<PAGE>
DEFINED ASSET FUNDS-REGISTERED TRADEMARK-
----------------------------------------------------
MUNICIPAL INVESTMENT TRUST FUND
MULTISTATE SERIES--64
(A UNIT INVESTMENT TRUST)
- CALIFORNIA, MARYLAND AND NEW JERSEY PORTFOLIOS
- PORTFOLIOS OF LONG-TERM MUNICIPAL BONDS
- DESIGNED TO BE FREE OF REGULAR FEDERAL INCOME TAX
- EXEMPT FROM SOME STATE TAXES
- MONTHLY DISTRIBUTIONS
SPONSORS:
MERRILL LYNCH,
PIERCE, FENNER & SMITH
INCORPORATED -----------------------------------------------------
SALOMON SMITH BARNEY INC. The Securities and Exchange Commission has not
PRUDENTIAL SECURITIES approved or disapproved these Securities or passed
INCORPORATED upon the adequacy of this prospectus. Any
PAINEWEBBER INCORPORATED representation to the contrary is a criminal offense.
DEAN WITTER REYNOLDS INC. Prospectus dated September 29, 2000.
<PAGE>
--------------------------------------------------------------------------------
Defined Asset Funds-Registered Trademark-
Defined Asset Funds-Registered Trademark- is America's oldest and largest family
of unit investment trusts, with over $160 billion sponsored over the last 28
years. Defined Asset Funds has been a leader in unit investment trust research
and product innovation. Our family of Funds helps investors work toward their
financial goals with a full range of quality investments, including municipal,
corporate and government bond portfolios, as well as domestic and international
equity portfolios.
Defined Asset Funds offer a number of advantages:
- A Disciplined strategy of buying and holding with a long-term view is the
cornerstone of Defined Asset Funds.
- Fixed portfolio: Defined Funds follow a buy and hold investment strategy;
funds are not managed and portfolio changes are limited.
- Defined Portfolios: We choose the stocks and bonds in advance, so you know
what you're investing in.
- Professional research: Our dedicated research team seeks out stocks or
bonds appropriate for a particular fund's objectives.
- Ongoing supervision: We monitor each portfolio on an ongoing basis.
No matter what your investment goals, tolerance for risk or time horizon,
there's probably a Defined Asset Fund that suits your investment style. Your
financial professional can help you select a Defined Asset Fund that works best
for your investment portfolio.
THE FINANCIAL INFORMATION IN THIS PROSPECTUS IS AS OF MAY 31, 2000, THE
EVALUATION DATE.
CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
California Insured Portfolio--
Risk/Return Summary............................. 3
Maryland Portfolio--
Risk/Return Summary............................. 6
New Jersey Insured Portfolio--
Risk/Return Summary............................. 9
What You Can Expect From Your Investment.......... 13
Monthly Income.................................. 13
Return Figures.................................. 13
Records and Reports............................. 13
The Risks You Face................................ 14
Interest Rate Risk.............................. 14
Call Risk....................................... 14
Reduced Diversification Risk.................... 14
Liquidity Risk.................................. 14
Concentration Risk.............................. 14
State Concentration Risk........................ 16
Bond Quality Risk............................... 17
Insurance Related Risk.......................... 17
Litigation and Legislation Risks................ 17
Selling or Exchanging Units....................... 18
Sponsors' Secondary Market...................... 18
Selling Units to the Trustee.................... 18
Exchange Option................................. 19
How The Fund Works................................ 19
Pricing......................................... 19
Evaluations..................................... 19
Income.......................................... 19
Expenses........................................ 20
Portfolio Changes............................... 20
Fund Termination................................ 20
Certificates.................................... 21
Trust Indenture................................. 21
Legal Opinion................................... 22
Auditors........................................ 22
Sponsors........................................ 22
Trustee......................................... 22
Underwriters' and Sponsors' Profits............. 23
Public Distribution............................. 23
Code of Ethics.................................. 23
Year 2000 Issues................................ 23
Taxes............................................. 23
Supplemental Information.......................... 26
Financial Statements.............................. D-1
</TABLE>
2
<PAGE>
--------------------------------------------------------------------------------
CALIFORNIA INSURED PORTFOLIO--RISK/RETURN SUMMARY
1. WHAT IS THE FUND'S OBJECTIVE?
The Fund seeks interest income that is exempt from regular federal income
taxes and some state and local taxes by investing in a fixed portfolio
consisting primarily of insured, long term municipal revenue bonds.
2. WHAT ARE MUNICIPAL REVENUE BONDS?
Municipal revenue bonds are bonds issued by states, municipalities and public
authorities to finance the cost of buying, building or improving various
projects intended to generate revenue, such as airports, health care
facilities, housing and municipal electric, water and sewer utilities.
Generally, payments on these bonds depend solely on the revenues generated by
the projects, excise taxes or state appropriations, and are not backed by the
government's taxing power.
3. WHAT IS THE FUND'S INVESTMENT STRATEGY?
- The Fund plans to hold to maturity 7 long-term tax-exempt municipal bonds
with an aggregate face amount of $2,535,000.
- The Fund is a unit investment trust which means that, unlike a mutual fund,
the Portfolio is not managed.
- The bonds are rated AAA or Aaa by Standard & Poor's, Moody's or Fitch.
- Many of the bonds can be called at a premium declining over time to par
value. Some bonds may be called earlier at par for extraordinary reasons.
- 100% of the bonds are insured by insurance companies that guarantee timely
payments of principal and interest on the bonds (but not Fund units or the
market value of the bonds before they mature).
The Portfolio consists of municipal bonds of the following types:
<TABLE>
<CAPTION>
APPROXIMATE
PORTFOLIO
PERCENTAGE
<S> <C>
/ /Hospitals/Health Care 20%
/ /Municipal Water/Sewer Utilities 20%
/ /Refunded Bonds 18%
/ /Special Tax 29%
/ /Municipal Electric Utilities 13%
</TABLE>
4. WHAT ARE THE SIGNIFICANT RISKS?
YOU CAN LOSE MONEY BY INVESTING IN THE FUND. THIS CAN HAPPEN FOR VARIOUS
REASONS, INCLUDING:
- Rising interest rates, an issuer's worsening financial condition or a drop in
bond ratings can reduce the price of your units.
- Because the Fund is concentrated in special tax bonds, adverse developments
in this sector may affect the value of your units.
- Assuming no changes in interest rates, when you sell your units, they will
generally be worth less than your cost because your cost included a sales
fee.
- The Fund will receive early returns of principal if bonds are called or sold
before they mature. If this happens your income will decline and you may not
be able to reinvest the money you receive at as high a yield or as long a
maturity.
ALSO, THE PORTFOLIO IS CONCENTRATED IN BONDS OF CALIFORNIA SO IT IS LESS
DIVERSIFIED THAN A NATIONAL FUND AND IS SUBJECT TO RISKS PARTICULAR TO
CALIFORNIA WHICH ARE BRIEFLY DESCRIBED UNDER STATE CONCENTRATION RISKS LATER
IN THIS PROSPECTUS.
3
<PAGE>
5. IS THIS FUND APPROPRIATE FOR YOU?
Yes, if you want federally tax-free income. You will benefit from a
professionally selected and supervised portfolio whose risk is reduced by
investing in insured bonds of several different issuers.
The Fund is NOT appropriate for you if you want a speculative investment that
changes to take advantage of market movements, if you do not want a
tax-advantaged investment or if you cannot tolerate any risk.
DEFINING YOUR INCOME
<TABLE>
<S> <C>
WHAT YOU MAY EXPECT (Payable on the 25th day of
the month to holders of record on the 10th day of
the month):
Regular Monthly Income per unit $4.52
Annual Income per unit: $54.30
THESE FIGURES ARE ESTIMATES DETERMINED ON THE EVALUATION
DAY; ACTUAL PAYMENTS MAY VARY.
</TABLE>
6. WHAT ARE THE FUND'S FEES AND EXPENSES?
This table shows the costs and expenses you may pay, directly or indirectly,
when you invest in the Fund.
<TABLE>
<S> <C>
INVESTOR FEES
Maximum Sales Fee (Load) on new
purchases (as a percentage of
$1,000 invested) 2.90%
</TABLE>
Employees of some of the Sponsors and their affiliates may pay a reduced
sales fee of no less than $5.00 per unit.
The maximum sales fee is reduced if you invest at least $100,000, as follows:
<TABLE>
<CAPTION>
YOUR MAXIMUM
SALES FEE
IF YOU INVEST: WILL BE:
-------------- ------------
<S> <C>
Less than $100,000 2.90%
$100,000 to $249,999 2.65%
$250,000 to $499,999 2.40%
$500,000 to $999,999 2.15%
$1,000,000 and over 1.90%
Maximum Exchange Fee 1.90%
</TABLE>
ESTIMATED ANNUAL FUND OPERATING EXPENSES
<TABLE>
<CAPTION>
AMOUNT
PER UNIT
--------
<S> <C>
Trustee's Fee $0.69
Portfolio Supervision,
Bookkeeping and
Administrative Fees
(including updating
expenses) $0.55
Evaluator's Fee $0.46
Other Operating Expenses $0.60
-----
TOTAL $2.30
</TABLE>
The Sponsors historically paid updating expenses.
7. HOW HAVE SIMILAR FUNDS PERFORMED IN THE PAST?
In the following chart we show past performance of prior California
Portfolios, which had investment objectives, strategies and types of bonds
substantially similar to this Fund. These prior Series differed in that they
charged a higher sales fee. These prior California Series were offered after
1987 and were outstanding on June 30, 2000. OF COURSE, PAST PERFORMANCE OF
PRIOR SERIES IS NO GUARANTEE OF FUTURE RESULTS OF THIS FUND.
AVERAGE ANNUAL COMPOUND TOTAL RETURNS
FOR PRIOR SERIES
REFLECTING ALL EXPENSES. FOR PERIODS ENDED 6/30/00.
<TABLE>
<CAPTION>
WITH SALES FEE NO SALES FEE
1 YEAR 5 YEARS 10 YEARS 1 YEAR 5 YEARS 10 YEARS
<S> <C> <C> <C> <C> <C> <C>
----------------------------------------------------------------------------
High 5.23% 5.37% 5.80% 5.64% 6.56% 6.30%
Average 0.98 4.35 5.55 3.01 5.41 6.12
Low -1.04 2.54 5.29 1.55 3.30 5.88
----------------------------------------------------------------------------
Average
Sales fee 2.05% 5.27% 5.65%
----------------------------------------------------------------------------
</TABLE>
NOTE: ALL RETURNS REPRESENT CHANGES IN UNIT PRICE WITH DISTRIBUTIONS REINVESTED
INTO THE MUNICIPAL FUND INVESTMENT ACCUMULATION PROGRAM.
8. IS THE FUND MANAGED?
Unlike a mutual fund, the Fund is not managed and bonds are not sold because
of market changes. Rather, experienced Defined Asset Funds financial analysts
regularly review the bonds in the Fund. The Fund may sell a bond if certain
adverse credit or other conditions exist.
4
<PAGE>
9. HOW DO I BUY UNITS?
The minimum investment is one unit.
You can buy units from any of the Sponsors and other broker-dealers. The
Sponsors are listed later in this prospectus. Some banks may offer units for
sale through special arrangements with the Sponsors, although certain legal
restrictions may apply.
<TABLE>
<S> <C>
UNIT PRICE PER UNIT $998.97
(as of May 31, 2000)
</TABLE>
Unit price is based on the net asset value of the Fund plus the sales fee. An
amount equal to any principal cash, as well as net accrued but undistributed
interest on the unit, is added to the unit price. An independent evaluator
prices the bonds at 3:30 p.m. Eastern time every business day. Unit price
changes every day with changes in the prices of the bonds in the Fund.
10. HOW DO I SELL UNITS?
You may sell your units at any time to any Sponsor or the Trustee for the net
asset value determined at the close of business on the date of sale. You will
not pay any other fee when you sell your units.
