<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 14, 1999
REGISTRATION NO. 33-55781
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- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------------------
POST-EFFECTIVE AMENDMENT NO. 4
TO
FORM S-6
------------------------------------------
FOR REGISTRATION UNDER THE SECURITIES ACT
OF 1933 OF SECURITIES OF UNIT INVESTMENT
TRUSTS REGISTERED ON FORM N-8B-2
------------------------------------------
A. EXACT NAME OF TRUST:
MUNICIPAL INVESTMENT TRUST FUND
MULTISTATE SERIES--75
DEFINED ASSET FUNDS
B. NAMES OF DEPOSITORS:
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
SALOMON SMITH BARNEY INC.
PRUDENTIAL SECURITIES INCORPORATED
PAINEWEBBER INCORPORATED
DEAN WITTER REYNOLDS INC.
C. COMPLETE ADDRESSES OF DEPOSITORS' PRINCIPAL EXECUTIVE OFFICES:
MERRILL LYNCH, PIERCE,
FENNER & SMITH
INCORPORATED
DEFINED ASSET FUNDS
POST OFFICE BOX 9051
PRINCETON, NJ 08543-9051 SALOMON SMITH BARNEY INC.
388 GREENWICH
STREET--23RD FLOOR
NEW YORK, NY 10013
PRUDENTIAL SECURITIES PAINEWEBBER INCORPORATED DEAN WITTER REYNOLDS INC.
INCORPORATED 1285 AVENUE OF THE TWO WORLD TRADE
ONE NEW YORK PLAZA AMERICAS CENTER--59TH FLOOR
NEW YORK, NY 10292 NEW YORK, NY 10019 NEW YORK, NY 10048
D. NAMES AND COMPLETE ADDRESSES OF AGENTS FOR SERVICE:
TERESA KONCICK, ESQ. ROBERT E. HOLLEY LAURIE A. HESSLEIN
P.O. BOX 9051 1200 HARBOR BLVD. 388 GREENWICH ST.
PRINCETON, NJ 08543-9051 WEEHAWKEN, NJ 07087 NEW YORK, NY 10013
LEE B. SPENCER, JR. COPIES TO: DOUGLAS LOWE, ESQ.
ONE NEW YORK PLAZA PIERRE DE SAINT PHALLE, DEAN WITTER REYNOLDS INC.
NEW YORK, NY 10292 ESQ. TWO WORLD TRADE
450 LEXINGTON AVENUE CENTER--59TH FLOOR
NEW YORK, NY 10017 NEW YORK, NY 10048
The issuer has registered an indefinite number of Units under the Securities Act
of 1933 pursuant to Rule 24f-2 and filed the Rule 24f-2 Notice for the most
recent fiscal year on March 10, 1998.
Check box if it is proposed that this filing will become effective on January
22, 1999 pursuant to paragraph (b) of Rule 485. / x /
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<PAGE>
DEFINED ASSET FUNDSSM
- --------------------------------------------
- ----------------------------------
MUNICIPAL INVESTMENT TRUST FUND
MULTISTATE SERIES--75
(A UNIT INVESTMENT TRUST)
O CALIFORNIA, FLORIDA, NEW JERSEY, NEW YORK,
OHIO AND PENNSYLVANIA PORTFOLIOS
O PORTFOLIOS OF INSURED LONG TERM MUNICIPAL
BONDS
O DESIGNED FOR FEDERALLY TAX-FREE INCOME
O EXEMPT FROM SOME STATE TAXES
O MONTHLY DISTRIBUTIONS
SPONSORS:
Merrill Lynch,
Pierce, Fenner & Smith -------------------------------------------------
Incorporated The Securities and Exchange Commission has not
Salomon Smith Barney Inc. approved or disapproved these Securities or
Prudential Securities passed upon the adequacy of this prospectus. Any
Incorporated representation to the contrary is a criminal
PaineWebber Incorporated offense.
Dean Witter Reynolds Inc. Prospectus dated January 22, 1999.
<PAGE>
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Defined Asset FundsSM
Defined Asset FundsSM is America's oldest and largest family of unit investment
trusts, with over $115 billion sponsored over the last 25 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:
o A disciplined strategy of buying and holding with a long-term view is the
cornerstone of Defined Asset Funds.
o Fixed portfolio: Defined Funds follow a buy and hold investment strategy;
funds are not managed and portfolio changes are limited.
o Defined Portfolios: We choose the stocks and bonds in advance, so you know
what you're investing in.
o Professional research: Our dedicated research team seeks out stocks or bonds
appropriate for a particular fund's objectives.
o 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 OCTOBER 31, 1998, THE
EVALUATION DATE.
CONTENTS
PAGE
-----------
California Insured Portfolio--
Risk/Return Summary.................................. 3
Florida Insured Portfolio-- Risk/Return Summary......... 6
New Jersey Insured Portfolio-- Risk/Return Summary...... 9
New York Insured Portfolio--
Risk/Return Summary.................................. 12
Ohio Insured Portfolio--
Risk/Return Summary.................................. 15
Pennsylvania Insured Portfolio--
Risk/Return Summary.................................. 18
What You Can Expect From Your Investment................ 23
Monthly Income....................................... 23
Return Figures....................................... 23
Records and Reports.................................. 23
The Risks You Face...................................... 24
Interest Rate Risk................................... 24
Call Risk............................................ 24
Reduced Diversification Risk......................... 24
Liquidity Risk....................................... 24
Concentration Risk................................... 24
State Concentration Risk............................. 25
Bond Quality Risk.................................... 28
Insurance Related Risk............................... 28
Litigation and Legislation Risks..................... 28
Selling or Exchanging Units............................. 28
Sponsors' Secondary Market........................... 29
Selling Units to the Trustee......................... 29
Exchange Option...................................... 29
How The Fund Works...................................... 30
Pricing.............................................. 30
Evaluations.......................................... 30
Income............................................... 30
Expenses............................................. 30
Portfolio Changes.................................... 31
Fund Termination..................................... 31
Certificates......................................... 31
Trust Indenture...................................... 31
Legal Opinion........................................ 32
Auditors............................................. 32
Sponsors............................................. 32
Trustee.............................................. 33
Underwriters' and Sponsors' Profits 33
Public Distribution.................................. 33
Code of Ethics....................................... 33
Year 2000 Issues..................................... 33
Taxes................................................... 33
Supplemental Information................................ 36
Financial Statements.................................... D-1
2
<PAGE>
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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?
