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DEFINED ASSET FUNDSSM
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EQUITY INVESTOR FUND
CONCEPT SERIES
TELE-GLOBAL TRUST--4
(A UNIT INVESTMENT TRUST)
O TOTAL RETURN THROUGH:
-- CAPITAL APPRECIATION
-- DIVIDEND INCOME
O PROFESSIONAL SELECTION
O DIVERSIFICATION WITHIN THE TELECOMMUNICATIONS
INDUSTRY
O OPTIONAL REINVESTMENT OF CASH DISTRIBUTIONS
SPONSORS: -------------------------------------------------
Merrill Lynch, The Securities and Exchange Commission has not
Pierce, Fenner & Smith approved or disapproved these Securities or
Incorporated passed upon the adequacy of this prospectus. Any
Salomon Smith Barney Inc. representation to the contrary is a criminal
PaineWebber Incorporated offense.
Dean Witter Reynolds Inc. Prospectus dated November 19, 1999.
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Defined Asset FundsSM
Defined Asset FundsSM is America's oldest and largest family of unit investment
trusts, with over $160 billion sponsored over the last 28 years. Defined Asset
Funds has been a leader in unit investment trust research and product
innovation. Our family of Funds helps investors work toward their financial
goals with a full range of quality investments, including municipal, corporate
and government bond portfolios, as well as domestic and international equity
portfolios.
Defined Asset Funds offer a number of advantages:
o A disciplined strategy of buying and holding with a long-term view is the
cornerstone of Defined Asset Funds.
o Fixed portfolio: Defined Funds follow a buy and hold investment strategy;
funds are not managed and portfolio changes are limited.
o Defined Portfolios: We choose the stocks and bonds in advance, so you know
what you're investing in.
o Professional research: Our dedicated research team seeks out stocks or bonds
appropriate for a particular fund's objectives.
o Ongoing supervision: We monitor each portfolio on an ongoing basis.
No matter what your investment goals, risk tolerance or time horizon, there's
probably a Defined Asset Fund that suits your investment style. Your financial
professional can help you select a Defined Asset Fund that works best for your
investment portfolio.
THE FINANCIAL INFORMATION IN THIS PROSPECTUS IS AS OF THE EVALUATION DATE, JULY
31, 1999.
CONTENTS
PAGE
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Risk/Return Summary..................................... 3
What You Can Expect From Your Investment................ 5
Income............................................... 5
Records and Reports.................................. 5
The Risks You Face...................................... 5
Concentration Risk................................... 5
Foreign Issuer Risk.................................. 6
Litigation and Legislation Risks..................... 6
Selling Units........................................... 6
Sponsors' Secondary Market........................... 7
Selling Units to the Trustee......................... 7
Rollover/Exchange Option............................. 8
How The Fund Works...................................... 8
Pricing.............................................. 8
Evaluations.......................................... 8
Income............................................... 9
Expenses............................................. 9
Portfolio Changes.................................... 10
Portfolio Termination................................ 10
No Certificates...................................... 10
Trust Indenture...................................... 10
Legal Opinion........................................ 11
Auditors............................................. 11
Sponsors............................................. 11
Trustee.............................................. 11
Underwriters' and Sponsors' Profits.................. 11
Public Distribution.................................. 12
Code of Ethics....................................... 12
Year 2000 Issues..................................... 12
Advertising and Sales Literature..................... 12
Taxes................................................... 12
Supplemental Information................................ 14
Financial Statements.................................... D-1
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RISK/RETURN SUMMARY
1. WHAT IS THE PORTFOLIO'S OBJECTIVE?
The Portfolio seeks total return through a combination of
capital appreciation and, to a lesser extent, current
income, by investing in a diversified portfolio of domestic
and foreign common stocks engaged in a wide range of
telecommunications activities.
You can participate in the Portfolio by purchasing units.
Each unit represents an equal share of the stocks in the
Portfolio and receives an equal share of income and
principal distributions, if any.
2. WHAT IS THE PORTFOLIO'S INVESTMENT STRATEGY?
The Portfolio contains 33 stocks in the telecommunications
industry. The stocks were selected after we considered:
o the quality of the common stocks;
o capitalization of the issuers;
o the issuers' earnings and dividend payment records; and
o the prices of the common stocks.
As of the initial date of deposit (August 13, 1998), the
screening process included:
o identifying companies with two-year growth potential;
o performing a thorough fundamental financial analysis; and
o evaluating liquidity, market share and timeliness of
purchase.
The common stocks chosen for the Portfolio were initially
considered by the Defined Funds Research Group to be well
positioned to benefit from:
o advances in telecommunications technology;
o increasing demand for telecommunications products and
services; and
o global expansion of telecommunications services (especially
from privatization of government-owned facilities).
The Portfolio plans to hold the stocks in the Portfolio for
about one more year. At the end of approximately one year,
we will liquidate the Portfolio and apply a similar
Strategy to select a new portfolio, if available.
3. WHAT INDUSTRIES ARE REPRESENTED IN THE PORTFOLIO?
Based upon the principal business of each issuer and
current market values, the Portfolio represents the
following sectors of the telecommunications industry:
APPROXIMATE
PORTFOLIO
PERCENTAGE
o International 36%
o Telecommunications Equipment 34
o Telecommunications Networking 10
o Telecommunications Services
Regional Bells 9
Independents 4
Long Distance 6
Wireless 1
4. WHAT ARE THE SIGNIFICANT RISKS?
YOU CAN LOSE MONEY BY INVESTING IN THE PORTFOLIO. THIS CAN
HAPPEN FOR VARIOUS REASONS, INCLUDING:
o Stock prices can be volatile.
o Share prices may decline during the life of the Portfolio.
o Because the Portfolio is concentrated in the
telecommunications industry, adverse developments in this
industry may affect the value of your units.
o Approximately 36% of the Portfolio are stocks of foreign
issuers.
o The Portfolio may continue to purchase or hold the stocks
originally selected even though their market value or yield
may have changed.