11. HOW ARE DISTRIBUTIONS MADE AND TAXED?
The Fund pays income monthly.
In the opinion of bond counsel when each bond was issued, interest on the
bonds in this Fund is generally 100% exempt from regular federal income tax.
Your income may also be exempt from some California state and local personal
income taxes if you live in California.
You will also receive principal payments if bonds are sold or called or
mature, when the cash available is more than $5.00 per unit. You will be
subject to tax on any gain realized by the Fund on the disposition of bonds.
12. WHAT OTHER SERVICES ARE AVAILABLE?
REINVESTMENT
You will receive your income in cash unless you choose to compound your
income by reinvesting at no sales fee in the Municipal Fund Investment
Accumulation Program, Inc. This program is an open-end mutual fund with a
comparable investment objective, but the bonds will generally not be insured.
Income from this program will generally be subject to state and local income
taxes. FOR MORE COMPLETE INFORMATION ABOUT THE PROGRAM, INCLUDING CHARGES AND
FEES, ASK THE TRUSTEE FOR THE PROGRAM'S PROSPECTUS. READ IT CAREFULLY BEFORE
YOU INVEST. THE TRUSTEE MUST RECEIVE YOUR WRITTEN ELECTION TO REINVEST AT
LEAST 10 DAYS BEFORE THE RECORD DAY OF AN INCOME PAYMENT.
EXCHANGE PRIVILEGES
You may exchange units of this Fund for units of certain other Defined Asset
Funds. You may also exchange into this Fund from certain other funds. We
charge a reduced sales fee on exchanges.
5
<PAGE>
--------------------------------------------------------------------------------
MARYLAND PORTFOLIO--RISK/RETURN SUMMARY
1. WHAT IS THE FUND'S OBJECTIVE?
The Fund seeks interest income that is exempt from regular federal income
taxes and some state and local taxes by investing in a fixed portfolio
consisting primarily of long term municipal revenue bonds.
2. WHAT ARE MUNICIPAL REVENUE BONDS?
Municipal revenue bonds are bonds issued by states, municipalities and public
authorities to finance the cost of buying, building or improving various
projects intended to generate revenue, such as airports, health care
facilities, housing and municipal electric, water and sewer utilities.
Generally, payments on these bonds depend solely on the revenues generated by
the projects, excise taxes or state appropriations, and are not backed by the
government's taxing power.
3. WHAT IS THE FUND'S INVESTMENT STRATEGY?
- The Fund plans to hold to maturity 8 long-term tax-exempt municipal bonds
with an aggregate face amount of $2,860,000.
- The Fund is a unit investment trust which means that, unlike a mutual fund,
the Portfolio is not managed.
- When the bonds were initially deposited they were rated A or better by
Standard & Poor's, Moody's or Fitch. THE QUALITY OF THE BONDS MAY CURRENTLY
BE LOWER.
- Many of the bonds can be called at a premium declining over time to par
value. Some bonds may be called earlier at par for extraordinary reasons.
- 53% of the bonds are insured by insurance companies that guarantee timely
payments of principal and interest on the bonds (but not Fund units or the
market value of the bonds before they mature).
The Portfolio consists of municipal bonds of the following types:
<TABLE>
<CAPTION>
APPROXIMATE
PORTFOLIO
PERCENTAGE
<S> <C>
/ /Airports/Ports/Highways 1%
/ /General Obligation 28%
/ /Hospitals/Health Care 38%
/ /Industrial Development Revenue 33%
</TABLE>
4. WHAT ARE THE SIGNIFICANT RISKS?
YOU CAN LOSE MONEY BY INVESTING IN THE FUND. THIS CAN HAPPEN FOR VARIOUS
REASONS, INCLUDING:
- Rising interest rates, an issuer's worsening financial condition or a drop in
bond ratings can reduce the price of your units.
- Because the Fund is concentrated in hospital/health care, general obligation
and industrial development revenue bonds, adverse developments in these
sectors may affect the value of your units.
- Assuming no changes in interest rates, when you sell your units, they will
generally be worth less than your cost because your cost included a sales
fee.
- The Fund will receive early returns of principal if bonds are called or sold
before they mature. If this happens your income will decline and you may not
be able to reinvest the money you receive at as high a yield or as long a
maturity.
ALSO, THE PORTFOLIO IS CONCENTRATED IN BONDS OF MARYLAND SO IT IS LESS
DIVERSIFIED THAN A NATIONAL FUND AND IS SUBJECT TO RISKS PARTICULAR TO
MARYLAND WHICH ARE BRIEFLY DESCRIBED UNDER STATE CONCENTRATION RISKS LATER IN
THIS PROSPECTUS.
6
<PAGE>
5. IS THIS FUND APPROPRIATE FOR YOU?
Yes, if you want federally tax-free income. You will benefit from a
professionally selected and supervised portfolio whose risk is reduced by
investing in bonds of several different issuers.
The Fund is NOT appropriate for you if you want a speculative investment that
changes to take advantage of market movements, if you do not want a
tax-advantaged investment or if you cannot tolerate any risk.
DEFINING YOUR INCOME
<TABLE>
<S> <C>
What You May Expect (Payable on the 25th day of
the month to holders of record on the 10th day of
the month):
Regular Monthly Income per unit $4.52
Annual Income per unit: $54.32
THESE FIGURES ARE ESTIMATES DETERMINED ON THE EVALUATION
DAY; ACTUAL PAYMENTS MAY VARY.
</TABLE>
6. WHAT ARE THE FUND'S FEES AND EXPENSES?
This table shows the costs and expenses you may pay, directly or indirectly,
when you invest in the Fund.
<TABLE>
<S> <C>
INVESTOR FEES
Maximum Sales Fee (Load) on new
purchases (as a percentage of
$1,000 invested) 2.90%
</TABLE>
Employees of some of the Sponsors and their affiliates may be charged a
reduced sales fee of no less than $5.00 per unit.
The maximum sales fee is reduced if you invest at least $100,000, as follows:
<TABLE>
<CAPTION>
YOUR MAXIMUM
SALES FEE
IF YOU INVEST: WILL BE:
-------------- ------------
<S> <C>
Less than $100,000 2.90%
$100,000 to $249,999 2.65%
$250,000 to $499,999 2.40%
$500,000 to $999,999 2.15%
$1,000,000 and over 1.90%
Maximum Exchange Fee 1.90%
</TABLE>
ESTIMATED ANNUAL FUND OPERATING EXPENSES
<TABLE>
<CAPTION>
AMOUNT
PER UNIT
--------
<S> <C>
Trustee's Fee $0.69
Portfolio Supervision,
Bookkeeping and
Administrative Fees
(including updating
expenses) $0.55
Evaluator's Fee $0.43
Other Operating Expenses $0.52
-----
TOTAL $2.19
</TABLE>
The Sponsors historically paid updating expenses.
7. HOW HAVE SIMILAR FUNDS PERFORMED IN THE PAST?
IN THE FOLLOWING CHART WE SHOW PAST PERFORMANCE OF PRIOR MARYLAND PORTFOLIOS,
WHICH HAD INVESTMENT OBJECTIVES, STRATEGIES AND TYPES OF BONDS SUBSTANTIALLY
SIMILAR TO THIS FUND. THESE PRIOR SERIES DIFFERED IN THAT THEY CHARGED A
HIGHER SALES FEE. These prior Maryland Series were offered between after 1987
and were outstanding on June 30, 2000. OF COURSE, PAST PERFORMANCE OF PRIOR
SERIES IS NO GUARANTEE OF FUTURE RESULTS OF THIS FUND.
AVERAGE ANNUAL COMPOUND TOTAL RETURNS
FOR PRIOR SERIES
REFLECTING ALL EXPENSES. FOR PERIODS ENDED 6/30/00.
<TABLE>
<CAPTION>
WITH SALES FEE NO SALES FEE
1 YEAR 5 YEARS 1 YEAR 5 YEARS
<S> <C> <C> <C> <C>
--------------------------------------------------------
High 2.70% 5.19% 3.73% 6.37%
Average 0.21 3.94 2.05 4.94
Low -4.52 2.88 -1.82 3.88
--------------------------------------------------------
Average
Sales fee 1.86% 4.98%
--------------------------------------------------------
</TABLE>
NOTE: ALL RETURNS REPRESENT CHANGES IN UNIT PRICE WITH DISTRIBUTIONS REINVESTED
INTO THE MUNICIPAL FUND INVESTMENT ACCUMULATION PROGRAM.
8. IS THE FUND MANAGED?
Unlike a mutual fund, the Fund is not managed and bonds are not sold because
of market changes. Rather, experienced Defined Asset Funds financial analysts
regularly review the bonds in the Fund. The Fund may sell a bond if certain
adverse credit or other conditions exist.
7
<PAGE>
9. HOW DO I BUY UNITS?
The minimum investment is one unit.
You can buy units from any of the Sponsors and other broker-dealers. The
Sponsors are listed later in this prospectus. Some banks may offer units for
sale through special arrangements with the Sponsors, although certain legal
restrictions may apply.
<TABLE>
<S> <C>
UNIT PRICE PER UNIT $977.68
(as of May 31, 2000)
</TABLE>
Unit price is based on the net asset value of the Fund plus the sales fee. An
amount equal to any principal cash, as well as net accrued but undistributed
interest on the unit, is added to the unit price. An independent evaluator
prices the bonds at 3:30 p.m. Eastern time every business day. Unit price
changes every day with changes in the prices of the bonds in the Fund.
10. HOW DO I SELL UNITS?
You may sell your units at any time to any Sponsor or the Trustee for the net
asset value determined at the close of business on the date of sale. You will
not pay any other fee when you sell your units.
11. HOW ARE DISTRIBUTIONS MADE AND TAXED?
The Fund pays income monthly.
In the opinion of bond counsel when each bond was issued, interest on the
bonds in this Fund is generally 100% exempt from regular federal income tax.
Your income may also be exempt from some Maryland state and local personal
income taxes if you live in Maryland.
You will also receive principal payments if bonds are sold or called or
mature, when the cash available is more than $5.00 per unit. You will be
subject to tax on any gain realized by the Fund on the disposition of bonds.
12. WHAT OTHER SERVICES ARE AVAILABLE?
REINVESTMENT
You will receive your income in cash unless you choose to compound your
income by reinvesting at no sales fee in the Municipal Fund Investment
Accumulation Program, Inc. This program is an open-end mutual fund with a
comparable investment objective. Income from this program will generally be
subject to state and local income taxes. FOR MORE COMPLETE INFORMATION ABOUT
THE PROGRAM, INCLUDING CHARGES AND FEES, ASK THE TRUSTEE FOR THE PROGRAM'S
PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST. THE TRUSTEE MUST RECEIVE
YOUR WRITTEN ELECTION TO REINVEST AT LEAST 10 DAYS BEFORE THE RECORD DAY OF
AN INCOME PAYMENT.
EXCHANGE PRIVILEGES
You may exchange units of this Fund for units of certain other Defined Asset
Funds. You may also exchange into this Fund from certain other funds. We
charge a reduced sales fee on exchanges.
8
<PAGE>
--------------------------------------------------------------------------------
NEW JERSEY INSURED PORTFOLIO--RISK/RETURN SUMMARY
1. WHAT IS THE FUND'S OBJECTIVE?
The Fund seeks interest income that is exempt from regular federal income
taxes and some state and local taxes by investing in a fixed portfolio
consisting primarily of insured, long term municipal revenue bonds.
2. WHAT ARE MUNICIPAL REVENUE BONDS?
Municipal revenue bonds are bonds issued by states, municipalities and public
authorities to finance the cost of buying, building or improving various
projects intended to generate revenue, such as airports, health care
facilities, housing and municipal electric, water and sewer utilities.
Generally, payments on these bonds depend solely on the revenues generated by
the projects, excise taxes or state appropriations, and are not backed by the
government's taxing power.