O The Fund plans to hold to maturity 7 long-term tax-exempt
municipal bonds with an aggregate face amount of
$3,020,000.
o The Fund is a unit investment trust which means that,
unlike a mutual fund, the Portfolio is not managed.
o The bonds are rated AAA or Aaa by Standard & Poor's,
Moody's or Fitch.
o 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.
o 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:
APPROXIMATE
PORTFOLIO
PERCENTAGE
/ / Hospitals/Health Care 22%
/ / Housing 15%
/ / Lease Rental Appropriation 12%
/ / Municipal Water/Sewer Utilities 17%
/ / Refunded Bonds 18%
/ / Municipal Electric Utilities 17%
4. WHAT ARE THE SIGNIFICANT RISKS?
YOU CAN LOSE MONEY BY INVESTING IN THE FUND. THIS CAN
HAPPEN FOR VARIOUS REASONS, INCLUDING:
o Rising interest rates, an issuer's worsening financial
condition or a drop in bond ratings can reduce the price of
your units.
o 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.
o 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
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 $ 4.69
Annual Income per unit: $ 56.31
These figures are estimates determined on the evaluation
day; actual payments may vary.
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.
INVESTOR FEES
2.90%
Maximum Sales Fee (Load) on new purchases
(as a percentage of $1,000 invested)
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:
YOUR MAXIMUM
SALES FEE
IF YOU INVEST: WILL BE:
----------------------------------- -----------------
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%
ESTIMATED ANNUAL FUND OPERATING EXPENSES
AMOUNT
PER UNIT
-----------
$ 0.70
Trustee's Fee
$ 0.45
Portfolio Supervision,
Bookkeeping and
Administrative Fees
$ 0.48
Evaluator's Fee
$ 0.31
Other Operating Expenses
-----------
$ 1.94
TOTAL
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
between March 30, 1988 and September 27, 1996 and were
outstanding on September 30, 1998. 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 9/30/98.
WITH SALES FEE NO SALES FEE
1 YEAR 5 YEARS 10 YEARS 1 YEAR 5 YEARS 10 YEARS
- -------------------------------------------------------------------
High 6.54% 5.07% 7.45% 11.50% 6.15% 8.05%
Average 4.38 4.38 7.32 7.66 5.39 7.91
Low 2.62 3.84 7.19 4.39 4.75 7.68
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Average
Sales fee 3.18% 5.01% 5.70%
- -------------------------------------------------------------------
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.
UNIT PRICE PER UNIT $1,098.65
(as of October 31, 1998)
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>
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FLORIDA 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?
O The Fund plans to hold to maturity 7 long-term tax-exempt
municipal bonds with an aggregate face amount of
$2,080,000.
o The Fund is a unit investment trust which means that,
unlike a mutual fund, the Portfolio is not managed.
o The bonds are rated AAA or Aaa by Standard & Poor's,
Moody's or Fitch.
o 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.
o 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:
APPROXIMATE
PORTFOLIO
PERCENTAGE
/ / Hospitals/Health Care 24%
/ / Industrial Development Revenue 6%
/ / Lease Rental Appropriation 2%
/ / Municipal Water/Sewer Utilities 24%
/ / Refunded Bonds 22%
/ / Special Tax 22%
4. WHAT ARE THE SIGNIFICANT RISKS?
YOU CAN LOSE MONEY BY INVESTING IN THE FUND. THIS CAN
HAPPEN FOR VARIOUS REASONS, INCLUDING:
o Rising interest rates, an issuer's worsening financial
condition or a drop in bond ratings can reduce the price of
your units.
o 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.
o 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 FLORIDA SO
IT IS LESS DIVERSIFIED THAN A NATIONAL FUND AND IS SUBJECT
TO RISKS PARTICULAR TO FLORIDA 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 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
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 $ 4.14
Annual Income per unit: $ 49.79
These figures are estimates determined on the evaluation
day; actual payments may vary.
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.
INVESTOR FEES
2.90%
Maximum Sales Fee (Load) on new purchases
(as a percentage of $1,000 invested)
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:
YOUR MAXIMUM
SALES FEE
IF YOU INVEST: WILL BE:
----------------------------------- -----------------
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%
ESTIMATED ANNUAL FUND OPERATING EXPENSES
AMOUNT
PER UNIT
-----------
$ 0.57
Trustee's Fee
$ 0.38
Portfolio Supervision,
Bookkeeping and
Administrative Fees
$ 0.56
Evaluator's Fee
$ 0.47
Other Operating Expenses
-----------
$ 1.98
TOTAL
7. HOW HAVE SIMILAR FUNDS PERFORMED IN THE PAST?
In the following chart we show past performance of prior
Florida 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 Florida Series were offered
between April 20, 1988 and December 6, 1996 and were
outstanding on September 30, 1998. 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 9/30/98.
WITH SALES FEE NO SALES FEE
1 YEAR 5 YEARS 1 YEAR 5 YEARS
- ---------------------------------------------------------------
High 6.79% 5.03% 11.75% 6.22%
Average 4.12 4.34 7.49 5.39
Low 2.01 3.81 4.00 4.81
- -------------------------------------------------------------------
Average 3.30% 5.17%
Sales fee
- -------------------------------------------------------------------
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.
