<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 1, 1994
REGISTRATION NO. 33-55247
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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-21
(LADDERED MATURITIES)
DEFINED ASSET FUNDS
B. NAMES OF DEPOSITORS:
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
SMITH BARNEY 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 INC.
SMITH INCORPORATED TWO WORLD TRADE CENTER
UNIT INVESTMENT TRUST DIVISION 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. DOUGLAS LOWE, ESQ. 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 November 1, 1994 pursuant to Rule 487.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<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 and investment flexibility through an investment
Securities in a portfolio of interest-bearing U.S. Treasury
Income Fund obligations that are backed by the
full faith and credit of the United States Government.
'Laddered' maturities of approximately six to ten years
will periodically return to Holders approximately 20% of
principal invested. Interest income is exempt from state
and local
personal income taxes in all states. The value of Units
of the Fund will fluctuate with the value of the
Portfolio of underlying
- --------------------
MONTHLY PAYMENT
U.S. TREASURY
SERIES-21 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
(LADDERED sales charge and is computed by multiplying the estimated
MATURITIES) net annual interest rate per Unit by $1,000 and dividing
A UNIT INVESTMENT the result by the Public Offering Price per 1,000 Units
TRUST (including the sales charge but
6.99%
ESTIMATED CURRENT
RETURN
AS OF OCTOBER 31,
1994 not including accrued interest).
Estimated Long Term Return shows a net annual long-term
return to investors holding to maturity based on the
yield on the individual bonds in the Portfolio, weighted
to reflect the time to maturity and market value of each
bond in the Portfolio,
adjusted to reflect the Public Offering Price (including
7.39% the sales charge) and estimated expenses. Unlike
ESTIMATED LONG TERM Estimated Current Return, Estimated Long Term Return
RETURN takes into account maturities of the underlying
AS OF OCTOBER 31, Securities and discounts and premiums. Distributions of
1994 income on Units are generally
subject to certain delays; if the Estimated Long Term
Return figure shown above took these delays into account,
/ /U.S. GOVERNMENT it would be lower. Both Estimated Current Return and
SECURITIES Estimated Long Term
Return are subject to fluctuations with changes in
/ /MONTHLY INCOME Portfolio
composition, changes in the market value of the
underlying Securities and changes in fees and expenses.
Estimated cash flows to Holders are set forth in the
/ /AAA RATED Prospectus.
Minimum purchase in individual transactions: 250 Units.
U.S. TAX EXEMPT FOR
FOREIGN
INVESTORS WHEN
CERTAIN
CONDITIONS ARE MET
</TABLE>
<TABLE>
<S> <C>
Merrill Lynch, THESE SECURITIES HAVE NOT BEEN APPROVED OR
Pierce Fenner & DISAPPROVED BY THE SECURITIES AND EXCHANGE
Smith Inc. COMMISSION OR ANY STATE SECURITIES COMMISSION
Smith Barney 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 1-800-323-1508.
Dean Witter Reynolds Prospectus dated November 1, 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.
- ------------------------------------------------------------------------------
Contents
<TABLE>
<S> <C>
Investment Summary..................................... A-3
Fee Table.............................................. A-4
Underwriting Account................................... A-8
Report of Independent Accountants...................... A-9
Statement of Condition................................. A-9
Portfolio.............................................. A-10
Estimated Cash Flow to Holders......................... A-11
Fund Structure......................................... 1
Risk Factors........................................... 2
Description of the Fund................................ 2
Taxes.................................................. 5
Public Sale of Units................................... 8
Market for Units....................................... 10
Redemption............................................. 10
Expenses and Charges................................... 12
Administration of the Fund............................. 12
Resignation, Removal and Limitations on Liability...... 15
Miscellaneous.......................................... 16
Description of Ratings................................. 19
</TABLE>
A-2
<PAGE>
<PAGE>
INVESTMENT SUMMARY AS OF OCTOBER 31, 1994 (THE BUSINESS DAY PRIOR TO THE INITIAL
DATE OF DEPOSIT)( a )
<TABLE>
<S> <C>
ESTIMATED CURRENT RETURN( b )
(based on Public Offering Price) 6.99%
ESTIMATED LONG TERM RETURN( b )
(based on Public Offering Price) 7.39%
PUBLIC OFFERING PRICE PER
1,000 UNITS (including 2.00%
sales charge) $ 982.88( c )
FACE AMOUNT OF SECURITIES-- $ 500,000
INITIAL NUMBER OF UNITS( d )-- 500,000
SPONSORS' REPURCHASE PRICE AND
REDEMPTION PRICE PER 1,000
UNITS( e )
(based on bid side evaluation) $ 962.60( c )
REDEMPTION PRICE PER 1,000 UNITS
LESS THAN:
Public Offering Price by...... $ 20.28
Sponsors' Initial Repurchase
Price by................... $ .62
FRACTIONAL UNDIVIDED INTEREST IN
FUND REPRESENTED BY EACH UNIT-- 1/500,000TH
CALCULATION OF PUBLIC OFFERING
PRICE
Aggregate offer side
evaluation of Securities in
Fund....................... $ 481,609.00
--------------
Divided by Initial Number of
Units times 1,000.......... $ 963.22
Plus sales charge of 2.00% of
Public Offering Price
(2.041% of net amount
invested in
Securities)( f )........... 19.66
--------------
Public Offering Price per
1,000 Units................ $ 982.88
Plus accrued interest per
1,000 Units( g )........... 1.33
--------------
Total per 1,000 Units...... $ 984.21
--------------
--------------
</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............................ 6.975%
Less estimated annual expenses per
1,000 Units ($1.09) expressed as
a percentage..................... .109%
---------
Estimated net annual interest rate
per 1,000 Units( h )............. 6.866%
---------
---------
DAILY RATE AT WHICH ESTIMATED NET
INTEREST ACCRUES PER 1,000 UNITS....... .0190%
</TABLE>
<TABLE>
<S> <C>
MONTHLY INCOME DISTRIBUTIONS PER 1,000 UNITS
First distribution to be paid on
February 25, 1995 to Holders of
record on February 10, 1995...... $ 5.22
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........................ $ 68.66
Divided by 12....................... $ 5.72
CAPITAL ACCOUNT DISTRIBUTIONS
Distributions from the Capital Account will be made
on or about the second business day following
the maturity of each Security to Holders of
record on the business day immediately preceding
the date of the distribution.
MINIMUM CAPITAL DISTRIBUTION
No distribution need be made from Capital Account
if balance is less than $5.00 per 1,000 Units
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-- 100%
</TABLE>
<TABLE>
<S> <C>
SPONSORS' PROFIT (LOSS) ON DEPOSIT $ 608.99
TRUSTEE'S ANNUAL FEE AND EXPENSES( i )
$1.09 per 1,000 Units (see Expenses and Charges)
PORTFOLIO SUPERVISION FEE( j )
Maximum of $0.25 per $1,000 face amount of
underlying Securities (see Expenses and Charges)
EVALUATOR'S FEE FOR EACH EVALUATION
Minimum of $5.00 (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>
- ------------
(a) The Indenture was signed and the initial deposit was made on the
date of this Prospectus.
(b) 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
but not for delays in the Fund's distribution of income. Estimated Current
Return shows current annual cash return to investors 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.
(c) Plus accrued interest.
(d) The Sponsors may create additional Units during the offering period
of the Fund.
(e) 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.)
( f ) 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.
( g ) 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 Current Return; Estimated Long
Term Return).
(h) Assumes the Fund will reach a size estimated by the Sponsors.
Expenses will vary with the size of the Fund relative to this estimate.
(i) 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.
(j) In addition to this amount, the Sponsors may be reimbursed for
bookkeeping or other administrative expenses not exceeding their actual costs,
currently at a maximum annual rate of $.10 per 1,000 Units.
A-3
<PAGE>
<PAGE>
INVESTMENT SUMMARY AS OF OCTOBER 31, 1994 (CONTINUED)
FEE TABLE
THIS FEE TABLE IS INTENDED TO ASSIST INVESTORS IN UNDERSTANDING THE COSTS AND
EXPENSES THAT AN INVESTOR IN THE FUND WILL BEAR DIRECTLY OR INDIRECTLY. SEE
PUBLIC SALE OF UNITS AND EXPENSES AND CHARGES. ALTHOUGH THE FUND IS A UNIT
INVESTMENT TRUST RATHER THAN A MUTUAL FUND, THIS INFORMATION IS PRESENTED TO
PERMIT A COMPARISON OF FEES.
