Hypothetical
Returns" based on the "Fee Account Initial Unit Price" represents the percentage
return a unitholder would receive if they bought units at the Fee Account
Initial Unit Price and received the amount shown under "Hypothetical Total
Amount for Trust" on such units.
The amounts and examples are based on various hypothetical levels of the
"RA Price" on the Option Expiration Date. The "Percentage Change" is the RA
Price at the close of the market on the Option Expiration Date divided by the
Initial RA Value at trust inception and is shown for illustrative purposes only
based on these different RA Prices. These percentage changes represent the
percentage increase or decrease of the Reference Asset's prices from the
trust's inception to the close of the New York Stock Exchange on the Option
Expiration Date.
The amounts under "Hypothetical Option Proceeds (per Unit)" for each of
the four FLEX Options represent the net amounts due or owed, per trust unit, at
the Option Expiration Date on each Option based on the corresponding "RA
Price". The amounts under "Hypothetical Total Amount for Trust" are the sums of
those four amounts. Positive amounts represent an amount to be received by the
trust on the FLEX Options. Negative amounts represent an amount to be paid by
the trust on the FLEX Options. The FLEX Options are intended to be liquidated
on the Option Expiration Date, rather than be exercised, in order to avoid
having the trust receive shares of the Reference Asset or be obligated to
deliver shares of the Reference Asset. As a result, the return actually
realized on the FLEX Options upon liquidation could vary from the returns that
would be realized if the FLEX Options were exercised based on the price of
shares of the Reference Asset as of the close of the market on the Option
Expiration Date.
All figures in the table assume that the FLEX Options are held to Option
Expiration Date and units are held until the trust's mandatory termination
date. The actual amounts that you receive or actual losses that you experience
may vary from these estimates with changes in expenses or a change in the
proportional relationship of the FLEX Options based on the number of FLEX
Option contracts. The table and examples below are provided for illustrative
purposes only and are hypothetical. The table and examples do not purport to be
representative of every possible scenario concerning the Reference Asset. No
one can predict the performance of the Reference Asset. The assumptions made in
connection with the table and examples may not reflect actual events. You
should not take this information as an indication or assurance of the expected
performance of the Reference Asset, the FLEX Options or the return on the trust
units. The actual overall performance of the trust will vary with fluctuations
in the value of the FLEX Options during the trust's life, changes in trust
expenses and liquidations of FLEX Options during the trust's life, among other
things.
Hypothetical Examples
------------------------------------------------------------------------------------------------------
Hypothetical Hypothetical
RA Price Hypothetical Option Proceeds (per Unit) Returns
------------------------------------------------------------------------------------------------------
Standard
Account Fee
ITM ATM OTM OTM Hypothetical Initial Account
Reference Purchased Purchased Written Written Total Initial Unit Initial Unit
Percentage Asset Call Put Call Put Amount NAV Price Price
Change Price Options Options Options Options for Trust ($10.0000) ($10.____) ($10.____)
------------------------------------------------------------------------------------------------------
100.00%
90.00%
80.00%
70.00%
60.00%
50.00%
40.00%
30.00%
25.00%
20.00%
17.00%
15.00%
10.00%
5.00%
0.00%
-5.00%
-10.00%
-15.00%
-20.00%
-25.00%
-30.00%
-40.00%
-50.00%
-60.00%
-70.00%
-80.00%
-90.00%
-100.00%
The following examples illustrate how payments are designed to operate in
different hypothetical scenarios.
Example--The RA Price at the close of the New York Stock Exchange on the
Option Expiration Date is $____ (125% of the Initial RA Value--an increase of
25%).
Using this set of facts, the total hypothetical amount per unit over the
trust's life is approximately $____, consisting of the following intended
amounts:
o the trust receiving $____ per unit on the ITM Purchased Call Options;
o the trust paying $____ per unit on the OTM Written Call Options; and
o no amounts being paid on the OTM Written Put Options or ATM Purchased
Put Options (i.e. expiring worthless).
Example--The RA Price at the close of the New York Stock Exchange on the
Option Expiration Date is $____ (105% of the Initial RA Value--an increase of
5%).
Using this set of facts, the total hypothetical amount per unit over the
trust's life is approximately $____, consisting of the following intended
amounts:
o the trust receiving $____ per unit on the ITM Purchased Call Options;
and
o no amounts being paid on the OTM Written Call Options, OTM Written Put
Options or ATM Purchased Put Options (i.e. expiring worthless).
Example--The RA Price at the close of the New York Stock Exchange on the
Option Expiration Date is $____ (100% of the Initial RA Value--no change).
Using this set of facts, the total hypothetical amount per unit over the
trust's life is approximately $10.00, consisting of the following intended
amounts:
o the trust receiving a payment of $10.00 per unit on the ITM Purchased
Call Options; and
o no payments being made on the OTM Written Call Options, the OTM
Written Put Options or the ATM Purchased Put Options (i.e. expiring
worthless)
Example--The RA Price at the close of the New York Stock Exchange on the
Option Expiration Date is $____ (95% of the Initial RA Value--a decrease of
5%).
Using this set of facts, the total hypothetical amount per unit over the
trust's life is approximately $10.00, consisting of the following intended
amounts:
o the trust receiving $____ per unit on the ITM Purchased Call Options;
o the trust receiving $____ per unit on the ATM Purchased Put Options;
and
o no amounts being paid on the OTM Written Call Options or the OTM
Written Put Options (i.e. expiring worthless).
Example--The RA Price at the close of the New York Stock Exchange on the
Option Expiration Date is $____ (75% of the Initial RA Value--a decrease of
25%).
Using this set of facts, the total hypothetical amount per unit over the
trust's life is approximately $____, consisting of the following intended
amounts:
o the trust receiving $____ per unit on the ITM Purchased Call Options;
o the trust paying $____ per unit on the OTM Written Put Options;
o the trust receiving $____ per unit on the ATM Purchased Put Options;
o no amounts being paid on the OTM Written Call Options (i.e. expiring
worthless).
GUGGENHEIM DEFINED PORTFOLIOS
GUGGENHEIM PORTFOLIO PROSPECTUS
PART B DATED ___________, 2020
The prospectus for a Guggenheim Defined Portfolio (a "trust") is divided
into two parts. Part A of the prospectus relates exclusively to a particular
trust or trusts and provides specific information regarding each trust's
portfolio, strategies, investment objectives, expenses, financial highlights,
income and capital distributions, hypothetical performance information, risk
factors and optional features. Part B of the prospectus provides more general
information regarding the Guggenheim Defined Portfolios. You should read both
parts of the prospectus and retain them for future reference. Except as provided
in Part A of the prospectus, the information contained in this Part B will apply
to each trust.
Contents
General Information 2
Investment Policies 2
Risk Factors 3
Administration of the Trust 7
Expenses of the Trust 12
Portfolio Transactions and Brokerage Allocation 14
Purchase, Redemption and Pricing of Units 14
Taxes 18
Experts 21
General Information
Each trust is one of a series of separate unit investment trusts created
under the name Guggenheim Defined Portfolios and registered under the
Investment Company Act of 1940 and the Securities Act of 1933. Each trust was
created as a common law trust on the inception date described in the prospectus
under the laws of the state of New York. Each trust was created under a trust
agreement among Guggenheim Funds Distributors, LLC (as sponsor, evaluator and
supervisor) and The Bank of New York Mellon (as trustee).
When your trust was created, the sponsor delivered to the trustee
securities or contracts for the purchase thereof for deposit in the trust and
the trustee delivered to the sponsor documentation evidencing the ownership of
units of the trust. After your trust is created, the sponsor may deposit
additional securities in the trust, contracts to purchase additional securities
along with cash (or a bank letter of credit in lieu of cash) to pay for such
contracted securities or cash (including a letter of credit) with instructions
to purchase additional securities. Such additional deposits will be in amounts
which will seek to replicate, as closely as practicable, the portfolio
immediately prior to such deposits. If the sponsor deposits cash, existing and
new investors may experience a dilution of their investments and a reduction in
their anticipated income because of fluctuations in the prices of the
securities between the time of the cash deposit and the purchase of the
securities and because the trust will pay the associated brokerage fees.
A trust consists of (i) the securities listed under "Trust Portfolio" in
the prospectus as may continue to be held from time to time in the trust; (ii)
any additional securities acquired and held by the trust pursuant to the
provisions of the trust agreement; and (iii) any cash held in the accounts of
the trust. Neither the sponsor nor the trustee shall be liable in any way for
any failure in any of the securities. However, should any contract for the
purchase of any of the securities initially deposited in a trust fail, the
sponsor will, unless substantially all of the moneys held in the trust to cover
such purchase are reinvested in substitute securities in accordance with the
trust agreement, refund the cash and sales charge attributable to such failed
contract to all unitholders on the next distribution date.