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5. IS THIS PORTFOLIO APPROPRIATE FOR YOU?
Yes, if you want a combination of capital appreciation and,
to a lesser extent, current income. You will benefit from a
professionally selected and supervised portfolio whose risk
is reduced by investing in equity securities of different
issuers.
The Portfolio is not appropriate for you if you are not
comfortable with the Strategy or are unwilling to take the
risk involved with an equity investment. It may not be
appropriate for you if you are seeking preservation of
capital or high current income.
6. WHAT ARE THE PORTFOLIO'S FEES AND EXPENSES?
This table shows the costs and expenses you may pay,
directly or indirectly, when you invest in the Portfolio.
ESTIMATED ANNUAL OPERATING EXPENSES
AMOUNT
PER 1,000
UNITS
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$ 0.90
Trustee's Fee
$ 0.70
Portfolio Supervision,
Bookkeeping and
Administrative Fees
(including updating
expenses)
$ 0.62
Other Operating Expenses
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$ 2.22
TOTAL
The Sponsors historically paid updating
expenses.
INVESTOR FEES
2.75%
Maximum Sales Fee (Load) on new purchases
(as a percentage of $1,000 invested)
You will pay an up-front sales fee of 1.00%, as well as a
deferred sales fee of $2.50 per 1,000 units monthly to be
deducted from the net asset value of the Portfolio
September 1, 1999, through March 1, 2000.
The maximum sales fees are as follows:
YOUR MAXIMUM
SALES FEE
IF YOU INVEST: WILL BE:
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Less than $50,000 2.75%
$ 50,000 to $99,999 2.50%
$100,000 to $249,999 2.00%
$250,000 to $999,999 1.75%
$1,000,000 or more 1.00%
7. IS THE PORTFOLIO MANAGED?
Unlike a mutual fund, the Portfolio is not managed and
stocks are not sold because of market changes. The Sponsors
monitor the portfolio and may instruct the Trustee to sell
securities under certain limited circumstances. However,
given the investment philosophy of the Portfolio, the
Sponsors are not likely to do so.
8. HOW DO I BUY UNITS?
The minimum investment is $250.
You can buy units from any of the Sponsors. The Sponsors are
listed later in this prospectus.
UNIT PRICE PER 1,000 UNITS $1,599.74
(as of July 31, 1999)
Unit price is based on the net asset value of the Portfolio
plus the up-front sales fee.
The Portfolio stocks are valued by the Trustee on the basis
of their closing prices at 4:00 p.m. Eastern time every
business day. Unit price changes every day with changes in
the prices of the stocks.
9. HOW DO I SELL UNITS?
You may sell your units at any time to any Sponsor or the
Trustee for the net asset value determined at the close of
business on the date of sale.
10. HOW ARE DISTRIBUTIONS MADE AND TAXED?
The Fund pays distributions of any dividend income, net of
expenses, on the 25th of December, 1999 and June 2000, if
you own units on the 10th of those months. Distributions of
ordinary income will be dividends for federal income tax
purposes and may be eligible for the dividends-received
deduction for corporations. Distributions to foreign
investors will generally be subject to withholding taxes.
11. WHAT OTHER SERVICES ARE AVAILABLE?
REINVESTMENT
You may choose to reinvest your distributions into
additional units of the Portfolio. You will pay only the
deferred sales fee remaining at the time of reinvestment.
Unless you choose reinvestment, you will receive your
distributions in cash.
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WHAT YOU CAN EXPECT FROM YOUR INVESTMENT
INCOME
The Portfolio will pay to you any income it has received twice during the year.
Because the Portfolio generally pays dividends as they are received, individual
income payments will fluctuate based upon the amount of dividends declared and
paid by each issuer. Other reasons your income may vary are:
o changes in the Portfolio because of additional securities purchases or
sales;
o a change in the Portfolio's expenses; and
o the amount of dividends declared and paid.
There can be no assurance that any dividends will be declared or paid.
RECORDS AND REPORTS
You will receive:
o a notice from the Trustee if new equity securities are deposited in exchange
or substitution for equity securities originally deposited;
o annual reports on Portfolio activity; and
o annual tax information. This will also be sent to the IRS. You must report the
amount of income received during the year. Please contact your tax advisor in
this regard.
You may request audited financial statements of the Portfolio from the Trustee.
You may inspect records of Portfolio transactions at the Trustee's office during
regular business hours.
THE RISKS YOU FACE
CONCENTRATION RISK
When stocks in a particular industry make up 25% or more of the Portfolio, it is
said to be 'concentrated' in that industry, which makes the Portfolio less
diversified.
Here is what you should know about the Portfolio's concentration in stocks of
the telecommunications industry.
These companies:
o provide local, long-distance, wireless, cable television and internet services
and information systems;
o manufacture of telecommunications products; and
o operate voice, data and video telecommunications networks.
