<PAGE>
As filed with the Securities and Exchange Commission on March 12, 1999
Registration No. 333-72365
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------------------------
Amendment No. 2
to
Form S-6
------------------------------------------
FOR REGISTRATION UNDER THE SECURITIES ACT
OF 1933 OF SECURITIES OF UNIT INVESTMENT
TRUSTS REGISTERED ON FORM N-8B-2
------------------------------------------
A. Exact name of trust:
EQUITY INVESTOR FUND
CONCEPT SERIES
BABY BOOM ECONOMY PORTFOLIOSSM 1999 SERIES
DEFINED ASSET FUNDS
B. Name of depositor:
MERRILL LYNCH, PIERCE, FENNER & SMITH INC.
PAINEWEBBER INCORPORATED
DEAN WITTER REYNOLDS INC.
C. Complete addresses of depositors' principal executive offices:
MERRILL LYNCH, PIERCE,
FENNER &
SMITH INCORPORATED
Unit Investment Trust
Division
P.O. Box 9051
Princeton, NJ 08543-9051 PAINEWEBBER INCORPORATED
1285 Avenue of the
Americas
New York, NY 10019
DEAN WITTER REYNOLDS INC.
Two World Trade
Center--59th Floor
New York, NY 10048
D. Names and complete addresses of agents for service:
TERESA KONCICK, ESQ.
P.O. Box 9051
Princeton, NJ 08543-9051 ROBERT E. HOLLEY
1200 Harbor Blvd.
Weehawken, NJ 07087
Copies to: DOUGLAS LOWE, ESQ.
PIERRE DE SAINT PHALLE, Dean Witter Reynolds Inc.
ESQ. Two World Trade
450 Lexington Avenue Center--59th Floor
New York, NY 10017 New York, NY 10048
E. Title of Securities Being Registered:
An indefinite number of Units of Beneficial Interest pursuant to Rule 24f-2
promulgated under the Investment Company Act of 1940, as amended.
F. Approximate date of proposed sale to public:
As soon as practicable after the effective date of the Registration Statement.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL HEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933 OR ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO
SAID SECTION 8(a), MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
Preliminary Prospectus Subject to Completion, Dated March 12, 1999
Defined Asset FundsSM
- --------------------------------------------
- ----------------------------------
Equity Investor Fund
Concept Series
Baby Boom Economy PortfoliosSM
1999 Series
(A Unit Investment Trust)
o Lifestage Portfolios
-- Adding Growth
-- Accumulating Assets
-- Adding Income
o Designed to Take Advantage of the Economic
Impact of the Baby Boom Generation
o Opportunity for Asset Allocation
-------------------------------------------------
Sponsors: The Securities and Exchange Commission has not
Merrill Lynch, approved or disapproved these Securities or
Pierce, Fenner & Smith passed upon the adequacy of this prospectus. Any
Incorporated representation to the contrary is a criminal
PaineWebber Incorporated offense.
Dean Witter Reynolds Inc. Prospectus dated , 1999.
<PAGE>
The information in this prospectus is not complete and may be changed. We may
not sell these Securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and is not soliciting an offer to buy these Securities
in any state where the offer or sale is not permitted.
<PAGE>
- --------------------------------------------------------------------------------
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, equity portfolios and international bond and
equity portfolios.
Defined Asset Funds offer a number of advantages:
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, tolerance for risk 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.
Contents
Page
-----------
Adding Growth Portfolio
Risk/Return Summary and Portfolio.................... 3
Accumulating Assets Portfolio
Risk/Return Summary and Portfolio.................... 6
Adding Income Portfolio
Risk/Return Summary and Portfolio.................... 9
What You Can Expect From Your
Investment........................................... 12
Income............................................... 12
Records and Reports.................................. 12
The Risks You Face...................................... 12
Foreign Issuer Risk.................................. 12
Interest Rate Risk on the Treasury Securities........ 13
Concentration Risk................................... 13
Litigation and Legislation Risks..................... 13
Selling or Exchanging Units............................. 13
Sponsors' Secondary Market........................... 14
Selling Units to the Trustee......................... 14
Rollover/Exchange Option............................. 15
How The Portfolio Works................................. 15
Pricing.............................................. 15
Evaluations.......................................... 15
Income............................................... 16
Expenses............................................. 16
Portfolio Termination................................ 17
No Certificates...................................... 17
Trust Indenture...................................... 17
Legal Opinion........................................ 18
Auditors............................................. 18
Sponsors............................................. 19
Trustee.............................................. 19
Underwriters' and Sponsors' Profits.................. 19
Public Distribution.................................. 20
Code of Ethics....................................... 20
Year 2000 Issues..................................... 20
Taxes................................................... 20
Supplemental Information................................ 21
Financial Statements.................................... 22
Report of Independent Accountants.................... 22
Statements of Condition.............................. 22
2
<PAGE>
- --------------------------------------------------------------------------------
Adding Growth Portfolio--Risk/Return Summary
1. What is the Portfolio's Objective?
The Portfolio seeks capital appreciation by investing in a
diversified portfolio of global equity securities for
approximately one year.
2. What is the Portfolio's Investment Strategy?
o The Portfolio plans to invest in a number of stocks favored
by demographic trends-- companies which should experience
growth as the 'baby boomer' generation grows older. Our
Portfolio Consultants are Wall Street veterans William
Sterling and Stephen Waite, authors of the book
'Boomernomics,' and authorities on the trends of baby
boomers. Sterling and Waite, together with their team of
financial professionals, selected the securities for this
Portfolio. They believe companies in the healthcare,
technology, entertainment, leisure and financial services
industries will be best positioned to benefit from these
trends and accordingly, have selected Portfolio securities
in these industries.
o The baby boomers, the generation born between 1946 and
1964, have remarkably consistent saving, spending and
life-style patterns. Past baby boomer spending patterns
appear to have a direct correlation to the growth of
certain industries that meet the needs of baby boomers.
o The Sponsors believe that as the baby boomers mature and
adjust their lives for later years, spending patterns are
likely to have a positive effect on the industries
represented in the Portfolio.