Investment Policies
The trust is a unit investment trust and is not an "actively managed"
fund. Traditional methods of investment management for a managed fund typically
involve frequent changes in a portfolio of securities on the basis of economic,
financial and market analysis. The portfolio of a trust, however, will not be
actively managed and therefore the adverse financial condition of an issuer
will not necessarily require the sale of its securities from a portfolio.
Unitholders will not be able to dispose of or vote any of the securities
in a trust. As the holder of the securities, the trustee will vote the
securities and will endeavor to vote the securities such that the securities
are voted as closely as possible in the same manner and the same general
proportion as are the securities held by owners other than such trust. However,
the trustee may not be able to vote the securities in a trust that are traded
on foreign exchanges.
The trust agreement provides that the sponsor may (but need not) direct
the trustee to dispose of a security in certain events such as the issuer
having defaulted on the payment on any of its outstanding obligations, the
issuer having qualified as a passive foreign investment company under the
Internal Revenue Code or the price of a 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 securities would be detrimental to the trust. If a public
tender offer has been made for a security or a merger or acquisition has been
announced affecting a security, the trustee may either sell the security or
accept a tender offer for cash if the supervisor determines that the sale or
tender is in the best interest of unitholders. The trustee will distribute any
cash proceeds to unitholders. Pursuant to the trust agreement and with limited
exceptions, the trustee may sell any securities or other properties acquired in
exchange for securities such as those acquired in connection with a merger or
other transaction. If offered such new or exchanged securities or property
other than cash, the trustee shall reject the offer. However, in the event such
securities or property are nonetheless acquired by the 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. Proceeds from the sale of
securities (or any securities or other property received by the trust in
exchange for securities) are credited to the Capital Account for distribution
to unitholders or to meet redemptions.
Except as stated in the trust agreement, or in the prospectus, the
acquisition by the trust of any securities other than the portfolio securities
is prohibited. The trustee may sell securities, designated by the sponsor, from
the trust for the purpose of redeeming units of a trust tendered for redemption
and the payment of expenses and for such other purposes as permitted under the
trust agreement.
Notwithstanding the foregoing, the trustee is authorized to reinvest any
funds held in the Capital or Income Accounts, pending distribution, in U.S.
Treasury obligations which mature on or before the next applicable distribution
date. Any obligations so acquired must be held until they mature and proceeds
therefrom may not be reinvested.
Proceeds from the sale of securities (or any securities or other property
received by a trust in exchange for securities) are credited to the Capital
Account of a trust for distribution to unitholders or to meet redemptions.
Except for failed securities and as provided in the prospectus or in the trust
agreement, the acquisition by a trust of any securities other than the
portfolio securities is prohibited. The trustee may sell securities from a
trust for limited purposes, including redeeming units tendered for redemption
and the payment of expenses.
Risk Factors
Stocks. An investment in units of a trust should be made with an
understanding of the risks inherent in an investment in equity securities,
including the risk that the financial condition of issuers of the securities
may become impaired or that the general condition of the stock market may
worsen (both of which may contribute directly to a decrease in the value of the
securities and thus, in the value of the units) or the risk that holders of
common stock have a right to receive payments from the issuers of those stocks
that is generally inferior to that of creditors of, or holders of debt
obligations issued by, the issuers and that the rights of holders of common
stock generally rank inferior to the rights of holders of preferred stock. You
could lose some or all of your investment in the trust. Common stocks are
especially susceptible to general stock market movements and to volatile
increases and decreases in value as market confidence in and perceptions of the
issuers change. These perceptions are based on unpredictable factors including
expectations regarding government, economic, monetary and fiscal policies,
inflation and interest rates, economic expansion or contraction, and global or
regional political, economic or banking crises.
Holders of common stock incur more risk than the holders of preferred
stocks and debt obligations because common stockholders, as owners of the
entity, have generally inferior rights to receive payments from the issuer in
comparison with the rights of creditors of, or holders of debt obligations or
preferred stock issued by the issuer. Holders of common stock of the type held
by 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 to participate in
amounts available for distribution by the issuer only after all other claims on
the issuer have been paid or provided for. By contrast, holders of preferred
stock have the right to receive dividends at a fixed rate when and as declared
by the issuer's board of directors, normally on a cumulative basis, but do not
participate in other amounts available for distribution by the issuing
corporation. Cumulative preferred stock dividends must be paid before common
stock dividends and any cumulative preferred stock dividend omitted is added to
future dividends payable to the holders of cumulative preferred stock.
Preferred stocks are also entitled to rights on liquidation which are senior to
those of common stocks. Moreover, common stocks do not represent an obligation
of the issuer and therefore do not offer any assurance of income or provide the
degree of protection of capital debt securities. Indeed, the issuance of debt
securities or even preferred stock will create prior claims for payment of
principal, interest, liquidation preferences and dividends which could
adversely affect the ability and inclination of the issuer to declare or pay
dividends on its common stock or the rights of holders of common stock with
respect to assets of the issuer upon liquidation or bankruptcy. Further, unlike
debt securities which typically have a stated principal amount payable at
maturity (whose value, however, will be subject to market fluctuations prior
thereto), common stocks have neither a fixed principal amount nor a maturity
and have values which are subject to market fluctuations for as long as the
stocks remain outstanding. The value of the securities in a portfolio thus may
be expected to fluctuate over the entire life of a trust to values higher or
lower than those prevailing at the time of purchase.
The sponsor's buying and selling of the securities, especially during the
initial offering of units of the trust or to satisfy redemptions of units may
impact upon the value of the underlying securities and the units. The
publication of the list of the securities selected for the trust may also cause
increased buying activity in certain of the stocks comprising the portfolio.
After such announcement, investment advisory and brokerage clients of the
sponsor and its affiliates may purchase individual securities appearing on the
list during the course of the initial offering period or may purchase warrants
issued by the sponsor or its affiliates which are based on the performance of
the securities on the list. The sponsor or its affiliates may also purchase
securities as a hedge against its risk on the warrants (although generally the
sponsor and its affiliates will not purchase securities for their own account
until after the trust portfolio has been acquired). Such buying activity in the
stock of these companies or issuance of the warrants prior to the purchase of
the securities by the trust may cause the trust to purchase stocks at a higher
price than those buyers who effect purchases by the trust.
Fixed Portfolio. Investors should be aware that the trust is not "managed"
and as a result, the adverse financial condition of a company will not result
in the elimination of its securities from the portfolio of the trust except
under extraordinary circumstances. Investors should note in particular that the
securities were selected on the basis of the criteria set forth in the
prospectus and that the trust may continue to purchase or hold securities
originally selected through this process even though the evaluation of the
attractiveness of the securities may have changed. A number of the securities
in the trust may also be owned by other clients of the sponsor. However,
because these clients may have differing investment objectives, the sponsor may
sell certain securities from those accounts in instances where a sale by the
trust would be impermissible, such as to maximize return by taking advantage of
market fluctuations. In the event a public tender offer is made for a security
or a merger or acquisition is announced affecting a security, the sponsor may
instruct the trustee to tender or sell the security on the open market when, in
its opinion, it is in the best interest of the unitholders of the unit to do
so. Although the portfolio is regularly reviewed and evaluated and the sponsor
may instruct the trustee to sell securities under certain limited
circumstances, securities will not be sold by the trust to take advantage of
market fluctuations or changes in anticipated rates of appreciation. As a
result, the amount realized upon the sale of the securities may not be the
highest price attained by an individual security during the life of the trust.
The prices of single shares of each of the securities in the trust vary widely,
and the effect of a dollar of fluctuation, either higher or lower, in stock
prices will be much greater as a percentage of the lower-price stocks' purchase
price than as a percentage of the higher-price stocks' purchase price.
Options Risks. The value of the FLEX Options will be affected by changes
in the price of the Reference Asset, the value of the Index and its underlying
securities, changes in interest rates, changes in the actual and perceived
volatility of the stock market and the Reference Asset, Index and the
underlying securities and the remaining time to the Option Expiration Date. The
value of the FLEX Options does not increase and decrease at the same rate as
the price of shares of the Reference Asset (although they generally move in the
same direction). However, as a FLEX Option approaches its expiration date, its
value increasingly moves with the value of the Index. The value of the Written
Call Options reduces the value of your units. The Written Call Options create
an obligation to potentially make a payment in contrast to the Purchased
Options, which creates an obligation to potentially receive a payment. As the
value of the Written Call Options contracts increase, it has a negative impact
on the value of your units.
When the trust buys option contracts, the value of your units increases,
but if the value of these options contracts decreases, it has a negative impact
on the value of your units. The trust may experience substantial downside from
specific option contracts positions, and certain option contract positions may
expire worthless.
