EQUITY INV FD SEL 10 PT 1998 INTL SER 3 UK PT DEF ASSET FDS, 497, 1998-08-04

EQUITY INV FD SEL 10 PT 1998 INTL SER 3 UK PT DEF ASSET FDS
497, 1998-08-04

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<PAGE>
DEFINED ASSET FUNDSSM
- --------------------------------------------------------------------------------

EQUITY INVESTOR FUND The objective of this Defined Portfolio is total
SELECT TEN PORTFOLIO return through a combination of capital
1998 INTERNATIONAL appreciation and current dividend income.
SERIES 3 The common stocks in the Portfolio were selected
UNITED KINGDOM PORTFOLIO by following a strategy that invests for a period
(UNIT INVESTMENT TRUST) of about one year in the ten common stocks in the
- ------------------------------Financial Times Industrial Ordinary Share Index
/ / DESIGNED FOR TOTAL RETURN (the FT Index) having the highest dividend yields
/ / DEFINED PORTFOLIO OF 10 two business days prior to the date of this
HIGHEST DIVIDEND YIELDING Prospectus.
INDEX STOCKS The Portfolio may be considered speculative and
/ / SEMI-ANNUAL DIVIDEND therefore may be appropriate only for those
INCOME investors able and willing to assume higher price
risk and volatility and currency fluctuations. The
Portfolio should be considered a vehicle for
investing a portion of your assets in foreign
securities and not as a complete equity investment
program.
The value of units will fluctuate with the value
of the common stocks in the Portfolio and with
currency fluctuations and no assurance can be
given that dividends will be paid or that the
units will appreciate in value.
Unless otherwise indicated, all amounts herein are
stated in U.S. dollars computed on the basis of
the exchange rate for British pounds sterling on
the date of this prospectus.
Minimum purchase: $250.

-------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES COMMISSION NOR
HAS THE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
SPONSORS: OF THIS DOCUMENT. ANY REPRESENTATION TO THE
Merrill Lynch, CONTRARY IS A CRIMINAL OFFENSE.
Pierce, Fenner & Smith Inquiries should be directed to the Trustee at
Incorporated 1-800-221-7771.
Smith Barney Inc. Prospectus dated July 31, 1998.
PaineWebber Incorporated INVESTORS SHOULD READ THIS PROSPECTUS CAREFULLY
Dean Witter Reynolds Inc. AND RETAIN IT FOR FUTURE REFERENCE.

<PAGE>
- --------------------------------------------------------------------------------

Defined Asset FundsSM
Defined Asset Funds is America's oldest and largest family of unit investment
trusts, with over $115 billion sponsored in the last 25 years. Each Defined
Asset Fund is a portfolio of preselected securities. The portfolio is divided
into 'units' representing equal shares of the underlying assets. Each unit
receives an equal share of income and principal distributions.

Defined Asset Funds offer several defined 'distinctives'. You know in advance
what you are investing in and that changes in the portfolio are limited - a
defined portfolio. Most defined bond funds pay interest monthly - defined
income. The portfolio offers a convenient and simple way to invest - simplicity
defined.

Your financial professional can help you select a Defined Asset Fund to meet
your personal investment objectives. Our size and market presence enable us to
offer a wide variety of investments. The Defined Asset Funds family offers:

o Municipal bond portfolios
o Corporate bond portfolios
o Government bond portfolios
o Equity portfolios
o International bond and equity portfolios

The terms of Defined Funds are as short as one year or as long as 30 years.
Special defined bond funds are available including: insured funds, double and
triple tax-free funds and funds with 'laddered maturities' to help protect
against changing interest rates. Defined Asset Funds are offered by prospectus
only.

- ---------------------------------------------------
Defining the Strategy
- ---------------------------------------------------

This Select Ten Portfolio follows a simple, time-tested Strategy: buy
approximately equal amounts of the ten highest dividend-yielding stocks of the
FT Index* and hold them for about one year. At the end of the year, the
Portfolio will be liquidated and the Strategy reapplied to the FT Index to
select a new portfolio. As of two business days prior to the initial date of
deposit, Select Ten Portfolios hold approximately $834 million of the
International Strategy Stocks. The Select Ten Portfolio is designed to be part
of a longer term strategy and investors are advised to follow the Strategy for
at least three to five years. So long as the Sponsors continue to offer new
portfolios, investors will have the option to reinvest into a new portfolio at a
reduced sales charge. The Sponsors reserve the right not to offer new
portfolios.

- ---------
* The publisher of this Index is not affiliated with the Sponsors, has not
participated in any way in the creation of the Portfolio or in the selection of
stocks included in the Portfolio and has not reviewed or approved any
information included in this Prospectus.

The Strategy provides a disciplined approach to investing based on a buy and
hold philosophy, which ignores market timing and investment research and rejects
active management. The Portfolio does not reflect any investment recommendations
of the Sponsors. The Sponsors anticipate that the Portfolio will remain
unchanged over its one-year life despite any adverse developments concerning an
issuer, an industry or the economy or a stock market generally.
- ---------------------------------------------------
Defining Your Portfolio
- ---------------------------------------------------

Based upon the principal business of each issuer and current market values, the
following industries are represented in the Portfolio:
APPROXIMATE
PORTFOLIO PERCENTAGE

/ / Chemicals 20%
/ / Building & Construction 10
/ / Conglomerate 10
/ / Insurance 10
/ / Music Recording & Retailing 10
/ / Sugar 10
/ / Transportation/Marine 10
/ / Utilities/Electric 10
/ / Wines/Spirits 10

The United Kingdom Portfolio is not considered to be concentrated in any
particular industry, and all of the stocks represent United Kingdom issuers.
- ---------------------------------------------------
Defining Your Risks
- ---------------------------------------------------
The Strategy Stocks, as the 10 highest dividend yielding stocks in the FT Index,
generally share attributes that have caused them to have lower prices or higher
yields relative to the other stocks in the Index. The Strategy Stocks may, for
example, be experiencing financial difficulty, or be out of favor in the market
because of weak performance, poor earnings forecasts or negative publicity; or
they may be reacting to general market cycles. The Strategy is therefore
contrarian in nature. The Strategy Stocks are chosen solely by application of
the Strategy to determine the highest-yielding Index stocks. The Portfolio does
not reflect any investment recommendations of the Sponsors and one or more of
the stocks in the Portfolio may, from time to time, be subject to sell
recommendations from one or more of the Sponsors.

The Portfolio is not an appropriate investment for those who are not comfortable
with the Strategy. The Portfolio may not be appropriate for investors seeking
either preservation of capital or high current income, nor would the Portfolio
be appropriate for investors unable or unwilling to assume the increased risks
of higher price volatility associated with investments in international
equities. The Portfolio should be considered as a vehicle for

A-2
<PAGE>
investing a portion of an investor's assets in foreign securities and not as a
complete equity investment program.

There can be no assurance that the market factors that caused the relatively low
prices and high yields of the Strategy Stocks will change, that any negative
conditions adversely affecting the stock price will not deteriorate, that the
dividend rates on the Strategy Stocks will be maintained or that share prices
will not decline further during the life of the Portfolio, or that the Strategy
Stocks will continue to be included in the FT Index.

Unit price fluctuates with the value of the Portfolio, and the value of the
Portfolio could be affected by changes in the financial condition of the
issuers, changes in the various industries represented in the Portfolio,
movements in stock prices generally and in currency exchange rates, the impact
of purchase and sale of securities for the Portfolio (especially during the
primary offering period of units and during the rollover period) and other
factors. Also, the return on an investment in the Portfolio will be lower than
the hypothetical returns on Strategy Stocks because the Portfolio has sales
charges, brokerage commissions and expenses, purchases Strategy Stocks at
different prices and is not fully invested at all times and because of other
factors described under Performance Information.

Unlike mutual funds, the Portfolio is not actively managed and the Sponsors
receive no management fee. The adverse financial condition of an issuer or any
market movement in the price of a security will not require the sale of
securities from the Portfolio. Although the Sponsors may instruct the Trustee to
sell securities under certain limited circumstances, given the investment
philosophy of the Portfolio, the Sponsors are not likely to do so. The Portfolio
may continue to purchase or hold securities originally selected even though the
market value and yields on the securities may have changed or the securities may
no longer be included in the Index.
- ---------------------------------------------------
Defining Your Investment
- ---------------------------------------------------

PUBLIC OFFERING PRICE PER 1,000 UNITS $1,000.00

The Public Offering Price as of July 31, 1998 is based on the aggregate value of
the underlying securities and any cash held to purchase securities, divided by
the number of units outstanding times 1,000, plus the initial sales charge. The
Public Offering Price on any subsequent date will vary. The underlying
securities are valued by the Trustee on every business day on the basis of their
closing sale prices at 11:30 a.m. New York Time for the London Stock Exchange.

SALES CHARGES

The total sales charge for this investment combines an initial up-front sales
charge and a deferred sales charge that will be deducted from the net asset
value of a Portfolio monthly beginning October 1, 1998 and thereafter on the 1st
of each month through July 1, 1999.

ROLLOVER OPTION

When this Select Ten International United Kingdom Portfolio is about to
terminate, you may have the option to roll your proceeds into the next portfolio
of the then current Strategy Stocks. If you hold your units with one of the
Sponsors and notify your financial consultant by August 6, 1999, your units will
be redeemed, and certain distributed securities plus the proceeds from the sale
of the remaining securities will be reinvested in units of a new Select Ten
International United Kingdom Portfolio, if available. If you decide not to roll
over your proceeds, you will receive a cash distribution (or, if you so elect,
an in-kind distribution) after the Fund terminates. Of course you can sell or
redeem your Units at any time prior to termination.

SEMI-ANNUAL DISTRIBUTIONS

You will receive distributions of any dividend income, net of expenses, on the
25th of January and June, 1999, if you own units on the 10th of those months.

REINVESTMENT OPTION

You can elect to automatically reinvest your distributions into additional units
of the Portfolio subject only to the deferred sales charge remaining at the time
of reinvestment. Reinvesting helps to compound your income for a greater total
return.

U.S. TAXES

In the opinion of counsel, for U.S. tax purposes, you will be considered to have
received all the dividends paid on your pro rata portion of each security in the
Portfolio when those dividends are received (or deemed to be received) by the
Portfolio, even though the dividend payments may be subject to withholding taxes
or may be used to pay expenses of the Portfolio and regardless of whether you
reinvest your dividends in the Portfolio. (See U.S. Taxation in Part B.)

U.K. TAXES

The Portfolio will report as gross income each investor's pro rata share of
dividends earned by the Portfolio grossed-up to reflect the payment of certain
U.K. taxes by the relevant U.K. company. The U.K Inland Revenue have approved a
special procedure under which the Trustee may claim a refund of a portion of
such U.K. taxes under the U.S.-U.K. Treaty on behalf of investors. (See United
Kingdom Taxation in Part B.)

TAX BASIS REPORTING

The proceeds received when you sell this investment will reflect the deduction
of the deferred sales charge and, after the initial period, the charge for
organizational expenses. In addition, the annual statement and the relevant tax
reporting forms you receive at year-end will be based upon the amount paid to
you (net of the deferred sales charge and the charge for organizational
expenses). Accordingly, you should not increase your basis in your units by the
deferred sales charge and the charge for organizational expenses. (See U.S.
Taxation in Part B.)

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TERMINATION DATE

The Portfolio will terminate by September 10, 1999. The final distribution will
be made within a reasonable time afterward. The Portfolio may be terminated
earlier if its value is less than 40% of the value of the securities when
deposited.