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 industries:
Approximate
Portfolio
Percentage
o %
o %
o %
o %
o %
o %
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. Market factors may cause the
prices of the stocks to change.
o Because the Portfolio is concentrated in stocks of the
industry, adverse developments in this
industry may affect the value of your units.
o The Portfolio may continue to purchase or hold the stocks
originally selected even though their market value may have
changed or they may be subject to sell recommendations from
one or more of the Sponsors.
o Even if there are no changes in the Portfolio securities
from year to year, you still must pay tax on any gain.
5. Is this Portfolio Appropriate for You?
o The Adding Growth Portfolio was designed to meet the
financial needs of investors who still have a substantial
number of years ahead of them in the workforce, and
therefore can afford to take the risks that may yield a
better reward.
o The Adding Growth Portfolio can also represent a portion of
the equity investment in your diversified Portfolio.
o When it comes to investing, it's important to balance how
much risk you're willing to take with your investment
portfolio, with the reward that you want for the long-term.
One way to do this is to find the appropriate allocation of
stocks and bonds to provide the growth you want, with a risk
level that is comfortable for you. If you are interested in
adding growth to your investment portfolio, it may be
appropriate for you to invest heavily in stocks.
o 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.
3
<PAGE>
- --------------------------------------------------------------------------------
Adding Growth Portfolio
- --------------------------------------------------------------------------------
Baby Boom Economy Portfolios 1999 Series
Defined Asset Funds
<TABLE>
<CAPTION>
Price
Ticker Percentage Per Share Cost
Name of Issuer Symbol of Portfolio (1) to Portfolio to Portfolio (2)
- ------------------------------------------------------------------------------------------------------
<S> <C>
1. %% $
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
</TABLE>
- ------------------------------------
(1) Based on Cost to Portfolio.
(2) Valuation by the Trustee made on the basis of closing sale prices at the
evaluation time on , 1999, the business day prior to the initial
date of deposit. The value of the Securities on any subsequent business day
will vary. Sponsors' loss on deposit was $ .
------------------------------------
The securities were acquired on , 1999 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 Portfolio during the last three years. Affiliates of the Sponsors may serve
as specialists in the securities in this Portfolio on one or more stock
exchanges and may have a long or short position in any of these securities or
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 Portfolio. 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.
------------------------------------
Please note that if this prospectus is used as a preliminary
prospectus
for a future portfolio in this Series, the Portfolio will
contain different
stocks from those described above.
<PAGE>
- --------------------------------------------------------------------------------
Adding Growth Portfolio
- --------------------------------------------------------------------------------
Baby Boom Economy Portfolios 1999 Series
Defined Asset Funds
<TABLE>
<CAPTION>
Price
Ticker Percentage Per Share Cost
Name of Issuer Symbol of Portfolio (1) to Portfolio to Portfolio (2)
- ------------------------------------------------------------------------------------------------------
<S> <C>
21. %% $
22.
23.
24.
25.
26.
27.
28.
29.
30.
31.
32.
33.
34.
35.
36.
37.
38.
39.
40.
</TABLE>
- ------------------------------------
(1) Based on Cost to Portfolio.
(2) Valuation by the Trustee made on the basis of closing sale prices at the
evaluation time on , 1999, the business day prior to the initial
date of deposit. The value of the Securities on any subsequent business day
will vary. Sponsors' loss on deposit was $ .
------------------------------------
The securities were acquired on , 1999 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 Portfolio during the last three years. Affiliates of the Sponsors may serve
as specialists in the securities in this Portfolio on one or more stock
exchanges and may have a long or short position in any of these securities or
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 Portfolio. 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.
------------------------------------
Please note that if this prospectus is used as a preliminary
prospectus
for a future portfolio in this Series, the Portfolio will
contain different
stocks from those described above.
<PAGE>
- --------------------------------------------------------------------------------
Adding Growth Portfolio
- --------------------------------------------------------------------------------
Baby Boom Economy Portfolios 1999 Series
Defined Asset Funds
<TABLE>
<CAPTION>
Price
Ticker Percentage Per Share Cost
Name of Issuer Symbol of Portfolio (1) to Portfolio to Portfolio (2)
- ------------------------------------------------------------------------------------------------------
<S> <C>
41. %% $
42.
43.
44.
45.
46.
47.
48.
49.
50.
51.
52.
53.
54.
55.
56.
57.
58.
59.
60.
-----------------
100.00%
-----------------
-----------------
</TABLE>
- ------------------------------------
(1) Based on Cost to Portfolio.
(2) Valuation by the Trustee made on the basis of closing sale prices at the
evaluation time on , 1999, the business day prior to the initial
date of deposit. The value of the Securities on any subsequent business day
will vary. Sponsors' loss on deposit was $ .
------------------------------------
The securities were acquired on , 1999 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 Portfolio during the last three years. Affiliates of the Sponsors may serve
as specialists in the securities in this Portfolio on one or more stock
exchanges and may have a long or short position in any of these securities or
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 Portfolio. 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.
------------------------------------
Please note that if this prospectus is used as a preliminary
prospectus
for a future portfolio in this Series, the Portfolio will
contain different
stocks from those described above.
<PAGE>
Adding Growth Portfolio Risk/Return Summary (Continued)
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 Portfolio Operating Expenses
Amount
As a % of Per 1,000
Net Assets Units
---------- -------------
% $
Trustee's Fee
(including organizaton
costs)
% $
Portfolio Supervision,
Bookkeeping and
Administrative Fees
% $
Other Operating Expenses
---------- -------------
% $
Total
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
total deferred sales fee of $17.50 ($2.50 per 1,000 units
deducted from the Portfolio's net asset value in seven
monthly payments beginning , 1999).
The maximum sales fees are as follows:
Your maximum
sales fee
If you invest: will be:
---------------------------------------- ---------------
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%
Example
This example may help you compare the cost of investing in
the Portfolio to the cost of investing in other funds.