Exchange-Traded Fund Risks. If set forth in Part A of the prospectus, a
trust may invest in options that entitle the trust to purchase or sell shares
of an exchange-traded fund ("ETF"). ETFs are investment pools that hold other
securities. ETFs are either open-end management investment companies or unit
investment trusts registered under the Investment Company Act of 1940. Unlike
typical open-end funds or unit investment trusts, ETFs generally do not sell or
redeem their individual shares at net asset value. In addition, securities
exchanges list ETF shares for trading, which allows investors to purchase and
sell individual ETF shares at current market prices throughout the day. ETFs
therefore possess characteristics of traditional open-end funds and unit
investment trusts, which issue redeemable shares, and of corporate common
stocks or closed-end funds, which generally issue shares that trade at
negotiated prices on securities exchanges and are not redeemable. ETFs are
subject to various risks, including management's ability to meet the fund's
investment objective. The underlying ETF has management and operating expenses.
Shares of ETFs may trade at a discount from their net asset value in the
secondary market. This risk is separate and distinct from the risk that the net
asset value of the ETF shares may decrease. The amount of such discount from
net asset value is subject to change from time to time in response to various
factors.
Market Discounts or Premiums. Certain of the securities may have been
deposited at a market discount or premium principally because their dividend
rates are lower or higher than prevailing rates on comparable securities. The
current returns of market discount securities are lower than comparably rated
securities selling at par because discount securities tend to increase in
market value as they approach maturity. The current returns of market premium
securities are higher than comparably rated securities selling at par because
premium securities tend to decrease in market value as they approach maturity.
Because part of the purchase price is returned through current income payments
and not at maturity, an early redemption at par of a premium security will
result in a reduction in yield to the trust. Market premium or discount
attributable to dividend rate changes does not indicate market confidence or
lack of confidence in the issue.
Liquidity. Whether or not the securities are listed on a national
securities exchange, the principal trading market for the securities may be in
the over-the-counter market. As a result, the existence of a liquid trading
market for the securities may depend on whether dealers will make a market in
the securities. There can be no assurance that a market will be made for any of
the securities, that any market for the securities will be maintained or of the
liquidity of the securities in any markets made. In addition, a trust is
restricted under the Investment Company Act of 1940 from selling securities to
the sponsor. The price at which the securities may be sold to meet redemptions
and the value of a trust will be adversely affected if trading markets for the
securities are limited or absent.
Additional Deposits. The trust agreement authorizes the sponsor to
increase the size of a trust and the number of units thereof by the deposit of
additional securities, or cash (including a letter of credit) with instructions
to purchase additional securities, in such trust and the issuance of a
corresponding number of additional units. If the sponsor deposits cash,
existing and new investors may experience a dilution of their investments and a
reduction in their anticipated income because of fluctuations in the prices of
the securities between the time of the cash deposit and the purchase of the
securities and because a trust will pay the associated brokerage fees. To
minimize this effect, the trusts will attempt to purchase the securities as
close to the evaluation time or as close to the evaluation prices as possible.
Some of the securities may have limited trading volume. The trustee, with
directions from the sponsor, will endeavor to purchase securities with
deposited cash as soon as practicable reserving the right to purchase those
securities over the 20 business days following each deposit in an effort to
reduce the effect of these purchases on the market price of those stocks. This
could, however, result in the trusts' failure to participate in any
appreciation of those stocks before the cash is invested. If any cash remains
at the end of this period (and such date is within the 90-day period following
the inception date) and cannot be invested in one or more stocks, at what the
sponsor considers reasonable prices, it intends to use that cash to purchase
each of the other securities in the original proportionate relationship among
those securities. Similarly, at termination of the trust, the sponsor reserves
the right to sell securities over a period of up to nine business days to
lessen the impact of its sales on the market price of the securities. The
proceeds received by unitholders following termination of the trust will
reflect the actual sales proceeds received on the securities, which will likely
differ from the closing sale price on the termination date.
Litigation and Legislation. At any time litigation may be initiated on a
variety of grounds, or legislation may be enacted with respect to the
securities in a trust or the issuers of the securities. There can be no
assurance that future litigation or legislation will not have a material
adverse effect on the trust or will not impair the ability of issuers to
achieve their business goals.
Administration of the Trust
Distributions to Unitholders. Income received by a trust is credited by
the trustee to the Income Account of the trust. Other receipts are credited to
the Capital Account of a trust. Income received by a trust will be distributed
on or shortly after the distribution dates each year shown in the prospectus on
a pro rata basis to unitholders of record as of the preceding record date shown
in the prospectus. However, if set forth in Part A of the prospectus that the
trust will prorate distributions on an annual basis ("Income Averaging"), then
income received by the trust will be distributed on a prorated basis of
one-twelfth of the estimated annual income to the trust for the ensuing 12
months. All distributions will be net of applicable expenses. There is no
assurance that any actual distributions will be made since all dividends
received may be used to pay expenses. In addition, excess amounts from the
Capital Account of a trust, if any, will be distributed at least annually to
the unitholders then of record. Proceeds received from the disposition of any
of the securities after a record date and prior to the following distribution
date will be held in the Capital Account and not distributed until the next
distribution date applicable to the Capital Account. The trustee shall be
required to make a distribution from the Capital Account if the cash balance on
deposit therein available for distribution shall be sufficient to distribute at
least $1.00 per 100 units. The trustee is not required to pay interest on funds
held in the Capital or Income Accounts (but may itself earn interest thereon
and therefore benefits from the use of such funds). The trustee is authorized
to reinvest any funds held in the Capital or Income Accounts, pending
distribution, in U.S. Treasury obligations which mature on or before the next
applicable distribution date. Any obligations so acquired must be held until
they mature and proceeds therefrom may not be reinvested.
The distribution to the unitholders as of each record date will be made on
the following distribution date or shortly thereafter and shall consist of an
amount substantially equal to such portion of the unitholders' pro rata share
of the dividend distributions then held in the Income Account after deducting
estimated expenses. Because dividends are not received by a trust at a constant
rate throughout the year, such distributions to unitholders are expected to
fluctuate. However, if the trust uses Income Averaging, the trust prorates the
income distribution on an annual basis and annual income distributions are
expected to vary from year to year. If the amount on deposit in the Income
Account is insufficient for payment of the amount of income to be distributed
on a monthly basis, the trustee shall advance out of its own funds and cause to
be deposited in and credited to such Income Account such amount as may be
required to permit payment of the monthly income distribution. The trustee
shall be entitled to be reimbursed by the trust, without interest, out of
income received by the trust subsequent to the date of such advance and subject
to the condition that any such reimbursement shall be made only if it will not
reduce the funds in or available for the Income Account to an amount less than
required for the next ensuing distribution. Persons who purchase units will
commence receiving distributions only after such person becomes a record owner.
A person will become the owner of units, and thereby a unitholder of record, on
the date of settlement provided payment has been received. Notification to the
trustee of the transfer of units is the responsibility of the purchaser, but in
the normal course of business such notice is provided by the selling
broker-dealer.
The trustee will periodically deduct from the Income Account of a trust
and, to the extent funds are not sufficient therein, from the Capital Account
of a trust amounts necessary to pay the expenses of a trust. The trustee also
may withdraw from said accounts such amounts, if any, as it deems necessary to
establish a reserve for any governmental charges payable out of a trust.
Amounts so withdrawn shall not be considered a part of a trust's assets until
such time as the trustee shall return all or any part of such amounts to the
appropriate accounts. In addition, the trustee may withdraw from the Income and
Capital Accounts of a trust such amounts as may be necessary to cover
redemptions of units.
Statements to Unitholders. With each distribution, the trustee will
furnish to each registered holder a statement of the amount of income and the
amount of other receipts, if any, which are being distributed, expressed in
each case as a dollar amount per unit.
The accounts of a trust will not be audited annually unless the sponsor
determines that such an audit would be in the best interest of the unitholders
of the trust. If an audit is conducted, it will be done at the related trust's
expense, by independent public accountants designated by the sponsor. The
accountants' report will be furnished by the trustee to any unitholder upon
written request. Within a reasonable period of time after the end of each
calendar year, the trustee shall furnish to each person who at any time during
the calendar year was a unitholder of a trust a statement, covering the
calendar year, generally setting forth for the trust:
(A) As to the Income Account:
(1) Income received;
(2) Deductions for applicable taxes and for fees and expenses of the trust
and for redemptions of units, if any; and
(3) The balance remaining after such distributions and deductions,
expressed in each case both as a total dollar amount and as a dollar
amount representing the pro rata share of each unit outstanding on the
last business day of such calendar year; and
(B) As to the Capital Account:
(1) The dates of disposition of any securities and the net proceeds
received therefrom;
(2) Deductions for payment of applicable taxes and fees and expenses of
the trust; and
(3) The balance remaining after such distributions and deductions
expressed both as a total dollar amount and as a dollar amount
representing the pro rata share of each unit outstanding on the last
business day of such calendar year; and
(C) The following information:
(1) A list of the securities as of the last business day of such calendar
year;
(2) The number of units outstanding on the last business day of such
calendar year;
(3) The redemption price based on the last evaluation made during such
calendar year; and
(4) The amount actually distributed during such calendar year from the
Income and Capital Accounts separately stated, expressed both as total
dollar amounts and as dollar amounts per unit outstanding on the
record dates for each such distribution.