SPONSORS' PROFIT OR LOSS

The Sponsors' profit or loss from the Portfolio will include applicable sales
charges, fluctuations in the Public Offering Price or secondary market price of
units and a gain or loss on the initial and subsequent deposits of securities.
Loss to the Sponsors on deposit of the Securities was $1,365.56. (See Defined
Portfolio; Sponsors' and Underwriters' Profits in Part B.)
- ---------------------------------------------------
Defining Your Costs
- ---------------------------------------------------

SALES CHARGES

First-time investors pay a maximum sales charge of 2.75% of the offering price,
of which $17.50 per 1,000 units is deferred. For example, on a $1,000
investment, 2.75% less $17.50 (or about 1%) is deducted when you buy and the
remaining $990 is invested in the Strategy Stocks. The initial sales charge is
reduced on purchases of $50,000 or more, as described in Part B. In addition, a
deferred sales charge of $1.75 per 1,000 units will be deducted from a
Portfolio's net asset value each month over the last ten months of the
Portfolio's life ($17.50 total). This deferred method of payment keeps more of
your money invested over a longer period of time. If you roll the proceeds of
your investment into the new portfolio, you will not be subject to the 1%
initial charge, just the $17.50 deferred fee. Although this is a unit investment
trust rather than a mutual fund, the following information is presented to
permit a comparison of fees and an understanding of the direct or indirect costs
and expenses that you pay.

As a %
of Initial
Public
Offering Amount per
Price 1,000 Units
----------- -----------
Initial Sales Charge 1.00% $ 10.00
Deferred Sales Charge per
Year 1.75 17.50
----------- -----------
Maximum Sales Charge 2.75% $ 27.50
----------- -----------
----------- -----------
Maximum Sales Charge on
Reinvested Dividends 1.05% $ 10.50

ESTIMATED ANNUAL OPERATING EXPENSES

AS A % OF AMOUNT PER
NET ASSETS 1,000 UNITS
----------- -----------
Trustee's Fee .091% $ 0.90
Portfolio Supervision,
Bookkeeping and
Administrative Fees .045% $ 0.45
Other Operating Expenses .112% $ 1.11
----------- -----------
TOTAL .248% $ 2.46

Investors will bear all or a portion of the expenses incurred in organizing the
Portfolio--including costs of preparing the registration statement, the trust
indenture and other closing documents, any foreign trading costs, registering
units with the SEC and the states and the initial audit of the Portfolio--as is
common for mutual funds. Estimated organization costs shown below are included
in the public offering price and will be deducted from the assets of the
Portfolio as of the close of the initial offering period.

Amount per
1,000 Units
-----------
Estimated Organization Costs $ 2.34

These estimates do not include the costs of purchasing and selling the
underlying Strategy Stocks.

COSTS OVER TIME

You would pay the following cumulative expenses on a $1,000 investment, assuming
a 5% annual return on the investment throughout the indicated periods and
redemption at the end of the period:

1 Year 3 Years 5 Years 10 Years
$33 $80 $129 $266

Although the Portfolio has a term of only one year and is a unit investment
trust rather than a mutual fund, this information is presented to permit a
comparison of fees, assuming the principal amount and distributions are rolled
over each year into a new Portfolio subject only to the deferred sales charge
and fund expenses.

This example assumes reinvestment of all dividends and distributions and uses a
5% annual rate of return as mandated by SEC regulations applicable to mutual
funds. For purposes of the example, the deferred sales charge imposed on
reinvestment of dividends is not reflected until the year following payment of
the dividend; the cumulative expenses would be higher if sales charges on
reinvested dividends were reflected in the year of reinvestment.

The example should not be considered a representation of past or future expenses
or annual rates of return; the actual expenses and annual rates of return may be
more or less than the example. The estimated reductions to the repurchase and
cash redemption prices in the secondary market to recoup the costs of
liquidating securities to meet redemption shown below have not been reflected.

REDEEMING OR SELLING YOUR INVESTMENT

You may sell or redeem your units at any time prior to the termination of the
Portfolio. Your price will be based on the then current net asset value. The
redemption and secondary market repurchase price as of July 31, 1998 was $972.50
per 1,000 units ($27.50 per 1,000 units less than the Public Offering Price).
This price reflects deductions of the deferred sales charge which declines over
the last ten months of the Portfolio ($17.50 initially). As of the close of the
initial public offering period, these prices will be reduced to reflect the
estimated organization costs shown above. If you sell your units before the
termination of the Portfolio, you will pay the remaining balance of the deferred
sales charge.

In addition, after the initial offering period, the repurchase and cash
redemption prices for units will be further reduced to reflect the costs of
liquidating securities to meet the redemption, currently estimated at $1.99 per
1,000 units. If you reinvest in the new Portfolio, you will pay your share of
any brokerage commissions on the sale of underlying securities when your units
are liquidated during the rollover.

A-4
<PAGE>
- --------------------------------------------------------------------------------
Defined Portfolio
- --------------------------------------------------------------------------------

Equity Investor Fund
Select Ten Portfolio 1998 International Series 3 July 31, 1998
United Kingdom Portfolio

PRICE
PER SHARE COST
PERCENTAGE CURRENT TO PORTFOLIO TO PORTFOLIO
OF PORTFOLIO DIVIDEND YIELD IN IN U.S.
NAME OF ISSUER (1) (2) U.S. DOLLARS DOLLARS (3)
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1. BTR PLC 10.24% 6.23% $ 2.521 $ 32,012.53
2. Allied Domecq PLC 9.97 4.42 9.166 31,164.67
3. Blue Circle Industries PLC 9.94 4.35 5.455 31,091.43
4. Imperial Chemical Industries PLC 9.93 4.05 12.931 31,033.73
5. BOC Group PLC 9.83 3.95 12.800 30,719.46
6. Tate and Lyle PLC 9.96 3.48 7.988 31,151.58
7. Scottish Power PLC 9.94 3.44 9.714 31,086.11
8. EMI Group PLC 10.07 3.33 7.873 31,492.03
9. Peninsular & Oriental Steam
Navigation
Company 10.01 3.19 15.648 31,295.62
10. Royal & Sun Alliance Insurance
Group PLC 10.11 3.15 10.901 31,613.16
-------------- --------------
100.00% $ 312,660.32
-------------- --------------
-------------- --------------

</TABLE>
- ----------------------------
(1) Based on Cost to Portfolio in U.S. dollars.
(2) Current Dividend Yield for each security was calculated by adding the most
recent interim and final dividends declared on the security and dividing the
result by its market value as of the close of trading on July 31, 1998.
(3) Valuation by the Trustee made on the basis of closing sale prices at the
evaluation time on July 31, 1998, the initial date of deposit, converted
into U.S. dollars on the offer side of the exchange rate at the evaluation
time on that date. The value of the Securities on any subsequent business
day will vary.

----------------------------

The securities were acquired on July 31, 1998 and are represented entirely by
contracts to purchase the securities. Any of the Sponsors may have acted as
underwriters, managers or co-managers of a public offering of the securities in
this Fund during the last three years. Affiliates of the Sponsors may serve as
specialists in the securities in this Fund on one or more stock exchanges and
may have a long or short position in any of these securities or in options on
any of them, and may be on the opposite side of public orders executed on the
floor of an exchange where the securities are listed. An officer, director or
employee of any of the Sponsors may be an officer or director of one or more of
the issuers of the securities in the Fund. A Sponsor may trade for its own
account as an odd-lot dealer, market maker, block positioner and/or arbitrageur
in any of the securities or in options on them. Any Sponsor, its affiliates,
directors, elected officers and employee benefits programs may have either a
long or short position in any securities or in options on them.

A-5
<PAGE>
- --------------------------------------------------------------------------------
Past Performance of Prior United Kingdom Portfolios
- --------------------------------------------------------------------------------

Select United Kingdom Portfolios, first available in 1993, are now offered in
various cycles -- or Series -- each starting at different times during a year.
The following table shows the actual performance of each Portfolio of certain of
these Series. The table also shows the Average Annual Total Return and the
Cumulative Total Return for these Series. These past performance returns reflect
an investment made in the initial Portfolio of each Series and assume annual
rollovers into successor Portfolios of the same Series. Past performance of the
Portfolios and the Series is no guarantee of future results of the Select Ten
Strategy or of any Portfolio currently offered.

ANNUALIZED
----------------------------------------- CUMULATIVE
DIVIDEND TOTAL TOTAL
SERIES A TERM YIELD(1) APPRECIATION(2) RETURN(3) RETURN
- -------------------- ------------------ --------- ------------ ------------ ---------
<S> <C> <C> <C> <C> <C>
1994 1/5/94-2/3/95 3.28% -7.27% -3.99%
1995 1/9/95-2/23/96 3.94 1.94 5.88
1996 1/22/96-2/28/97 4.26 -1.48 2.78
1997 1/27/97-2/27/98 6.04 10.93 16.97
Average Annual
Total Return(4) 1/5/94-6/30/98 -- -- 8.80
Cumulative
Total Return 1/5/94-6/30/98 -- -- -- 45.98%*
SERIES B
- --------------------
1993** 6/21/93-7/22/94 3.61 10.34 13.95
1994 5/6/94-6/16/95 4.61 3.38 7.99
1995 5/10/95-6/28/96 3.88 -14.05 -10.17
1996 5/20/96-6/27/97 4.74 13.89 18.63
1997 5/27/97-6/30/98 7.57 23.99 31.56
Average Annual
Total Return(4) 6/21/93-6/30/98 -- -- 10.95
Cumulative
Total Return 6/21/93-6/30/98 -- -- -- 68.60%*
SERIES C
- --------------------
1993 9/28/93-10/28/94 3.95 5.74 9.69
1994 9/7/94-10/13/95 4.32 -6.58 -2.26
1995 9/12/95-10/31/96 4.70 -3.42 1.28
1996 9/17/96-10/24/97 6.19 15.96 22.15
Average Annual
Total Return(4) 9/28/93-6/30/98 -- -- 10.99
Cumulative
Total Return 9/28/93-6/30/98 -- -- -- 64.21%*
</TABLE>

- ----------------------------

(1) Dividends paid on the securities to the Portfolio less ongoing expenses,
divided by maximum initial public offering price.

(3) Appreciation plus Dividend Yield. Reflects reinvestment of dividends,
deduction of maximum applicable sales charges and ongoing expenses, but no
adjustment for taxes payable.

(4) Average Annual Total Return for a Series includes the brokerage commissions
paid in selling securities received in kind on annual rollovers and the
waiver of any up-front sales charge on those rollovers.

* These figures are not annualized.

** 1993 Series A rolled into 1994 Series B.

A-6
<PAGE>
- --------------------------------------------------------------------------------
Past Performance of Prior United Kingdom Portfolios (continued)
- --------------------------------------------------------------------------------

ANNUALIZED
----------------------------------------- CUMULATIVE
DIVIDEND TOTAL TOTAL
SERIES 3 TERM YIELD(1) APPRECIATION(2) RETURN(3) RETURN
- -------------------- ------------------ --------- ------------ ------------ ---------
<S> <C> <C> <C> <C> <C>
1996 7/22/96-8/29/97 6.47% 11.54% 18.01%
Average Annual
Total Return(4) 7/22/96-6/30/98 -- -- 29.49
Cumulative
Total Return 7/22/96-6/30/98 -- -- -- 65.09%*

SERIES 5
- --------------------
1996 11/1/96-12/12/97 6.62 11.88 18.50
Average Annual
Total Return(4) 11/1/96-6/30/98 -- -- 22.19
Cumulative
Total Return 11/1/96-6/30/98 -- -- -- 39.48%*

SERIES 1
- --------------------
1997 2/25/97-3/27/98 6.80 22.45 29.25
Average Annual
Total Return(4) 2/25/97-6/30/98 -- -- 21.71
Cumulative
Total Return 2/25/97-6/30/98 -- -- -- 30.18%*

</TABLE>
- ----------------------------

(1) Dividends paid on the securities to the Portfolio less ongoing expenses,
divided by maximum initial public offering price.

(2) Represents the difference between initial unit price and redemption or
liquidation price on the ending date (reflecting payment of deferred sales
charges, brokerage commissions paid by the Portfolio and, beginning with
1995 Series B, organization expenses, and assumes reinvestment of dividends
on the distribution dates), divided by the maximum initial public offering
price.
(3) Appreciation plus Dividend Yield. Reflects reinvestment of dividends,
deduction of maximum applicable sales charges and ongoing expenses, but no
adjustment for taxes payable.

* These figures are not annualized.