<TABLE>
<S> <C>
UNITHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases during the Initial Offering Period (as a percentage
of Public Offering Price)...................................................................... 2.00%
Maximum Sales Charge Imposed on Purchases during the Secondary Offering Period (as a percentage
of Public Offering Price)...................................................................... 2.25%
ESTIMATED ANNUAL FUND OPERATING EXPENSES
(AS A PERCENTAGE OF AVERAGE NET ASSETS1)
Trustee's Fee.................................................................................. .062%
Portfolio Supervision, Bookkeeping and Administrative Fees..................................... .026%
Other Operating Expenses....................................................................... .025%
------
Total....................................................................................... .113%
------
------
</TABLE>
- ------------------
1Based on the mean of the bid and the offer side evaluations; this figure may
differ from that set forth as estimated annual expenses per 1,000 Units
expressed as a percentage on page A-3.
<TABLE>
<S> <C> <C> <C> <C>
EXAMPLE CUMULATIVE EXPENSES PAID FOR PERIOD OF:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
An investor would pay the following expenses on a $1,000
investment, assuming the Fund's estimated operating expense
ratio of .113% and a 5% annual return on the investment
throughout the periods.......................................... $21 $24 $26 $34
</TABLE>
The Example assumes reinvestment of all distributions into additional Units
of the Fund (a reinvestment option different from that offered by this Fund--see
Administration of the Fund--Investment Accumulation Program) and utilizes a 5%
annual rate of return as mandated by Securities and Exchange Commission
regulations applicable to mutual funds. In addition to the charges described
above, a Holder selling or redeeming his Units in the secondary market (before
the Fund terminates) will receive a price based on the then-current bid side
evaluation of the underlying securities. The difference between this bid side
evaluation and the offering side evaluation (the basis for the Public Offering
Price), as of the day before the Initial Date of Deposit is $.61 per 1,000
Units. Of course, this difference may change over time. The Example should not
be considered a representation of past or future expenses or annual rate of
return; the actual expenses and annual rate of return may be more or less than
those assumed for purposes of the Example.
A-4
<PAGE>
<PAGE>
Defined
Asset Funds
Defined
Government
Securities
Income
Fund
Investor's Guide
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 Credit Safety of U.S. Treasury Securities
The U.S. Government is obligated to the holders of these
Government securities, such as the Fund, to pay every penny of
Securities interest and principal due to them. The Fund itself is
Income Fund 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.
Investment Flexibility
- -------------------- By utilizing an investment strategy called laddering, the
Fund seeks to provide protection against changes in
interest rates.
MONTHLY PAYMENT Each year beginning in 2000, approximately 20% of
U.S. TREASURY principal is returned as securities mature. This way, a
SERIES-21 portion of your investment will continue to earn higher
(LADDERED levels of income if interest rates decline; a portion of
MATURITIES) your investment will be available each year to be
reinvested at higher rates if interest rates rise.
Monthly Income Distributions
Although the bonds themselves pay semiannually, the Fund
will distribute income monthly. Principal from sales,
redemptions and maturities of bonds is distributed as it
is received. Interest payments, of course, decrease as
principal is returned.
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 the
Fund's Units.
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.
State and Local Tax Exempt
Income from the Fund is exempt from state and local
personal income taxes in all states just as though you
owned the Treasury Securities directly. Depending on
where you live, these exemptions could be very important
and could increase the after-tax return you receive.
This page may not be distributed unless included in a current prospectus.
Investors should refer to the Prospectus for further information.
<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 6.99% Estimated Current
Return and 7.39% 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 6.99% EQUIVALENT TO 7.39%
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>
- ---------------------------------------------------------------------------------- ------------------------------------
Alabama 5.000%(b) 7.36% 7.78% Nebraska 6.990%
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Alaska 0.000 6.99 7.39 Nevada 0.000
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Arizona 6.900(b) 7.51 7.94 New Hampshire 5.000
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Arkansas 7.000 7.52 7.95 New Jersey 6.650
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
California 11.000 7.85 8.30 New Mexico 8.500
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Colorado 5.000 7.36 7.78 New York 7.875
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Connecticut 4.500 7.32 7.74 North Carolina 7.750
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Delaware 7.700 7.57 8.01 North Dakota 12.000(g)
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Florida 0.000 6.99 7.39 Ohio 7.500
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Georgia 6.000 7.44 7.86 Oklahoma 10.000(b)(d)
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Hawaii 10.000 7.77 8.21 Oregon 9.000(b)
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Idaho 8.200 7.61 8.05 Pennsylvania 2.800
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Illinois 3.000 7.21 7.62 Puerto Rico 36.000(h)
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Indiana 3.400 7.24 7.65 Rhode Island 10.890(e)
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Iowa 9.980(b) 7.76 8.21 South Carolina 7.000
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Kansas 7.750 7.58 8.01 South Dakota 0.000
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Kentucky 6.000 7.44 7.86 Tennessee 6.000
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Louisiana 6.000 7.44 7.86 Texas 0.000
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Maine 8.500 7.64 8.08 Utah 7.200(c)
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Maryland 6.000 7.44 7.86 Vermont 9.900(e)(f)
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Massachusetts 12.000 7.94 8.40 Virginia 5.750
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Michigan 4.400 7.31 7.73 Washington 0.000
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Minnesota 8.500 7.64 8.08 West Virginia 6.500
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Mississippi 5.000 7.36 7.78 Wisconsin 6.930
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Missouri 6.000 7.44 7.86 Wyoming 0.000
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C>
Montana 11.000 7.85 8.30 Dist. of Columbia 9.500
<CAPTION>
- ---------------------------------------------------------------------------------- ------------------------------------
<CAPTION>
FULLY TAXABLE RETURN FULLY TAXABLE RETURN
EQUIVALENT TO 6.99% EQUIVALENT TO 7.39%
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 7.52 % 7.95 %
- --------------
<S> <C> <C>
Alaska 6.99 7.39
- --------------
<S> <C> <C>
Arizona 7.36 7.78
- --------------
<S> <C> <C>
Arkansas 7.49 7.92
- --------------
<S> <C> <C>
California 7.64 8.08
- --------------
<S> <C> <C>
Colorado 7.59 8.02
- --------------
<S> <C> <C>
Connecticut 7.58 8.01
- --------------
<S> <C> <C>
Delaware 7.94 8.40
- --------------
<S> <C> <C>
Florida 7.56 7.99
- --------------
<S> <C> <C>
Georgia 7.77 8.21
- --------------
<S> <C> <C>
Hawaii 7.68 8.12
- --------------
<S> <C> <C>
Idaho 7.19 7.60
- --------------
<S> <C> <C>
Illinois 10.92 11.55
- --------------
<S> <C> <C>
Indiana 7.84 8.29
- --------------
<S> <C> <C>
Iowa 7.52 7.95
- --------------
<S> <C> <C>
Kansas 6.99 7.39
- --------------
<S> <C> <C>
Kentucky 7.44 7.86
- --------------
<S> <C> <C>
Louisiana 6.99 7.39
- --------------
<S> <C> <C>
Maine 7.53 7.96
- --------------
<S> <C> <C>
Maryland 7.76 8.20
- --------------
<S> <C> <C>
Massachusetts 7.42 7.84
- --------------
<S> <C> <C>
Michigan 6.99 7.39
- --------------
<S> <C> <C>
Minnesota 7.48 7.90
- --------------
<S> <C> <C>
Mississippi 7.51 7.94
- --------------
<S> <C> <C>
Missouri 6.99 7.39
- --------------
<S> <C> <C>
Montana 7.72 8.17
- --------------
</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 1,000,000 2.00% 6.99% 7.39%
<CAPTION>
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C>
1,000,000 or more 1.00% 7.06% 7.47%
</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 1,000,000 2.25% 6.97% 7.39%
<CAPTION>
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C>
1,000,000 or more 1.25% 7.04% 7.47%
</TABLE>
A-6
<PAGE>
<PAGE>
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 1/15/00
to 8/15/04.
