AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 23, 1994
REGISTRATION NO. 33-28452
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------------------
POST-EFFECTIVE AMENDMENT NO. 4
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:
DEFINED ASSET FUNDS--
GOVERNMENT SECURITIES INCOME FUND
U.S. TREASURY SERIES--7
LADDERED ZERO COUPONS
(A UNIT INVESTMENT TRUST)
B. NAMES OF DEPOSITORS:
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
SMITH BARNEY SHEARSON INC.
PAINEWEBBER INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
DEAN WITTER REYNOLDS INC.
C. COMPLETE ADDRESSES OF DEPOSITORS' PRINCIPAL EXECUTIVE OFFICES:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
UNIT INVESTMENT TRUST DIVISION
POST OFFICE BOX 9051
PRINCETON, N.J. 08543-9041 SMITH BARNEY SHEARSON INC.
TWO WORLD TRADE CENTER
101ST FLOOR
NEW YORK, N.Y. 10048
<TABLE>
<S> <C> <C>
PAINEWEBBER INCORPORATED PRUDENTIAL SECURITIES INCORPORATED DEAN WITTER REYNOLDS INC.
1285 AVENUE OF THE AMERICAS ONE SEAPORT PLAZA TWO WORLD TRADE CENTER--69TH FLOOR
NEW YORK, N.Y. 10019 199 WATER STREET NEW YORK, N.Y. 10048
NEW YORK, N.Y. 10292
</TABLE>
D. NAMES AND COMPLETE ADDRESSES OF AGENTS FOR SERVICE:
TERESA KONCICK, ESQ. THOMAS D. HARMAN, ESQ. LEE B. SPENCER, JR.
P.O. BOX 9051 388 GREENWICH STREET ONE SEAPORT PLAZA
PRINCETON, N.J. NEW YORK, N.Y. 10013 199 WATER STREET
08543-9051 NEW YORK, N.Y. 10292
COPIES TO:
PHILIP BECKER ROBERT E. HOLLEY PIERRE DE SAINT PHALLE,
130 LIBERTY STREET--29TH 1200 HARBOR BLVD. ESQ.
FLOOR WEEHAWKEN, N.J. 07087 450 LEXINGTON AVENUE
NEW YORK, N.Y. 10006 NEW YORK, N.Y. 10017
The issuer has registered an indefinite number of Units under the Securities Act
of 1933 pursuant to Rule 24f-2 and filed the Rule 24f-2 Notice for the most
recent fiscal year on February 17, 1994.
Check box if it is proposed that this filing will become effective on March 4,
1994 pursuant to paragraph (b) of Rule 485. / x /
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<PAGE>
DEFINED
ASSET FUNDSSM
GOVERNMENT SECURITIES
INCOME FUND
- ------------------------------------------------------------
U.S. TREASURY SERIES 7--
LADDERED ZERO COUPONS
(A UNIT INVESTMENT TRUST)
/ / U.S. GOVERNMENT-BACKED
/ / AAA RATED
/ / U.S. TAX EXEMPT FOR FOREIGN HOLDERS WHEN CERTAIN CONDITIONS
ARE MET
PROSPECTUS DATED MARCH 4, 1994
SPONSORS:
Merrill Lynch,
Pierce, Fenner & Smith Inc.
Smith Barney Shearson Inc.
PaineWebber Incorporated
Prudential Securities Incorporated
Dean Witter Reynolds Inc.
This Defined Fund was formed for the purpose of providing safety of capital and
a high yield to maturity through an investment in fixed portfolios consisting
primarily of stripped debt obligations of the United States ('Stripped Treasury
Securities'). The Series consists of three separate unit investment trusts
('Trusts'), each containing five Stripped Treasury Securities maturing in five
consecutive years. Approximately 20% of the face amount of the securities in
Assurance Trust 1995(A), 2000(B) and 2005(C) will mature each year beginning in
1995, 2000 and 2005, respectively.
Stripped Treasury Securities do not make any periodic payments of interest
before maturity; accordingly, each Trust is priced at a deep discount from face
amount. The objectives of this Series may not be met if Units are sold prior to
maturity of the underlying Securities, because market prices of the Securities
will vary with changes in interest rates and other factors and may vary more in
response to changing interest rates than comparable debt obligations that pay
interest currently. This risk is greater when the period to maturity is longer
(see Risk Factors).
Holders of Units will have significant amounts of income attributed to them
without receipt of corresponding cash. Accordingly, the Fund is particularly
suitable for purchases by tax advantaged accounts such as Individual Retirement
Accounts, self-employed retirement plans and pension funds and for investors who
have funds available to pay the federal taxes due in advance of the receipt of
cash attributable to the income (see Taxes). Interest income is exempt from
state and local personal income taxes in all states.
Minimum purchase in individual transactions: 3 Units.
- ------------------------------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- ------------------------------------------------------------------------
<PAGE>
DEFINED ASSET FUNDSSM is America's oldest and largest family of unit investment
trusts with over $90 billion sponsored since 1970. Each Defined Fund is a
portfolio of preselected securities. The portfolio is divided into 'units'
representing equal shares of the underlying assets. Each unit receives an equal
share of income and principal distributions.
With Defined Asset Funds you know in advance what you are investing in and that
changes in the portfolio are limited. Most defined bond funds pay interest
monthly and repay principal as bonds are called, redeemed, sold or as they
mature. Defined equity funds offer preselected stock portfolios with defined
termination dates.
Your financial advisor can help you select a Defined Fund to meet your personal
investment objectives. Our size and market presence enable us to offer a wide
variety of investments. Defined Funds are available in the following types of
securities: municipal bonds, corporate bonds, government bonds, utility stocks,
growth stocks, even international securities denominated in foreign currencies.
Termination dates are as short as one year or as long as 30 years. Special funds
are available for investors seeking extra features: insured funds, double and
triple tax-free funds, and funds with 'laddered maturities' to help protect
against rising interest rates. Defined Funds are offered by prospectus only.
- --------------------------------------------------------------------------------
CONTENTS
Investment Summary................................................... A-3
Fund Structure....................................................... 1
Risk Factors......................................................... 1
Description of the Fund.............................................. 2
Taxes................................................................ 4
Public Sale of Units................................................. 6
Market for Units..................................................... 8
Redemption........................................................... 9
Expenses and Charges................................................. 10
Administration of the Fund........................................... 11
Resignation, Removal and Limitations on Liability.................... 14
Miscellaneous........................................................ 15
Description of Ratings............................................... 17
Accountants' Opinion Relating to the Fund............................ D-1
Statement of Condition of the Fund................................... D-2
Portfolio............................................................ D-6
A-2
<PAGE>
DEFINED ASSET FUNDS--GOVERNMENT SECURITIES INCOME FUND,
U.S. TREASURY SERIES 7--LADDERED ZERO COUPONS
INVESTMENT SUMMARY AS OF NOVEMBER 30, 1993 (THE EVALUATION DATE)
<TABLE>
<CAPTION>
ASSURANCE TRUST ASSURANCE TRUST ASSURANCE TRUST
1995(A) 2000(B) 2005(C)
--------------- --------------- ------------------
<S> <C> <C> <C>
FACE AMOUNT OF DEBT OBLIGATIONS+....................... $ 29,000,000 $ 14,930,000 $ 7,950,000
PUBLIC OFFERING PRICE PER UNIT
(including applicable sales charge)++................ $ 858.56* $ 624.34* $ 437.31*
NUMBER OF UNITS........................................ 29,000 14,930 7,950
FRACTIONAL UNDIVIDED INTEREST IN TRUST REPRESENTED BY
EACH UNIT............................................ 1/29,000th 1/14,930th 1/7,950th
SPONSORS' REPURCHASE PRICE AND REDEMPTION PRICE PER
UNIT** (based on bid side evaluation)................ $ 836.22* $ 604.12* $ 418.20*
REDEMPTION PRICE PER UNIT LESS THAN:
Public Offering Price by.......................... $ 22.34 $ 20.12 $ 19.11
Sponsors' Initial Repurchase Price by............. $ 0.88 $ 1.49 $ 1.62
CALCULATION OF PUBLIC OFFERING PRICE
Aggregate offering side evaluation of Debt
Obligations in Trust............................ $ 24,275,776 $ 9,041,807 $ 3,337,557
--------------- --------------- ------------------
Divided by number of Units........................ $ 837.10 $ 605.61 $ 419.82
Plus applicable sales charge++.................... 21.46 18.73 17.49
--------------- --------------- ------------------
Public Offering Price per Unit.................... $ 858.56 $ 624.34 $ 437.31
--------------- --------------- ------------------
--------------- --------------- ------------------
CALCULATION OF ESTIMATED NET ANNUAL INTEREST RATE PER
UNIT (based on face amount of $1,000 per Unit)
Annual interest rate per Unit..................... .051% .066% .051%
Less estimated annual expenses per Unit expressed
as a percentage ($0.51, $0.66 and $0.51 per Unit
of Assurance Trust 1995(A), Assurance Trust
2000(B) and Assurance Trust 2005(C),
respectively)................................... .051% .066% .051%
--------------- --------------- ------------------
Estimated net annual interest rate per Unit....... 0.00% 0.00% 0.00%
--------------- --------------- ------------------
--------------- --------------- ------------------
DAILY RATE AT WHICH ESTIMATED NET INTEREST ACCRUES PER
UNIT................................................. 0.00% 0.00% 0.00%
TRUSTEE'S ESTIMATED ANNUAL FEE AND EXPENSES PER UNIT
(see Expenses and Charges)+++........................ $ 0.51 $ 0.66 $ 0.51
MINIMUM VALUE OF TRUSTS
Any Trust may be terminated with respect to that
Trust if the face amount of Securities in that
Trust is less than 40% of the face amount of
Securities on the dates of their deposit. As of
the Evaluation Date, each Trust was valued at
the following percentage of the face amount of
the Securities on the dates of their deposit.... 98% 94% 63%
</TABLE>
- ------------------
* Includes amortization of discount, calculated using the 'interest'
method, to expected date of settlement (normally 1 business day after purchase)
for Units as if purchased on the Investment Summary date.
** During the initial offering period, the Fund's Sponsors intend to offer
to purchase Units at prices based on the offer side value of the underlying
Securities. Thereafter, the Sponsors intend to maintain such a market based on
the bid side value of the underlying Securities which will be equal to the
Redemption Price. (See Market for Units.)
+ On the Initial Date of Deposit (October 11, 1989), the face amount of
each Trust was $500,000.
++ The sales charge applicable to purchases is as follows: Assurance
Trust 1995(A), 2.50% of Public Offering Price (2.564% of net amount invested in
Securities); Assurance Trust 2000(B), 3.0% of Public Offering Price (3.093% of
net amount invested in Securities) and Assurance Trust 2005(C), 4.0% of Public
Offering Price (4.167% of net amount invested in Securities). The sales charge
during the initial offering period and in the secondary market will be reduced
on a graduated scale in the case of purchases of $250,000 or more (see Public
Sale of Units--Public Offering Price). The resulting reduction in the Public
Offering Price will increase the effective long term return on a Unit.
+++ Of this amount, the Trustee receives annually for its service as
Trustee, $0.15 per $1,000 face amount of Debt Obligations. The Trustee's Annual
Fee and Expenses also include the Portfolio Supervision Fee and Evaluator's Fee
set forth herein.
A-3
<PAGE>
INVESTMENT SUMMARY FOR EACH TRUST AS OF NOVEMBER 30, 1993 (CONTINUED)
DISTRIBUTIONS
Distributions will be made two business days following
the maturity of each Security in a Trust to holders of
record five business days prior to the date of such
distribution.
EVALUATION TIME
3:30 P.M. New York Time
PORTFOLIO SUPERVISION FEE+
Maximum of $0.25 per $1,000 face amount of underlying
Debt Obligations (see Expenses and Charges)
EVALUATOR'S FEE FOR EACH EVALUATION
Minimum of $5.00 (see Expenses and Charges)
MANDATORY TERMINATION DATE
Each Trust must be terminated no later than one year
after the maturity date of the last maturing Debt
Obligation listed under its Portfolio (see Portfolios).
PORTFOLIO AT A GLANCE--
OBJECTIVES OF THE FUND--To obtain safety of capital and a high yield to
maturity through investment in fixed portfolios initially consisting primarily
of Stripped Treasury Securities which may be held through the Federal Reserve
Bank's book entry system called 'Separate Trading of Registered Interest and
Principal of Securities' ('STRIPS') (see Risk Factors for a brief description of
the characteristics of these Securities). The Fund is designed to accumulate
income for a fixed period and then distribute that income in approximately equal
amounts over a five-year period subsequent to the Initial Date of Deposit.
Income is accumulated at a predictable yield to maturity, because income is not
distributed on a current basis but is in effect reinvested and compounded. For
each Unit of a Trust purchased, a Holder will receive total distributions of
approximately $1,000 for Units held until maturity of all the underlying
Securities of that Trust. There is no assurance that these objectives will be
met if Units are sold prior to maturity of the underlying Securities as market
prices of the Securities before maturity will vary with changes in interest
rates.
The Securities were issued after July 18, 1984, are direct obligations of
the United States and are backed by its full faith and credit. The Fund was
formed for the purpose of providing protection against changes in interest
rates.
FUND PORTFOLIOS--The Portfolio of each Trust consists of five separate
Stripped Treasury Securities maturing in August of each year for five
consecutive years. Approximately 20% of the Securities in Assurance Trust
1995(A), 2000(B) and 2005(C) will mature each year for five years beginning in
1995, 2000 and 2005, respectively. Each of the Stripped Treasury Securities was
purchased at a deep discount and does not make any periodic payments of income
prior to maturity. In addition, each Trust also contains an interest-bearing
Treasury Security (the 'Treasury Note') deposited in order to provide income
with which to pay the expenses of the Trust. Treasury Securities are not rated,
but in the opinion of the Sponsors, based on the creditworthiness of the Federal
government, they have credit characteristics comparable to those of Securities
rated AAA by nationally recognized rating agencies. Units of the Fund are rated
AAA by Standard & Poor's. (See Risk Factors for a brief summary of certain
investment risks pertaining to these obligations.) The Sponsors may deposit
additional Securities in connection with the creation of additional Units, with
maturities identical to those of the Securities initially deposited, in any or
all of the Trusts following the Initial Date of Deposit (see Fund Structure:
Description of the Fund--The Portfolios).
RISK FACTORS--An investment in Units should be made with an understanding
of the risks which an investment in debt obligations, most of which were
purchased at a deep discount, may entail, including the risk that the value of a
Trust and hence of the Units will decline with increases in interest rates. The
market value of Stripped Treasury Securities, and therefore the value of the
Units, may be subject to greater fluctuations in response to changing interest
rates than debt obligations of comparable maturities which pay interest
currently. This risk is greater when the period to maturity is longer. (See Risk
Factors.) No distributions of income are anticipated until maturity of the
Securities. The price per Unit will vary in accordance with fluctuations in the
values of the Securities, and the distributions could change if Securities are
paid or sold, or if the expenses of the Trust change.
- ---------------
+ The Sponsors also may be reimbursed for their costs of bookkeeping and
administrative services to the Fund. Portfolio Supervision Fees deducted in
excess of Portfolio supervision expenses may be used for this reimbursement.
Additional deductions for this purpose are currently estimated not to exceed
an annual rate of $0.10 per Unit.