Payment on common stocks of companies in this industry generally depends upon:
o the amount and growth of customer demand;
o the level of rates they are allowed to charge; and
o the effects of inflation on the cost of providing services and the rate of
technological innovation.
The domestic telecommunications industry is characterized by increasing
competition in all sectors and regulation by the Federal Communications
Commission and various state regulatory authorities. To meet increasing
competition, companies may have to commit substantial capital, particularly in
the formulation of new products and services using new technology.
Telecommunications companies in both developed and emerging countries are
undergoing significant change due to varying and evolving levels of governmental
regulation or deregulation and other factors. As a result, competitive pressures
are intense and the securities of such companies may be subject to significant
price volatility.
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In addition, all telecommunications companies in both developed and emerging
countries are subject to the additional risk that technological innovations will
make their products and services obsolete.
While the worldwide market for telecommunications equipment is expected to grow,
we cannot predict the overall effect on the Portfolio of factors such as:
o competing technologies;
o increasing capital requirements;
o protectionist actions by foreign governments; and
o demand for new technologies.
The international companies in the Portfolio consist predominantly of former
government owned telecommunications systems that have been privatized in stages.
We cannot predict whether such privatization will continue in the future or
what, if any, effect this will have on the Portfolio.
FOREIGN ISSUER RISK
Certain of the issuers of the Stocks are foreign issuers, whose stocks trade in
ADR form. Investments in securities of foreign issuers involve risks that are
different from investments in securities of domestic issuers.
They may include:
o political and economic developments;
o possibility of withholding taxes;
o exchange controls or other governmental restrictions on the payment of
dividents;
o conversion of local currency to U.S. dollars upon the sale of Portfolio
Securities;
o less publicly available information; and
o absence of uniform accounting, auditing and financial reporting standards,
practices and requirements.
American Depositary Shares and Receipts
American depositary shares and receipts are issued by an American bank or trust
company to evidence ownership of underlying common stock issued by a foreign
corporation and deposited in a depositary facility. The terms and conditions of
the depositary facility may result in less liquidity or lower market prices for
the ADRs than for the underlying shares. Certain of the Portfolio Securities
were purchased in ADR form in the United States.
LITIGATION AND LEGISLATION RISKS
We do not know of any pending litigation that might have a material adverse
effect upon the Portfolio.
Future tax legislation could affect the value of the Portfolio by:
o reducing the dividends-received deduction or
o increasing the corporate tax rate resulting in less money available for
dividend payments.
SELLING UNITS
You can sell your units at any time for a price based on their net asset value.
Your net asset value is calculated each business day by:
o adding the value of the Portfolio Securities, cash and any other Portfolio
assets;
o subtracting accrued but unpaid Portfolio expenses, unreimbursed Trustee
advances, cash held to buy back units or for distribution to investors,
and any other Portfolio liabilities; and
o dividing the result by the number of outstanding units.
Your net asset value when you sell may be more or less than your cost because of
sales
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fees, market movements and changes in the Portfolio.
If you sell your units before the final deferred sales fee installment, the
amount of any remaining payments will be deducted from your proceeds.
SPONSORS' SECONDARY MARKET
While we are not obligated to do so, we will buy back units at net asset value.
We may resell the units to other buyers or to the Trustee.
We have maintained a secondary market continuously for more than 28 years, but
we could discontinue it without prior notice for any business reason.
SELLING UNITS TO THE TRUSTEE
Regardless of whether we maintain a secondary market, you can sell your units to
the Trustee at any time by contacting your broker, dealer or financial
institution that holds your units in street name. Sometimes, additional
documents are needed such as a trust document, certificate of corporate
authority, certificate of death or appointment as executor, administrator or
guardian.
Within seven days after your request and the necessary documents are received,
the Trustee will mail a check to you. Contact the Trustee for additional
information.
As long as we are maintaining a secondary market, the Trustee will sell your
units to us at a price based on net asset value. If there is no secondary
market, the Trustee will sell your units in the over-the-counter market if it
believes it can obtain a higher price. In that case, you will receive the net
proceeds of the sale.
If the Portfolio does not have cash available to pay you for the units you are
selling, the agent for the Sponsors will select securities to be sold. These
sales could be made at times when the securities would not otherwise be sold and
may result in your receiving less than you paid for your unit and also reduce
the size and diversity of the Portfolio.
If you sell units with a value of at least $250,000, you may choose to receive
your distribution 'in kind.' If you so choose, you will receive securities and
cash with a total value equal to the price of your units. The Trustee will try
to distribute securities in the portfolio pro rata, but it reserves the right to
distribute only one or a few securities. The Trustee will act as your agent in
an in-kind distribution and will either hold the securities for your account or
transfer them as you instruct. You must pay any transaction costs as well as
transfer and ongoing custodial fees on sales of securities distributed in kind.
There could be a delay in paying you for your units:
o if the New York Stock Exchange is closed (other than customary weekend and
holiday closings);
o if the SEC determines that trading on the New York Stock Exchange is
restricted or that an emergency exists making sale or evaluation of the
securities not reasonably practicable; and
o for any other period permitted by SEC order.
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ROLLOVER/EXCHANGE OPTION
When this Portfolio is about to terminate, you may have the option to roll your
proceeds into the next Series, if one is available.
If you hold your Units with one of the Sponsors and notify your financial
adviser by August 11, 2000, your units will be redeemed and certain distributed
securities plus the proceeds from the sale of the remaining distributed
securities will be reinvested in units of the new Tele-Global Portfolio. If you
decide not to roll over your proceeds, you will receive a cash distribution (or,
if you so choose, in-kind distribution) after the Portfolio terminates.