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 investment
flexibility as well as current monthly income distributions through investment
in a fixed, laddered portfolio initially consisting of contracts to purchase
interest-bearing U.S. Treasury obligations (the 'Securities') with maturities of
approximately six to ten years. The Fund seeks to protect against declining
interest rates by investing a portion of the Portfolio in longer-term
Securities, while if interest rates rise Holders will be able to reinvest the
proceeds of principal returned each year in higher yielding obligations. It is
anticipated that 20% of principal invested will be returned as each issue of
Securities matures. At that time Holders may choose to reinvest the proceeds of
the return of principal in a new Series of the Fund, if one is offered by the
Sponsors, or to pursue some other investment option. The Securities were issued
after July 18, 1984, are direct obligations of the United States and are backed
by its full faith and credit. The Fund is formed for the purpose of providing
protection against changes in interest rates and also passing through to Holders
in all states the exemption from state and local personal income taxes afforded
to direct owners of U.S. obligations, as well as providing an exemption from
U.S. Federal income taxes, including withholding taxes, for many foreign Holders
(see Taxation on page A-8 and Taxes).
FUND PORTFOLIO--5 different issues of short intermediate-term U.S. Treasury
obligations. The percentage relationships on the Initial Date of Deposit are as
follows: 6.375% coupons maturing 1/15/00, 20%; 7.500% coupons maturing 11/15/01,
20%; 7.500% coupons maturing 5/15/02, 20%; 6.250% coupons maturing 2/15/03, 20%;
7.250% coupons maturing 8/15/04, 20%.
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 250 Units. There is no minimum purchase for payroll deduction
plans.
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-7
<PAGE>
<PAGE>
INVESTMENT SUMMARY AS OF OCTOBER 31, 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 each Security in the Fund matures. (See Administration of the
Fund--Accounts and Distributions). At that time, Holders may elect to reinvest
their proceeds in a new Series of the Fund, if one is offered by the Sponsors.
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 long-term return to
investors holding to maturity based on the yield on the individual Securities in
the Portfolio weighted to reflect the time to maturity and market value of each
Security in the Portfolio, adjusted to reflect the Public Offering Price
(including the maximum applicable sales charge of 2.00%*) and estimated
expenses. 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--In the opinion of special counsel for the Sponsors, for Federal
income tax purposes each Holder will be considered to have received the interest
on his pro rata portion of each Security when interest on the Security is
received by the Fund. Interest is subject to U.S. Federal income tax for U.S.
Holders but exempt from U.S. Federal income taxes, including withholding taxes,
for many foreign Holders. In addition, the Sponsors believe that Holders who are
individuals will not be subject to state and local personal income taxes on the
interest received by the Fund and distributed to them. (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 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-8
<PAGE>
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
The Sponsors, Trustee and Holders of Government Securities Income Fund, Monthly
Payment U.S. Treasury Series-21 (Laddered Maturities), 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-21 (Laddered Maturities), Defined Asset Funds as of November 1, 1994.
This financial statement is the responsibility of the Trustee. 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 November
1, 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
The Chase Manhattan Bank, N.A., the Trustee. An audit also includes assessing
the accounting principles used and significant estimates made by the Trustee, as
well as evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.
In our opinion, the financial statement referred to above presents fairly, in
all material respects, the financial position of Government Securities Income
Fund, Monthly Payment U.S. Treasury Series-21 (Laddered Maturities), Defined
Asset Funds at November 1, 1994 in conformity with generally accepted accounting
principles.
DELOITTE & TOUCHE LLP
New York, N.Y.
November 1, 1994
GOVERNMENT SECURITIES INCOME FUND
MONTHLY PAYMENT U.S. TREASURY SERIES-21
(LADDERED MATURITIES)
DEFINED ASSET FUNDS
STATEMENT OF CONDITION AS OF INITIAL DATE OF DEPOSIT, NOVEMBER 1, 1994
<TABLE>
<S> <C> <C>
TRUST PROPERTY
Investment in Securities--
Contracts to purchase Securities(1)................. $ 481,609.00
Accrued interest to Initial Date of Deposit on underlying
Securities.................................................. 11,679.01
--------------
Total............................................ $ 493,288.01
--------------
--------------
LIABILITY AND INTEREST OF HOLDERS
Liability--Accrued interest to Initial Date of Deposit on
underlying Securities(2)................................. $ 11,679.01
Interest of Holders--
500,000 Units of fractional undivided interest
outstanding:
Cost to investors(3)................................ $ 491,439.00
Gross underwriting commissions(4)................... (9,830.00)
--------------
Net amount applicable to investors............................................... 481,609.00
--------------
Total............................................................... $ 493,288.01
--------------
--------------
</TABLE>
- ------------
(1) Aggregate cost to the Fund of the Securities listed under Portfolio is based
on the offer 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 $492,679.02 has been deposited with the
Trustee. The amount of such letter or letters of credit includes $481,000.01
(equal to the purchase price to the Sponsors) for the purchase of $500,000
face amount of Securities in connection with contracts to purchase
Securities, plus $11,679.01 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 The BNA Bank,
New York Branch.
(2) Representing, as set forth under Description of the Fund--Income; Estimated
Current Return; 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 offer 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-9
<PAGE>
<PAGE>
PORTFOLIO OF GOVERNMENT ON THE INITIAL DATE OF DEPOSIT,
SECURITIES INCOME FUND, MONTHLY November 1, 1994
PAYMENT U.S. TREASURY SERIES-21 (Laddered Maturities)
DEFINED ASSET FUNDS
<TABLE>
<CAPTION>
YIELD TO
COST OF MATURITY ON
PORTFOLIO NO. AND TITLE OF FACE SECURITIES INITIAL DATE OF
SECURITIES CONTRACTED FOR AMOUNT COUPON MATURITY TO FUND(1) DEPOSIT
<C> <S> <C> <C> <C> <C> <C>
----------- ------ --------- -------------- ---------------
1. United States Treasury Notes $ 100,000 6.375% 1/15/00 $ 95,355.00 7.464%
2. United States Treasury Notes 100,000 7.500 11/15/01 99,391.00 7.612
3. United States Treasury Notes 100,000 7.500 5/15/02 99,242.00 7.633
4. United States Treasury Notes 100,000 6.250 2/15/03 91,183.00 7.706
5. United States Treasury Notes 100,000 7.250 8/15/04 96,438.00 7.774
----------- --------------
$ 500,000 $ 481,609.00
----------- --------------
----------- --------------
</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 $481,302.00, which is $307.00 (approximately .06% 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 October 31, 1994.
A-10
<PAGE>
<PAGE>
GOVERNMENT SECURITIES INCOME FUND
MONTHLY PAYMENT U.S. TREASURY SERIES-21
(LADDERED MATURITIES)
ESTIMATED CASH FLOW TO HOLDERS
The table below sets forth the per 1,000 Units estimated monthly
distributions of principal and interest to Holders. The table assumes no changes
in expenses, no changes in current interest rates and no exchanges, redemptions,
sales or prepayments of the underlying Securities prior to maturity and the
receipt of principal upon maturity and therefore actual distributions may vary.
All fractions have been rounded.
TABLE OF ESTIMATED CASH FLOWS
<TABLE>
<CAPTION>
DATE AMOUNT
<S> <C>
- ------------------------------- ---------
February 1995 $ 5.22
March 1995-December 1999 5.72
January 2000 208.22
February 2000-October 2001 4.66
November 2001 207.60
December 2001-April 2002 3.41
May 2002 206.35
June 2002-January 2003 2.16
February 2003 204.61
March 2003-July 2004 1.12
August 2004 203.96
</TABLE>
A-11
<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. 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 offer 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. During the 90-day period following
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. Deposits of Additional Securities in the Portfolio
subsequent to the 90-day period following the Initial Date of Deposit must
replicate exactly the proportionate relationship among the face amounts of
Securities comprising the Portfolio at the end of the initial 90-day period,
subject to certain events as discussed under Administration of the
Fund--Portfolio Supervision.