3. WHAT IS THE FUND'S INVESTMENT STRATEGY?
- The Fund plans to hold to maturity 7 long-term tax-exempt municipal bonds
with an aggregate face amount of $2,100,000.
- The Fund is a unit investment trust which means that, unlike a mutual fund,
the Portfolio is not managed.
- The bonds are rated AAA or Aaa by Standard & Poor's, Moody's or Fitch.
- Many of the bonds can be called at a premium declining over time to par
value. Some bonds may be called earlier at par for extraordinary reasons.
- 100% of the bonds are insured by insurance companies that guarantee timely
payments of principal and interest on the bonds (but not Fund units or the
market value of the bonds before they mature).
The Portfolio consists of municipal bonds of the following types:
<TABLE>
<CAPTION>
APPROXIMATE
PORTFOLIO
PERCENTAGE
<S> <C>
/ /Hospitals/Health Care 19%
/ /Industrial Development Revenue 20%
/ /Miscellaneous 12%
/ /Municipal Water/Sewer Utilities 15%
/ /Refunded Bonds 20%
/ /Universities/Colleges 14%
</TABLE>
4. WHAT ARE THE SIGNIFICANT RISKS?
YOU CAN LOSE MONEY BY INVESTING IN THE FUND. THIS CAN HAPPEN FOR VARIOUS
REASONS, INCLUDING:
- Rising interest rates, an issuer's worsening financial condition or a drop in
bond ratings can reduce the price of your units.
- Assuming no changes in interest rates, when you sell your units, they will
generally be worth less than your cost because your cost included a sales
fee.
- The Fund will receive early returns of principal if bonds are called or sold
before they mature. If this happens your income will decline and you may not
be able to reinvest the money you receive at as high a yield or as long a
maturity.
ALSO, THE PORTFOLIO IS CONCENTRATED IN BONDS OF NEW JERSEY SO IT IS LESS
DIVERSIFIED THAN A NATIONAL FUND AND IS SUBJECT TO RISKS PARTICULAR TO NEW
JERSEY WHICH ARE BRIEFLY DESCRIBED UNDER STATE CONCENTRATION RISKS LATER IN
THIS PROSPECTUS.
9
<PAGE>
5. IS THIS FUND APPROPRIATE FOR YOU?
Yes, if you want federally tax-free income. You will benefit from a
professionally selected and supervised portfolio whose risk is reduced by
investing in insured bonds of several different issuers.
The Fund is NOT appropriate for you if you want a speculative investment that
changes to take advantage of market movements, if you do not want a
tax-advantaged investment or if you cannot tolerate any risk.
DEFINING YOUR INCOME
<TABLE>
<S> <C>
What You May Expect (Payable on the 25th day of
the month to holders of record on the 10th day of
the month):
Regular Monthly Income per unit $4.43
Annual Income per unit: $53.19
THESE FIGURES ARE ESTIMATES DETERMINED ON THE EVALUATION
DAY; ACTUAL PAYMENTS MAY VARY.
</TABLE>
6. WHAT ARE THE FUND'S FEES AND EXPENSES?
This table shows the costs and expenses you may pay, directly or indirectly,
when you invest in the Fund.
<TABLE>
<S> <C>
INVESTOR FEES
Maximum Sales Fee (Load) on new
purchases (as a percentage of
$1,000 invested) 2.90%
</TABLE>
Employees of some of the Sponsors and their affiliates may pay a reduced
sales fee of no less than $5.00 per unit.
The maximum sales fee is reduced if you invest at least $100,000, as follows:
<TABLE>
<CAPTION>
YOUR MAXIMUM
SALES FEE
IF YOU INVEST: WILL BE:
-------------- ------------
<S> <C>
Less than $100,000 2.90%
$100,000 to $249,999 2.65%
$250,000 to $499,999 2.40%
$500,000 to $999,999 2.15%
$1,000,000 and over 1.90%
Maximum Exchange Fee 1.90%
</TABLE>
ESTIMATED ANNUAL FUND OPERATING EXPENSES
<TABLE>
<CAPTION>
AMOUNT
PER UNIT
--------
<S> <C>
Trustee's Fee $0.70
Portfolio Supervision,
Bookkeeping and
Administrative Fees
(including updating
expenses) $0.55
Evaluator's Fee $0.44
Other Operating Expenses $0.94
-----
TOTAL $2.63
</TABLE>
The Sponsors historically paid updating expenses.
7. HOW HAVE SIMILAR FUNDS PERFORMED IN THE PAST?
IN THE FOLLOWING CHART WE SHOW PAST PERFORMANCE OF PRIOR NEW JERSEY
PORTFOLIOS, WHICH HAD INVESTMENT OBJECTIVES, STRATEGIES AND TYPES OF BONDS
SUBSTANTIALLY SIMILAR TO THIS FUND. THESE PRIOR SERIES DIFFERED IN THAT THEY
CHARGED A HIGHER SALES FEE. These prior New Jersey Series were offered after
1987 and were outstanding on June 30, 2000. OF COURSE, PAST PERFORMANCE OF
PRIOR SERIES IS NO GUARANTEE OF FUTURE RESULTS OF THIS FUND.
AVERAGE ANNUAL COMPOUND TOTAL RETURNS
FOR PRIOR SERIES
REFLECTING ALL EXPENSES. FOR PERIODS ENDED 6/30/00.
<TABLE>
<CAPTION>
WITH SALES FEE NO SALES FEE
1 YEAR 5 YEARS 1 YEAR 5 YEARS
<S> <C> <C> <C> <C>
--------------------------------------------------------
High 3.82% 5.02% 4.72% 6.19%
Average 0.82 4.15 2.80 5.24
Low -2.37 2.38 0.51 3.17
--------------------------------------------------------
Average
Sales fee 2.00% 5.44%
--------------------------------------------------------
</TABLE>
NOTE: ALL RETURNS REPRESENT CHANGES IN UNIT PRICE WITH DISTRIBUTIONS REINVESTED
INTO THE MUNICIPAL FUND INVESTMENT ACCUMULATION PROGRAM.
8. IS THE FUND MANAGED?
Unlike a mutual fund, the Fund is not managed and bonds are not sold because
of market changes. Rather, experienced Defined Asset Funds financial analysts
regularly review the bonds in the Fund. The Fund may sell a bond if certain
adverse credit or other conditions exist.
10
<PAGE>
9. HOW DO I BUY UNITS?
The minimum investment is one unit.
You can buy units from any of the Sponsors and other broker-dealers. The
Sponsors are listed later in this prospectus. Some banks may offer units for
sale through special arrangements with the Sponsors, although certain legal
restrictions may apply.
<TABLE>
<S> <C>
UNIT PRICE PER UNIT $978.23
(as of May 31, 2000)
</TABLE>
Unit price is based on the net asset value of the Fund plus the sales fee. An
amount equal to any principal cash, as well as net accrued but undistributed
interest on the unit, is added to the unit price. An independent evaluator
prices the bonds at 3:30 p.m. Eastern time every business day. Unit price
changes every day with changes in the prices of the bonds in the Fund.
10. HOW DO I SELL UNITS?
You may sell your units at any time to any Sponsor or the Trustee for the net
asset value determined at the close of business on the date of sale. You will
not pay any other fee when you sell your units.
11. HOW ARE DISTRIBUTIONS MADE AND TAXED?
The Fund pays income monthly.
In the opinion of bond counsel when each bond was issued, interest on the
bonds in this Fund is generally 100% exempt from regular federal income tax.
Your income may also be exempt from some New Jersey state and local personal
income taxes if you live in New Jersey.
You will also receive principal payments if bonds are sold or called or
mature, when the cash available is more than $5.00 per unit. You will be
subject to tax on any gain realized by the Fund on the disposition of bonds.
12. WHAT OTHER SERVICES ARE AVAILABLE?
REINVESTMENT
You will receive your income in cash unless you choose to compound your
income by reinvesting at no sales fee in the Municipal Fund Investment
Accumulation Program, Inc. This program is an open-end mutual fund with a
comparable investment objective, but the bonds generally will not be insured.
Income from this program will generally be subject to state and local income
taxes. FOR MORE COMPLETE INFORMATION ABOUT THE PROGRAM, INCLUDING CHARGES AND
FEES, ASK THE TRUSTEE FOR THE PROGRAM'S PROSPECTUS. READ IT CAREFULLY BEFORE
YOU INVEST. THE TRUSTEE MUST RECEIVE YOUR WRITTEN ELECTION TO REINVEST AT
LEAST 10 DAYS BEFORE THE RECORD DAY OF AN INCOME PAYMENT.
EXCHANGE PRIVILEGES
You may exchange units of this Fund for units of certain other Defined Asset
Funds. You may also exchange into this Fund from certain other funds. We
charge a reduced sales fee on exchanges.
11
<PAGE>
--------------------------------------------------------------------------------
TAX-FREE VS. TAXABLE INCOME: A COMPARISON OF TAXABLE AND TAX-FREE YIELDS
FOR CALIFORNIA RESIDENTS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COMBINED
EFFECTIVE
TAXABLE INCOME 2000* TAX RATE TAX-FREE YIELD OF
SINGLE RETURN JOINT RETURN % 3% 3.5% 4% 4.5% 5% 5.5% 6% 6.5% 7% 7.5% 8%
IS EQUIVALENT TO A TAXABLE YIELD OF
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
----------------------------------------------------------------------------------------------------------------------------------
$ 0- 26,250 $ $0- 43,050 20.10 3.75 4.38 5.01 5.63 6.26 6.88 7.51 8.14 8.76 9.39 10.01
$ 26,251- 63,550 $ 43,851-105,950 34.70 4.59 5.36 6.13 6.89 7.66 8.42 9.19 9.95 10.72 11.48 12.25
$ 63,551-132,600 $105,951-161,450 37.42 4.79 5.59 6.39 7.19 7.99 8.79 9.59 10.39 11.19 11.98 12.78
$132,601-288,350 $161,451-288,350 41.95 5.17 6.03 6.89 7.75 8.61 9.47 10.34 11.20 12.06 12.92 13.78
OVER $288,350 OVER $288,350 45.22 5.48 6.39 7.30 8.21 9.13 10.04 10.95 11.87 12.78 13.69 14.60
</TABLE>
FOR MARYLAND RESIDENTS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COMBINED
EFFECTIVE
TAXABLE INCOME 2000* TAX RATE TAX-FREE YIELD OF
SINGLE RETURN JOINT RETURN % 4% 4.5% 5% 5.5% 6% 6.5% 7% 7.5% 8%
IS EQUIVALENT TO A TAXABLE YIELD OF
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
------------------------------------------------------------------------------------------------------------------
$ 0- 26,250 $ 0- 43,850 19.12 4.95 5.56 6.18 6.80 7.42 8.04 8.66 9.27 9.89
$ 26,250- 63,550 $ 43,850-105,950 31.49 5.84 6.57 7.30 8.03 8.76 9.49 10.22 10.95 11.68
$ 63,550-132,600 $105,950-161,450 34.35 6.09 6.85 7.62 8.38 9.14 9.90 10.66 11.42 12.19
$132,600-288,350 $161,450-288,450 39.10 6.57 7.39 8.21 9.03 9.85 10.67 11.50 12.32 13.14
OVER $288,350 OVER $288,350 42.53 6.96 7.83 8.70 9.57 10.44 11.31 12.18 13.05 13.92
</TABLE>
FOR NEW JERSEY RESIDENTS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COMBINED
EFFECTIVE
TAXABLE INCOME 2000* TAX RATE TAX-FREE YIELD OF
SINGLE RETURN JOINT RETURN % 4% 4.5% 5% 5.5% 6% 6.5% 7% 7.5% 8%
IS EQUIVALENT TO A TAXABLE YIELD OF
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
------------------------------------------------------------------------------------------------------------------
$ 0- 26,250 $ $0- 43,850 16.49 4.79 5.39 5.99 6.59 7.18 7.78 8.38 8.98 9.58
$ 26,251- 63,550 $ 43,851-105,950 31.98 5.88 6.62 7.35 8.09 8.82 9.56 10.29 11.03 11.76
$ 63,551-132,600 $105,951-161,450 35.40 6.19 6.97 7.74 8.51 9.29 10.06 10.84 11.61 12.38
$132,601-288,350 $161,451-288,350 40.08 6.68 7.51 8.34 9.18 10.01 10.85 11.68 12.52 13.35
OVER $288,350 OVER $288,350 43.45 7.07 7.96 8.84 9.73 10.61 11.49 12.38 13.26 14.15
</TABLE>
To compare the yield of a taxable security with the yield of a tax-free
security, find your taxable income and read across. The table incorporates 2000
federal and applicable State income tax rates and assumes that all income would
otherwise be taxed at the investor's highest tax rate. Yield figures are for
example only.