** 1993 Series A rolled into 1994 Series B.

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- --------------------------------------------------------------------------------
Hypothetical Performance Information--FT Strategy
- --------------------------------------------------------------------------------

Select Ten United Kingdom Portfolios are based on a strategy of investing equal
amounts in the 10 highest dividend-yielding stocks ('Strategy Stocks') in the FT
Index each year. Although the Strategy Stocks underperformed the FT Index in six
of the last 20 years (eight years if Portfolio sales charges and expenses were
deducted from Strategy Stock performance), their total return over the entire
period outperformed the FT Index. This is why the Sponsors recommend following
the Strategy for at least three to five years. The results below are
hypothetical for the following reasons: None of the figures reflects any
brokerage commissions which investors in the Portfolio bear. Portfolio
performance will also differ from the hypothetical performance of Strategy
Stocks because the Select Ten United Kingdom Portfolios are established at
various times during a year, Portfolios may not be fully invested at all times
or equally weighted in all 10 stocks, and their stocks are normally purchased or
sold at prices and currency exchange rates different from the closing prices and
currency exchange rates used in buying and selling Portfolio units. Past
performance is no guaranty of future results of the Strategy or any Select Ten
United Kingdom Portfolio.
COMPARISON OF DIVIDENDS, APPRECIATION AND TOTAL RETURN
(STRATEGY STOCK FIGURES REFLECT CONVERSION INTO U.S. DOLLARS AT APPLICABLE
CURRENCY EXCHANGE RATES AND DEDUCTION OF
SALES CHARGES AND FUND EXPENSES, BUT NOT BROKERAGE COMMISSIONS)

FT STRATEGY STOCKS(1) FT INDEX*
---------------------------------------------------------- ----------------------------------------------------------
ACTUAL DIVIDEND TOTAL ACTUAL DIVIDEND TOTAL
YEAR APPRECIATION(2) YIELD(3) RETURN(4) APPRECIATION(2) YIELD(3) RETURN(4)
- ---- -------------- ---------------------- -------------- -------------- ---------------------- --------------
<S> <C> <C> <C> <C> <C> <C>
1978 4.59% 10.11% 14.70% 3.57% 6.35% 9.92%
1979 -7.61 10.11 2.50 -3.94 7.53 3.59
1980 14.99 13.26 28.25 22.57 9.20 31.77
1981 -16.06 7.36 -8.70 -10.36 5.06 -5.30
1982 32.73 9.59 42.32 -4.41 4.83 0.42
1983 32.87 7.49 40.35 16.60 5.34 21.94
1984 -2.62 5.95 3.33 -2.26 4.41 2.15
1985 68.33 8.88 77.20 48.25 6.49 54.74
1986 24.96 6.13 31.09 19.14 5.22 24.36
1987 39.24 7.21 46.45 32.97 6.02 38.99
1988 3.53 5.79 9.31 1.62 5.12 6.74
1989 20.65 6.23 26.87 17.57 5.23 22.80
1990 0.19 6.95 7.14 4.31 5.98 10.29
1991 7.09 7.47 14.56 9.36 5.29 14.65
1992 -3.19 5.28 2.09 -6.33 4.00 -2.33
1993 30.22 5.74 35.96 14.24 4.16 18.40
1994 -1.32 4.64 3.32 -2.43 4.32 1.89
1995 3.54 5.23 8.76 13.07 4.56 17.63
1996 6.36 5.91 12.27 15.33 4.72 20.05
1997 3.16 6.87 10.03 12.38 4.60 16.98
1998
(through
6/30) 16.44 3.71 20.14 16.83 2.00 18.82
</TABLE>

Changes in the exchange rates of the pound sterling relative to the U.S. dollar
affected these figures significantly in certain years. These changes ranged from
minus 25% in 1981 and 1984 to plus 21% in 1987, and averaged minus 1.65% over
the last 20 years. See Foreign Currency Exchange Rates table under Risk Factors
in Part B.
- ----------------------------
* Source: Datastream International, Inc. The Sponsors have not independently
verified these data, but they have no reason to believe these data are
incorrect in any material respect.

(1) The FT Strategy Stocks for any given year were selected by ranking the
dividend yields for each of the stocks in the FT Index as of the beginning
of that year, as provided by Datastream International Inc. The yields were
generally computed by adding together the interim and final dividends for
each of the stocks (these companies generally pay one interim and a final
dividend per fiscal year) declared in the preceding year divided by that
stock's market value on the first trading day that year on the London Stock
Exchange.

(2) Appreciation for the Strategy Stocks is calculated by subtracting the market
value of these stocks at the opening value on the first trading day on the
London Stock Exchange in a given year from the market value of those stocks
at the closing value on the last trading day in the year, and dividing the
result by the market value of the stocks at the opening value on the first
trading day in that year. Appreciation for the FT Index is calculated by
subtracting the opening value of the FT Index on the first trading day in
each year from the closing value of the FT Index on the last trading day in
the year, and dividing the result by the opening value of the FT Index on
the first trading day in that year.

(3) Actual Dividend Yield for the FT Strategy Stocks is calculated by adding the
total dividends received on the stocks in the year and dividing the result
by the market value of the stocks on the first trading day in that year.
Actual Dividend Yield for the FT Index is calculated by taking the total
dividends credited to the FT Index and dividing the result by the opening
value of the FT Index on the first trading day of the year.

(4) Total Return represents the sum of Appreciation and Actual Dividend Yield.
Individual year Total Returns do not take into consideration any
reinvestment of dividend income.

A-8
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS

The Sponsors, Trustee and Holders of Equity Investor Fund, Select Ten Portfolio
1998 International Series 3, United Kingdom Portfolio, Defined Asset Funds (the
'Fund'):

We have audited the accompanying statement of condition and the related
portfolio included in the prospectus of the Fund as of July 31, 1998. This
financial statement is the responsibility of the Trustee. Our responsibility is
to express an opinion on this financial statement based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. Our procedures included
confirmation of the irrevocable letter of credit deposited for the purchase of
securities, as described in the statement of condition, with the Trustee. An
audit also includes assessing the accounting principles used and significant
estimates made by the Trustee, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.

In our opinion, the financial statement referred to above presents fairly, in
all material respects, the financial position of the Fund as of July 31, 1998 in
conformity with generally accepted accounting principles.

DELOITTE & TOUCHE LLP
New York, N.Y.
July 31, 1998

STATEMENT OF CONDITION AS OF JULY 31, 1998

TRUST PROPERTY
Investments--Contracts to purchase Securities(1).........$ 312,660.32
--------------------
Total............................................$ 312,660.32
--------------------
--------------------
LIABILITY AND INTEREST OF HOLDERS
Reimbursement of Sponsors for Organization
Expenses(2)........................................$ 739.01
--------------------
Subtotal............................................. 739.01
--------------------
Interest of Holders of 315,818 Units of fractional
undivided interest outstanding(3):
Cost to investors(4)................................... 315,818.00
Gross underwriting commissions and organization
expenses(5)(2)....................................... (3,896.69)
--------------------
Subtotal............................................. 311,921.31
--------------------
Total............................................$ 312,660.32
--------------------
--------------------

- ------------

(1) Aggregate cost to the Fund of the securities listed under Defined
Portfolio based on the U.S. dollar offer side value of the relevant exchange
rate determined by the Trustee at the evaluation time on July 31, 1998. The
contracts to purchase securities are collateralized by an irrevocable letter of
credit which has been issued by DBS Bank, New York Branch, in the amount of
$314,025.88 and deposited with the Trustee. The amount of the letter of credit
includes $312,660.32 for the purchase of securities.
(2) A portion of the Public Offering Price consists of cash or securities
in an amount sufficient to pay for all or a portion of the costs incurred in
establishing the Trust. These costs have been estimated at $2.34 per 1,000
Units. A distribution will be made as of the close of the initial offering
period to an account maintained by the Trustee from which the organizational
expenses obligation of the investors to the Sponsors will be satisfied.
(3) Because the value of securities at the evaluation time on the Initial
Date of Deposit may differ from the amounts shown in this statement of
condition, the number of Units offered on the business day following the Initial
Date of Deposit will be adjusted from the initial number of Units to maintain
the $1,000 per 1,000 Units offering price only for that day. The Public Offering
Price on any subsequent business day will vary.
(4) Aggregate public offering price computed on the basis of the U. S.
dollar value of the underlying securities based on the U.S. dollar offer side
value of the relevant exchange rate at the evaluation time on July 31, 1998.
(5) Assumes the maximum initial sales charge per 1,000 units of 1.00% of
the Public Offering Price. A deferred sales charge of $1.75 per 1,000 Units per
month is payable on October 1, 1998 and thereafter on the 1st day of each month
through July 1, 1999. Distributions will be made to an account maintained by the
Trustee from which the deferred sales charge obligation of the investors to the
Sponsors will be satisfied. If units are redeemed prior to July 1, 1999, the
remaining portion of the distribution applicable to such units will be
transferred to such account on the redemption date.

A-9
<PAGE>
DEFINED ASSET FUNDSSM
PROSPECTUS--PART B
EQUITY INVESTOR FUND SELECT TEN PORTFOLIO--INTERNATIONAL SERIES
UNITED KINGDOM PORTFOLIO
FURTHER INFORMATION REGARDING THE FUND MAY BE OBTAINED
BY WRITING OR CALLING THE TRUSTEE AT THE ADDRESS AND
TELEPHONE NUMBER SET FORTH ON THE BACK COVER OF THIS PROSPECTUS.

Index

PAGE
----
Fund Description........................... 1
Risk Factors............................... 3
How to Buy Units........................... 5
How to Redeem or Sell Units................ 6
Trust Termination.......................... 7
Rollover................................... 8
Income, Distributions and Reinvestment..... 9
PAGE
----
Portfolio Expenses......................... 9
Taxes...................................... 10
Records and Reports........................ 14
Trust Indenture............................ 14
Miscellaneous.............................. 15
Exchange Option............................ 17
Supplemental Information................... 17

FUND DESCRIPTION

THE STRATEGY

Simple strategies can sometimes be the most effective. The Fund seeks total
return by acquiring the ten highest yielding stocks in the FT Index, as of the
date indicated in Part A, after giving effect to any forthcoming changes to the
Index announced prior to those dates, and holding them for about one year. This
investment strategy is based on three time-tested investment principles: time in
the market is more important than timing the market; the stocks to buy are the
ones everyone else is selling; and dividends can be an important part of total
return. Defined Asset Funds can make some of them available to investors with
the Select Ten International Portfolios. Global markets can move in different
directions. While some markets may be experiencing rapid growth, others may be
in decline. These markets can offer attractive growth opportunities. An
investment in the Fund can be cost-efficient, avoiding the odd-lot costs of
buying small quantities of securities directly. Purchasing a portfolio of these
stocks as opposed to one or two stocks offers greater diversification. There is
only one investment decision and two semi-annual dividends. Investment in a
number of companies with high dividends relative to their stock prices is
designed to increase the Portfolio's potential for higher total returns. The
Portfolio's return will consist of a combination of capital appreciation and
current dividend income. The Portfolio will terminate in about one year, when
investors may choose to either receive the distribution in cash or reinvest in
the next Series (if available) at a reduced sales charge. There can be no
assurance that the dividend rates on the selected stocks will be maintained.
Reduction or elimination of a dividend could adversely affect the stock price as
well.

The FT Index. The FT Index began as the Financial News Industrial Ordinary
Share Index in London in 1935 and became the Financial Times Industrial Ordinary
Share Index in 1947. This Index is an unweighted average of the share prices of
selected companies, which are highly capitalized, major factors in their
industries; their stocks are widely held by individuals and institutional
investors. The following are the stocks currently represented in the FT Index:

1
<PAGE>
Allied Domecq PLC
ASDA Group PLC
The BOC Group PLC
BTR PLC
Blue Circle Industries PLC
The Boots Company PLC
The British Petroleum Company
PLC
British Telecommunications PLC
BG PLC
British Airways PLC
Cadbury Schweppes PLC
Diageo PLC
The General Electric Company PLC
Glaxo Wellcome PLC
GKN PLC
Granada PLC
Imperial Chemical Industries PLC
Lucas Industries PLC
Lloyds TSB PLC
Marks & Spencer PLC
National Westminster Bank PLC
The Peninsular & Oriental Steam
Navigation Company
Prudential Corporation PLC
Reuters Holdings PLC
Royal & Sun Alliance Insurance
Group PLC
Scottish Power PLC
SmithKline Beecham PLC
Tate & Lyle PLC
Thorn EMI PLC
Vodafone Group PLC

PORTFOLIO SELECTION

The Fund consists of ten common stocks in the FT Index having the highest
dividend yield as of the date indicated in Part A. 'Highest dividend yield'
means the yield for each Security calculated by adding the most recent interim
and final dividends declared on that Security and dividing the result by the
market value of that Security. This rate is historical and there is no assurance
that any dividends will be declared or paid in the future on the Securities. No
leverage or borrowing is used nor does the Portfolio contain other kinds of
securities to enhance yield.