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 that will pass through the Fund to
Holders in all states, as well as the exemption for many foreign investors who
generally will not be subject to U.S. Federal income taxes, including
withholding taxes, on income from the Fund (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. The Fund seeks to protect against declining
interest rates by investing a portion of the Portfolio in longer-term
Securities, while if interest rates rise Holders will be able to reinvest the
proceeds of principal returned each year in higher yielding obligations. It is
anticipated that equal portions of principal invested will be returned annually
as Securities mature. In order for the Securities to be eligible for inclusion
in the Fund, they must have been issued after July 18, 1984. 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
2
<PAGE>
<PAGE>
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 offer side evaluation of the Securities)
from the date they commit for Units.
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 and whether they were issued after July 18,
1984; (ii) the prices of the securities relative to other comparable securities
and the extent to which certain of these securities are trading at a discount
from par 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, subject to
certain events (Sections 3.07, 3.08, 3.10 and 3.10A). 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.
Estimated Current Return on a Unit represents annual cash to be received
from interest-bearing Debt Obligations in the Portfolio (net of estimated annual
expenses) divided by the Public Offering Price (including sales charge).
Estimated Long Term Return is a measure of the estimated return earned over the
estimated life of the Fund. This Return represents an average of the yields to
maturity of the Securities in the Portfolio, calculated in accordance with
accepted bond practice and adjusted to reflect expenses and sales charges. Bonds
are customarily offered on a 'yield price' basis, which reflects computation of
yield to maturity and not only the interest payable but amortization or
accretion to a specified date of any premium over or discount from 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 each
Security's yield by its market value and the time remaining to the call or
maturity date depending on how the Security is priced. The average Portfolio
yield is then adjusted to reflect estimated expenses and the maximum sales
charge. This calculation does not reflect certain delays in distributing income
nor the timing of other receipts and distributions on
4
<PAGE>
<PAGE>
Units; depending on maturities, it may therefore overstate or understate the
impact of sales charges. Both of these factors may result in a lower figure.
Both Estimated Current Return and Estimated Long Term Return can fluctuate
with changes in Portfolio composition, in market value of the Securities, in
Fund expenses, and sales charges; these returns therefore can vary materially
from the figures at the time of purchase. Any difference between Estimated
Current Return and Estimated Long Term Return will probably fluctuate at least
as frequently. No return estimate can be predictive of an investor's actual
return because an investor's actual return will depend on many factors,
including the value of the underlying bonds when the investor purchases and
sells units of the Fund and the period of time the investor holds the units.
Therefore, Estimated Current Return and Estimated Long Term Return are designed
to be comparative rather than predictive. A yield calculation which is more
comparable to an individual bond may be higher or lower than Estimated Current
Return or Estimated Long Term Return which are more comparable to return
calculations used by other investment products.
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.
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.
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
The following discussion addresses only the tax consequences of Units held
as capital assets and does not address the tax consequences of Units held by
dealers, financial institutions, or insurance companies.
In the opinion of Davis Polk & Wardwell, special counsel for the
Sponsors, under existing law:
The Fund is not an association taxable as a corporation for Federal
income tax purposes and income received by the Fund will be treated as the
income of the Holders in the manner set forth below.
Each Holder will be considered the owner of a pro rata portion of each
Security in the Fund under the grantor trust rules of Sections 671-679 of
the Internal Revenue Code of 1986, as amended (the 'Code'). In order to
determine the face amount of a Holder's pro rata portion of each Security
on the Initial Date of Deposit, see Face Amount under Portfolio. The total
cost to a Holder of his Units, including sales charges, is allocated to his
pro rata portion of each Security, in proportion to the fair market values
thereof on the date the Holder purchases his Units, in order to determine
his tax cost for his pro rata portion of each Security. In order for a
Holder who purchases his Units on the Initial Date of Deposit to determine
the fair market value of his pro rata portion of each Security on that
date, see Cost of Securities to Fund under Portfolio.
5
<PAGE>
<PAGE>
Each Holder will be considered to have received the interest on his
pro rata portion of each Security when interest on the Security is received
by the Fund. An individual Holder who itemizes deductions may deduct his
pro rata share of fees and expenses of the Fund only to the extent that
such amount together with the Holder's other miscellaneous deductions
exceeds 2% of his adjusted gross income.
The Fund may contain Securities that were originally issued at a
discount ('original issue discount'). The following principles will apply
to each Holder's pro rata portion of any Security originally issued at a
discount. In general, original issue discount is defined as the difference
between the price at which a debt obligation was issued and its stated
redemption price at maturity. Original issue discount will accrue as
interest over the life of the obligation under a formula based on the
compounding of interest. If a Holder's tax basis for his pro rata portion
of a Security issued with original issue discount is greater than its
'adjusted issue price' but less than its stated redemption price at
maturity, the Holder will be considered to have purchased his pro rata
portion of the Security at an 'acquisition premium'. The amount of accrued
original issue discount which must be accrued will be reduced by the amount
of such acquisition premium. Each Holder will be required to include in
income the amount of original issue discount which accrues on his pro rata
portion of any Debt Obligation originally issued at a discount. The amount
of accrued original issue discount so included in income in respect of a
Holder's pro rata portion of a Security is added to the Holder's tax basis
therefor.
If a Holder's tax basis for his pro rata portion of a Security exceeds
the redemption price at maturity thereof, (subject to certain adjustments)
the Holder will be considered to have purchased his pro rata portion of the
Security at a 'bond premium'. The Holder may elect to amortize the premium
prior to the maturity of the Security. The amount amortized in any year
should be applied to offset the Holder's interest from the Security and
will result in a reduction of basis for his pro rata portion of the
Security.
A Holder will recognize taxable gain or loss when all or part of his
pro rata portion of a Security is disposed of by the Fund for an amount
greater or less than his adjusted tax basis. Any such taxable gain or loss
will be capital gain or loss except that any gain from the disposition of a
Holder's pro rata portion of a Security acquired by the Holder at 'market
discount' (i.e., if the Holder's original cost for his pro rata portion of
the Security (plus any original issue discount which will accrue thereon)
is less than its stated redemption price at maturity) will be treated as
ordinary income to the extent the gain does not exceed the accrued market
discount. Capital gains are generally taxed at the same rate as ordinary
income. However, the excess of net long-term capital gains over net
short-term capital losses may be taxed at a lower rate than ordinary income
for certain noncorporate taxpayers. A capital gain or loss is long-term if
the asset is held for more than one year and short-term if held for one
year or less. The deduction of capital losses is subject to limitations. A
Holder will also be considered to have disposed of all or part of his pro
rata portion of each Security when he sells or redeems all or some of his
Units.
A distribution to a Holder of Securities upon redemption of Units will
not be a taxable event to the Holder or to nonredeeming Holders. The
redeeming Holder's basis for such Securities will be equal to the basis for
the Securities (previously represented by his Units) prior to the
redemption, and his holding period for the Securities will include the
period during which he held his Units. However, the Holder may recognize
taxable gain or loss when the Holder sells the Securities so distributed
for cash.
Under the income tax laws of the State and City of New York, the Fund
is not an association taxable as a corporation and income received by the
Fund will be treated as the income of the Holders in the same manner as for
Federal income tax purposes.
Notwithstanding the foregoing, a Holder who is a non-resident alien
individual or foreign corporation (a 'Foreign Holder') will generally not
be subject to United States Federal income taxes, including withholding
taxes, on the interest income (including any original issue discount) on,
or any gain from the sale or other disposition of, his pro rata portion of
any Security provided that (i) the interest income or gain is not
effectively connected with the conduct by the Foreign Holder of a trade or
business within the United States, (ii) with respect to any gain, the
Foreign Holder (if an individual) is not present in the United States for
183 days or more during the calendar year, and (iii) the Foreign Holder
provides the required certification of his status and of certain other
matters. Withholding agents
6
<PAGE>
<PAGE>
will file with the Internal Revenue Service foreign person information
returns with respect to such interest payments accompanied by such
certifications. Foreign Holders should consult their own tax advisers with
respect to United States Federal income tax consequences of ownership of
Units.
* * *
After the end of each calendar year, the Trustee will furnish to each
Holder an annual report containing information relating to the interest received
by the Fund on the Securities, the gross proceeds received by the Fund from the
disposition of Securities (resulting from redemption or payment at maturity of
any Security or any sale by the Fund of a Security) and the fees and expenses
paid by the Fund. The Trustee will also furnish annual information returns to
each Holder and to the Internal Revenue Service.