Rights of Unitholders. A unitholder may at any time tender units to the
trustee for redemption. The death or incapacity of any unitholder will not
operate to terminate a trust nor entitle legal representatives or heirs to
claim an accounting or to bring any action or proceeding in any court for
partition or winding up of a trust. No unitholder shall have the right to
control the operation and management of a trust in any manner, except to vote
with respect to the amendment of the trust agreement or termination of a
trust.
Amendment and Termination. The trust agreement may be amended by the
trustee and the sponsor without the consent of any of the unitholders: (i) to
cure any ambiguity or to correct or supplement any provision which may be
defective or inconsistent; (ii) to change any provision thereof as may be
required by the Securities and Exchange Commission or any successor
governmental agency; (iii) to make such provisions as shall not materially
adversely affect the interests of the unitholders; or (iv) to make such other
amendments as may be necessary for a trust to qualify as a regulated investment
company, in the case of a trust which has elected to qualify as such. The trust
agreement with respect to any trust may also be amended in any respect by the
sponsor and the trustee, or any of the provisions thereof may be waived, with
the consent of the holders of units representing 66 2/3% of the units then
outstanding of the trust, provided that no such amendment or waiver will reduce
the interest of any unitholder thereof without the consent of such unitholder
or reduce the percentage of units required to consent to any such amendment or
waiver without the consent of all unitholders of the trust. In no event shall
the trust agreement be amended to increase the number of units of a trust
issuable thereunder, to permit the acquisition of any securities in addition to
or in substitution for those initially deposited in the trust or to adversely
affect the characterization of a trust as a regulated investment company for
federal income tax purposes, except in accordance with the provisions of the
trust agreement. The trustee shall promptly notify unitholders of the substance
of any such amendment.
The trust agreement provides that a trust shall terminate upon the
liquidation, redemption or other disposition of the last of the securities held
in the trust but in no event is it to continue beyond the mandatory termination
date set forth in Part A of the prospectus. If the value of a trust shall be
less than the applicable minimum value stated in the prospectus, the trustee
may, in its discretion, and shall, when so directed by the sponsor, terminate
the trust. A trust may be terminated at any time by the holders of units
representing 66 2/3% of the units thereof then outstanding. In addition, the
sponsor may terminate a trust if it is based on a security index and the index
is no longer maintained.
Beginning nine business days prior to, but no later than, the mandatory
termination date described in the prospectus, the trustee may begin to sell all
of the remaining underlying securities on behalf of unitholders in connection
with the termination of the trust. The sponsor may assist the trustee in these
sales and receive compensation to the extent permitted by applicable law. The
sale proceeds will be net of any incidental expenses involved in the sales.
The trustee will attempt to sell the securities as quickly as it can
during the termination proceedings without, in its judgment, materially
adversely affecting the market price of the securities, but it is expected that
all of the securities will in any event be disposed of within a reasonable time
after a trust's termination. The sponsor does not anticipate that the period
will be longer than one month, and it could be as short as one day, depending
on the liquidity of the securities being sold. The liquidity of any security
depends on the daily trading volume of the security and the amount that the
sponsor has available for sale on any particular day. Of course, no assurances
can be given that the market value of the securities will not be adversely
affected during the termination proceedings.
Within a reasonable period after termination, the trustee will sell any
securities remaining in a trust and, after paying all expenses and charges
incurred by the trust, will distribute to unitholders thereof their pro rata
share of the balances remaining in the Income and Capital Accounts of the
trust.
The sponsor currently intends, but is not obligated, to offer for sale
units of a subsequent series of certain trusts at approximately one year after
the inception date of such trusts. If the sponsor does offer such units for
sale, unitholders may be given the opportunity to purchase such units at a
public offering price. There is, however, no assurance that units of any new
series of a trust will be offered for sale at that time, or if offered, that
there will be sufficient units available for sale to meet the requests of any
or all unitholders.
The Trustee. The trustee is The Bank of New York Mellon, a trust company
organized under the laws of New York. The Bank of New York Mellon has its Unit
Investment Trust Division offices at 2 Hanson Place, 12th Fl., Brooklyn, New
York 11217, telephone 1-800-701-8178. The Bank of New York Mellon is subject to
supervision and examination by the Superintendent of Banks of the State of New
York and the Board of Governors of the Federal Reserve System, and its deposits
are insured by the Federal Deposit Insurance Corporation to the extent
permitted by law.
The trustee, whose duties are ministerial in nature, has not participated
in selecting the portfolio of any trust. In accordance with the trust
agreement, the trustee shall keep records of all transactions at its office.
Such records shall include the name and address of, and the number of units
held by, every unitholder of a trust. Such books and records shall be open to
inspection by any unitholder at all reasonable times during usual business
hours. The trustee shall make such annual or other reports as may from time to
time be required under any applicable state or federal statute, rule or
regulation. The trustee shall keep a certified copy or duplicate original of
the trust agreement on file in its office available for inspection at all
reasonable times during usual business hours by any unitholder, together with a
current list of the securities held in each trust. Pursuant to the trust
agreement, the trustee may employ one or more agents for the purpose of custody
and safeguarding of securities comprising a trust.
Under the trust agreement, the trustee or any successor trustee may resign
and be discharged of a trust created by the trust agreement by executing an
instrument in writing and filing the same with the sponsor. The trustee or
successor trustee must mail a copy of the notice of resignation to all
unitholders then of record, not less than sixty days before the date specified
in such notice when such resignation is to take effect. The sponsor upon
receiving notice of such resignation is obligated to appoint a successor
trustee promptly. If, upon such resignation, no successor trustee has been
appointed and has accepted the appointment within thirty days after
notification, the retiring trustee may apply to a court of competent
jurisdiction for the appointment of a successor. The sponsor may at any time
remove the trustee, with or without cause, and appoint a successor trustee as
provided in the trust agreement. Notice of such removal and appointment shall
be mailed to each unitholder by the sponsor. Upon execution of a written
acceptance of such appointment by such successor trustee, all the rights,
powers, duties and obligations of the original trustee shall vest in the
successor. The trustee must be a corporation organized under the laws of the
United States, or any state thereof, be authorized under such laws to exercise
trust powers and have at all times an aggregate capital, surplus and undivided
profits of not less than $5,000,000.
The Sponsor. Guggenheim Funds Distributors, LLC specializes in the
creation, development and distribution of investment solutions for advisors and
their valued clients. Guggenheim Funds Distributors, LLC was created as Ranson
& Associates, Inc. in 1995 and is the successor sponsor to unit investment
trusts formerly sponsored by EVEREN Unit Investment Trusts, a service of EVEREN
Securities, Inc. Guggenheim Funds Distributors, LLC is also the sponsor and
successor sponsor of Series of Ranson Unit Investment Trusts and The Kansas
Tax-Exempt Trust and Multi-State Series of The Ranson Municipal Trust. On
October 29, 2001, Ranson & Associates, Inc. was acquired by Claymore Group LLC.
The sale to Claymore Group LLC was financed by a loan from The Bank of New York
Mellon, the trustee. In November 2001, the sponsor changed its name from Ranson
& Associates, Inc. to Claymore Securities, Inc. On October 14, 2009, Guggenheim
Partners, LLC acquired Claymore Securities, Inc. Since the finalization of the
acquisition, Claymore Securities, Inc. has been operating as a subsidiary of
Guggenheim Partners, LLC. On September 27, 2010, Claymore Securities, Inc.
officially changed its name to Guggenheim Funds Distributors, LLC.
Guggenheim Funds Distributors, LLC has been active in public and corporate
finance, has underwritten closed-end funds and has sold bonds, mutual funds,
closed-end funds, exchange-traded funds, structured products and unit
investment trusts and maintained secondary market activities relating thereto.
At present, Guggenheim Funds Distributors, LLC which is a member of the
Financial Industry Regulatory Authority (FINRA), is the sponsor to each of the
above-named unit investment trusts. The sponsor's office is located at 227 W.
Monroe Street, Chicago, Illinois 60606.
If at any time the sponsor shall fail to perform any of its duties under
the trust agreement or shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or shall have its affairs taken over by public
authorities, then the trustee may (i) appoint a successor sponsor at rates of
compensation deemed by the trustee to be reasonable and not exceeding such
reasonable amounts as may be prescribed by the Securities and Exchange
Commission; (ii) terminate the trust agreement and liquidate any trust as
provided therein; or (iii) continue to act as trustee without terminating the
trust agreement.