The Strategy selection process is a straightforward, objective, mathematical
application that ignores any subjective factors concerning an issuer in the
related index, an industry or the economy generally. The application of the
Strategy may cause the Portfolio to own a stock that the Sponsors do not
recommend for purchase and, in fact, the Sponsors may have sell recommendations
on a number of the stocks in the Portfolio at the time the stocks are selected
for inclusion in the Portfolio. Various theories attempt to explain why a common
stock is among the ten highest yielding stocks in an Index at any given time:
the issuer may be in financial difficulty or out of favor in the market because
of weak earnings or performance or forecasts or negative publicity;
uncertainties relating to pending or threatened litigation or pending or
proposed legislation or government regulation; the stock may be a cyclical stock
reacting to national or international economic developments; or the market may
be anticipating a reduction in or the elimination of the company's dividend.
Some of the foregoing factors may be relevant to only a segment of an issuer's
overall business yet the publicity may be strong enough to outweigh otherwise
solid business performance. In addition, companies in certain industries have
historically paid high dividends.

The deposit of the Securities in the Portfolio on the initial date of
deposit established a proportionate relationship among the number of shares of
each Security in the Portfolio. During the 90-day period following the initial
date of deposit the Sponsors may deposit additional Securities in order to
create new Units, maintaining to the extent practicable that original
proportionate relationship. Deposits of additional Securities subsequent to the
90-day period must generally replicate exactly the proportionate relationship
among the number of shares of each Security in the Portfolio at the end of the
initial 90-day period. The ability to acquire each Security at the same time
will generally depend upon the Security's availability and any restrictions on
the purchase of that Security under the federal securities laws or otherwise.

Additional Units may also be created by the deposit of cash (including a
letter of credit) with instructions to purchase additional Securities. This
practice could cause both existing and new investors to experience a dilution of
their investments and a reduction in their anticipated income because of price
fluctuations in the Securities between the time of the cash deposit and the
actual purchase of the additional Securities and because the associated
brokerage fees will be an expense of the Portfolio. To minimize the risk of
price fluctuations when purchasing Securities, the Portfolio will try to
purchase Securities as close to the Evaluation Time or at prices as close to the
evaluated prices as possible and may purchase Securities on exchanges other than
the London Stock Exchange. The Portfolio may also enter into program trades with
unaffiliated broker/dealers, which could have the effect of increasing brokerage
commissions while reducing market risk.

Because the Portfolio in a Defined Asset Fund is a preselected portfolio,
you know the securities before you invest. Of course, the Portfolio will change
somewhat over time, as Securities are purchased upon creation of additional
Units, as Securities are sold to meet Unit redemptions or in other limited
circumstances.

2
<PAGE>
PORTFOLIO SUPERVISION

The Portfolio follows a buy and hold investment strategy in contrast to the
frequent portfolio changes of a managed fund based on economic, financial and
market analyses. Although the Portfolio is regularly reviewed, because of the
Strategy the Portfolio is unlikely to sell any of the Securities other than to
satisfy redemptions of units, or to cease buying additional shares in connection
with the issuance of Additional Units. More specifically, adverse developments
concerning a Security including the adverse financial condition of the issuer, a
failure to maintain a current dividend rate, the institution of legal
proceedings against the issuer, a default under certain documents materially and
adversely affecting the future declaration of dividends, or a decline in the
price or the occurrence of other market or credit factors (including a public
tender offer or a merger or acquisition transaction) that might otherwise make
retention of the Security detrimental to the interest of investors, will
generally not cause the Portfolio to dispose of a Security or cease buying it.
Furthermore, the Portfolio will likely continue to hold a Security and purchase
additional shares notwithstanding its ceasing to be included among the ten
highest dividend yielding stocks in the FT Index or even its deletion from that
Index.

RISK FACTORS

An investment in the Portfolio entails certain risks, including the risk
that the value of your investment will decline if the financial condition of the
issuers of the Securities becomes impaired or if the general condition of the
relevant stock market worsens and the risk that holders of common stocks have
generally inferior rights to receive payments from the issuer in comparison with
the rights of creditors of, or holders of debt obligations or preferred stocks
issued by, the issuer. 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 provided by debt securities. Common stocks in
general may be 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. The
Sponsors cannot predict the direction or scope of any of these factors.

Foreign Issuers. Investments in securities of foreign issuers involve risks
that are different from investments in securities of domestic issuers. These
risks may include future political and economic developments, the possibility of
withholding taxes, exchange controls or other governmental restrictions on the
payment of dividends, less publicly available information and the absence of
uniform accounting, auditing and financial reporting standards, practices and
requirements.

The information set forth below has been extracted from various governmental
and private publications, but no representation can be made as to its accuracy;
furthermore, no representation is made that any correlation exists between the
economy of the United Kingdom and the value of any Securities held by the
Portfolio.

UNITED KINGDOM PORTFOLIO RISK FACTORS

The United Kingdom Portfolio contains common stocks of British companies
engaged in such industries as banking, the chemical industry, the building and
construction industry, the transportation industry, telecommunications and
insurance. Many of these industries are subject to extensive government
regulation which may have a materially adverse effect on the performance of
their securities.

The economy of the United Kingdom is focused upon the private services
sector, which includes the wholesale and retail sector, banking, finance,
insurance, and tourism. Services as a whole account for a majority of the United
Kingdom's gross national product and make a significant contribution to the
country's balance of payments. In addition, the United Kingdom, as a member of
the European Union (the 'EU'), formerly known as the European Community, is
subject to the effects of the recent rapid political and social change
throughout Europe although the extent and nature of future economic development
in the United Kingdom and Europe and the impact of such development upon the
value of the securities in the United Kingdom Portfolio is impossible to
predict.

Currency Exchange Rates. Because securities of non-U.S. issuers generally
pay dividends and trade in foreign currencies, there is the risk that the U.S.
dollar value of these securities will vary with fluctuations in foreign exchange
rates. Currencies are generally traded by leading international commercial banks
and institutional investors. From time to time, central banks in a number of
countries also are major buyers and sellers of foreign currencies, mostly to
prevent or reduce substantial exchange rate fluctuations.

3
<PAGE>
The following table shows fluctuations in the value of the British pound
relative to the U.S. dollar in the past 20 years.
CHANGES IN FOREIGN CURRENCY EXCHANGE RATES

RANGE OF %
FLUCTUATIONS CHANGE IN
U.S. DOLLAR/U.K. U.K. POUND
POUND STERLING/
PERIOD STERLING* U.S. DOLLAR**
------------- ------------------- -------------
1978 2.095-1.807 6.32
1979 2.332-1.979 8.52
1980 2.452-2.134 6.75
1981 2.427-1.763 -25.00
1982 1.933-1.593 -18.18
1983 1.623-1.415 -11.30
1984 1.492-1.158 -25.43
1985 1.494-1.044 19.94
1986 1.555-1.377 2.03
1987 1.886-1.468 21.21
1988 1.896-1.663 -3.48
1989 1.823-1.500 -12.04
1990 1.976-1.595 16.37
1991 1.999-1.602 -3.24
1992 2.004-1.505 -23.44
1993 1.590-1.417 -2.36
1994 1.637-1.461 5.46
1995 1.641-1.530 -0.77
1996 1.714-1.493 9.32
1997 1.711-1.578 -4.01
1998
(through 6/30) 1.690-1.610 1.40

- --------------
* DRI/McGrawHill.
** Ibbotson Associates.

The Trustee is required to conduct the Portfolio's foreign currency
conversions either on a spot (i.e., cash) or forward foreign exchange basis,
whichever will synchronize the currency conversions as exactly as practicable
with the settlement dates of the relevant foreign stock or with the dividend
distribution dates of the Portfolio, as the case may be. Foreign currency
conversions are generally conducted on a principal basis and foreign exchange
dealers realize a profit based upon the difference between the price at which
they are willing to buy a particular currency (bid price) and the price at which
they are willing to sell the currency (offer price). The cost to the Portfolio
of engaging in these foreign currency conversions also varies with such factors
as the currency involved, the length of the contract period and the market
conditions then prevailing. Portfolio evaluations include the cost of buying or
selling a forward foreign exchange contract in the relevant currency to
correspond to the settlement period for purchases and redemptions of Units.

Exchange Controls. At the present time the Sponsors do not believe that any
of the Securities is subject to exchange control restrictions which would
materially interfere with payment to the Portfolio of amounts due on the
Securities. There can be no assurance that exchange control regulations might
not be adopted in the future that would adversely affect payments to the
Portfolio. In addition, the adoption of exchange control regulations or other
legal restrictions could have an adverse impact on the marketability of
international securities in the Portfolio and on the ability of the Portfolio to
satisfy redemptions.

Liquidity. Sales of foreign securities by a Portfolio in United States
securities markets are ordinarily subject to severe restrictions and will
generally be made only in foreign securities markets. Securities may be traded
in foreign countries where the securities markets are not as developed or
efficient and may not be as liquid as those in the United States. A foreign
market's liquidity might become impaired as a result of economic or political
turmoil in a country in whose currency a Portfolio had a substantial portion of
its assets invested, or should relations between the United States and such
foreign country deteriorate markedly. Additionally, the principal trading market
for the Securities, even if otherwise listed, may be the over-the-counter market
in which liquidity will depend on whether dealers will make a market in the
Securities.

4
<PAGE>
LITIGATION AND LEGISLATION

The Sponsors do not know of any pending litigation as of the initial date of
deposit that might reasonably be expected to have a material adverse effect on
the Portfolio, although pending litigation may have a material adverse effect on
the value of Securities in the Portfolio. In addition, at any time after the
initial date of deposit, litigation may be initiated on a variety of grounds, or
legislation may be enacted, affecting the Securities in the Portfolio or the
issuers of the Securities. Changing approaches to regulation may have a negative
impact on certain companies represented in the Portfolio. There can be no
assurance that future litigation, legislation, regulation or deregulation will
not have a material adverse effect on the Portfolio or will not impair the
ability of the issuers of the Securities to achieve their business goals.

LIFE OF THE PORTFOLIO

The size and composition of the Portfolio will be affected by the level of
redemptions of Units that may occur from time to time. Principally, this will
depend upon the number of investors seeking to sell or redeem their Units or
participating in a rollover. The Portfolio will be terminated no later than the
mandatory termination date specified in Part A of the Prospectus. They will
terminate earlier upon the disposition of the last Security in that Portfolio or
upon the consent of investors holding 51% of the Units. The Portfolio may also
be terminated earlier by the Sponsors once its total assets have fallen below
the minimum value specified in Part A of the Prospectus. A decision by the
Sponsors to terminate the Portfolio early, which will likely be made following
the rollover, will be based on factors such as its size relative to its original
size, the ratio of Portfolio expenses to income, and the cost of maintaining a
current prospectus. See Trust Termination.

HOW TO BUY UNITS

Units are available from any of the Sponsors at the Public Offering Price.
The Public Offering Price varies each Business Day with changes in the value of
the Portfolio and other assets and liabilities of the Fund.