The Sponsors believe that Holders who are individuals will not be subject
to any state or local personal income taxes on the interest received by the Fund
and distributed to them. However, Holders (including individuals) may be subject
to state and local taxes on any capital gains (or market discount treated as
ordinary income) derived from the Fund and to other state and local taxes
(including corporate income or franchise taxes, personal property or intangibles
taxes, and estate or inheritance taxes) on their Units or the income derived
therefrom. In addition, individual Holders (and any other Holders which are not
subject to state and local taxes on the interest income derived from the Fund)
will probably not be entitled to a deduction for state and local tax purposes
for their share of the fees and expenses paid by the Fund, for any amortized
bond premium or for any interest on indebtedness incurred to purchase or carry
their Units. Therefore, even though the Sponsors believe that interest income
from the Fund is exempt from state and local personal income taxes in all
states, Holders should consult their own tax advisers with respect to state and
local 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
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 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
7
<PAGE>
<PAGE>
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.
Corporate Pension and Profit Sharing Plan. A pension or profit-sharing plan
established for employees of a corporation may purchase Units of the Funds.
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 1,000,000 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 1,000,000....................... 2.00% 2.041% 1.300% $ 14.40
1,000,000 or more......................... 1.00 1.010 0.650 7.20
</TABLE>
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 1,000,000..................................... 2.25% 2.302% 1.463%
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
8
<PAGE>
<PAGE>
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.
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.
9
<PAGE>
<PAGE>
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 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
10
<PAGE>
<PAGE>
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).
The aggregate current bid or offer side 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.
11
<PAGE>
<PAGE>
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 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. 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 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. At the same
time the Trustee will distribute the Holder's pro rata share of any
distributable cash balance of the Capital Account computed as of the close of
business on the
12
<PAGE>
<PAGE>
preceding Record Day (if at least equal to the Minimum Capital Distribution set
forth under Investment Summary). 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. As each Treasury note in the
Portfolio matures, the balance in the Capital Account shall be distributed on or
about the second business day following the maturity of each Security; the
Record Day for that distribution shall be the business day immediately preceding
the distribution day. 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).
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. Whenever
a Replacement Security has been acquired for a Trust, the Trustee shall, on the
next Distribution Date 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.
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 during the 90-day period subsequent to the Initial Date of
Deposit, provided that the original proportionate relationship among the face
amounts of each Security established on the Initial Date of Deposit (the
'Original Proportionate Relationship') is maintained to the extent practicable.
Deposits of Additional
13
<PAGE>
<PAGE>
Securities subsequent to the 90-day period following the Initial Date of Deposit
must replicate exactly the original proportionate relationship among the face
amounts of Securities comprising the Portfolio at the end of the initial 90-day
period, subject to certain events (Section 3.07, 3.08, 3.10 and 3.10A).
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 during the 90-day period following the Initial Date of
Deposit, the Sponsors may specify minimum face amounts in which Additional
Securities will be deposited or purchased. If a deposit is not sufficient to
acquire minimum amounts of each Security, Additional Securities may be acquired
in the order of the Security most under-represented immediately before the
deposit when compared to the Original Proportionate Relationship. If Securities
of an issue originally deposited are unavailable at the time of subsequent
deposit or cannot be purchased at reasonable prices or their purchase is
prohibited or restricted by law, regulation or policies applicable to 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. Any funds held to acquire Additional or Replacement
Securities which have not been used to purchase Securities at the end of the
90-day period beginning with the Initial Date of Deposit, shall be used to
purchase Securities as described above or shall be distributed to Holders
together with the attributable sales charge.
REPORTS TO HOLDERS
The Trustee will furnish Holders with each distribution a statement of the
amounts of interest and other receipts which are being distributed, expressed in
each case as a dollar amount per Unit. 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).
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.
14
<PAGE>
<PAGE>
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).
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
15
<PAGE>
<PAGE>
(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 subject to supervision by the Federal Deposit Insurance Corporation, the
Board of Governors of the Federal Reserve System and either the Comptroller of
the Currency or State Banking Regulations.
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.
AUDITORS
The Statement of Condition, including the Portfolio of the Fund, included
herein has been audited by Deloitte & Touche LLP, 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.
SPONSORS
Each Sponsor is a Delaware corporation and is engaged in the underwriting,
securities and commodities brokerage business, and is a member of the New York
Stock Exchange, Inc., other major securities exchanges and commodity exchanges,
and the National Association of Securities Dealers, Inc. Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Merrill Lynch Asset Management, a Delaware
corporation, each of which is a subsidiary of Merrill Lynch & Co., Inc., are
engaged in the investment advisory business. Smith Barney Inc., an investment
banking and securities broker-dealer firm, is an indirect wholly-owned
subsidiary of The Travelers Inc. Prudential Securities Incorporated, a
wholly-owned subsidiary of Prudential Securities Inc. and an indirect
wholly-owned subsidiary of the Prudential Insurance Company of America, is
engaged in the investment advisory business. Dean Witter Reynolds Inc., a
principal operating subsidiary of Dean Witter, Discover & Co., is engaged in the
investment advisory business. PaineWebber Incorporated is engaged in the
investment advisory business and is a wholly-owned subsidiary of PaineWebber
Group Inc. Each Sponsor has acted as principal underwriter and managing
underwriter of other investment companies.
16
<PAGE>
<PAGE>
The Sponsors, in addition to participating as members of various selling groups
or as agents of other investment companies, execute orders on behalf of
investment companies for the purchase and sale of securities of these companies
and sell securities to these companies in their capacities as brokers or dealers
in securities.
Each Sponsor (or a predecessor) has acted as Sponsor of various series of
Defined Asset Funds. A subsidiary of Merrill Lynch, Pierce, Fenner & Smith
Incorporated succeeded in 1970 to the business of Goodbody & Co., which had been
a co-Sponsor of Defined Asset Funds since 1964. That subsidiary resigned as
Sponsor of each of the Goodbody series in 1971. Merrill Lynch, Pierce, Fenner &
Smith Incorporated has been co-Sponsor and the Agent for the Sponsors of each
series of Defined Asset Funds created since 1971. Shearson Lehman Brothers Inc.
('Shearson') and certain of its predecessors were underwriters beginning in 1962
and co-Sponsors from 1965 to 1967 and from 1980 to 1993 of various Defined Asset
Funds. As a result of the acquisition of certain of Shearson's assets by Smith
Barney, Harris Upham & Co. Incorporated and Primerica Corporation (now The
Travelers Inc.), Smith Barney Inc. now serves as co-Sponsor of various Defined
Asset Funds. Prudential Securities Incorporated and its predecessors have been
underwriters of Defined Asset Funds since 1961 and co-Sponsors since 1964, in
which year its predecessor became successor co-Sponsor to the original Sponsor.
Dean Witter Reynolds Inc. and its predecessors have been underwriters of various
Defined Asset Funds since 1964 and co-Sponsors since 1974. PaineWebber
Incorporated and its predecessor have co-Sponsored certain Defined Asset Funds
since 1983.
The Sponsors have maintained secondary markets for Defined Asset Funds for
over 20 years. For decades informed investors have purchased unit investment
trusts for dependability and professional selection of investments. Defined
Asset Funds offers an array of simple and convenient investment choices, suited
to fit a wide variety of personal financial goals--a buy and hold strategy for
capital accumulation, such as for children's education or a nest egg for
retirement, or attractive, regular current income consistent with relative
protection of capital. There are Defined Funds to meet the needs of just about
any investor. Unit investment trusts are particularly suited for the many
investors who prefer to seek long-term profits by purchasing sound investments
and holding them, rather than through active trading. Few individuals have the
knowledge, resources, capital or time to buy and hold a diversified portfolio on
their own; it would generally take a considerable sum of money to obtain the
breadth and diversity offered by Defined Funds. Sometimes it takes a combination
of Defined Funds to plan an investor's objectives.
One of the most important investment decisions investors face may be how to
allocate their investments among asset classes. Diversification among different
kinds of investments can balance the risks and rewards of each one. Most
investment experts recommend stocks for long-term capital growth. Long-term
corporate bonds offer relatively high rates of interest income. By purchasing
both defined equity and defined bond funds, investors can receive attractive
current income, as well as growth potential, offering some protection against
inflation.
