GOVERNMENT SEC INC FD MON PYMT U S TREAS SER 18 D A F, 487, 1994-03-25

GOVERNMENT SEC INC FD MON PYMT U S TREAS SER 18 D A F
487, 1994-03-25

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<PAGE>

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 25, 1994

REGISTRATION NO. 33-52583

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SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D. C. 20549

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

AMENDMENT NO. 1
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:

GOVERNMENT SECURITIES INCOME FUND

MONTHLY PAYMENT U.S. TREASURY SERIES-18
(TARGET MATURITY)

DEFINED ASSET FUNDS

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:

<TABLE>
<S> <C> <C>
MERRILL LYNCH, PIERCE, FENNER & SMITH BARNEY SHEARSON INC.
SMITH INCORPORATED TWO WORLD TRADE CENTER
UNIT INVESTMENT TRUSTS 101ST FLOOR
P.O. BOX 9051 NEW YORK, N.Y. 10048
PRINCETON, N.J. 08543-9051
PRUDENTIAL SECURITIES INCORPORATED DEAN WITTER REYNOLDS INC. PAINEWEBBER INCORPORATED
ONE SEAPORT PLAZA TWO WORLD TRADE CENTER--59TH FLOOR 1285 AVENUE OF THE AMERICAS
199 WATER STREET NEW YORK, N.Y. 10048 NEW YORK, N.Y. 10019
NEW YORK, N.Y. 10292
</TABLE>

D. NAMES AND COMPLETE ADDRESSES OF AGENTS FOR SERVICE:

<TABLE>
<S> <C> <C>
TERESA KONCICK, ESQ. PHILIP BECKER LEE B. SPENCER, JR.
P.O. BOX 9051 130 LIBERTY STREET--29TH FLOOR ONE SEAPORT PLAZA
PRINCETON, N.J. 08543-9051 NEW YORK, N.Y. 10006 199 WATER STREET
NEW YORK, N.Y. 10292
COPIES TO:
THOMAS D. HARMAN, ESQ. ROBERT E. HOLLEY PIERRE DE SAINT PHALLE,
388 GREENWICH STREET 1200 HARBOR BLVD. ESQ.
NEW YORK, N.Y. 10013 WEEHAWKEN, N.J. 07087 450 LEXINGTON AVENUE
NEW YORK, N.Y. 10017
</TABLE>

E. TITLE AND AMOUNT OF SECURITIES BEING REGISTERED:

An indefinite number of Units of Beneficial Interest pursuant to Rule 24f-2
promulgated under the Investment Company Act of 1940, as amended.

F. PROPOSED MAXIMUM OFFERING PRICE TO THE PUBLIC OF THE SECURITIES BEING
REGISTERED:

Indefinite

G. AMOUNT OF FILING FEE:

$500 (as required by Rule 24f-2)

/ x /Check box if it is proposed that this filing will become effective at 9:30
a.m. on March 25, 1994 pursuant to Rule 487.

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<PAGE>
<PAGE>
Defined
Asset FundsSM

<TABLE>
<S> <C>
This Defined Fund is a portfolio of preselected
securities, formed for the purpose of providing safety of
Government capital, monthly income and the benefits of a single
Securities target payout of principal when the last Treasury Note
Income Fund held by the Fund matures. The Fund will invest in a
portfolio of interest-bearing U.S. Treasury obligations
that are backed by the full faith and credit of the
United States Government, with varying maturities of
approximately five years. As each Treasury Note matures,
principal proceeds will be invested into a short-term
U.S. Treasury bill that matures on the same date
as the last maturing Treasury Note. Interest income is
exempt from state and local personal income taxes in all
- -------------------- states. The value of
MONTHLY PAYMENT
U.S. TREASURY Units of the Fund will fluctuate with the value of the
SERIES-18 Portfolio of underlying Securities.
The Estimated Current Return and Estimated Long Term
Return figures shown give different information about the
return to investors. Estimated Current Return on a Unit
shows a net annual current cash return based on the
initial Public Offering Price and the maximum applicable
(TARGET MATURITY) sales charge and is computed by multiplying the estimated
A UNIT INVESTMENT net annual interest rate per Unit by $1,000 and dividing
TRUST the result by the Public Offering Price per
5.68%
ESTIMATED CURRENT
RETURN 1,000 Units (including the sales charge but not including
AS OF MARCH 24, 1994 accrued interest).
Estimated Long Term Return shows a net annual long-term
return to investors holding to maturity based on the
yield on each individual Treasury Note listed under
Portfolio, weighted to reflect the time to maturity and
market value of each Treasury Note,
adjusted to reflect the Public Offering Price (including
the sales charge) and estimated expenses. Unlike
Estimated Current Return, Estimated Long Term Return
takes into account maturities of the underlying Treasury
5.75% Notes and discounts and premiums. These calculations do
ESTIMATED LONG TERM not take into account the yields of the short-term
RETURN Treasury bills to be deposited with the principal
AS OF MARCH 24, 1994 proceeds of the
maturing Treasury Notes. Both Estimated Current Return
and Estimated Long Term Return are subject to
/ /U.S. GOVERNMENT fluctuations with changes in Portfolio composition,
SECURITIES changes in the market value of
the underlying Securities and changes in fees and
/ /MONTHLY INCOME expenses.
Estimated cash flows for the Fund are set forth in the
/ /AAA RATED Prospectus.
/ /REINVESTMENT
Minimum purchase in individual transactions: 1,000 Units.
Minimum purchase for Individual Retirement Accounts and
OPTION Keogh plans: 250 Units.
</TABLE>

<TABLE>
<S> <C>
Merrill Lynch, ---------------------------------------------------------
Pierce Fenner & THESE SECURITIES HAVE NOT BEEN APPROVED OR
Smith Inc. DISAPPROVED BY THE SECURITIES AND EXCHANGE
Smith Barney COMMISSION OR ANY STATE SECURITIES COMMISSION
Shearson Inc. NOR HAS THE COMMISSION OR ANY STATE SECURITIES
PaineWebber COMMISSION PASSED UPON THE ACCURACY OR ADE-
Incorporated QUACY OF THIS PROSPECTUS. ANY REPRESENTATION
Prudential TO THE CONTRARY IS A CRIMINAL OFFENSE.
Securities Inquiries should be directed to the Trustee at
Incorporated 1-800-338-6019.
Dean Witter Reynolds Prospectus dated March 25, 1994.
Inc. Read and retain this Prospectus for future reference.
</TABLE>

<PAGE>
<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.

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Contents

<TABLE>
<S> <C>
Investment Summary..................................... A-3
Underwriting Account................................... A-7
Report of Independent Accountants...................... A-8
Statement of Condition................................. A-8
Portfolio.............................................. A-9
Estimated Cash Flow to Holders......................... A-10
Fund Structure......................................... 1
Risk Factors........................................... 2
Description of the Fund................................ 2
Taxes.................................................. 6
Public Sale of Units................................... 8
Market for Units....................................... 10
Redemption............................................. 11
Expenses and Charges................................... 12
Administration of the Fund............................. 13
Resignation, Removal and Limitations on Liability...... 16
Miscellaneous.......................................... 17
Description of Ratings................................. 20
</TABLE>

A-2
<PAGE>
<PAGE>

INVESTMENT SUMMARY AS OF MARCH 24, 1994 (THE BUSINESS DAY PRIOR TO THE INITIAL
DATE OF DEPOSIT)+

<TABLE>
<S> <C>
ESTIMATED CURRENT RETURN*
(based on Public Offering Price) 5.68%
ESTIMATED LONG TERM RETURN*
(based on Public Offering Price) 5.75%
PUBLIC OFFERING PRICE PER
1,000 UNITS (including 2.00%
sales charge) $ 1,016.78**
FACE AMOUNT OF SECURITIES-- $ 1,000,000
INITIAL NUMBER OF UNITS***-- 1,000,000
SPONSORS' REPURCHASE PRICE AND
REDEMPTION PRICE PER 1,000
UNITS****
(based on bid side evaluation) $ 995.81**
REDEMPTION PRICE PER 1,000 UNITS
LESS THAN:
Public Offering Price by...... $ 20.97
Sponsors' Initial Repurchase
Price by................... $ .63
FRACTIONAL UNDIVIDED INTEREST IN
FUND REPRESENTED BY EACH UNIT-- 1/1,000,000TH
CALCULATION OF PUBLIC OFFERING
PRICE
Aggregate offer side
evaluation of Securities in
Fund....................... $ 996,438.00
--------------
Divided by Initial Number of
Units times 1,000.......... $ 996.44
Plus sales charge of 2.00% of
Public Offering Price
(2.041% of net amount
invested in
Securities)++.............. 20.34
--------------
Public Offering Price per
1,000 Units................ $ 1,016.78
Plus accrued interest per
1,000 Units+++............. 1.44
--------------
Total per 1,000 Units...... $ 1,018.22
--------------
--------------
</TABLE>

<TABLE>
<S> <C>
CALCULATION OF ESTIMATED NET ANNUAL
INTEREST RATE PER 1,000 UNITS (based on
face amount of $1,000 per 1,000 Units)
Annual interest rate per 1,000
Units............................ 5.950%
Less estimated annual expenses per
1,000 Units ($1.74) expressed as
a percentage..................... .174%
---------
Estimated net annual interest rate
per 1,000 Units++++.............. 5.776%
---------
---------

DAILY RATE AT WHICH ESTIMATED NET
INTEREST ACCRUES PER 1,000
UNITS.................................. .0160%
</TABLE>

<TABLE>
<S> <C>
MONTHLY INCOME DISTRIBUTIONS PER 1,000 UNITS
First distribution to be paid on
April 25, 1994 to Holders of
record on April 10, 1994*****.... $ 2.40
Calculation of second and subsequent
distributions, to be paid on the
25th day of each month:
Estimated net annual interest
rate per 1,000 Units times
$1,000........................ $ 57.76
Divided by 12....................... $ 4.81
CAPITAL ACCOUNT DISTRIBUTION
A final distribution from the Capital Account will
be made on or about the second business day
following the maturity of the last maturing
Security listed under Portfolio to Holders of
record on the business day immediately preceding
the date of the distribution.
RECORD DAY--The 10th day of each month
DISTRIBUTION DAY--The 25th day of each month
</TABLE>

<TABLE>
<S> <C> <C>
PREMIUM AND DISCOUNT ISSUES IN PORTFOLIO
Face amount of Securities
with offer side evaluation:
at a discount from par-- 60%
over par-- 40%
SPONSORS' PROFIT (LOSS) ON DEPOSIT $ (93.25)
TRUSTEE'S ANNUAL FEE AND EXPENSES+++++
$1.74 per 1,000 Units (see Expenses and Charges)
PORTFOLIO SUPERVISION FEE
Maximum of $0.25 per $1,000 face amount of
underlying Securities (see Expenses and Charges)
EVALUATOR'S FEE FOR EACH EVALUATION
Minimum $10.00 (see Expenses and Charges)
EVALUATION TIME
3:30 P.M. New York Time
MANDATORY TERMINATION DATE
Trust must be terminated no later than one year
after the maturity date of the last maturing
Security listed under Portfolio (see Portfolio).
MINIMUM VALUE OF FUND
Trust may be terminated if value of Fund is less
than 40% of the face amount of Securities
deposited.
</TABLE>

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* Estimated Current Return represents annual interest income after
estimated annual expenses divided by the maximum public offering price including
a 2.00% maximum sales charge. Estimated Long Term Return is the net annual
percentage return based on the yield on each underlying Security listed under
Portfolio weighted to reflect market value and time to maturity. Estimated Long
Term Return is adjusted for estimated expenses and the maximum offering price.
Estimated Current Return shows current annual cash return to Holders while
Estimated Long Term Return shows the return on Units held to maturity,
reflecting maturities, discounts and premiums on underlying Securities. Each
figure will vary with purchase price and changes in Fund income after expenses.