The example assumes that you invest $10,000 in the
Portfolio for the periods indicated and sell all your
units at the end of those periods. The example also
assumes a 5% return on your investment each year and that
the Portfolio's operating expenses stay the same. Although
your actual costs may be higher or lower, based on these
assumptions your costs would be:
1 Year 3 Years 5 Years 10 Years
$ $ $ $
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
Sponsor is not likely to do so.
8. How do I Buy Units?
The minimum investment is $ .
You can buy units from any of the Sponsors and other
broker-dealers. The Sponsors are listed later in this
prospectus. Some banks may offer units for sale through
special arrangements with the Sponsors, although certain
legal restrictions may apply. Employees of certain Sponsors
and Sponsor affiliates and non-employee directors of certain
of the Sponsors may purchase units at a reduced sales fee.
Unit Price per 1,000 Units $
(as of , 1999)
Unit price is based on the net asset value of the Portfolio
plus the up-front sales fee.
Unit price also includes organization costs. Domestic
Portfolio stocks are valued by the Trustee on the basis of
their closing prices at 4:00 p.m. Eastern time, and foreign
Portfolio stocks are valued at the U.S. dollar exchange rate
at 2:30 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, less any remaining deferred
sales fee and the costs of liquidating securities to meet
the redemption.
10. How are Distributions Made and Taxed?
The Portfolio pays distributions of any dividend income, net
of expenses, on the 25th of and ,
1999, 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.
4
<PAGE>
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 income
distributions in cash.
Exchange Privileges
You may exchange units of this Portfolio for units of
certain other Defined Asset Funds. You may also exchange
into this Portfolio from certain other funds. We charge a
reduced sales fee on exchanges.
5
<PAGE>
- --------------------------------------------------------------------------------
Accumulating Assets Portfolio--Risk/Return Summary
1. What is the Portfolio's Objective?
The Portfolio seeks total return through capital
appreciation and current income by investing approximately
75% of its assets in a diversified portfolio of global
equity securities and approximately 25% of its assets in
fixed-income securities for approximately one year.
2. What is the Portfolio's Investment Strategy?
o The Portfolio plans to invest approximately 75% of its
assets in a number of stocks favored by demographic
trends--companies which should experience growth as the
'baby boomer' generation grows older. Our Portfolio
Consultants are Wall Street veterans William Sterling and
Stephen Waite, authors of the book 'Boomernomics,' and
authorities on the trends of baby boomers. Sterling and
Waite, together with their team of financial professionals,
selected the securities for this Portfolio. They believe
companies in the healthcare, technology, entertainment,
leisure and financial services industries will be best
positioned to benefit from these trends and accordingly,
have selected Portfolio securities in these industries.
o The baby boomers, the generation born between 1946 and 1964,
have remarkably consistent saving, spending, and life-style
patterns. Past baby boomer spending patterns appear to have
a direct correlation to the growth of certain industries
that meet the needs of baby boomers.
o The Sponsors believe that as the baby boomers mature and
adjust their lives for later years, spending patterns are
likely to have a positive effect on the industries
represented in the Portfolio.
o The Portfolio will invest approximately 25% of its assets in
fixed-income securities consisting of U.S. Government
Treasury Securities with various maturities.
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 industries:
Approximate
Portfolio
Percentage
o %
o %
o %
o %
o %
o %
o %
o U.S. Government Treasury Securities 25%
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. Market factors may cause the
prices of the stocks to change.
o The asset allocation percentages of the Portfolio are
calculated as of the date of deposit. Asset allocation
percentages may vary on any subsequent day due to
fluctuations in the market value of the Portfolio
securities.
o Rising interest rates can reduce the value of your units.
o Generally, fixed income securities with longer maturities
will change in value more than those with shorter
maturities.
o Because the Portfolio is concentrated in stocks, adverse
developments in this industry may affect the value of your
units.
o Even if there are no changes in the fixed income or equity
Securities in the Portfolio from year to year, you still
must pay taxes on any gain.
o The Portfolio may continue to purchase or hold the
securities originally selected even though their market
value may have changed, or they may be subject to sell
recommendations from one or more of the Sponsors.
6
<PAGE>
- --------------------------------------------------------------------------------
Accumulating Assets Portfolio
- --------------------------------------------------------------------------------
Baby Boom Economy Portfolios 1999 Series
Defined Asset Funds
<TABLE>
<CAPTION>
Price
Ticker Percentage Per Share Cost
Name of Issuer Symbol of Portfolio (1) to Portfolio to Portfolio (2)
- ------------------------------------------------------------------------------------------------------
Equity Securities (75%)
<S> <C>
1. % $ $
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
</TABLE>
- ------------------------------------
(1) Based on Cost to Portfolio.
(2) Valuation by the Trustee made on the basis of closing sale prices at the
evaluation time on , 1999, the business day prior to the initial
date of deposit. The value of the Securities on any subsequent business day
will vary. Sponsors' loss on deposit was $ .
------------------------------------
The securities were acquired on , 1999 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 Portfolio during the last three years. Affiliates of the Sponsors may serve
as specialists in the securities in this Portfolio on one or more stock
exchanges and may have a long or short position in any of these securities or
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 Portfolio. 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.
------------------------------------
Please note that if this prospectus is used as a preliminary
prospectus
for a future portfolio in this Series, the Portfolio will
contain different
stocks from those described above.
<PAGE>
- --------------------------------------------------------------------------------
Accumulating Assets Portfolio
- --------------------------------------------------------------------------------
Baby Boom Economy Portfolios 1999 Series
Defined Asset Funds
<TABLE>
<CAPTION>
Price
Ticker Percentage Per Share Cost
Name of Issuer Symbol of Portfolio (1) to Portfolio to Portfolio (2)
- ------------------------------------------------------------------------------------------------------
<S> <C>
21. %% $
22.
23.
24.
25.
26.
27.
28.
29.
30.
31.
32.
33.
34.
35.
36.
37.
38.