A-4
<PAGE>
INVESTMENT SUMMARY FOR EACH TRUST AS OF NOVEMBER 30, 1993 (CONTINUED)
For California investors: Residents of California are required to have
either (1) an annual income of at least $30,000 and a net worth of at least
$30,000 or (2) a net worth of $75,000. Net worth would generally be computed
exclusive of home, home furnishings and personal automobiles.
PUBLIC OFFERING PRICE--The minimum purchase in individual transactions is 3
Units. During the initial offering period and any offering of additional Units,
the Public Offering Price per Unit is equal to the aggregate offering side
evaluation of the underlying Securities (the price at which they could be
purchased directly by the public assuming they were available) divided by the
number of Units outstanding, plus the applicable sales charge per Unit (which
ranges from 2.50%* to 4%* of the Public Offering Price (2.564%* to 4.167%* of
the net amount invested)). The secondary market Public Offering Price is based
on the bid side evaluation of the underlying Securities, plus the applicable
sales charge per Unit. The Public Offering Price on the date of this prospectus
or on any subsequent dates, will vary from the Public Offering Price set forth
on pA-2 (see Public Sale of Units--Public Offering Price and Redemption).
DISTRIBUTIONS--There will be no payments of interest on the Securities;
consequently, there should be no distributions of interest income. Nevertheless,
the Trust's gross income is taxable to Holders, as explained below under
Taxation. Distributions will be made in cash 2 business days following the
maturity of each Security in a Trust (see Administration of the Fund--Accounts
and Distributions).
TAXATION--Each Holder will be considered the owner of a pro rata portion of
each Security in his Trust. A Holder is required to treat his pro rata portion
of each Stripped Treasury Security in his Trust as a bond that was originally
issued on the date the Holder purchases his Units at an original issue discount
equal to the excess of the stated maturity value over the Holder's tax cost, and
to include annually in income a portion of that original issue discount
determined under a formula which takes into account the compounding of interest.
Because this original issue discount will be included in the Holder's ordinary
gross income before the Holder receives cash attributable to this income, the
Fund is suitable only for investors who can pay taxes on the income with other
funds or for purchase by Individual Retirement Accounts ('IRAs'), Keogh plans,
and other tax-deferred retirement plans (see Retirement Plans). Of course, since
investors pay tax on income as it accrues, all distributions will be free of
tax. Accrued interest income and capital gains are exempt from U.S. Federal
income taxes, including withholding taxes, for Foreign Holders who meet certain
conditions and provide required certification. The Sponsors also believe that
accrued interest will be exempt from state and local personal income taxes in
all states. (See Taxes.)
MARKET FOR UNITS--The Sponsors, though not obligated to do so, intend to
maintain a secondary market for Units based on the aggregate bid side evaluation
of the underlying Securities (see Market for Units). If this market is not
maintained a Holder will be able to dispose of his Units through redemption at
prices also based on the aggregate bid side evaluation of the underlying
Securities (see Redemption). Market conditions may cause the prices available in
the market maintained by the Sponsors or available upon exercise of redemption
rights to be more or less than the total of the amount paid for Units. The
market price of Stripped Treasury Securities, and hence of the Units, are
subject to greater fluctuations than the prices of securities making current
payments of interest.
- ---------------
* This sales charge will be reduced on a graduated scale in the case of quantity
purchases (see Public Sale of Units--Public Offering Price).
A-5
<PAGE>
DEFINED ASSET FUNDS - GOVERNMENT SECURITIES INCOME FUND,
U.S. TREASURY SERIES 7 - LADDERED ZERO COUPONS
REPORT OF INDEPENDENT ACCOUNTANTS
The Sponsors, Co-Trustees and Holders
of Defined Asset Funds - Government Securities Income Fund,
U.S. Treasury Series 7 - Laddered Zero Coupons:
We have audited the accompanying statements of condition of the
Assurance Trust 1995 (A), the Assurance Trust 2000 (B) and the
Assurance Trust 2005 (C) of Defined Asset Funds - Government Securities
Income Fund, U.S. Treasury Series 7 - Laddered Zero Coupons, including
the portfolios, as of November 30, 1993 and the related statements of
operations and of changes in net assets for the years ended
November 30, 1991, 1992 and 1993. These financial statements are the
responsibility of the Co-Trustees. 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 audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. Securities owned at November 30, 1993, as shown
in such portfolios, were confirmed to us by Investors Bank & Trust
Company, a Co-Trustee. An audit also includes assessing the
accounting principles used and significant estimates made by the
Co-Trustees, 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
above-mentioned Trusts of Defined Asset Funds - Government Securities
Income Fund, U.S. Treasury Series 7 - Laddered Zero Coupons at
November 30, 1993 and the results of their operations and changes in
their net assets for the above-stated years in conformity with
generally accepted accounting principles.
DELOITTE & TOUCHE
New York, N.Y.
January 26, 1994
D - 1
<PAGE>
DEFINED ASSET FUNDS - GOVERNMENT SECURITIES INCOME FUND,
U.S. TREASURY SERIES 7 - LADDERED ZERO COUPONS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
ASSURANCE TRUST
1995(A)
_______________________________________
Years Ended November 30,
1991 1992 1993
____ ____ ____
<S> <C> <C> <C>
OPERATIONS:
Net investment income....................... $ 604,303 $ 996,366 $1,301,660
Realized gain on securities sold............ 26,048
Unrealized appreciation of investments...... 637,071 298,339 657,430
_______________________________________
Net increase in net assets resulting from
operations................................ 1,241,374 1,320,753 1,959,090
_______________________________________
CAPITAL SHARE TRANSACTIONS (Note 3):
Issuance of additional units................ 5,416,318 2,470,390 6,913,892
Redemption of units......................... (517,427)
________________________________________
Net capital share transactions.............. 5,416,318 1,952,963 6,913,892
________________________________________
NET INCREASE IN NET ASSETS.................... 6,657,692 3,273,716 8,872,982
NET ASSETS AT BEGINNING OF YEAR............... 5,442,246 12,099,938 15,373,654
________________________________________
NET ASSETS AT END OF YEAR..................... $12,099,938 $15,373,654 $24,246,636
_______________________________________
PER UNIT:
Net asset value at end of year.............. $681.69 $749.93 $836.09
___________________________________
TRUST UNITS OUTSTANDING AT END OF YEAR........ 17,750 20,500 29,000
___________________________________
</TABLE>
See Notes to Financial Statements.
D - 5
DEFINED ASSET FUNDS - GOVERNMENT SECURITIES INCOME FUND,
U.S. TREASURY SERIES 7 - LADDERED ZERO COUPONS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
ASSURANCE TRUST
2000(B)
________________________________________
Years Ended November 30,
1991 1992 1993
____ ____ ____
<S> <C> <C> <C>
OPERATIONS:
Net investment income........................ $ 159,903 $ 398,970 $ 564,363
Realized gain on securities sold............. 817 86,231
Unrealized appreciation of investments....... 208,729 222,538 885,637
_______________________________________
Net increase in net assets resulting from
operations................................. 368,632 622,325 1,536,231
_______________________________________
CAPITAL SHARE TRANSACTIONS (Note 3) -
Issuance of additional units................. 2,674,237 2,354,355 1,099,456
Redemption of units.......................... (32,233) (459,760)
_______________________________________
Net capital share transactions............... 2,674,237 2,322,122 639,696
_______________________________________
NET INCREASE IN NET ASSETS..................... 3,042,869 2,944,447 2,175,927
NET ASSETS AT BEGINNING OF YEAR................ 856,100 3,898,969 6,843,416
_______________________________________
NET ASSETS AT END OF YEAR...................... $ 3,898,969 $6,843,416 $9,019,343
________________________________________
PER UNIT:
Net asset value at end of year............... $445.60 $500.25 $604.11
___________________________________
TRUST UNITS OUTSTANDING AT END OF YEAR......... 8,750 13,680 14,930
_________________________________
</TABLE>
See Notes to Financial Statements.
D - 6
DEFINED ASSET FUNDS - GOVERNMENT SECURITIES INCOME FUND,
U.S. TREASURY SERIES 7 - LADDERED ZERO COUPONS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
ASSURANCE TRUST
2005(C)
_______________________________________
Years Ended November 30,
1991 1992 1993
____ ____ ____
<S> <C> <C> <C>
OPERATIONS:
Net investment income........................ $ 138,492 $ 143,510 $ 218,238
Realized gain (loss) on securities sold...... (16,881) 39,213 160,038
Unrealized appreciation of investments....... 131,955 26,565 444,163
_______________________________________
Net increase in net assets resulting from
operations................................. 253,566 209,288 822,439
________________________________________
CAPITAL SHARE TRANSACTIONS (Note 3):
Issuance of additional units................. 271,562 1,036,662 605,026
Redemption of units.......................... (205,846) (591,028) (692,608)
_______________________________________
Net capital share transactions............... 65,716 445,634 (87,582)
_______________________________________
NET INCREASE IN NET ASSETS..................... 319,282 654,922 734,857
NET ASSETS AT BEGINNING OF YEAR................ 1,615,236 1,934,518 2,589,440
_______________________________________
NET ASSETS AT END OF YEAR...................... $ 1,934,518 $ 2,589,440 $3,324,297
_______________________________________
PER UNIT:
Net asset value at end of year............... $288.73 $325.71 $418.15
___________________________________
TRUST UNITS OUTSTANDING AT END OF YEAR......... 6,700 7,950 7,950
________________________________
</TABLE>
See Notes to Financial Statements.
D - 7
DEFINED ASSET FUNDS - GOVERNMENT SECURITIES INCOME FUND,
U.S. TREASURY SERIES 7 - LADDERED ZERO COUPONS
STATEMENTS OF CONDITION
AS OF NOVEMBER 30, 1993
<TABLE>
<CAPTION>
ASSURANCE ASSURANCE
TRUST TRUST
1995(A) 2000(B)
_______ _______
<S> <C> <C>
TRUST PROPERTY:
Investment in marketable securities - at value
(see Portfolios and Note 1)........................... $24,250,425 $9,019,556
Accrued interest receivable............................. 4,329 440
Cash.................................................... 1,612 3,821
___________ __________
Total trust property............................ 24,256,366 9,023,817
LESS LIABILITY - Accrued expenses......................... 9,730 4,474
___________ __________
NET ASSETS (Note 2)....................................... $24,246,636 $9,019,343
___________ __________
UNITS OUTSTANDING......................................... 29,000 14,930
______ ______
UNIT VALUE ............................................... $836.09 $604.11
_______ _______
</TABLE>
ASSURANCE
TRUST
2005(C)
_______
TRUST PROPERTY:
Investment in marketable securities - at value
(see Portfolios and Note 1)........................... $ 3,324,658
Accrued interest receivable............................. 1,230
Cash.................................................... 1,499
___________
Total trust property............................ 3,327,387
LESS LIABILITY - Accrued expenses......................... 3,090
___________
NET ASSETS (Note 2)....................................... $ 3,324,297
___________
UNITS OUTSTANDING......................................... 7,950
_____
UNIT VALUE ............................................... $418.15
_______
See Notes to Financial Statements.
D - 2
<PAGE>
DEFINED ASSET FUNDS - GOVERNMENT SECURITIES INCOME FUND,
U.S. TREASURY SERIES 7 - LADDERED ZERO COUPONS
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
ASSURANCE TRUST
1995(A)
____________________________________
Years Ended November 30,
1991 1992 1993
____ ____ ____
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income................................. $ 6,618 $ 10,016 $ 12,599
Accretion of original issue discount............ 602,561 995,703 1,309,430
Co-Trustee's fees and expenses.................. (4,306) (7,288) (8,591)
Sponsors' fees.................................. (570) (2,065) (11,778)
____________________________________
Net investment income........................... 604,303 996,366 1,301,660
____________________________________
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Realized gain on securities sold or redeemed.... 26,048
Unrealized appreciation of investments.......... 637,071 298,339 657,430
____________________________________
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS... 637,071 324,387 657,430
____________________________________
NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS...................................... $1,241,374 $1,320,753 $1,959,090
____________________________________
ASSURANCE TRUST
2000(B)
____________________________________
Years Ended November 30,
1991 1992 1993
____ ____ ____
INVESTMENT INCOME:
Interest income................................. $ 3,215 $ 7,454 $ 9,861
Accretion of original issue discount............ 158,689 397,516 567,708
Co-Trustee's fees and expenses.................. (1,751) (4,609) (7,572)
Sponsors' fees.................................. (250) (1,391) (5,634)
____________________________________
Net investment income........................... 159,903 398,970 564,363
____________________________________
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Realized gain on securities sold or redeemed.... 817 86,231
Unrealized appreciation of investments.......... 208,729 222,538 885,637
____________________________________
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS... 208,729 223,355 971,868
____________________________________
NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS...................................... $ 368,632 $ 622,325 $1,536,231
____________________________________
</TABLE>
See Notes to Financial Statements.
D - 3
<PAGE>
DEFINED ASSET FUNDS - GOVERNMENT SECURITIES INCOME FUND,
U.S. TREASURY SERIES 7 - LADDERED ZERO COUPONS
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
ASSURANCE TRUST
2005(C)
_______________________________________
Years Ended November 30,
1991 1992 1993
____ ____ ____
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income............................... $ 3,597 $ 3,362 $ 4,495
Accretion of original issue discount.......... 137,416 143,465 220,895
Co-Trustee's fees and expenses................ (1,969) (1,844) (3,013)
Sponsors' fees................................ (552) (1,473) (4,139)
______________________________________
Net investment income......................... 138,492 143,510 218,238
______________________________________
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Realized gain (loss) on securities sold...... (16,881) 39,213 160,038
Unrealized appreciation of investments....... 131,955 26,565 444,163
______________________________________
Net realized and unrealized gain on
investments................................ 115,074 65,778 604,201
______________________________________
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS.............................. $ 253,566 $209,288 $822,439
______________________________________
</TABLE>
See Notes to Financial Statements.
D - 4
<PAGE>
DEFINED ASSET FUNDS - GOVERNMENT SECURITIES INCOME FUND,
U.S. TREASURY SERIES 7 - LADDERED ZERO COUPONS
NOTES TO FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES
The Fund is registered under the Investment Company Act of 1940 as a Unit
Investment Trust. The following is a summary of significant accounting
policies consistently followed by the Fund in the preparation of its financial
statements. The policies are in conformity with generally accepted accounting
principles.
(a) Securities are stated at value as determined by the Evaluator based on bid
side evaluations for the securities.
(b) Cost of securities purchased is based on offering side evaluations at dates
of purchases and has been adjusted to include the accretion of original
issue discount on the Stripped Treasury Securities.
(c) Each Trust is not subject to income taxes. Accordingly, no provision for
such taxes is required.
