THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 139
TRUST AGREEMENT
Dated: January 22, 1996
The Trust Agreement among Nike Securities L.P., as
Depositor, The Chase Manhattan Bank (National Association),
as Trustee and First Trust Advisors L.P., as Evaluator and
Portfolio Supervisor, sets forth certain provisions in full
and incorporates other provisions by reference to the
document entitled "Standard Terms and Conditions of Trust
for The First Trust Special Situations Trust, Series 22 and
certain subsequent Series, Effective November 20, 1991"
(herein called the "Standard Terms and Conditions of
Trust"), and such provisions as are incorporated by
reference constitute a single instrument. All references
herein to Articles and Sections are to Articles and Sections
of the Standard Terms and Conditions of Trust.
WITNESSETH THAT:
In consideration of the premises and of the mutual
agreements herein contained, the Depositor, the Trustee, the
Evaluator and the Portfolio Supervisor agree as follows:
PART I
STANDARD TERMS AND CONDITIONS OF TRUST
Subject to the provisions of Part II and Part III
hereof, all the provisions contained in the Standard Terms
and Conditions of Trust are herein incorporated by reference
in their entirety and shall be deemed to be a part of this
instrument as fully and to the same extent as though said
provisions had been set forth in full in this instrument.
PART II
SPECIAL TERMS AND CONDITIONS OF TRUST
The following special terms and conditions are hereby
agreed to:
A. The Securities initially deposited in the Trust
pursuant to Section 2.01 of the Standard Terms and
Conditions of Trust are set forth in the Schedules hereto.
B. (1) The aggregate number of Units outstanding for
the Trust on the Initial Date of Deposit is 15,000 Units.
(2) The initial fractional undivided interest in
and ownership of the Trust represented by each Unit thereof
shall be 1/15,000.
Documents representing this number of Units for the
Trust are being delivered by the Trustee to the Depositor
pursuant to Section 2.03 of the Standard Terms and
Conditions of Trust.
C. The Percentage Ratio is as follows on the Initial
Date of Deposit:
3.34% ALLTEL Corporation, 3.15% AT&T
Corporation, 3.15% AirTouch
Communications, Inc., 3.43% America
Online, Inc., 3.08% Ameritech
Corporation, 3.48% Arrow Electronics,
Inc., 3.02% BellSouth Corporation,
3.40% Cabletron Systems, Inc., 3.55%
Cisco Systems, Inc., 3.23% Compaq
Computer Corporation, 3.70% DSC
Communications Corporation, 3.21%
Disney (Xxxx) Company, 3.24% First Data
Corporation, 3.16% Hewlett-Packard
Company, 3.16% Infinity Broadcasting
Corporation (Class A), 2.96% Intel
Corporation, 2.84% Intuit, 3.65% LCI
International, Inc., 3.51% Xxx Research
Corporation, 3.42% Microsoft
Corporation, 3.40% Mobile
Telecommunications Technologies
Corporation, 3.42% Molex, Inc., 3.42%
Motorola, Inc., 3.51% Oracle Systems
Corporation, 3.41% Sanmina Corporation,
3.45% Solectron Corporation, 3.65% Sun
Microsystems, Inc., 3.60% 3Com
Corporation, 3.23% Tele-Communications,
Inc. (Class A), 3.23% Time Warner Inc.
D. The Record Date shall be as set forth in the
prospectus for the sale of Units dated the date hereof (the
"Prospectus") under "Summary of Essential Information."
E. The Distribution Date shall be as set forth in the
Prospectus under "Summary of Essential Information."
F. The Mandatory Termination Date for the Trust shall
be as set forth in the Prospectus under "Summary of
Essential Information."
G. The Evaluator's compensation as referred to in
Section 4.03 of the Standard Terms and Conditions of Trust
shall be an annual fee of $0.0017 per Unit, calculated based
on the largest number of Units outstanding during each
period in respect of which a payment is made pursuant to
Section 3.05.