39.
40.
</TABLE>
- ------------------------------------
(1) Based on Cost to Portfolio.
(2) Valuation by the Trustee made on the basis of closing sale prices at the
evaluation time on , 1999, the business day prior to the initial
date of deposit. The value of the Securities on any subsequent business day
will vary. Sponsors' loss on deposit was $ .
------------------------------------
The securities were acquired on , 1999 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 Portfolio during the last three years. Affiliates of the Sponsors may serve
as specialists in the securities in this Portfolio on one or more stock
exchanges and may have a long or short position in any of these securities or
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 Portfolio. 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.
------------------------------------
Please note that if this prospectus is used as a preliminary
prospectus
for a future portfolio in this Series, the Portfolio will
contain different
stocks from those described above.
<PAGE>
- --------------------------------------------------------------------------------
Accumulating Assets Portfolio
- --------------------------------------------------------------------------------
Baby Boom Economy Portfolios 1999 Series
Defined Asset Funds
<TABLE>
<CAPTION>
Price
Ticker Percentage Per Share Cost
Name of Issuer Symbol of Portfolio (1) to Portfolio to Portfolio (2)
- ------------------------------------------------------------------------------------------------------
<S> <C>
41. %% $
42.
43.
44.
45.
46.
47.
48.
49.
50.
51.
52.
53.
54.
55.
56.
57.
58.
59.
60.
-----------------
75.00%
-----------------
-----------------
</TABLE>
- ------------------------------------
(1) Based on Cost to Portfolio.
(2) Valuation by the Trustee made on the basis of closing sale prices at the
evaluation time on , 1999, the business day prior to the initial
date of deposit. The value of the Securities on any subsequent business day
will vary. Sponsors' loss on deposit was $ .
------------------------------------
The securities were acquired on , 1999 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 Portfolio during the last three years. Affiliates of the Sponsors may serve
as specialists in the securities in this Portfolio on one or more stock
exchanges and may have a long or short position in any of these securities or
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 Portfolio. 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.
------------------------------------
Please note that if this prospectus is used as a preliminary
prospectus
for a future portfolio in this Series, the Portfolio will
contain different
stocks from those described above.
<PAGE>
- --------------------------------------------------------------------------------
Accumulating Assets Portfolio
- --------------------------------------------------------------------------------
Baby Boom Economy Portfolios 1999 Series
Defined Asset Funds
<TABLE>
<CAPTION>
Face Cost
Portfolio Title Amount Coupon Maturity To Fund
- -----------------------------------------------------------------------------------------------------------------
<S> <C>
U.S. Government Treasury Securities (25%)
--------------------
--------------------
--------------------
</TABLE>
------------------------------------
Please note that if this prospectus is used as a preliminary
prospectus
for a future Portfolio in this Series, the Portfolio will
contain different
bonds from those described above.
<PAGE>
Accumulating Assets Portfolio Risk/Return Summary (Continued)
5. Is this Portfolio Appropriate for You?
o The Accumulating Assets Portfolio was designed to meet the
financial needs of investors who are generally in their
prime earning years. While they frequently can afford to
invest more of their money, they have less time in the
workforce to recover assets in the event of a loss in the
stock market.
o When it comes to investing, it's important to balance how
much risk you're willing to take with your investment
portfolio, with the reward that you want for the long-term.
One way to do this is to find the appropriate allocation of
stocks and bonds to provide the growth you want, with a risk
level that is comfortable for you. If accumulating assets is
your investment goal, you may want to take a more moderate
approach to stocks, and include bonds to help offset your
risk.
o 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 if you want a speculative investment that
changes to take advantage of market movements, or 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 Portfolio Operating Expenses
Amount
As a % of Per 1,000
Net Assets Units
---------- -----------
% $
Trustee's Fee
(including organization
costs)
% $
Portfolio Supervision,
Bookkeeping and
Administrative Fees
% $
Other Operating Expenses
---------- -----------
% $
Total
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
total deferred sales fee of $17.50 ($2.50 per 1,000 units
deducted in seven monthly payments beginning , 1999).
The maximum sales fees are as follows:
Your maximum
sales fee
If you invest: will be:
---------------------------------------- ----------------
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%
Example
This example may help you compare the cost of investing in
the Portfolio to the cost of investing in other portfolios.
The example assumes that you invest $10,000 in the Portfolio
for the periods indicated and sell all your units at the end
of those periods. The example also assumes a 5% return on
your investment each year and that the Portfolio's operating
expenses stay the same. Although your actual costs may be
higher or lower, based on these assumptions your costs would
be:
1 Year 3 Years 5 Years 10 Years
$ $ $ $
7. Is the Portfolio Managed?
Unlike a mutual fund, the Portfolio is not managed and
securities are not sold because of market changes. Rather,
the Sponsors monitor the Portfolio. The Portfolio may sell a
bond if certain adverse credit or other conditions exist.
The Sponsors may instruct the Trustee to sell stocks under
certain limited circumstances. However, given the investment
philosophy of the Portfolio, the Sponsor is not likely to do
so.
8. How do I Buy Units?
The minimum investment is $ .
You can buy units from any of the Sponsors and other
broker-dealers. The Sponsors are listed later in this
prospectus. Some banks may offer units for sale through
special arrangements with the Sponsors, although certain
legal restrictions may apply. Employees of certain Sponsors
and Sponsor affiliates and non-employee directors of certain
of the Sponsors may purchase units at a reduced sales fee.
7
<PAGE>
Accumulating Assets Portfolio--Risk/Return Summary (continued)
Unit Price per 1,000 Units $
(as of , 1999)
Unit price is based on the net asset value of the
Portfolio plus the up-front sales fee. An amount equal to
any principal cash, as well as net accrued but
undistributed interest on the unit, is added to the unit
price. Unit price also includes organization costs.
Domestic Portfolio securities are valued by the Trustee on
the basis of their closing prices at 4:00 p.m. Eastern
time, and foreign Portfolio stocks are valued at the U.S.
dollar exchange rate at 2:30 p.m. Eastern time, every
business day.