*Based upon net amount subject to federal income tax after deductions and
exemptions. This table does not reflect the possible effect of other tax
factors, such as alternative minimum tax, personal exemptions, the phase out of
exemptions, itemized deductions or the possible partial disallowance of
deductions. Consequently, you should consult your own tax advisers in this
regard.
12
<PAGE>
WHAT YOU CAN EXPECT FROM YOUR INVESTMENT
MONTHLY INCOME
The Fund will pay you regular monthly income. Your monthly income may vary
because of:
- elimination of one or more bonds from the Fund's portfolio because of calls,
redemptions or sales;
- a change in the Fund's expenses; or
- the failure by a bond's issuer to pay interest.
Changes in interest rates generally will not affect your income because the
portfolio is fixed.
Along with your income, you will receive your share of any available bond
principal.
RETURN FIGURES
We cannot predict your actual return, which will vary with unit price, how long
you hold your investment and changes in the portfolio, interest income and
expenses.
ESTIMATED CURRENT RETURN equals the estimated annual cash to be received from
the bonds in the Fund less estimated annual Fund expenses, divided by the Unit
Price (including the maximum sales fee):
<TABLE>
<S> <C><C>
Estimated Annual Estimated
Interest Income - Annual Expenses
------------------------------------
Unit Price
</TABLE>
ESTIMATED LONG TERM RETURN is a measure of the estimated return over the
estimated life of the Fund. Unlike Estimated Current Return, Estimated Long Term
Return reflects maturities, discounts and premiums of the bonds in the Fund. It
is an average of the yields to maturity (or in certain cases, to an earlier call
date) of the individual bonds in the portfolio, adjusted to reflect the Fund's
maximum sales fee and estimated expenses. We calculate the average yield for the
portfolio by weighting each bond's yield by its market value and the time
remaining to the call or maturity date.
Yields on individual bonds depend on many factors including general conditions
of the bond markets, the size of a particular offering and the maturity and
quality rating of the particular issues. Yields can vary among bonds with
similar maturities, coupons and ratings.
These return quotations are designed to be comparative rather than predictive.
RECORDS AND REPORTS
You will receive:
- a monthly statement of income payments and any principal payments;
- a notice from the Trustee when new bonds are deposited in exchange or
substitution for bonds originally deposited;
- an annual report on Fund activity; and
- annual tax information. THIS WILL ALSO BE SENT TO THE IRS. YOU MUST REPORT THE
AMOUNT OF TAX-EXEMPT INTEREST RECEIVED DURING THE YEAR.
You may request:
- copies of bond evaluations to enable you to comply with federal and state tax
reporting requirements; and
- audited financial statements of the Fund.
You may inspect records of Fund transactions at the Trustee's office during
regular business hours.
13
<PAGE>
THE RISKS YOU FACE
INTEREST RATE RISK
Investing involves risks, including the risk that your investment will decline
in value if interest rates rise. Generally, bonds with longer maturities will
change in value more than bonds with shorter maturities. Bonds in the Fund are
more likely to be called when interest rates decline. This would result in early
returns of principal to you and may result in early termination of the Fund. Of
course, we cannot predict how interest rates may change.
CALL RISK
Many bonds can be prepaid or "called" by the issuer before their stated
maturity.
For example, some bonds may be required to be called pursuant to mandatory
sinking fund provisions.
Also, an issuer might call its bonds during periods of falling interest rates,
if the issuer's bonds have a coupon higher than current market rates.
An issuer might call its bonds in extraordinary cases, including if:
- it no longer needs the money for the original purpose;
- the project is condemned or sold;
- the project is destroyed and insurance proceeds are used to redeem the
bonds;
- any related credit support expires and is not replaced; or
- interest on the bonds become taxable.
If the bonds are called, your income will decline and you may not be able to
reinvest the money you receive at as high a yield or as long a maturity. An
early call at par of a premium bond will reduce your return.
REDUCED DIVERSIFICATION RISK
If many investors sell their units, the Fund will have to sell bonds. This could
reduce the diversification of your investment and increase your share of Fund
expenses.
LIQUIDITY RISK
You can always sell back your units, but we cannot assure you that a liquid
trading market will always exist for the bonds in the portfolio, especially
since current law may restrict the Fund from selling bonds to any Sponsor. The
bonds will generally trade in the over-the-counter market. The value of the
bonds, and of your investment, may be reduced if trading in bonds is limited or
absent.
CONCENTRATION RISK
When a certain type of bond makes up 25% or more of the portfolio, it is said to
be "concentrated" in that bond type, which makes the Portfolio less diversified.
Here is what you should know about the California Portfolio's concentration in
special tax bonds. Special tax bonds are payable from and secured by the
revenues a municipality derives from a particular tax; for example, a tax on
hotel rentals, on the purchase of food and beverages, car rentals, or liquor
consumption. These bonds are not secured by general tax revenues. Payment on
these bonds may be adversely affected by:
- a reduction in revenues resulting from a decline in the local economy or
population; or
14
<PAGE>
- a decline in the consumption, use or cost of the goods and services that are
subject to taxation.
Here is what you should know about the Maryland Portfolio's concentration in
hospital and health care bonds.
- payment for these bonds depends on revenues from private third-party payors
and government programs, including Medicare and Medicaid, which have
generally undertaken cost containment measures to limit payments to health
care providers;
- hospitals face increasing competition resulting from hospital mergers and
affiliations;
- hospitals need to reduce costs as HMOs increase market penetration and
hospital supply and drug companies raise prices;
- hospitals and health care providers are subject to various legal claims by
patients and others and are adversely affected by increasing costs of
insurance; and
- many hospitals are aggressively buying physician practices and assuming risk
contracts to gain market share. If revenues do not increase accordingly,
this practice could reduce profits;
- Medicare is changing its reimbursement system for nursing homes. Many
nursing home providers are not sure how they will be treated. In many cases,
the providers may receive lower reimbursements and these would have to cut
expenses to maintain profitability; and
- most retirement/nursing home providers rely on entrance fees for operating
revenues. If people live longer than expected and turnover is lower than
budgeted, operating revenues would be adversely affected by less than
expected entrance fees.
Here is what you should know about the Maryland Portfolio's concentration in
industrial development revenue bonds (IDRs). IDRs are issued to finance various
privately operated projects such as pollution control and manufacturing
facilities. Payment for these bonds depends on:
- creditworthiness of the corporate operator of the project being financed;
- economic factors relating to the particular industry; and,
- in some cases, creditworthiness of an affiliated or third-party guarantor.
Here is what you should know about the Maryland Portfolio's concentration in
general obligation bonds.
- general obligation bonds are backed by the issuer's pledge of its full
faith, credit and taxing power;
- but the taxing power of any government issuer may be limited by provisions
of the state constitution or laws as well as political considerations; and
- an issuer's credit can be negatively affected by various factors, including
population decline that erodes the tax base, natural disasters, decline in
industry, limited access to capital markets or heavy reliance on state or
federal aid.
Changes to the portfolio from bond redemptions, maturities and sales may affect
the Fund's concentrations over time.
15
<PAGE>
STATE CONCENTRATION RISK
CALIFORNIA RISK
GENERALLY
From the late 1980s through the early 1990s, an economic recession eroded
California's revenue base. At the same time rapid population growth caused State
expenditures to exceed budget appropriations.
- As a result California experienced a period of sustained budget imbalance.
- Since that time the California economy has improved markedly and the extreme
budgetary pressures have begun to lessen.
STATE GOVERNMENT
The 1999-2000 Budget Act allocated a State budget of approximately $63.7 Billion
and contains no tax increases or reductions. Despite this somewhat improved
state, California's budget is still subject to certain unforeseeable events. For
example:
- In December, 1994, Orange County and its investment pool filed for
bankruptcy. While a settlement has been reached, the full impact on the
State and Orange County remains unknown.
- California faces constant fluctuations in other expenses (including health
and welfare caseloads, property tax receipts, federal funding and natural
disaster relief) that will undoubtedly create new budgetary pressure and
reduce ability to pay their debts.
- California's general obligation bonds are currently rated AA3 by Moody's and
AA- by Standard & Poor's.
OTHER RISKS
Issuers' ability to make payments on bonds (and the remedies available to
bondholders) could also be adversely affected by the following constraints:
- Certain provisions of California's Constitution, laws and regulatory system
contain tax, spending and appropriations limits and prohibit certain new
taxes.
- Certain other California laws subject the users of bond proceeds to strict
rules and limits regarding revenue repayment.
- Bonds of healthcare institutions which are subject to the strict rules and
limits regarding reimbursement payments of California's Medi-Cal program for
health care services to welfare recipients and bonds secured by liens on
real property are two of the types of bonds that could be affected by these
provisions.
MARYLAND RISKS
GENERALLY
The Maryland economy is affected by various economic, social and environmental
conditions, some of which are unique to the state and others which affect the
nation as a whole and the Mid-Atlantic region in particular. For example:
- many residents of the state work for the Federal government in and around
Washington, D.C. Cutbacks in federal spending hurt Maryland more than other
states;
- like those in other states, Maryland businesses are sensitive to changes in
Federal regulation, which can affect
16
<PAGE>
their revenues and, therefore, state tax revenue;
- Maryland has lost many defense and construction jobs in recent years, as its
economy has shifted away from manufacturing and industry and towards
services;
- the state's tax base has eroded as the population has dropped in cities such
as Baltimore.
The state and its local governments are limited in their ability to increase or
impose new taxes or incur indebtedness, which could hurt their ability to meet
debt obligations.
The state's general obligations are rated Aaa by Moody's and AAA by Standard &
Poor's.
NEW JERSEY RISKS
STATE AND LOCAL GOVERNMENT
Certain features of New Jersey law could affect the repayment of debt:
- the State of New Jersey and its agencies and public authorities issue
general obligation bonds, which are secured by the full faith and credit of
the state, backed by its taxing authority, without recourse to specific
sources of revenue, therefore, any liability to increase taxes could impair
the state's ability to repay debt; and
- the state is required by law to maintain a balanced budget, and state
spending for any given municipality or county cannot increase by more than
5% per year. This limit could make it harder for any particular county or
municipality to repay its debts.
In recent years the state budget's main expenditures have been
- elementary and secondary education, and
- state agencies and programs, including police and corrections facilities,
higher education, and environmental protection.
The state's general obligations are rated Aa1 by Moody's and AA+ by Standard &
Poor's.
BOND QUALITY RISK
A reduction in a bond's rating may decrease its value and, indirectly, the value
of your investment in the Fund.
INSURANCE RELATED RISK
Some bonds are backed by insurance companies (as shown under Portfolios).
Insurance policies generally make payments only according to a bond's original
payment schedule and do not make early payments when a bond defaults or becomes
taxable. Although the federal government does not regulate the insurance
business, various state laws and federal initiatives and tax law changes could
significantly affect the insurance business. The claims-paying ability of the
insurance companies is generally rated A or better by Standard & Poor's or
another nationally recognized rating organization. The insurance company ratings
are subject to change at any time at the discretion of the rating agencies.