H. The Trustee's Compensation Rate pursuant to
Section 6.04 of the Standard Terms and Conditions of Trust
shall be an annual fee of $.0095 per Unit, calculated based
on the largest number of Units outstanding during each
period in respect of which a payment is made pursuant to
Section 3.05. However, in no event, except as may otherwise
be provided in the Standard Terms and Conditions of Trust,
shall the Trustee receive compensation in any one year from
any Trust of less than $2,000 for such annual compensation.
I. The Initial Date of Deposit for the Trust is
January 22, 1996.
J. The minimum amount of Equity Securities to be sold
by the Trustee pursuant to Section 5.02 of the Indenture for
the redemption of Units shall be 100 shares.
PART III
A. Section 1.01(2) shall be amended to read as
follows:
"(2) "Trustee" shall mean The Chase Manhattan Bank
(National Association), or any successor trustee appointed
as hereinafter provided."
All references to United States Trust Company of new
York in the Standard Terms and Conditions of Trust shall be
amended to refer to The Chase Manhattan Bank (National
Association).
B. The term "Capital Account" as set forth in the
Prospectus shall be deemed to refer to the "Principal
Account."
C. The following sentence shall be substituted for
the second sentence of paragraph (b) of Section 2.01:
The Depositor, in each case, shall ensure that
each deposit of additional Securities pursuant to this
Section shall be, as nearly as is practicable, in the
identical ratio as the Percentage Ratio for such
Securities as is specified in the Trust Agreement for
each Trust (provided, however, that any deposit of
additional securities made subsequent to the 90-day
period following the first deposit of securities in a
Trust shall exactly replicate such Percentage Ratio),
and the Depositor shall ensure that such Securities are
identical to those deposited on the Initial Date of
Deposit.
D. The second paragraph of Section 3.02 of the
Standard Terms and Conditions is hereby deleted and replaced
with the following sentence:
"Any non-cash distributions (other than a non-
taxable distribution of the shares of the distributing
corporation which shall be retained by a Trust)
received by a Trust shall be dealt with in the manner
described at Section 3.11, herein, and shall be
retained or disposed of by such Trust according to
those provisions. The proceeds of any disposition
shall be credited to the Income Account of a Trust.
Neither the Trustee nor the Depositor shall be liable
or responsible in any way for depreciation or loss
incurred by reason of any such sale."
E. Paragraph (c) of Subsection II of Section 3.05 of
the Standard Terms and Conditions of Trust is hereby amended
to read as follows:
"On each Distribution Date the Trustee shall
distribute to each Unit holder of record at the close
of business on the Record Date immediately preceding
such Distribution Date an amount per Unit equal to such
Unit holder's pro rata share of the balance of the
Principal Account (except for monies on deposit therein
required to purchase Contract Obligations) computed as
of the close of business on such Record Date after
deduction of any amounts provided in Subsection I."
F. Section 3.05.II(a) of the Standard Terms and
Conditions of Trust is hereby amended to read in its
entirety as follows:
"II. (a) On each Distribution Date, the Trustee
shall distribute to each Unit holder of record at the
close of business on the Record Date immediately
preceding such Distribution Date an amount per Unit
equal to such Unit holder's Income Distribution (as
defined below), plus such Unit holder's pro rata share
of the balance of the Principal Account (except for
monies on deposit therein required to purchase Contract
Obligations) computed as of the close of business on
such Record Date after deduction of any amounts
provided in Subsection I, provided, however, that the
Trustee shall not be required to make a distribution
from the Principal Account unless the amount available
for distribution shall equal $1.00 per 100 Units.