The Supervisor and the Evaluator. Guggenheim Funds Distributors, LLC, the
sponsor, also serves as evaluator and supervisor. The evaluator and supervisor
may resign or be removed by the trustee in which event the trustee is to use
its best efforts to appoint a satisfactory successor. Such resignation or
removal shall become effective upon acceptance of appointment by the successor
evaluator. If upon resignation of the evaluator no successor has accepted
appointment within thirty days after notice of resignation, the evaluator may
apply to a court of competent jurisdiction for the appointment of a successor.
Notice of such registration or removal and appointment shall be mailed by the
trustee to each unitholder. As evaluator, Guggenheim Funds Distributors, LLC
utilizes the trustee to perform certain evaluation services.
Limitations on Liability. The sponsor is liable for the performance of its
obligations arising from its responsibilities under the trust agreement, but
will be under no liability to the unitholders for taking any action or
refraining from any action in good faith pursuant to the trust agreement or for
errors in judgment, except in cases of its own gross negligence, bad faith or
willful misconduct or its reckless disregard for its duties thereunder. The
sponsor shall not be liable or responsible in any way for depreciation or loss
incurred by reason of the sale of any securities.
The trust agreement provides that the trustee shall be under no liability
for any action taken in good faith in reliance upon prima facie properly
executed documents or for the disposition of moneys, securities or certificates
except by reason of its own gross negligence, bad faith or willful misconduct,
or its reckless disregard for its duties under the trust agreement, nor shall
the trustee be liable or responsible in any way for depreciation or loss
incurred by reason of the sale by the trustee of any securities. In the event
that the sponsor shall fail to act, the trustee may act and shall not be liable
for any such action taken by it in good faith. The trustee shall not be
personally liable for any taxes or other governmental charges imposed upon or
in respect of the securities or upon the interest thereof. In addition, the
trust agreement contains other customary provisions limiting the liability of
the trustee.
The unitholders may rely on any evaluation furnished by the evaluator and
shall have no responsibility for the accuracy thereof. The trust agreement
provides that the determinations made by the evaluator shall be made in good
faith upon the basis of the best information available to it, provided,
however, that the evaluator shall be under no liability to the trustee or
unitholders for errors in judgment, but shall be liable for its gross
negligence, bad faith or willful misconduct or its reckless disregard for its
obligations under the trust agreement.
Expenses of the Trust
The sponsor does not charge a trust an annual advisory fee. The sponsor
will receive a portion of the sale commissions paid in connection with the
purchase of units and will share in profits, if any, related to the deposit of
securities in the trust. The sponsor and/or its affiliates do, also, receive an
annual fee as set forth in Part A of the prospectus for maintaining
surveillance over the portfolio and for performing certain administrative
services for the trust (the "Sponsor's Supervisory Fee"). In providing such
supervisory services, the sponsor may purchase research from a variety of
sources, which may include dealers of the trusts. If so provided in Part A of
the prospectus, the sponsor may also receive an annual fee for providing
bookkeeping and administrative services for a trust (the "Bookkeeping and
Administrative Fee"). Such services may include, but are not limited to, the
preparation of various materials for unitholders and providing account
information to the unitholders. If so provided in Part A of the prospectus, the
evaluator may also receive an annual fee for performing evaluation services for
the trusts (the "Evaluator's Fee"). In addition, if so provided in Part A of
the prospectus, a trust may be charged an annual licensing fee to cover
licenses for the use of service marks, trademarks, trade names and intellectual
property rights and/or for the use of databases and research. The trust will
bear all operating expenses. Estimated annual trust operating expenses are as
set forth in Part A of the prospectus; if actual expenses are higher than the
estimate, the excess will be borne by the trust. The estimated expenses include
listing fees but do not include the brokerage commissions and other
transactional fees payable by the trust in purchasing and selling securities.
The trustee receives for its services that fee set forth in Part A of the
prospectus. The trustee's fee, which is paid monthly, is based on the largest
number of units of a trust outstanding at any time during the primary offering
period. After the primary offering period, the fee shall accrue daily and be
based on the number of units outstanding on the first business day of each
calendar year in which the fee is calculated or the number of units outstanding
at the end of the primary offering period, as appropriate. The Sponsor's
Supervisory Fee, the Bookkeeping and Administrative Fee and the Evaluator's Fee
are paid monthly and are based on the largest number of units of a trust
outstanding at any time during the primary offering period. After the primary
offering period, these fees shall accrue daily and be based on the number of
units outstanding on the first business day of each calendar year in which a
fee is calculated or the number of units outstanding at the end of the primary
offering period, as appropriate. The trustee benefits to the extent there are
funds for future distributions, payment of expenses and redemptions in the
Capital and Income Accounts since these Accounts are non-interest bearing and
the amounts earned by the trustee are retained by the trustee. Part of the
trustee's compensation for its services to a trust is expected to result from
the use of these funds. In addition, the Sponsor's Supervisory Fee, Bookkeeping
and Administrative Fee, Evaluator's Fee and the Trustee's Fee may be adjusted
in accordance with the cumulative percentage increase of the United States
Department of Labor's Consumer Price Index entitled "All Services Less Rent"
since the establishment of the trust. In addition, with respect to any fees
payable to the sponsor or an affiliate of the sponsor for providing bookkeeping
and other administrative services, supervisory 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, in the aggregate, rendered to all unit investment trusts of which
Guggenheim Funds Distributors, LLC is the sponsor in any calendar year exceed
the actual cost to the sponsor or its affiliates of supplying such services, in
the aggregate, in such year. In addition, the trustee may reimburse the sponsor
out of its own assets for services performed by employees of the sponsor in
connection with the operation of your trust.
The trust will also pay a fee to the sponsor for creating and developing
the trust, including determining the trust's objective, policies, composition
and size, selecting service providers and information services, and for
providing other similar administrative and ministerial functions. Your trust
pays this "creation and development fee" as a fixed dollar amount at the close
of the initial offering period. The sponsor does not use the fee to pay
distribution expenses or as compensation for sales efforts.
The following additional charges are or may be incurred by the trust: (i)
fees for the trustee's extraordinary services; (ii) expenses of the trustee
(including legal and auditing expenses, but not including any fees and expenses
charged by an agent for custody and safeguarding of securities) and of counsel,
if any; (iii) various governmental charges; (iv) expenses and costs of any
action taken by the trustee to protect the trust or the rights and interests of
the unitholders; (v) indemnification of the trustee for any loss, liability or
expense incurred by it in the administration of the trust not resulting from
gross negligence, bad faith or willful misconduct on its part; (vi)
indemnification of the sponsor for any loss, liability or expense incurred in
acting in that capacity without gross negligence, bad faith or willful
malfeasance or its reckless disregard for its obligations under the trust
agreement; (vii) any offering costs incurred after the end of the initial
offering period; (viii) expenditures incurred in contacting unitholders upon
termination of the trust and (ix) custodial fees.. The fees and expenses set
forth herein are payable out of a trust and, when owing to the trustee, are
secured by a lien on the trust. Since the securities are all stocks, and the
income stream produced by dividend payments, if any, is unpredictable, the
sponsor cannot provide any assurance that dividends will be sufficient to meet
any or all expenses of a trust. If the balances in the Income and Capital
Accounts are insufficient to provide for amounts payable by the trust, the
trustee has the power to sell securities to pay such amounts. These sales may
result in capital gains or losses to unitholders. It is expected that the
income stream produced by dividend payments may be insufficient to meet the
expenses of a trust and, accordingly, it is expected that securities will be
sold to pay all of the fees and expenses of the trust.
The trust shall also bear the expenses associated with updating the
trust's registration statement and maintaining registration or qualification of
the units and/or a trust under federal or state securities laws subsequent to
initial registration. Such expenses shall include legal fees, accounting fees,
typesetting fees, electronic filing expenses and regulatory filing fees. The
expenses associated with updating registration statements have been
historically paid by a unit investment trust's sponsor.
Portfolio Transactions and Brokerage Allocation
When a trust sells securities, the composition and diversity of the
securities in the trust may be altered. In order to obtain the best price for a
trust, it may be necessary for the supervisor to specify minimum amounts (such
as 100 shares) in which blocks of securities are to be sold. In effecting
purchases and sales of a trust's portfolio securities, the sponsor may direct
that orders be placed with and brokerage commissions be paid to brokers,
including brokers which may be affiliated with the trust, the sponsor or
dealers participating in the offering of units.
Purchase, Redemption and Pricing of Units
Public Offering Price. Units of a trust are offered at the public offering
price (which is based on the aggregate underlying value of the securities in
the trust and includes the initial sales fee, plus a pro rata share of any
accumulated amounts in the accounts of the trust). The initial sales fee is
equal to the difference between the maximum sales fee and the creation and
development fee ("C&D Fee"). The maximum sales fee is set forth in Part A of
the prospectus. The C&D Fee will be collected as described in this prospectus.