** Plus accrued interest.
*** The Sponsors may create additional Units during the offering period of
the Fund.

**** During the initial offering period, the Sponsors intend to offer to
purchase Units at prices based on the offer side evaluation 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.)

***** Plus an amount to be determined representing interest accrued but not
expected to be received by December 31, 1994 and required to be distributed by
the United States Internal Revenue Code of 1986, as amended.

+ The Indenture was signed and the initial deposit was made on the date of
this Prospectus.
++ The sales charge will be reduced on a graduated scale in the case of
quantity purchases (see Public Sale of Units--Public Offering Price). The
resulting reduction will increase the long term return on a Unit.
+++ Figure shown represents interest accrued on underlying Securities from
the Initial Date of Deposit to expected date of settlement (normally five
business days after purchase) for Units purchased on the Initial Date of Deposit
(see Description of the Fund--Income; Estimated Long Term Return).
++++ Assumes the Fund will reach a size estimated by the Sponsors. Expenses
will vary with the size of the Fund relative to this estimate.
+++++ Of this amount the Trustee receives annually $.60 per $1,000 face amount
of Securities for its services as Trustee, subject to reduction as the size of
the Fund increases. The Trustee's Annual Fee and Expenses also includes the
Portfolio Supervision Fee and Evaluator's Fee set forth herein.

A-3

INVESTMENT SUMMARY AS OF MARCH 24, 1994 (CONTINUED)

PORTFOLIO AT A GLANCE--

U.S. TREASURY SECURITIES--The Portfolio consists of 5 issues of interest-bearing

U.S. Treasury obligations without conversion or equity features.

INVESTMENT QUALITY--Based on the creditworthiness of the Federal government,
the Units of the Fund have been rated AAA by Standard & Poor's.

MATURITIES--The issues have fixed final maturity dates ranging from 1/15/99
to 4/15/99.

CALL PROTECTION--100% of the aggregate face amount of the Portfolio is not
subject to redemption prior to maturity but is payable in full at the stated
maturity amounts.

OBJECTIVES OF THE FUND--To obtain safety of capital and current monthly
income distributions through investment in a portfolio initially consisting of
interest-bearing U.S. Treasury Notes (the 'Securities') with maturities of
approximately five years. The Fund seeks to provide a convenient single target
payout of principal following the maturity of the last maturing Security in the
Portfolio by reinvesting the proceeds of principal returned as each Security
matures in short-term Treasury bills, each of which will mature on the maturity
date of the last maturing Security listed under Portfolio. The Securities are
direct obligations of the United States and are backed by its full faith and
credit. The Fund is also formed for the purpose of passing through to Holders in
all states the exemption from state and local personal income taxes afforded to
direct owners of U.S. obligations (see Taxation on page A-6 and Taxes).

FUND PORTFOLIO--5 different issues of short-intermediate term U.S. Treasury
Notes. The percentage relationships on the Initial Date of Deposit are as
follows: 6.375% coupons maturing 1/15/99, 20%; 5.000% coupons maturing 1/31/99,
20%; 5.500% coupons maturing 2/28/99, 20%; 5.875% coupons maturing 3/31/99, 20%;
7.000% coupons maturing 4/15/99, 20%. As successive issues mature, principal
proceeds will be reinvested in short-term Treasury bills that will all mature on
the same date as the last maturing Security listed under Portfolio.

The assured payment of principal and interest afforded by U.S. Treasury
Securities may make investment in the Fund particularly well suited for purchase
by Individual Retirement Accounts ('IRAs'), Keogh plans, and other tax-deferred
retirement plans. In addition, the ability to buy single Units enables these
investors to tailor the dollar amount of their purchases of Units to take
maximum possible advantage of the annual deductions available for contributions
to these plans (see Retirement Plans).

RISK FACTORS--U.S. Government securities are not affected by credit risk but
are subject to changes in market value resulting from changes in interest rates.
Therefore, an investment in Units of the Fund should be made with an
understanding of the risks which an investment in fixed-rate short-intermediate
term debt obligations may entail, including the risk that the value of the
Portfolio and hence of the Units will decline with increases in interest rates
(see Risk Factors).

The Sponsors may deposit additional Securities in the Fund (where additional
Units are to be offered to the public) subsequent to the Initial Date of
Deposit, in each instance maintaining the original percentage relationship among
the principal amounts of Securities of specified interest rates and maturities
in the Portfolio (see Fund Structure; Description of the Fund--The Portfolio).

PUBLIC OFFERING PRICE--This Series is offered on the basis that each Unit
initially represents approximately $1.00 principal amount of deposited
Securities on the Initial Date of Deposit. The minimum purchase in individual
transactions is 1,000 Units; the minimum purchase for individual retirement and
Keogh accounts and other tax-deferred retirement plans is
250 Units.

During the initial offering period, the Public Offering Price per 1,000
Units is equal to the aggregate offer 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 times
1,000, plus a sales charge of 2.041%* of the offer side evaluation per 1,000
Units (the net amount invested); this results in a sales charge of 2.00%* of the
Public Offering Price. The secondary market Public Offering Price is based on
the bid side evaluation of the underlying Securities, plus a sales charge of
2.302%* of the bid side evaluation per Unit; this results in a sales charge of
2.25%* of the secondary market Public Offering Price. Units are offered at the
Public Offering Price computed as of the Evaluation Time for all sales made
subsequent to the previous evaluation, plus cash per Unit in the Capital Account
not allocated to the purchase of particular Securities and net interest accrued.
The Public Offering Price on the Initial Date of Deposit, and on subsequent
dates, will vary from the Public Offering Price set forth on page A-3 (see
Public Sale of Units--Public Offering Price and Redemption).

The figures above assume a purchase of 1,000 Units. The price of a single
Unit, or any multiple thereof, is calculated simply by dividing the Public
Offering Price per 1,000 Units above, by 1,000, and multiplying by the number of
Units purchased.

- ---------------
* This sales charge will be reduced on a graduated scale in the case of quantity
purchases of Units (see Public Sale of Units--Public Offering Price).

A-4

<PAGE>
<PAGE>
Defined
Asset Funds

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<S> <C>
Investor's Guide Defined Government Securities Income Fund
Our defined portfolios of U.S. Treasury securities offer
investors a simple and convenient way to participate in
the U.S. Treasury market and obtain monthly income while
earning an attractive return.
The U.S. Treasury Target Maturity Fund
The Target Maturity Fund offers a conservative way to
receive dependable income and your principal back at a
predetermined time. With this investment, every interest
payment and the return of your principal are
Government planned ahead. You know in advance when you will receive
Securities them; interest is paid monthly, and your principal is
Income Fund returned when the Fund matures. However, income can vary
with changes in the portfolio and Fund expenses. Unit
price also varies.
Target Maturity for Scheduled Return of Principal
The Fund initially invests exclusively in U.S. Treasury
notes with maturities of about five years. The last
maturity is the target maturity,
- -------------------- shortly after which all of your principal will be
returned. The amount you receive may be more or less than
your cost.
MONTHLY PAYMENT
U.S. TREASURY SERIES Automatic Reinvestment Keeps Your Assets at Work
(TARGET MATURITY) As each note matures, proceeds will be invested into
treasury bills set to mature on or about the target
maturity date. This program is designed to keep your
money working. Instead of receiving principal back in
several installments, the Fund will provide a single
final payout of principal at the target maturity date,
reducing the uncertainty of investing.
The Credit Safety of U.S. Treasury Issues
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 full faith and credit of the
Government, only the securities it holds. The value of
the units will fluctuate with changes in market
conditions.
AAA-Rated Investment Quality
Based on the creditworthiness of the U.S. treasury
securities in the portfolio, Standard & Poor's has rated
units of the Fund AAA, its highest rating. Government
backing relates to the securities in the Fund and not to
the Fund's units.
Monthly Income Distributions
Although the securities themselves pay semiannually, the
Fund will distribute income monthly. Principal will be
reinvested and distributed in a single target principal
payment upon maturity of the last maturing security in
the Fund.
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 securities directly. Depending on where you
live, these exemptions could be very important and could
increase the after-tax return you receive.
Optional Reinvestment to Increase Your Holdings
You can take your monthly income in cash or elect to
purchase additional units of the Fund at no sales charge.
By reinvesting your income, you not only increase your
holdings, but gain the important benefits that monthly
compounding can add to your total return.
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.
</TABLE>

This page may not be distributed unless included in a current prospectus.
Investors should refer to the prospectus for further information.
<PAGE>
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(This page has been left blank intentionally.)
<PAGE>
<PAGE>

AUTHORIZATION FOR REINVESTMENT
GOVERNMENT SECURITIES INCOME FUND
MONTHLY PAYMENT U.S. TREASURY SERIES-18
DEFINED ASSET FUNDS
M YES, I WANT TO PARTICIPATE IN THE FUND'S REINVESTMENT PLAN AND
PURCHASE ADDITIONAL UNITS OF THE FUND EACH MONTH.
I hereby acknowledge receipt of the Prospectus for Government
Securities Income Fund, Monthly Payment U.S. Treasury Series-18,
Defined Asset Funds and authorize Investors Bank & Trust Company
to pay income distributions on my Units as indicated below
(distributions to be reinvested will be paid for my accounts to
Investors Bank & Trust Company.)