LITIGATION AND LEGISLATION RISKS
We do not know of any pending litigation that might have a material adverse
effect upon the Fund.
17
<PAGE>
Future tax legislation could affect the value of the portfolio by:
- limiting real property taxes,
- reducing tax rates,
- imposing a flat or other form of tax, or
- exempting investment income from tax.
SELLING OR EXCHANGING UNITS
You can sell your units at any time for a price based on net asset value. Your
net asset value is calculated each business day by:
- ADDING the value of the bonds, net accrued interest, cash and any other Fund
assets;
- SUBTRACTING accrued but unpaid Fund expenses, unreimbursed Trustee advances,
cash held to buy back units or for distribution to investors and any other
Fund liabilities; and
- DIVIDING the result by the number of outstanding units.
Your net asset value when you sell may be more or less than your cost because of
sales fees, market movements and changes in the portfolio.
SPONSORS' SECONDARY MARKET
While we are not obligated to do so, we will buy back units at net asset value
without any other fee or charge. We may resell the units to other buyers or to
the Trustee. You should consult your financial professional for current market
prices to determine if other broker-dealers or banks are offering higher prices.
We have maintained the secondary market continuously for over 28 years, but we
could discontinue it without prior notice for any business reason.
SELLING UNITS TO THE TRUSTEE
Regardless of whether we maintain a secondary market, you can sell your units to
the Trustee at any time by sending the Trustee a letter (with any outstanding
certificates if you hold Unit certificates). You must properly endorse your
certificates (or execute a written transfer instrument with signatures
guaranteed by an eligible institution). Sometimes, additional documents are
needed such as a trust document, certificate of corporate authority, certificate
of death or appointment as executor, administrator or guardian.
Within seven days after your request and the necessary documents are received,
the Trustee will mail a check to you. Contact the Trustee for additional
information.
As long as we are maintaining a secondary market, the Trustee will sell your
units to us at a price based on net asset value. If there is no secondary
market, the Trustee may sell your units in the over-the-counter market for a
higher price, but it is not obligated to do so. In that case, you will receive
the net proceeds of the sale.
If the Fund does not have cash available to pay you for units you are selling,
the agent for the Sponsors will select bonds to be sold. Bonds will be selected
based on market and credit factors. These sales could be made at times when the
bonds would not otherwise be sold and may result in your receiving less than the
unit par value and also reduce the size and diversity of the Fund.
18
<PAGE>
There could be a delay in paying you for your units:
- if the New York Stock Exchange is closed (other than customary weekend and
holiday closings);
- if the SEC determines that trading on the New York Stock Exchange is
restricted or that an emergency exists making sale or evaluation of the
bonds not reasonably practicable; and
- for any other period permitted by SEC order.
EXCHANGE OPTION
You may exchange units of certain Defined Asset Funds for units of this Fund at
a maximum exchange fee of 1.90%. You may exchange units of this Fund for units
of certain other Defined Asset Funds at a reduced sales fee if your investment
goals change. In addition, you may exchange into this Fund from certain other
Defined Asset Funds and unit trusts. To exchange units, you should talk to your
financial professional about what funds are exchangeable, suitable and currently
available.
Normally, an exchange is taxable and you must recognize any gain or loss on the
exchange. However, the IRS may try to disallow a loss if the portfolios of the
two funds are not materially different; you should consult your own tax adviser.
We may amend or terminate this exchange option at any time without notice.
HOW THE FUND WORKS
PRICING
The price of a unit includes interest accrued on the bonds, less expenses, from
the initial most recent Record Day up to, but not including, the settlement
date, which is usually three business days after the purchase date of the unit.
A portion of the price of a unit consists of cash so that the Trustee can
provide you with regular monthly income. When you sell your units you will
receive your share of this cash.
EVALUATIONS
An independent Evaluator values the bonds on each business day (excluding
Saturdays, Sundays and the following holidays as observed by the New York Stock
Exchange: New Year's Day, Presidents' Day, Martin Luther King, Jr. Day, Good
Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving and Christmas).
Bond values are based on current bid or offer prices for the bonds or comparable
bonds. In the past, the difference between bid and offer prices of publicly
offered tax-exempt bonds has ranged from 0.5% of face amount on actively traded
issues to 3.5% on inactively traded issues; the difference has averaged between
1 and 2%.
INCOME
The Trustee credits interest to an Income Account and other receipts to a
Capital Account. The Trustee may establish a Reserve Account by withdrawing from
these accounts amounts it considers appropriate to pay any material liability.
These accounts do not bear interest.
19
<PAGE>
EXPENSES
The Trustee is paid monthly. It also benefits when it holds cash for the Fund in
non-interest bearing accounts. The Trustee may also receive additional amounts:
- to reimburse the Trustee for the Fund's operating expenses;
- for extraordinary services and costs of indemnifying the Trustee and the
Sponsors;
- costs of actions taken to protect the Fund and other legal fees and
expenses;
- expenses for keeping the Fund's registration statement current; and
- Fund termination expenses and any governmental charges.
The Sponsors are currently reimbursed up to 55 CENTS per $1,000 face amount
annually for providing portfolio supervisory, bookkeeping and administrative
services and for any other expenses properly chargeable to the Fund. Legal,
typesetting, electronic filing and regulatory filing fees and expenses
associated with updating the Portfolio's registration statement yearly are also
now chargeable to the Portfolio. While this fee may exceed the amount of these
costs and expenses attributable to this Fund, the total of these fees for all
Series of Defined Asset Funds will not exceed the aggregate amount attributable
to all of these Series for any calendar year. The Fund also pays the Evaluator's
fees.
The Trustee's, Sponsors' and Evaluator's fees may be adjusted for inflation
without investors' approval.
The Sponsors will pay advertising and selling expenses at no charge to the Fund.
If Fund expenses exceed initial estimates, the Fund will owe the excess. The
Trustee has a lien on Fund assets to secure reimbursement of Fund expenses and
may sell bonds if cash is not available.
PORTFOLIO CHANGES
The Sponsors and Trustee are not liable for any default or defect in a bond; if
a contract to buy any bond.
Unlike a mutual fund, the portfolio is designed to remain intact and we may keep
bonds in the portfolio even if their credit quality declines or other adverse
financial circumstances occur. However, we may sell a bond in certain cases if
we believe that certain adverse credit conditions exist or if a bond becomes
taxable.
If we maintain a secondary market in units but are unable to sell the units that
we buy in the secondary market, we will redeem units, which may affect the
composition of the portfolio. Units offered in the secondary market may not
represent the same face amount of bonds that they did originally.
We decide whether or not to offer units for sale that we acquire in the
secondary market after reviewing:
- diversity of the portfolio;
- size of the Fund relative to its original size;
- ratio of Fund expenses to income;
- current and long-term returns;
- degree to which units may be selling at a premium over par; and
- cost of maintaining a current prospectus.
FUND TERMINATION
The Fund will terminate following the stated maturity or sale of the last bond
in the
20
<PAGE>
portfolio. The Fund may also terminate earlier with the consent of investors
holding 51% of the units or if total assets of the Fund have fallen below 40% of
the face amount of bonds deposited. We will decide whether to terminate the Fund
early based on the same factors used in deciding whether or not to offer units
in the secondary market.
When the Fund is about to terminate you will receive a notice, and you will be
unable to sell your units after that time. On or shortly before termination, we
will sell any remaining bonds, and you will receive your final distribution. Any
bond that cannot be sold at a reasonable price may continue to be held by the
Trustee in a liquidating trust pending its final sale.
You will pay your share of the expenses associated with termination, including
brokerage costs in selling bonds. This may reduce the amount you receive as your
final distribution.
CERTIFICATES
Certificates for units are issued on request. You may transfer certificates by
complying with the requirements for redeeming certificates, described above. You
can replace lost or mutilated certificates by delivering satisfactory indemnity
and paying the associated costs.
TRUST INDENTURE
The Fund is a "unit investment trust" governed by a Trust Indenture, a contract
among the Sponsors, the Trustee and the Evaluator, which sets forth their duties
and obligations and your rights. A copy of the Indenture is available to you on
request to the Trustee. The following summarizes certain provisions of the
Indenture.
The Sponsors and the Trustee may amend the Indenture without your consent:
- to cure ambiguities;
- to correct or supplement any defective or inconsistent provision;
- to make any amendment required by any governmental agency; or
- to make other changes determined not to be materially adverse to your best
interest (as determined by the Sponsors).
Investors holding 51% of the units may amend the Indenture. Every investor must
consent to any amendment that changes the 51% requirement. No amendment may
reduce your interest in the Fund without your written consent.
The Trustee may resign by notifying the Sponsors. The Sponsors may remove the
Trustee without your consent if:
- it fails to perform its duties and the Sponsors determine that its
replacement is in your best interest; or
- it becomes incapable of acting or bankrupt or its affairs are taken over by
public authorities.
Investors holding 51% of the units may remove the Trustee. The Evaluator may
resign or be removed by the Sponsors and the Trustee without the consent of
investors. The resignation or removal of either becomes effective when a
successor accepts appointment. The Sponsors will try to appoint a successor
promptly; however, if no successor has accepted within 30 days after notice of
resignation, the resigning Trustee
21
<PAGE>
or Evaluator may petition a court to appoint a successor.
Any Sponsor may resign as long as one Sponsor with a net worth of $2 million
remains and agrees to the resignation. The remaining Sponsors and the Trustee
may appoint a replacement. If there is only one Sponsor and it fails to perform
its duties or becomes bankrupt the Trustee may:
- remove it and appoint a replacement Sponsor;
- liquidate the Fund; or
- continue to act as Trustee without a Sponsor.
Merrill Lynch, Pierce, Fenner & Smith Incorporated acts as agent for the
Sponsors.
The Trust Indenture contains customary provisions limiting the liability of the
Trustee, the Sponsors and the Evaluator.
LEGAL OPINION
Davis Polk & Wardwell, 450 Lexington Avenue, New York, New York 10017, as
counsel for the Sponsors, has given an opinion that the units are validly
issued. Special counsel located in the relevant states have given state and
local tax opinions.
AUDITORS
Deloitte & Touche LLP, 2 World Financial Center, New York, New York 10281,
independent accountants, audited the Statements of Condition included in this
prospectus.
SPONSORS
The Sponsors are:
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED (a wholly-owned subsidiary of
Merrill Lynch & Co., Inc.)
P.O. Box 9051,
Princeton, NJ 08543-9051
SALOMON SMITH BARNEY INC. (an indirectly wholly-owned subsidiary of Citigroup
Inc.)
388 Greenwich Street--23rd Floor,
New York, NY 10013
DEAN WITTER REYNOLDS INC. (a principal operating subsidiary of Morgan Stanley
Dean Witter & Co.)
Two World Trade Center--59th Floor,
New York, NY 10048
PRUDENTIAL SECURITIES INCORPORATED (an
indirect wholly-owned subsidiary of the
Prudential Insurance Company of America)
One New York Plaza
New York, NY 10292
PAINEWEBBER INCORPORATED (a wholly-owned subsidiary of PaineWebber Group Inc.)
1285 Avenue of the Americas,
New York, NY 10019
Each Sponsor is a Delaware corporation and it, or its predecessor, has acted as
sponsor to many unit investment trusts. As a registered broker-dealer each
Sponsor buys and sells securities (including investment company shares) for
others (including investment companies) and participates as an underwriter in
various selling groups.
TRUSTEE
The Chase Manhattan Bank, Unit Investment Trust Department, 4 New York
Plaza--6th Floor, New York, New York 10004, is the Trustee. It is supervised by
the Federal Deposit Insurance Corporation, the
22
<PAGE>
Board of Governors of the Federal Reserve System and New York State banking
authorities.