2. NET ASSETS, NOVEMBER 30, 1993
ASSURANCE TRUST 1995(A)
_______________________
<TABLE>
<S> <C>
Cost of 29,000 units at Dates of Deposit........................... $19,888,251
Less: Sales charges............................................... 497,206
___________
Net amount applicable to Holders................................... 19,391,045
Net cost of units redeemed less redemption amounts................. 67,316
Realized gain on securities sold................................... 26,048
Unrealized appreciation of investments............................. 1,683,975
___________
Net capital applicable to Holders.................................. 21,168,384
Undistributed net investment income (including $3,082,040 of
accretion of original issue discount)............................ 3,078,252
___________
Net assets......................................................... $24,246,636
___________
ASSURANCE TRUST 2000(B)
_______________________
Cost of 14,930 units at Dates of Deposit............................ $6,785,622
Less: Sales charges............................................... 203,569
__________
Net amount applicable to Holders................................... 6,582,053
Net cost of units redeemed less redemption amounts................. (26,471)
Realized gain on securities sold................................... 87,048
Unrealized appreciation of investments............................. 1,309,563
__________
Net capital applicable to Holders.................................. 7,952,193
Undistributed net investment income (including $1,067,364 of
accretion of original issue discount)............................ 1,067,150
__________
Net assets......................................................... $9,019,343
__________
</TABLE>
D - 8
<PAGE>
DEFINED ASSET FUNDS - GOVERNMENT SECURITIES INCOME FUND,
U.S. TREASURY SERIES 7 - LADDERED ZERO COUPONS
NOTES TO FINANCIAL STATEMENTS
ASSURANCE TRUST 2005(C)
_______________________
<TABLE>
<S> <C>
Cost of 7,950 units at Dates of Deposit............................ $2,275,297
Less: Sales charges............................................... 91,012
__________
Net amount applicable to Holders................................... 2,184,285
Net cost of units redeemed less redemption amounts................. (2,890)
Realized gain on securities sold................................... 182,370
Unrealized appreciation of investments............................. 613,410
__________
Net capital applicable to Holders.................................. 2,977,175
Undistributed net investment income (including $347,483 of
accretion of original issue discount)............................ 347,122
__________
Net assets......................................................... $3,324,297
__________
</TABLE>
3. CAPITAL SHARE TRANSACTIONS
Additional units were issued as follows:
<TABLE>
<CAPTION>
Years Ended November 30,
Trust 1991 1992 1993
_____ ____ ____ ____
<S> <C> <C> <C>
Assurance Trust 1995(A) 8,500 3,500 8,500
Assurance Trust 2000(B) 6,500 5,000 2,000
Assurance Trust 2005(C) 1,000 3,250 1,750
Units were redeemed as follows:
Years Ended November 30,
Trust 1991 1992 1993
_____ ____ ____ ____
Assurance Trust 1995(A) 750
Assurance Trust 2000(B) 70 750
Assurance Trust 2005(C) 800 2,000 1,750
</TABLE>
Units may be redeemed at the office of Investors Bank & Trust Company, a
Co-Trustee, upon tender thereof generally on any business day or, in the case of
uncertified units, upon delivery of a request for redemption and payment of any
relevant tax. The Co-Trustee will redeem units either in cash or in kind at the
option of the Holder as specified in writing to the Co-Trustee. See
"Redemption" in this Prospectus, Part B.
4. INCOME TAXES
All Trust items of income received, accretion of original issue discount,
expenses paid, and realized gains and losses on securities sold are attributable
to the Holders, on a pro rata basis, for Federal income tax purposes in
accordance with the grantor trust rules of the United States Internal Revenue
Code.
At November 30, 1993, the cost of investment securities for Federal income tax
purposes was approximately equivalent to the adjusted cost as shown in each
Trust's portfolio.
D - 9
<PAGE>
DEFINED ASSET FUNDS - GOVERNMENT SECURITIES INCOME FUND,
U.S. TREASURY SERIES 7 - LADDERED ZERO COUPONS
NOTES TO FINANCIAL STATEMENTS
5. DISTRIBUTIONS
It is anticipated that each Trust will make distributions two business days
following the maturity of each security in that Trust to holders of record five
business days prior to the date of such distribution.
D - 10
<PAGE>
DEFINED ASSET FUNDS - GOVERNMENT SECURITIES INCOME FUND,
U.S. TREASURY SERIES 7 - LADDERED ZERO COUPONS
PORTFOLIOS
AS OF NOVEMBER 30, 1993
Portfolio No. and Title Interest Face Adjusted
of Securities Rates Maturities Amount Cost(1)
_____________ _____ __________ ______ _______
ASSURANCE TRUST 1995(A)
_______________________
1 Stripped Treasury
Securities (2).......... 0.000% 8/15/95 $ 5,800,000 $ 5,198,338
2 Stripped Treasury
Securities (2).......... 0.000% 8/15/96 5,800,000 4,832,781
3 Stripped Treasury
Securities (2).......... 0.000% 8/15/97 5,800,000 4,483,047
4 Stripped Treasury
Securities (2).......... 0.000% 8/15/98 5,800,000 4,149,411
5 Stripped Treasury
Securities (2).......... 0.000% 8/15/99 5,615,000 3,711,088
6 U.S. Treasury Notes....... 8.000% 8/15/99 185,000 191,785
___________ ___________
Total..................... $29,000,000 $22,566,450
___________ ___________
ASSURANCE TRUST 2000(B)
_______________________
1 Stripped Treasury
Securities (2).......... 0.000% 8/15/00 $ 2,986,000 $ 1,796,083
2 Stripped Treasury
Securities (2).......... 0.000% 8/15/01 2,986,000 1,652,431
3 Stripped Treasury
Securities (2).......... 0.000% 8/15/02 2,986,000 1,515,647
4 Stripped Treasury
Securities (2).......... 0.000% 8/15/03 2,986,000 1,391,817
5 Stripped Treasury
Securities (2).......... 0.000% 8/15/04 2,900,000 1,241,401
6 U.S. Treasury Notes....... 11.625% 11/15/04 86,000 112,614
___________ ___________
Total..................... $14,930,000 $ 7,709,993
___________ ___________
ASSURANCE TRUST 2005(C)
_______________________
1 Stripped Treasury
Securities (2).......... 0.000% 8/15/05 $ 1,590,000 $ 626,576
2 Stripped Treasury
Securities (2).......... 0.000% 8/15/06 1,590,000 579,296
3 Stripped Treasury
Securities (2).......... 0.000% 8/15/07 1,590,000 531,180
4 Stripped Treasury
Securities (2).......... 0.000% 8/15/08 1,590,000 487,707
5 Stripped Treasury
Securities (2).......... 0.000% 8/15/09 1,545,000 435,103
6 U.S. Treasury Notes....... 9.375% 2/15/06 45,000 51,386
___________ ___________
Total..................... $ 7,950,000 $ 2,711,248
___________ ___________
(1) See Notes to Financial Statements.
(2) See "Risk Factors - Special Characteristics of Stripped Treasury
Securities" in this Prospectus, Part B.
D - 11
<PAGE>
Value(1)
________
$ 5,413,662
5,113,338
4,838,534
4,546,736
4,128,990
209,165
___________
$24,250,425
___________
$ 2,052,278
1,903,276
1,787,658
1,658,604
1,492,717
125,023
___________
$ 9,019,556
___________
$ 761,387
703,623
653,792
604,932
542,959
57,965
___________
$ 3,324,658
___________
<PAGE>
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTOR'S GUIDE DEFINED GOVERNMENT SECURITIES INCOME FUNDS
GOVERNMENT SECURITIES Our defined portfolios of U.S. Treasury bonds offer investors a simple and
INCOME FUND convenient way to participate in the U.S. Treasury market while earning an
- --------------------------------------------- attractive return. And by purchasing government bond funds, investors avoid
U.S. TREASURY SERIES 7-- the problem of selecting securities by themselves.
LADDERED ZERO COUPONS THE SAFETY OF U.S. TREASURY BONDS
The U.S. Government is obligated to the holders of these securities, such
as the Fund, to pay every penny of interest and principal due to them. The
Fund itself is not backed by the Government, only the bonds it holds. The
value of the units will fluctuate with changes in market conditions.
U.S. TREASURY, LADDERED ZERO COUPONS TRUST
(THE ASSURANCE TRUST)
The Trust assures you of cash when you decide it's needed. Whether it's the
education of children or your own retirement, having a predictable annual
cash flow can lessen the financial drain that often accompanies important
milestones in life. Using the Trust to plan for your goals can help
'assure' your financial security.
LADDERED ZERO COUPONS
Each Assurance Trust is a portfolio of zero coupon U.S. Treasury securities
which mature at approximately one year intervals beginning in 1995, 2000
and 2005, respectively. Zero coupon securities do not make periodic
payments of interest but are bought at substantial discount from their
stated face value and accrete interest over their lifetime. While the
theoretical value of these securities is the discounted price, plus
accreted interest, the price actually fluctuates with interest rates. When
held to maturity, however, they will return 100% of face value.
Each unit of the Assurance Trust, represents a pro-rata share of a
portfolio of zero coupon bonds and an interest bearing security to pay
expenses of the Trust. At maturity, each security will pass through to the
Trust about $200 per unit. At the end of its payout period then, each unit
is expected to have returned $1,000 in principal. Your actual return may
vary with changes in the expenses of the Trust, additional purchases or
sales of underlying securities and redemptions of units.
INVESTMENT FLEXIBILITY
There are three different portfolios of the Assurance Trust. The accretion
periods vary from trust to trust, but the payment period is always 5 years.
You can purchase units of any of the trusts individually or combine
purchases to guarantee a longer stream of payments. For example, if you
invest in all three trusts, you'll receive your first payment of
approximately $200 per Unit in 1995 and payments of $200 per Unit each year
thereafter for the next 15 years. For your convenience, the payment date is
the same each year.
AAA-RATED INVESTMENT QUALITY
Based on the creditworthiness of the U.S. treasury bonds in the portfolio,
Standard & Poor's has rated units of the Fund AAA, its highest rating.
(Continued on next page)
</TABLE>
THIS PAGE MAY NOT BE DISTRIBUTED UNLESS INCLUDED IN A CURRENT PROSPECTUS.
INVESTORS SHOULD REFER TO THE PROSPECTUS FOR FURTHER INFORMATION.
<PAGE>
A LIQUID INVESTMENT
Although not legally required to do so, the Sponsors have maintained a
secondary market for Defined Asset Funds for over 20 years. You can cash in
your units at any time. Your price is based on the market value of the
Fund's securities at that time as determined by an independent evaluator
which may be more or less than you paid.
STATE AND LOCAL TAX EXEMPT
Income from the Fund is exempt from state and local personal income taxes
in all states just as though you owned the Treasury bonds directly.
Depending on where you live, these exemptions could significantly increase
the after-tax return you receive. For foreign Holders, income is exempt
from U.S. Federal income taxes, including withholding taxes.
VOLUME DISCOUNTS
For larger purchases the sales charge has been reduced, depending on the
total amount you invest. This increases your effective long-term return on
a Unit.
To give you an idea of these volume purchase discounts please examine the
chart below. This example is based on the public offering price as of the
date of this prospectus.
Sales Charge as
a percentage of the
Dollar Amount Invested Public Offering Price
Assurance Assurance Assurance
Trust Trust Trust
1995(A) 2000(B) 2005(C)
Less than $250,000 2.50% 3.00% 4.00%
$250,000 to 499,999 2.00% 2.50% 3.00%
$500,000 to 749,999 1.50% 2.00% 2.50%
$750,000 to 999,999 1.25% 1.50% 2.00%
$1,000,000 or more 1.00% 1.25% 1.50%
<PAGE>
DEFINED ASSET FUNDS--
GOVERNMENT SECURITIES INCOME FUND
U.S. TREASURY SERIES 7--
LADDERED ZERO COUPONS
FUND STRUCTURE
This Series (the 'Fund') of Defined Asset Funds--Government Securities
Income Fund consists of separate 'unit investment trusts' created under New York
law by a Trust Indenture (the 'Indenture') among the Sponsors, the Trustee and
the Evaluator. Unless otherwise indicated, when Investors Bank & Trust Company
and The First National Bank of Chicago act as Co-Trustees to the Fund,
references in the Prospectus shall be deemed to refer to the Co-Trustees. To the
extent that references in the Prospectus are to articles and sections of the
Indenture, which are hereby incorporated by reference, the statements made
herein are qualified in their entirety by this reference. The holders
('Holders') of Units will have the right to have their Units redeemed (see
Redemption) at a price based on the aggregate bid side evaluation of the
Securities ('Redemption Price per Unit') if they cannot be sold in the
over-the-counter market which the Sponsors propose to maintain (see Market for
Units).
As used herein, the term 'Securities' includes the Stripped Treasury
Securities and interest-bearing Treasury Notes initially deposited in the
Trusts, and includes all contracts to purchase the Securities accompanied by an
irrevocable letter or letters of credit sufficient to perform the contracts
initially deposited in the Trusts and any replacement and additional Securities
deposited in the Trusts following the Initial Date of Deposit. (See Description
of the Fund--The Portfolios.)
With the deposit of the Securities in the Trusts on the Initial Date of
Deposit, the Sponsors established a proportionate relationship among the face
amounts of each Security in a Portfolio. The Sponsors may deposit additional
Securities ('Additional Securities'), contracts to purchase Additional
Securities or cash (or a bank letter of credit in lieu of cash) with
instructions to purchase Additional Securities, in order to create new Units,
maintaining to the extent practicable the original proportionate relationship
among the face amounts of each Security in the particular Portfolio. It may not
be possible to maintain the exact original proportionate relationship among the
Securities deposited on the Initial Date of Deposit because of, among other
reasons, purchase requirements, changes in prices, or unavailability of
Securities. Replacement Securities may be acquired under specified conditions
(see Description of the Fund--The Portfolios; Administration of the
Fund--Portfolio Supervision). Units may be continuously offered to the public by
means of this Prospectus (see Public Sale of Units--Public Distribution)
resulting in a potential increase in the number of Units outstanding. Deposits
of Additional Securities in any Portfolio must replicate exactly the
proportionate relationship among the face amounts of Securities comprising that
Portfolio at the end of the initial 90-day period following the Initial Date of
Deposit.
1
<PAGE>
RISK FACTORS
An investment in Units of any Trust should be made with an understanding of
the risks which an investment in deep discount debt obligations may entail,
including the risk that the value of any Trust and hence of the Units will
decline with increases in interest rates. High inflation and recession, together
with the fiscal and monetary measures adopted to attempt to deal with those and
other economic problems, could result in wide fluctuations in interest rates and
thus in the value of fixed-rate debt obligations generally. The Sponsors cannot
predict future economic policies or their consequences or, therefore, the course
or extent of any similar fluctuations in the future. Furthermore, a Holder will
have significant amounts of taxable income before receipt of the cash
attributable to that income.
Because interest on 'zero coupon' debt obligations is not distributed on a
current basis but in effect compounded, the value of securities of this type,
including the value of accreted and reinvested interest (and of a fund comprised
of these obligations), is subject to greater fluctuations than of obligations
which distribute income regularly. Accordingly, while the full faith and credit
of the U.S. government provides a high level of protection against credit risks
on the Securities, sale of Units before maturity of the Securities at a time
when interest rates have increased would involve greater market risk than in a
fund which is invested in debt obligations of comparable maturity which pay
interest currently. This risk is greater when the period to maturity is longer.
SPECIAL CHARACTERISTICS OF STRIPPED TREASURY SECURITIES
Stripped Treasury Securities are sold at a deep discount because the buyer
of those securities obtains only the right to receive a future fixed payment on
the security and not any rights to periodic interest payments thereon.
Purchasers of these Securities acquire, in effect, discount obligations that are
economically identical to the 'zero-coupon bonds' that have been issued by
corporations. Zero coupon bonds are debt obligations which do not make any
periodic payments of interest prior to maturity and accordingly are issued at a
deep discount.
Stripped Treasury Securities held by any Trust shall consist solely of
either of the following types of registered securities: (a) U.S. Treasury debt
obligations originally issued as bearer coupon bonds which have been stripped of
their unmatured interest coupons and (b) coupons which have been stripped from
U.S. Treasury bearer bonds, either of which may be held through the Federal
Reserve Bank's book entry system called 'Separate Trading of Registered Interest
and Principal of Securities' ('STRIPS'). The Stripped Treasury Securities are
payable in full at maturity at their stated maturity amount and are not subject
to redemption prior to maturity. In addition, the Stripped Treasury Securities
do not make any periodic payments of interest.