PUBLIC OFFERING PRICE

Units are charged a combination of Initial and Deferred Sales Charges equal,
in the aggregate, to a maximum charge of 2.75% of the Public Offering Price or,
for quantity purchases of units of all Select and Focus Portfolios, and certain
other selected Equity Investor Series, by an investor and the investor's spouse
and minor children, or by a single trust estate or fiduciary account, made on a
single day, the following percentages of the public offering price:

APPLICABLE SALES CHARGE
(GROSS UNDERWRITING PROFIT)
---------------------------
AS % OF
PUBLIC AS % OF NET
OFFERING AMOUNT
AMOUNT PURCHASED PRICE INVESTED
- ---------------------------- ----------- ------------
Less than $50,000........... 2.75% 2.778%
$50,000 to $99,999.......... 2.50 2.519
$100,000 to $249,999........ 2.00 2.005
$250,000 to $999,999........ 1.75 1.750
$1,000,000 or more.......... 1.00 1.000

In addition, a portion of the Public Offering Price also consists of cash or
securities in an amount sufficient to pay for all or a portion of the costs
incurred in establishing the Portfolio, including the cost of the initial
preparation of documents relating to the Portfolio, federal and state
registration fees, and the initial fees and expenses of the Trustee, legal
expenses and any other out-of-pocket expenses. The estimated organization costs
will be deducted from the assets of the Portfolio as of the close of the initial
offering period.

Prudential Securities Incorporated, which will participate only in rollover
sales, will receive a preferred dealer concession of $13.00 per 1,000 Units of
the Portfolio.

The Deferred Sales Charge is a monthly charge of $1.75 per 1,000 units and
is accrued in ten monthly installments commencing on the date indicated in Part
A of this Prospectus. Units redeemed or repurchased prior to the accrual of the
final Deferred Sales Charge installment will have the amount of any remaining
installments deducted

5
<PAGE>
from the redemption or repurchase proceeds or deducted in calculating an in-kind
distribution, although this deduction will be waived in the event of the death
or disability (as defined in the Internal Revenue Code of 1986) of an investor.
The Initial Sales Charge is equal to the aggregate sales charge, determined as
described above, less the aggregate amount of any remaining installments of the
Deferred Sales Charge.

It is anticipated that Securities will not be sold to pay the Deferred Sales
Charge until after the date of the last installment. Investors will be at risk
for market price fluctuations in the Securities from the several installment
accrual dates to the dates of actual sale of Securities to satisfy this
liability.

Employees of certain Sponsors and Sponsor affiliates and non-employee
directors of Merrill Lynch & Co. Inc. may purchase Units subject only to the
Deferred Sales Charge.

EVALUATIONS

Evaluations are determined by the Trustee on each Business Day. This
excludes Saturdays, Sundays and the following holidays as observed by the New
York Stock Exchange: New Year's Day, Presidents' Day, Martin Luther King, Jr.
Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving and
Christmas. In addition, the United Kingdom Portfolio 'business day' shall also
exclude the following U.K. holidays: Easter Monday, May Day, Summer Bank Holiday
and Boxing Day. If the Securities are listed on a securities exchange,
evaluations are generally based on closing sales prices on that exchange (unless
the Trustee deems these prices inappropriate) or, if closing sales prices are
not available, at the mean between the closing bid and offer prices. If the
Securities are not listed or if listed but the principal market is elsewhere,
the evaluation is generally determined based on sales prices of the Securities
on the over-the-counter market or, if sales prices in that market are not
available, on the basis of the mean between current bid and offer prices for the
Securities or for comparable securities or by appraisal or by any combination of
these methods. Neither the Sponsors nor the Trustee guarantee the
enforceability, marketability or price of any Securities. All evaluations are
converted to U.S. dollars at the then current exchange rates which include the
cost of a forward foreign exchange contract in the relevant currency to
correspond to the requirement that the Trustee settle redemption requests in
U.S. dollars within seven days.

NO CERTIFICATES

All investors are required to hold their Units in uncertificated form and in
'street name' by their broker, dealer or financial institution at the Depository
Trust Company ('DTC').

HOW TO REDEEM OR SELL UNITS

You can redeem your Units at any time for net asset value. In addition, the
Sponsors have maintained an uninterrupted secondary market for Units for over 20
years and will ordinarily buy back Units at net asset value. The following
describes these two methods to redeem or sell Units in greater detail.

REDEEMING UNITS

You can always redeem your Units for net asset value. This can be done by
contacting your broker, dealer or financial institution that holds your Units in
street name. In certain instances, additional documents may be required such as
a trust instrument, certificate of corporate authority, certificate of death or
appointment as executor, administrator or guardian.

Within seven days after the receipt of your request (and any necessary
documents), a check will be mailed to you in an amount equal to the net asset
value of your Units. Because of the sales charge, market movements or changes in
the Portfolio, net asset value at the time you redeem your Units may be greater
or less than the original cost of your Units. Net asset value is calculated each
Business Day by adding the value of the Securities, declared but unpaid
dividends on the Securities, cash and the value of any other Fund assets;
deducting unpaid taxes or other governmental charges, accrued but unpaid Fund
expenses and any remaining Deferred Sales Charges, unreimbursed Trustee
advances, cash held to redeem Units or for distribution to investors and the
value of any other Fund liabilities; and dividing the result by the number of
outstanding Units. After the initial offering period, net asset value will be
reduced to reflect the cost to the Fund of liquidating Securities to pay the
redemption price.

As long as the Sponsors are maintaining a secondary market for Units (as
described below), the Trustee will not actually redeem your Units but will sell
them to the Sponsors for net asset value. If the Sponsors are not maintaining a
secondary market, the Trustee will redeem your Units for net asset value or will
sell your Units in the over-the-

6
<PAGE>
counter market if the Trustee believes it will obtain a higher net price for
your Units. If the Trustee is able to sell the Units for a net price higher than
net asset value, you will receive the net proceeds of the sale.

If cash is not available in the Fund's Income and Capital Accounts to pay
redemptions, the Trustee may sell Securities selected by the Agent for the
Sponsors based on market and credit factors determined to be in the best
interest of the Fund. These sales are often made at times when the Securities
would not otherwise be sold and may result in lower prices than might be
realized otherwise and may also reduce the size and diversity of the Fund. If
Securities sales are made during a time when additional Units are being created
by the purchase of additional Securities (as described under Portfolio
Selection), Securities will be sold in a manner designed to maintain, to the
extent practicable, the proportionate relationship among the number of shares of
each Security in the Portfolio.

Any investor owning Units representing at least the lesser of Securities
with a value of at least U.S.$250,000 or 10% of the net asset value of the
Portfolio who redeems those Units prior to the rollover notification date
indicated in Part A of the Prospectus may, in lieu of cash redemption, request
distribution in kind of an amount and value of Securities per Unit equal to the
otherwise applicable Redemption Price per Unit. Whole shares of each Security
together with cash from the Capital Account equal to any fractional shares to
which the investor would be entitled (less any Deferred Sales Charge payable)
will be paid over to a distribution agent and either held for the account of the
investor or disposed of in accordance with instructions of the investor. Any
brokerage commissions as well as any transfer and ongoing custodial fees on
sales of Securities in connection with in-kind redemptions will be borne by the
redeeming investors. The in-kind redemption option may be terminated by the
Sponsors at any time upon prior notice to investors.

Redemptions may be suspended or payment postponed (i) if the New York Stock
Exchange is closed (other than customary weekend and holiday closings), (ii) if
the SEC determines that trading on the New York Stock Exchange is restricted or
that an emergency exists making disposal or evaluation of the Securities not
reasonably practicable or (iii) for any other period permitted by SEC order.

SPONSORS' SECONDARY MARKET FOR UNITS

The Sponsors, while not obligated to do so, will buy back Units at net asset
value without any other fee or charge as long as they are maintaining a
secondary market for Units. Because of the sales charge, market movements or
changes in the portfolio, net asset value at the time you sell your Units may be
greater or less than the original cost of your Units. The Sponsors may resell
the Units to other buyers or redeem the Units by tendering them to the Trustee.
You should consult your financial professional for current market prices to
determine if other broker-dealers or banks are offering higher prices for Units.

The Sponsors may discontinue the secondary market for Units without prior
notice if the supply of Units exceeds demand or for other business reasons.
Regardless of whether the Sponsors maintain a secondary market, you have the
right to redeem your Units for net asset value with the Trustee at any time, as
described above.

TRUST TERMINATION

Notice of impending termination of the Portfolio will be provided to
investors. A proportional share of the expenses associated with termination,
including brokerage costs incurred in disposing of Securities, will be borne by
investors remaining at that time. These expenses will reduce the amount of cash
or Securities those investors are to receive in any final distribution.

Upon termination of the Portfolio, the Trustee will distribute the
Securities and any cash in the Portfolio to a distribution agent that will act
as agent for the investors. Unless an investor elects to receive an in-kind
distribution of Securities, as discussed below, the distribution agent will, as
promptly as practicable, sell the investor's pro rata share of the Securities
and distribute to the investor the proceeds of the sale, less brokerage and
other related expenses, and the investor's pro rata share of any cash from the
Portfolio.

Any investor holding units at the termination of the Portfolio may, by
written notice to the Trustee at least ten business days prior to termination,
elect to received an in kind distribution of the investor's pro rata share of
the Securities remaining in the Portfolio at that time (net of the investor's
share of expenses). Fractional shares of Securities

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will be sold by the distribution agent and the net proceeds distributed to
investors. Investors subsequently selling Securities received in kind will incur
brokerage costs at that time which may exceed the value of any tax deferral
obtained through the in-kind distribution. Securities received in an in-kind
termination distribution may not be contributed to acquire units of another
Series.

ROLLOVER

In lieu of redeeming their units or receiving liquidation proceeds in cash
or in kind upon termination of the Portfolio, investors who hold their Units
with one of the Sponsors may elect, by contacting their financial adviser prior
to the rollover notification date indicated in Part A, to exchange their Units
in the Portfolio for units of next year's corresponding Select Ten International
Portfolio (if available). No election to roll over may be made prior to 30 days
before the date of the rollover, and any rollover election will be revocable at
any time prior to the date of the rollover. It is expected that the terms of the
new portfolio will be substantially the same as those of the Portfolio.

The rollover of an investor's Units is intended to be effected in a manner
that will not result in the recognition of either gain or loss for U.S. federal
income tax purposes with respect to Securities that are included in the new
portfolio ('Duplicated Securities'). Units held by an investor who elects the
rollover option will be redeemed through an in-kind distribution to a
distribution agent of the investor's pro rata share of Securities. The
distribution agent will then adjust the Securities distributed to the investor
so that its composition matches the investment profile of the new portfolio.
This adjustment will involve the sale of non-Duplicated Securities and,
possibly, of a portion of certain Duplicated Securities in order to rebalance
the portfolio, and the purchase of replacement Securities. Any excess sales
proceeds, net of sales related expenses, will be distributed to the investor.
After this adjustment the distribution agent will make an in-kind contribution
of the adjusted Securities to the new portfolio. Upon receipt of the in-kind
contribution, the trustee of the new portfolio will issue the appropriate number
of units in the new portfolio to the investor.

An investor who elects the rollover option will recognize capital gain or
loss with respect to the Securities, including fractional Securities, sold by
the distribution agent, but will not recognize gain or loss with respect to the
Duplicated Securities that are contributed in kind to the new portfolio. The
Sponsors intend to provide investors with information that will assist them in
determining their tax liability on an eventual sale of the Duplicated
Securities.

The Sponsors intend to cause the distribution agent to sell those Securities
that will not be contributed to the new portfolio, and then to create units of
the new portfolio, in each case as quickly as possible subject to the Sponsors'
sensitivity that the concentrated sale and purchase of large volumes of
securities may affect market prices in a manner adverse to the interest of
investors. Accordingly, the Sponsors may, in their sole discretion, undertake a
more gradual sale of Securities and a more gradual creation of units of the new
portfolio to help mitigate any negative market price consequences caused by this
large volume of securities trades. In order to minimize potential losses caused
by market movement during the rollover period, the Sponsors may enter into
program trades, which may increase brokerage commissions payable by investors.
There can be no assurance, however, that any trading procedures will be
successful or might not result in less advantageous prices. Pending the
investment of rollover proceeds in securities to comprise the new portfolio,
those moneys may be uninvested for several days.

Investors who participate in the rollover will not be entitled to receive a
cash distribution with which to pay any taxes incurred as a result of the
rollover procedure. Investors who do not participate in the rollover or
otherwise redeem their Units will continue to hold their Units until the
termination of the Portfolio; however, depending upon the extent of
participation in the rollover, the aggregate size of the Portfolio will be
reduced which could result in an increase in per Unit expenses.

The Sponsors may, in their sole discretion and without penalty or liability
to investors, decide not to sponsor a new 1999 International portfolio or to
modify the terms of the rollover. Prior notice of any decision would be provided
to investors.