UNIT PRICE PER UNIT $932.63
(as of October 31, 1998)
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 Florida state and local taxes if you live
in Florida.
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>
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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?
O The Fund plans to hold to maturity long-term tax-exempt
municipal bonds with an aggregate face amount of
$2,460,000.
o The Fund is a unit investment trust which means that,
unlike a mutual fund, the Portfolio is not managed.
o The bonds are rated AAA or Aaa by Standard & Poor's,
Moody's or Fitch.
o 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.
o The Fund is concentrated in refunded bonds.
o 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:
APPROXIMATE
PORTFOLIO
PERCENTAGE
/ / Hospitals/Health Care 8%
/ / Housing 20%
/ / Industrial Development Revenue 36%
/ / Refunded Bonds 36%
4. WHAT ARE THE SIGNIFICANT RISKS?
YOU CAN LOSE MONEY BY INVESTING IN THE FUND. THIS CAN
HAPPEN FOR VARIOUS REASONS, INCLUDING:
o Rising interest rates, an issuer's worsening financial
condition or a drop in bond ratings can reduce the price of
your units.
o Because the Fund is concentrated in industrial development
revenue bonds, adverse developments in this sector may
affect the value of your units.
o 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.
o 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
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 $ 5.10
Annual Income per unit: $ 61.30
These figures are estimates determined on the evaluation
day; actual payments may vary.
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.
INVESTOR FEES
2.90%
Maximum Sales Fee (Load) on new purchases
(as a percentage of $1,000 invested)
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:
YOUR MAXIMUM
SALES FEE
IF YOU INVEST: WILL BE:
----------------------------------- -----------------
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%
ESTIMATED ANNUAL FUND OPERATING EXPENSES
AMOUNT
PER UNIT
-----------
$ 0.69
Trustee's Fee
$ 0.44
Portfolio Supervision,
Bookkeeping and
Administrative Fees
$ 0.57
Evaluator's Fee
$ 0.47
Other Operating Expenses
-----------
$ 2.17
TOTAL
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
between March 30, 1988 and August 1, 1996 and were
outstanding on September 30, 1998. 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 9/30/98.
WITH SALES FEE NO SALES FEE
1 YEAR 5 YEARS 10 YEARS 1 YEAR 5 YEARS 10 YEARS
- -------------------------------------------------------------------
High 5.85% 4.70% 7.28% 10.78% 5.88% 7.88%
Average 4.15 4.23 7.20 7.29 5.28 7.80
Low 3.11 3.79 7.12 4.52 4.74 7.72
- -------------------------------------------------------------------
Average
Sales fee 3.04% 5.19% 5.82%
- -------------------------------------------------------------------
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.
UNIT PRICE PER UNIT $1,130.76
(as of October 31, 1998)
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>
- --------------------------------------------------------------------------------
NEW YORK 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?
O The Fund plans to hold to maturity 9 long-term tax-exempt
municipal bonds with an aggregate face amount of
$8,745,000.
o The Fund is a unit investment trust which means that,
unlike a mutual fund, the Portfolio is not managed.
o The bonds are rated AAA or Aaa by Standard & Poor's,
Moody's or Fitch.
o 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.
o The Fund is concentrated in refunded bonds.
o 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:
APPROXIMATE
PORTFOLIO
PERCENTAGE
/ / Housing 11%
/ / Industrial Development Revenue 16%
/ / Municipal Water/Sewer Utilities 17%
/ / Refunded Bonds 38%
/ / Transit/Transportation 10%
/ / Universities/Colleges 8%
4. WHAT ARE THE SIGNIFICANT RISKS?
YOU CAN LOSE MONEY BY INVESTING IN THE FUND. THIS CAN
HAPPEN FOR VARIOUS REASONS, INCLUDING:
o Rising interest rates, an issuer's worsening financial
condition or a drop in bond ratings can reduce the price of
your units.
o 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.
o 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 YORK SO
IT IS LESS DIVERSIFIED THAN A NATIONAL FUND AND IS SUBJECT
TO RISKS PARTICULAR TO NEW YORK WHICH ARE BRIEFLY DESCRIBED
UNDER STATE CONCENTRATION RISKS LATER IN THIS PROSPECTUS.
12
<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
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 $ 4.82
Annual Income per unit: $ 57.93
These figures are estimates determined on the evaluation
day; actual payments may vary.
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.
INVESTOR FEES
2.90%
Maximum Sales Fee (Load) on new purchases
(as a percentage of $1,000 invested)
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:
YOUR MAXIMUM
SALES FEE
IF YOU INVEST: WILL BE:
----------------------------------- -----------------
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%
ESTIMATED ANNUAL FUND OPERATING EXPENSES
AMOUNT
PER UNIT
-----------
$ 0.70
Trustee's Fee
$ 0.45
Portfolio Supervision,
Bookkeeping and
Administrative Fees
$ 0.16
Evaluator's Fee
$ 0.17
Other Operating Expenses
-----------
$ 1.48
TOTAL
7. HOW HAVE SIMILAR FUNDS PERFORMED IN THE PAST?
In the following chart we show past performance of prior New
York 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 York Series were offered between
January 14, 1988 and September 11, 1997 and were outstanding
on September 30, 1998. 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 9/30/98.
WITH SALES FEE NO SALES FEE
1 YEAR 5 YEARS 10 YEARS 1 YEAR 5 YEARS 10 YEARS
- -------------------------------------------------------------------
High 6.94% 5.26% 7.87% 11.62% 6.02% 8.47%
Average 4.47 4.41 7.51 7.72 5.44 8.10
Low 2.18 3.81 7.37 4.79 4.76 7.59
- -------------------------------------------------------------------
Average
Sales fee 3.17% 5.11% 5.73%
- -------------------------------------------------------------------
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.