UNDERWRITERS' AND SPONSORS' PROFITS
Underwriters receive sales charges when they sell units. The Sponsors also
realized a profit or loss on the initial date of deposit of the bonds. Any cash
made available by you to the Sponsors before the settlement date for those units
may be used in the Sponsors' businesses to the extent permitted by federal law
and may benefit the Sponsors.
A Sponsor or Underwriter may realize profits or sustain losses on bonds in the
Fund which were acquired from underwriting syndicates of which it was a member.
In maintaining a secondary market, the Sponsors will also realize profits or
sustain losses in the amount of any difference between the prices at which they
buy units and the prices at which they resell or redeem them.
PUBLIC DISTRIBUTION
The Sponsors do not intend to qualify units for sale in any foreign countries.
This prospectus does not constitute an offer to sell units in any country where
units cannot lawfully be sold.
CODE OF ETHICS
The Fund and the Agent for the Sponsors have each adopted a code of ethics
requiring reporting of personal securities transactions by its employees with
access to information on Fund transactions. Subject to certain conditions, the
codes permit employees to invest in Fund securities for their own accounts. The
codes are designed to prevent fraud, deception and misconduct against the Fund
and to provide reasonable standards of conduct. These codes are on file with the
Commission and you may obtain a copy by contacting the Commission at the address
listed on the back cover of this prospectus.
YEAR 2000 ISSUES
Many computer systems were designed in such a way that they may be unable to
distinguish between the year 2000 and the year 1900 (commonly known as the "Year
2000 Problem"). To date we are not aware of any major operational difficulties
resulting from the computer system changes necessary to prepare for the Year
2000. However, there can be no assurance that the Year 2000 Problem will not
adversely affect the issuers of the bonds contained in the Portfolio. We cannot
predict whether any impact will be material to the Fund as a whole.
TAXES
The following summary describes some of the important income tax consequences of
holding units. It assumes that you are not a dealer, financial institution,
insurance company or other investor with special circumstances or subject to
special rules. You should consult your own tax adviser about your particular
circumstances.
At the date of issue of each bond, counsel for the issuer delivered an opinion
to the effect that interest on the bond is exempt from regular federal income
tax. However, interest may be subject to state and local taxes and may be taken
into account in
23
<PAGE>
determining your preference items for alternative minimum tax purposes. Neither
we nor our counsel have reviewed the issuance of the bonds, related proceedings
or the basis for the opinions of counsel for the issuers. We cannot assure you
that the issuers (or other users of bond proceeds) have complied or will comply
with any requirements necessary for a bond to be tax-exempt. If any of the bonds
were determined not to be tax-exempt, you could be required to pay income tax
for current and prior years, and if the Fund were to sell the bond, it might
have to sell it at a substantial discount.
In the opinion of our counsel, under existing law:
GENERAL TREATMENT OF THE FUND AND YOUR INVESTMENT
The Fund will not be taxed as a corporation for federal income tax purposes, and
you will be considered to own directly your share of each bond in the Fund.
GAIN OR LOSS UPON DISPOSITION
When all or part of your share of a bond is disposed of (for example, when the
Fund sells, exchanges or redeems a bond or when you sell or exchange your
units), you will generally recognize capital gain or loss. Your gain, however,
will generally be ordinary income to the extent of any accrued "market
discount". Generally you will have market discount to the extent that your basis
in a bond when you purchase a unit is less than its stated redemption price at
maturity (or, if it is an original issue discount bond, the issue price
increased by original issue discount that has accrued on the bond before your
purchase). You should consult your tax adviser in this regard.
If your net long-term capital gains exceed your net short-term capital losses,
the excess may be subject to tax at a lower rate than ordinary income. Any
capital gain from the Fund will be long-term if you are considered to have held
your investment on each bond for more than one year and short-term otherwise.
Because the deductibility of capital losses is subject to limitations, you may
not be able to deduct all of your capital losses.
YOUR BASIS IN THE BONDS
Your aggregate basis in the bonds will be equal to the cost of your units,
including any sales charges you pay, adjusted to reflect any accruals of
"original issue discount," "acquisition premium" and "bond premium". You should
consult your tax adviser in this regard.
EXPENSES
If you are not a corporate investor, you will not be entitled to a deduction for
your share of fees and expenses of the Fund. Also, if you borrowed money in
order to purchase or carry your units, you will not be able to deduct the
interest on this borrowing for federal income tax purposes. The IRS may treat
your purchase of units as made with borrowed money even if the money is not
directly traceable to the purchase of units.
CALIFORNIA TAXES
In the opinion of O'Melveny & Myers LLP, Los Angeles, California, special
counsel on California tax matters:
24
<PAGE>
Under the income tax laws of the State of California, the Trust will not be
taxed as a corporation and you will be considered to own directly your share of
each bond of the Trust. If you are a California taxpayer, your share of the
income from the bonds of the Trust will not be tax-exempt in California except
for California personal income tax purposes and only to the extent that the
income is earned on bonds that are exempt for such purposes. If you are a
California taxpayer and all or part of your share of a bond is disposed of (for
example, when a bond is sold, exchanged or redeemed at maturity or you sell or
exchange your units), you will recognize gain or loss for California tax
purposes. Depending on where you live, your income from the Trust may be subject
to state and local taxation. You should consult your tax advisor in this regard.
MARYLAND TAXES
In the opinion of Saul, Ewing, Remick & Saul LLP, Baltimore, Maryland, special
counsel on Maryland tax matters:
Under the income tax laws of the State of Maryland, the Fund will not be taxed
as a corporation and you will be considered to own directly your share of each
bond in the Fund. You will not be subject to Maryland tax on any income earned
by the Fund to the extent such income is attributable to bonds (other than
private activity bonds) issued by the State of Maryland, the Government of
Puerto Rico, or the Government of Guam or their respective political
subdivisions and authorities. When all or part of your share of a bond is
disposed of (for example, when the Fund sells, exchanges or redeems a bond or
when you sell or exchange your units), you will generally recognize capital gain
or loss except to the extent the gain is derived from the disposition of a bond
issued by the State of Maryland or its political subdivisions. Neither the bonds
in the Fund nor units held by you will be subject to Maryland personal property
tax or Maryland sales and use tax. If you are a Maryland resident at the time of
your death, your units will be subject to Maryland inheritance and estate tax.
NEW JERSEY TAXES
In the opinion of Drinker Biddle & Reath LLP, Philadelphia, Pennsylvania,
special counsel on New Jersey tax matters:
The Fund will not be taxed as a corporation under the current income tax laws of
the State of New Jersey. Your income from the Fund may be subject to taxation
depending on where you live. If you are a New Jersey taxpayer your income from
the Fund (including gains on sales of bonds by the Fund) and gains on sales of
units by you will be tax-exempt to the extent that income and gains are earned
on bonds that are tax-exempt for New Jersey purposes. You should consult your
tax adviser as to the consequences to you with respect to any investment you
make in the Fund.
25
<PAGE>
SUPPLEMENTAL INFORMATION
You can receive at no cost supplemental information about the Fund by calling
the Trustee. The supplemental information includes more detailed risk disclosure
about the types of bonds that may be in the Fund's portfolios, general risk
disclosure concerning any insurance securing certain bonds, and general
information about the structure and operation of the Fund. The supplemental
information is also available from the SEC.
26
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (CALIFORNIA, MARYLAND AND
NEW JERSEY TRUSTS), DEFINED ASSET FUNDS
REPORT OF INDEPENDENT ACCOUNTANTS
The Sponsors, Trustee and Holders
of Municipal Investment Trust Fund,
Multistate Series - 64 (California, Maryland and
New Jersey Trusts), Defined Asset Funds:
We have audited the accompanying statements of condition of
Defined Asset Funds - Municipal Investment Trust Fund,
Multistate Series - 64, including the portfolios, as of May 31,
2000 and the related statements of operations and of changes in
net assets for the years ended May 31, 2000, 1999 and 1998. These
financial statements are the responsibility of the Trustee. Our
responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with auditing standards
generally accepted in the United States of America. Those
standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures
in the financial statements. Securities owned at May 31, 2000,
as shown in such portfolios, were confirmed to us by The Chase
Manhattan Bank, the Trustee. An audit also includes assessing
the accounting principles used and significant estimates made
by the Trustee, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial
position of Defined Asset Funds - Municipal Investment Trust
Fund, Multistate Series - 64 at May 31, 2000 and the results of
their operations and changes in their net assets for the above-stated
years in accordance with accounting principles generally accepted
in the United States of America.
DELOITTE & TOUCHE LLP
New York, N.Y.
September 11, 2000
D - 1
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (CALIFORNIA TRUST),
DEFINED ASSET FUNDS
STATEMENT OF CONDITION
As of May 31, 2000
<TABLE>
<S> <C>
TRUST PROPERTY:
Investment in marketable securities
at value (cost $ 2,403,139)(Note 1) ......... $ 2,483,822
Accrued interest................................ 48,689
Cash - principal ............................... 6,014
-------------
Total trust property ......................... 2,538,525
LESS LIABILITIES:
Income advance from Trustee..................... $ 16,817
Accrued Sponsors' fees ......................... 605 17,422
------------- -------------
NET ASSETS, REPRESENTED BY:
2,555 units of fractional undivided
interest outstanding (Note 3) ............... 2,489,836
Undistributed net investment income ............ 31,267 $ 2,521,103
------------- =============
UNIT VALUE ($ 2,521,103 / 2,555 units)............ $ 986.73
=============
</TABLE>
See Notes to Financial Statements.
D - 2
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (CALIFORNIA TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Years Ended May 31,
2000 1999 1998
---- ---- ----
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income ........................ $ 151,731 $ 178,043 $ 195,819
Trustee's fees and expenses ............ (4,593) (4,609) (5,458)
Sponsors' fees ......................... (1,528) (1,465) (1,557)
----------------------------------------------
Net investment income .................. 145,610 171,969 188,804
----------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain on
securities sold or redeemed .......... 25,500 40,090 16,689
Unrealized appreciation (depreciation)
of investments ....................... (221,194) (43,239) 191,686
----------------------------------------------
Net realized and unrealized
gain (loss) on investments ........... (195,694) (3,149) 208,375
----------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS .............. $ (50,084) $ 168,820 $ 397,179
==============================================
</TABLE>
See Notes to Financial Statements.
D - 3
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (CALIFORNIA TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Years Ended May 31,
2000 1999 1998
---- ---- ----
<S> <C> <C> <C>
OPERATIONS:
Net investment income .................. $ 145,610 $ 171,969 $ 188,804
Realized gain on
securities sold or redeemed .......... 25,500 40,090 16,689
Unrealized appreciation (depreciation)
of investments ....................... (221,194) (43,239) 191,686
----------------------------------------------
Net increase (decrease) in net assets
resulting from operations ............ (50,084) 168,820 397,179
----------------------------------------------
DISTRIBUTIONS TO HOLDERS (Note 2):
Income ................................ (146,025) (172,663) (189,050)
Principal .............................. (19,524) (12,870) (4,469)
----------------------------------------------
Total distributions .................... (165,549) (185,533) (193,519)
----------------------------------------------
SHARE TRANSACTIONS:
Redemption amounts - income ............ (3,684) (4,240) (2,661)
Redemption amounts - principal ......... (327,153) (407,498) (245,734)
----------------------------------------------
Total share transactions ............... (330,837) (411,738) (248,395)
----------------------------------------------
NET DECREASE IN NET ASSETS ............... (546,470) (428,451) (44,735)
NET ASSETS AT BEGINNING OF YEAR .......... 3,067,573 3,496,024 3,540,759
----------------------------------------------
NET ASSETS AT END OF YEAR ................ $ 2,521,103 $ 3,067,573 $ 3,496,024
==============================================
PER UNIT:
Income distributions during
year ................................. $ 54.39 $ 55.17 $ 55.34
==============================================
Principal distributions during
year ................................. $ 7.07 $ 4.10 $ 1.30
==============================================
Net asset value at end of
year ................................. $ 986.73 $ 1,065.13 $ 1,070.10
==============================================
TRUST UNITS:
Redeemed during year ................... 325 387 233
Outstanding at end of year ............. 2,555 2,880 3,267
==============================================
</TABLE>
See Notes to Financial Statements.