The Stripped Treasury Securities in each Trust are sold at a substantial
discount from their face amounts payable at maturity. The holder of Stripped
Treasury Securities will be required to include annually in gross income an
allocable portion of the deemed original issue discount, prior to receipt of the
cash attributable to that income. Accordingly, the Fund may not be a suitable
investment unless these taxes can be paid from other funds or unless the Fund is
purchased by Individual Retirement Accounts, Keogh plans or other tax-deferred
retirement
2
<PAGE>
plans. (See Taxes.) Stripped Treasury Securities are marketable in substantially
the same manner as other discount Treasury securities.
Under generally accepted accounting principles, a holder of a security
purchased at a discount normally must report as an item of income for financial
accounting purposes the portion of the discount attributable to the applicable
reporting period. The calculation of this attributable income would be made on
the 'interest' method which generally will result in a lesser amount of
includible income in earlier periods and a correspondingly larger amount in
later periods. For Federal income tax purposes, the inclusion will be on a basis
that reflects the effective semi-annual compounding of accrued but unpaid
interest effectively represented by the discount. Although this treatment is
similar to the 'interest' method described above, the 'interest' method may
differ to the extent that generally accepted accounting principles permit or
require the inclusion of interest on the basis of a compounding period other
than the semi-annual period (see Income and Estimated Long Term Return and
Taxes).
U.S. TREASURY SECURITIES
The U.S. Treasury obligations included in the Portfolios are backed by the
full faith and credit of the United States. In order for the Securities to be
eligible for inclusion in the Fund, they must have been issued after July 18,
1984. Information concerning the coupon rates and maturities of the Securities
in the Fund is contained under Portfolios.
DESCRIPTION OF THE FUND
THE PORTFOLIOS
The Portfolio of each Trust consists of different issues of Stripped
Treasury Securities, with fixed maturity dates and not having any equity or
conversion features, that do not pay interest before maturity and as such were
purchased at a deep discount, and of the Treasury Note deposited in order to
provide income with which to pay the expenses of the Trust.
In selecting Securities for deposit in the Trusts, the following factors,
among others, were considered by Defined Asset Funds research analysts: (i) the
securities available and whether they were issued after July 18, 1984; (ii) the
prices of the securities relative to other comparable securities and the extent
to which certain of these securities are trading at a discount from par once the
interest coupons are stripped; (iii) the yield to maturity of the securities;
and (iv) the maturities of the securities.
The yield to maturity and the discount from par on securities of the type
deposited in the Trusts are dependent on a variety of factors, including general
money market conditions, general conditions of the bond market, prevailing
interest rates and the maturities of the securities.
Each Trust consists of the Securities (or contracts to purchase the
Securities) listed under Portfolios (including any Replacement Securities
('Replacement Securities') and Additional Securities deposited in any
3
<PAGE>
Trust in connection with the sale of additional Units to the public as described
below) as long as they may continue to be held from time to time in that Trust,
together with the accrued and undistributed interest on any interest-bearing
securities deposited in order to pay the expenses of the Trust and undistributed
cash realized from the sale or redemption of Securities (see Administration of
the Fund--Portfolio Supervision). Neither the Sponsors nor the Trustee shall be
liable in any way for any default, failure or defect in any of the Securities.
However, should any contract deposited in connection with the sale of additional
Units of a Trust fail ('Failed Debt Obligation'), the Sponsors are authorized
under the Indenture to direct the Trustee to acquire Replacement Securities to
make up the original Portfolio of that Trust. The Replacement Securities must
meet the criteria set forth in Administration of the Fund--Portfolio Supervision
below. If Replacement Securities are not acquired, the Sponsors will, within 30
days after the failure, cause to be refunded the attributable sales charge, plus
the attributable cost of Securities to the Trust, plus accrued interest if any
on the Treasury Note (at the coupon rate of the relevant Treasury Note to the
date the Sponsors are notified of the failure). (See Administration of the
Fund-- Portfolio Supervision.)
The Indenture authorizes the Sponsors to increase the size and the number
of Units of any Trust by the deposit of Additional Securities and the issue of a
corresponding number of additional Units subsequent to the Initial Date of
Deposit; and Securities may be sold under certain circumstances (see Redemption;
Administration of the Fund--Portfolio Supervision). Because the proceeds from
the sale of Securities received by any Trust (less certain amounts deducted by
the Trustee as described under Expenses and Charges) will be distributed to
Holders or paid out upon redemptions, and because additional Securities may be
deposited following the Initial Date of Deposit, the aggregate face amount of
the Securities in the Portfolio of each Trust will vary over time.
On the Evaluation Date each Unit represented the fractional undivided
interest in the relevant Trust set forth under Investment Summary. Thereafter,
if any Units of a Trust are redeemed by the Trustee the face amount of
Securities in that Trust will be reduced by amounts allocable to redeemed Units,
and the fractional undivided interest represented by each Unit in the balance
will be increased. However, if additional Units are issued by any Trust, the
aggregate value of Securities in that Trust will be increased by amounts
allocable to additional Units, and the fractional undivided interest represented
by each Unit in the balance will be decreased. Units will remain outstanding
until redeemed upon tender to the Trustee by any Holder (which may include the
Sponsors) or until the termination of the Indenture (see Redemption;
Administration of the Fund--Amendment and Termination).
RATING OF UNITS
Standard & Poor's Corporation ('Standard & Poor's') has rated the Units of
each Trust AAA. This is the highest rating assigned by Standard & Poor's (see
Description of Standard & Poor's Rating). Standard & Poor's has been compensated
by the Underwriting Account for its services in rating Units of each Trust.
INCOME AND ESTIMATED LONG TERM RETURN
The estimated long term return for each Trust represents an average of the
yields to maturity of the Securities in that Trust, calculated in accordance
with accepted bond practice and adjusted to reflect expenses and sales
4
<PAGE>
charges. Under accepted bond practice, bonds are customarily offered to
investors on a 'yield price' basis, which involves computation of yield to
maturity and which takes into account not only the interest payable on the bonds
but also the amortization or accretion to a specified date of any premium over
or discount from the par (maturity) value in the bond's purchase price. In
calculating Estimated Long Term Return, the average yield for a Trust is derived
by weighting each Security's yield by the market value of the Security and by
the amount of time remaining to the date to which the Security is priced. Once
the average Trust yield is computed, this figure is then adjusted for estimated
expenses and the effect of the applicable sales charge paid by investors. It is
assumed that interest income on the Treasury Notes will equal expenses.
The economic effect of purchasing Units of a Trust is that the investor who
holds his Units until maturity of the last of the underlying Securities of that
Trust should receive approximately a fixed yield, not only on his original
investment but on all earned discount during the life of the Securities. The
assumed or implicit automatic reinvestment at market rates at the time of
purchase of the portion of the yield represented by earned discount
differentiates the Trusts from funds comprised of customary securities on which
current periodic interest is paid at market rates at the time of issue.
Accordingly, an investor in the Units, unlike an investor in a fund comprised of
customary securities, virtually eliminates his risk of being unable to invest
distributions at a rate as high as the yield on his Trust, but will forgo the
ability to reinvest at higher rates in the future.
5
<PAGE>
The Treasury Note deposited in each Trust in order to pay the expenses of
that Trust includes an item of accrued but unpaid interest up to each date of
deposit. To avoid having Holders pay this accrued interest (which earns no
return) when Units are purchased, the Trustee pays this amount of accrued
interest to the Sponsors as a special distribution. The Trustee will recover the
amount of this distribution from interest received on the Treasury Note
deposited in that Trust. Although the Treasury Note will also accrue interest
during the period between the date of deposit and the date of settlement for
Units, the Sponsors anticipate that any such amount of accrued interest will be
minimal and, therefore, will not be added to the Public Offering Price of the
Units.
The price per Unit will vary in accordance with fluctuations in the prices
of the Securities held by a Trust. Changes in the Public Offering Prices or in a
Trust's expenses will result in changes in the estimated long term return.
TAXES
The following discussion addresses only the tax consequences of Units held
as capital assets and does not address the tax consequences of Units held by
dealers, financial institutions, or insurance companies.
In the opinion of Davis Polk & Wardwell, special counsel for the Sponsors,
under existing law:
Each Trust is not an association taxable as a corporation for Federal
income tax purposes, and income received by a Trust will be treated as the
income of the Holders of that Trust in the manner set forth below.
Each Holder will be considered the owner of a pro rata portion of each
Security in his Trust under the grantor trust rules of Section 671-679 of
the Internal Revenue Code of 1986, as amended (the 'Code'). The total cost
to a Holder for his Units, including sales charges, is allocated to his pro
rata portion of each Security in his Trust (in proportion to the fair
market values thereof on the date the Holder purchases his Units) in order
to determine his tax basis for his pro rata portion of each Security.
Each Holder will be considered to have received the income on his pro
rata portion of the Treasury Note in his Trust when interest on the Note is
received by his Trust. An individual Holder who itemizes deductions will be
able to deduct his pro rata share of the fees and expenses of his Trust
only to the extent that this amount together with the Holders' other
miscellaneous deductions exceed 2% of his adjusted gross income.
Each Trust contains primarily Treasury Securities which were originally
issued at a discount ('original issue discount'). The following principles
will apply to each Holder's pro rata portion of any security originally
issued at a discount. In general, original issue discount is defined as the
difference between the price at which a security was issued and its stated
redemption price at maturity. Original issue discount on a security issued
on or after July 2, 1982 will accrue as interest over the life of the
security under a formula based on the compounding of interest. If a
Holder's tax basis for his pro rata portion of a Security issued with
original issue discount is greater than its 'adjusted issue price' but less
than its stated redemption price at maturity (as may be adjusted for
certain payments), the Holder will be considered to have purchased his pro
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<PAGE>
rata portion of the Security at an 'acquisition premium.' The amount of
original issue discount which must be accrued will be reduced by the amount
of such acquisition premium. Each Holder will be required to include in
income the amount of original issue discount which accrues on his pro rata
portion of any Security originally issued at a discount. The amount of
accrued original issue discount so included in income in respect of a
Holder's pro rata portion of a Security is added to the Holder's tax basis
therefor.
If a Holder's tax basis for his pro rata portion of a Security exceeds
the redemption price at maturity thereof (subject to certain adjustments),
the Holder will be considered to have purchased his pro rata portion of the
Security at a 'premium'. The Holder may elect to amortize the premium prior
to the maturity of the Security. The amount amortized in any year should be
applied to offset the Holder's interest from the Security and will result
in a reduction of basis for his pro rata portion of the Security.
A Holder will recognize taxable gain (or loss) when all or part of his
pro rata portion of a Security in his Trust is disposed of by the Trust for
an amount greater (or less) than his adjusted tax basis. Any such taxable
gain or loss will be capital gain or loss except that any gain from the
disposition of a Holder's pro rata portion of a Security acquired by the
Holder at a 'market discount' (i.e., if the Holder's original cost for his
pro rata portion of the Security (plus any original issue discount which
will accrue thereon) is less than its stated redemption price at maturity)
will be treated as ordinary income to the extent the gain does not exceed
the accrued market discount. Capital gains are generally taxed at the same
rate as ordinary income, however, the excess of net long-term capital gains
over net short-term capital losses may be taxed at a lower rate than
ordinary income for certain noncorporate taxpayers. A capital gain or loss
is long-term if the asset is held for more than one year and short-term if
held for one year or less. The deduction of capital losses is subject to
limitations. A Holder will also be considered to have disposed of all or
part of his pro rata portion of each Security when he sells or redeems all
or some of his Units.
A distribution to a Holder of Securities upon redemption of Units will
not be a taxable event to the Holder or to nonredeeming Holders. The
redeeming Holder's basis for such Securities will be equal to his basis for
the Securities (previously represented by his Units) prior to such
redemption, and his holding period for such Securities will include the
period during which he held his Units. However, a Holder may recognize
taxable gain or loss when the Holder sells the Securities so distributed
for cash.
Under the income tax laws of the State and City of New York, each Trust
is not an association taxable as a corporation and income received by the
Trust will be treated as the income of the Holders of the Trust in the same
manner as for Federal income tax purposes.
Notwithstanding the foregoing, a Holder who is a non-resident alien
individual or a foreign corporation (a 'Foreign Holder') will generally not
be subject to U.S. Federal income taxes, including withholding taxes, on
the interest income (including any original issue discount) on, or any gain
from the sale or other disposition of, his pro rata portion of any Debt
Obligation provided that (i) the interest income or gain is not effectively
connected with the conduct by the Foreign Holder of a trade or business
within the United States, (ii) if the interest is United States source
income (which is the case on most Debt Obligations issued by
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United States issuers), the Foreign Holder does not own, actually or
constructively, 10% or more of the total combined voting power of all
classes of voting stock of the issuer of the Debt Obligation and is not a
controlled foreign corporation related (within the meaning of Section
864(d)(4) of the Code) to the issuer of the Debt Obligation, (iii) with
respect to any gain, the Foreign Holder (if an individual) is not present
in the United States for 183 days or more during the taxable year and (iv)
the Foreign Holder provides the required certification of his status and of
certain other matters. Withholding agents will file with the Internal
Revenue Service foreign person information returns with respect to such
interest payments accompanied by such certifications. Foreign Holders
should consult their own tax advisers with respect to United States Federal
income tax consequences of ownerhip of Units.
The foregoing discussion relates only to United States Federal and
certain aspects of New York State and City income taxes. Holders may be
subject to taxation in New York or in other jurisdictions (including a
Foreign Holders' country of residence) and should consult their own tax
advisers in this regard.
* * *
Holders will be required for Federal income tax purposes to include amounts
in ordinary gross income in advance of the receipt of the cash attributable to
such income. Therefore, purchase of Units may be appropriate only for an account
which can pay taxes with other funds in advance of the receipt of the cash
attributable to such income or for Individual Retirement Accounts, Keogh plans
or other tax-deferred retirement plans.
After the end of each calendar year, the Trustee will furnish to each
Holder a report from which the Holder may determine the income received by his
Trust on his pro rata portion of the Treasury Note and the Holder's pro rata
portion of the fees and expenses paid by his Trust. In order to enable them to
comply with Federal and state tax reporting requirements, Holders will be
furnished upon request to the Trustee with evaluations of Securities furnished
to it by the Evaluator. The Trustee will also furnish to each Holder and the
Internal Revenue Service all required information returns (including a return
with respect to original issue discount).
The Sponsors believe that Holders who are individuals will not be subject
to any state or local personal income taxes on the interest received by the Fund
and distributed to them. However, Holders (including individuals) may be subject
to state and local taxes on any capital gains (or market discount treated as
ordinary income) derived from a Trust and to other state and local taxes
(including corporate income or franchise taxes, personal property or intangibles
taxes, and estate or inheritance taxes) on their Units or the income derived
therefrom. In addition, individual Holders (and any other Holders which are not
subject to state and local taxes on the interest income derived from a Trust)
will probably not be entitled to a deduction for state and local tax purposes
for their share of the fees and expenses paid by the Trust, for any amortized
bond premium or for any interest on indebtedness incurred to purchase or carry
their Units. Therefore, even though the Sponsors believe that interest income
from each Trust is exempt from state and local personal income taxes in
virtually all states, Holders should consult their own tax advisers with respect
to state and local taxation.
8
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RETIREMENT PLANS
This Series of Defined Asset Funds--Government Securities Income Fund may
be well suited for purchase by IRAs, Keogh plans, pension funds and other
qualified retirement plans, certain of which are briefly described below.