13
<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.
UNIT PRICE PER UNIT $1,110.99
(as of October 31, 1998)
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 York state and local personal income
taxes if you live in New York.
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.
14
<PAGE>
- --------------------------------------------------------------------------------
OHIO 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?
O The Fund plans to hold to maturity 7 long-term tax-exempt
municipal bonds with an aggregate face amount of
$2,785,000.
o The Fund is a unit investment trust which means that,
unlike a mutual fund, the Portfolio is not managed.
o The bonds are rated AAA or Aaa by Standard & Poor's,
Moody's or Fitch.
o 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.
o The Fund is concentrated in refunded bonds.
o 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:
APPROXIMATE
PORTFOLIO
PERCENTAGE
/ / General Obligation 16%
/ / Municipal Water/Sewer Utilities 17%
/ / Refunded Bonds 43%
/ / Municipal Electric Utilities 6%
/ / Universities/Colleges 18%
4. WHAT ARE THE SIGNIFICANT RISKS?
YOU CAN LOSE MONEY BY INVESTING IN THE FUND. THIS CAN
HAPPEN FOR VARIOUS REASONS, INCLUDING:
o Rising interest rates, an issuer's worsening financial
condition or a drop in bond ratings can reduce the price of
your units.
o 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.
o 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 OHIO SO IT
IS LESS DIVERSIFIED THAN A NATIONAL FUND AND IS SUBJECT TO
RISKS PARTICULAR TO OHIO WHICH ARE BRIEFLY DESCRIBED UNDER
STATE CONCENTRATION RISKS LATER IN THIS PROSPECTUS.
15
<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
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 $ 5.24
Annual Income per unit: $ 62.99
These figures are estimates determined on the evaluation
day; actual payments may vary.
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.
INVESTOR FEES
2.90%
Maximum Sales Fee (Load) on new purchases
(as a percentage of $1,000 invested)
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:
YOUR MAXIMUM
SALES FEE
IF YOU INVEST: WILL BE:
----------------------------------- -----------------
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%
ESTIMATED ANNUAL FUND OPERATING EXPENSES
AMOUNT
PER UNIT
-----------
$ 0.69
Trustee's Fee
$ 0.45
Portfolio Supervision,
Bookkeeping and
Administrative Fees
$ 0.51
Evaluator's Fee
$ 0.37
Other Operating Expenses
-----------
$ 2.02
TOTAL
7. HOW HAVE SIMILAR FUNDS PERFORMED IN THE PAST?
In the following chart we show past performance of prior
Ohio 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 Ohio Series were offered between July 28,
1988 and July 11, 1996 and were outstanding on September 30,
1998. 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 9/30/98.
WITH SALES FEE NO SALES FEE
1 YEAR 5 YEARS 1 YEAR 5 YEARS
- ---------------------------------------------------------------
High 6.67% 4.74% 11.25% 5.91%
Average 4.13 4.21 7.01 5.26
Low 2.71 3.76 4.45 4.73
- ---------------------------------------------------------------
Average
Sales fee 2.89% 5.24%
- ----------------------------------------------------------------
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.
16
<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.
UNIT PRICE PER UNIT $1,154.27
(as of October 31, 1998)
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 Ohio state and local personal income taxes
if you live in Ohio.
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.
17
<PAGE>
- --------------------------------------------------------------------------------
PENNSYLVANIA 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?
O The Fund plans to hold to maturity 7 long-term tax-exempt
municipal bonds with an aggregate face amount of
$2,595,000.
o The Fund is a unit investment trust which means that,
unlike a mutual fund, the Portfolio is not managed.
o The bonds are rated AAA or Aaa by Standard & Poor's,
Moody's or Fitch.
o 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.
o The Fund is concentrated in refunded bonds.
o 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:
APPROXIMATE
PORTFOLIO
PERCENTAGE
/ / Hospitals/Health Care 19%
/ / Industrial Development Revenue 18%
/ / Municipal Water/Sewer Utilities 12%
/ / Refunded Bonds 25%
/ / Municipal Electric Utilities 19%
/ / Universities/Colleges 7%
4. WHAT ARE THE SIGNIFICANT RISKS?
YOU CAN LOSE MONEY BY INVESTING IN THE FUND. THIS CAN
HAPPEN FOR VARIOUS REASONS, INCLUDING:
o Rising interest rates, an issuer's worsening financial
condition or a drop in bond ratings can reduce the price of
your units.
o 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.
o 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
PENNSYLVANIA SO IT IS LESS DIVERSIFIED THAN A NATIONAL FUND
AND IS SUBJECT TO RISKS PARTICULAR TO PENNSYLVANIA WHICH
ARE BRIEFLY DESCRIBED UNDER STATE CONCENTRATION RISKS LATER
IN THIS PROSPECTUS.
18
<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
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 $ 4.98
Annual Income per unit: $ 59.85
These figures are estimates determined on the evaluation
day; actual payments may vary.
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.
INVESTOR FEES
2.90%
Maximum Sales Fee (Load) on new purchases
(as a percentage of $1,000 invested)
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:
YOUR MAXIMUM
SALES FEE
IF YOU INVEST: WILL BE:
----------------------------------- -----------------
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%
ESTIMATED ANNUAL FUND OPERATING EXPENSES
AMOUNT
PER UNIT
-----------
$ 0.69
Trustee's Fee
$ 0.44
Portfolio Supervision,
Bookkeeping and
Administrative Fees
$ 0.55
Evaluator's Fee
$ 0.43
Other Operating Expenses
-----------
$ 2.11
TOTAL
7. HOW HAVE SIMILAR FUNDS PERFORMED IN THE PAST?
In the following chart we show past performance of prior
Pennsylvania 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 Pennsylvania Series were
offered between March 4, 1988 and September 11, 1997 and
were outstanding on September 30, 1998. 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 9/30/98.