The Portfolio will terminate by September 8 2000. You may, by written notice to
the Trustee at least ten business days prior to termination, elect to receive an
in-kind distribution of your pro rata share of the Securities remaining in the
Portfolio at that time (net of your share of expenses). Of course you can sell
your Units at any time prior to termination.
You may exchange units of this Portfolio for units of another Select or Focus
Series or certain other Defined Asset Funds any time before this Portfolio
terminates. If you continue to hold your Units, you may exchange units of this
Portfolio for units of certain other Defined Asset Funds at a reduced sales fee
if your investment goals change. To exchange units, you should talk to your
financial professional about what Portfolios are exchangeable, suitable and
currently available.
We may amend or terminate the options to exchange your units or roll your
proceeds at any time without notice.
HOW THE FUND WORKS
PRICING
Units are charged a combination of initial and deferred sales fees.
The deferred sales fee is generally a monthly charge of $2.50 per 1,000 units
and is accrued in seven monthly installments. Units redeemed or repurchased
prior to the accrual of the final deferred sales fee installment will have the
amount of any remaining installments deducted from the redemption or repurchase
proceeds or deducted in calculating an in-kind distribution; however, 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.
It is anticipated that securities will not be sold to pay the deferred sales fee
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.
EVALUATIONS
The Trustee values the securities on each business day (i.e., any day other than
Saturdays, Sundays and the following holidays as observed by the New York Stock
Exchange: New Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Good
Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving and Christmas).
If the securities are listed on a national securities exchange or the Nasdaq
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National Market, evaluations are generally based on closing sales prices on that
exchange or that system or, if closing sales prices are not available, at the
mean between the closing bid and offer prices.
INCOME
o The annual income per unit, 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 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.
o Each unit receives an equal share of distributions of dividend income 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. The Trustee credits dividends
received to an Income Account and other receipts to a Capital Account. The
Trustee may establish a reserve account by withdrawing from these accounts
amounts it considers appropriate to pay any material liability. These accounts
do not bear interest.
EXPENSES
The Trustee is paid a fee monthly. It also benefits when it holds cash for the
Portfolio in non-interest bearing accounts. The Trustee may also receive
additional amounts:
o for extraordinary services and costs of indemnifying the Trustee and the
Sponsors;
o costs of actions taken to protect the Portfolio and other legal fees and
expenses;
o expenses for keeping the Portfolio's registration statement current; and
o Portfolio termination expenses and any governmental charges.
The Sponsors are currently reimbursed up to 70 cents per 1,000 units annually
for providing portfolio supervisory, bookkeeping and administrative services and
for any other expenses properly chargeable to the Portfolio. Legal, typesetting,
electronic filing and regulatory filing fees and expenses associated with
updating the Portfolio's registration statement yearly are also now chargeable
to the Portfolio. While this fee may exceed the amount of these costs and
expenses attributable to this Portfolio, the total of these fees for all Series
of Defined Asset Funds will not exceed the aggregate amount attributable to all
of these Series for any calendar year. Certain of these expenses were previously
paid for by the Sponsors.
The Trustee's and Sponsors'fees may be adjusted for inflation without investors'
approval.
The deferred sales fees you owe are paid from the Capital Account. Although we
may collect the deferred sales charge monthly, to keep Units more fully invested
we do not currently plan to pay the deferred sales charge until after the
rollover notification date.
The Sponsors will pay advertising and selling expenses at no charge to the
Portfolio. If Portfolio expenses exceed initial estimates, the Portfolio will
owe the excess. The Trustee has a lien on Portfolio assets to secure
reimbursement of Portfolio expenses and may sell securities if cash is not
available.
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PORTFOLIO CHANGES
If we maintain a secondary market in units but are unable to sell the units that
we buy in the secondary market, we will redeem units, which will affect the size
and composition of the portfolio.
We decide whether to offer units for sale that we acquire in the secondary
market after reviewing:
o diversity of the Portfolio;
o size of the Portfolio relative to its original size;
o ratio of Portfolio expenses to income; and
o cost of maintaining a current prospectus.
PORTFOLIO TERMINATION
When the Portfolio is about to terminate you will receive a notice, and you will
be unable to sell your units after that time. Unless you choose to receive an
in-kind distribution of securities, we will sell any remaining securities, and
you will receive your final distribution in cash.
You will pay your share of the expenses associated with termination, including
brokerage costs in selling securities. This may reduce the amount you receive as
your final distribution.
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.
TRUST INDENTURE
The Portfolio is a 'unit investment trust' governed by a Trust Indenture, a
contract among the Sponsors and the Trustee, which sets forth their duties and
obligations and your rights. A copy of the Indenture is available to you on
request to the Trustee. The following summarizes certain provisions of the
Indenture.
The Sponsors and the Trustee may amend the Indenture without your consent:
o to cure ambiguities;
o to correct or supplement any defective or inconsistent provision;
o to make any amendment required by any governmental agency; or
o to make other changes determined not to be materially adverse to your best
interest (as determined by the Sponsors).
Investors holding 51% of the units may amend the Indenture. Every investor must
consent to any amendment that changes the 51% requirement. No amendment may
reduce your interest in the Portfolio without your written consent.
The Trustee may resign by notifying the Sponsors. The Sponsors may remove the
Trustee without your consent if:
o it fails to perform its duties;
o it becomes incapable of acting or bankrupt or its affairs are taken over by
public authorities; or
o the Sponsors determine that its replacement is in your best interest.