The Division of Investment Management of the SEC is of the view that the
rollover option constitutes an 'exchange offer', for the purposes of Section
11(c) of the Investment Company Act of 1940, and would therefore be prohibited
absent an exemptive order. The Sponsors have received exemptive orders under
Section 11(c) which they believe permit them to offer the rollover, but no
assurance can be given that the SEC will concur with the Sponsors' position and
additional regulatory approvals may be required.

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INCOME, DISTRIBUTIONS AND REINVESTMENT

INCOME AND DISTRIBUTIONS

The annual U.S. dollar income per Unit that is earned by the Portfolio,
after deducting estimated annual Portfolio expenses per Unit, will depend
primarily upon the amount of dividends declared and paid by the issuers of the
Securities, fluctuations in U.S. dollar exchange rates and changes in the
expenses of the Portfolio and, to a lesser degree, upon the level of purchases
of additional Securities and sales of Securities. There is no assurance that
dividends on the Securities will continue at their current levels or be declared
at all.

Each Unit in the Portfolio receives an equal share of distributions of
dividend income on the Securities in that Portfolio net of estimated expenses.
Because dividends on the Securities are not received at a constant rate
throughout the year, any distribution may be more or less than the amount then
credited to the Income Account. Dividends received are credited to an Income
Account and converted into U.S. dollars at the current exchange rate upon
declaration of a semi-annual Portfolio distribution. Other receipts are credited
to a Capital Account after conversion into U.S. dollars at the current rate. A
Reserve Account may be created by withdrawing from the Income and Capital
Accounts amounts considered appropriate by the Trustee to reserve for any
material amount that may be payable out of the Portfolio. Funds held by the
Trustee in the various accounts do not bear interest. In addition, distributions
of amounts necessary to pay the Deferred Sales Charge will be made from the
Capital Account to an account maintained by the Trustee for purposes of
satisfying investors' sales charge obligations. Although the Sponsors may
collect the Deferred Sales Charge monthly, to keep Units more fully invested the
Sponsors currently do not anticipate sales of Securities to pay the Deferred
Sales Charge until after the rollover notification date. Proceeds of the
disposition of any Securities not used to pay Deferred Sales Charge or to redeem
Units will be held in the Capital Account and distributed on the final
Distribution Day or following liquidation of the Portfolios.

REINVESTMENT

Principal and income distributions on Units may be reinvested by
participating in the reinvestment plan. Under the plan, the Units acquired for
investors will be either Units already held in inventory by the Sponsors or new
Units created by the Sponsors' deposit of additional Securities, contracts to
purchase additional Securities or cash (or a bank letter of credit in lieu of
cash) with instructions to purchase additional Securities. Deposits or purchases
of additional Securities will generally be made so as to maintain the then
existing proportionate relationship among the number of shares of each Security
in the Portfolio. Units acquired by reinvestment will not be subject to the
initial sales charge but will be subject to any remaining installments of
Deferred Sales Charge. The Sponsors reserve the right to amend, modify or
terminate the reinvestment plan at any time without prior notice. Investors
holding Units in 'street name' should contact their broker, dealer or financial
institution if they wish to participate in the reinvestment plan.

PORTFOLIO EXPENSES

Estimated annual Portfolio expenses are listed in Part A of the Prospectus;
if actual expenses exceed the estimate, the excess will be borne by the
Portfolio. The estimated expenses do not include any brokerage commissions
payable by the Portfolio in buying and selling Securities. The Trustee's fee
shown in Part A of this Prospectus assumes that the Portfolio will reach a size
estimated by the Sponsors and is based on a sliding fee scale that reduces the
per 1,000 units Trustee fee as the size of the Portfolio increases. The
Trustee's annual fee is payable in monthly installments. The Trustee also
benefits when it holds cash for a Portfolio in non-interest bearing accounts.
Possible additional charges include Trustee fees and expenses for extraordinary
services, costs of indemnifying the Trustee and the Sponsors, costs of action
taken to protect the Fund and other legal fees and expenses, Fund termination
expenses and any governmental charges. The Trustee has a lien on Portfolio
assets to secure reimbursement of these amounts and may sell Securities for this
purpose if cash is not available. The Sponsors receive an annual fee currently
estimated at $0.45 per 1,000 Units to reimburse them for the cost of providing
Portfolio supervisory, bookkeeping and administrative services and for any other
expenses properly chargeable to the Portfolio. While the fee may exceed the
amount of these costs and expenses attributable to the Portfolio, the total of
these fees from all Series of Defined Asset Funds will not exceed the aggregate
amount attributable to all of those Series during any calendar year. The
Trustee's and Sponsors' fees may be adjusted for inflation without investors'
approval.

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Advertising and selling expenses will be paid from the Underwriting Account
at no charge to the Portfolio. Defined Asset Funds can be a cost-effective way
to purchase and hold investments. Annual operating expenses are generally lower
than for managed funds. Because Defined Asset Funds have no management fees,
limited transaction costs and no ongoing marketing expenses, operating expenses
are generally less than 0.25% a year. When compounded annually, small
differences in expense ratios can make a big difference in your investment
results.

TAXES

U.S. TAXATION

The following discussion addresses only the tax consequences of Units held
as capital assets and does not address the tax consequences of Units held by
persons with special tax circumstances, such as dealers, financial institutions,
insurance companies or former U.S. citizens or long term residents.

As used herein, the term 'U.S. Investor' means an owner of a Unit in the
Portfolio that is (i) for United States federal income tax purposes a citizen or
resident of the United States, (ii) a corporation, partnership or other entity
created or organized in or under the laws of the United States or of any
political subdivision thereof, or (iii) an estate or trust the income of which
is subject to United States federal income taxation regardless of its source. An
investor that is not a U.S. Investor but whose income from a Unit is effectively
connected with such Investor's conduct of a United States trade or business will
generally be taxed in the same manner as a U.S. Investor but should consult his
or her tax advisor in this regard.

The following discussion relates only to U.S. Investors. Since the Portfolio
holds only Securities of non-U.S. issuers, it is expected that income earned by
investors who are not U.S. Investors will not be treated as U.S.-source income
and should not be subject to any U.S. withholding tax.

In the opinion of Davis Polk & Wardwell, special counsel for the Sponsors,
under existing law:

The Portfolio is not an association taxable as a corporation for federal
income tax purposes. Each U.S. Investor will be considered the owner of a
pro rata portion of each Security in the Portfolio under the grantor trust
rules of Sections 671-679 of the Internal Revenue Code of 1986, as amended
(the 'Code'). Each U.S. Investor will be considered to have received all of
the dividends paid on his pro rata portion of each Security and any exchange
gain or loss resulting from the conversion into U.S. dollars of any such
dividends paid in foreign currency when such amounts are received or
converted by the Portfolio, regardless of whether such dividends are subject
to withholding taxes or used to pay a portion of the Portfolio's expenses or
whether they are automatically reinvested (see Reinvestment).

Dividends considered to have been received by a corporate U.S. Investor
will not qualify for the dividends-received deduction because the
dividends-received deduction is generally only available for dividends
received from domestic corporations.

The United Kingdom Portfolio will report as gross income earned by U.S.
Investors their pro rata share of dividends received by the Portfolio as
well as their pro rata share of any associated U.K. tax credits
(notwithstanding that it is not certain that U.S. Investors will receive any
refund of U.K. taxes). Those U.S. Investors who hold Units on the relevant
record date for dividends on the underlying Securities held by the United
Kingdom Portfolio should be entitled, subject to applicable limitations, to
either a credit or a deduction for foreign taxes legally owed with respect
to such dividend payments and should consult their tax advisers in this
regard. IRAs and other plans addressed below under 'Retirement Plans' should
note that they are not likely to be eligible to claim any Treaty Payment (as
defined below under 'United Kingdom Taxation', which provides further
details).

An individual U.S. Investor who itemizes deductions will be entitled to
deduct his pro rata share of Portfolio expenses only to the extent that this
amount together with the U.S. Investor's other miscellaneous deductions
exceeds 2% of his adjusted gross income. The Code further restricts the
ability of an individual U.S. Investor with an adjusted gross income in
excess of a specified amount (for 1998, $124,500 or $62,250 for a married
person filing a separate return) to claim itemized deductions (including his
pro rata share of Portfolio expenses).

The U.S. Investor's basis in his Units will equal the cost of his Units,
including the initial sales charge. A portion of the sales charge is
deferred until the termination of the Portfolio or the redemption of the
Units. The proceeds received by a U.S. Investor upon such event will reflect
deduction of the deferred amount (the 'Deferred Sales Charge') and a charge
for organizational expenses. The annual statement and the relevant tax
reporting

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forms received by U.S. Investors will be based upon the amounts paid to
them, net of the Deferred Sales Charge and the charge for organizational
expenses. Accordingly, U.S. Investors should not increase their basis in
their Units by the Deferred Sales Charge or any amount used to pay
organizational expenses.

A U.S. investor will generally recognize capital gain or loss when the
U.S. Investor disposes of his Units for cash (by sale or redemption) or when
the Trustee disposes of the Securities from the Portfolio. A U.S. Investor
will not recognize gain or loss upon the distribution of a pro rata amount
of each of the Securities by the Trustee to a U.S. Investor (or to his
agent) in redemption of Units or upon termination of the Portfolio, except
to the extent of cash received in lieu of fractional shares. The redeeming
U.S. Investor's basis for such Securities will be equal to his basis for the
same Securities (previously represented by his Units) prior to such
redemption, and his holding period for such Securities will include the
period during which he held his Units.

A U.S. investor who elects to roll over into a new portfolio (a 'rollover
investor') will not recognize gain or loss either upon the distribution of
Securities by the Trustee to the distribution agent or upon the contribution
of Duplicated Securities (as defined under Rollover) to the new portfolio.
The rollover investor will generally recognize capital gain or loss as a
consequence of the distribution agent's sale of non-Duplicated Securities.
The rollover investor's basis for the Duplicated Securities that are
contributed in kind to the new portfolio will be equal to his basis for the
same Duplicated Securities prior to the rollover, and his holding period for
the contributed Duplicated Securities will include the period during which
he held an interest in the same Duplicated Securities through an investment
in the Portfolio and in prior years' corresponding Select Ten International
Portfolio.

A U.S. Investor will generally not recognize gain or loss upon the
distribution of a pro rata amount of each of the Securities by the Trustee
to a U.S. Investor (or to his agent) in redemption of Units, except to the
extent of cash received in lieu of fractional shares. The redeeming U.S.
Investor's basis for such Securities will be equal to his basis for the same
Securities (previously represented by his Units) prior to such redemption,
and his holding period for such Securities will include the period during
which he held his Units. Capital gain on a disposition of Units or
Securities by U.S. Investors will generally be U.S. source income. Any
foreign currency gain or loss with respect to an investment in the Portfolio
will generally be treated as ordinary income or loss.

Net capital gain (the excess of net long-term capital gains over net
short-term capital losses) may be taxed at lower rates than ordinary income
(a maximum federal tax rate of 20%) for certain individuals and other
noncorporate taxpayers. A capital gain or loss is long-term if the asset is
held for more than one year and short-term if held for one year or less. The
deduction of capital losses is subject to limitations. The lower net capital
gain tax rates will be unavailable to those noncorporate U.S. Investors who,
as of the mandatory termination date (or earlier termination of the
Portfolio), have held their Units for a year or less. The lower net capital
gain tax rates will also be unavailable to noncorporate rollover investors
for gains on non-Duplicated Securities if, as of the beginning of the
rollover period, those investors have held their Units for a year or less.
U.S. noncorporate Investors may be entitled to the lower net capital gains
tax rates if they have held their Units for more than one year. Moreover, a
noncorporate rollover U.S. Investor may be eligible for the lower net
capital gains tax rates on the portion of capital gain recognized on sales
of Securities or Units of the new portfolio (or subsequent portfolios) that
is attributable to Duplicated Securities if the investor is treated as
having held the Duplicated Securities for more than one year. Investors
should consult their tax advisers regarding these matters.

Under the income tax laws of the State and City of New York, the
Portfolio is not an association taxable as a corporation and the income of
the Portfolio will be treated as the income of the U.S. Investors in the
same manner as for federal income tax purposes.