WITH SALES FEE NO SALES FEE
1 YEAR 5 YEARS 10 YEARS 1 YEAR 5 YEARS 10 YEARS
- -------------------------------------------------------------------
High 6.45% 5.08% 7.33% 10.73% 6.08% 7.93%
Average 3.97 4.31 7.28 7.24 5.35 7.86
Low 2.42 3.72 7.22 3.61 4.76 7.76
- -------------------------------------------------------------------
Average
Sales fee 3.20% 5.12% 5.60%
- -------------------------------------------------------------------
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.
19
<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.
UNIT PRICE PER UNIT $1,107.79
(as of October 31, 1998)
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 Pennsylvania state and local personal
income taxes if you live in Pennsylvania.
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.
20
<PAGE>
- --------------------------------------------------------------------------------
TAX-FREE VS. TAXABLE INCOME: A COMPARISON OF TAXABLE AND TAX-FREE YIELDS
FOR CALIFORNIA RESIDENTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COMBINED
EFFECTIVE
TAXABLE INCOME 1998* TAX RATE TAX-FREE YIELD OF
SINGLE RETURN JOINT RETURN % 3% 3.5% 4% 4.5% 5% 5.5% 6% 6.5%
IS EQUIVALENT TO A TAXABLE YIELD OF
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 0- 25,350 $ $0- 42,350 20.10 3.75 4.38 5.01 5.63 6.26 6.88 7.51 8.14
$ 25,351- 61,400 $ 42,351-102,300 34.70 4.59 5.36 6.13 6.89 7.66 8.42 9.19 9.95
$ 61,401-128,100 $102,301-155,950 37.42 4.79 5.59 6.39 7.19 7.99 8.79 9.59 10.39
$128,101-278,450 $155,951-278,450 41.95 5.17 6.03 6.89 7.75 8.61 9.47 10.34 11.20
OVER $278,450 OVER $278,450 45.22 5.48 6.39 7.30 8.21 9.13 10.04 10.95 11.87
</TABLE>
FOR FLORIDA RESIDENTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
EFFECTIVE
TAXABLE INCOME 1998* TAX RATE TAX-FREE YIELD OF
SINGLE RETURN JOINT RETURN % 3% 3.5% 4% 4.5% 5% 5.5% 6% 6.5% 7%
IS EQUIVALENT TO A TAXABLE YIELD OF
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 0- 25,350 $ 0- 42,350 15.00 3.53 4.12 4.71 5.29 5.88 6.47 7.06 7.65 8.24
$ 25,350- 61,400 $ 42,350-102,300 28.00 4.17 4.86 5.56 6.25 6.94 7.64 8.33 9.03 9.72
$ 61,400-128,100 $102,300-155,950 31.00 4.35 5.07 5.80 6.52 7.25 7.97 8.70 9.42 10.14
$128,100-278,450 $155,950-278,450 36.00 4.69 5.47 6.25 7.03 7.81 8.59 9.38 10.16 10.94
OVER $278,450 OVER $278,450 39.60 4.97 5.79 6.62 7.45 8.28 9.11 9.93 10.76 11.59
</TABLE>
FOR NEW JERSEY RESIDENTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COMBINED
EFFECTIVE
TAXABLE INCOME 1998* TAX RATE TAX-FREE YIELD OF
SINGLE RETURN JOINT RETURN % 3% 3.5% 4% 4.5% 5% 5.5% 6% 6.5%
IS EQUIVALENT TO A TAXABLE YIELD OF
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 0- 42,350 17.08 3.62 4.22 4.82 5.43 6.03 6.63 7.24 7.84
$ 0- 25,350 17.98 3.66 4.27 4.88 5.49 6.10 6.71 7.31 7.92
$ 25,351- 61,400 $ 42,351-102,300 31.98 4.41 5.15 5.88 6.62 7.35 8.09 8.82 9.56
$ 61,401-128,100 $102,301-155,950 35.40 4.64 5.42 6.19 6.97 7.74 8.51 9.29 10.06
$128,101-278,450 $155,951-278,450 40.08 5.01 5.84 6.68 7.51 8.34 9.18 10.01 10.85
OVER $278,450 OVER $278,450 43.45 5.30 6.19 7.07 7.96 8.84 9.73 10.61 11.49
</TABLE>
FOR OHIO RESIDENTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COMBINED
EFFECTIVE
TAXABLE INCOME 1998* TAX RATE TAX-FREE YIELD OF
SINGLE RETURN JOINT RETURN % 3% 3.5% 4% 4.5% 5% 5.5% 6% 6.5%
IS EQUIVALENT TO A TAXABLE YIELD OF
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 0- 42,350 19.24 3.71 4.33 4.95 5.57 6.19 6.81 7.43 8.06
$ 0- 25,350 18.84 3.89 4.30 4.92 5.53 6.16 6.78 7.37 7.99
$ 42,350-102,300 32.77 4.46 5.21 5.95 6.89 7.44 8.18 8.92 9.67
$ 25,350- 61,400 31.69 4.39 6.12 5.85 6.58 7.76 8.64 8.81 10.09
$ 61,400-128,100 $102,300-155,950 35.57 4.86 5.43 6.21 6.98 7.76 8.64 9.31 10.09
$128,100-278,450 $155,950-278,450 40.61 5.05 5.89 6.73 7.68 8.42 9.28 10.10 10.84
OVER $278,450 OVER $278,450 43.95 5.36 6.24 7.14 8.03 8.92 9.81 10.70 11.60
</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 1998
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.