Investors holding 51% of the units may remove the Trustee. The Trustee may
resign or be removed by the Sponsors without the consent of investors. The
resignation or removal of the Trustee becomes effective when a successor accepts
appointment. The Sponsors will try to appoint a successor promptly; however, if
no successor has accepted within 30 days after notice of
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resignation, the resigning Trustee may petition a court to appoint a successor.
Any Sponsor may resign as long as one Sponsor with a net worth of $2 million
remains and agrees to the resignation. The remaining Sponsors and the Trustee
may appoint a replacement. If there is only one Sponsor and it fails to perform
its duties or becomes bankrupt the Trustee may:
o remove it and appoint a replacement Sponsor;
o liquidate the Portfolio; or
o continue to act as Trustee without a Sponsor.
Merrill Lynch, Pierce, Fenner & Smith Incorporated acts as agent for the
Sponsors.
The Trust Indenture contains customary provisions limiting the liability of the
Trustee and the Sponsors.
LEGAL OPINION
Davis Polk & Wardwell, 450 Lexington Avenue, New York, New York 10017, as
special counsel for the Sponsors, has given an opinion that the units are
validly issued.
AUDITORS
Deloitte & Touche LLP, 2 World Financial Center, New York, New York 10281,
independent accountants, audited the Statement of Condition included in this
prospectus.
SPONSORS
The Sponsors are:
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED (a wholly-owned subsidiary of
Merrill Lynch & Co., Inc.)
P.O. Box 9051,
Princeton, NJ 08543-9051
SALOMON SMITH BARNEY INC. (an indirectly wholly-owned subsidiary of Citigroup
Inc.)
388 Greenwich Street--23rd Floor,
New York, NY 10013
DEAN WITTER REYNOLDS INC. (a principal operating subsidiary of Morgan Stanley
Dean Witter & Co.)
Two World Trade Center--59th Floor,
New York, NY 10048
PAINEWEBBER INCORPORATED (a wholly-owned subsidiary of PaineWebber Group Inc.)
1285 Avenue of the Americas,
New York, NY 10019
Each Sponsor is a Delaware corporation and it, or its predecessor, has acted as
sponsor to many unit investment trusts. As a registered broker-dealer each
Sponsor buys and sells securities (including investment company shares) for
others (including investment companies) and participates as an underwriter in
various selling groups.
TRUSTEE
The Bank of New York, 101 Barclay Street-- 17W, New York, New York 10268, is the
Trustee. It is supervised by the Federal Deposit Insurance Corporation, the
Board of Governors of the Federal Reserve System and New York State banking
authorities.
UNDERWRITERS' AND SPONSORS' PROFITS
Underwriters receive sales charges when they sell units. Sponsors also realize a
profit or loss on deposit of the securities shown under Defined Portfolio. Any
cash made available by you to the Sponsors before the settlement date for those
units may be used in the Sponsors' businesses to the extent permitted by federal
law and may benefit the Sponsors.
A Sponsor or Underwriter may realize profits or sustain losses on stocks in the
Portfolio
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which were acquired from underwriting syndicates of which it was a member.
In maintaining a secondary market, 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 or redeem them.
PUBLIC DISTRIBUTION
The Sponsors do not intend to qualify units for sale in any foreign countries.
This prospectus does not constitute an offer to sell units in any country where
units cannot lawfully be sold.
CODE OF ETHICS
Merrill Lynch, as agent for the Sponsors, has adopted a code of ethics requiring
reporting of personal securities transactions by its employees with access to
information on portfolio transactions. The goal of the code is to prevent fraud,
deception or misconduct against the Portfolio and to provide reasonable
standards of conduct.
YEAR 2000 ISSUES
Many computer systems were designed in such a way that they may be unable to
distinguish between the year 2000 and the year 1900 (commonly known as the 'Year
2000 Problem'). We do not expect that the computer system changes necessary to
prepare for the Year 2000 will cause any major operational difficulties for the
Portfolio. The Year 2000 Problem may adversely affect the issuers of the
securities contained in the Portfolio, but we cannot predict whether any impact
will be material to the Portfolio as a whole.
ADVERTISING AND SALES LITERATURE
Advertising and sales literature may include brief descriptions of the principal
businesses of the companies represented in the Portfolio, the research analysis
of why they were selected, and a chronology of developments in the
telecommunications industry.
TAXES
The following summarizes the material income tax consequences of holding Units.
It assumes that you are not a dealer, financial institution, insurance company
or other investor with special circumstances or subject to special rules. You
should consult your own tax adviser about your particular circumstances.
In the opinion of our counsel, under existing law:
GENERAL TREATMENT OF THE FUND AND YOUR INVESTMENT
The Portfolio intends to qualify for special tax treatment as a regulated
investment company so that it will not be subject to federal income tax on the
portion of its taxable income that it distributes to investors in a timely
manner.
DISTRIBUTIONS
Distributions to you of the Portfolio's dividend income and of the Portfolio's
gains from Securities it has held for one year or less will generally be taxed
to you as ordinary income, to the extent of the Portfolio's taxable income not
attributable to the Portfolio's net capital gain. Distributions to you in excess
of the Portfolio's taxable income will be treated as a return of capital and
will reduce your basis in your Units. To the extent such distributions
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exceed your basis, they will be treated as gain from the sale of your Units.