Studies prepared by Merrill Lynch, Pierce, Fenner & Smith Incorporated show that
many Americans are expected to have insufficient funds to continue their current
lifestyle after they stop working. Generally, capital gains and income received
in each of the foregoing plans are exempt from Federal taxation. All
distributions from these plans are generally treated as ordinary income but may,
in some cases, be eligible for special 5 or 10 year averaging or tax-deferred
rollover treatment. Holders of units in IRAs, Keogh plans and other tax-deferred
retirement plans should consult their plan custodian as to the appropriate
disposition of distributions. Investors considering participation in any of
these plans should review specific tax laws related thereto and should consult
their attorneys or tax advisers with respect to the establishment and
maintenance of any of these plans. These plans are offered by brokerage firms,
including each of the Sponsors of the Trusts, and other financial institutions.
Fees and charges with respect to these plans may vary.
Retirement Plans for the Self-Employed--Keogh Plans. Units of each Trust
may be purchased by retirement plans established pursuant to the Self-Employed
Individuals Tax Retirement Act of 1962 ('Keogh plans') for self-employed
individuals, partnerships or unincorporated companies. Qualified individuals may
generally make annual tax-deductible contributions up to the lesser of 20% of
annual compensation or $30,000 in a Keogh plan. The assets of the plan must be
held in a qualified trust or other arrangement which meets the requirements of
the Code. Generally there are penalties for premature distributions from a plan
to certain participants before attainment of age 59 1/2, except in the case of
the participant's death or disability. Keogh plan participants may also
establish separate IRAs (see below) to which they may contribute up to an
additional $2,000 per year ($2,250 in a spousal account).
Individual Retirement Account--IRA. Any individual (including one covered
by an employer retirement plan) can establish an IRA or make use of a qualified
IRA arrangement set up by an employer or union for the purchase of Units of the
Fund. Any individual can make a contribution to an IRA equal to the lesser of
$2,000 ($2,250 in a spousal account or 100% of earned income; such investment
must be made in cash. However, the deductible amount an individual may
contribute will be reduced if the individual's adjusted gross income exceeds
$25,000 (in the case of a single individual) or $40,000 (in the case of married
individuals filing a joint return) or $200 (in the case of a married individual
filing a separate return). A married individual filing a separate return will
not be entitled to any deduction if the individual is covered by an
employer-maintained retirement plan without regard to whether the individual's
spouse is an active participant in an employee retirement plan. Unless
nondeductible contributions were made in 1987 or a later year, all distributions
from an IRA will be treated as ordinary income but generally will be eligible
for tax-deferred rollover treatment. It should be noted that certain
transactions which are prohibited under Section 408 of the Code will cause all
or a portion of the amount in an IRA to be deemed to be distributed and subject
to tax at that time. A participant's entire interest in an IRA must be, or
commence to be, distributed to the participant not later than the April 1
following the taxable year during which the participant attains age 70 1/2.
Taxable distributions made before attainment of age 59 1/2, except in the
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case of the participant's death or disability or where the amount distributed is
part of a series of substantially equal periodic (at least annual) payments that
are to be made over the life expectancies of the participant and his or her
beneficiary, are generally subject to a surtax in an amount equal to 10% of the
distribution.
PUBLIC SALE OF UNITS
PUBLIC OFFERING PRICE
The Public Offering Price of the Units of a Trust during the initial
offering period and any offering of additional Units is computed by dividing the
offering side evaluation of the Securities (as determined by the Evaluator) by
the number of Units outstanding and adding thereto the sales charge at the
applicable percentage of the offering side evaluation per Unit (the net amount
invested). For 'secondary market' sales the Public Offering Price of the Units
will be equal to the Evaluator's determination of the aggregate bid side
evaluation of the Securities in the Fund, adding thereto the applicable sales
charge and dividing the sum by the number of the Units outstanding. A
proportionate share of any cash not allocated to the purchase of specific
Securities and net accrued and undistributed interest on the Treasury Notes to
the date of delivery of the Units to the purchaser is added to the Public
Offering Price. The Public Offering Prices of the Units will vary from day to
day in accordance with fluctuations in the evaluations of the underlying
Securities.
The following tables set forth for both the initial offering period and for
secondary market sales the applicable percentage of sales charge, the concession
to dealers and the concession to introducing dealers (i.e., dealers that buy and
clear directly through a Sponsor or an Underwriter who is an affiliate of a
Sponsor). These amounts are reduced on a graduated scale for sales to any
purchaser of at least $250,000 and will be applied on whichever basis is more
favorable to the purchaser. To qualify for the reduced sales charge and
concession applicable to quantity purchases, the dealer must confirm that the
sale is to a single purchaser as defined below or is purchased for its own
account and not for distribution. Purchasers of Units of two or more Trusts will
pay the sales charge on Units of each Trust at the rate applicable to the total
dollar amount invested in this Series. Sales charges and dealer concessions are
as follows:
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<TABLE><CAPTION>
SALES CHARGE
(GROSS UNDERWRITING PROFIT)
----------------------------------
AS PERCENT OF AS PERCENT OF DEALER CONCESSION AS
DOLLAR AMOUNT INVESTED PUBLIC OFFERING NET AMOUNT PERCENT OF PUBLIC
(IN THOUSANDS) PRICE INVESTED OFFERING PRICE
------------------------- ------------------- ------------- ---------------------
<S> <C> <C> <C> <C>
Assurance Trust 1995(A) Less than $250........... 2.50% 2.564% 1.625%
$250--499................ 2.00 2.041 1.300
$500--749................ 1.50 1.523 0.975
$750--999................ 1.25 1.266 0.813
$1,000 or more........... 1.00 1.010 0.650
Assurance Trust 2000(B) Less than $250........... 3.00 3.093 1.950
$250--499................ 2.50 2.564 1.625
$500--749................ 2.00 2.041 1.300
$750--999................ 1.50 1.523 0.975
$1,000 or more........... 1.25 1.266 0.813
Assurance Trust 2005(C) Less than $250........... 4.00 4.167 2.600
$250--499................ 3.00 3.093 1.950
$500--749................ 2.50 2.564 1.625
$750--999................ 2.00 2.041 1.300
$1,000 or more........... 1.50 1.523 0.975
<CAPTION>
CONCESSIONS TO
INTRODUCING DEALERS
-------------------
Assurance Trust 1995(A) $ 18.00
14.40
10.80
9.00
7.20
Assurance Trust 2000(B) 21.60
18.00
14.40
10.80
9.00
Assurance Trust 2005(C) 28.80
21.60
18.00
14.40
10.80
</TABLE>
The graduated sales charges above will apply on all purchases on any one
day by the same purchaser of Units only in the amounts stated. For this purpose
purchases during the initial offering period will not be aggregated with
concurrent purchases of any other unit trusts sponsored by the Sponsors.
Purchases in the secondary market of one or more Series sponsored by the
Sponsors that have the same rates of sales charge will be aggregated. Units held
in the name of the spouse of the purchaser or in the name of a child of the
purchaser under 21 years of age are deemed to be registered in the name of the
purchaser. The graduated sales charges are also applicable to a trustee or other
fiduciary purchasing securities for a single trust estate or single fiduciary
account.
Employees of certain of the Sponsors and their affiliates and non-employee
directors of Merrill Lynch & Co., Inc. may purchase Units of this Fund at a
price based on a reduced sales charge of not less than $5.00 per Unit.
Evaluations of the Securities are determined by the Evaluator taking into
account the same factors referred to under Redemption--Computation of Redemption
Price per Unit. The determinations are made each business day as of the
Evaluation Time set forth under Investment Summary, effective for all sales made
since the last evaluation (Section 4.01). The term 'business day', as used
herein and under 'Redemption', shall exclude Saturdays and Sundays; the
following holidays as observed by the New York Stock Exchange: New Year's Day,
Washington's birthday, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving and Christmas; and the following Federal holidays: Martin Luther
King's birthday, Columbus Day and Veteran's Day.
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COMPARISON OF PUBLIC OFFERING PRICE, SPONSORS' INITIAL REPURCHASE PRICE,
SECONDARY MARKET REPURCHASE
PRICE AND REDEMPTION PRICE
On the Evaluation Date the Public Offering Price per Unit (which includes
the sales charge) and the Sponsors' Initial Repurchase Price per Unit (each
based on the offering side evaluation of the Securities in the Fund--see above)
exceeded the Sponsors' Repurchase Price and the Redemption Price per Unit (based
on the bid side evaluation thereof--see Redemption) by the amounts set forth
under Investment Summary.
The initial Public Offering Price per Unit of each Trust and the Initial
Repurchase Price are based on the offering side evaluations of the Securities.
The secondary market Public Offering Price and the Sponsors' Repurchase Price in
the secondary market are based on bid side evaluations of the Securities. Under
current market conditions the bid prices for Stripped Treasury Securities of the
type deposited in the Trusts are expected to be approximately .04% lower than
the offering prices thereof. For this reason, among others (including
fluctuations in the market prices of these Securities and the fact that the
Public Offering Price includes a sales charge), the amount realized by a Holder
upon any sale or redemption of Units may be less than the price paid by him for
those Units.
PUBLIC DISTRIBUTION
During the initial offering period and thereafter to the extent that
additional Units continue to be offered for sale to the public by means of this
Prospectus, Units will be distributed to the public at the Public Offering Price
through the Underwriting Account and dealers. Upon the completion of the initial
offering or of the offering period for additional Units, Units which remain
unsold or which may be acquired in the secondary market (see Market for Units)
may be offered directly to the public by this Prospectus at the secondary market
Public Offering Price determined in the manner provided above.
The Sponsors intend to qualify Units for sale in any states in the U.S. in
which qualification is deemed necessary through the Underwriting Account and by
dealers who are members of the National Association of Securities Dealers, Inc.
The Sponsors do not intend to qualify Units for sale in any foreign countries
and this Prospectus does not constitute an offer to sell Units in any country
where Units cannot lawfully be sold. Sales to dealers and to introducing
dealers, if any, will initially be made at prices which represent a concession
of the amount per Unit specified in the first table above, but Merrill Lynch,
Pierce, Fenner & Smith Incorporated, as Agent for the Sponsors ('Agent for the
Sponsors') reserves the right to change the amount of the concession to dealers
and the concession to introducing dealers from time to time. Any dealer or
introducing dealer may reallow a concession not in excess of the concession to
dealers.
UNDERWRITERS' AND SPONSORS' PROFITS
Upon sale of the Units, the Underwriters, including the Sponsors, will
receive sales charges at the rates set forth in the tables above. The Sponsors
also realized a profit or loss on deposit of the Securities in the Trusts which
is the difference between the cost of the Securities to each Trust (which is
based on the offering side evaluation of the Securities) and the purchase price
of the Securities to the Sponsors. On each subsequent deposit
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<PAGE>
of Securities with respect to the sale of additional Units to the public, the
Sponsors may also realize a profit or loss. During the initial offering period
and thereafter to the extent that additional Units continue to be offered for
sale to the public the Underwriting Account also may realize profits or sustain
losses as a result of fluctuations in the Public Offering Price of the Units.
Cash, if any, made available by buyers of Units to the Sponsors prior to the
settlement dates for purchase of Units may be used in the Sponsors' businesses
subject to the limitations of Rule 15c3-3 under the Securities Exchange Act of
1934 and may be of benefit to the Sponsors.
In maintaining a market for the Units (see Market for Units), the Sponsors
will also realize profits or sustain losses in the amount of any difference
between the prices at which they buy Units (based on the bid side evaluation of
the Securities) and the prices at which they resell the Units (which include the
sales charge) or the prices at which they redeem the Units (based on the bid
side evaluation of the Securities), as the case may be.
MARKET FOR UNITS
During the initial offering period, the Sponsors intend to offer to
purchase Units of each Trust of this Series at prices based upon the offering
side evaluation of the Securities. Thereafter, while the Sponsors are not
obligated to do so, it is their intention to maintain a secondary market for
Units of each Trust of this Series and continuously to offer to purchase Units
of each Trust of this Series at prices, subject to change at any time, which
will be computed on the basis of the bid side of the market, taking into account
the same factors referred to in determining the bid side evaluation of
Securities for purposes of redemption (see Redemption). The Sponsors may
discontinue purchases of Units of any Trust at prices based on the bid side
evaluation of Securities should the supply of Units exceed demand, or for other
business reasons. In this event the Sponsors may nonetheless under certain
circumstances purchase Units, as a service to Holders, at prices based on the
current redemption prices for those Units (see Redemption). The Sponsors, of
course, do not in any way guarantee the enforceability, marketability or price
of any Securities in the Trusts or of the Units. On any given day on which the
secondary market is maintained the price offered by the Sponsors for the
purchase of Units of a Trust shall be an amount not less than the Redemption
Price per Unit for that Trust, based on the aggregate bid side evaluation of the
Securities in that Trust on the date on which the Units are tendered for
redemption (see Redemption). Prospectuses relating to certain other unit trusts
indicate an intention, subject to change on the part of the respective sponsors
of such trusts, to purchase units of those trusts on the basis of a price higher
than the bid prices of the bonds in the trusts. Consequently, depending upon the
prices actually paid, the repurchase price of other sponsors for units of their
trusts may be computed on a somewhat more favorable basis than the repurchase
price offered by the Sponsors for Units of each Trust of this Series in
secondary market transactions. As in this Series, the purchase price per unit of
such unit trusts will depend primarily on the value of the bonds in the
portfolio of the trust.
The Sponsors may redeem any Units they have purchased in the secondary
market or through the Trustee in accordance with the procedures described below
if they determine it is undesirable to continue to hold these Units in their
inventory. Factors which the Sponsors will consider in making such a
determination will include the number of units of all series of all funds which
they hold in their inventory,the saleability of the units and their
13
<PAGE>
estimate of the time required to sell the units and general market conditions.
For a description of certain consequences of any redemption for remaining
Holders, see Redemption.
A Holder who wishes to dispose of his Units should inquire of his bank or
broker as to current market prices in order to determine if there exist
over-the-counter prices in excess of the redemption price.
REDEMPTION
Although it is anticipated that Units in most cases can be sold in the
over-the-counter market for an amount exceeding the Redemption Price per Unit
(see Market for Units), Units may also be redeemed at the office of the Trustee
set forth on the back cover of this Prospectus, upon delivery on any business
day of a request for redemption, and payment of any relevant tax, with any other
fee (Article V). In certain instances the Trustee may require additional
documents including, but not limited to, trust instruments, certificates of
death, appointments as executor or administrator or certificates of corporate
authority.
Except as provided below, the Trustee will effect redemptions in kind.
Thus, on the seventh calendar day following the tender (or if the seventh
calendar day is not a business day, on the first business day prior thereto),
the Holder will be entitled to receive in kind an amount and value of Securities
per Unit equal to the Redemption Price per Unit as determined as of the
Evaluation Time next following the tender. In order to avoid a Holder having
less than a round lot after an in-kind redemption, a Holder will be entitled to
receive securities in kind only if that Holder is entitled to receive at least
$100,000 in face amount of each Stripped Treasury Security in the Portfolio as
part of his distribution; in any other case, the Trustee will deliver tendered
Units for sale to the Sponsors at the equivalent of the Redemption Price per
Unit and then pay the net proceeds of any such sale to the Holder on the day the
Holder would otherwise be entitled to receive the redemption distribution. In an
in-kind redemption the Holder will receive his pro rata portion of the
Redemption Price representing accrued interest on the Treasury Notes and of the
net cash balance in the Trust in cash. (Article V).
