<PAGE>
RULE NO. 424(b)(3)
REGISTRATION NO. 33-65135
PROSPECTUS SUPPLEMENT
- ---------------------
(TO PROSPECTUS AND PROSPECTUS SUPPLEMENT, DATED APRIL 4, 1996 AND APRIL 10,
1996, RESPECTIVELY)
MERRILL LYNCH & CO., INC.
MEDIUM-TERM NOTES, SERIES B
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
FLIP-IN NOTES DUE MAY 12, 1997
Original Issue Date: April 15, 1996 Maturity Date: May 12, 1997
Principal Amount: $200 million
This Prospectus Supplement relates to $200,000,000 aggregate principal
amount of Notes which the Company has agreed to sell to Merrill Lynch, Pierce,
Fenner & Smith Incorporated (the "Underwriter"), and which the Underwriter has
agreed to purchase from the Company, at a price of 99.875% of the principal
amount thereof. The Underwriter has advised the Company that it proposes to
offer the Notes to the public at varying prices relating to prevailing market
prices at the time of resale.
DESCRIPTION OF THE NOTES
GENERAL
The Medium-Term Notes, Series B of Merrill Lynch & Co., Inc. (the
"Company") offered hereby are "Flip-in Notes due May 12, 1997" and are referred
to in this Prospectus Supplement as the "Notes". On July 12, 1996, October 15,
1996, January 13, 1997 or April 14, 1997 (each, an "Optional Conversion Date"),
the Company may exercise an option to convert in whole, but not in part, the
entire principal amount of the Notes from Fixed Rate Notes to Regular Floating
Rate Notes (the "Flip-in Option"), on notice given to the Holders of the Notes
as provided in the Indenture not more than 15 nor less than 5 calendar days
prior to such Optional Conversion Date. If an Optional Conversion Date would
fall on a day that is not a Business Day (as that term is defined for purposes
of Fixed Rate Notes), such Optional Conversion Date shall be postponed to the
following day that is a Business Day. Interest payments on the Notes will equal
the amount of interest accrued from and including the Original Issue Date, to,
but excluding, Maturity, if the Company does not exercise its Flip-in Option,
and otherwise interest payments will be calculated as described below, if the
Company does exercise its Flip-in Option. If the Company does not exercise its
Flip-in Option, interest on the Notes will be payable at Maturity.
PRIOR TO EXERCISE OF THE FLIP-IN OPTION
Prior to exercise by the Company of the Flip-in Option, the Notes will be
Fixed Rate Notes except as described below. Certain provisions of the Fixed
Rate Notes are more fully described in the accompanying Prospectus and
Prospectus Supplement. The Notes will bear interest at the rate of 6.00% per
annum until the earlier of (i) the principal amount thereof is paid or made
available for payment and (ii) the Flip-in Option is exercised. Interest on the
Notes will be computed on the basis of the actual number of days during the
period for which payment is being made, divided by 360. If the Company does not
exercise its Flip-in Option, interest on the Notes will be payable at Maturity.
Otherwise, the terms of the Notes will be as described in the accompanying
Prospectus and Prospectus Supplement.
The date of this Prospectus Supplement is April 12, 1996.
<PAGE>
SUBSEQUENT TO EXERCISE OF THE FLIP-IN OPTION
On and after the date on which the Flip-in Option is exercised, if any, the
Notes will be Regular Floating Rate Notes. Certain provisions of the Regular
Floating Rate Notes are more fully described in the accompanying Prospectus and
Prospectus Supplement. The Interest Rate Basis will be LIBOR; the Index
Currency will be U.S. Dollars; the Index Maturity will be 3 Months (except that
with respect to the April 14, 1997 Interest Reset Date, the Index Maturity will
be 1 Month); the Designated LIBOR Page will be Telerate Page 3750; the Spread
will be +0.05%. The Interest Reset Dates will be the Optional Conversion Date
on which the Flip-in Option is exercised (regardless of whether it is a London
Business Day or falls in the next succeeding calendar month) and each of October
15, 1996, January 13, 1997 and April 14, 1997 on and after the Flip-in Option is
exercised, commencing on the date on which the Flip-in Option is exercised. The
Interest Payment Dates will be the Optional Conversion Date on which the Flip-in
Option is exercised (regardless of whether it is a London business Day or falls
in the next succeeding calendar month) and each of October 15, 1996, January 13,
1997 and April 14, 1997, on and after the Flip-in Option is exercised commencing
on the date on which the Flip-in Option is exercised, and at Maturity. Interest
on the Notes will be computed on the basis of the actual number of days during
the period for which payment is being made, divided by 360. Interest on the
Notes will be computed and payable as a Regular Floating Rate Note as described
in the accompanying Prospectus and Prospectus Supplement.
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
The following discussion supplements the discussion contained in the
accompanying Prospectus Supplement under the heading "Certain United States
Federal Income Tax Considerations--U.S. Holders--Original Issue Discount". The
following discussion assumes that the "issue price" of the Notes, as determined
for United States Federal income tax purposes, will equal the Principal Amount.
The OID Regulations do not specifically address the proper United States
Federal income tax treatment of a debt instrument which provides the issuer with
an option to convert the interest rate from a fixed rate to a floating rate,
such as the Flip-in Option applicable to the Notes. It is also unclear whether
the tax treatment of the Notes is properly governed by the OID Regulations or
whether alternatively the Notes constitute contingent payment debt obligations.
Accordingly, the proper United States Federal income tax treatment of the Notes
is uncertain.
Due to the lack of authority directly addressing the proper United States
Federal income tax treatment of the Notes, since the OID Regulations contain an
analogous set of rules which apply to debt instruments which provide for
alternative payment schedules upon the occurrence of certain contingencies or
the exercise of certain options, although not expressly applicable to the Notes,
the Company intends to apply similar rules for purposes of calculating the
amount and accrual of original issue discount on the Notes. Based upon such an
approach, the Company intends to assume that the Company will not exercise the
Flip-in Option and that the Notes will accrue interest at the 6.00% per annum
fixed rate until the Maturity Date. Accordingly, under this approach, the Notes
will be treated as providing for stated interest throughout the entire term
thereof at a rate equal to the 6.00% per annum fixed rate. As a result of the
foregoing, under this approach, all interest on the Notes payable at the 6.00%
per annum fixed rate will constitute "qualified stated interest" and will be
taxed accordingly. Thus, under this approach, the Notes will not be treated as
having been issued with original issue discount for United States Federal income
tax purposes. Moreover, under this approach, if the Company in fact exercises
the Flip-in Option, solely for purposes of determining the accrual of original
issue discount and interest on the Notes, the Notes will be deemed to be
reissued for an issue price equal to the Principal Amount, and the floating
interest rate of the LIBOR Rate plus 0.05% will constitute qualified stated
interest and will be taxed accordingly. Where required, the Company intends to
file information returns with the IRS in accordance with the foregoing
treatment, in the absence of any change or clarification in the law, by
regulation or otherwise, requiring another treatment of the Notes for United
States Federal income tax purposes. There can be no assurance, however, that
the IRS will agree with the foregoing treatment, and it is possible that the IRS
could assert another treatment of the Notes.
Prospective investors in the Notes are urged to consult their own tax
advisors regarding the proper United States Federal income tax treatment of the
Notes.
S-2