During the initial offering period, a portion of the public offering price
includes an amount of securities to pay for all or a portion of the costs
incurred in establishing a trust ("organization costs"). These organization
costs include the cost 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, fees paid to a porfolio consultant for assisting the sponsor in
selecting the trust's porfolio, and the initial fees and expenses of the
trustee. These costs will be deducted from a trust as of the end of the initial
offering period or after six months, at the discretion of the sponsor. As
indicated above, the initial public offering price of the units was established
by dividing the aggregate underlying value of the securities by the number of
units outstanding. Such price determination as of the opening of business on
the date a trust was created was made on the basis of an evaluation of the
securities in the trust prepared by the evaluator. After the opening of
business on this date, the evaluator will appraise or cause to be appraised
daily the value of the underlying securities as of the close of the New York
Stock Exchange on days the New York Stock Exchange is open and will adjust the
public offering price of the units commensurate with such valuation. Such
public offering price will be effective for all orders properly received at or
prior to the close of trading on the New York Stock Exchange on each such day.
Orders received by the trustee, sponsor or any dealer for purchases, sales or
redemptions after that time, or on a day when the New York Stock Exchange is
closed, will be held until the next determination of price.
The value of the securities is determined on each business day by the
evaluator based on the closing sale prices on a national securities exchange or
the NASDAQ National Market System or by taking into account the same factors
referred to under "Computation of Redemption Price."
Public Distribution of Units. During the initial offering period, units of
a trust will be distributed to the public at the public offering price thereof.
Upon the completion of the initial offering, units which remain unsold or which
may be acquired in the secondary market may be offered at the public offering
price determined in the manner provided above.
The sponsor intends to qualify units of a trust for sale in a number of
states. Units will be sold through dealers who are members of FINRA and through
others. Broker-dealers and others will be allowed a concession or agency
commission in connection with the distribution of units during the initial
offering period as set forth in the prospectus.
The sponsor reserves the right to reject, in whole or in part, any order
for the purchase of units.
Sponsor Profits. The sponsor will receive gross sales fees equal to the
percentage of the public offering price of the units of a trust described in
the prospectus. In addition, the sponsor may realize a profit (or sustain a
loss) as of the date a trust is created resulting from the difference between
the purchase prices of the securities to the sponsor and the cost of such
securities to the trust. Thereafter, on subsequent deposits the sponsor may
realize profits or sustain losses from such deposits. The sponsor may realize
additional profits or losses during the initial offering period on unsold units
as a result of changes in the daily market value of the securities in the
trust.
Market for Units. After the initial offering period, the sponsor may
maintain a market for units of a trust offered hereby and continuously offer to
purchase said units at prices, determined by the evaluator, based on the value
of the underlying securities. Unitholders who wish to dispose of their units
should inquire of their broker as to current market prices in order to
determine whether there is in existence any price in excess of the redemption
price and, if so, the amount thereof. The offering price of any units resold by
the sponsor will be in accord with that described in the currently effective
prospectus describing such units. Any profit or loss resulting from the resale
of such units will belong to the sponsor. If the sponsor decides to maintain a
secondary market, it may suspend or discontinue purchases of units of the trust
if the supply of units exceeds demand, or for other business reasons.
Redemption. A unitholder who does not dispose of units in the secondary
market described above may cause units to be redeemed by the trustee by making
a written request to the trustee at its Unit Investment Trust Division office
in the city of New York. Unitholders must sign the request, and such transfer
instrument, exactly as their names appear on the records of the trustee. If the
amount of the redemption is $500 or less and the proceeds are payable to the
unitholder(s) of record at the address of record, no signature guarantee is
necessary for redemptions by individual account owners (including joint
owners). Additional documentation may be requested, and a signature guarantee
is always required, from corporations, executors, administrators, trustees,
guardians or associations. The signatures must be guaranteed by a participant
in the Securities Transfer Agents Medallion Program ("STAMP") or such other
signature guaranty program in addition to, or in substitution for, STAMP, as
may be accepted by the trustee.
Redemption shall be made by the trustee no later than the second business
day following the day on which a tender for redemption is received (the
"Redemption Date") by payment of cash equivalent to the redemption price,
determined as set forth below under "Computation of Redemption Price," as of
one hour prior to the close of the New York Stock Exchange next following such
tender, multiplied by the number of units being redeemed. Any units redeemed
shall be canceled and any undivided fractional interest in the related trust
extinguished. The price received upon redemption might be more or less than the
amount paid by the unitholder depending on the value of the securities in the
trust at the time of redemption. Certain broker-dealers may charge a
transaction fee for processing redemption requests.
Under regulations issued by the Internal Revenue Service, the trustee is
required to withhold a specified percentage of the principal amount of a unit
redemption if the trustee has not been furnished the redeeming unitholder's tax
identification number in the manner required by such regulations. Any amount so
withheld is transmitted to the Internal Revenue Service and may be recovered by
the unitholder only when filing a tax return. Under normal circumstances the
trustee obtains the unitholder's tax identification number from the selling
broker. However, any time a unitholder elects to tender units for redemption,
such unitholder should make sure that the trustee has been provided a certified
tax identification number in order to avoid this possible "back-up
withholding." In the event the trustee has not been previously provided such
number, one must be provided at the time redemption is requested. Any amounts
paid on redemption representing unpaid dividends shall be withdrawn from the
Income Account of a trust to the extent that funds are available for such
purpose. All other amounts paid on redemption shall be withdrawn from the
Capital Account for a trust.
The right of redemption may be suspended and payment postponed for more
than two business days following the day on which tender for redemption is made
(i) for any period during which the New York Stock Exchange is closed, other
than customary weekend and holiday closings, or during which (as determined by
the Securities and Exchange Commission) trading on the New York Stock Exchange
is restricted; (ii) for any period during which an emergency exists as a result
of which disposal by the trustee of securities is not reasonably practicable or
it is not reasonably practicable to fairly determine the value of the
underlying securities in accordance with the trust agreement; or (iii) for such
other period as the Securities and Exchange Commission may by order permit. The
trustee is not liable to any person in any way for any loss or damage which may
result from any such suspension or postponement.
Computation of Redemption Price. The redemption price per unit (as well as
the secondary market public offering price) will generally be determined on the
basis of the last sale price of the securities in a trust. The redemption price
per unit is the pro rata share of each unit in a trust determined generally on
the basis of (i) the cash on hand in the trust or moneys in the process of
being collected; and (ii) the value of the securities in the trust less (a)
amounts representing taxes or other governmental charges payable out of the
trust, (b) any amount owing to the trustee for its advances and (c) the accrued
expenses of the trust. During the initial offering period, the redemption price
and the secondary market repurchase price will also include estimated
organizational costs. The evaluator may determine the value of the securities
in the trust in the following manner: if the securities are listed on a
national or foreign securities exchange or the NASDAQ National Market System,
such evaluation shall generally be based on the last available sale price on or
immediately prior to the Evaluation Time on the exchange or NASDAQ National
Market System which is the principal market therefor, which shall be deemed to
be the New York Stock Exchange if the securities are listed thereon (unless the
evaluator deems such price inappropriate as a basis for evaluation) or, if
there is no such available sale price on such exchange, at the last available
bid prices (offer prices for primary market purchases) of the securities.
Securities not listed on the New York Stock Exchange but principally traded on
the NASDAQ National Market System will be valued at the NASDAQ National Market
System's official closing price. If the securities are not so listed or, if so
listed, the principal market therefor is other than on such exchange or there
is no such available sale price on such exchange, such evaluation shall
generally be based on the following methods or any combination thereof
whichever the evaluator deems appropriate: (i) on the basis of the current bid
price (offer prices for primary market purchases) for comparable securities
(unless the evaluator deems such price inappropriate as a basis for
evaluation); (ii) by determining the valuation of the securities on the bid
side (offer side for primary market purchases) of the market by appraisal; or
(iii) by any combination of the above. Notwithstanding the foregoing, the
evaluator or its designee, will generally value foreign securities primarily
traded on foreign exchanges at their fair value which may be other than their
market price. If the trust holds securities denominated in a currency other
than U.S. dollars, the evaluation of such security is based upon U.S. dollars
based on current bid side (offer side for primary market purchases) exchange
rates (unless the evaluator deems such prices inappropriate as a basis for
valuation).
Retirement Plans. A trust may be well suited for purchase by Individual
Retirement Accounts, Keogh Plans, pension funds and other qualified retirement
plans. Generally, capital gains and income received under each of the foregoing
plans are deferred from federal taxation. All distributions from such plans are
generally treated as ordinary income but may, in some cases, be eligible for
special income averaging or tax deferred rollover treatment. Investors
considering participation in any such plan should review specific tax laws
related thereto and should consult their attorneys or tax advisers with respect
to the establishment and maintenance of any such plan. Such plans are offered
by brokerage firms and other financial institutions. The trust will lower the
minimum investment requirement for IRA accounts to 1 unit. Fees and charges
with respect to such plans may vary.