Distribution in kind on redemption of Units shall be held by the Trustee as
Distribution Agent, for the account, and for disposition in accordance with the
instructions of, the tendering Holder, as follows:
(a) If the tendering Holder requests cash payment, the Distribution Agent
shall sell the Securities distributed as of the close of business on the date of
tender and remit to the Holder not later than seven calendar days thereafter the
net proceeds of sale after deducting brokerage commissions and transfer taxes,
if any, on the sale.
(b) If the tendering Holder requests distribution in kind, the Distribution
Agent shall sell any portion of the Securities distributed represented by
fractional interests in accordance with the foregoing and distribute net cash
proceeds to the tendering Holder together with whole Securities received on the
in kind distribution.
In order to prevent a Trust from receiving cash on the disposition of less
than a whole Security, the Sponsors will, even if they are not maintaining a
market for Units, purchase any Units tendered at the cash equivalent of the
Redemption Price per Unit and tender those Units for redemption only when a
whole Security can be received in exchange therefor.
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<PAGE>
Any amounts paid on redemption representing income received will be
withdrawn from the Income Account (see Administration of the Fund--Accounts and
Distributions) to the extent funds are available. In implementing these
redemption procedures, the Trustee and Distribution Agent shall make any
adjustments necessary to reflect differences between the Redemption Price of the
Units and the value of the Securities distributed in kind as of the date Units
are tendered.
To the extent that Units in a Trust are redeemed in kind, the size of the
relevant Trust will be reduced but each remaining Unit will continue to
represent the identical face amount of Securities with specified interest rates
and maturities. The value of Securities received upon redemption and the
proceeds received by the Distribution Agent for the account of the redeeming
Holder may be more or less than the amount paid by the Holder depending on the
value of the Securities in the relevant Trust at the time of redemption.
The right of redemption may be suspended and payment postponed for any
period (1) during which the New York Stock Exchange, Inc. is closed other than
for customary weekend and holiday closings or (2) during which, as determined by
the Securities and Exchange Commission ('SEC'), (i) trading on that Exchange is
restricted or (ii) an emergency exists as a result of which disposal or
evaluation of the Securities is not reasonably practicable, or (3) for any other
periods which the SEC may by order permit (Article V).
COMPUTATION OF REDEMPTION PRICE PER UNIT
Redemption Price per Unit of each Trust is computed by the Trustee as of
the Evaluation Time on each June 30 and December 31 (or the last business day
prior thereto), on any business day as of the Evaluation Time next following the
tender of any Unit of a Trust for redemption, and on any other business day
desired by the Trustee or the Sponsors, by adding separately for each Trust (a)
the aggregate bid side evaluation of the Securities in the Trust, (b) cash on
hand in the Trust (other than cash covering contracts to purchase Securities),
(c) accrued and unpaid interest on the Securities up to but not including the
date of redemption and (d) all other assets of the Trust; deducting therefrom
the sum of (x) taxes or other governmental charges against the Trust not
previously deducted, (y) accrued fees and expenses of the Trustee (including
legal and auditing expenses), the Evaluator and counsel, and certain other
expenses and (z) cash held for distribution to Holders of record as of a date
prior to the evaluation; and dividing the result by the number of Units
outstanding as of the date of computation (Section 5.01).
The aggregate current bid or offering price evaluation of the Securities is
determined by the Evaluator in the following manner: (a) on the basis of the
current bid or offering prices for the Securities, (b) if bid or offering prices
are not available for any Securities, on the basis of current bid or offering
prices for comparable securities, (c) by determining the value of the Securities
on the bid or offering side of the market by appraisal or (d) by any combination
thereof. The Evaluator may obtain current price information as to the Securities
from investment dealers or brokers (including the Sponsors) which customarily
deal in this type of security.
15
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While Securities of the type included in the Trusts' Portfolios involve
minimal risk of loss of principal, due to variations in interest rates the
market value of these Securities, and Redemption Price per Unit, can be expected
to fluctuate during the period of an investment in a Trust.
EXPENSES AND CHARGES
FEES
An estimate of the total annual expenses of the Trusts is set forth under
Investment Summary. The Portfolio Supervision Fee for each Trust is based on the
face amount of Securities in the relevant Trust on the first business day of
each calendar year, except that if in any calendar year additional Securities
are deposited the fee for the balance of the year will be based on the face
amounts on each Record Day. The Sponsors' fee, which is not to exceed the
maximum amount set forth under Investment Summary, may exceed the actual costs
of providing portfolio supervisory services for a Trust, but at no time will the
total amount they receive for supervisory services rendered to all series of
Defined Asset Funds--Government Securities Income Fund in any calendar year
exceed the aggregate cost to them of supplying these services in that year. In
addition, the Sponsors may also be reimbursed for bookkeeping or other
administrative services provided to the Trusts in amounts not exceeding their
costs of providing these services (Articles III and VII). The Trustee receives
for its services as Trustee and for reimbursement of expenses incurred on behalf
of a Trust, payable in monthly installments, the amount per Unit set forth under
Investment Summary as Trustee's Annual Fee and Expenses, which includes the
Evaluator's Fee, the estimated Portfolio Supervision Fee, estimated reimbursable
bookkeeping or administrative expenses paid to the Sponsors and certain mailing
and printing expenses. The Trustee also receives benefits to the extent that it
holds funds on deposit in the various non-interest bearing accounts created
under the Indenture. The foregoing fees may be adjusted for inflation in
accordance with the terms of the Indenture without approval of Holders (Articles
III, IV and VIII).
OTHER CHARGES
These include: (a) fees of the Trustee for extraordinary services (Article
VIII), (b) certain expenses of the Trustee (including legal and auditing
expenses) and of counsel designated by the Sponsors (Articles III and VIII), (c)
various governmental charges (Articles III and VIII), (d) expenses and costs of
any action taken to protect any Trust (Article VIII), (e) indemnification of the
Trustee for any losses, liabilities and expenses incurred without gross
negligence, bad faith or willful misconduct on its part (Article VIII), (f)
indemnification of the Sponsors for any losses, liabilities and expenses
incurred without gross negligence, bad faith, willful misconduct or reckless
disregard of their duties (Article VII) and (g) expenditures incurred in
contacting Holders upon termination of a Trust (Article IX). The amounts of
these charges and fees for each Trust are secured by a lien on the relevant
Trust and, if the balances in the Income and Capital Accounts (see below) are
insufficient to provide for amounts payable by that Trust, the Trustee has the
power to sell Securities to pay such amounts (Article VIII).
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ADMINISTRATION OF THE FUND
RECORDS
The Trustee keeps a register of the names, addresses and holdings of all
Holders. The Trustee also keeps records of the transactions of each Trust,
including a current list of the Securities and a copy of the Indenture, which
are available to Holders for inspection at reasonable times during business
hours (Articles VI and VIII).
ACCOUNTS AND DISTRIBUTIONS
The terms of the Securities provide for payment to the Holders thereof
(including the Trusts) upon their maturities. Interest received on any Treasury
Note in a Trust, including that part of the proceeds of any disposition of any
such Note which represents accrued interest and any late payment penalties, is
credited to an Income Account for the relevant Trust and other receipts to a
Capital Account for the relevant Trust (Article III). Distributions for each
Holder as of each Record Day will be made on the following Distribution Day or
shortly thereafter and shall consist of an amount substantially equal to the
Holder's pro rata share of the distributable cash balance of the Income and
Capital Accounts computed as of the close of business on the preceding Record
Day. The first distribution for persons who purchase Units between a Record Day
and a Distribution Day will be made on the second Distribution Day following
their purchase of Units. The Distribution Day for each Trust shall be the second
business day following the maturity of any Stripped Treasury Securities in the
Portfolio of that Trust; the Record Day shall be the fifth business day
immediately preceding the Distribution Day.
The amount to be distributed may change as Securities are paid or sold.
Proceeds received from the disposition or payment of any of the Securities which
are not used for redemption will be held in the Capital Account (Article III).
Amounts, if any, in the Income Account will be distributed to Holders pro rata
upon termination of the Trust. A Reserve Account for each Trust may be created
by the Trustee by withdrawing from the Income or Capital Accounts, from time to
time, amounts deemed necessary to establish a reserve for any material amounts
that may be payable out of that Trust (Article VIII). Funds held by the Trustee
in the various accounts created under the Indenture do not bear interest
(Article VIII).
PORTFOLIO SUPERVISION
Each Trust is part of a unit investment trust and is not an actively
managed fund. Traditional methods of investment management for a managed fund
typically involve frequent changes in a portfolio of securities on the basis of
economic, financial and market analyses. The Portfolios of the Trusts, however,
will not be actively managed and therefore the adverse financial condition of an
issuer will not necessarily require the sale of its Securities from a Trust.
However, experienced financial analysts regularly review the Portfolio and may
direct the disposition of Securities under any of the following circumstances:
(i) a default in payment of amounts due on any Security, (ii) institution of
certain legal proceedings, (iii) existence of any other legal questions or
impediments affecting a Security or the payment of amounts due on the Security,
(iv) default under certain documents adversely affecting debt service or default
in payment of amounts due on other securities of the same issuer or
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guarantor, (v) decline in projected income pledged for debt service on revenue
bond issues, (vi) decline in price of the Security or the occurrence of other
market or credit factors, including advance refunding (i.e, the issuance of
refunding bonds and the deposit of the proceeds thereof in trust or escrow to
retire the refunded Securities on their respective dates), that in the opinion
of the Sponsors would make the retention of the Security detrimental to the
interests of the Holders, (vii) if a Security is not consistent with the
investment objective of the Fund or (viii) if the Trustee has a right to sell or
redeem a Security pursuant to any appliable guarantee or other credit support.
Amounts due on any Securities which is not promptly cured, institution of
certain legal proceedings, default in payment of amounts due on other Treasury
Securities, or decline in price or the occurrence of other market or credit
factors that in the opinion of the Sponsors would make the retention of these
Securities in any Trust detrimental to the interest of the Holders of that
Trust. If a default in payment of amounts due on any Security occurs and if the
Sponsors fail to give instructions to sell or hold the Security, the Indenture
provides that the Trustee, within 30 days of that failure by the Sponsors, shall
sell the Security (Article III). The Sponsors are required to instruct the
Trustee to reject any offer made by an issuer of any of the Debt Obligations to
issue new obligations in exchange and substitution for any Debt Obligations
pursuant to a refunding or refinancing plan.
The Sponsors are authorized to direct the Trustee to deposit Replacement
Securities into the Portfolio to replace any Failed Debt Obligations or, in
connection with the deposit of Additional Securities, when Securities of an
issue originally deposited are unavailable at the time of subsequent deposit as
described more fully below.
Replacement Securities that are replacing Failed Debt Obligations will be
deposited into a Trust within 110 days of the date of deposit of the contracts
that have failed; the purchase price may not exceed the amount of funds reserved
for the purchase of Failed Debt Obligations and must result in a yield to
maturity as of that date of deposit, that is equivalent (taking into
consideration then current market conditions and the relative creditworthiness
of the underlying obligation) to the yield to maturity of the Failed Debt
Obligations. The Replacement Securities shall (i) be Securities issued by the
U.S. Treasury, which if stripped make no current payments of interest or if
interest-bearing are of the same issue; (ii) have a fixed maturity date
identical to that of the Failed Debt Obligation; (iii) not cause the Units to
cease to be rated in the category AAA or better by Standard & Poor's and (iv)
not be when, as and if issued obligations. Whenever a Replacement Security has
been acquired for a Trust, the Trustee shall, within 30 days thereafter, make a
pro rata distribution of the amount, if any, by which the cost to the Trust of
the Failed Debt Obligation exceeded the cost of the Replacement Security plus
any accrued interest or amortization. If Replacement Securities are not
acquired, the Sponsors will, within 30 days after the failure, cause to be
refunded to the Holders the attributable sales charge, plus the attributable
Cost of Securities to Trust listed under Portfolios, plus accrued interest and
amortization attributable to the relevant Security.
The Indenture also authorizes the Sponsors to increase the size and number
of Units of any Trust by the deposit of Additional Securities, contracts to
purchase Additional Securities or cash or a letter of credit with instructions
to purchase Additional Securities in exchange for the corresponding number of
additional Units during the 90-day period subsequent to the Initial Date of
Deposit, provided that the original proportionate relationship among the face
amounts of each Security established on the Initial Date of Deposit (the
'Original
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Proportionate Relationship') is maintained to the extent practicable. Deposits
of Additional Securities subsequent to the 90-day period following the Initial
Date of Deposit must replicate exactly the original proportionate relationship
among the face amounts of Securities comprising the Portfolio at the end of the
initial 90-day period subject to certain events (Article III).
With respect to deposits of Additional Securities (or cash or a letter of
credit with instructions to purchase Additional Securities), in connection with
creating additional Units of a Trust during the 90-day period following the
Initial Date of Deposit, the Sponsors may specify minimum face amounts in which
Additional Securities will be deposited or purchased. If a deposit is not
sufficient to acquire minimum amounts of each Security, Additional Securities
may be acquired in the order of the Security most under-represented immediately
before the deposit when compared to the Original Proportionate Relationship. If
Securities of an issue originally deposited are unavailable at the time of
subsequent deposit or cannot be purchased at reasonable prices or their purchase
is prohibited or restricted by law, regulation or policies applicable to that
Trust or any of the Sponsors, the Sponsors may (1) deposit cash or a letter of
credit with instructions to purchase the Security when it becomes available
(provided that it becomes available within 110 days after the Initial Date of
Deposit), or (2) deposit (or instruct the Trustee to purchase) Securities of one
or more other issues originally deposited or (3) deposit (or instruct the
Trustee to purchase) a Replacement Security which will meet the conditions
described above except that it must have a rating at least equal to that of the
Security it replaces (or, in the opinion of the Sponsors, have comparable credit
characteristics, if not rated). Any funds held to acquire Additional or
Replacement Securities which have not been used to purchase Securities at the
end of the 90-day period beginning with the Initial Date of Deposit, shall be
used to purchase Securities as described above or shall be distributed to
Holders together with the attributable sales charge.
REPORTS TO HOLDERS
The Trustee will furnish Holders with each Distribution a statement of the
amounts of interest and other receipts which are being distributed, expressed in
each case as a dollar amount per Unit. Within a reasonable period of time after
the end of each calendar year and following the termination of the Fund, the
Trustee will furnish to each person who at any time during the calendar year was
a Holder of record a statement (i) summarizing transactions for the year in the
Income, Capital and Reserve Accounts, (ii) identifying Securities sold and
purchased during and listing Securities held at the end of such year, (iii)
stating the Redemption Price per Unit based upon the computation thereof made on
the thirty-first day of December (or the last business day prior thereto) of
such calendar year, and (iv) specifying amounts actually distributed during such
calendar year from the Income Account and from the Capital Account, separately
expressed both as total dollar amounts and as dollar amounts per Unit
outstanding on the record dates for such distributions (Article III). The
accounts of each Trust shall be audited not less frequently than annually by
independent certified public accountants designated by the Sponsors, and the
report of such accountants shall be furnished by the Trustee to Holders upon
request (Article VIII).
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In order to enable them to comply with Federal and state tax reporting
requirements, Holders will be furnished upon request to the Trustee with
evaluations of Securities furnished to it by the Evaluator (Article IV).