21
<PAGE>
- --------------------------------------------------------------------------------
TAX-FREE VS. TAXABLE INCOME: A COMPARISON OF TAXABLE AND TAX-FREE YIELDS
FOR NEW YORK CITY RESIDENTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COMBINED
EFFECTIVE
TAXABLE INCOME 1998* TAX RATE TAX-FREE YIELD OF
SINGLE RETURN JOINT RETURN % 3% 3.5% 4% 4.5% 5% 5.5% 6% 6.5%
IS EQUIVALENT TO A TAXABLE YIELD OF
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 0- 25,350 $ 0- 42,350 24.55 3.38 4.64 5.30 5.96 6.63 7.29 7.95 8.62
$ 25,351- 61,400 $ 42,351-102,300 36.14 4.70 5.48 6.28 7.05 7.83 8.61 9.40 10.18
$ 61,401-128,100 $102,301-155,950 38.80 4.90 5.72 6.54 7.35 8.17 8.99 9.80 10.62
$128,101-278,450 $155,951-278,450 43.24 5.29 6.17 7.05 7.83 8.81 9.69 10.57 11.45
OVER $278,450 OVER $278,450 46.43 5.60 6.53 7.47 8.40 9.33 10.27 11.20 12.13
</TABLE>
FOR NEW YORK STATE RESIDENTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COMBINED
EFFECTIVE
TAXABLE INCOME 1998* TAX RATE TAX-FREE YIELD OF
SINGLE RETURN JOINT RETURN % 3% 3.5% 4% 4.5% 5% 5.5% 6% 6.5%
IS EQUIVALENT TO A TAXABLE YIELD OF
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 0- 25,350 $ 0- 42,350 20.82 3.79 4.42 5.05 5.68 6.31 6.95 7.58 8.21
$ 25,351- 61,400 $ 42,351-102,300 32.93 4.47 5.22 5.96 6.71 7.46 8.20 8.95 9.69
$ 61,401-128,100 $102,301-155,950 35.73 4.67 5.45 6.22 7.00 7.78 8.56 9.34 10.11
$128,101-278,450 $155,951-278,450 40.38 5.03 5.87 6.71 7.55 8.39 9.23 10.06 10.90
OVER $278,450 OVER $278,450 43.74 5.33 6.22 7.11 8.00 8.89 9.78 10.66 11.55
</TABLE>
FOR PENNSYLVANIA RESIDENTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COMBINED
EFFECTIVE
TAXABLE INCOME 1998* TAX RATE TAX-FREE YIELD OF
SINGLE RETURN JOINT RETURN % 3% 3.5% 4% 4.5% 5% 5.5% 6% 6.5% 7%
IS EQUIVALENT TO A TAXABLE YIELD OF
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 0- 25,350 $ 0- 42,350 17.38 3.63 4.24 4.84 5.45 6.05 6.66 7.26 7.87 8.47
$ 25,350- 61,400 $ 42,350-102,300 30.02 4.29 5.00 5.72 6.43 7.14 7.86 8.57 9.29 10.00
$ 61,400-128,100 $102,300-155,950 32.93 4.47 5.22 5.96 6.71 7.46 8.20 8.95 9.69 10.44
$128,100-278,450 $155,940-278,450 37.79 4.82 5.63 6.43 7.23 8.04 8.84 9.65 10.45 11.25
OVER $278,450 OVER $278,450 41.29 5.11 5.96 6.81 7.66 8.52 9.37 10.22 11.07 11.92
</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 1998
federal and applicable State (and City) 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, investors are urged to consult their own tax advisers
in this regard.
22
<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:
o elimination of one or more bonds from the Fund's portfolio because of
calls, redemptions or sales;
o a change in the Fund's expenses; or
o 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):
Estimated Annual Estimated
Interest Income - Annual Expenses
- -------------------------------------------------
Unit Price
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:
o a monthly statement of income payments and any principal payments;
o a notice from the Trustee when new bonds are deposited in exchange or
substitution for bonds originally deposited;
o an annual report on Fund activity; and
o 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:
o copies of bond evaluations to enable you to comply with federal and state tax
reporting requirements; and
o audited financial statements of the Fund.
You may inspect records of Fund transactions at the Trustee's office during
regular business hours.
23
<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:
o it no longer needs the money for the original purpose;
o the project is condemned or sold;
o the project is destroyed and insurance proceeds are used to redeem the
bonds;
o any related credit support expires and is not replaced; or
o 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 New Jersey 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:
o creditworthiness of the corporate operator of the project being financed;
o economic factors relating to the particular industry; and,
o in some cases, creditworthiness of an affiliated or third-party guarantor.
Here is what you should know about the New Jersey, New York, Ohio and
Pennsylvania Portfolios' concentrations in refunded bonds. Refunded bonds are
typically:
o backed by direct obligations of the U.S. government; or
24
<PAGE>
o in some cases, backed by obligations guaranteed by the U.S. government and
placed in escrow with an independent trustee;
o noncallable prior to maturity; but
o sometimes called for redemption prior to maturity.
Changes to the portfolio from bond redemptions, maturities and sales may affect
the Fund's concentrations over time.
STATE CONCENTRATION RISK
CALIFORNIA RISKS
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.
o As a result California experienced a period of sustained budget imbalance.
o Since that time the California economy has improved and the extreme
budgetary pressures have begun to lessen.
State Government
The 1997-98 Budget Act allocated a State budget of approximately $66.9 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:
o 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 is still unknown.
o 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 issuers' ability to pay their debts.
o California's general obligation bonds are currently rated A1 by Moody's and
A+ 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:
o Certain provisions of California's Constitution, laws and regulatory system
contain tax, spending and appropriations limits and prohibit certain new
taxes.
o Certain other California laws subject the users of bond proceeds to strict
rules and limits regarding revenue repayment.
o 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 affected by these
provisions.