The following chart shows the average annual compounded rate of return of
selected asset classes over the 10-year and 20-year periods ending December 31,
1993, compared to the rate of inflation over the same periods. Of course, this
chart represents past performance of these investment categories and is no
guarantee of future results, either of these categories or of any Defined Fund.
Defined Funds also have sales charges and expenses, which are not reflected in
the chart.
17
<PAGE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Stocks (S&P 500)
20 yr. 12.76%
10 yr. 14.94%
Small-company stocks
20 yr. 18.82%
10 yr. 9.96%
Long-term corporate bonds
20 yr. 10.16%
10 yr. 14.00%
U.S. Treasury bills (short-term)
20 yr. 7.49%
10 yr. 6.35%
Consumer Price Index
20 yr. 5.92%
10 yr. 3.73%
0 2 4 6 8 10 12 14 16 18 20 %
</TABLE>
Source: Ibbotson Associates (Chicago)
Used with permission. All rights reserved.
By purchasing Defined Funds investors not only avoid the responsibility of
selecting individual securities on their own, they benefit from the expertise of
Defined Asset Funds' experienced buyers and research analysts. In addition, they
gain the advantage of diversification by investing in Units of a Defined Fund
holding securities of several different issuers. Such diversification reduces
risk, but does not eliminate it. While the portfolio of a managed fund, such as
a mutual fund, continually changes, defined bond funds offer a defined portfolio
and a schedule of income distributions identified in the Prospectus. Investors
know, generally, when they buy the issuers, maturities, call dates and ratings
of the securities in the portfolio. Of course, the portfolio may change somewhat
over time as additional securities are deposited, as Securities mature or are
called or redeemed or as they are sold to meet redemptions and in certain other
limited circumstances. Investors also know at the time of purchase their
estimated income and current and long-term returns, subject to credit and market
risks and to changes in the portfolio or the fund expenses.
Defined Asset Funds offers a variety of fund types. The tax exemption of
municipal securities, which makes them attractive to high-bracket taxpayers, is
offered by Defined Municipal Investment Trust Funds. Municipal Defined Funds
offer a simple and convenient way for investors to earn monthly income free from
regular Federal income tax. Defined Municipal Investment Trust Funds have
provided investors with tax-free income for more than 30 years. Defined
Corporate Income Funds, with higher current returns than municipal or government
funds, are suitable for Individual Retirement Accounts and other tax-advantaged
accounts and offer investors a simple and convenient way to earn monthly income.
Defined Corporate Income Funds have provided investors with monthly income for
more than 20 years. Defined Government Securities Income Funds offer investors a
simple and convenient way to participate in markets for Government securities
while earning an attractive current return. Defined International Bond Funds,
holding bonds payable in foreign currencies, offer the potential to profit from
changes in currency values and possibly from interest rates higher than paid on
comparable U.S. bonds, but investors incur a higher risk for these potentially
greater returns. Historically, stocks have offered a potential for growth of
capital, and thus some protection against inflation, over the long term. Defined
Equity Income Funds offer participation in the stock market, providing current
income as well as the possibility of capital appreciation. The S&P Index Trusts
offer a convenient and inexpensive way to participate in broad market movements.
Concept Series seek to capitalize on selected anticipated economic, political or
business trends. Utility Stock Series, consisting of stocks of issuers with
established reputations for regular cash dividends, seek to benefit from
dividend increases. Select Ten Portfolios seek total return by investing for one
year in the ten highest yielding stocks on a designated stock index.
18
<PAGE>
<PAGE>
DESCRIPTION OF RATINGS (as described by Standard & Poor's)
A Standard & Poor's rating on the units of an investment trust (hereinafter
referred to collectively as 'units' and 'fund') is a current assessment of
creditworthiness with respect to the investments held by such fund. This
assessment takes into consideration the financial capacity of the issuers and of
any guarantors, insurers, lessees, or mortgagors with respect to such
investments. The assessment, however, does not take into account the extent to
which fund expenses or portfolio asset sales for less than the fund's purchase
price will reduce payment to the unit holder of the interest and principal
required to be paid on the portfolio assets. In addition, the rating is not a
recommendation to purchase, sell, or hold units, inasmuch as the rating does not
comment as to market price of the units or suitability for a particular
investor.
Funds rated AAA are composed exclusively of assets that are rated AAA by
Standard & Poor's and/or certain short-term investments. Standard & Poor's
defines its AAA rating for such assets as the highest rating assigned by
Standard & Poor's to a debt obligation. Capacity to pay interest and repay
principal is extremely strong.
19
<PAGE>
<PAGE>
Defined
Asset FundsSM
<TABLE>
<S> <C>
Sponsors: Government
Merrill Lynch, Securities Income Fund
Pierce, Fenner & Monthly Payment
Smith Inc. U.S. Treasury Series-21
Unit Investment
Trusts
P.O. Box 9051
Princeton, NJ
08543-9051
(609) 282-8500
(Laddered Maturities)
Smith Barney Inc. A Unit Investment Trust
Unit Trust
Department
Two World Trade
Center
101st Floor
New York, NY 10048
1-800-298-UNIT
Prospectus
PaineWebber This Prospectus does not contain all of the information
Incorporated with respect to the investment company set forth in its
1200 Harbor registration statement and exhibits relating thereto
Boulevard which have been filed with the Securities and Exchange
Weehawken, NJ 07087 Commission, Washington, D.C. under the Securities Act of
(201) 902-3000
Prudential 1933 and the Investment Company Act of 1940, and to which
Securities reference is hereby made.
Incorporated
One Seaport Plaza
199 Water Street
New York, NY 10292
(212) 776-1000 No person is authorized to give any information or to
make any representations with respect to this investment
Dean Witter Reynolds company not contained in this Prospectus; and any
Inc. information or representation not contained herein must
Two World Trade not be relied upon as having been authorized. This
Center Prospectus does not constitute an offer to sell, or a
59th Floor solicitation of an offer to buy, securities in any state
New York, NY 10048 to any person to whom it is not lawful to make such offer
(212) 392-2222 in such state.
Evaluator:
Kenny S&P Evaluation
Services
65 Broadway
New York, N.Y. 10006
Independent
Accountants:
Deloitte & Touche
LLP
1633 Broadway
3rd Floor
New York, NY 10019
Trustee:
The Chase Manhattan
Bank, N.A.
Unit Trust
Department
P.O. Box 2051
New York, NY 10081
1-800-323-1508
</TABLE>
14995-11/94
<PAGE>
<PAGE>
PART II
Additional Information Not Included in the Prospectus
<TABLE>
<C> <S> <C>
A. The following information relating to the Depositors is incorporated by reference to the SEC
filings indicated and made a part of this Registration Statement.
SEC FILE OR
IDENTIFICATION NUMBER
----------------------------
I. Bonding Arrangements and Date of Organization of the Depositors
filed pursuant to Items A and B of Part II of the Registration
Statement on Form S-6 under the Securities Act of 1933:
Merrill Lynch, Pierce, Fenner & Smith Incorporated............. 2-52691
Prudential Securities Incorporated............................. 2-61418
Smith Barney Inc............................................... 33-29106
Dean Witter Reynolds Inc....................................... 2-60599
PaineWebber Incorporated....................................... 2-87965
II. Information as to Officers and Directors of the Depositors filed
pursuant to Schedules A and D of Form BD under Rules 15b1-1 and
15b3-1 of the Securities Exchange Act of 1934:
Merrill Lynch, Pierce, Fenner & Smith Incorporated............. 8-7721
Prudential Securities Incorporated............................. 8-12321
Smith Barney Inc............................................... 8-8177
Dean Witter Reynolds Inc....................................... 8-14172
PaineWebber Incorporated....................................... 8-16267
III. Charter documents of the Depositors filed as Exhibits to the
Registration Statement on Form S-6 under the Securities Act of
1933 (Charter, By-Laws):
Merrill Lynch, Pierce, Fenner & Smith Incorporated............. 2-73866, 2-77549
Prudential Securities Incorporated............................. 2-86941, 2-86941
Smith Barney Inc............................................... 33-20499
Dean Witter Reynolds Inc....................................... 2-60599, 2-86941
PaineWebber Incorporated....................................... 2-87965, 2-87965
B. The Internal Revenue Service Employer Identification Numbers of the Sponsors and Trustee are
as
follows:
Merrill Lynch, Pierce, Fenner & Smith Incorporated............. 13-5674085
Prudential Securities Incorporated............................. 13-6134767
Smith Barney Inc............................................... 13-1912900
Dean Witter Reynolds Inc....................................... 94-1671384
PaineWebber Incorporated....................................... 13-2638166
The Chase Manhattan Bank, N.A.................................. 13-2633612
</TABLE>
II-1
<PAGE>
<PAGE>
SERIES OF GOVERNMENT SECURITIES INCOME FUND
AND MUNICIPAL INVESTMENT TRUST FUND
DESIGNATED PURSUANT TO RULE 487 UNDER THE SECURITIES ACT OF 1933
<TABLE>
<CAPTION>
SEC
SERIES NUMBER FILE NUMBER
<S> <C>
Government Securities Income Fund, Monthly Payment U.S. Treasury Series-1............... 2-81969
Municipal Investment Trust Fund, Four Hundred Thirty-Eighth Monthly Payment Series...... 33-16561
Government Securities Income Fund, Monthly Payment U.S. Treasury Series-8............... 33-31728
Municipal Investment Trust Fund, Multistate Series-48................................... 33-50247
Government Securities Income Fund, U.S. Treasury Strategy Trust-1....................... 33-48915
</TABLE>
CONTENTS OF REGISTRATION STATEMENT
The Registration Statement on Form S-6 comprises the following papers and
documents:
The facing sheet of Form S-6.