Each Trust shall provide the following
distribution elections: (1) distributions to be made
by check mailed to the post office address of the Unit
holder as it appears on the registration books of the
Trustee, or (2) the following reinvestment option:
The Trustee will, for any Unit holder who
provides the Trustee written instruction, properly
executed and in form satisfactory to the Trustee,
received by the Trustee no later than its close of
business 10 business days prior to a Record Date
(the "Reinvestment Notice Date"), reinvest such
Unit holder's distribution from the Income and
Capital Accounts in Units of the Trust, purchased
from the Depositor, to the extent the Depositor
shall make Units available for such purchase, at
the Depositor's offering price as of the fifth
business day prior to the following Distribution
Date, and at such reduced sales charge as may be
described in the prospectus for the Trusts. If,
for any reason, the Depositor does not have Units
of the Trust available for purchase, the Trustee
shall distribute such Unit holder's distribution
from the Income and Capital Accounts in the manner
provided in clause (1) of the preceding paragraph.
The Trustee shall be entitled to rely on a written
instruction received as of the Reinvestment Notice
Date and shall not be affected by any subsequent
notice to the contrary. The Trustee shall have no
responsibility for any loss or depreciation
resulting from any reinvestment made in accordance
with this paragraph, or for any failure to make
such reinvestment in the event the Depositor does
not make Units available for purchase.
Any Unit holder who does not effectively elect
reinvestment in Units of their respective Trust
pursuant to the preceding paragraph shall receive a
cash distribution in the manner provided in clause (1)
of the second preceding paragraph."
G. Section 3.05.II(b) of the Standard Terms and
Conditions of Trust is hereby amended to read in its
entirety as follows:
"II. (b) For purposes of this Section 3.05, the
Unit holder's Income Distribution shall be equal to
such Unit holder's pro rata share of the cash balance
in the Income Account computed as of the close of
business on the Record Date immediately preceding such
Income Distribution after deduction of (i) the fees and
expenses then deductible pursuant to Section 3.05.I.
and (ii) the Trustee's estimate of other expenses
properly chargeable to the Income Account pursuant to
the Indenture which have accrued, as of such Record
Date, or are otherwise properly attributable to the
period to which such Income Distribution relates."
H. Section 3.11 of the Standard Terms and Conditions
of Trust is hereby deleted in its entirety and replaced with
the following language:
"Section 3.11. Notice to Depositor.
In the event that the Trustee shall have been
notified at any time of any action to be taken or
proposed to be taken by at least a legally required
number of holders of any Securities deposited in a
Trust, the Trustee shall take such action or omit from
taking any action, as appropriate, so as to insure that
the 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.
In the event that an offer by the issuer of any of
the Securities or any other party shall be made to
issue new securities, or to exchange securities, for
Trust Securities, the Trustee shall reject such offer.
However, should any issuance, exchange or substitution
be effected notwithstanding such rejection or without
an initial offer, any securities, cash and/or property
received shall be deposited hereunder and shall be
promptly sold, if securities or property, by the
Trustee pursuant to the Depositor's direction, unless
the Depositor advises the Trustee to keep such
securities or property. The Depositor may rely on the
Portfolio Supervisor in so advising the Trustee. The
cash received in such exchange and cash proceeds of any
such sales shall be distributed to Unit holders on the
next distribution date in the manner set forth in
Section 3.05 regarding distributions from the Principal
Account. The Trustee shall not be liable or
responsible in any way for depreciation or loss
incurred by reason of any such sale.
Neither the Depositor nor the Trustee shall be
liable to any person for any action or failure to take
action pursuant to the terms of this Section 3.11.
Whenever new securities or property is received
and retained by a Trust pursuant to this Section 3.11,
the Trustee shall, within five days thereafter, mail to
all Unit holders of such Trust notices of such
acquisition unless legal counsel for such Trust
determines that such notice is not required by The
Investment Company Act of 1940, as amended."
I. Section 3.05 of Article III of the Standard Terms
and Conditions of Trust is hereby amended to include the
following subsection:
"Section 3.05.I.(e) deduct from the Interest
Account or, to the extent funds are not available in
such Account, from the Principal Account and pay to the
Depositor the amount that it is entitled to receive
pursuant to Section 3.14.