Unit price changes every day with changes in the prices of
the securities in the Portfolio.
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, less any remaining deferred
sales fee and the costs of liquidating securities to meet
the redemption.
10. How are Distributions Made and Taxed?
The Portfolio pays distributions of any dividend income,
net of expenses, on the 25th of and
, 1999, 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
income distributions in cash.
Exchange Privileges
You may exchange units of this Portfolio for units of
certain other Defined Asset Funds. You may also exchange
into this Portfolio from certain other funds. We charge a
reduced sales fee on exchanges.
8
<PAGE>
- --------------------------------------------------------------------------------
Adding Income Portfolio--Risk/Return Summary
1. What is the Portfolio's Objective?
The Portfolio seeks total return through capital
appreciation and current income by investing approximately
50% of its assets in a diversified portfolio of global
equity securities and approximately 50% of its assets in
fixed-income securities for approximately one year.
2. What is the Portfolio's Investment Strategy?
o The Portfolio plans to invest approximately 50% of its
assets in a number of stocks favored by demographic
trends--companies which should experience growth as the
'baby boomer' generation grows older. Our Portfolio
Consultants are Wall Street veterans William Sterling and
Stephen Waite, authors of the book 'Boomernomics,' and
authorities on the trends of baby boomers. Sterling and
Waite, together with their team of financial professionals,
selected the securities for this Portfolio. They believe
companies in the healthcare, technology, entertainment,
leisure and financial services industries will be best
positioned to benefit from these trends and accordingly,
have selected Portfolio securities in these industries.
o The baby boomers, the generation born between 1946 and 1964,
have remarkably consistent saving, spending, and life-style
patterns. Past baby boomer spending patterns appear to have
a direct correlation to the growth of certain industries
that meet the needs of baby boomers.
o The Sponsors believe that as the baby boomers mature and
adjust their lives for later years, spending patterns are
likely to have a positive effect on the industries
represented in the Portfolio.
o The Portfolio will invest approximately 50% of its assets in
fixed-income securities consisting of U.S. Government
Treasury Securities with various maturities.
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 industries:
Approximate
Portfolio
Percentage
o %
o %
o %
o %
o %
o %
o %
o U.S. Government Treasury Securities 50%
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. Market factors may cause the
prices of the stocks to change.
o The asset allocation percentages of the Portfolio are
calculated as of the date of deposit. Asset allocation
percentages may vary on any subsequent day due to
fluctuations in the market value of the Portfolio
securities.
o Rising interest rates can reduce the value of your units.
o Generally, fixed income securities with longer maturities
will change in value more than those with shorter
maturities.
o Because the Portfolio is concentrated in stocks, adverse
developments in this industry may affect the value of your
units.
o The Portfolio may continue to purchase or hold the stocks
originally selected even though their market value may have
changed or they may be subject to sell recommendations from
one or more of the Sponsors.
9
<PAGE>
- --------------------------------------------------------------------------------
Adding Income Portfolio
- --------------------------------------------------------------------------------
Baby Boom Economy Portfolios 1999 Series
Defined Asset Funds
<TABLE>
<CAPTION>
Price
Ticker Percentage Per Share Cost
Name of Issuer Symbol of Portfolio (1) to Portfolio to Portfolio (2)
- ------------------------------------------------------------------------------------------------------
Equity Securities (50%)
<S> <C>
1. %% $
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
</TABLE>
- ------------------------------------
(1) Based on Cost to Portfolio.
(2) Valuation by the Trustee made on the basis of closing sale prices at the
evaluation time on , 1999, the business day prior to the initial
date of deposit. The value of the Securities on any subsequent business day
will vary. Sponsors' loss on deposit was $ .
------------------------------------
The securities were acquired on , 1999 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 Portfolio during the last three years. Affiliates of the Sponsors may serve
as specialists in the securities in this Portfolio on one or more stock
exchanges and may have a long or short position in any of these securities or
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 Portfolio. 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.
------------------------------------
Please note that if this prospectus is used as a preliminary
prospectus
for a future portfolio in this Series, the Portfolio will
contain different
stocks from those described above.
<PAGE>
- --------------------------------------------------------------------------------
Adding Income Portfolio
- --------------------------------------------------------------------------------
Baby Boom Economy Portfolios 1999 Series
Defined Asset Funds
<TABLE>
<CAPTION>
Price
Ticker Percentage Per Share Cost
Name of Issuer Symbol of Portfolio (1) to Portfolio to Portfolio (2)
- ------------------------------------------------------------------------------------------------------
<S> <C>
21. %% $
22.
23.
24.
25.
26.
27.
28.
29.
30.
31.
32.
33.
34.
35.
36.
37.
38.
39.
40.
</TABLE>
- ------------------------------------
(1) Based on Cost to Portfolio.
(2) Valuation by the Trustee made on the basis of closing sale prices at the
evaluation time on , 1999, the business day prior to the initial
date of deposit. The value of the Securities on any subsequent business day
will vary. Sponsors' loss on deposit was $ .
------------------------------------
The securities were acquired on , 1999 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 Portfolio during the last three years. Affiliates of the Sponsors may serve
as specialists in the securities in this Portfolio on one or more stock
exchanges and may have a long or short position in any of these securities or
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 Portfolio. 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.
------------------------------------
Please note that if this prospectus is used as a preliminary
prospectus
for a future portfolio in this Series, the Portfolio will
contain different
stocks from those described above.
<PAGE>
- --------------------------------------------------------------------------------
Adding Income Portfolio
- --------------------------------------------------------------------------------
Baby Boom Economy Portfolios 1999 Series
Defined Asset Funds
<TABLE>
<CAPTION>
Price
Ticker Percentage Per Share Cost
Name of Issuer Symbol of Portfolio (1) to Portfolio to Portfolio (2)
- ------------------------------------------------------------------------------------------------------
<S> <C>
41. %% $
42.
43.
44.
45.
46.
47.
48.
49.