CERTIFICATES
Certain of the Sponsors may collect additional charges for registering and
shipping certificates to purchasers. These Certificates are transferable or
interchangeable upon presentation at the office of the Trustee, with a payment
of $2.00 if required by the Trustee (or such other amount as may be specified by
the Trustee and approved by the Sponsors) for each new Certificate and any sums
payable for taxes or other governmental charges imposed upon such transaction
and compliance with the formalities necessary to redeem Certificates (see
Redemption). Mutilated, destroyed, stolen or lost Certificates will be replaced
upon delivery of satisfactory indemnity and payment of expenses incurred
(Article VI).
Alternatively, Holders may elect to hold their Units in uncertificated
form. The Trustee will credit each such Holder's account with the number of
Units purchased by such Holder. This relieves the Holder of the responsibility
of safekeeping of Certificates and of the need to deliver Certificates upon sale
of Units. Uncertificated Units are transferable through the same procedures
applicable to Units evidenced by Certificates (see above), except that no
Certificate need be presented to the Trustee and none will be issued upon
transfer unless requested by the Holder.
AMENDMENT AND TERMINATION
The Sponsors and Trustee may amend the Indenture, without the consent of
the Holders, (a) to cure any ambiguity or to correct or supplement any provision
thereof which may be defective or inconsistent, (b) to change any provision
thereof as may be required by the SEC or any successor governmental agency or
(c) to make such other provisions as shall not materially adversely affect the
interest of the Holders (as determined in good faith by the Sponsors). The
Indenture may also be amended in any respect by the Sponsors and Trustee, or any
of the provisions thereof may be waived, with the consent of the Holders of 51%
of the Units of a Trust then outstanding, provided that no such amendment or
waiver will reduce the interest in a Trust of any Holder without the consent of
such Holder or reduce the percentage of Units required to consent to any such
amendment or waiver without the consent of all Holders (Article VI).
The Fund will terminate and be liquidated upon the maturity, sale,
redemption or other disposition of the last Security held thereunder but in no
event is it to continue beyond the mandatory termination date set forth under
Investment Summary. A Fund may be terminated by the Sponsors if the face amount
of Securities of the relevant Trust is less than the minimum face amount set
forth under Investment Summary, and may be terminated at any time by written
instrument executed by the Sponsors and consented to by the Holders of 51% of
the Units (Articles VIII and IX). The Trustee will deliver written notice of any
termination to each Holder within a reasonable period of time prior to the
termination, specifying the times at which the Holders may surrender their
Certificates for cancellation. Within a reasonable period of time after the
termination, the Trustee must sell all of the Securities then held and
distribute to each Holder, upon surrender for cancellation of his
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Certificates, and after deductions of accrued and unpaid fees, taxes and
governmental and other charges, such Holder's interest in the Income and Capital
Accounts (Article IX). Such distribution will normally be made by mailing a
check in the amount of each Holder's interest in such accounts to the address of
such Holder appearing on the record books of the Trustee.
RESIGNATION, REMOVAL AND LIMITATIONS ON LIABILITY
THE TRUSTEE
The Trustee (as referred to herein, acting in its capacity as Trustee and
Distribution Agent) or any successor may resign upon notice to the Sponsors. The
Trustee may be removed upon the direction of the Holders of 51% of the Units at
any time or by the Sponsors without the consent of any of the Holders if the
Trustee becomes incapable of acting or becomes bankrupt or its affairs are taken
over by public authorities or if for any reason the Sponsors determine in good
faith that the replacement of the Trustee is in the best interest of the
Holders. Such resignation or removal shall become effective upon the acceptance
of appointment by the successor which may in the case of a resigning or removed
Co-Trustee be one or more of the remaining Co-Trustees. In case of such
resignation or removal the Sponsors are to use their best efforts to appoint a
successor promptly and if upon resignation of the Trustee no successor has
accepted appointment within thirty days after notification, the Trustee may
apply to a court of competent jurisdiction for the appointment of a successor
(Article VIII). The Trustee shall be under no liability for any action taken in
good faith in reliance on prima facie properly executed documents or for the
disposition of monies or Securities, nor shall it be liable or responsible in
any way for depreciation or loss incurred by reason of the sale of any Security.
This provision, however, shall not protect the Trustee in cases of wilful
misfeasance, bad faith, gross negligence or reckless disregard of its
obligations and duties. In the event of the failure of the Sponsors to act, the
Trustee may act under the Indenture and shall not be liable for any such action
taken in good faith. The Trustee shall not be personally liable for any taxes or
other governmental charges imposed upon or in respect of the Securities or upon
the interest thereon. In addition, the Indenture contains other customary
provisions limiting the liability of the Trustee (Articles VIII and IX).
THE EVALUATOR
The Evaluator may resign or may be removed, effective upon the acceptance
of appointment by its successor, by the Sponsors, who are to use their best
efforts to appoint a successor promptly. If upon resignation of the Evaluator no
successor has accepted appointment within thirty days after notification, the
Evaluator may apply to a court of competent jurisdiction for the appointment of
a successor (Article IV). Determinations by the Evaluator under the Indenture
shall be made in good faith upon the basis of the best information available to
it; provided, however, that the Evaluator shall be under no liability to the
Trustee, the Sponsors or the Holders for errors in judgment. This provision,
however, shall not protect the Evaluator in cases of wilful misfeasance, bad
faith, gross negligence or reckless disregard of its obligations and duties
(Article IV). The Trustee, the Sponsors and the Holders may rely on any
evaluation furnished by the Evaluator and shall have no responsibility for the
accuracy thereof.
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THE SPONSORS
Any Sponsor may resign if one remaining Sponsor maintains a net worth of
$2,000,000 and is agreeable to such resignation (Article VII). A new Sponsor may
be appointed by the remaining Sponsors and the Trustee to assume the duties of
the resigning Sponsor. If there is only one Sponsor and it shall fail to perform
its duties or becomes incapable of acting or becomes bankrupt or its affairs are
taken over by public authorities, then the Trustee may (a) appoint a successor
Sponsor at rates of compensation deemed by the Trustee to be reasonable and as
may not exceed amounts prescribed by the SEC, or (b) terminate the Indenture and
liquidate the Fund or (c) continue to act as Trustee without terminating the
Indenture (Article VIII). The Agent for the Sponsors has been appointed by the
other Sponsors for purposes of taking action under the Indenture (Article VIII).
If the Sponsors are unable to agree with respect to action to be taken jointly
by them under the Indenture and they cannot agree as to which Sponsor shall
continue to act as sole Sponsor, then Merrill Lynch, Pierce, Fenner & Smith
Incorporated shall continue to act as sole Sponsor (Article VIII). If one of the
Sponsors fails to perform its duties or becomes incapable of acting or becomes
bankrupt or its affairs are taken over by public authorities, then such Sponsor
is automatically discharged and the other Sponsors shall act as Sponsor (Article
VIII). The Sponsors shall be under no liability to the Trusts or to the Holders
for taking any action or for refraining from taking any action in good faith or
for errors in judgment and shall not be liable or responsible in any way for
depreciation or loss incurred by reason of the sale of any Security. This
provision, however, shall not protect the Sponsors in cases of wilful
misfeasance, bad faith, gross negligence or reckless disregard of their
obligations and duties (Section 7.05). The Sponsors and their successors are
jointly and severally liable under the Indenture. A Sponsor may transfer all or
substantially all of its assets to a corporation or partnership which carries on
its business and duly assumes all of its obligations under the Indenture and in
such event it shall be relieved of all further liability under the Indenture
(Article VIII).
MISCELLANEOUS
TRUSTEE
The Trustee is named on the back cover page of this Prospectus and is
either (acting as Co-Trustees) Investors Bank & Trust Company, a Massachusetts
trust company with its unit investment trust servicing group at One Lincoln
Plaza, Boston, Massachusetts 02111 (which is subject to supervision by the
Massachusetts Commissioner of Banks, the Federal Deposit Insurance Corporation
('FDIC') and the Federal Reserve System) and The First National Bank of Chicago,
a national banking association with its corporate trust office at One First
National Plaza, Suite 0126, Chicago, Illinois 60670-0126 (which is subject to
supervision by the Comptroller of the Currency, the FDIC and the Federal Reserve
System); The Bank of New York, a New York banking corporation with its Unit
Investment Trust Department at 101 Barclay Street, New York, New York 10286
(which is subject to supervision by the New York Superintendent of Banks, FDIC
and the Federal Reserve System); Bankers Trust Company, a New York banking
corporation with its corporate trust office at 4 Albany Street, 7th Floor, New
York, New York 10015 (which is subject to supervision by the New York
Superintendent of Banks, the FDIC and the Federal Reserve System); or The Chase
Manhattan Bank (N.A.), a national banking
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association with its Unit Trust Department at 1 Chase Manhattan Plaza--3B, New
York, New York 10081 (which is subject to supervision by the Comptroller of the
Currency, the FDIC and the Federal Reserve System).
LEGAL OPINION
The legality of the Units has been passed upon by Davis Polk & Wardwell,
450 Lexington Avenue, New York, New York 10017, as special counsel for the
Sponsors. Bingham, Dana & Gould, 150 Federal Street, Boston, Massachusetts
02110, act as counsel for Investors Bank & Trust Company and The First National
Bank of Chicago, as Co-Trustees. Emmet Marvin & Martin, 48 Wall Street, New
York, New York 10005, act as counsel for the Bank of New York, as Trustee.
Hawkins, Delafield & Wood, 67 Wall Street, New York, New York 10005, act as
counsel for Bankers Trust Company, as Trustee.
AUDITORS
The Statement of Condition, including the Portfolios, of the Trusts has
been audited by Deloitte & Touche, independent accountants, as stated in their
opinion, and has been so included in reliance upon that opinion given on the
authority of that firm as experts in accounting and auditing.
SPONSORS
Each Sponsor is a Delaware corporation and is engaged in the underwriting,
securities and commodities brokerage business, and is a member of the New York
Stock Exchange, Inc., other major securities exchanges and commodity exchanges,
and the National Association of Securities Dealers, Inc. Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Merrill Lynch Asset Management, a Delaware
corporation, each of which is a subsidiary of Merrill Lynch & Co., Inc., are
engaged in the investment advisory business. Smith Barney Shearson Inc., an
investment banking and securities broker-dealer firm, is an indirect
wholly-owned subsidiary of The Travelers Inc. Prudential Securities
Incorporated, a wholly-owned subsidiary of Prudential Securities Group Inc. and
an indirect wholly-owned subsidiary of the Prudential Insurance Company of
America, is engaged in the investment advisory business. PaineWebber
Incorporated is engaged in the investment advisory business and is a wholly-
owned subsidiary of PaineWebber Group Inc. Dean Witter Reynolds Inc., a
principal operating subsidiary of Dean Witter, Discover & Co., is engaged in the
investment advisory business. Each Sponsor has acted as principal underwriter
and managing underwriter of other investment companies. The Sponsors, in
addition to participating as members of various selling groups or as agents of
other investment companies, execute orders on behalf of investment companies for
the purchase and sale of securities of these companies and sell securities to
these companies in their capacities as brokers or dealers in securities.
Each Sponsor (or a predecessor) has acted as Sponsor of various series of
Defined Asset Funds. A subsidiary of Merrill Lynch, Pierce, Fenner & Smith
Incorporated succeeded in 1970 to the business of Goodbody & Co., which had been
a co-Sponsor of Defined Asset Funds since 1964. That subsidiary resigned as
Sponsor of each of the Goodbody series in 1971. Merrill Lynch, Pierce, Fenner &
Smith Incorporated has been co-Sponsor and the Agent for the Sponsors of each
series of Defined Asset Funds created since 1971. Shearson Lehman Brothers Inc.
('Shearson') and certain of its predecessors were underwriters beginning in 1962
and co-Sponsors from 1965 to 1967 and from 1980 to 1993 of various Defined Asset
Funds. As a result of the acquisition of certain of
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Shearson's assets by Smith Barney, Harris Upham & Co. Incorporated and Primerica
Corporation (now The Travelers Inc.), Smith Barney Shearson Inc. now serves as
co-Sponsor of various Defined Asset Funds. Prudential Securities Incorporated
and its predecessors have been underwriters of Defined Asset Funds since 1961
and co-Sponsors since 1964, in which year its predecessor became successor
co-Sponsor to the original Sponsor. Dean Witter Reynolds Inc. and its
predecessors have been underwriters of various Defined Asset Funds since 1964
and co-Sponsors since 1974. PaineWebber Incorporated and its predecessor have
co-Sponsored certain Defined Asset Funds since 1983.
The Sponsors have maintained secondary markets in Defined Asset Funds for
over 20 years. For decades, informed investors have purchased unit investment
trusts for dependability and professional selection of investments. Defined
Asset Funds offers an array of simple and convenient investment choices, suited
to fit a wide variety of personal financial goals--a buy and hold strategy for
capital accumulation, such as for children's education or a nest egg for
retirement, or attractive, regular current income consistent with relative
protection of capital. There are Defined Funds to meet the needs of just about
any investor. Unit investment trusts are particularly suited for the many
investors who prefer to seek long-term profits by purchasing sound investments
and holding them, rather than through active trading. Few individuals have the
knowledge, resources, capital or time to buy and hold a diversified portfolio on
their own; it would generally take a considerable sum of money to obtain the
breadth and diversity offered by Defined Funds. Sometimes it takes a combination
of Defined Funds to plan for your objectives.
One of the most important decisions an investor faces may be how to
allocate his investments among asset classes. Diversification among different
kinds of investments can balance the risks and rewards of each one. Most
investment experts recommend stocks for long-term capital growth. Long-term
corporate bonds offer relatively high rates of interest income. By purchasing
both defined equity and defined bond funds, investors can receive attractive
current income as well as growth potential, offering some protection against
inflation.
The following chart shows the average annual compounded rate of return of
selected asset classes over the 10-year and 20-year periods ending December 31,
1993, compared to the rate of inflation over the same periods. Of course, this
chart represents past performance of these investment categories and there is no
guarantee of
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future results, either of these categories or of Defined Funds. Defined Funds
also have sales charges and expenses, which are not reflected in the chart.
Stocks (S&P 500)
20 yr 12.76%
10 yr 14.94%
Small-company stocks
20 yr 18.82%
10 yr 9.96%
Long-term corporate bonds
20 yr 10.16%
10 yr 14.00%
U.S. Treasury bills (short-term)
20 yr 7.49%
10 yr 6.53%
Consumer Price Index
20 yr 5.92%
10 yr 3.73%
0 2 4 6 8 10 12%
Source: Ibbotson Associates (Chicago).
Used with permission. All rights reserved.
Instead of having to select individual securities on their own, purchasers
of Defined Funds benefit from the expertise of Defined Asset Funds' experienced
buyers and research analysts. In addition, they gain the advantage of
diversification by investing in Units of a Defined Fund holding securities of
several different issuers. Such diversification can reduce risk, but does not
eliminate it. While the portfolio of a managed fund, such as a mutual fund,
continually changes, defined bond funds offer a defined portfolio and a schedule
of income distributions identified in the prospectus. Investors know, generally,
when they buy, the issuers, maturities, call dates and ratings of the securities
in the portfolio. Of course, the portfolio may change somewhat over time as
additional securities are deposited, as securities mature or are called or
redeemed or as they are sold to meet redemptions and in certain other limited
circumstances. Investors buy bonds for dependability--they know what they can
expect to earn and that principle is distributed as the bonds mature. Investors
also know at the time of purchase their estimated income and current and
long-term returns, subject to credit and market risks and to changes in the
portfolio or the fund's expenses.