J. Article III of the Standard Terms and Conditions
of Trust is hereby amended by inserting the following
paragraphs which shall be entitled Section 3.14.:
"Section 3.14. Bookkeeping and Administrative
Expenses. As compensation for providing bookkeeping
and other administrative services of a character
described in Section 26(a)(2)(C) of the Investment
Company Act of 1940 to the extent such services are in
addition to, and do not duplicate, the services to be
provided hereunder by the Trustee or the Portfolio
Supervisor, the Depositor shall receive against a
statement or statements therefor submitted to the
Trustee monthly or annually an aggregate annual fee in
an amount which shall not exceed $0.0010 times the
number of Units outstanding as of January 1 of such
year except for a year or years in which an initial
offering period as determined by Section 4.01 of this
Indenture occurs, in which case the fee for a month is
based on the number of Units outstanding at the end of
such month (such annual fee to be pro rated for any
calendar year in which the Depositor provides service
during less than the whole of such year), but in no
event shall such compensation when combined with all
compensation received from other unit investment trusts
for which the Depositor hereunder is acting as
Depositor for providing such bookkeeping and
administrative services in any calendar year exceed the
aggregate cost to the Depositor providing services to
such unit investment trusts. Such compensation may,
from time to time, be adjusted provided that the total
adjustment upward does not, at the time of such
adjustment, exceed the percentage of the total
increase, after the date hereof, in consumer prices for
services as measured by the United States Department of
Labor Consumer Price Index entitled "All Services Less
Rent of Shelter" or similar index, if such index should
no longer be published. The consent or concurrence of
any Unit holder hereunder shall not be required for any
such adjustment or increase. Such compensation shall
be paid by the Trustee, upon receipt of invoice
therefor from the Depositor, upon which, as to the cost
incurred by the Depositor of providing services
hereunder the Trustee may rely, and shall be charged
against the Interest and Principal Accounts on or
before the Distribution Date following the Monthly
Record Date on which such period terminates. The
Trustee shall have no liability to any
Certificateholder or other person for any payment made
in good faith pursuant to this Section.
If the cash balance in the Interest and Principal
Accounts shall be insufficient to provide for amounts
payable pursuant to this Section 3.14, the Trustee
shall have the power to sell (i) Bonds from the current
list of Bonds designated to be sold pursuant to Section
5.02 hereof, or (ii) if no such Bonds have been so
designated, such Bonds as the Trustee may see fit to
sell in its own discretion, and to apply the proceeds
of any such sale in payment of the amounts payable
pursuant to this Section 3.14.
Any moneys payable to the Depositor pursuant to
this Section 3.14 shall be secured by a prior lien on
the Trust Fund except that no such lien shall be prior
to any lien in favor of the Trustee under the
provisions of Section 6.04 herein.
K. Section 5.02 of the Standard Terms and Conditions
of Trust is amended by adding the following after the second
paragraph of such section:
"Notwithstanding anything herein to the contrary,
in the event that any tender of Units pursuant to this
Section 5.02 would result in the disposition by the
Trustee of less than a whole Security, the Trustee
shall distribute cash in lieu thereof and sell such
Securities as directed by the Sponsors as required to
make such cash available.
Unit holders may redeem 2,500 Units or more of a
Trust and request a distribution in kind of (i) such
Unit holder's pro rata portion of each of the
Securities in such Trust, in whole shares, and
(ii) cash equal to such Unit holder's pro rata portion
of the Income and Principal Accounts as follows: (x) a
pro rata portion of the net proceeds of sale of the
Securities representing any fractional shares included
in such Unit holder's pro rata share of the Securities
and (y) such other cash as may properly be included in
such Unit holder's pro rata share of the sum of the
cash balances of the Income and Principal Accounts in
an amount equal to the Unit Value determined on the
basis of a Trust Fund Evaluation made in accordance
with Section 5.01 determined by the Trustee on the date
of tender less amounts determined in clauses (i) and
(ii)(x) of this Section. Subject to Section 5.05 with
respect to Rollover Unit holders, to the extent
possible, distributions of Securities pursuant to an in
kind redemption of Units shall be made by the Trustee
through the distribution of each of the Securities in
book-entry form to the account of the Unit holder's
bank or broker-dealer at the Depository Trust Company.