<TABLE>
<S> <C> <C>
Income distributions (check one): M in cash M reinvested
</TABLE>

Please print or type

<TABLE>
<S> <C>
Name
Registered Holder
Address
Registered Holder
(Two signatures required if joint
tenancy)
City State Zip Code
</TABLE>

This page is a self-mailer. Please complete the information above,
cut along the dotted line, fold along the lines on the reverse
side, tape, and mail with the Trustee's address displayed on the
outside.

<TABLE>
<S> <C>
NO POSTAGE
NECESSARY
IF MAILED
IN THE
UNITED STATES

BUSINESS REPLY MAIL
FIRST CLASS PERMIT NO. 7036 BOSTON, MA
POSTAGE WILL BE PAID BY ADDRESSEE
GOVERNMENT SECURITIES INCOME FUND
MONTHLY PAYMENT U.S. TREASURY SERIES-18
DEFINED ASSET FUNDS
INVESTORS BANK & TRUST COMPANY
P.O. BOX 1537
BOSTON, MA 02205-1537
</TABLE>

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(Fold along this line.)

<PAGE>
<PAGE>
EFFECT OF STATE PERSONAL INCOME TAX EXEMPTION

The following chart shows what the return on a security that is subject to state
personal income taxes would have to be in order to equal 5.68% Estimated Current
Return and 5.75% Estimated Long Term Return on the Monthly Payment U.S. Treasury

Series. This Trust is free from state personal income taxes in all states; the
comparable security would be subject to deduction of state personal income taxes
at the maximum state rate. Of course, if you are not in the maximum state
personal income tax bracket, the fully taxable equivalent return would be less.

<TABLE>
<CAPTION>
FULLY TAXABLE RETURN FULLY TAXABLE RETURN
EQUIVALENT TO 5.68% EQUIVALENT TO 5.75%
MAXIMUM STATE ESTIMATED CURRENT ESTIMATED LONG MAXIMUM STATE
PERSONAL RETURN ON MONTHLY TERM RETURN ON PERSONAL
INCOME PAYMENT MONTHLY PAYMENT INCOME
STATE TAX RATE (A) U.S. TREASURY SERIES U.S. TREASURY SERIES STATE TAX RATE (A)
<S> <C> <C> <C> <C> <C>
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Alabama 5.000%(b) 5.98% 6.05% Nebraska 6.990%
<CAPTION>
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<S> <C> <C> <C> <C> <C>
Alaska 0.000 5.68 5.75 Nevada 0.000
<CAPTION>
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<S> <C> <C> <C> <C> <C>
Arizona 7.000(b) 6.11 6.18 New Hampshire 5.000
<CAPTION>
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<S> <C> <C> <C> <C> <C>
Arkansas 7.000 6.11 6.18 New Jersey 6.650
<CAPTION>
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<S> <C> <C> <C> <C> <C>
California 11.000 6.38 6.46 New Mexico 8.500
<CAPTION>
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<S> <C> <C> <C> <C> <C>
Colorado 5.000 5.98 6.05 New York 7.875
<CAPTION>
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<S> <C> <C> <C> <C> <C>
Connecticut 4.500 5.95 6.02 North Carolina 7.750
<CAPTION>
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<S> <C> <C> <C> <C> <C>
Delaware 7.700 6.15 6.23 North Dakota 12.000(g)
<CAPTION>
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<S> <C> <C> <C> <C> <C>
Florida 0.000 5.68 5.75 Ohio 7.500
<CAPTION>
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<S> <C> <C> <C> <C> <C>
Georgia 6.000 6.04 6.12 Oklahoma 10.000(b)(d)
<CAPTION>
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<S> <C> <C> <C> <C> <C>
Hawaii 10.000 6.31 6.39 Oregon 9.000(b)
<CAPTION>
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<S> <C> <C> <C> <C> <C>
Idaho 8.200 6.19 6.26 Pennsylvania 2.800
<CAPTION>
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<S> <C> <C> <C> <C> <C>
Illinois 3.000 5.86 5.93 Puerto Rico 36.000(h)
<CAPTION>
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<S> <C> <C> <C> <C> <C>
Indiana 3.400 5.88 5.95 Rhode Island 10.890(e)
<CAPTION>
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<S> <C> <C> <C> <C> <C>
Iowa 9.980(b) 6.31 6.39 South Carolina 7.000
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Kansas 7.750 6.16 6.23 South Dakota 0.000
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Kentucky 6.000 6.04 6.12 Tennessee 6.000
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Louisiana 6.000 6.04 6.12 Texas 0.000
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Maine 8.500 6.21 6.28 Utah 7.200(c)
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Maryland 6.000 6.04 6.12 Vermont 9.900(e)(f)
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Massachusetts 12.000 6.45 6.53 Virginia 5.750
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Michigan 4.600 5.95 6.03 Washington 0.000
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Minnesota 8.500 6.21 6.28 West Virginia 6.500
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Mississippi 5.000 5.98 6.05 Wisconsin 6.930
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Missouri 6.000 6.04 6.12 Wyoming 0.000
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Montana 11.000 6.38 6.46 Dist. of Columbia 9.500
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------

<CAPTION>
FULLY TAXABLE RETURN FULLY TAXABLE RETURN
EQUIVALENT TO 5.68% EQUIVALENT TO 5.75%
ESTIMATED CURRENT ESTIMATED LONG
RETURN ON MONTHLY TERM RETURN ON
PAYMENT MONTHLY PAYMENT
STATE U.S. TREASURY SERIES U.S. TREASURY SERIES
<S> <C> <C>
- --------------
Alabama 6.11% 6.18%
- --------------
<S> <C> <C>
Alaska 5.68 5.75
- --------------
<S> <C> <C>
Arizona 5.98 6.05
- --------------
<S> <C> <C>
Arkansas 6.08 6.16
- --------------
<S> <C> <C>
California 6.21 6.28
- --------------
<S> <C> <C>
Colorado 6.17 6.24
- --------------
<S> <C> <C>
Connecticut 6.16 6.23
- --------------
<S> <C> <C>
Delaware 6.45 6.53
- --------------
<S> <C> <C>
Florida 6.14 6.22
- --------------
<S> <C> <C>
Georgia 6.31 6.39
- --------------
<S> <C> <C>
Hawaii 6.24 6.32
- --------------
<S> <C> <C>
Idaho 5.84 5.92
- --------------
<S> <C> <C>
Illinois 8.88 8.98
- --------------
<S> <C> <C>
Indiana 6.37 6.45
- --------------
<S> <C> <C>
Iowa 6.11 6.18
- --------------
<S> <C> <C>
Kansas 5.68 5.75
- --------------
<S> <C> <C>
Kentucky 6.04 6.12
- --------------
<S> <C> <C>
Louisiana 5.68 5.75
- --------------
<S> <C> <C>
Maine 6.12 6.20
- --------------
<S> <C> <C>
Maryland 6.30 6.38
- --------------
<S> <C> <C>
Massachusetts 6.03 6.10
- --------------
<S> <C> <C>
Michigan 5.68 5.75
- --------------
<S> <C> <C>
Minnesota 6.07 6.15
- --------------
<S> <C> <C>
Mississippi 6.10 6.18
- --------------
<S> <C> <C>
Missouri 5.68 5.75
- --------------
<S> <C> <C>
Montana 6.28 6.35
- --------------
</TABLE>

This Chart incorporates current applicable State income tax rates and assumes
that all income would otherwise be taxed at the investor's highest tax rate. If
you live in a locality which imposes local personal income taxes, the fully
taxable equivalent return may be greater than as shown on this chart. Yield
figures are for example only.

(a) Based upon net amount subject to State income tax after deductions and
exemptions. This Chart does not reflect other possible tax factors, such as
the alternative minimum tax, personal exemptions, the phase out of
exemptions, itemized deductions and the possible partial disallowance of
deductions. Consequently, Holders are urged to consult their own tax
advisors in this regard.

(b) This state allows in any taxable year, the deduction from gross income of
payments of federal tax liability in that year.

(c) This state allows in any taxable year, the deduction from gross income of
50% of amounts paid on federal tax liability in that year.

(d) The maximum applicable rate may be 7% if the taxpayer chooses not to deduct
payments of federal tax liability

(e) This rate is calculated as a percentage of the highest federal personal
income tax rate of 39.6%.

(f) The rate shown includes the maximum surtax imposed by this state of 6% of
federal personal income tax liability.

(g) The maximum applicable rate may be 14% of adjusted federal personal income
tax liability if the state tax calculated on that basis is less than the
state tax calculated on the basis of the rate shown above.

(h) An alternate basic tax may be assessed if greater than the tax calculated on
the basis of the rate shown above.

A-5

<PAGE>
<PAGE>
THE EFFECT OF VOLUME DISCOUNTS

For larger purchases the sales charge has been reduced. This increases your
effective 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
business day prior to the date of the prospectus.

INITIAL OFFERING PERIOD

<TABLE>
<CAPTION>
SALES CHARGE AS
A PERCENTAGE OF THE ESTIMATED ESTIMATED
OFFER SIDE CURRENT LONG TERM
NUMBER OF UNITS PUBLIC OFFERING PRICE RETURN RETURN
<S> <C> <C> <C>
- -------------------- --------------------- --------- ---------

LESS THAN 500,000 2.00% 5.68% 5.75%
<CAPTION>
- -------------------------------------------------------------------------
<S> <C> <C> <C>

500,000-999,999 1.50% 5.71% 5.78%

1,000,000 or more 1.00% 5.74% 5.81%
</TABLE>

SECONDARY MARKET

<TABLE>
<CAPTION>
SALES CHARGE AS
A PERCENTAGE OF THE ESTIMATED ESTIMATED
BID SIDE CURRENT LONG TERM
NUMBER OF UNITS PUBLIC OFFERING PRICE RETURN RETURN
<S> <C> <C> <C>
- -------------------- --------------------- --------- ---------

LESS THAN 500,000 2.25% 5.67% 5.76%
<CAPTION>
- -------------------------------------------------------------------------
<S> <C> <C> <C>

500,000-999,999 1.75% 5.70% 5.79%

1,000,000 or more 1.25% 5.73% 5.82%
</TABLE>

A-6

INVESTMENT SUMMARY AS OF MARCH 24, 1994 (CONTINUED)

MONTHLY INCOME DISTRIBUTIONS--Monthly income distributions will be made in
cash on or shortly after the 25th day of each month to Holders of record on the
10th day of the month commencing with the first distribution on the date
indicated on page A-3. A distribution from the Capital Account will be made in
cash when the last maturing Security in the Fund matures. (See Administration of
the Fund--Accounts and Distributions). Alternatively, Holders may elect to have
their monthly income distributions reinvested in whole or fractional Units of
the Fund at no sales charge (see Administration of the Fund--Reinvestment Plan).
Holders electing to reinvest their monthly income distributions will receive
additional Units and therefore will own a greater percentage of the Fund than
Holders who receive their distributions in cash.