FLORIDA RISKS
Generally
Florida's financial condition is affected by numerous national, economic, social
and environmental policies and conditions. For example:
o south Florida is heavily involved with foreign tourism, trade and
investment capital. As a result, the region is susceptible to international
trade and currency imbalances and economic problems in Central and South
America;
25
<PAGE>
o central and northern Florida are more vulnerable to agricultural problems,
such as crop failures or severe weather conditions, especially in the
citrus and sugar industries; and
o the state as a whole is also very dependent on tourism and construction.
State and Local Government
The state of Florida and its local governments are restricted in their ability
to raise taxes and incur debts. These restrictions limit their ability to
generate revenue, and so could hurt their ability to pay debts.
General obligations of the state are rated Aa2 by Moody's, AA+ by Standard &
Poor's and AA by Fitch.
NEW JERSEY RISKS
State and Local Government
Certain features of New Jersey law could affect the repayment of debt:
o 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
o 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
o elementary and secondary education, and
o 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.
NEW YORK RISKS
Generally
For decades, New York's economy has trailed the rest of the nation. Both the
state and New York City have experienced long-term structural imbalances between
revenues and expenses, and have repeatedly relied substantially on non-recurring
measures to achieve budget balance. The pressures that contribute to budgetary
problems at both the state and local level include:
o the high combined state and local tax burden;
o a decline in manufacturing jobs, leading to above-average unemployment;
o sensitivity to the financial services industry; and
o dependence on federal aid.
State Government
The State government frequently has difficulty approving budgets on time. Budget
gaps of $1 billion and $4 billion are projected for the next two years. The
State's general obligation bonds are rated A by Standard & Poor's and A2 by
Moody's. There is $37 billion of state-related debt outstanding.
New York City Government
Even though the City had budget surpluses each year from 1981, budget gaps of $2
billion are projected for each of the next three years. New York City faces
fiscal pressures from:
o aging public facilities that need repair or replacement;
26
<PAGE>
o welfare and medical costs;
o expiring labor contracts; and
o a high and increasing debt burden.
The City requires substantial state aid, and its fiscal strength depends heavily
on the securities industry. Its general obligation bonds are rated A-by Standard
& Poor's and A3 by Moody's.
OHIO RISKS
Generally
Overall, Ohio's economy is more cyclical than non-industrial states and the
nation as a whole:
o manufacturing (especially auto-related manufacturing) is an important part
of Ohio's economy.
o agriculture and related industries are also very important.
o recent employment growth has been in non-manufacturing areas.
State Government
The Ohio general revenue fund for the current two-year period calls for
expenditures of over $36 billion:
o because general fund receipts and payments do not match exactly, temporary
cash-flow deficiencies occur throughout the year. Ohio law permits the
state government to manage this problem by permitting the adjustment of
payment schedules and the use of the total operating fund.
o Ohio's general obligation bonds are currently rated Aa1 by Moody's; AA+ by
Standard & Poor's (except for the State's highway bonds which Standard &
Poor's rates AAA). Fitch rates Ohio's general obligation bonds and its
highway bonds AA+. Any of these ratings may be changed.
o Ohio voters have authorized the State to incur debt to which taxes or
excises are pledged for payment.
Education Financing
In March of 1997, the Ohio Supreme Court found major parts of the state's school
funding system to be unconstitutional. The Court ruled that, although property
taxes can play a role in school financing, they can no longer be the primary
means of school financing. The court stayed its ruling for one year to allow the
State to devise a system that complied with the State's constitution. During
that stay, repayment provisions of certain bonds issued for school funding will
remain valid.
PENNSYLVANIA RISKS
Generally
Pennsylvania and many of its municipalities (including Philadelphia) have
undergone an economic decline:
o coal, steel, railroads and other heavy industry historically associated
with the Commonwealth has given way to increased competition from foreign
producers.
o agriculture and related industries are still an important part of the
Commonwealth's economy.
o Recently, however, service sector industries (trade, medical and health
services, education and financial services) have provided new sources of
growth.
State and Local Governments
Historically, both the Commonwealth and the City of Philadelphia have
experienced serious revenue shortfalls. At the same time, rising demands for
state and local programs and
27
<PAGE>
services (particularly medical assistance and cash assistance programs) have
lead to increased spending.
o In recent years, both the Commonwealth and the City of Philadelphia have
tried to balance their budgets with a mix of tax increases and spending
cuts.
o Philadelphia has considered significant service cuts and privatization of
certain services which it has provided to date.
o In 1991, the Commonwealth created the Pennsylvania Inter-Governmental
Cooperation Authority ('PICA') which it authorized to issue debt to cover
Philadelphia's budget shortfalls, eliminate the City's projected deficits
and fund its capital spending. PICA issued approximately $1.76 billion of
Special Revenue Bonds on Philadelphia's behalf. Its power to issue bonds on
Philadelphia's behalf expired at the end of 1996; as of June 30, 1997,
approximately $1.1 billion in PICA Special Revenue Bonds were outstanding.
o Pennsylvania's general obligation bonds are currently rated A1 by Moody's
and AA-by Standard & Poor's. Philadelphia's general obligation bonds are
rated Baa by Moody's and BBB by Standard & Poor's. There can be no
assurance that these ratings will not be lowered.
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
The 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.
Future tax legislation could affect the value of the portfolio by:
o limiting real property taxes,
o reducing tax rates,
o imposing a flat or other form of tax, or
o 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:
o adding the value of the bonds, net accrued interest, cash and any other
Fund assets;
o 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
o 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.
28
<PAGE>
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 25 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.