Any distribution in kind will be reduced by customary
transfer and registration charges."
L. Paragraph (g) of Section 6.01 of the Standard
Terms and Conditions of Trust is hereby amended by inserting
the following after the first word thereof:
"(i) the value of any Trust as shown by an
evaluation by the Trustee pursuant to Section 5.01
hereof shall be less than the lower of $2,000,000 or
20% of the total principal amount of Securities
deposited in such Trust, or (ii)"
M. Section 1.01(4) shall be amended to read as
follows:
"(4) "Portfolio Supervisor" shall mean First Trust
Advisors L.P. and its successors in interest, or any
successor portfolio supervisor appointed as hereinafter
provided."
N. Section 1.01(3) shall be amended to read as
follows:
"(3) "Evaluator" shall mean First Trust Advisors
L.P. and its successors in interest, or any successor
evaluator appointed as hereinafter provided."
O. The first sentence of Section 3.13. shall be
amended to read as follows:
"As compensation for providing supervisory
portfolio services under this Indenture, the Portfolio
Supervisor shall receive, in arrears, against a
statement or statements therefor submitted to the
Trustee monthly or annually an aggregate annual fee in
an amount which shall not exceed $0.0035 per Unit
outstanding as of January 1 of such year except for a
Trust during the year or years in which an initial
offering period as determined in Section 4.01 of this
Indenture occurs, in which case the fee for a month is
based on the number of Units outstanding at the end of
such month (such annual fee to be pro rated for any
calendar year in which the Portfolio Supervisor
provides services during less than the whole of such
year), but in no event shall such compensation when
combined with all compensation received from other
series of the Trust for providing such supervisory
services in any calendar year exceed the aggregate cost
to the Portfolio Supervisor for the cost of providing
such services."
P. Section 3.01 of the Standard Terms and Conditions
of Trust shall be replaced in its entirety with the
following:
"Section 3.01. Initial Cost. The expenses
incurred in establishing a Trust, including the cost of
the preparation and typesetting of the registration
statement, prospectuses (including preliminary
prospectuses), the indenture and other documents
relating to the Trust, printing of Certificates,
Securities and Exchange Commission and state blue sky
registration fees, the costs of the initial valuation
of the portfolio and audit of the Trust, the initial
fees and expenses of the Trustee, and legal and other
out-of-pocket expenses related thereto, but not
including the expenses incurred in the printing of
preliminary prospectuses and prospectuses, expenses
incurred in the preparation and printing of brochures
and other advertising materials and any other selling
expenses, to the extent not borne by the Depositor,
shall be borne by the Trust. To the extent the funds
in the Income and Principal Accounts of the Trust shall
be insufficient to pay the expenses borne by the Trust
specified in this Section 3.01, the Trustee shall
advance out of its own funds and cause to be deposited
and credited to the Income Account such amount as may
be required to permit payment of such expenses. The
Trustee shall be reimbursed for such advance on each
Record Date from funds on hand in the Income Account
or, to the extent funds are not available in such
Account, from the Principal Account, in the amount
deemed to have accrued as of such Record Date as
provided in the following sentence (less prior payments
on account of such advances, if any), and the
provisions of Section 6.04 with respect to the
reimbursement of disbursements for Trust expenses,
including, without limitation, the lien in favor of the
Trustee therefor and the authority to sell Securities
as needed to fund such reimbursement, shall apply to
the payment of expenses and the amounts advanced
pursuant to this Section. For the purposes of the
preceding sentence and the addition provided in clause
(4) of the first sentence of Section 5.01, the expenses
borne by the Trust pursuant to this Section shall be
deemed to have been paid on the date of the Trust
Agreement and to accrue at a daily rate over the time
period specified for their amortization provided in the
Prospectus; provided, however, that nothing herein
shall be deemed to prevent, and the Trustee shall be
entitled to, full reimbursement for any advances made
pursuant to this Section no later than the termination
of the Trust. For purposes of calculating the accrual
of organizational expenses under this Section 3.01, the
Trustee shall rely on the written estimates of such
expenses provided by the Depositor pursuant to Section
5.01."