Distributions of any capital gain net income (i.e., the excess of capital
gains over capital losses) recognized by the Fund in any taxable year will be
made annually shortly before or after the end of the year. These distributions
may also be reinvested in additional Units of the Fund. This reinvestment option
may be modified or cancelled at the discretion of the Sponsors. (See
Administration of the Fund--Reinvestment Plan.)

During approximately the last four months of the Fund, the proceeds from
each maturing U.S. Treasury Note will be reinvested into a short-term U.S.
Treasury bill with a maturity identical to that of the last maturing Treasury
Note in the Fund. Thereafter, a distribution from the Capital Account will be
made in cash when the last maturing Treasury Note and the Treasury bills in the
Fund mature. (See Administration of the Fund--Accounts and Distributions.)

ESTIMATED CURRENT RETURN; ESTIMATED LONG TERM RETURN--Estimated Current
Return on a Unit shows the return based on the Public Offering Price and the
maximum applicable sales charge of 2.00%* and is computed by multiplying the
estimated net annual interest rate per Unit (which shows the return per Unit
based on $1.00 face amount) by 1,000 and dividing the result by the Public
Offering Price per 1,000 Units (not including accrued interest). Estimated Long
Term Return on a Unit of the Fund shows a net annual current long-term return to
investors holding to maturity based on the yield on the individual Treasury
Notes listed under Portfolio weighted to reflect the time to maturity and market
value of each Treasury Note in the Portfolio, adjusted to reflect the Public
Offering Price (including the maximum applicable sales charge of 2.00%*) and
estimated expenses. These calculations do not take into account the yields on
the short-term Treasury bills to be deposited in the Fund with the proceeds of
the maturing Treasury Notes listed under Portfolio. The net annual interest rate
per Unit and the net annual current return and long-term return to investors
will vary with changes in the fees and expenses of the Trustee and the Sponsors
and the fees of the Evaluator which are paid by the Fund and with the payment,
exchange, redemption, sale, maturity or substitution of underlying Securities;
the Public Offering Price will vary with any reduction in sales charge paid in
the case of quantity purchases as well as with fluctuations in the offer side
evaluation of the underlying Securities. Therefore, it can be expected that the
Estimated Current Return and Estimated Long Term Return will fluctuate in the
future. (See Description of the Fund--Income; Estimated Current Return;
Estimated Long Term Return.)

TAXATION--The Sponsors believe that Holders who are individuals will not be
subject to any state personal income taxes on distributions of the Fund's
interest income. Distributions of ordinary income or capital gain from the Fund
will constitute dividends for Federal income tax purposes, but will not be
eligible for the dividends-received deduction for corporations. Distributions to
Holders who are not U.S. citizens or residents will generally be subject to
withholding tax at the statutory rate of 30% (or a lesser treaty rate). (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 plus
accrued interest.

UNDERWRITING ACCOUNT

The names and addresses of the Underwriters are:

<TABLE>
<S> <C> <C>
Merrill Lynch, Pierce, Fenner & Smith Incorporated P.O. Box 9051, Princeton, N.J. 08543-9051
Smith Barney Shearson Inc. Two World Trade Center--101st Floor,
New York, N.Y. 10048
PaineWebber Incorporated 1285 Avenue of the Americas, New York, N.Y. 10019
Prudential Securities Incorporated One Seaport Plaza--199 Water Street,
New York, N.Y. 10292
Dean Witter Reynolds Inc. Two World Trade Center, 59th Floor,
New York, N.Y. 10048
Gruntal & Co. Incorporated 14 Wall Street, New York, N.Y. 10001
Mabon Securities Group 165 Broadway, New York, N.Y. 10006
</TABLE>

Each Underwriter's interest in the Underwriting Account will depend upon the
number of Units acquired through the issuance of additional Units.

- ---------------
* This sales charge will be reduced on a graduated scale in the case of quantity
purchases of Units (see Public Sale of Units--Public Offering Price).

A-7

<PAGE>
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS

The Sponsors, Co-Trustees and Holders of Government Securities Income Fund,
Monthly Payment U.S. Treasury Series-18 (Target Maturity), Defined Asset Funds:

We have audited the accompanying statement of condition, including the
portfolio, of Government Securities Income Fund, Monthly Payment U.S. Treasury
Series-18 (Target Maturity), Defined Asset Funds as of March 25, 1994. This
financial statement is the responsibility of the Co-Trustees. Our responsibility
is to express an opinion on this financial statement based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. The deposit on March 25,
1994 of an irrevocable letter or letters of credit for the purchase of
securities, as described in the statement of condition, was 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 audit provides a reasonable basis for our opinion.

In our opinion, the financial statement referred to above presents fairly, in
all material respects, the financial position of Government Securities Income
Fund, Monthly Payment U.S. Treasury Series-18 (Target Maturity), Defined Asset
Funds at March 25, 1994 in conformity with generally accepted accounting
principles.

DELOITTE & TOUCHE
New York, N.Y.

March 25, 1994

GOVERNMENT SECURITIES INCOME FUND

MONTHLY PAYMENT U.S. TREASURY SERIES-18
(TARGET MATURITY)

DEFINED ASSET FUNDS

STATEMENT OF CONDITION AS OF INITIAL DATE OF DEPOSIT, MARCH 25, 1994

<TABLE>
<S> <C> <C>
TRUST PROPERTY
Investment in Securities--
Contracts to purchase Securities(1)................. $ 996,438.00
Accrued interest to Initial Date of Deposit on underlying
Securities.................................................... 10,833.93
--------------
Total............................................ $ 1,007,271.93
--------------
--------------
LIABILITY AND INTEREST OF HOLDERS
Liability--Accrued interest to Initial Date of Deposit on
underlying Securities(2)................................. $ 10,833.93
Interest of Holders--
1,000,000 Units of fractional undivided interest
outstanding:
Cost to investors(3)................................ $ 1,016,778.00
Gross underwriting commissions(4)................... (20,340.00)
--------------
Net amount applicable to investors............................................... 996,438.00
--------------
Total............................................................... $ 1,007,271.93
--------------
--------------
</TABLE>

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

(1) Aggregate cost to the Fund of the Securities listed under Portfolio is based
on the offering side evaluation determined by the Evaluator at the
Evaluation Time on the business day prior to the Initial Date of Deposit as
set forth under Public Sale of Units--Public Offering Price. See also the
column headed Cost of Securities to Fund under Portfolio. An irrevocable
letter or letters of credit in the amount of $1,007,365.18 has been
deposited with the Trustee. The amount of such letter or letters of credit
includes $996,531.25 (equal to the purchase price to the Sponsors) for the
purchase of $1,000,000 face amount of Securities in connection with
contracts to purchase Securities, plus $10,833.93 covering accrued interest
to the earlier of the date of settlement for the purchase of Units or the
date of delivery of the Securities. The letter or letters of credit has been
issued by Banca Nazionale Dell'Agricoltura, New York Branch.

(2) Representing, as set forth under Description of the Fund--Income; Estimated
Long Term Return, a special distribution by the Trustee of an amount equal
to accrued interest on the Securities as of the Initial Date of Deposit.
(3) Aggregate public offering price (exclusive of interest) computed on the
basis of the offering side evaluation of the underlying Securities as of the
Evaluation Time on the Business Day prior to the Initial Date of Deposit.
(4) Assumes sales charge of 2.00% computed on the basis set forth under Public
Sale of Units--Public Offering Price.

A-8

<PAGE>
<PAGE>
PORTFOLIO OF GOVERNMENT ON THE INITIAL DATE OF DEPOSIT,

SECURITIES INCOME FUND, MONTHLY March 25, 1994
PAYMENT U.S. TREASURY SERIES-18 (Target Maturity)

DEFINED ASSET FUNDS

<TABLE>
<CAPTION>
YIELD TO
MATURITY ON COST OF
PORTFOLIO NO. AND TITLE OF FACE INITIAL DATE OF SECURITIES
SECURITIES CONTRACTED FOR AMOUNT COUPON MATURITY DEPOSIT TO FUND(1)
<C> <S> <C> <C> <C> <C> <C>
----------- ------ --------- --------------- --------------
1. United States Treasury Notes $ 200,000 6.375% 1/15/99 6.008% $ 203,000.00
2. United States Treasury Notes 200,000 5.000 1/31/99 6.014 191,562.00
3. United States Treasury Notes 200,000 5.500 2/28/99 6.033 195,500.00
4. United States Treasury Notes 200,000 5.875 3/31/99 6.050 198,500.00
5. United States Treasury Notes 200,000 7.000 4/15/99 6.083 207,876.00
----------- --------------
$ 1,000,000 $ 996,438.00
----------- --------------
----------- --------------
</TABLE>

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

(1) Evaluation of Securities made on the basis of current offer side evaluation
as determined by the Evaluator. The offer side evaluation is greater than
the current bid side evaluation of the Securities which is the basis on
which Redemption Price per Unit is determined (see Redemption). The
aggregate value based on the bid side evaluation on the Initial Date of
Deposit was $995,808.00, which is $630.00 (approximately .063% of the
aggregate face amount) lower than the aggregate Cost of Securities to Fund
based on the offer side evaluation. Price of Securities was computed on the
basis of the offer side evaluation at the Evaluation Time on the business
day prior to the Initial Date of Deposit.

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

All Securities are represented by contracts to purchase these Securities. The

contracts to purchase Securities were acquired on March 24, 1994.

A-9

<PAGE>
<PAGE>
GOVERNMENT SECURITIES INCOME FUND

MONTHLY PAYMENT U.S. TREASURY SERIES-18
(TARGET MATURITY)

ESTIMATED CASH FLOW TO HOLDERS

The table below sets forth the per 1,000 Units estimated monthly
distributions of interest to Holders. The table assumes no changes in expenses,
no changes in current interest rates, no exchanges, redemptions, sales or
prepayments of the underlying Securities prior to maturity and the receipt of
principal upon maturity. In addition, no account is taken of the yields on the
short-term Treasury bills to be deposited in the Fund with the proceeds of the
maturing Treasury Notes listed under Portfolio. Actual distributions may vary.
All fractions have been rounded.