The Cross-Reference Sheet (incorporated by reference to the
Cross-Reference Sheet to the Registration
Statement of The Government Securities Income Fund, GNMA Series R, 1933 Act File
No. 2-88061).
The Prospectus.
Additional Information not included in the Prospectus (Part II). Consent
of independent accountants.
The following exhibits:
<TABLE>
<S> <C> <C>
1.1 -- Form of Trust Indenture (incorporated by reference to Exhibit 1.1.1 to the
Registration Statement of Government Securities Income Fund, Monthly Payment U.S.
Treasury Series-17, 1933 Act File No. 33-49983).
1.1.1 -- Form of Standard Terms and Conditions of Trust Effective October 21, 1993
(incorporated by reference to Exhibit 1.1.1 to the Registration Statement of
Municipal Investment Trust Fund, Multistate Series 48, 1933 Act File No. 33-50247).
1.2 -- Form of Master Agreement Among Underwriters (incorporated by reference to Exhibit 1.2
to the Registration Statement of The Corporate Income Fund, One Hundred Ninety-Fourth
Monthly Payment Series, 1933 Act File No. 2-90925).
2.1 -- Form of Certificate of Beneficial Interest (included in Exhibit 1.1.1).
3.1 -- Opinion of counsel as to the legality of the securities being issued including their
consent to the
use of their names under the headings 'Taxes' and 'Miscellaneous--Legal Opinion' in
the
Prospectus.
4.1.1 -- Consent of the Evaluator.
4.1.2 -- Consent of Rating Agency.
</TABLE>
R-1
<PAGE>
<PAGE>
SIGNATURES
The registrant hereby identifies the series numbers of Government
Securities Income Fund and Municipal Investment Trust Fund listed on page R-1
for the purposes of the representations required by Rule 487 and represents the
following:
1) That the portfolio securities deposited in the series as to which this
registration statement is being filed do not differ materially in type
or quality from those deposited in such previous series;
2) That, except to the extent necessary to identify the specific portfolio
securities deposited in, and to provide essential information for, the
series with respect to which this registration statement is being filed,
this registration statement does not contain disclosures that differ in
any material respect from those contained in the registration statements
for such previous series as to which the effective date was determined
by the Commission or the staff; and
3) That it has complied with Rule 460 under the Securities Act of 1933.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT OR AMENDMENT TO THE REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED THEREUNTO DULY
AUTHORIZED IN THE CITY OF NEW YORK AND STATE OF NEW YORK ON THE 1ST DAY OF
NOVEMBER, 1994.
SIGNATURES APPEAR ON PAGES R-3, R-4, R-5, R-6 AND R-7.
A majority of the members of the Board of Directors of Merrill Lynch,
Pierce, Fenner & Smith Incorporated has signed this Registration Statement or
Amendment to the Registration Statement pursuant to Powers of Attorney
authorizing the person signing this Registration Statement or Amendment to the
Registration Statement to do so on behalf of such members.
A majority of the members of the Board of Directors of Prudential
Securities Incorporated has signed this Registration Statement or Amendment to
the Registration Statement pursuant to Powers of Attorney authorizing the person
signing this Registration Statement or Amendment to the Registration Statement
to do so on behalf of such members.
A majority of the members of the Board of Directors of Smith Barney Inc.
has signed this Registration Statement or Amendment to the Registration
Statement pursuant to Powers of Attorney authorizing the person signing this
Registration Statement or Amendment to the Registration Statement to do so on
behalf of such members.
A majority of the members of the Board of Directors of Dean Witter
Reynolds Inc. has signed this Registration Statement or Amendment to the
Registration Statement pursuant to Powers of Attorney authorizing the person
signing this Registration Statement or Amendment to the Registration Statement
to do so on behalf of such members.
A majority of the members of the Executive Committee of the Board of
Directors of PaineWebber Incorporated has signed this Registration Statement or
Amendment to the Registration Statement pursuant to Powers of Attorney
authorizing the person signing this Registration Statement or Amendment to the
Registration Statement to do so on behalf of such members.
R-2
<PAGE>
<PAGE>
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
DEPOSITOR
<TABLE>
<S> <C>
By the following persons, who constitute a majority of Powers of Attorney have been filed under Form
the Board of Directors of Merrill Lynch, Pierce, SE and the following 1933 Act File Numbers:
Fenner & Smith Incorporated: 33-43466 and 33-51607
</TABLE>
HERBERT M. ALLISON, JR.
BARRY S. FREIDBERG
EDWARD L. GOLDBERG
STEPHEN L. HAMMERMAN
JEROME P. KENNEY
DAVID H. KOMANSKY
DANIEL T. NAPOLI
THOMAS H. PATRICK
JOHN L. STEFFENS
DANIEL P. TULLY
ROGER M. VASEY
ARTHUR H. ZEIKEL
ERNEST V. FABIO
-----------------------------
By: ERNEST V. FABIO
(As authorized signatory for Merrill Lynch, Pierce,
Fenner & Smith Incorporated and
Attorney-in-fact for the persons listed above)
R-3
<PAGE>
<PAGE>
PRUDENTIAL SECURITIES INCORPORATED
DEPOSITOR
<TABLE>
<S> <C>
By the following persons, who constitute a majority of Powers of Attorney have been filed under Form
the Board of Directors of Prudential Securities SE and the following 1933 Act File Number:
Incorporated: 33-41631
</TABLE>
ALAN D. HOGAN
HOWARD A. KNIGHT
GEORGE A. MURRAY
LELAND B. PATON
HARDWICK SIMMONS
RICHARD R. HOFFMANN
---------------------------------------
By: RICHARD R. HOFFMANN
(As authorized signatory for Prudential Securities
Incorporated and Attorney-in-fact for the persons
listed above)
R-4
<PAGE>
<PAGE>
SMITH BARNEY INC.
DEPOSITOR
<TABLE>
<S> <C>
By the following persons, who constitute a majority of Powers of Attorney have been filed under the
the Board of Directors of Smith Barney Inc.: following 1933 Act File Numbers: 33-56722
and 33-51999
</TABLE>
STEVEN D. BLACK
JAMES BOSHART III
ROBERT A. CASE
JAMES DIMON
ROBERT DRUSKIN
ROBERT F. GREENHILT
JEFFREY LANE
ROBERT H. LESSIN
JACK L. RIVKIN
GINA LEMON
------------------------
By: GINA LEMON
(As authorized signatory for
Smith Barney Inc. and
Attorney-in-fact for the persons listed above)
R-5
<PAGE>
<PAGE>
DEAN WITTER REYNOLDS INC.