Q. Section 5.01 of the Standard Terms and Conditions
of Trust shall be amended as follows:
(i) The second sentence of the first paragraph of
Section 5.01 shall be amended by adding the following
at the conclusion thereof: ", plus (4) amounts
representing organizational expenses paid from the
Trust less amounts representing accrued organizational
expenses of the Trust, plus (5) all other assets of the
Trust"
(ii) The following shall be added at the end of
the first paragraph of Section 5.01:
Until the Depositor has informed the Trustee
that there will be no further deposits of
Additional Securities pursuant to section 2.01(b),
the Depositor shall provide the Trustee with
written estimates of (i) the total organizational
expenses to be borne by the Trust pursuant to
Section 3.01 and (ii) the total number of Units to
be issued in connection with the initial deposit
and all anticipated deposits of additional
Securities. For purposes of calculating the Trust
Fund Evaluation and Unit Value, the Trustee shall
treat all such anticipated expenses as having been
paid and all liabilities therefor as having been
incurred, and all Units as having been issued, in
each case on the date of the Trust Agreement, and,
in connection with each such calculation, shall
take into account a pro rata portion of such
expense and liability based on the actual number
of Units issued as of the date of such
calculation. In the event the Trustee is informed
by the Depositor of a revision in its estimate of
total expenses or total Units and upon the
conclusion of the deposit of additional
Securities, the Trustee shall base calculations
made thereafter on such revised estimates or
actual expenses, respectively, but such adjustment
shall not affect calculations made prior thereto
and no adjustment shall be made in respect
thereof.
R. Section 2.03(a) of the Standard Terms and
Conditions of Trust shall be amended by adding the following
sentence after the first sentence of such section:
"The number of Units may be increased through a
split of the Units or decreased through a reverse split
thereof, as directed in writing by the Depositor, at
any time when the Depositor is the only beneficial
holder of Units, which revised number of Units shall be
recorded by the Trustee on its books. The Trustee
shall be entitled to rely on the Depositor's direction
as certification that no person other than the
Depositor has a beneficial interest in the Units and
the Trustee shall have no liability to any person for
action taken pursuant to such direction."
IN WITNESS WHEREOF, Nike Securities L.P., The Chase
Manhattan Bank (National Association) and First Trust
Advisors L.P. have each caused this Trust Agreement to be
executed and the respective corporate seal to be hereto
affixed and attested (if applicable) by authorized officers;
all as of the day, month and year first above written.
NIKE SECURITIES L.P.,
Depositor
By Xxxxxx X. Xxxxx
Senior Vice President
THE CHASE MANHATTAN
BANK (NATIONAL
ASSOCIATION),
Trustee
By Xxxxxx Xxxxxxxx
Vice President
[SEAL]
ATTEST:
Xxxxxxx X. Xxxxxxx
Second Vice President
FIRST TRUST ADVISORS
L.P., Evaluator
By Xxxxxx X. Xxxxx
Senior Vice President
FIRST TRUST ADVISORS
L.P.,
Portfolio Supervisor
By Xxxxxx X. Xxxxx
Senior Vice President
SCHEDULE A TO TRUST AGREEMENT
Securities Initially Deposited
The First Trust Special Situations Trust, Series 139
(Note: Incorporated herein and made a part hereof for
the Trust is the "Schedule of Investments" for the Trust as
set forth in the Prospectus.)