50.
51.
52.
53.
54.
55.
56.
57.
58.
59.
60.
-----------------
50.00%
-----------------
-----------------
</TABLE>
- ------------------------------------
(1) Based on Cost to Portfolio.
(2) Valuation by the Trustee made on the basis of closing sale prices at the
evaluation time on , 1999, the business day prior to the initial
date of deposit. The value of the Securities on any subsequent business day
will vary. Sponsors' loss on deposit was $ .
------------------------------------
The securities were acquired on , 1999 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 Portfolio during the last three years. Affiliates of the Sponsors may serve
as specialists in the securities in this Portfolio on one or more stock
exchanges and may have a long or short position in any of these securities or
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 Portfolio. 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.
------------------------------------
Please note that if this prospectus is used as a preliminary
prospectus
for a future portfolio in this Series, the Portfolio will
contain different
stocks from those described above.
<PAGE>
- --------------------------------------------------------------------------------
Adding Income Portfolio
- --------------------------------------------------------------------------------
Baby Boom Economy Portfolios 1999 Series
Defined Asset Funds
<TABLE>
<CAPTION>
Face Cost
Portfolio Title Amount Coupon Maturity To Fund
- -----------------------------------------------------------------------------------------------------------------------
<S> <C>
U.S. Government Treasury Securities (50%)
--------------------
--------------------
--------------------
</TABLE>
------------------------------------
Please note that if this prospectus is used as a preliminary
prospectus
for a future Portfolio in this Series, the Portfolio will
contain different
bonds from those described above.
<PAGE>
Distribution Portfolio Risk/Return Summary (Continued)
5. Is this Portfolio Appropriate for You?
o The Adding Income Portfolio was designed to meet the
financial needs of investors who are generally looking
toward retirement. While a conservative level of growth is
still important for these investors, they may want to also
reduce their risk and preserve their capital for the years
to come.
o When it comes to investing, it's important to balance how
much risk you're willing to take with your investment
portfolio, with the reward that you want for the long-term.
One way to do this is to find the appropriate allocation of
stocks and bonds to provide the growth you want, with a risk
level that is comfortable for you. If you need current
income, a healthy portion of bonds may be a good idea for
your investment portfolio. You may also want to include
stocks for a conservative level of growth.
o 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 if you want a speculative investment that
changes to take advantage of market movements, or 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 Portfolio Operating Expenses
Amount
As a % of Per 1,000
Net Assets Units
---------- -----------
% $
Trustee's Fee
(including organization
costs)
% $
Portfolio Supervision,
Bookkeeping and
Administrative Fees
% $
Other Operating Expenses
---------- -----------
% $
Total
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
total deferred sales fee of $17.50 ($2.50 per 1,000 units
deducted in seven monthly payments beginning , 1999).
The maximum sales fees are as follows:
Your maximum
sales fee
If you invest: will be:
---------------------------------------- ---------------
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%
Example
This example may help you compare the cost of investing in
the Portfolio to the cost of investing in other portfolios.
The example assumes that you invest $10,000 in the Portfolio
for the periods indicated and sell all your units at the end
of those periods. The example also assumes a 5% return on
your investment each year and that the Portfolio's operating
expenses stay the same. Although your actual costs may be
higher or lower, based on these assumptions your costs would
be:
1 Year 3 Years 5 Years 10 Years
$ $ $ $
7. Is the Portfolio Managed?
Unlike a mutual fund, the Portfolio is not managed and
securities are not sold because of market changes. Rather,
the Sponsors monitor the Portfolio. The Portfolio may sell
a bond if certain adverse credit or other conditions
exist. The Sponsors may instruct the Trustee to sell
stocks under certain limited circumstances. However, given
the investment philosophy of the Portfolio, the Sponsor is
not likely to do so.
8. How do I Buy Units?
The minimum investment is $ .
You can buy units from any of the Sponsors and other
broker-dealers. The Sponsors are listed later in this
prospectus. Some banks may offer units for sale through
special arrangements with the Sponsors, although certain
legal restrictions may apply. Employees of certain
Sponsors and Sponsor affiliates and non-employee directors
of certain of the Sponsors may purchase units at a reduced
sales fee.
10
<PAGE>
Adding Income Portfolio Risk/Return Summary (continued)
Unit Price per 1,000 Units $
(as of , 1999)
Unit price is based on the net asset value of the
Portfolio plus the up-front sales fee. An amount equal to
any principal cash, as well as net accrued but
undistributed interest on the unit, is added to the unit
price. Unit price also includes organization costs.
Domestic Portfolio securities are valued by the Trustee on
the basis of their closing prices at 4:00 p.m. Eastern
time, and foreign Portfolio securities are valued at the
U.S. dollar exchange rate at 2:30 p.m. Eastern time, every
business day.
Unit price changes every day with changes in the prices of
the securities in the Portfolio.
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, less any remaining deferred
sales fee and the costs of liquidating securities to meet
the redemption.
10. How are Distributions Made and Taxed?
The Portfolio pays distributions of any dividend income,
net of expenses, on the 25th of and
, 1999, 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
income distributions in cash.
Exchange Privileges
You may exchange units of this Portfolio for units of
certain other Defined Asset Funds. You may also exchange
into this Portfolio from certain other funds. We charge a
reduced sales fee on exchanges.
11
<PAGE>
What You Can Expect From Your Investment
Income
Each Portfolio will pay to you any income it has received two times during its
life.
Changes in interest rates generally will not affect your income because each
portfolio is fixed.
Along with your income, you will receive your share of any available bond
principal.
Records and Reports
You will receive:
o a notice from the Trustee if new securities are deposited in exchange or
substitution for securities originally deposited;
o a statement of income payments two times a year;
o a final report on Portfolio activity; and
o annual tax information. This will also be sent to the IRS. You must report the
amount of income and interest received during the year. Please contact your
tax advisor in this regard.
You may request copies of securities evaluations to enable you to comply with
federal and state tax reporting requirements and 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
Foreign Issuer Risk
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 restrictons on the payment of
dividends;
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.