TABLE OF ESTIMATED CASH FLOW

<TABLE>
<CAPTION>
DATE AMOUNT
<S> <C>
- ------------------------------- ----------

April 1994 $ 2.40

May 1994-January 1999 4.81

February 1999 2.91

March 1999 1.99

April 1999 1,001.16
</TABLE>

A-10

<PAGE>
<PAGE>
(This page has been left blank intentionally.)
<PAGE>
<PAGE>
GOVERNMENT SECURITIES INCOME FUND
MONTHLY PAYMENT U.S. TREASURY SERIES
DEFINED ASSET FUNDS

FUND STRUCTURE

This Series (the 'Fund') of Government Securities Income Fund is a 'unit
investment trust' 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, reference to the Trustee in the
Prospectus shall be deemed to refer to Investors Bank & Trust Company and The
First National Bank of Chicago, as 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 such reference. On the date of this Prospectus (the 'Initial Date of
Deposit') the Sponsors, acting as managers for the underwriters named under
Underwriting Account above, deposited the underlying Securities with the Trustee
at a price equal to the evaluation of the Securities on the offering side of the
market on that date as determined by the Evaluator, and the Trustee delivered to
the Sponsors units of interest ('Units') representing the entire ownership of
the Fund. Except as otherwise indicated under Portfolio (the 'Portfolio'), the
Securities so deposited were represented by purchase contracts assigned to the
Trustee together with an irrevocable letter or letters of credit issued by a
commercial bank or banks in the amount necessary to complete the purchase
thereof. 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' means the interest-bearing United
States Treasury obligations initially deposited in the Fund 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
Fund and described herein under Portfolio and any replacement and additional
obligations acquired and held by the Fund pursuant to the provisions of the
Indenture.

With the deposit of the Securities in the Fund on the Initial Date of
Deposit, the Sponsors established a proportionate relationship among the face
amounts of each Security in the Portfolio. Subsequent to the Initial Date of
Deposit, 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 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 Portfolio;
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.

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 the Units cannot be sold in
the over-the-counter market which the Sponsors propose to maintain at prices
determined in the same manner (see Market for Units). On the Initial Date of
Deposit each Unit represented the fractional undivided interest in the
Securities and net income of the Fund set forth under the Investment Summary in
the ratio of 1,000 Units for each approximately $1,000 face amount of Securities
initially deposited. Thereafter, if any Units are redeemed, the face amount of
Securities in the Fund will be reduced by amounts allocable to redeemed Units,
and the fractional undivided interest represented by each Unit in the balance
will be decreased. However, if additional Units are issued by the Fund (through
deposit of Securities by the Sponsors in connection with the sale of additional
Units), the aggregate value of Securities in the Fund will be increased by
amounts allocable to additional Units, and the fractional undivided interest
represented by each Unit in the balance will be increased. 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.)

1
<PAGE>
<PAGE>
RISK FACTORS

An investment in Units of the Fund should be made with an understanding of
the risks which an investment in fixed rate debt obligations may entail,
including the risk that the value of the Portfolio and hence of the Units will
decline with increases in interest rates. There have been recent 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.

The Fund may be an appropriate medium for U.S. investors who desire to
participate in a portfolio of taxable fixed income securities offering the
safety of capital provided by an investment backed by the full faith and credit
of the United States. In addition, many investors may benefit from the exemption
from state and local personal income taxes for Holders in all states (see Taxes
below).

SPECIAL FEATURES OF MARKET PREMIUM SECURITIES

Certain of the Securities in the Fund may have been valued at a market
premium. Securities trade at a premium because the interest rates on the
Securities are higher than interest on comparable debt securities being issued
at currently prevailing interest rates. If currently prevailing interest rates
for newly issued and otherwise comparable securities increase, the market
premium of previously issued securities will decline and if currently prevailing
interest rates for newly issued comparable securities decline, the market
premium of previously issued securities will increase, other things being equal.
The current returns of securities trading at a market premium are higher than
the current returns of comparably rated debt securities of a similar type issued
at currently prevailing interest rates because premium securities tend to
decrease in market value as they approach maturity when the face amount becomes
payable. Because part of the purchase price is thus returned not at maturity but
through current income payments, an early redemption of a premium security at
par will result in a reduction in yield. Market premium attributable to interest
rate changes does not indicate market confidence in the issue.

SPECIAL FEATURES OF MARKET DISCOUNT SECURITIES

Certain of the Securities in the Fund may have been valued at a market
discount. Securities trade at less than par value because the interest coupons
on these Securities are at lower rates than interest coupons of comparable debt
securities being issued at currently prevailing interest rates. The current
returns of securities trading at a market discount are lower than the current
returns of comparably rated debt securities of a similar type issued at
currently prevailing interest rates because discount securities tend to increase
in market value as they approach maturity and the full principal amount becomes
payable. If currently prevailing interest rates for newly issued and otherwise
comparable securities increase, the market discount of previously issued
securities will become deeper and if such currently prevailing interest rates
for newly issued comparable securities decline, the market discount of
previously issued securities will be reduced, other things being equal. Market
discount attributable to interest rate changes does not indicate a lack of
market confidence in the issue.

U.S. TREASURY SECURITIES

The U.S. Treasury obligations included in the Portfolio, though backed by
the full faith and credit of the United States, are subject to changes in market
value when interest rates fluctuate. It is anticipated that principal invested
will be returned at maturity of the last maturing Security listed under
Portfolio. The Portfolio contains information concerning the coupon rates and
maturities of the Securities in the Fund.

DESCRIPTION OF THE FUND

THE PORTFOLIO

The Portfolio initially consists of contracts to purchase U.S. Treasury
obligations fully secured by the full faith and credit of the United States,
certain of which may have been purchased at a market discount or premium.
Certain Securities may have been purchased on a when, as and if issued basis
(see the Investment Summary). Interest on these Securities begins accruing to
the benefit of Holders on their respective dates of delivery. Holders of Units
will be 'at risk' with respect to these Securities (i.e. may derive either gain
or loss from fluctuations in the offering side evaluation of the Securities)
from the date they commit for Units.

2
<PAGE>
<PAGE>

Experienced professional buyers and research analysts for Defined Asset
Funds, with access to thousands of different issues and extensive information,
who are in close contact with the markets for suitable securities, select
securities for deposit in the Fund considering the following factors, among
others: (i) the securities available; (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 or premium over par; and (iii) the
maturities of these securities.

The yield to maturity and the discount from par or premium over par on
securities of the type deposited in the Fund is dependent on a variety of
factors, including general money market conditions, general conditions of the
bond market and prevailing interest rates.

The Fund consists of the U.S. Treasury Securities (or contracts to purchase
the Securities) listed under Portfolio as may continue to be held from time to
time in the Fund (including any Replacement Securities and any Additional
Securities deposited in the Fund in connection with the sale of additional Units
to the public as described under Fund Structure above), together with the
accrued and undistributed interest thereon 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 fail ('Failed
Security'), including any Security purchased on a when, as and if issued basis,
the Sponsors are authorized under the Indenture to direct the Trustee to acquire
Replacement Securities substantially similar to those originally contracted for
and not delivered to make up the original Portfolio of the Fund (see
Administration of the Fund--Portfolio Supervision). If Replacement Securities
are not acquired, the Sponsors will, on or before the next following
Distribution Day, cause to be refunded the attributable sales charge, plus the
attributable Cost of Securities to Fund listed under Portfolio Securities, plus
interest attributable to the Failed Security. (See Administration of the
Fund--Portfolio Supervision).

The Indenture authorizes the Sponsors to increase the size and the number
of Units of the Fund by the deposit of Additional Securities and the issue of a
corresponding number of additional Units subsequent to the Initial Date of
Deposit provided that the original relationship among the face amounts of
Securities of specified interest rates and maturities is maintained to the
extent practicable. In addition, the Indenture authorizes the Sponsors to
reinvest the proceeds from maturing Securities into U.S. Treasury bills with
maturities identical to that of the last maturing Treasury Note listed under
Portfolio. At the time that the last maturing Treasury Note and the Treasury
bills mature, principal proceeds will be distributed to Holders. Also,
Securities may be sold under certain circumstances (see Redemption;
Administration of the Fund--Portfolio Supervision). Because the proceeds from
such events received by the Fund (less certain amount 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 principal amount of the Securities in
the Portfolio will vary over time.

Because each Defined Asset Fund is a defined portfolio of preselected
securities, purchasers know in advance what they are investing in. A defined
portfolio is listed, so that generally the securities and their maturities are
known before an investor buys. Of course, the portfolio will change somewhat
over time as additional securities are deposited, as securities mature or as
they are sold to meet redemptions and in the limited other circumstances
described below.

On the Initial Date of Deposit each Unit represented the fractional
undivided interest in the Fund set forth under the Investment Summary.
Thereafter, if any Units are redeemed by the Trustee the face amount of
Securities in the Fund 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 the Fund (through
deposit of Securities by the Sponsors in connection with the sale of additional
Units), the aggregate value of Securities in the Fund 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).

3
<PAGE>
<PAGE>
RATING OF UNITS

Standard & Poor's Corporation ('Standard & Poor's') has rated the Units of
the Fund 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 the Fund.

INCOME; ESTIMATED CURRENT RETURN; ESTIMATED LONG TERM RETURN

The estimated net annual interest rate per Unit on the business day prior
to the date of this Prospectus is set forth under the Investment Summary. This
rate shows the percentage return based on $1,000 face amount per 1,000 Units.
This rate will change as Securities are exchanged, redeemed, paid or sold, as
substitute or additional Securities are purchased and deposited in the Fund or
as the expenses of the Fund change.

In order to acquire certain of the Securities contracted for by the Fund,
it may be necessary to pay amounts covering accrued interest on the Securities
which exceed the amounts paid by Holders. The Trustee has agreed to pay for any
amounts necessary to cover this excess and will be reimbursed when funds become
available from interest payments on certain of the Securities. Should Securities
purchased on a when, as and if issued basis be issued later than the expected
date of issue but the contract for the purchase of these Securities be deemed
not to have failed, the Trustee will advance funds to the Fund in an amount
equal to the amount of interest whch would have accrued on these Securities
between the expected date of issue and the actual date of issue.