Ownership of Units. Ownership of units will not be evidenced by
certificates. All evidence of ownership of units will be recorded in book entry
form at Depository Trust Company ("DTC") through an investor's brokers'
account. Units held through DTC will be registered in the nominee name of Cede
& Co. Individual purchases of beneficial ownership interest in the trust will
be made in book entry form through DTC. Ownership and transfer of units will be
evidenced and accomplished by book entries made by DTC and its participants.
DTC will record ownership and transfer of the units among DTC participants and
forward all notices and credit all payments received in respect of the units
held by the DTC participants. Beneficial owners of units will receive written
confirmation of their purchases and sale from the broker dealer or bank from
whom their purchase was made. Units are transferable by making a written
request properly accompanied by a written instrument or instruments of transfer
which should be sent registered or certified mail for the protection of the
unitholder. Record holders must sign such written request exactly as their
names appear on the records of the trust. The signatures must be guaranteed by
a participant in the STAMP or such other signature guaranty program in addition
to, or in substitution for, STAMP, as may be acceptable by the trustee.
Units may be purchased in denominations of one unit or any multiple
thereof, subject to the minimum investment requirement. Fractions of units, if
any, will be computed to three decimal places.
Taxes
This section summarizes some of the main U.S. federal income tax
consequences of owning units of the trust. This section is current as of the
date of this prospectus. Tax laws and interpretations change frequently, and
these summaries do not describe all of the tax consequences to all taxpayers.
For example, these summaries generally do not describe your situation if you
are a corporation, a non-U.S. person, a broker/dealer, or other investor with
special circumstances. In addition, this section does not describe your state,
local or foreign tax consequences.
This federal income tax summary is based in part on the advice of counsel
to the sponsor. The Internal Revenue Service could disagree with any
conclusions set forth in this section. In addition, our counsel was not asked
to review, and has not reached a conclusion with respect to the federal income
tax treatment of the assets to be deposited in your trust. This may not be
sufficient for you to use for the purpose of avoiding penalties under federal
tax law.
As with any investment, you should seek advice based on your individual
circumstances from your own tax advisor.
Trust Status. Your trust intends to qualify as a "regulated investment
company" under the federal tax laws. If your trust qualifies as a regulated
investment company and distributes its income as required by the tax law, the
trust generally will not pay federal income taxes.
Distributions. Trust distributions are generally taxable. After the end of
each year, you will receive a tax statement that separates your trust's
distributions into two categories, ordinary income distributions and capital
gain dividends. Ordinary income distributions are generally taxed at your
ordinary tax rate. Generally, you will treat all capital gain dividends as
long-term capital gains regardless of how long you have owned your units. To
determine your actual tax liability for your capital gain dividends, you must
calculate your total net capital gain or loss for the tax year after
considering all of your other taxable transactions, as described below. In
addition, your trust may make distributions that represent a return of capital
for tax purposes and thus will generally not be currently taxable to you. The
tax status of your distributions from your trust is not affected by whether you
reinvest your distributions in additional shares or receive them in cash. The
income from your trust that you must take into account for federal income tax
purposes is not reduced by amounts used to pay the deferred sales fee, if any.
The tax laws may require you to treat distributions made to you in January as
if you had received them on December 31 of the previous year. Income from a
trust may also be subject to a 3.8% "Medicare tax." This tax will generally
apply to your net investment income if your adjusted gross income exceeds
certain threshold amounts, which are $250,000 in the case of married couples
filing joint returns and $200,000 in the case of single individuals.
Dividends Received Deduction. A corporation that owns units generally will
not be entitled to the dividends received deduction with respect to many
dividends received from the trust because the dividends received deduction is
generally not available for distributions from regulated investment companies.
Sale or Redemption of Units. If you sell or redeem your units, you will
generally recognize a taxable gain or loss. To determine the amount of this
gain or loss, you must subtract your tax basis in your units from the amount
you receive in the transaction. Your tax basis in your units is generally equal
to the cost of your units, generally including sales charges. In some cases,
however, you may have to adjust your tax basis after you purchase your units.
Capital Gains and Losses. If you are an individual, the maximum marginal
stated federal tax rate for net capital gain is generally 20% (15% or 0% for
taxpayers with taxable incomes below certain thresholds). Capital gains may
also be subject to the Medicare Tax described above.
Net capital gain equals net long-term capital gain minus net short-term
capital loss for the taxable year. 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. You must exclude the date you
purchase your units to determine your holding period. However, if you receive a
capital gain dividend from your trust and sell your unit at a loss after
holding it for six months or less, the loss will be recharacterized as
long-term capital loss to the extent of the capital gain dividend received. The
tax rates for capital gains realized from assets held for one year or less are
generally the same as for ordinary income. The Internal Revenue Code treats
certain capital gains as ordinary income in special situations. An election may
be available to you to defer recognition of the gain attributable to a capital
gain dividend if you make certain qualifying investments within a limited time.
You should talk to your tax advisor about the availability of this deferral
election and its requirements. The trust's positions in FLEX Options may reduce
the amount of long term capital gains and, thus, the deductibility of capital
gain dividends.
Treatment of Trust Expenses. Expenses incurred and deducted by your trust
will generally not be treated as income taxable to you. In some cases, however,
you may be required to treat your portion of these trust expenses as income.You
may not be able to deduct some or all of these expenses.
Treatment of the FLEX Options. The trust's investments in offsetting
positions with respect to the Reference Asset may be "straddles" for U.S.
federal income tax purposes. The straddle rules may affect the character of
gains (or losses) realized by the trust, and losses realized by the trust on
positions that are part of a straddle may be deferred under the straddle rules,
rather than being taken into account in calculating taxable income for the
taxable year in which the losses are realized. In addition, certain carrying
charges (including interest expense) associated with positions in a straddle
may be required to be capitalized rather than deducted currently. Certain
elections that the trust may make with respect to its straddle positions may
also affect the amount, character and timing of the recognition of gains or
losses from the affected positions.
The tax consequences of straddle transactions to the trust are not
entirely clear in all situations under currently available authority. The
straddle rules may increase the amount of short-term capital gain realized by
the trust, which is taxed as ordinary income when distributed to U.S.
shareholders in a non-liquidating distribution. Because application of the
straddle rules may affect the character of gains or losses, defer losses and/or
accelerate the recognition of gains or losses from the affected straddle
positions, if the trust makes a non-liquidating distribution of its short-term
capital gain, the amount which must be distributed to U.S. shareholders as
ordinary income may be increased or decreased substantially as compared to the
trust that did not engage in such transactions.
The FLEX Options included in the portfolio are exchange-traded options.
Under Section 1256 of the Code, certain types of exchange-traded options are
treated as if they were sold (i.e., "marked to market") at the end of each
year. The trust does not believe that the positions held by the trust will be
subject to Section 1256, which means that the positions will not be marked to
market, but the positions will be subject to the straddle rules.
Foreign Investors. If you are a foreign investor (i.e., an investor other
than a U.S. citizen or resident or a U.S. corporation, partnership, estate or
trust), you should be aware that, generally, subject to applicable tax
treaties, distributions from your trust will be characterized as dividends for
federal income tax purposes (other than dividends which the trust properly
reports as capital gain dividends) and will be subject to U.S. income taxes,
including withholding taxes, subject to certain exceptions described below.
However, distributions received by a foreign investor from your trust that are
properly reported by the trust as capital gain dividends may not be subject to
U.S. federal income taxes, including withholding taxes, provided that the trust
makes certain elections and certain other conditions are met. Distributions
from the trust that are properly reported by the trust as an interest-related
dividend attributable to certain interest income received by the trust or as a
short-term capital gain dividend attributable to certain net short-term capital
gain income received by the trust may not be subject to U.S. federal income
taxes, including withholding taxes when received by certain foreign investors,
provided that the trust makes certain elections and certain other conditions
are met. In addition, distributions to, and gross proceeds from dispositions of
units by, (i) certain non-U.S. financial institutions that have not entered
into an agreement with the U.S. Treasury to collect and disclose certain
information and are not resident in a jurisdiction that has entered into such
an agreement with the U.S. Treasury; and (ii) certain other non-U.S. entities
that do not provide certain certifications and information about the entity's
U.S. owners may be subject to a U.S. withholding tax of 30%. However proposed
regulations may eliminate the requirement to withhold on payments of gross
proceeds from dispositions.
Experts
Legal Matters. Chapman and Cutler LLP, 111 West Monroe Street, Chicago,
Illinois 60603, acts as counsel for the trust and has passed upon the legality
of the units.
Independent Registered Public Accounting Firm. The statement of financial
condition, including the Trust Portfolio, appearing herein, has been audited by
Grant Thornton LLP, an independent registered public accounting firm, as set
forth in their report thereon appearing elsewhere herein, and is included in
reliance on such report given on the authority of such firm as experts in
accounting and auditing.