Foreign Currency Risk
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.
At the present time the Sponsors do not believe that any of the Portfolio
Securities is subject to exchange control restrictions which would materially
interfere with payment to the Portfolio of amounts due on the Portfolio
Securities. 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. There can be no assurance that exchange control regulations might
not be adopted in the future that would adversely affect payments to the
Portfolio.
On January 1, 1999, the European Monetary Union (EMU) introduced a new single
currency, the euro. A newly created European Central Bank (ECB) has the
authority to direct the monetary policy for this region, including the
determination of interest rates. These
12
<PAGE>
changes may affect the European capital markets, and the related risks may
increase the volatility in European capital and currency markets. This, in turn,
may affect the Portfolio's performance.
Liquidity
Sales of foreign securities in United States securities markets are ordinarily
subject to severe restrictions and will generally be made only in foreign
securities markets. You should know that:
o 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;
o a foreign market's liquidity might become impaired as a result of economic
or political turmoil, or if relations between the United States and such
foreign country deteriorate markedly; and
o the principal trading market for the Portfolio 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 Portfolio
Securities.
Interest Rate Risk on the Treasury Securities
Investing involves risks, including the risk that your investment will decline
in value if interest rates rise. Generally, fixed income securities with longer
maturities will change in value more than those with shorter maturities. This
would result in early returns of principal to you and may result in early
termination of the Portfolio. Of course, we cannot predict how interest rates
may change.
Concentration Risk
When stocks in a particular industry make up 25% or more of a Portfolio, the
Portfolio 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 industry.
Litigation and Legislation Risks
We do not know of any pending litigation that might have a material adverse
effect upon the Portfolios.
Future tax legislation could affect the value of the a Portfolio by:
o reducing the dividends-received deduction or
o increasing the corporate tax rate resulting in less money available for
dividend payments.
Selling or Exchanging 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 fees, market movements and changes in a Portfolio.
If you sell your units before the final deferred sales fee payment, the amount
of any remaining payments will be deducted from your proceeds.
13
<PAGE>
Sponsors' Secondary Market
While we are not obligated to do so, we will buy back units at net asset value
less any remaining deferred sales fee and the cost of liquidating securities to
meet the redemption. We may resell the units to other buyers or 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.
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 may sell your units in the over-the-counter market for a
higher price, but is not obligated to do so. 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 $1,000,000, 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.
Rollover/Exchange Option
When a Portfolio is about to terminate, you may have the option to roll your
proceeds into the next Baby Boom Economy Portfolio Series if one is available.
If you hold your Units with one of the Sponsors and notify your financial
adviser by , your units will be redeemed and the proceeds from the sale of the
securities will be reinvested in units of a new Baby Boom Economy Portfolios
Series. If you
14
<PAGE>
decide not to roll over your proceeds, you will receive a cash distribution
after the Portfolios terminates.
If the participant in the rollover, you may realize taxable capital gain but may
not be entitled to a deduction for any capital loss recognized on the rollover.
You should consult your tax advisor in this regard.
If you continue to hold your Units, you may exchange units of a Portfolio in
this Series 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 Portfolio Works
Pricing
Units are charged a combination of initial and deferred sales fees.
In addition, a portion of the price of a unit also consists of cash to pay all
or some of the costs of organizing the Portfolio including:
o cost of initial preparation of legal documents;
o federal and state registration fees;
o initial fees and expenses of the Trustee;
o initial audit; and
o legal expenses and other out-of-pocket expenses.
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. The initial sales fee is
equal to the aggregate sales fee less the aggregate amount of any remaining
installments of the deferred sales fee.
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 and the independent evaluator value 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). Evaluations for foreign stocks are generally based
on the U.S. dollar equivalent of the last reported closing sales prices or, if
closing sales prices are not available, at the mean between the closing bid and
offer prices. If the securities are listed on a national securities exchange or
the Nasdaq 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. On holidays
when the U.S. Government is closed (Columbus Day and Veterans's Day), the
portion of the net asset value relating to the U.S. Government Treasury
Securities will be based on the previous days' closing price. Securities
15
<PAGE>
evaluations are generally determined on the basis of current bid or offer prices
for the Securities or comparable securities or by appraisal or by any
combination of these methods. Under current market conditions the bid prices for
Treasury obligations of the type deposited in the Portfolio are expected to be
approximately % less than the offer price.
Income
o Interest on any fixed income securities purchased on a when-issued basis or
for a delayed delivery does not begin to accrue until the securities are
delivered to the Portfolio. If a security is not delivered on time and the
Trustee's annual fee and expenses do not cover the additional accrued
interest, we will treat the contract to buy the security as failed.
o The Trustee credits any dividends received and any interest income to an
Income Account and other receipts to a Capital Account. The Trustee may
establish a reserve account by withdrawing from the these accounts amounts it
considers appropriate to pay any material liability. These accounts do not
bear interest.
o Each unit receives an equal share of distributions of interest and dividend
income, if any, 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.
Expenses
The Trustee is paid a fee monthly. This fee includes an amount for estimated
organization costs including:
o cost of initial preparation of legal documents;
o federal and state registration fees;
o initial fees and expenses of the Trustee;
o initial audit; and
o legal expenses and other out-of-pocket expenses.
The Trustee 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 45 cents per 1,000 units annually
for providing portfolio supervisory, bookkeeping and administrative services and
for any other expenses properly chargeable to the Portfolio. While this fee may
exceed the amount of these costs and expenses attributable to this Series, 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
Portfolios also pay the Evaluator's fees.
The Trustee's, Evaluator'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.
16
<PAGE>
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.