The foregoing discussion relates only to the tax treatment of U.S.
Investors with regard to federal and certain aspects of New York State and
City income taxes. U.S. Investors may be subject to taxation in New York or
in other jurisdictions and should consult their own tax advisers in this
regard.

* * * *

At the termination of the Portfolio, the Trustee will furnish to each
investor an annual statement containing information relating to the dividends
received by the Portfolio on the Securities, the cash proceeds received by the
Portfolio from the disposition of any Security (resulting from redemption or the
sale by the Portfolio of any Security), and the fees and expenses paid by the
Portfolio. The Trustee will also furnish annual information returns to each
investor and to the Internal Revenue Service.

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UNITED KINGDOM TAXATION

The following discussion addresses certain U.K. tax consequences of the
ownership of Units of the United Kingdom Portfolio held by certain U.S.
Investors only. For the U.S. tax consequences to U.S. Investors, see U.S.
Taxation. The discussion does not address the tax consequences for non-U.S.
investors, who should consult their own tax advisers in this respect.

General. In the opinion of Linklaters & Paines, the Sponsors' U.K. special
counsel, based on the description of the United Kingdom Portfolio in the
Prospectus and on certain representations made by special U.S. counsel to the
Sponsors, this summary accurately describes the material U.K. tax consequences
to certain U.S. Investors in the U.K. Portfolio. This summary is based upon
current U.S. law, U.K. taxation law, U.K. Inland Revenue practice, the U.S./U.K.
convention relating to taxes on income and capital gains (the 'Treaty') and the
U.S./U.K. estate and gift taxes convention (the 'Estate Tax Treaty'). The
summary is a general guide only and is subject to any changes in any of the
aforesaid after the date of this Prospectus (including changes on a retroactive
basis) which may affect the tax analysis described below. Accordingly,
prospective investors should consult their U.K. tax advisers as to the U.K. tax
consequences of owning Units of the United Kingdom Portfolio applicable to their
circumstances.

Taxation of Dividends. Subject to the following paragraph, a U.K. resident
individual who receives a dividend from a U.K. company is generally entitled to
a tax credit, which is either offset against U.K. tax liabilities, or, in
certain circumstances, repaid. Under the Treaty, a U.S. Investor who is resident
in the U.S. for the purposes of the Treaty may be entitled to repayment of the
tax credit, but such repayment is subject to U.K. withholding tax of 15% on the
sum of the dividend and the tax credit.

For dividends paid by U.K. companies before April 6, 1999, the tax credit
(before such withholding) is equal to one quarter of the dividend (the 'Tax
Credit Amount'). Although such a U.S. Investor who held shares directly in a
U.K. company could generally claim a refund of part of the Tax Credit Amount
attributable to the dividend (a 'Treaty Payment'), the ability of such a U.S.
Investor in the United Kingdom Portfolio to claim a Treaty Payment is unclear
where dividend payments are made to an entity such as the Fund. Accordingly, for
such a U.S. Investor to be able to claim Treaty Payments, it would be necessary
to agree to a special procedure with the U.K. Inland Revenue in advance. In the
absence of agreeing to such a procedure, U.S. Investors may not in practice be
able to claim a Treaty Payment from the U.K. Inland Revenue.

For dividends paid by a U.K. company on or after April 6, 1999, the tax
credit is to be reduced to one-ninth of the dividend. U.S. investors should note
that it will not thereafter be possible to claim a Treaty Payment in respect of
dividends paid on or after April 6, 1999 on the securities listed in FT Index
held in the 'United Kingdom Portfolio'.

A U.K. company may elect for a dividend paid before April 6, 1999 to be a
'foreign income dividend' rather than an ordinary dividend. No tax credits are
attributable to such foreign income dividends. No such election may be made in
respect of dividends paid by a U.K. corporation on or after April 6, 1999.

Taxation of Capital Gains. U.S. Investors who are neither resident nor
ordinarily resident in the U.K. will not be liable for U.K. tax on gains arising
on the disposal of Units unless the Units are used, held or acquired for the
purposes of a trade, profession or vocation carried on in the U.K. through, or
for the purposes of, a permanent establishment or fixed base as defined in the
Treaty.

U.K. Inheritance Tax. Individual U.S. Investors who are domiciled in the
U.S. (as defined by the Estate Tax Treaty) and who are not U.K. nationals (as
defined by the Estate Tax Treaty) will generally not be subject to U.K.
inheritance tax on death or on lifetime gifts of Units in the United Kingdom
Portfolio provided that any applicable U.S. federal gift or estate tax is paid,
unless the Units are part of the business property of U.K. permanent
establishments or pertain to U.K. fixed bases used for the performance of
personal services. Where the Units have been settled on trust, the Units will
generally not be subject to U.K. inheritance tax unless the settlor, at the time
of settlement, was not domiciled in the U.S. or was a U.K. national provided
that any applicable U.S. federal gift or estate tax is paid. In the exceptional
case where Units are subject to both U.K. inheritance tax and to U.S. federal
gift or estate tax, the Estate Tax Treaty generally provides for U.K. tax paid
to be credited against tax payable in the U.S., or for tax paid in the U.S. to
be credited against tax payable in the U.K., based on rules set out in the
Estate Tax Treaty.

* * * *

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As mentioned in 'United Kingdom -- Taxation of Dividends' above, for a U.S.
Investor to be able to claim Treaty Payments it would be necessary to agree a
special procedure with the Inland Revenue in advance. The Inland Revenue operate
a special procedure under which trustees of funds like the Fund may claim Treaty
Payments on behalf of Investors. The Inland Revenue have agreed to such
procedure in respect of the Fund, under the terms of which the Trustee may claim
Treaty Payments on behalf of U.S. Investors in the United Kingdom Portfolio. The
amount of any Treaty Payment obtained by the Trustee with respect to a dividend
will be reflected in the net asset value of the Portfolio and will be
distributed to investors on the first Distribution Date after the Treaty Payment
is received by the Portfolio.

RETIREMENT PLANS

This Series of Equity Investor Fund may be well suited for purchase by
Individual Retirement Accounts ('IRAs'), Keogh plans, pension funds and other
qualified retirement plans, certain of which are briefly described below.
Generally, capital gains and income received in each of the foregoing plans are
exempt from Federal taxation. All distributions from such plans are generally
treated as ordinary income but may, in some cases, be eligible for special 5 or
10 year averaging (prior to 2000) or tax-deferred rollover treatment. Investors
holding IRAs, Keogh plans and other tax-deferred retirement plans should consult
their plan custodian as to the appropriate disposition of distributions.
Investors considering participation in any of these plans should review specific
tax laws related thereto and should consult their attorneys or tax advisors with
respect to the establishment and maintenance of any of these plans. These plans
are offered by brokerage firms, including the Sponsor of this Fund, and other
financial institutions. Fees and charges with respect to such plans may vary.

Retirement Plans for the Self-Employed--Keogh Plans. Units may be purchased
by retirement plans established for self-employed individuals, partnerships or
unincorporated companies ('Keogh plans'). The assets of a Keogh plan must be
held in a qualified trust or other arrangement which meets the requirements of
the Code. Keogh plan participants may also establish separate IRAs (see below)
to which they may contribute up to an additional $2,000 per year ($4,000 in a
spousal account).

Individual Retirement Account--IRA. Any individual can establish an IRA or
make use of a qualified IRA arrangement for the purchase of Units of the Fund.
Any individual (including one covered by an employer retirement plan) can make a
contribution to an IRA equal to the lesser of $2,000 ($4,000 in a spousal
account) or 100% of earned income; the investment must be made in cash. However,
the deductible amount of a contribution by an individual covered by an employer
retirement plan will be reduced if the individual or the individual's spouse is
covered by an employer maintained retirement plan and the individual's adjusted
gross income exceeds $25,000 (in the case of a single individual), $40,000 (in
the case of a married individual filing a joint return) or $200 (in the case of
a married individual filing a separate return). These income threshholds will
gradually be increased by 2004 to $50,000 for a single individual and $80,000
for a married individual filing jointly. Certain transactions which are
prohibited under Section 408 of the Code will cause all or a portion of the
amount in an IRA to be deemed to the distributed and subject to tax at that
time. Unless nondeductible contributions were made in 1987 or a later year, all
distributions from an IRA will be treated as ordinary income but generally are
eligible for tax-deferred rollover treatment. Taxable distributions made before
attainment of age 59 1/2, except in the case of the participant's death or
disability or where the amount distributed is part of a series of substantially
equal periodic (at least annual) payments that are to be made over the life
expectancies of the participant and his or her beneficiary, are generally
subject to a surtax in an amount equal to 10% of the distribution. The 10%
surtax will be waived for withdrawals for certain educational and first-time
homebuyers expenses. Subject to certain income limitations, under a special type
of IRA, contributions would be non-deductible but distributions would be
tax-free if the account were held for at least five years and the account holder
was at least 59 1/2 at the time of distribution.

Corporate Pension and Profit-Sharing Plans. A pension or profit-sharing plan
for employees of a corporation may purchase Units of the Fund.

RECORDS AND REPORTS

The Trustee keeps a register of the names, addresses and holdings of all
investors. The Trustee also keeps records of the transactions of the Portfolio,
including a current list of the Securities and a copy of the Indenture, which
may be inspected by investors at reasonable times during business hours.

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With each distribution, the Trustee includes a statement of the amounts of
income and any other receipts being distributed. Following the termination of
the Portfolio, the Trustee sends each investor of record a statement summarizing
transactions in the Portfolio's accounts including amounts distributed from
them, identifying Securities sold and purchased and listing Securities held and
the number of Units outstanding at termination and stating the Redemption Price
per 1,000 Units at termination, and the fees and expenses paid by the Portfolio,
among other matters. Portfolio accounts may be audited by independent
accountants selected by the Sponsors and any report of the accountants will be
available from the Trustee on request.

TRUST INDENTURE

The Portfolio is a 'unit investment trust' created under New York law by a
Trust Indenture among the Sponsors and the Trustee. This Prospectus summarizes
various provisions of the Indenture, but each statement is qualified in its
entirety by reference to the Indenture.

The Indenture may be amended by the Sponsors and the Trustee without consent
by investors to cure ambiguities or to correct or supplement any defective or
inconsistent provision, to make any amendment required by the SEC or other
governmental agency or to make any other change not materially adverse to the
interest of investors (as determined in good faith by the Sponsors). The
Indenture may also generally be amended upon consent of investors holding 51% of
the Units. No amendment may reduce the interest of any investor in the Portfolio
without the investor's consent or reduce the percentage of Units required to
consent to any amendment without unanimous consent of investors. Investors will
be notified of the substance of any amendment.

The Trustee may resign upon notice to the Sponsors. It may be removed by
investors holding 51% of the Units at any time or by the Sponsors without the
consent of investors if it becomes incapable of acting or bankrupt, its affairs
are taken over by public authorities, or if under certain conditions the
Sponsors determine in good faith that its replacement is in the best interest of
the investors. The resignation or removal becomes effective upon acceptance of
appointment by a successor; in this case, the Sponsors will use their best
efforts to appoint a successor promptly; however, if upon resignation no
successor has accepted appointment within 30 days after notification, the
resigning Trustee may apply to a court of competent jurisdiction to appoint a
successor.

Any Sponsor may resign so long as one Sponsor with a net worth of $2,000,000
remains. A new Sponsor may be appointed by the remaining Sponsors and the
Trustee to assume the duties of the resigning Sponsor. If there is only one
Sponsor and it fails to perform its duties or becomes incapable of acting or
bankrupt or its affairs are taken over by public authorities, the Trustee may
appoint a successor Sponsor at reasonable rates of compensation, terminate the
Indentures and liquidate the Fund or continue to act as Trustee without a
Sponsor. Merrill Lynch, Pierce, Fenner & Smith Incorporated has been appointed
as Agent for the Sponsors by the other Sponsors.

The Sponsors and the Trustee are not liable to investors or any other party
for any act or omission in the conduct of their responsibilities absent bad
faith, willful misfeasance, negligence (gross negligence in the case of a
Sponsor) or reckless disregard of duty. The Indentures contain customary
provisions limiting the liability of the Trustee.