DEPOSITOR
<TABLE>
<S> <C>
By the following persons, who constitute a majority of Powers of Attorney are being filed under Form
the Board of Directors of Dean Witter Reynolds Inc.: SE and the following 1933 Act File Number:
33-17085
</TABLE>
NANCY DONOVAN
CHARLES A. FIUMEFREDDO
JAMES F. HIGGINS
STEPHEN R. MILLER
PHILIP J. PURCELL
THOMAS C. SCHNEIDER
WILLIAM B. SMITH
MICHAEL D. BROWNE
-----------------------------------
By: MICHAEL D. BROWNE
(As authorized signatory for
Dean Witter Reynolds Inc. and
Attorney-in-fact for the persons listed above)
R-6
<PAGE>
<PAGE>
PAINEWEBBER INCORPORATED
DEPOSITOR
<TABLE>
<S> <C>
By the following persons, who constitute a majority of Powers of Attorney are being filed under Form
the Executive Committee of the Board of Directors of SE and the following 1933 Act File Number:
PaineWebber Incorporated: 33-55073
</TABLE>
PAUL B. GUENTHER
DONALD B. MARRON
JOSEPH J. GRANO, JR.
LEE FENSTERSTOCK
ROBERT E. HOLLEY
---------------------------------
By: ROBERT E. HOLLEY
(As authorized signatory for
PaineWebber Incorporated and
Attorney-in-fact for the persons listed above)
R-7
<PAGE>
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
The Sponsors and Trustee of
Government Securities Income Fund,
Monthly Payment U.S. Treasury Series-21 (Laddered Maturities)
Defined Asset Funds:
We hereby consent to the use in this Registration Statement No. 33-55247 of our
opinion dated November 1, 1994, relating to the Statement of Condition of
Government Securities Income Fund, Monthly Payment U.S. Treasury Series-21
(Laddered Maturities), Defined Asset Funds, and to the reference to us under the
heading 'Auditors' in the Prospectus which is a part of this Registration
Statement.
Deloitte & Touche LLP
New York, N.Y.
November 1, 1994
R-8
<PAGE>
<PAGE>
EXHIBIT 3.1
DAVIS POLK & WARDWELL
450 LEXINGTON AVENUE
NEW YORK, NEW YORK 10017
(212) 450-4000
NOVEMBER 1, 1994
Government Securities Income Fund,
Monthly Payment U.S. Treasury Series-21 (Laddered Maturities)
Defined Asset Funds
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Smith Barney Inc.
PaineWebber Incorporated
Prudential Securities Incorporated
Dean Witter Reynolds Inc.
c/o Merrill Lynch, Pierce, Fenner & Smith Incorporated
Unit Investment Trusts
P.O. Box 9051
Princeton, N.J. 08543-9051
Dear Sirs:
We have acted as special counsel for you, as sponsors (the 'Sponsors') of
Monthly Payment U.S. Treasury
Series--21 (Laddered Maturities) of Government Securities Income Fund, Defined
Asset Funds (the 'Fund'), in connection with the issuance of units of fractional
undivided interest in the Fund (the 'Units') in accordance with the Trust
Indenture relating to the Fund (the 'Indenture').
We have examined and are familiar with originals or copies, certified or
otherwise identified to our satisfaction, of such documents and instruments as
we have deemed necessary or advisable for the purpose of this opinion.
Based upon the foregoing, we are of the opinion that (i) the execution and
delivery of the Indenture and the issuance of the Units have been duly
authorized by the Sponsors and (ii) the Units, when duly executed and delivered
by the Sponsors and the Trustee in accordance with the Indenture, will be
legally issued, fully paid and non-assessable.
We hereby consent to the use of this opinion as Exhibit 3.1 to the
Registration Statement relating to the Units filed under the Securities Act of
1933 and to the use of our name in such Registration Statement and in the
related prospectus under the heading 'Miscellaneous--Legal Opinion.'
Very truly yours,
Davis Polk & Wardwell
<PAGE>
<PAGE>
EXHIBIT 4.1.1
NOVEMBER 1, 1994
Kenny S&P Evaluation Services
A Division of Kenny Information Systems, Inc.
65 Broadway
New York, N.Y. 10006
Telephone 212/770-4405
Fax 212/797-8681
F. A. Shinal
Senior Vice President
Chief Financial Officer
Kenny Information Systems, Inc.
<TABLE>
<S> <C>
Merrill Lynch, Pierce, Fenner & Smith Incorporated The Chase Manhattan Bank, N.A.
Unit Investment Trust Division 1 Chase Manhattan Plaza-3B
P.O. Box 9051 New York, N.Y. 10081
Princeton, N.J. 08543-9051
</TABLE>
RE: GOVERNMENT SECURITIES INCOME FUND, MONTHLY PAYMENT U.S. TREASURY SERIES-21
(LADDERED MATURITIES),
DEFINED ASSET FUNDS
Gentlemen:
We have examined the Registration Statement No. 33-55247 for the above
captioned fund. We hereby acknowledge that Kenny S&P Evaluation Services, a
division of Kenny Information Systems, Inc. is currently acting as the evaluator
for the Trust. We hereby consent to the use in the Registration Statement of the
reference to Kenny S&P Evaluation Services a division of Kenny Information
Systems, Inc. as evaluator.
You are hereby authorized to file a copy of this letter with the Securities
and Exchange Commission.
Sincerely,
By:
F. A. Shinal
Senior Vice President
Chief Financial Officer
<PAGE>
<PAGE>
EXHIBIT 4.1.2
NOVEMBER 1, 1994
Standard & Poor's Ratings Group
25 Broadway
New York, N.Y. 10004
Telephone 212/208-1061
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Unit Investment Trust Division
P.O. Box 9051
Princeton, N.J. 08543-9051
The Chase Manhattan Bank, N.A.
1 Chase Manhattan Plaza-3B
New York, NY 10081
RE: GOVENMENT SECURITIES INCOME FUND, MONTHLY PAYMENT U.S. TREASURY SERIES-21
(LADDERED MATURITIES),
DEFINED ASSET FUNDS 1933 ACT REGISTRATION NO. 33-55247
Dear Mr. Perini:
Pursuant to your request for a Standard & Poor's rating on the units of the
above-captioned trust, we have reviewed the information presented to us and have
assigned a 'AAA' rating to the units in the trust. The rating is a direct
reflection of the portfolio of the trust, which will be composed solely of U.S.
Treasury Debt Obligations fully guaranteed as to principal and interest by the
full faith and credit of the United States.
You have permission to use the name of Standard & Poor's and the
above-assigned rating in connection with your dissemination of information
relating to these units, provided that it is understood that the rating is not a
'market' rating nor recommendations to buy, hold, or sell the units of the
trust. Further, it should be understood that the rating does not take into
account the extent to which fund expenses or portfolio asset sales for less than
the fund's purchase price will reduce payment to the unit holders of the
interest and principal required to be paid on the portfolio assets. S&P reserves
the right to advise its own clients, subscribers, and the public of the rating.
S&P relies on the Sponsor and its counsel, accountants, and other experts for
the accuracy and completeness of the information submitted in connection with
the ratings. S&P does not independently verify the truth or accuracy of any such
information.
This letter evidences our consent to the use of the name of Standard &
Poor's Corporation and the above-assigned rating in the registration statement
or prospectus relating to the units of the trust. However, this letter should
not be construed as a consent by us, within the meaning of Section 7 of the
Securities Act of 1933, to the use of the name of Standard & Poor's Corporation
in connection with the ratings assigned to the securities contained in the
trust. You are hereby authorized to file a copy of this letter with the
Securities and Exchange Commission.
Please be certain to send us three copies of your final prospectus as soon
as it becomes available. Should we not receive them within a reasonable time
after the closing or should they not conform to the representations made to us,
we reserve the right to withdraw the rating.
We are pleased to have had the opportunity to be of service to you. Our bill
will be sent to you within one month. If we can be of further help, please do
not hesitate to call upon us.
Very truly yours,
Richard P. Larki
<PAGE>
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 6
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> OTHER
<FISCAL-YEAR-END> OCT-31-1994
<PERIOD-END> NOV-1-1994
<INVESTMENTS-AT-COST> 481,609
<INVESTMENTS-AT-VALUE> 481,609
<RECEIVABLES> 11,679
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 493,288
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 11,679
<TOTAL-LIABILITIES> 11,679
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 481,609
<SHARES-COMMON-STOCK> 500,000
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 481,609
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 0
<NET-INVESTMENT-INCOME> 0
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 0
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 500,000
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 0
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<PAGE>
<PAGE>
</TABLE>