Defined Asset Funds offers a variety of fund types. The tax exemption of
municipal securities, which makes them attractive to high-bracket taxpayers, is
offered by Defined Municipal Investment Trust Funds. Municipal
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Defined Funds offer a simple and convenient way for investors to earn monthly
income free from regular Federal income tax. Defined Municipal Investment Trust
Funds have provided investors with tax-free income for more than 30 years.
Defined Corporate Income Funds, with higher current returns than municipal or
government funds, are suitable for Individual Retirement Accounts and other
tax-advantaged accounts and provide monthly income. Defined Government
Securities Income Funds provide a way to participate in markets for U.S.
government securities while earning an attractive current return. Defined
International Bond Funds, invested in bonds payable in foreign currencies, offer
the potential to profit from changes in currency values and possibly from
interest rates higher than paid on comparable U.S. bonds, but investors incur a
higher risk for these potentially greater returns. Historically, stocks have
offered growth of capital, and thus some protection against inflation, over the
long term. Defined Equity Income Funds offer participation in the stock market,
providing current income as well as the possibility of capital appreciation. The
S&P Index Trusts offer a convenient and inexpensive way to participate in broad
market movements. Concept Series seek to capitalize on selected anticipated
economic, political or business trends. Utility Stock Series, consisting of
stocks of issuers with established reputations for regular cash dividends, seek
to benefit from dividend increases. Select Ten Portfolios seek total return by
investing for one year in the ten highest yielding stocks on a designated stock
index.
DESCRIPTION OF RATINGS (as described by Standard & Poor's)
A Standard & Poor's rating on the units of an investment trust (hereinafter
referred to collectively as 'units' and 'fund') is a current assessment of
creditworthiness with respect to the investments held by such fund. This
assessment takes into consideration the financial capacity of the issuers and of
any guarantors, insurers, lessees, or mortgagors with respect to such
investments. The assessment, however, does not take into account the extent to
which fund expenses or portfolio asset sales for less than the fund's purchase
price will reduce payment to the unit holder of the interest and principal
required to be paid on the portfolio assets. In addition, the rating is not a
recommendation to purchase, sell, or hold units, inasmuch as the rating does not
comment as to market price of the units or suitability for a particular
investor.
Funds rated AAA are composed exclusively of assets that are rated AAA by
Standard & Poor's and/or certain short-term investments. Standard & Poor's
defines its AAA rating for such assets as the highest rating assigned by
Standard & Poor's to a debt obligation. Capacity to pay interest and repay
principal is extremely strong.
26
<PAGE>
DEFINED
ASSET FUNDSSM
<TABLE>
<S> <C>
SPONSORS: GOVERNMENT SECURITIES
Merrill Lynch, INCOME FUND
Pierce, Fenner & Smith Inc. U.S. Treasury Series 7--
Unit Investment Trusts Laddered Zero Coupons
P.O. Box 9051 (A Unit Investment Trust)
Princeton, N.J. 08543-9051
(609) 282-8500 This Prospectus does not contain all of the information with respect to the
Smith Barney Shearson Inc. investment company set forth in its registration statement and exhibits
Unit Trust Department relating thereto which have been filed with the Securities and Exchange
Two World Trade Center--101st Floor Commission, Washington, D.C. under the Securities Act of 1933 and the
New York, N.Y. 10048 Investment Company Act of 1940, and to which reference is hereby made.
1-800-298-UNIT No person is authorized to give any information or to make any
PaineWebber Incorporated representations with respect to this investment company not contained in
1200 Harbor Boulevard this Prospectus; and any information or representation not contained herein
Weehawken, N.J. 07087 must not be relied upon as having been authorized. This Prospectus does not
(201) 902-3000 constitute an offer to sell, or a solicitation of an offer to buy,
Prudential Securities Incorporated securities in any state to any person to whom it is not lawful to make such
One Seaport Plaza offer in such state.
199 Water Street
New York, N.Y. 10292
(212) 776-1000
Dean Witter Reynolds Inc.
Two World Trade Center--69th Floor
New York, N.Y. 10048
(212) 392-2222
EVALUATOR:
Kenny S&P Evaluation Services
65 Broadway
New York, N.Y. 10006
INDEPENDENT ACCOUNTANTS:
Deloitte & Touche
1633 Broadway
3rd Floor
New York, N.Y. 10019
CO-TRUSTEES:
The First National Bank of Chicago
Investors Bank & Trust Company
One Lincoln Plaza
P.O. Box 1537
Boston, MA 02205-1537
1-800-338-6019
</TABLE>
12960--3/94
<PAGE>
DEFINED ASSET FUNDS--
THE GOVERNMENT SECURITIES INCOME FUND
CONTENTS OF REGISTRATION STATEMENT
This Post-Effective Amendment to the Registration Statement on Form S-6
comprises the following papers and documents:
The facing sheet of Form S-6.
The cross-reference sheet (incorporated by reference to the Post-Effective
Amendment No. 2 to the Registration Statement on Form S-6 of The Government
Securities Income Fund, GNMA Series E, 1933 Act File No. 2-74993).
The Prospectus.
The Signatures.
The following exhibits:
1.1.1--Form of Standard Terms and Conditions of Trust Effective as of
October 21, 1993 (incorporated by reference to Exhibit 1.1.1 to the
Registration Statement of Municipal Investment Trust Fund, Multi-
state Series--48, 1933 Act File No. 33-50247).
4.1 --Consent of the Evaluator.
4.1.2--Consent of the Rating Agency.
5.1 --Consent of independent accountants.
R-1
<PAGE>
DEFINED ASSET FUNDS--
GOVERNMENT SECURITIES INCOME FUND
U.S. TREASURY SERIES 7--LADDERED ZERO COUPONS
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT,
DEFINED ASSET FUNDS--GOVERNMENT SECURITIES INCOME FUND, U.S. TREASURY SERIES
7--LADDERED ZERO COUPONS (A UNIT INVESTMENT TRUST), CERTIFIES THAT IT MEETS ALL
OF THE REQUIREMENTS FOR EFFECTIVENESS OF THIS REGISTRATION STATEMENT PURSUANT TO
RULE 485(B) UNDER THE SECURITIES ACT OF 1933 AND HAS DULY CAUSED THIS
REGISTRATION STATEMENT OR AMENDMENT TO THE REGISTRATION STATEMENT TO BE SIGNED
ON ITS BEHALF BY THE UNDERSIGNED THEREUNTO DULY AUTHORIZED IN THE CITY OF NEW
YORK AND STATE OF NEW YORK ON THE 23RD DAY OF FEBRUARY, 1994.
SIGNATURES APPEAR ON PAGES R-3, R-4, R-5, R-6 AND R-7.
A majority of the members of the Board of Directors of Merrill Lynch,
Pierce, Fenner & Smith Incorporated has signed this Registration Statement or
Amendment to the Registration Statement pursuant to Powers of Attorney
authorizing the person signing this Registration Statement or Amendment to the
Registration Statement to do so on behalf of such members.
A majority of the members of the Board of Directors of Smith Barney
Shearson Inc. has signed this Registration Statement or Amendment to the
Registration Statement pursuant to Powers of Attorney authorizing the person
signing this Registration Statement or Amendment to the Registration Statement
to do so on behalf of such members.
A majority of the members of the Executive Committee of the Board of
Directors of PaineWebber Incorporated has signed this Registration Statement or
Amendment to the Registration Statement pursuant to Powers of Attorney
authorizing the person signing this Registration Statement or Amendment to the
Registration Statement to do so on behalf of such members.
A majority of the members of the Board of Directors of Prudential
Securities Incorporated has signed this Registration Statement or Amendment to
the Registration Statement pursuant to Powers of Attorney authorizing the person
signing this Registration Statement or Amendment to the Registration Statement
to do so on behalf of such members.
A majority of the members of the Board of Directors of Dean Witter Reynolds
Inc. has signed this Registration Statement or Amendment to the Registration
Statement pursuant to Powers of Attorney authorizing the person signing this
Registration Statement or Amendment to the Registration Statement to do so on
behalf of such members.
R-2
<PAGE>
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
DEPOSITOR
<TABLE>
<S> <C>
By the following persons, who constitute a majority of Powers of Attorney have been filed under
the Board of Directors of Merrill Lynch, Pierce, Form SE and the following 1933 Act File
Fenner & Smith Incorporated: Number: 33-43466
</TABLE>
HERBERT M. ALLISON, JR.
BARRY S. FREIDBERG
EDWARD L. GOLDBERG
STEPHEN L. HAMMERMAN
JEROME P. KENNEY
DAVID H. KAMANSKY
DANIEL T. NAPOLI
THOMAS H. PATRICK
JOHN L. STEFFENS
DANIEL P. TULLY
ROGER M. VASEY
ARTHUR H. ZEIKEL
By
ERNEST V. FABIO
(As authorized signatory for Merrill Lynch, Pierce,
Fenner & Smith Incorporated and
Attorney-in-fact for the persons listed above)
R-3
<PAGE>
PRUDENTIAL SECURITIES INCORPORATED
DEPOSITOR
By the following persons, who constitute a majority of Powers of Attorney
the Board of Directors of have been filed
Prudential Securities Incorporated: under Form SE and
the following 1933
Act File Number:
33-41631
JAMES T. GAHAN
ALAN D. HOGAN
HOWARD A. KNIGHT
GEORGE A. MURRAY
LELAND B. PATON
HARDWICK SIMMONS
By
RICHARD R. HOFFMANN
(As authorized signatory for Prudential Securities
Incorporated and Attorney-in-fact for the persons listed above)
R-4
<PAGE>
SMITH BARNEY SHEARSON INC.
DEPOSITOR
By the following persons, who constitute a majority of Powers of Attorney
the Executive Committee of the Board of Directors of have been filed
Smith Barney Shearson Inc.: under the 1933 Act
File Number:
33-49753
RONALD A. ARTINIAN
STEVEN D. BLACK
JAMES DIMON
ROBERT DRUSKIN
TONI ELLIOTT
LEWIS GLUCKSMAN
THOMAS GUBA
JOHN B. HOFFMAN
A. RICHARD JANIAK, JR.
ROBERT Q. JONES
JEFFREY LANE
JACK H. LEHMAN III
JOEL N. LEVY
HOWARD D. MARSH
WILLIAM J. MILLS II
JOHN C. MORRIS
A. GEORGE SAKS
BRUCE D. SARGENT
MELVIN B. TAUB
JACQUES S. THERIOT
STEPHEN J. TREADWAY
PAUL UNDERWOOD
By
GINA LEMON
(As authorized signatory for
Smith Barney Shearson Inc. and
Attorney-in-fact for the persons listed above)
R-5
<PAGE>
DEAN WITTER REYNOLDS INC.
DEPOSITOR
By the following persons, who constitute a majority of Powers of Attorney
the Board of Directors of Dean Witter Reynolds Inc.: have been filed
under Form SE and
the following 1933
Act File Number:
33-17085
NANCY DONOVAN
CHARLES A. FIUMEFREDDO
JAMES F. HIGGINS
STEPHEN R. MILLER
PHILIP J. PURCELL
THOMAS C. SCHNEIDER
WILLIAM B. SMITH
By
MICHAEL D. BROWNE
(As authorized signatory for Dean Witter Reynolds Inc.
and Attorney-in-fact for the persons listed above)
R-6
<PAGE>
PAINEWEBBER INCORPORATED
DEPOSITOR
By the following persons, who constitute a majority of Powers of Attorney
the Executive Committee of the Board of Directors of have been filed
PaineWebber Incorporated: under
Form SE and the
following 1933 Act
File
Number: 33-28452
JOHN A. BULT
PAUL B. GUENTHER
DONALD B. MARRON
RONALD M. SCHWARTZ
JAMES C. TREADWAY
By
LINDA M. BUCKLEY
(As authorized signatory for PaineWebber Incorporated
and Attorney-in-fact for the persons listed above)
R-7
<PAGE>
Exhibit 5.1
DEFINED ASSET FUNDS--
GOVERNMENT SECURITIES INCOME FUND,
U.S. TREASURY SERIES 7--LADDERED ZERO COUPONS
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Sponsors and Co-Trustees of
Defined Asset Funds--Government Securities Income Fund, U.S. Treasury Series
7--Laddered Zero Coupons:
We hereby consent to the use in Post-Effective Amendment No. 4 to Registration
Statement No. 33-28452 of our opinion dated January 26, 1994 relating to the
financial statements of Government Securities Income Fund, U.S. Treasury Series
7--Laddered Zero Coupons and to the reference to us under the heading 'Auditors'
in the Prospectus which is a part of this Registration Statement.
DELOITTE & TOUCHE
New York, N.Y.
February 23, 1994
<PAGE>
DAVIS POLK & WARDWELL
450 LEXINGTON AVENUE
NEW YORK, NEW YORK 10017
(212) 450-4000
February 23, 1994
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Dear Sirs:
We hereby represent that the Post-Effective Amendments to the registered
unit investment trusts described in Exhibit A attached hereto do not contain
disclosures which would render them ineligible to become effective pursuant to
Rule 485(b) under the Securities Act of 1933.
Very truly yours,
Davis Polk & Wardwell
Attachment
<PAGE>
EXHIBIT A
<TABLE>
<CAPTION>
1933 ACT 1940 ACT
FUND NAME CIK FILE NO. FILE NO.
- --------- --- -------- --------
<S> <C> <C> <C>
DEFINED ASSET FUNDS-GSIF U.S. TREASURY SERIES 7 781768 33-28452 811-2810
DEFINED ASSET FUNDS-CIF ITS-31 791019 33-42205 811-2295
DEFINED ASSET FUNDS-CIF ITS-40 883651 33-48981 811-2295
DEFINED ASSET FUNDS-MITF ITS-116 780708 33-23615 811-1777
DEFINED ASSET FUNDS-MITF ITS-140 781377 33-31132 811-1777
DEFINED ASSET FUNDS-CIF MPS-310 781815 33-49113 811-2295
DEFINED ASSET FUNDS-MITF MPS-217 357438 2-76077 811-1777
DEFINED ASSET FUNDS-MITF MPS-223 701644 2-76831 811-1777
DEFINED ASSET FUNDS-MITF MPS-224 701654 2-76853 811-1777
DEFINED ASSET FUNDS-MITF MPS-277 717531 2-82868 811-1777
DEFINED ASSET FUNDS-MITF MPS-278 718113 2-83118 811-1777
DEFINED ASSET FUNDS-MITF MPS-279 718555 2-83305 811-1777
DEFINED ASSET FUNDS-MITF MINN-1 277229 2-60046 811-1777
DEFINED ASSET FUNDS-MITF MINN-2 277061 2-62659 811-1777
DEFINED ASSET FUNDS-MITF MINN-4 714527 2-81610 811-1777
DEFINED ASSET FUNDS-MITF MINN-5 718094 2-83117 811-1777
DEFINED ASSET FUNDS-MITF MSS-22 892847 33-49171 811-1777
DEFINED ASSET FUNDS-MITF MSS 3J 780498 33-15586 811-1777
DEFINED ASSET FUNDS-MITF MSS 3K 780499 33-15915 811-1777
DEFINED ASSET FUNDS-MITF MSS 3L 780500 33-16072 811-1777
DEFINED ASSET FUNDS-MITF MSS 5A 836057 33-23925 811-1777
DEFINED ASSET FUNDS-MITF MSS 6K 847175 33-31365 811-1777
DEFINED ASSET FUNDS-MITF MSS 9Q 868188 33-44049 811-1777
DEFINED ASSET FUNDS-MITF NYS-109 782083 33-05643 811-1777
DEFINED ASSET FUNDS-MITF NYIS-2 743276 2-90156 811-1777
TOTAL: 25 FUNDS
</TABLE>