D - 4
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (CALIFORNIA TRUST),
DEFINED ASSET FUNDS
NOTES TO FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES
The Fund is registered under the Investment Company Act of 1940 as a Unit
Investment Trust. The following is a summary of significant accounting
policies consistently followed by the Fund in the preparation of its
financial statements. The policies are in accordance with accounting
principles generally accepted in the United States of America.
(A) Securities are stated at value as determined by the
Evaluator based on bid side evaluations for the securities.
(B) The Fund is not subject to income taxes. Accordingly, no
provision for such taxes is required.
(C) Interest income is recorded as earned.
2. DISTRIBUTIONS
A distribution of net investment income is made to Holders each month.
Receipts other than interest, after deductions for redemptions and
applicable expenses, are also distributed periodically.
3. NET CAPITAL
<TABLE>
<S> <C>
Cost of 2,555 units at Date of Deposit ..................... $ 2,556,235
Less sales charge .......................................... 115,026
-----------
Net amount applicable to Holders ........................... 2,441,209
Redemptions of units - net cost of 945 units redeemed
less redemption amounts (principal)....................... (77,472)
Realized gain on securities sold or redeemed ............... 82,279
Principal distributions .................................... (36,863)
Unrealized appreciation of investments...................... 80,683
-----------
Net capital applicable to Holders .......................... $ 2,489,836
===========
</TABLE>
4. INCOME TAXES
As of May 31, 2000, unrealized appreciation of investments, based on cost
for Federal income tax purposes, aggregated $80,683, all of which related
to appreciated securities. The cost of investment securities for Federal
income tax purposes was $2,403,139 at May 31, 2000.
D - 5
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (CALIFORNIA TRUST)(INSURED),
DEFINED ASSET FUNDS
PORTFOLIO
As of May 31, 2000
<TABLE>
<CAPTION>
Rating of Optional
Portfolio No. and Title of Issues Face Redemption
Securities (1)(4) Amount Coupon Maturities(3) Provisions(3) Cost Value(2)
---------- --------- ----------- ----------- ----------- ------------ ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
1 California Statewide Comm. Dev. Auth. AAA $ 520,000 5.500 % 2023 08/15/03 $ 477,667 $ 488,842
(Sutter Hlth. Oblig. Group) (MBIA Ins.) @ 102.000
2 Fontana Pub. Fin. Auth., CA, Tax Alloc. AAA 550,000 5.625 2024 09/01/04 517,688 528,512
Rev. Bonds (North Fontana Redev. Proj.), @ 102.000
1993 Ser. A (MBIA Ins.)
3 Northern California Pwr. Agcy. Rfdg. AAA 320,000 5.500 2023 07/01/02 294,010 302,416
Rev. Bonds (Hydroelectric Proj. Number @ 100.000
One), Ser. 1992 A (MBIA Ins.)
4 Palmdale Civic Auth., Los Angeles Cnty. AAA 115,000 6.150 2024(6) 09/01/04 115,000 123,142
,CA 1994 Rev. Bonds, Ser. A (Merged @ 102.000
Redev. Proj. Areas) (MBIA Ins.)
185,000 6.150 2024 09/01/04 185,000 186,752
@ 102.000
5 State of California, Var. Purpose G.O. AAA 55,000 6.000 2021(6) 10/01/02 55,000 57,683
Bonds (MBIA Ins.) @ 102.000
10,000 6.000 2021 10/01/02 10,000 10,029
@ 102.000
6 The City of Los Angeles, CA, AAA 500,000 5.875 2024 06/01/04 485,000 495,240
Wastewater Sys. Rev. Bonds, Ser. 1994-A @ 102.000
(MBIA Ins.)
7 The City of Riverside, CA Redev. Agy. AAA 280,000 5.625 2023(6) 08/01/02 263,774 291,206
Tax Alloc. Rev. Rfdg. Bonds, Ser.1993 A @ 102.000
(MBIA Ins.)
--------- --------- ---------
$ 2,535,000 $ 2,403,139 $ 2,483,822
========= ========= =========
</TABLE>
See Notes to Portfolios on page D - 17.
D - 6
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (MARYLAND TRUST),
DEFINED ASSET FUNDS
STATEMENT OF CONDITION
As of May 31, 2000
<TABLE>
<S> <C>
TRUST PROPERTY:
Investment in marketable securities
at value (cost $ 2,773,282)(Note 1) ......... $ 2,740,569
Accrued interest................................ 51,173
Cash - principal ............................... 7
-------------
Total trust property ......................... 2,791,749
LESS LIABILITIES:
Income advance from Trustee..................... $ 15,167
Accrued Sponsors' fees ......................... 658 15,825
------------- -------------
NET ASSETS, REPRESENTED BY:
2,886 units of fractional undivided
interest outstanding (Note 3) ............... 2,740,576
Undistributed net investment income ............ 35,348 $ 2,775,924
------------- =============
UNIT VALUE ($ 2,775,924 / 2,886 units)............ $ 961.86
=============
</TABLE>
See Notes to Financial Statements.
D - 7
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (MARYLAND TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Years Ended May 31,
2000 1999 1998
---- ---- ----
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income ........................ $ 163,159 $ 169,971 $ 170,416
Trustee's fees and expenses ............ (4,776) (4,493) (5,212)
Sponsors' fees ......................... (1,436) (1,347) (1,348)
----------------------------------------------
Net investment income .................. 156,947 164,131 163,856
----------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain on
securities sold or redeemed .......... 3,993 2,784
Unrealized appreciation (depreciation)
of investments ....................... (233,686) (21,850) 146,637
----------------------------------------------
Net realized and unrealized
gain (loss) on investments ........... (229,693) (19,066) 146,637
----------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS .............. $ (72,746) $ 145,065 $ 310,493
==============================================
</TABLE>
See Notes to Financial Statements.
D - 8
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (MARYLAND TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Years Ended May 31,
2000 1999 1998
---- ---- ----
<S> <C> <C> <C>
OPERATIONS:
Net investment income .................. $ 156,947 $ 164,131 $ 163,856
Realized gain on
securities sold or redeemed .......... 3,993 2,784
Unrealized appreciation (depreciation)
of investments ....................... (233,686) (21,850) 146,637
----------------------------------------------
Net increase (decrease) in net assets
resulting from operations ............ (72,746) 145,065 310,493
----------------------------------------------
DISTRIBUTIONS TO HOLDERS (Note 2):
Income ................................ (156,768) (164,266) (163,834)
Principal .............................. (4,242)
----------------------------------------------
Total distributions .................... (161,010) (164,266) (163,834)
----------------------------------------------
SHARE TRANSACTIONS:
Redemption amounts - income ............ (795) (684)
Redemption amounts - principal ......... (61,840) (67,082)
----------------------------------------------
Total share transactions ............... (62,635) (67,766)
----------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS .... (296,391) (86,967) 146,659
NET ASSETS AT BEGINNING OF YEAR .......... 3,072,315 3,159,282 3,012,623
----------------------------------------------
NET ASSETS AT END OF YEAR ................ $ 2,775,924 $ 3,072,315 $ 3,159,282
==============================================
PER UNIT:
Income distributions during
year ................................. $ 54.32 $ 54.67 $ 54.43
==============================================
Principal distributions during
year ................................. $ 1.47
==================
Net asset value at end of
year ................................. $ 961.86 $ 1,042.88 $ 1,049.60
==============================================
TRUST UNITS:
Redeemed during year ................... 60 64
Outstanding at end of year ............. 2,886 2,946 3,010
==============================================
</TABLE>
See Notes to Financial Statements.
D - 9
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (MARYLAND TRUST),
DEFINED ASSET FUNDS
NOTES TO FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES
The Fund is registered under the Investment Company Act of 1940 as a Unit
Investment Trust. The following is a summary of significant accounting
policies consistently followed by the Fund in the preparation of its
financial statements. The policies are in accordance with accounting
principles generally accepted in the United States of America.
(A) Securities are stated at value as determined by the
Evaluator based on bid side evaluations for the securities.
(B) The Fund is not subject to income taxes. Accordingly, no
provision for such taxes is required.
(C) Interest income is recorded as earned.
2. DISTRIBUTIONS
A distribution of net investment income is made to Holders each month.
Receipts other than interest, after deductions for redemptions and
applicable expenses, are also distributed periodically.
3. NET CAPITAL
<TABLE>
<S> <C>
Cost of 2,886 units at Date of Deposit ..................... $ 2,925,388
Less sales charge .......................................... 131,631
-----------
Net amount applicable to Holders ........................... 2,793,757
Redemptions of units - net cost of 364 units redeemed
less redemption amounts (principal)....................... (13,931)
Realized gain on securities sold or redeemed ............... 9,504
Principal distributions .................................... (16,041)
Net unrealized depreciation of investments.................. (32,713)
-----------
Net capital applicable to Holders .......................... $ 2,740,576
===========
</TABLE>
4. INCOME TAXES
As of May 31, 2000, net unrealized depreciation of investments, based on
cost for Federal income tax purposes, aggregated $32,713, of which $14,404
related to appreciated securities and $47,117 related to depreciated
securities. The cost of investment securities for Federal income tax
purposes was $2,773,282 at May 31, 2000.
D - 10
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (MARYLAND TRUST),
DEFINED ASSET FUNDS
PORTFOLIO
As of May 31, 2000
<TABLE>
<CAPTION>
Rating Optional
Portfolio No. and Title of of Face Redemption
Securities Issues(1) Amount Coupon Maturities(3) Provisions(3) Cost Value(2)
---------- --------- ----------- ----------- ----------- ------------ ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
1 Anne Arundel Cnty., MD, Poll. Ctl. Rev. A $ 500,000 6.000 % 2024 04/01/04 $ 504,150 $ 487,585
Rfdg. Bonds (Baltimore Gas and Elec. @ 102.000
Co. Proj.), Ser. 1994
2 Maryland Hlth. and Educl. Facs. Auth. AAA 500,000 6.125 2019 07/01/04 503,155 505,650
Rev. Bonds, Maryland Gen. Hosp. Issue, @ 102.000
Ser. 1994 (MBIA Ins.) (5)
3 Maryland Hlth. and Higher Educl. Facs. AAA 500,000 5.000 2018 07/01/03 433,905 444,240
Auth. Rev. Rfdg. Bonds, Francis Scott @ 102.000
Key Med. Ctr. Iss., Ser. 1993
(Financial Guaranty Ins.) (5)
4 Mayor and City Council of Ocean City, AAA 525,000 5.750 2015 03/15/04 525,000 525,971
MD, G.O. Mun. Purp. and Rfdg. Bonds of @ 102.000
1994 (MBIA Ins.) (5)
5 Prince George's Cnty., MD, (Dimensions Baa1(m) 80,000 5.300 2024 07/01/04 68,318 56,880
Hlth. Corp. Issue) Proj. and Rfdg. @ 102.000
Rev. Bonds, Ser. 1994
6 Prince George's Cnty., MD, Poll. Ctl. A1(m) 435,000 6.000 2022 09/01/02 438,254 419,949
Rev. Rfdg. Bonds (Potomac Elec. Proj.), @ 102.000
Ser. 1992
7 Puerto Rico Hwy. and Trans. Auth. Hwy. A 30,000 5.750 2018 07/01/02 28,866 29,469
Rev. Rfdg. Bonds, Ser. V @ 100.000
8 Washington Suburban Sanit. Dist., MD Aa1(m) 290,000 5.250 2017 06/01/03 271,634 270,825
(Montgomery and Prince George's @ 102.000
Cntys.), Gen. Construction Bonds of
1993 (Second Ser.)