Distributions to you that are treated as ordinary income will constitute
dividends for federal income tax purposes. Corporate investors may be eligible
for the 70% dividends-received deduction with respect to these distributions.
You should consult your tax adviser.
Distributions to you of the Portfolio's net capital gain will generally be
taxable to you as long-term capital gain, regardless of how long you have held
your units, unless the Portfolio terminates in less than one year, in which case
all distributions from the Portfolio will generally be taxed to you as ordinary
income. Distributions that are taxable to you as long-term capital gains may be
eligible for the 20% maximum federal tax rate. You should consult your tax
adviser in this regard.
Dividends received by the Portfolio from foreign issuers will in most cases be
subject to withholding taxes, although these taxes may be reduced by treaties
between the United States and the relevant country.
GAIN OR LOSS UPON DISPOSITION
You will generally recognize gain or loss when you dispose of your units by
sale, redemption or exchange. If you choose to roll over your investment in the
Portfolio into a new portfolio (including into another Teleglobal Trust), you
will generally recognize capital gain but you may not be entitled to a deduction
for any capital loss recognized on the rollover. You should consult your tax
adviser in this regard.
If you receive securities upon redemption of your units (including pursuant to
the rollover option), you will generally recognize gain or loss equal to the
difference between your basis in your units and the fair market value of the
securities received in redemption.
If your net long-term capital gains exceed your net short-term capital losses,
the excess may be eligible for the 20% maximum federal tax rate. Any capital
gain or loss that you recognize on a disposition of your Units will be long-term
if you held your Units for more than one year and short-term otherwise. However,
any capital loss on the sale or redemption of a unit you have held for six
months or less will be a long-term capital loss to the extent of any capital
gain dividends previously distributed to you by the Portfolio. Because the
deductibility of capital losses is subject to limitations, you may not be able
to deduct all of your capital losses. You should consult your tax adviser in
this regard.
YOUR BASIS IN THE SECURITIES
Your aggregate basis in the Units will generally be equal to the cost of your
Units, including the initial sales charge. You should not increase your basis in
your Units by deferred sales charges or organizational expenses, because the tax
reporting form and annual statements you receive will be based on the net
amounts paid to you, from which these expenses will already be deducted. You
should not increase your basis in your Units by deferred sales charges or
organizational expenses.
FOREIGN INVESTORS
If you are a foreign investor and you are not engaged in a U.S. trade or
business, you
13
<PAGE>
generally will be subject to 30% withholding tax (or a lower applicable treaty
rate) on distributions. You should consult your tax adviser about the possible
application of federal, state and local, and foreign taxes.
RETIREMENT PLANS
You may wish to purchase units for an Individual Retirement Account ('IRAs') or
other retirement plan. Generally, capital gains and income received in each of
these plans are exempt from federal taxation. All distributions from these types
of plans are generally treated as ordinary income but may, in some cases, be
eligible for tax-deferred rollover treatment. You should consult your attorney
or tax adviser about the specific tax rules relating to these plans. These plans
are offered by brokerage firms, including the Sponsors of this Portfolio, and
other financial institutions. Fees and charges with respect to such plans may
vary.
SUPPLEMENTAL INFORMATION
You can receive at no cost supplemental information about the Portfolio by
calling the Trustee. The supplemental information includes more detailed risk
disclosure and general information about the structure and operation of the
Portfolio. The supplemental information is also available from the SEC.
14
EQUITY INVESTOR FUND,
CONCEPT SERIES, TELE-GLOBAL TRUST 4
DEFINED ASSET FUNDS
REPORT OF INDEPENDENT ACCOUNTANTS
The Sponsors, Trustee and Holders
of Equity Investor Fund,
Concept Series, Tele-Global Trust 4
Defined Asset Funds:
We have audited the accompanying statement of condition of Equity
Investor Fund, Concept Series, Tele-Global Trust 4, Defined Asset Funds,
including the portfolio, as of July 31, 1999 and the related statements
of operations and of changes in net assets for the period August 14, 1998
to July 31, 1999. These financial statements are the responsibility
of the Trustee. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Securities
owned at July 31, 1999, as shown in such portfolio, were
confirmed to us by The Bank of New York, 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 statements referred to above present
fairly, in all material respects, the financial position of Equity
Investor Fund, Concept Series, Tele-Global Trust 4, Defined Asset
Funds at July 31, 1999 and the results of its operations and changes
in its net assets for the above-stated period in conformity with
generally accepted accounting principles.
DELIOTTE & TOUCHE LLP
New York, NY
September 30, 1999
D - 1
<PAGE>
EQUITY INVESTOR FUND,
CONCEPT SERIES, TELE-GLOBAL TRUST 4
DEFINED ASSET FUNDS
STATEMENT OF CONDITION
AS OF JULY 31,1999
<TABLE>
<S> <C> <C>
TRUST PROPERTY:
Investment in marketable securities - at value
(cost $52,796,664) (Note 1)................... $81,514,704
Dividends receivable............................ 115,665
Receivable from securities sold................. 689,939
Cash............................................ 45,204
_____________
Total trust property.................. 82,365,512
Less Liabilities:
Accrued expenses payable........................ $ 40,446
Deferred Sales Charge Payable................... 930,199
Redemption Payable.............................. 693,501 1,664,146
____________ _____________
NET ASSETS, REPRESENTED BY:
50,964,214 units of fractional undivided
interest outstanding (Note 3)................. 80,582,451
Underdistributed net investment income.......... 118,915
____________
$80,701,366
==============
UNIT VALUE ($80,701,366/50,964,214 units)......... $1.58349
==============
</TABLE>
See Notes to Financial Statements.