The accrued interest which is added to the Public Offering Price represents
the amount of net accrued and undistributed interest on the Securities from the
Initial Date of Deposit and, with respect to additional Securities deposited
following the Initial Date of Deposit, from the date these additional Securities
are deposited in the Fund to, but not including, the settlement date for Units.
However, Securities deposited in the Fund on the Initial Date of Deposit and
additional Securities deposited following the Initial Date of Deposit also
include an item of accrued but unpaid interest up to the date when the
Securities are deposited in the Fund. To avoid having Holders pay this
additional accrued interest (which earns no return) when they purchase Units,
the Trustee pays this amount of accrued interest. Thus, the Sponsors can sell
the Units at a price which includes interest only from the date when these
Securities are deposited in the Fund. The Trustee will recover the amount of
this distribution from interest received on the Securities deposited in the
Fund.

Interest on the Securities in the Fund, less estimated fees of the Trustee,
Sponsors and Evaluator and certain other expenses, is expected to accrue at the
daily rate (based on a 360-day year) shown the under the Investment Summary.
This rate will change as securities are exchanged, redeemed, paid or sold or as
additional Securities are purchased.

In addition to the Public Offering Price, the amount paid upon purchase of
a Unit may include accrued interest on the underlying Securities. Because of the
varying interest payment dates of the Securities comprising the Portfolio,
accrued interest at any time may be greater than the amount of interest actually
received by the Fund and distributed to Holders. Therefore, accrued interest is
normally added to the value of the Units. If a Holder sells all or a portion of
his Units, he will receive his proportionate share of any accrued interest from
the purchaser of his Units. Similarly, if a Holder redeems all or a portion of
his Units, the Redemption Price per Unit will also include accrued interest, if
any, on the Securities.

The Estimated Current Return and Estimated Long Term Return on the business
day prior to the date of this Prospectus are set forth under the Investment
Summary. Estimated Current Return on a Unit represents annual cash receipts from
coupon-bearing Treasury Notes listed under Portfolio (after estimated annual
expenses) divided by the Public Offering Price (including the sales charge.)
This calculation does not take into account the yields of the short-term
Treasury bills to be deposited in the Fund with the proceeds of the maturing
Treasury Notes.

Unlike Estimated Current Return, Estimated Long Term Return is a measure of
the estimated return to the investor earned over the estimated life of the Fund.
The Estimated Long Term Return represents an average of the yields to maturity
of the Treasury Notes listed under Portfolio, calculated in accordance with
accepted bond practice and adjusted to reflect expenses and sales 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

4
<PAGE>
<PAGE>

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 the Portfolio is derived by weighing the
yield of each Treasury Note listed under Portfolio 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 Portfolio yield is computed, this figure is then
adjusted for estimated expenses and the effect of the maximum sales charge paid
by investors. This calculation does not take into account the yields of the
short-term Treasury bills to be deposited in the Fund with the proceeds of the
maturing Treasury Notes. The Estimated Long Term Return calculation also does
not take into account the timing of receipts and distributions and may,
depending on maturities, over or understate the impact of sales charges. These
factors may result in a lower figure.

Both Estimated Current Return and Estimated Long Return are subject to
fluctuation with changes in Portfolio composition, changes in market value of
the underlying Securities and changes in fees and expenses, including sales
charges, and therefore can be materially different than the figure set forth
herein. The size of any difference between Estimated Current Return and
Estimated Long Term Return can also be expected to fluctuate at least as
frequently. In addition, both return figures may not be directly comparable to
yield figures used to measure other investments, and since the return figures
are based on certain assumptions and variables the actual return received by a
Holder may be higher or lower.

Sales charges on Defined Asset Funds range from under 1.0% to 5.5%. This
may be less than you might pay to buy a comparable mutual fund. Defined Funds
can be a cost-effective way to purchase and hold investments. Annual operating
expenses are generally lower than for managed funds. Because Defined Funds have
no management fees, limited transaction costs and no ongoing marketing expenses,
operating expenses are generally less than 0.25% per year. When compounded
annually, small differences in expense ratios can make a big difference in
earnings.

Record Days and Distribution Days are as set forth under the Investment
Summary.

YIELD COMPARISON OF FIVE-YEAR BANK CERTIFIATES OF DEPOSIT WITH THE FUND

<TABLE>
<S> <C>
Average Annual Estimated Long Term
Return as of Return as of
March 23, 1994 March 24, 1994
--------------- --------------------

5.75 %

4.66 %

CDs* The Fund
</TABLE>

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

*Source: Bank Rate Monitor

Currently, investors can earn more from the Fund than on an average
investment in five-year bank certificates of deposit ('CDs'). A higher yield and
defined advantages make this Fund an attractive alternative to CDs. Of course,
unlike CDs, the Fund is not FDIC-insured and its return and principal will vary.

FUND PERFORMANCE

Information on percentage changes in the value of Units, on the basis of
changes in Unit price plus the amount of interest and principal reinvested, may
be included from time to time in advertisements, sales literature, reports and
other information furnished to current or prospective Holders. Total return
figures are not averaged and may not reflect deduction of the sales charge,
which would decrease the yield. Average annualized return figures reflect
deduction of the maximum sales charges. No provision is made for any income
taxes payable.

5
<PAGE>
<PAGE>

Fund performance may be compared to performance data from publications such
as Donoghue's Money Fund Report, Lehman Brothers Intermediate Treasury Bond
Index, Lipper Analytical Services, Inc., Morningstar Publications, Inc., Money
Magazine, The New York Times, U.S. News and World Report, Business Week, CDA
Investment Technology, Inc., Forbes Magazine or Fortune Magazine. As with other
performance data, performance comparisons should not be considered
representative of the Fund's relative performance for any future period.

TAXES

TAXATION OF THE FUND

The Fund intends to qualify for and elect the special tax treatment
applicable to 'regulated investment companies' under Sections 851-855 of the
United States Internal Revenue Code of 1986, as amended (the 'Code').
Qualification and election as a 'regulated investment company' involve no
supervision of investment policy or management by any government agency. If the
Fund qualifies as a 'regulated investment company' and distributes to Holders
90% or more of its taxable income without regard to its net capital gain (net
capital gain is defined as the excess of net long-term capital gain over net
short-term capital loss), it will not be subject to Federal income tax on the
portion of its taxable income (including any net capital gain) distributed to
Holders in a timely manner. In addition, the Fund will not be subject to the 4%
excise tax on certain undistributed income of 'regulated investment companies'
to the extent it distributes to Holders in a timely manner at least 98% of its
taxable income (including any net capital gain). It is anticipated that the Fund
will not be subject to Federal income tax or the excise tax because the
Indenture requires the distribution of the Fund's taxable income (including any
net capital gain) in a timely manner. Although all or a portion of the Fund's
taxable income (including any net capital gain) for a taxable year may be
distributed shortly after the end of the calendar year, such a distribution will
be treated for Federal income tax purposes as having been received by Holders
during the calendar year.

DISTRIBUTIONS

Distributions to Holders of the Fund's interest income, gain that is
treated as ordinary income under the market discount rules, and any net
short-term capital gain in any year will be taxable as ordinary income to
Holders to the extent of the Fund's taxable income (without regard to its net
capital gain) for that year. Any excess will be treated as return of capital and
will reduce the Holder's basis in his Units and, to the extent that such
distributions exceed his basis, will be treated as a gain from the sale of his
Units as discussed below. It is anticipated that substantially all of the
distributions of the Fund's interest income, ordinary gain and any net
short-term capital gain will be taxable as ordinary income to Holders.

Distributions that are taxable as ordinary income to Holders will
constitute dividends for Federal income tax purposes but will not be eligible
for the dividends-received deduction for corporations. Distributions of the
Fund's net capital gain (designated as capital gain dividends by the Fund) will
be taxable to Holders as long-term capital gain, regardless of the time the
Units have been held by a Holder. A Holder may recognize taxable gain or loss if
the Holder sells or redeems his Units. Any gain or loss arising from (or treated
as arising from) the sale or redemption of Units will be capital gain or loss,
except in the case of a dealer in securities. Capital gains are currently 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.

Sales of Securities by the Fund (to meet redemptions or otherwise) may give
rise to gain (including market discount) to the Fund. The amount of gain will be
based upon the cost of the Security to the Fund and will be without regard to
the value of the Security when a particular Holder purchases his Units. Such
gain must be distributed to Holders to avoid Federal income (or excise) taxation
to the Fund. In the case of sales to meet redemptions, some or all of such gain
must be so distributed to nonredeeming Holders. Any such distribution will be
taxable to Holders as discussed above (i.e., as ordinary income or long-term
capital gain), even if as to a particular Holder the distribution economically
represents a return of capital. Since such distributions do not reduce a
Holder's tax basis in his Units, a Holder will have a corresponding capital loss
(or a reduced amount of gain) on a subsequent sale or redemption of his Units.

6
<PAGE>
<PAGE>

A Holder will recognize taxable gain or loss upon the redemption of his
Units, which will be capital gain or loss except in the case of a dealer in
securities. If a Holder requests a distribution in kind, the Holder will
recognize taxable gain or loss equal to the difference between such Holder's tax
basis in his Units and the amount of cash plus the fair market value of
Securities received in redemption. If a Holder requests a cash payment, the
Holder will recognize taxable gain or loss equal to the difference between such
Holder's tax basis in his Units and the amount of cash received. Holders should
consult their tax advisers in this regard.

The Federal tax status of each year's distributions will be reported to
Holders and to the Internal Revenue Service. The foregoing discussion relates to
the tax treatment of distributions by the Fund to U.S. Holders. Holders who are
not U.S. citizens or residents should be aware that distributions from the Fund
(other than distributions designated as capital gain dividends) generally will
be subject to a withholding tax of 30%, or a lower treaty rate, and should
consult their own tax advisors to determine whether investment in the Fund is
appropriate.

Holders will be taxed in the manner described above regardless of whether
such distributions from the Fund are actually received by the Holder or are
automatically reinvested into additional Units of the Fund pursuant to the
Reinvestment Plan.

The Sponsors believe that Holders who are individuals will not be subject
to any state personal income taxes on distributions of the Fund's interest
income. However, Holders (including individuals) may be subject to state taxes
on distributions by the Fund of income other than interest as well as capital
gains from the sale or redemption of Units of a Fund. Other state taxes
(including corporate income or franchise taxes, personal property or intangible
taxes and estate or inheritance taxes) may also be imposed on distributions of
income by the Fund or capital gains from the sale or redemption of Units of a
Fund. In addition, individual Holders (and any other Holders that are not
subject to state taxes on the interest income distributed by the Fund) may not
be entitled to a deduction for state tax purposes for any interest on
indebtedness incurred to purchase or carry their Units. Therefore, even though
the Sponsors believe that interest income distributed by the Fund is exempt from
state personal income taxes in all states, Holders should consult their own tax
advisers with respect to state taxation.