--------- --------- ---------
$ 2,860,000 $ 2,773,282 $ 2,740,569
========= ========= =========
</TABLE>
See Notes to Portfolios on page D -17.
D - 11
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (NEW JERSEY TRUST),
DEFINED ASSET FUNDS
STATEMENT OF CONDITION
As of May 31, 2000
<TABLE>
<S> <C>
TRUST PROPERTY:
Investment in marketable securities
at value (cost $ 2,002,960)(Note 1) ......... $ 2,008,946
Accrued interest................................ 40,840
Cash - principal ............................... 7,470
-------------
Total trust property ......................... 2,057,256
LESS LIABILITIES:
Income advance from Trustee..................... $ 15,426
Accrued Sponsors' fees ......................... 603 16,029
------------- -------------
NET ASSETS, REPRESENTED BY:
2,115 units of fractional undivided
interest outstanding (Note 3) ............... 2,016,416
Undistributed net investment income ............ 24,811 $ 2,041,227
------------- =============
UNIT VALUE ($ 2,041,227 / 2,115 units)............ $ 965.12
=============
</TABLE>
See Notes to Financial Statements.
D - 12
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (NEW JERSEY TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Years Ended May 31,
2000 1999 1998
---- ---- ----
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income ........................ $ 149,544 $ 168,712 $ 174,325
Trustee's fees and expenses ............ (4,605) (4,487) (5,242)
Sponsors' fees ......................... (1,497) (1,345) (1,375)
----------------------------------------------
Net investment income .................. 143,442 162,880 167,708
----------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain (loss) on
securities sold or redeemed .......... (1,216) 17,058
Unrealized appreciation (depreciation)
of investments ....................... (218,772) (8,480) 150,744
----------------------------------------------
Net realized and unrealized
gain (loss) on investments ........... (219,988) 8,578 150,744
----------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS .............. $ (76,546) $ 171,458 $ 318,452
==============================================
</TABLE>
See Notes to Financial Statements.
D - 13
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (NEW JERSEY TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Years Ended May 31,
2000 1999 1998
---- ---- ----
<S> <C> <C> <C>
OPERATIONS:
Net investment income .................. $ 143,442 $ 162,880 $ 167,708
Realized gain (loss) on
securities sold or redeemed .......... (1,216) 17,058
Unrealized appreciation (depreciation)
of investments ....................... (218,772) (8,480) 150,744
----------------------------------------------
Net increase (decrease) in net assets
resulting from operations ............ (76,546) 171,458 318,452
----------------------------------------------
DISTRIBUTIONS TO HOLDERS (Note 2):
Income ................................ (144,853) (163,057) (167,670)
Principal .............................. (13,694) (9,783)
----------------------------------------------
Total distributions .................... (158,547) (172,840) (167,670)
----------------------------------------------
SHARE TRANSACTIONS:
Redemption amounts - income ............ (8,062) (1,919)
Redemption amounts - principal ......... (752,469) (177,982)
----------------------------------------------
Total share transactions ............... (760,531) (179,901)
----------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS .... (995,624) (181,283) 150,782
NET ASSETS AT BEGINNING OF YEAR .......... 3,036,851 3,218,134 3,067,352
----------------------------------------------
NET ASSETS AT END OF YEAR ................ $ 2,041,227 $ 3,036,851 $ 3,218,134
==============================================
PER UNIT:
Income distributions during
year ................................. $ 54.18 $ 54.93 $ 54.83
==============================================
Principal distributions during
year ................................. $ 4.94 $ 3.34
====================================
Net asset value at end of
year ................................. $ 965.12 $ 1,051.18 $ 1,052.37
==============================================
TRUST UNITS:
Redeemed during year ................... 774 169
Outstanding at end of year ............. 2,115 2,889 3,058
==============================================
</TABLE>
See Notes to Financial Statements.
D - 14
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (NEW JERSEY TRUST),
DEFINED ASSET FUNDS
NOTES TO FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES
The Fund is registered under the Investment Company Act of 1940 as a Unit
Investment Trust. The following is a summary of significant accounting
policies consistently followed by the Fund in the preparation of its
financial statements. The policies are in accordance with accounting
principles generally accepted in the United States of America.
(A) Securities are stated at value as determined by the
Evaluator based on bid side evaluations for the securities.
(B) The Fund is not subject to income taxes. Accordingly, no
provision for such taxes is required.
(C) Interest income is recorded as earned.
2. DISTRIBUTIONS
A distribution of net investment income is made to Holders each month.
Receipts other than interest, after deductions for redemptions and
applicable expenses, are also distributed periodically.
3. NET CAPITAL
<TABLE>
<S> <C>
Cost of 2,115 units at Date of Deposit ..................... $ 2,142,234
Less sales charge .......................................... 96,402
-----------
Net amount applicable to Holders ........................... 2,045,832
Redemptions of units - net cost of 1,135 units redeemed
less redemption amounts (principal)....................... (19,466)
Realized gain on securities sold or redeemed ............... 13,229
Principal distributions .................................... (29,165)
Net unrealized appreciation of investments.................. 5,986
-----------
Net capital applicable to Holders .......................... $ 2,016,416
===========
</TABLE>
4. INCOME TAXES
As of May 31, 2000, net unrealized appreciation of investments, based on
cost for Federal income tax purposes, aggregated $5,986, of which $11,837
related to appreciated securities and $5,851 related to depreciated
securities. The cost of investment securities for Federal income tax
purposes was $2,002,960 at May 31, 2000.
D - 15
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (NEW JERSEY TRUST)(INSURED),
DEFINED ASSET FUNDS
PORTFOLIO
As of May 31, 2000
<TABLE>
<CAPTION>
Rating of Optional
Portfolio No. and Title of Issues Face Redemption
Securities (1) (4) Amount Coupon Maturities(3) Provisions(3) Cost Value(2)
---------- --------- ----------- ----------- ----------- ------------ ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
1 New Jersey Econ. Dev. Auth. Rev. Bonds AAA $ 205,000 6.125 % 2024 07/01/04 $ 208,928 $ 207,212
(Rutgers, The State Univ.-Civic Square @ 102.000
Proj.), Ser. 1994 (AMBAC Ins.)
2 New Jersey Econ. Dev. Auth., Econ. Dev. AAA 250,000 5.450 2023 09/01/03 234,395 233,448
Rev. Bonds (Greater New York Council, @ 102.000
Boy Scouts of America-1993 Proj.)
(MBIA Ins.)
3 New Jersey Educl. Fac. Auth. Rev. AAA 85,000 6.000 2024 07/01/04 85,722 85,166
Bonds, New Jersey Institute of @ 102.000
Technology Issue, Ser. 1994 A
(MBIA Ins.)
4 New Jersey Hlth. Care Fac. Fin. Auth. AAA 415,000 5.200 2018 None 377,911 381,389
Rev. Bonds, Allegany Hlth. Sys.-Our
Lady of Lourdes Med. Ctr. Iss., Ser.
1993 (MBIA Ins.)
5 New Jersey Hlth. Care Fac. Fin. Auth., AAA 405,000 5.700 2023 07/01/03 391,068 388,436
Rev. Bonds, Underwood-Mem. Hosp. Issue @ 102.000
Ser. B (AMBAC Ins.)
6 Passaic Valley Sewerage Commissioners, AAA 325,000 5.875 2022 12/01/02 323,875 323,996
NJ, Swr. Sys. Bonds, Ser. D @ 102.000
(AMBAC Ins.)
7 The Poll. Ctl. Fin. Auth. of Salem AAA 415,000 5.550 2033 11/01/03 381,061 389,299
Cnty., NJ, Poll. Ctl. Rev. Rfdg. Bonds, @ 102.000
(Pub. Svc. Elec. & Gas Co. Proj.)
1993 Ser. C (MBIA Ins.)
--------- --------- ---------
$ 2,100,000 $ 2,002,960 $ 2,008,946
========= ========= =========
</TABLE>
See Notes to Portfolios on page D - 17.
D - 16
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 64 (CALIFORNIA, MARYLAND AND
NEW JERSEY TRUSTS), DEFINED ASSET FUNDS
NOTES TO PORTFOLIOS
As of May 31, 2000
(1) The ratings of the bonds are by Standard & Poor's Ratings Group, or
by Moody's Investors Service, Inc. if followed by "(m)", or by Fitch
Investors Service, Inc. if followed by "(f)"; "NR" indicates that
this bond is not currently rated by any of the above-mentioned
rating services. These ratings have been furnished by the Evaluator
but not confirmed with the rating agencies.
(2) See Notes to Financial Statements.
(3) Optional redemption provisions, which may be exercised in whole or
in part, are initially at prices of par plus a premium, then
subsequently at prices declining to par. Certain securities may
provide for redemption at par prior or in addition to any optional
or mandatory redemption dates or maturity, for example, through the
operation of a maintenance and replacement fund, if proceeds are not
able to be used as contemplated, the project is condemned or sold or
the project is destroyed and insurance proceeds are used to redeem
the securities. Many of the securities are also subject to mandatory
sinking fund redemption commencing on dates which may be prior to
the date on which securities may be optionally redeemed. Sinking
fund redemptions are at par and redeem only part of the issue. Some
of the securities have mandatory sinking funds which contain
optional provisions permitting the issuer to increase the principal
amount of securities called on a mandatory redemption date. The
sinking fund redemptions with optional provisions may, and optional
refunding redemptions generally will, occur at times when the
redeemed securities have an offering side evaluation which
represents a premium over par. To the extent that the securities
were acquired at a price higher than the redemption price, this will
represent a loss of capital when compared with the Public Offering
Price of the Units when acquired. Distributions will generally be
reduced by the amount of the income which would otherwise have been
paid with respect to redeemed securities and there will be
distributed to Holders any principal amount and premium received on
such redemption after satisfying any redemption requests for Units
received by the Fund. The estimated current return may be affected
by redemptions.
(4) Insured by AAA-rated insurance companies that guarantee timely
payments of principal and interest on the bonds (but not Fund units
or the market value of the bonds before they mature).
(5) Insured by the indicated municipal bond insurance company.
(6) Bonds with an aggregate face amount of $450,000 of the California
Trust have been pre-refunded and are expected to be called for
redemption on the optional redemption provision dates shown.
D - 17
<PAGE>
Defined
Asset Funds-Registered Trademark-
<TABLE>
<S> <C>
HAVE QUESTIONS ? MUNICIPAL INVESTMENT TRUST FUND
Request the most MULTISTATE SERIES--64
recent free Information (A Unit Investment Trust)
Supplement that gives more ---------------------------------------
details about the Fund, This Prospectus does not contain
by calling: complete information about the
The Chase Manhattan Bank investment company filed with the
1-800-323-1508 Securities and Exchange Commission in
Washington, D.C. under the:
- Securities Act of 1933 (file no.
33-53581) and
- Investment Company Act of 1940 (file
no. 811-1777).
TO OBTAIN COPIES AT PRESCRIBED RATES--
WRITE: Public Reference Section of the
Commission
450 Fifth Street, N.W., Washington,
D.C. 20549-6009
CALL: 1-800-SEC-0330.
VISIT: http://www.sec.gov.
---------------------------------------
No person is authorized to give any
information or representations about
this Fund not contained in this
Prospectus or the Information
Supplement, and you should not rely on
any other information.
---------------------------------------
When units of this Fund are no longer
available, this Prospectus may be used
as a preliminary prospectus for a
future series, but some of the
information in this Prospectus will be
changed for that series.
UNITS OF ANY FUTURE SERIES MAY NOT BE
SOLD NOR MAY OFFERS TO BUY BE ACCEPTED
UNTIL THAT SERIES HAS BECOME EFFECTIVE
WITH THE SECURITIES AND EXCHANGE
COMMISSION. NO UNITS CAN BE SOLD IN ANY
STATE WHERE A SALE WOULD BE ILLEGAL.
14862--9/00
</TABLE>