GUGGENHEIM DEFINED PORTFOLIOS
GUGGENHEIM PORTFOLIO PROSPECTUS-PART B
___________, 2020
Where to Learn More
You can contact us for free information about this and other investments.
Visit us on the Internet
http://www.guggenheiminvestments.com
Call Guggenheim Funds
(800) 345-7999
Pricing Line (888) 248-4954
Call The Bank of New York Mellon
(800) 701-8178 (investors)
(800) 647-3383 (brokers)
Additional Information
This prospectus does not contain all information filed with the Securities
and Exchange Commission. To obtain a copy of this information (a duplication
fee may be required):
E mail: publicinfo@sec.gov
Write: Public Reference Room
Washington, D.C. 20549-0102
Visit: http://www.sec.gov (EDGAR Database)
Call: 1-202-942-8090 (only for information on the operation of the Public
Reference Room)
When units of the trust are no longer available, we may use this
prospectus as a preliminary prospectus for a future trust. In this case you
should note that:
The information in this prospectus is not complete with respect to future
trusts and may be changed. No one may sell units of a future trust until a
registration statement is filed with the Securities and Exchange Commission and
is effective. This prospectus is not an offer to sell units and is not
soliciting an offer to buy units in any state where the offer or sale is not
permitted.
Contents
Investment Summary
A concise 2 Overview
description 2 Investment Objective
of essential 2 Principal Investment Strategy
information 3 Market Scenario Illustrations
about the 6 Assets Held by the Trust
portfolio 7 The Reference Asset and The Index
8 Milliman Financial Risk Management LLC
9 Essential Information
9 Summary of Defined Terms
9 Principal Risks
14 Who Should Invest
14 Fees and Expenses
15 Example
16 Trust Portfolio
Understanding Your Investments
Detailed 18 How to Buy Units
information 22 How to Sell Your Units
to help you 22 Distributions
understand 23 Investment Risks
your 28 How the Trust Works
investment 29 General Information
30 Expenses
32 Report of Independent Registered Public
Accounting Firm
33 Statement of Financial Condition
34 Appendix
For the Table of Contents of Part B, see Part B of the prospectus.
Where to Learn More
You can contact us for Visit us on the Internet
free information about Guggenheiminvestments.com
these investments. Call Guggenheim Investments
800 345 7999 / Pricing line 800 248 4954
Call The Bank of New York Mellon
800 701 8178 Investors / 800 647 3383 Brokers
Additional Information
This prospectus does not contain all information filed with the Securities and
Exchange Commission. To obtain or copy this information (a duplication fee may
be required):
E-mail: publicinfo@sec.gov
Write: Public Reference Room, Washington, D.C. 20549-0102
Visit: sec.gov (EDGAR Database)
Call: 202 942 8090 (only for information on the operation
of the Public Reference Room)
Refer to: Guggenheim Defined Portfolios, Series 2017
Securities Act file number: 333-______
Investment Company Act file number: 811-03763
When units of the trust are no longer available, we may use this prospectus as
a preliminary prospectus for a future trust.
The information in this prospectus is not complete with respect to future
trusts and may be changed. No one may sell units of a future trust until a
registration statement is filed with the Securities and Exchange Commission and
is effective. This prospectus is not an offer to sell units and is not
soliciting an offer to buy units in any state where the offer or sale is not
permitted.
GUGGENHEIM LOGO
Unit Investment Trusts
__.__.2020
Guggenheim Defined Portfolios, Series 2017 Prospectus
Defined Outcome Trust: Large Cap Buffer 10 Portfolio, July 2021
GuggenheimInvestments.com
UNDERTAKING TO FILE REPORTS
Subject to the terms and conditions of Section 15(d) of the Securities
Exchange Act of 1934, the undersigned registrant hereby undertakes to file with
the Securities and Exchange Commission such supplementary and periodic
information, documents, and reports as may be prescribed by any rule or
regulation of the Commission heretofore or hereafter duly adopted pursuant to
authority conferred in that section.
CONTENTS OF REGISTRATION STATEMENT
A. Bonding Arrangements of Depositor:
The Depositor has obtained the following Securities Dealer Blanket Bond for
its officers, directors and employees:
INSURER/POLICY NO. AMOUNT
National Union Fire Insurance
Company of Pittsburgh, Pennsylvania
5692790 $4,000,000
This Registration Statement comprises the following papers and documents.
The Facing Sheet
The Prospectus
The Signatures
Consents of Counsel
Exhibits
The following exhibits:
1.1 Reference Trust Agreement (to be supplied by amendment).
1.1.1 Standard Terms and Conditions of Trust (Reference is made to Exhibit
1.1.1 to Amendment No. 2 to the Registration Statement on Form S-6 for
Claymore Securities Defined Portfolios, Series 116 (File No.
333-72828) filed on December 18, 2001).
2.1 Code of Ethics (Reference is made to Exhibit 2.1 to the Registration
Statement on Form S-6 for Claymore Securities Deferred Portfolios,
Series 213 (File No. 333-122184) filed on February 9, 2005).
3.1 Opinion of counsel as to legality of the securities being registered
including a consent to the use of its name in the Registration
Statement (to be supplied by amendment).
3.2 Opinion of counsel as to the Trustee and the Trust(s), including a
consent to the use of its name in the Registration Statement (to be
supplied by amendment).
4.1 Consent of Independent Registered Public Accounting Firm (to be
supplied by amendment).
6.0 Powers of Attorney authorizing Amy Lee to execute the Registration
Statement. (Reference is made to Exhibit 6.0 to Amendment No. 1 to the
Registration Statement on Form S-6 for Guggenheim Defined Portfolios,
Series 2001 (File No. 333-236113) filed on January 28, 2020).
9.1 Form of Portfolio Support and License Agreement (to be supplied by
amendment).
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Guggenheim Defined Portfolios, Series 2017 has duly caused this Registration
Statement to be signed on its behalf by the undersigned thereunto duly
authorized, in the City of Chicago, and State of Illinois, on the 23rd day of
March, 2020.
GUGGENHEIM DEFINED PORTFOLIOS, SERIES 2017, Registrant
By: GUGGENHEIM FUNDS DISTRIBUTORS, LLC, Depositor
By: /s/ Amy Lee
---------------
Amy Lee
Vice President and Secretary
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated:
SIGNATURE* TITLE DATE
)
) By: /s/ Amy Lee
) ---------------
) Amy Lee
) Attorney-in-Fact*
JERRY W. MILLER* Chief Executive Officer and )
President of Guggenheim Funds ) March 23, 2020
Distributors, LLC )
)
DOMINICK COGLIANDRO* Chief Operating Officer of ) March 23, 2020
Guggenheim Funds Distributors, )
LLC )
)
JULIE JACQUES* Treasurer of Guggenheim Funds ) March 23, 2020
Distributors, LLC )
)
JULIE JACQUES* Principal Financial Officer of ) March 23, 2020
Guggenheim Funds Distributors, )
LLC )
FARHAN SHARAFF Chief Investment Officer of
Guggenheim Funds Distributors,
LLC
/s/ Amy Lee Vice President and Secretary of March 23, 2020
----------- Guggenheim Funds Distributors,
AMY LEE LLC
-------------
* Executed copies of the related powers of attorney were filed as Exhibit 6.0
to Amendment No. 1 to the Registration Statement of Guggenheim Defined
Portfolios, Series 2001 on January 28, 2020.
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The consent of Grant Thornton LLP to the use of its report and to the
reference to such firm in the Prospectus included in the Registration Statement
will be filed as Exhibit 4.1 to the Registration Statement.
CONSENT OF CHAPMAN AND CUTLER LLP
The consent of Chapman and Cutler LLP to the use of its name in the
Prospectus included in the Registration Statement will be contained in its
opinion to be filed as Exhibit 3.1 to the Registration Statement.
CONSENT OF DORSEY & WHITNEY LLP
The consent of Dorsey & Whitney LLP to the use of its name in the
Prospectus included in the Registration Statement will be contained in its
opinion to be filed as Exhibit 3.2 to the Registration Statement.
MEMORANDUM
Re: Guggenheim Defined Portfolios, Series 2017
The list of securities comprising the trust of the fund, the evaluation,
record and distribution dates and other changes pertaining specifically to the
new series, such as size and number of units of the trust in the fund and the
statement of financial condition of the new fund will be filed by amendment.
1940 ACT
FORMS N-8A AND N-8B-2
Form N-8A and Form N-8B-2 were filed in respect of Guggenheim Defined
Portfolios, Series 718 (and subsequent series) (File No. 333-169214).
1933 ACT
THE INDENTURE
The form of the proposed Standard Terms and Conditions of Trust is expected
to be in all respects consistent with the form of the Standard Terms and
Conditions of Trust dated December 18, 2001 relative to Claymore Securities
Defined Portfolios, Series 116.
CHAPMAN AND CUTLER LLP
Chicago, Illinois
March 23, 2020