D - 2
<PAGE>
EQUITY INVESTOR FUND,
CONCEPT SERIES, TELE-GLOBAL TRUST 4
DEFINED ASSET FUNDS
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
August 14,
1998
to
July 31,
1999
<S> <C>
INVESTMENT INCOME:
Dividend income................................. $ 428,835
Trustee's fees and expenses..................... (63,719)
Sponsors' fees ................................. (20,560)
_______________
Net investment income........................... 344,556
_______________
REALIZED AND UNREALIZED LOSS ON
INVESTMENTS:
Realized gain on securities sold ............... 1,691,475
Unrealized appreciation of investments.......... 28,718,040
_______________
Net realized and unrealized loss on
investments................................... 30,409,515
_______________
NET DECREASE IN NET ASSETS RESULTING
FROM OPERATIONS................................. $30,754,071
===============
</TABLE>
See Notes to Financial Statements.
D - 3
<PAGE>
EQUITY INVESTOR FUND,
CONCEPT SERIES, TELE-GLOBAL TRUST 4
DEFINED ASSET FUNDS
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
August 14,
1998
to
July 31,
1999
<S> <C>
OPERATIONS:
Net investment income........................... $ 344,556
Realized gain on securities sold
or redeemed.................................. 1,691,475
Unrealized appreciation of investments.......... 28,718,040
_____________
Net increase in net assets resulting
from operations.............................. 30,754,071
_____________
DISTRIBUTIONS:
Income Distributions to Holders (Note 2)......... (246,162)
Principal Distributions to Holders............... (38,327)
_____________
Total Distributions.............................. (284,489)
_____________
CAPITAL SHARE TRANSACTIONS:
Issuance of 54,382,663 additional units(Note 1) 56,126,794
Redemption of 3,863,080 units (Note 5)......... (5,300,926)
Deferred sales charge.......................... (930,199)
Organizational cost............................ (108,010)
_____________
NET CAPITAL SHARE TRANSACTIONS.................... 49,787,659
_____________
NET INCREASE IN NET ASSETS........................ 80,257,241
NET ASSETS AT BEGINNING OF PERIOD................. 444,125
_____________
NET ASSETS AT END OF PERIOD....................... $80,701,366
=============
PER UNIT:
Income distributions during period.............. $.00516
=============
Principal distributions during period........... $.00086
=============
Net asset value at end of period................ $1.58349
=============
TRUST UNITS OUTSTANDING AT END OF PERIOD.......... 50,964,214
=============
</TABLE>
See Notes to Financial Statements.
D - 4
<PAGE>
EQUITY INVESTOR FUND,
CONCEPT SERIES, TELE-GLOBAL TRUST 4
DEFINED ASSET FUNDS
NOTES TO FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES
The Fund is registered under the Investment Company Act of 1940 as a Unit
Investment Trust. The following is a summary of significant accounting
policies consistently followed by the Fund in the preparation of its
financial statements. The policies are in conformity with generally
accepted accounting principles.
(a) Securities are stated at value: for securities listed on a national
securities exchange, value is based on the closing sale price on such
exchange and, for securities not so listed, value is based on current
bid price on the over-the-counter market. Realized gains or losses on
sales of securities are determined using the first-in, first-out cost
method.
(b) The Fund is not subject to income taxes. Accordingly, no provision for
such taxes is required.
(c) Dividend income is recorded on the ex-dividend dates.
2. DISTRIBUTIONS
A distribution of net investment income is made to Holders on the
twenty-fifth day of December 1998, June and December 1999 and June, 2000,
if
you own Units on the tenth day of those months. Receipts other than
dividends, after deductions for redemptions and applicable expenses, are
also distributed periodically.
3. NET CAPITAL
<TABLE>
<S> <C>
Cost of 50,964,214 units at Dates of Deposit....................................... $52,624,508
Deferred sales charge.............................................................. (930,199)
Redemptions of units - net cost of 3,863,080 units redeemed ....................... (1,375,036)
Realized gain on securities sold or redeemed....................................... 1,691,475
Net unrealized appreciation of investments......................................... 28,718,040
Principal Distributions............................................................ (38,327)
Organizational cost................................................................ (108,010)
______________
Net capital applicable to Holders.................................................. $80,582,451
==============
</TABLE>
D - 5
<PAGE>
EQUITY INVESTOR FUND,
CONCEPT SERIES, TELE-GLOBAL TRUST 4
DEFINED ASSET FUNDS
NOTES TO FINANCIAL STATEMENTS
4. As of July 31, 1999, net unrealized appreciation of investments, based on
cost for Federal income tax purposes, aggregated $28,718,040, of which $885,160
related to depreciated securities and $29,603,200 related to appreciated
securities. The aggregate cost of investment securities for Federal income tax
purposes was $52,796,664 at July 31,1999.
5. REINVESTMENT PLAN
Holders may participate in the Fund's Reinvestment Plan, subject to its
terms, by filing an appropriate notice of election.