RETIREMENT PLANS

This Series of 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. 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 this Fund, and other financial institutions.
Fees and charges with respect to these plans may vary.

Retirement Plans for the Self-Employed--Keogh Plans. Units of the Fund 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 a qualified private or government 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), $40,000 (in the
case of
7
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<PAGE>
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 entitiled 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 employer 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 are 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 case of a 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 during the initial offering period
is computed by dividing the offer side evaluation of the Securities (as
determined by the Evaluator) by the number of Units outstanding and adding
thereto the sales charge in effect during the initial offering period at the
applicable percentage of the offer 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 in effect for the secondary market 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 Securities 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, where applicable, 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 500,000 Units 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. Sales charges and
dealer concessions are as follows:

INITIAL OFFERING PERIOD

<TABLE>
<CAPTION>
SALES CHARGE
(GROSS UNDERWRITING PROFIT)
<S> <C> <C> <C> <C>
------------------------------------
<CAPTION>
DEALER PRIMARY
CONCESSION MARKET
AS PERCENT OF AS PERCENT OF AS PERCENT OF CONCESSIONS
OFFER SIDE PUBLIC NET AMOUNT PUBLIC TO INTRODUCING
NUMBER OF UNITS OFFERING PRICE INVESTED OFFERING PRICE DEALERS
------------------ -------------- -------------- ---------------
<S> <C> <C> <C> <C>
Less than 500,000......................... 2.00% 2.041% 1.300% $ 14.40
500,000-999,999........................... 1.50 1.523 0.975 10.80
1,000,000 or more......................... 1.00 1.010 0.650 7.20
</TABLE>

8
<PAGE>
<PAGE>
SECONDARY MARKET SALES

<TABLE>
<CAPTION>
SALES CHARGE
(GROSS UNDERWRITING PROFIT)
<S> <C> <C> <C>
----------------------------------
<CAPTION>
DEALER
CONCESSION
AS PERCENT OF AS PERCENT OF AS PERCENT OF
BID SIDE PUBLIC NET AMOUNT PUBLIC
NUMBER OF UNITS OFFERING PRICE INVESTED OFFERING PRICE
---------------- -------------- --------------
<S> <C> <C> <C>

Less than 500,000....................................... 2.25% 2.302% 1.463%
500,000-999,999......................................... 1.75 1.781 1.138
1,000,000 or more....................................... 1.25 1.266 0.813
</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 which 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 1,000 Units.

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 in Part A, 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 Veterans Day.

COMPARISON OF PUBLIC OFFERING PRICE, SPONSORS' INITIAL REPURCHASE PRICE,
SECONDARY MARKET REPURCHASE PRICE AND REDEMPTION PRICE

On the business day prior to the Initial Date of Deposit the Public
Offering Price per Unit (which includes the sales charge) and the Sponsors'
Initial Repurchase Price per Unit (each based on the offer 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 the Investment Summary.

The initial Public Offering Price per Unit of the Fund and the Initial
Repurchase Price are based on the offer 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 Treasury obligations of the type
deposited in the Fund are expected to be approximately .10% lower than the offer
prices thereof. On the business day prior to the date of this Prospectus, the
bid side evaluation was lower than the offer side evaluation by the amount set
forth under Portfolio. 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

Units are easy to purchase. During the initial offering period Units will
be distributed to the public at the Public Offering Price through the
Underwriting Account set forth under Investment Summary 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.

9
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<PAGE>
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 applicable rate specified in the table above, but Merrill Lynch, Pierce,
Fenner & Smith Incorporated, as agent for the Sponsors ('Agent for the
Sponsors') reserves the right to change the rate of the concession to dealers
and the amount of 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, Underwriters named under Underwriting Account,
including the Sponsors, will receive sales charges at the rates set forth in the
tables above. The Sponsors also realize a profit or loss on deposit of the
Securities in the Fund in the amount set forth under the Investment Summary.
This is the difference between the cost of the Securities to the Fund (which is
based on the offer side evaluation of the Securities on the Initial Date of
Deposit) and the cost of the Securities to the Sponsors. On each subsequent
deposit of Securities with respect to the sale of additional Units to the
public, the Sponsors may 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 after the Date of Deposit in the
Public Offering Price of the Units (see Investment Summary). 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 and any offering of additional Units,
the Sponsors intend to offer to purchase Units of this Series at prices based
upon the offer 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 this Series and continuously to offer to purchase Units 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). This secondary market provides Holders with a fully
liquid investment. They can cash in Units at any time without a fee. The
Sponsors may discontinue purchases of Units of this Series at prices based on
the bid side evaluation of Securities should the supply of Units of this Series
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 Portfolio 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 shall be an amount not
less than the Redemption Price per Unit, based on the aggregate bid side
evaluation of the Securities 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 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
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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 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

The Trustee will effect all redemptions in kind, except that the Holder's
pro rata portion of the cash balance in the Fund will be paid in cash. 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, except that if the Sponsors are maintaining a secondary
market for Units at a price which will return to the Holder an amount in cash,
net after deducting any commissions or expenses, equal to or in excess of the
Redemption Price per Unit, the Trustee will deliver tendered Units for sale to
the Sponsors. The Trustee will 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. 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 Fund at the time of redemption. In an in kind
redemption the Holder will receive his pro rata portion of the principal amount
of the Portfolio and of the net cash in the Fund (Section 5.02).

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 interest in accordance with the foregoing and distribute net cash
proceeds to the tendering Holder together with whole Securities received on the
in kind distribution.

To the extent that securities are redeemed in kind, the size of the Fund
will be reduced but each remaining Unit will continue to represent the identical
principal amount of Securities with specified interest rates, maturities and
call provisions, if any.

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 (Section 5.02).

COMPUTATION OF REDEMPTION PRICE PER UNIT

Redemption Price per Unit 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 for redemption, and on any other business day desired by the Trustee or the
Sponsors, by adding (a) the aggregate bid side evaluation of the Securities, (b)
cash on hand in the Fund (other than cash covering contracts to purchase
Securities or credited to a reserve account), (c) accrued but unpaid interest on
the Securities up to but not including the date of redemption and (d) the
aggregate value of all other assets of the Fund; deducting therefrom the sum of
(v) taxes or other governmental charges against the Fund not previously
deducted, (w) accrued but unpaid expenses of the Trust (x) amounts payable for
reimbursement of Trustee advances, (y) cash held for redemption of units for
distribution to Holders of record as of a date prior to the evaluation and (z)
the aggregate value of all other liabilities of the Trust; and dividing the
result by the number of Units outstanding as of the date of computation
(Sections 4.01 and 5.01).

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The aggregate current bid or offer price evaluation of the Securities is
determined by the Evaluator in the following manner: (a) on the basis of current
bid or offer prices for the Securities, (b) if bid or offer prices are not
available for any Securities, on the basis of current bid or offer prices for
comparable securities, (c) by determining the value of the Securities on the bid
or offer 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.

While Securities of the type included in the Portfolio 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 the Fund.

EXPENSES AND CHARGES

INITIAL EXPENSES

All expenses incurred in establishing the Fund, including the cost of the
initial preparation and printing of documents relating to the Fund, cost of the
initial evaluation, the initial fees and expenses of the Trustee, legal
expenses, advertising and selling expenses and any other out-of-pocket expenses,
will be paid by the Underwriting Account at no charge to the Fund.

FEES

An estimate of the total annual expenses of the Fund is set forth under the
Investment Summary. The Portfolio Supervision fee is based on the average of the
largest face amount of Securities in the Fund during each month of a calendar
year in which additional Securities are deposited and thereafter, on the largest
face amount of Securities in the Fund at any time during the year. This fee,
which is not to exceed the maximum amount set forth under the Investment
Summary, may exceed the actual costs of providing portfolio supervisory services
for this Fund, but at no time will the total amount they receive for supervisory
services rendered to all series of Government Securities Income Fund in any
calendar year exceed the aggregate cost to them of supplying these services in
that year (Section 7.06). In addition, the Sponsors may also be reimbursed for
bookkeeping or other administrative services provided to the Fund in amounts not
exceeding their costs of providing these services (Sections 3.04, 7.06). The
Trustee (or Co-Trustees, in the case of Investors Bank & Trust Company and The
First National Bank of Chicago) receives for its services as Trustee and for
reimbursement of expenses incurred on behalf of the Fund, payable in monthly
installments, the amount per 1,000 Units set forth under the Investment Summary
as Trustee's Annual Fee and Expenses, which includes the Evaluator's Fee, the
estimated Portfolio Supervision Fee, estimated reimbursable bookkeeping or other
adminstrative expenses paid to the Sponsors and certain mailing and printing
expenses. Expenses in excess of this amount will be borne by the Fund. A portion
of the Trustee's Expenses represents compensation for amounts advanced or to be
advanced to the Fund by the Trustee in order to make certain distributions to
Holders required by the United States Internal Revenue Service Code of 1986, as
amended, in excess of cash available for that purpose (see Administration of the
Fund--Accounts and Distributions). The amount of these expenses per Unit will be
determined one business day prior to the Initial Date of Deposit and will depend
on the size of the Fund and interest rates then in effect. 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 (Sections 3.04, 4.03 and 8.05).

OTHER CHARGES

Other charges include: (a) fees of the Trustee and the Distribution Agent
for extraordinary services (Section 8.05), (b) certain expenses of the Trustee
(including legal and auditing expenses) and of counsel designated by the
Sponsors (Sections 3.04, 3.09, 8.01(e), 8.03 and 8.05), (c) various governmental
charges (Sections 3.03 and 8.01(h)), (d) expenses and costs of any action taken
to protect the Fund (Section 8.01(d)), (e) indemnification of the Trustee and
the Distribution Agent for any losses, liabilities and expenses incurred without
gross negligence, bad faith or willful misconduct on its part (Section 8.05),
(f) indemnification of the Sponsors for any losses, liabilities and expenses
incurred without gross negligence, bad faith, wilful misconduct or reckless
disregard of their duties (Section 7.05(b)) and (g) expenditures incurred in
contacting Holders upon termination of the Fund (Section 9.02). The amounts of
these charges and fees are secured by a lien on the Fund and, if the balances in
the Income and Capital Accounts (see below) are insufficient to
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provide for amounts payable by the Fund, the Trustee has the power to sell
Securities to pay such amounts (Section 8.05).

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 the Fund,
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 (Sections 6.01, 8.02 and 8.04).