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
Each Portfolio is a 'unit investment trust' governed by a Trust Indenture, a
contract among the Sponsors, the Trustee and the Evaluator, if any, 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 Evaluator may
resign or be removed by the Sponsors and the Trustee without consent of
investors. The Trustee may resign or be removed by the Sponsors without the
consent of investors. The resignation or removal of either 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 resignation, the resigning Trustee or Evaluator 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;
17
<PAGE>
o liquidate the Portfolios; 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 the Evaluator 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
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 Chase Manhattan Bank, Unit Trust Department, 4 New York Plaza--6th Floor,
New York, New York 10004, 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. 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 which were acquired from underwriting syndicates of which it was a
member.
Public Distribution
During the initial offering period, units will be distributed to the public by
the Sponsors and dealers who are members of the National Association of
Securities Dealers, Inc.
Dealers will be entitled to the concession stated below on Units sold or
redeemed during the first year.
Dealer Concession
as
a % of Public
Amount Purchased Offering Price
-------------------------------- -------------------
Less than $50,000 %
$50,000 to $99,999 %
$100,000 to $249,999 %
$250,000 to $999,999 %
$1,000,000 and over %
18
<PAGE>
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 exptect 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.
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. You should consult your own tax
adviser about your particular circumstances.
Taxation of the Portfolio
Each Portfolio Fund 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 a Portfolio's interest income, dividend income and gains
from securities it has held for one year or less will generally be taxed to you
as ordinary income. Distributions to you in excess of a 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 exceed your basis, they will be treated
as gain from the sale of your units (as discussed below).
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 in this regard.
Distributions to you of a 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 a Portfolio terminates in less than one year, in which case all
distributions from a 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
advisor in this regard.
19
<PAGE>
Gain or Loss Upon Disposition
You will generally recognize gain or loss when you dispose of your units by sale
or redemption. If you choose to roll over your investment in the Fund into a new
fund, 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 advisor in this regard.
If you receive securities upon redemption of your units, 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 you 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 will generally be long-term if you have held your investment for
more than one year and short-term if you have held it for one year or less.
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 a 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.
Foreign Investors
If you are a foreign investor and you are not engaged in a U.S. trade of
business, you will generally be subject to 30% withholding tax (or a lower
applicable treaty rate) on distributions. Because interest income of the type
that may be received by a Portfolio generally would not have been subject to
withholding if you had received it directly, an investment in the Accumulation
or Distribution Portfolios may be appropriate for you only when you can use a
foreign tax credit or corresponding tax benefit in respect of such withholding
taxes on a Portfolio's interest income. You should consult your tax adviser to
determine whether investment in a Portfolio is appropriate for you.
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.
20
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
The Sponsors, Trustee and Holders of Equity Investor Fund, Baby Boom Economy
Portfolios 1999 Series, Defined Asset Funds (the 'Fund'):
We have audited the accompanying statements of condition and the related defined
portfolios included in the prospectus of the Fund as of , 1999.
These financial statements are the responsibility of the Trustee. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits 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. Our procedures included
confirmation of cash, securities and an irrevocable letter of credit deposited
for the purchase of securities, as described in the statements 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 audits provide 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 the Fund as of ,
1999 in conformity with generally accepted accounting principles.
DELOITTE & TOUCHE LLP
New York, N.Y.
, 1999
Statements of Condition as of , 1999
Trust Property
<TABLE>
<CAPTION>
Adding Accumulating Adding
Growth Assets Income
Portfolio Portfolio Portfolio
-------------------- -------------------- --------------------
<S> <C> <C> <C> <C> <C> <C>
Investments--Bonds and Contracts to purchase
Securities(1) $ $ $
Cash
Accrued interest to initial date of deposit on underlying
Bonds
-------------------- -------------------- --------------------
Total $ $ $
-------------------- -------------------- --------------------
-------------------- -------------------- --------------------
Liabilities and Interest of Holders
Liabilities:
Advance by Trustee for accrued interest(2) $ $ $
Subtotal
-------------------- -------------------- --------------------
Interest of Holders of units of fractional
undivided interest
outstanding
(Growth Portfolio-- ; Accumulation Portfolio--
Distribution
Portfolio-- )
Cost to investors(3)(4)(5)
Organization expenses(3) and gross underwriting
commissions(4) () () ()
-------------------- -------------------- --------------------
Subtotal
-------------------- -------------------- --------------------
Total $ $ $
-------------------- -------------------- --------------------
-------------------- -------------------- --------------------
</TABLE>
- ---------------
(1) Aggregate cost to the Portfolio of the securities listed under the
Portfolios determined by the Trustee at 4:00 p.m., Eastern time on ,
1999. The contracts to purchase securities are collateralized by an irrevocable
letter of credit which has been issued by Bank, New York Branch, in the
amount of $ and deposited with the Trustee. The amount of the letter
of credit includes $ for the purchase of securities.
(2) A portion of the Public Offering Price consists of securities in
an amount sufficient to pay all or a portion of the costs incurred in
establishing the Portfolio. These costs have been estimated at $ 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 organization
expenses obligation of the investors will be satisfied. If the actual
organization costs exceed the estimated aggregate amount shown above the
Sponsors will pay for this excess amount.
(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 Initial Date of Deposit will be
adjusted to maintain the $ per 1,000 Units offering price only for that
day. The Unit Price on any subsequent business day will vary.
(4) Aggregate Unit price computed on the basis of the value of the
underlying securities at 4:00 p.m., Eastern time on , 1999.
(5) Assumes the maximum initial sales charge per 1,000 units of 1.00%
of the Unit Price. A deferred sales charge of $2.50 per 1,000 Units is payable
on , 1999 and thereafter on the 1st day of each month through ,
2000. 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.
22
<PAGE>
Defined
Asset FundsSM
Have questions ? Equity Investor Fund
Request the most Baby Boom Economy Portfolios
recent free Information 1999 Series
Supplement that gives more (A Unit Investment Trust)
details about the Fund, ---------------------------------------
by calling: This Prospectus does not contain
The Chase Manhattan Bank complete information about the
1-800-323-1508 investment company filed with the
Securities and Exchange Commission in
Washington, D.C. under the:
o Securities Act of 1933 (file no.
333-72365) and
o Investment Company Act of 1940 (file
no. 811-1777).
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.
-- /99