D - 6
<PAGE>
DEFINED ASSET FUNDS - EQUITY INVESTOR FUND
CONCEPT SERIES, TELE-GLOBAL TRUST 4
PORTFOLIO
AS OF JULY 31, 1999
<TABLE>
<CAPTION>
Shares
Port- of
folio Common
No. Description of Security Stock Percent(2) Cost Value(1)
___ _______________________ ______ _________ ____ ________
<S> <C> <C> <C> <C>
1 3Com Corporation 52,650 1.56 % $ 1,914,872 $ 1,270,181
2 ADC Telecomunication, Inc. 40,860 2.23 1,200,105 1,818,270
3 ALLTEL Corporation (9) 35,175 3.10 1,667,874 2,526,005
4 AT&T Corporation (4) 24,047 1.53 1,055,997 1,248,941
5 Bell Atlantic Corporation 24,420 1.91 1,246,176 1,556,775
6 BellSouth Corporation (6) 30,680 1.81 1,231,783 1,472,640
7 British Telecommunications PLC 6,160 1.33 869,614 1,084,160
8 Cable & Wireless PLC 33,750 1.49 1,205,534 1,215,000
9 CenturyTel, Inc. (4) (10) 23,450 1.23 921,821 1,002,488
10 CISCO Systems, Inc. (4) (6) 96,700 7.37 3,704,129 6,007,488
11 ECI Telecommunications Limited 39,400 1.64 1,319,716 1,337,138
12 Ericsson Telephone Co. 64,350 2.53 1,534,617 2,063,222
13 France Telecom S.A. 11,910 1.04 900,598 850,076
14 Frontier Corporation 19,970 1.36 648,693 1,107,087
15 Harris Corporation 17,610 0.65 642,073 533,803
16 KPN NV 24,230 1.35 1,059,361 1,103,979
17 Lucent Technologies, Inc. (6) 70,910 5.66 3,263,129 4,613,582
18 Nokia Corporation (6) 40,610 4.24 2,003,604 3,454,388
19 Nortel Networks Corporation (11) 29,990 3.26 1,476,450 2,657,864
20 PairGain Technologies, Inc. 64,230 0.74 651,046 606,171
21 Portugal Telecom S.A. 16,630 0.90 769,561 732,759
22 QUALCOMM, Inc. (6) 91,690 17.55 2,643,466 14,303,640
23 SBC Communications, Inc. 53,770 3.77 2,498,592 3,074,972
24 Scientific-Atlanta, Inc. 33,690 1.51 732,045 1,229,685
25 Sprint Corporation (FON Group) (6) 34,050 2.16 1,227,120 1,759,959
26 Sprint PCS Group (3) 8,560 0.64 155,268 518,950
27 Symbol Technologies, Inc. (4) 38,170 1.84 1,312,361 1,500,558
</TABLE>
D - 7
<PAGE>
DEFINED ASSET FUNDS - EQUITY INVESTOR FUND
CONCEPT SERIES, TELE-GLOBAL TRUST 4
PORTFOLIO
AS OF JULY 31, 1999
<TABLE>
<CAPTION>
Shares
Port- of
folio Common
No. Description of Security Stock Percent(2) Cost Value(1)
___ _______________________ ______ _________ ____ ________
<S> <C> <C> <C> <C>
28 Tele Danmark A/S (6) 50,160 1.81 % $ 1,422,995 $ 1,476,585
29 Telecom Italia S.p.A 36,450 4.45 2,974,579 3,624,497
30 Telefonica S.A. (5)(7) 36,003 2.11 1,596,046 1,719,143
31 Tellabs, Inc. (6) 65,400 4.94 2,027,145 4,026,188
32 US West, Inc. 20,270 1.43 1,160,943 1,161,724
33 Vodafone Airtouch (8) 42,075 10.86 5,759,351 8,856,786
___________ ______________ _______________
100.00 % $52,796,664 $81,514,704
</TABLE>
1) See Notes to Financial Statements.
2) Based on Value.
3) Result of spinoff from Sprint Corporation (FON Group)
4) Received 3 for 2 stock split
5) Received 3 for 1 stock split
6) Received 2 for 1 stock split
7) Received two 2% stock dividends
8) Merged with AirTouch Communications, Inc (.5 shares and $9 for 1 share)
9) Merged with Aliant Communications, Inc. (.67 shares for 1 share)
10) Name changed from Century Telephone Enterprises, Inc.
11) Name changed from Northern Telecom Limited
D - 8
<PAGE>
Defined
Asset FundsSM
HAVE QUESTIONS ? EQUITY INVESTOR FUND
Request the most CONCEPT SERIES
recent free Information TELE-GLOBAL TRUST 4
Supplement that gives more (A Unit Investment Trust)
details about the Fund, ---------------------------------------
by calling: This Prospectus does not contain
The Bank of New York complete information about the
1-800-221-7771 investment company filed with the
Securities and Exchange Commission in
Washington, D.C. under the:
o Securities Act of 1933 (file no.
333-58523) and
o Investment Company Act of 1940 (file
no. 811-3044).
TO OBTAIN COPIES AT PRESCRIBED RATES--
WRITE: Public Reference Section of the
Commission
450 Fifth Street, N.W., Washington,
D.C. 20549-6009
CALL: 1-800-SEC-0330.
VISIT: http://www.sec.gov.
---------------------------------------
No person is authorized to give any
information or representations about
this Fund not contained in this
Prospectus or the Information
Supplement, and you should not rely on
any other information.
---------------------------------------
When units of this Fund are no longer
available, this Prospectus may be used
as a preliminary prospectus for a
future series, but some of the
information in this Prospectus will be
changed for that series.
Units of any future series may not be
sold nor may offers to buy be accepted
until that series has become effective
with the Securities and Exchange
Commission. No units can be sold in any
State where a sale would be illegal.
70102--11/99