ACCOUNTS AND DISTRIBUTIONS

Interest received is credited to an Income Account and other receipts to a
Capital Account (Sections 3.01 and 3.02). Monthly Income 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 Account
computed as of the close of business on the preceding Record Day. No
distributions, except for capital gains distributions, will be made from the
Capital Account until the maturity of the last maturing Security listed under
Portfolio, at which time the Trustee will distribute the Holder's pro rata share
of the distributable cash balance of the Capital Account. 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. A
Reserve Account may be created by the Trustee by withdrawing from the Income or
Capital Accounts, from time to time, amounts deemed necessary to reserve for any
material amount that may be payable out of the Fund (Section 3.03). Funds held
by the Trustee in the various accounts created under the Indenture do not bear
interest (Section 8.01).

REINVESTMENT PLAN

Monthly Income Distributions and annual distributions of any capital gain
net income (i.e., the excess of capital gains over capital losses) in respect of
the Units may be reinvested by participating in the Fund's reinvestment plan
(the 'Reinvestment Plan'). A Holder (including any Holder which is a broker or
nominee of a bank or other financial institution) may indicate to the Trustee,
by filing the written notice of election accompanying this Prospectus or by
notice to the Holder's account executive or sales representative, that he wishes
such income distributions to be automatically invested in additional Units (or
fractions thereof) of the Fund. The Holder's completed notice of election to
participate in the Reinvestment Plan must be received by the Trustee at least
ten days prior to the Record Date applicable to any distribution in order for
the Reinvestment Plan to be in effect as to such distribution and will remain
effective until notice of the contrary is timely received by the Trustee.

Deposits of additional Securities in connection with the Reinvestment Plan
will be made so as to maintain, as closely as practicable, the proportionate
relationship (subject to adjustment under certain circumstances) among the
maturities of each Security in the Fund (see Administration of the
Fund--Portfolio Supervision).

Purchases made pursuant to the Reinvestment Plan will be at the applicable
Public Offering Price for Units of the Fund, at no sales charge, on (or as soon
as possible after) the close of business on the Distribution Day. Under the
Reinvestment Plan, the Fund will pay the distributions to the Trustee which in
turn will purchase for the Holder full and fractional Units of the Fund at the
price and time indicated above, will add the Units to the Holder's account, and
will send the Holder an account statement reflecting the reinvestment. These
Units may be Units already held in inventory by the Sponsors (see Market for
Units) or new Units created by the Sponsors' deposit of additional Securities,
contracts to purchase additional Securities, or cash (or a bank letter of
credit) with instructions to purchase additional Securities (see Description of
the Fund--The Portfolio).

The Trustee will issue Certificates for whole units purchased through the
Reinvestment Plan only if the Holder so requests in writing. Certificates will
not be issued for fractional units. When Certificates are not issued the Trustee
will credit each Holder's account with the number of units purchased with such
Holder's reinvested distribution. Each Holder receives account statements both
annually and after each Reinvestment Plan transaction to provide the Holder with
a record of the total number of units in his account. This

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relieves the Holder of responsibility for safekeeping of Certificates and,
should he sell his units, eliminates the need to deliver Certificates. The
Holder may at any time request the Trustee (at the Fund's cost) to issue
Certificates for full units. The cost of administering the Reinvestment Plan
will be borne by the Fund and thus will be borne indirectly by all Holders.

Holders of Units held in 'street name' by their broker or dealer should
contact their account executive or sales representative to determine whether or
not participation in the Reinvestment Plan through that broker or dealer is
available. Holders of Units participating in the Reinvestment Plan through their
broker or dealer will receive confirmation of their reinvestments in their
regular account statements or on a quarterly basis.

Holders participating in the Reinvestment Plan will be taxed on their
distributions in the manner described under Taxes even though these
distributions are automatically reinvested in the Fund.

At the time the Sponsors cease to deposit additional securities in the Fund
and cease to offer additional Units to the public, additional Units will no
longer be available for purchase for the Reinvestment Plan. Therefore, after
that time, all Holders including those who participate in the Reinvestment Plan,
will receive all distributions in cash unless the Sponsors provide another
reinvestment alternative at that time. The Reinvestment Plan may be modified or
cancelled at the discretion of the Sponsors. Participants in the Reinvestment
Plan will be notified of any modification or cancellation of the plan.

Holders of Units in IRA's, Keogh plans, and other tax-deferred retirement
plans should consult with their plan custodian as to the appropriate
dispositions of distributions (see Taxes--Retirement Plans).

PORTFOLIO SUPERVISION

The Fund is a unit investment trust which normally follows a buy and hold
investment strategy and is not actively managed. Traditional methods of
investment management for a managed fund (such as a mutual fund) typically
involve frequent changes in a portfolio of securities on the basis of economic,
financial and market analyses. The Portfolio of this Series, 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 the Portfolio.
Defined Asset Funds investment professionals are dedicated exclusively to
selecting and then monitoring securities held by the various Defined Funds. On
an ongoing basis 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 guarantor, (v) 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 redemption dates), that in
the opinion of the Sponsors would make the retention of the Security detrimental
to the interests of the Holders, (vi) if a Security is not consistent with the
investment objective of the Fund or (vii) if the Trustee has a right to sell or
redeem a Security pursuant to any applicable guarantee or other credit support.
If a default in the payment of amounts due on any Security occurs and if the
Agent for the Sponsors fails to give instructions to sell or hold the Security,
the Indenture provides that the Trustee, within 30 days of the failure, shall
sell the Security (Section 3.08).

The Sponsors are authorized to direct the Trustee to deposit replacement
securities ('Replacement Securities') into the Portfolio to replace any Failed
Securities 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 Securities initially deposited will be deposited into a
Trust within 110 days of the Initial Date of Deposit of the contracts that have
failed at a purchase price that may not exceed the amount of funds reserved for
the purchase of Failed Securities and that results in a yield to maturity as of
that date of deposit, that is substantially equivalent (taking into
consideration then current market conditions and the relative creditworthiness
of the underlying obligation) to the yield to maturity of the Failed Securities.
The Replacement Securities shall (i) be Securities issued by the U.S. Treasury;
(ii) have a fixed maturity date substantially identical to that of the Failed
Securities; (iii) not cause the Fund to cease to be rated in the category AAA by
Standard & Poor's; and (iv) not be when, as and if issued obligations. The
Indenture also requires that the purchase of Replacement Securities not cause
the Fund to fail to qualify as a 'regulated

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investment company' under the Code. Whenever a Replacement Security has been
acquired, the Trustee shall, on the next Distribution Day that is more than 30
days thereafter, make a pro rata distribution of the amount, if any, by which
the cost to the Fund of the Failed Security exceeded the cost of the Replacement
Security plus any accrued interest. If Replacement Securities are not acquired,
the Sponsors will, on or before the next following Distribution Day, cause to be
refunded to Holders the attributable sales charge, plus the attributable Cost of
Securities to Fund listed under Portfolio, plus interest attributable to the
relevant Security. In addition, the Sponsors are authorized to direct the
Trustee to reinvest the proceeds of each maturing Treasury Note into a
short-term Treasury bill that will mature on the same date as the last maturing
Treasury Note in the Fund.

The Indenture also authorizes the Sponsors to increase the size and number
of Units of the Fund 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, provided that the original proportionate relationship among
the face amounts of each Security established on the Initial Date of Deposit
(the 'Original Proportionate Relationship') is maintained to the extent
practicable.

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 subsequent to 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 the Fund 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) (i) Securities of another issue originally
deposited or (ii) a Replacement Security which will meet the conditions
described above.

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. After the end of each calendar year
during which a Monthly Income Distribution was made to Holders, 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 and the number of Units outstanding at the
end of that calendar 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 (Section 3.06). The accounts of the Fund shall be audited at least
annually by independent certified public accountants designated by the Sponsors
and the report of the accountants shall be furnished by the Trustee to Holders
upon request (Section 8.01(h)).

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 (Section 4.02).

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
(Section 6.01) 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 (Section 6.02).

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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. A Holder may at any time request the
Trustee (at the Fund's cost) to issue Certificates for Units.

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 then outstanding, provided that no such amendment or waiver will
reduce the interest in the Fund 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 (Section 10.01).

The Indenture will terminate 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 the Investment
Summary. The Indenture may be terminated by the Sponsors if the value of the
Fund is less than the minimum value set forth under the 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 (Sections 8.01(g) and 9.01). The
Trustee will deliver written notice of any termination to each Holder within a
reasonable period of time prior to such termination, specifying the times at
which the Holders may surrender their Certificates for cancellation. Within a
reasonable period of time after such termination, the Trustee must sell all of
the Securities then held and distribute to each Holder, upon surrender for
cancellation of his 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 (Section 9.01). 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 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 the 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
(Section 8.06(b)). 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 under the Indenture. 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 (Sections 8.01 and 8.05).

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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 (Section 4.04). 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
(Section 4.03). 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.

THE SPONSORS

Any Sponsor may resign if one remaining Sponsor maintains a net worth of
$2,000,000 and is agreeable to such resignation (Section 7.04). 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 (Section 8.01(e)). Merrill Lynch has been appointed by
the other Sponsors as agent for purposes of taking action under the Indenture
(Section 7.01). 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 shall continue
to act as sole Sponsor (Section 7.02(b)). 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 sole Sponsors (Section 7.02(a)).
The Sponsors shall be under no liability to the Fund 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
(Section 7.03).

MISCELLANEOUS

TRUSTEE

The Trustee of the Fund is named on the back cover page of this Prospectus
and is either 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, the
Federal Deposit Insurance Corporation and the Board of Governors of the Federal
Reserve System); Bankers Trust Company, a New York banking corporation with its
corporate trust office at Four Albany Street, 7th Floor, New York, New York
10015 (which is subject to supervision by the New York Superintendent of Banks,
the Federal Deposit Insurance Corporation and the Board of Governors of the
Federal Reserve System); The Chase Manhattan Bank, N.A., a national banking
association with its Unit Trust Department at 1 Chase Manhattan Plaza--3B, New
York, New York 10005 (which is subject to supervision by the Comptroller of the
Currency, the Federal Deposit Insurance Corporation and the Board of Governors
of the Federal Reserve System) or (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 and the Board of Governors of 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
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Comptroller of the Currency, the Federal Deposit Insurance Corporation and the
Board of Governors of 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 The First National Bank of Chicago and Investors Bank
& Trust Company, 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 Portfolio of the Fund, included
herein has been audited by Deloitte & Touche, independent accountants, as stated
in their opinion appearing herein, and has been included in reliance upon that
opinion given on the authority of that firm as experts in accounting and
auditing.