MISCELLANEOUS

LEGAL OPINION

The legality of the Units has been passed upon by Davis Polk & Wardwell, 450
Lexington Avenue, New York, New York 10017, as special counsel for the Sponsors.

AUDITORS

The Statement of Condition in Part A of the Prospectus was audited by
Deloitte & Touche LLP, independent accountants, as stated in their opinion. It
is included in reliance upon that opinion given on the authority of that firm as
experts in accounting and auditing.

TRUSTEE

The Trustee and its address are stated on the back cover of the Prospectus.
The Trustee is subject to supervision by the Federal Deposit Insurance
Corporation, the Board of Governors of the Federal Reserve System and New York
State banking authorities.

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<PAGE>
SPONSORS

The Sponsors are listed on the back cover of the Prospectus. They may
include Merrill Lynch, Pierce, Fenner & Smith Incorporated, a wholly-owned
subsidiary of Merrill Lynch & Co., Inc.; Smith Barney Inc., an indirect wholly-
owned subsidiary of The Travelers Inc.; Dean Witter Reynolds Inc., a principal
operating subsidiary of Morgan Stanley Dean Witter & Co., and PaineWebber
Incorporated, a wholly-owned subsidiary of PaineWebber Group Inc. Each Sponsor,
or one of its predecessor corporations, has acted as Sponsor of a number of
series of unit investment trusts. Each Sponsor has acted as principal
underwriter and managing underwriter of other investment companies. The
Sponsors, in addition to participating as members of various selling groups or
as agents of other investment companies, execute orders on behalf of investment
companies for the purchase and sale of securities of these companies and sell
securities to these companies in their capacities as brokers or dealers in
securities.

CODE OF ETHICS

The Agent for the Sponsors has adopted a code of ethics requiring
preclearance and reporting of personal securities transactions by its personnel
who have access to information on Defined Asset Funds portfolio transactions.
The code is intended to prevent any act, practice or course of conduct which
would operate as a fraud or deceit on any Fund and to provide guidance to these
persons regarding standards of conduct consistent with the Agent's
responsibilities to the Funds.

YEAR 2000 ISSUES

Many computer systems were designed using only two digits to designate
years. These systems may not be able to distinguish the Year 2000 from the Year
1900 (commonly known as the 'Year 2000 Problem'). Like other investment
companies and financial and business organizations, the Fund could be adversely
affected if the computer systems used by the Agent for the Sponsors or Fund
service providers do not properly address this problem prior to January 1, 2000.
The Agent for the Sponsors has established a dedicated group to analyze these
issues and to implement any systems modifications necessary to prepare for the
Year 2000. Currently, we do not anticipate that the transition to the 21st
century will have any material effect on the Fund. The Agent for the Sponsors
has sought assurances from the Fund's other service providers that they are
taking all necessary steps to ensure that their computer systems will accurately
reflect the Year 2000, and the Agent for the Sponsors will continue to monitor
the situation. At this time, however, no assurance can be given that the Fund's
other service providers have anticipated every step necessary to avoid any
adverse effect on the Fund attributable to the Year 2000 Problem.

PUBLIC DISTRIBUTION

During the initial offering period and thereafter to the extent additional
Units continue to be offered for sale to the public by means of this Prospectus,
Units will be distributed directly to the public by this Prospectus at the
Public Offering Price determined in the manner provided above. The Sponsors
intend to qualify Units for sale in all states in which qualification is deemed
necessary through the Underwriting Account and by dealers who are members of the
National Association of Securities Dealers, Inc. The Sponsors do not intend to
qualify Units for sale in any foreign countries and this Prospectus does not
constitute an offer to sell Units in any country where Units cannot lawfully be
sold.

UNDERWRITERS' AND SPONSORS' PROFITS

Upon sale of the Units, the Underwriters, which are listed on the back cover
of the Prospectus, will be entitled to receive sales charges; each Underwriters'
interest in the Underwriting Account will depend on the number of Units acquired
through the issuance of additional Units. The Sponsors also realize a profit or
loss on deposit of the Securities equal to the difference between the cost of
the Securities to the Fund (based on the aggregate value of the Securities on
their date of deposit) and the purchase price of the Securities to the Sponsors
plus commissions payable by the Sponsors. In addition, a Sponsor or Underwriter
may realize profits or sustain losses on Securities it deposits in the Fund
which were acquired from underwriting syndicates of which it was a member.
During the initial offering period, the Underwriting Account also may realize
profits or sustain losses as a result of fluctuations after the initial date of
deposit in the Public Offering Price of the Units. In maintaining a secondary
market for Units, the Sponsors will also realize profits or sustain losses in
the amount of any difference between the prices at which they buy Units and the
prices at which they resell these Units (which include the sales charge) or the
prices at which they redeem the Units. Cash, if any, made available by buyers of
Units to the Sponsors prior to a settlement date for the purchase of Units

15
<PAGE>
may be used in the Sponsors' businesses to the extent permitted by Rule 15c3-3
under the Securities Exchange Act of 1934 and may be of benefit to the Sponsors.

PERFORMANCE INFORMATION

Total returns, average annualized returns or cumulative returns for various
periods of Strategy Stocks, the related index, the current or one or more prior
Select Ten Portfolios may be included from time to time in advertisements, sales
literature and reports to current or prospective investors. Total return shows
changes in Unit price during the period plus reinvestment of dividends and
capital gains, divided by the maximum public offering price. Average annualized
returns show the average return for stated periods of longer than a year.
Figures for actual Portfolios (but not Strategy Stocks or related index) reflect
deduction of all Portfolio expenses and unless otherwise stated the maximum
sales charge. No provision is made for any income taxes payable. Similar figures
may be given for Strategy Stocks and other Select Ten Portfolios applying the
Strategy to other indexes. Returns of Strategy Stocks of multiple Select Ten
Strategies may also be shown on a combined basis. Investors should bear in mind
that this represents past performance and is no assurance of future results of
the current or any future Portfolio. Advertisements and other material
distributed to prospective investors may include average annual total returns
(with dividends reinvested) of equity markets in major industrialized countries
over the last 10 years, as compiled by Morgan Stanley Capital International
Index.

DEFINED ASSET FUNDS

For decades informed investors have purchased unit investment trusts for
dependability and professional selection of investments. Defined Asset Funds'
philosophy is to allow investors to 'buy with knowledge' (because, unlike
managed funds, the portfolio is relatively fixed) and 'hold with confidence'
(because the portfolio is professionally selected and regularly reviewed).
Defined Asset Funds offers an array of simple and convenient investment choices,
suited to fit a wide variety of personal financial goals--a buy and hold
strategy for capital accumulation, such as for children's education or
retirement, or regular current income consistent with the preservation of
principal. Unit investment trusts are particularly suited for investors who
prefer to seek long-term profits by purchasing and holding investments, rather
than through active trading. Few individuals have the knowledge, resources or
capital to buy and hold a diversified portfolio on their own; it would generally
take a considerable sum of money to obtain the breadth and diversity that
Defined Asset Funds offer. Your investment objectives may call for a combination
of Defined Asset Funds.

Defined Asset Funds reflect a buy and hold strategy that the Sponsors
believe can be more effective and less expensive than active management. This
strategy is premised on selection criteria and procedures, diversification and
regular monitoring by investment professionals. Various advertisements and sales
literature may summarize the results of economic studies concerning how stock
market movement has tended to be concentrated and how longer-term investments
can tend to reduce risk.

One of the most important investment decisions you face may be how to
allocate your investments among asset classes. Diversification among different
kinds of investments can balance the risks and rewards of each one. Most
investment experts recommend stocks for long-term capital growth. Long-term
corporate bonds offer relatively high rates of interest income. By purchasing
both defined equity and defined bond funds, investors can receive attractive
current income, as well as growth potential, offering some protection against
inflation. From time to time various advertisements, sales literature, reports
and other information furnished to current or prospective investors may present
the average annual compounded rate of return of selected asset classes over
various periods of time, compared to the rate of inflation over the same
periods.

EXCHANGE OPTION

You may exchange Fund Units for units of other Select and Focus Series and
certain other Equity Investor Fund series with one-or two-year terms and a
combination of initial and deferred sales charges. Select and Focus Portfolios
have a sales charge for first-time investors of 1% initially and annual deferred
sales charges of $17.50 per 1,000 units. On exchanges, the initial sales charge
is waived and units are acquired subject to any remaining deferred sales
charges. Investors can also exchange units of those Portfolios and similar
series of unaffiliated equity unit investment trusts for Fund Units, subject
only to the Fund's remaining deferred sales charges. In the future, the Exchange
Option may be extended to other series and types of trusts with similar sales
charge structures.

16
<PAGE>
To make an exchange, you should contact your financial professional to find
out what suitable exchange funds are available and to obtain a prospectus. You
may acquire units of only those exchange funds in which the Sponsors are
maintaining a market and which are lawfully for sale in the state where you
reside. An exchange is a taxable event normally requiring recognition of any
gain or loss on the units exchanged. However, the Internal Revenue Service may
seek to disallow a loss if the portfolio of the units acquired is not materially
different from the portfolio of the units exchanged; you should consult your own
tax adviser. If the proceeds of units exchanged are insufficient to acquire a
whole number of exchange fund units, you may pay the difference in cash (not
exceeding the price of a single unit acquired).

As the Sponsors are not obligated to maintain a market in any series, there
can be no assurance that units can be exchanged. The Exchange Option may be
amended or terminated at any time without notice.

SUPPLEMENTAL INFORMATION

Upon writing or calling the Trustee shown on the back cover of this
Prospectus, investors will receive without charge supplemental information about
a Portfolio, which has been filed with the SEC. The supplemental information
includes more detailed risk factor disclosure about the types of securities that
may be part of the Portfolio and general information about the structure and
operation of the Fund.

17
<PAGE>
Defined
Asset FundsSM

SPONSORS AND UNDERWRITERS: EQUITY INVESTOR FUND
Merrill Lynch, SELECT TEN PORTFOLIO
Pierce, Fenner & Smith Incorporated1998 INTERNATIONAL SERIES 3
Defined Asset Funds UNITED KINGDOM PORTFOLIO
P.O. Box 9051
Princeton, N.J. 08543-9051 This Prospectus does not contain all of the
(609) 282-8500 information with respect to the investment
Smith Barney Inc. company set forth in its registration
Unit Trust Department statement and exhibits relating thereto which
388 Greenwich Street--23rd Floor have been filed with the Securities and
New York, NY 10013 Exchange Commission, Washington, D.C. under
(212) 816-4000 the Securities Act of 1933 and the Investment
PaineWebber Incorporated Company Act of 1940, and to which reference
1200 Harbor Blvd. is hereby made. Copies of filed material can
Weehawken, N.J. 07087 be obtained from the Public Reference Section
(201) 902-3000 of the Commission, 450 Fifth Street, N.W.,
Dean Witter Reynolds Inc. Washington, D.C. 20549 at prescribed rates.
Two World Trade Center--59th Floor The Commission also maintains a Web site that
New York, N.Y. 10048 contains information statements and other
(212) 392-2222 information regarding registrants such as
TRUSTEE: Defined Asset Funds that file electronically
The Bank of New York with the Commission at http://www.sec.gov.
P.O. Box 974 ------------------------
Wall St. Division No person is authorized to give any
New York, N.Y. 10268-0974 information or to make any representations
1-800-221-7771 with respect to this investment company not
contained in its registration statement and
related exhibits; and any information or
representation not contained therein must not
be relied upon as having been authorized.
------------------------
When Units of this Fund are no longer
available and for investors who will reinvest
into subsequent International Select Ten
Portfolios, this Prospectus may be used as a
preliminary prospectus for a future series,
in which case investors should note the
following:
Information contained herein is subject to
amendment. A registration statement relating
to securities of a future series has been
filed with the Securities and Exchange
Commission. These securities may not be sold
nor may offers to buy be accepted prior to
the time the registration statement becomes
effective.
This Prospectus shall not constitute an offer
to sell or the solicitation of an offer to
buy nor shall there be any sale of these
securities in any State in which such offer
solicitation or sale would be unlawful prior
to registration or qualification under the
securities laws of any such State.

70099--7/98