There could be a delay in paying you for your units:
o if the New York Stock Exchange is closed (other than customary weekend and
holiday closings);
o 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
o 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. 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.
29
<PAGE>
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.
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:
o to reimburse the Trustee for the Fund's operating expenses;
o for extraordinary services and costs of indemnifying the Trustee and the
Sponsors;
o costs of actions taken to protect the Fund and other legal fees and
expenses;
o expenses for keeping the Fund's registration statement current; and
o Fund termination expenses and any governmental charges.
The Sponsors are currently reimbursed up to 45 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. 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
30
<PAGE>
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 will affect the size
and 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:
o diversity of the portfolio;
o size of the Fund relative to its original size;
o ratio of Fund expenses to income;
o current and long-term returns;
o degree to which units may be selling at a premium over par; and
o cost of maintaining a current prospectus.
FUND TERMINATION
The Fund will terminate following the stated maturity or sale of the last bond
in the 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.
31
<PAGE>
The Sponsors and the Trustee may amend the Indenture without your consent:
o to cure ambiguities;
o to correct or supplement any defective or inconsistent provision;
o to make any amendment required by any governmental agency; or
o 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:
o it fails to perform its duties and the Sponsors determine that its
replacement is in your best interest; or
o 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 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:
o remove it and appoint a replacement Sponsor;
o liquidate the Fund; or
o 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
32
<PAGE>
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 Bank of New York, 101 Barclay Street, 17 W, New York, New York 10268, is the
Trustee. It is supervised by the Federal Deposit Insurance Corporation, the
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
Merrill Lynch, as agent for the Sponsors, has adopted a code of ethics requiring
preclearance and reporting of personal securities transactions by its employees
with access to information on portfolio transactions. The goal of the code is to
prevent fraud, deception or misconduct against the Fund and to provide
reasonable standards of conduct.
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'). We do not expect that the computer system changes necessary to
prepare for the Year 2000 will cause any major operational difficulties for the
Fund.
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. 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 federal
alternative minimum tax. 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 issuer (or other
33
<PAGE>
users) 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.
INCOME 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 if you held
it for one year or less. If you are an individual and sell your units after
holding them for more than one year, you may be entitled to a 20% maximum
federal tax rate on any resulting gains. Consult your tax adviser in this
regard. 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 and the organizational expenses 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.
STATE AND LOCAL TAXES
Under the income tax laws of the State and City of New York, the Fund will not
be taxed as a corporation. If you are a New York taxpayer, your income from the
Fund will not be tax-exempt in New York except to the extent that the income is
earned on bonds that are tax-exempt for New York purposes. Depending on where
you live, your income from the Fund may be subject to state and local taxation.
You should consult your tax adviser in this regard.
CALIFORNIA TAXES
In the opinion of O'Melveny & Myers LLP, Los Angeles, California, special
counsel on California tax matters:
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
34
<PAGE>
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.
FLORIDA TAXES
In the opinion of Greenberg, Traurig, P.A., Miami, Florida, special counsel on
Florida tax matters:
Under the income tax laws of the State of Florida, the Fund will not be taxed as
a corporation. Florida imposes an income tax on corporations but does not impose
a personal income tax. Accordingly, if you are an individual taxpayer your
income from the Fund will not be subject to tax in Florida. However, if you are
an entity that is normally taxed as a corporation, your income from the fund
will not be exempt from tax in Florida and special rules for taxation apply
depending on the type of entity. You should consult your tax adviser in this
regard.
Florida also imposes a tax on intangible personal property, such as stocks,
bonds, notes and units in trusts. The tax is imposed on Florida taxpayers as of
January 1st of each year. Florida exempts certain types of bonds and debt
obligations from this tax. Your units will be exempt from the intangible
personal property tax as long as the Fund invests exclusively in bonds and other
debt obligations that are tax-exempt for Florida purposes.
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.
OHIO TAXES
In the opinion of Vorys, Sater, Seymour and Pease LLP, Columbus, Ohio, special
counsel on Ohio tax matters:
Under the laws of the State of Ohio, the Ohio Trust will not be subject to the
Ohio corporation franchise tax or the Ohio tax on dealers in intangibles. If you
are an Ohio taxpayer, your interest income from the Ohio Trust will be exempt
from Ohio personal income taxes and Ohio corporation franchise taxes to the
extent it relates to bonds held by the Ohio Trust that are exempt from taxation
under Ohio law. However, any gains and losses which must be recognized for
federal income tax purposes (whether upon the sale of your units in the Ohio
Trust or upon the sale of bonds by the Ohio Trust) also must be recognized for
Ohio personal income and corporation franchise tax purposes, except to the
extent the gains and losses are attributable to the sale of bonds by the Ohio
Trust that are exempt from such taxation under Ohio law.
35
<PAGE>
Your interest income and your gains and losses generally are not subject to
municipal income taxation in Ohio. You should consult your tax adviser
concerning the application of Ohio taxes to you in connection with your
investment in the Ohio Trust.
PENNSYLVANIA TAXES
In the opinion of Drinker Biddle & Reath LLP, Philadelphia, Pennsylvania,
special counsel on Pennsylvania tax matters:
The Pennsylvania Trust will not be taxed as a corporation under the current
income tax laws of Pennsylvania. Your income from the Trust may be subject to
taxation depending on where you live. If you are a Pennsylvania taxpayer your
interest income from the Trust will be tax exempt to the extent that income is
earned on bonds that are tax exempt for Pennsylvania purposes. However, gains on
the sale of bonds by the Trust or on the sale of your Units will be subject to
Pennsylvania income tax. If you are a Philadelphia resident you may be subject
to the Philadelphia school district tax on any gains realized from the sale of
bonds by the Trust or the sale of Units by you to the extent either the bonds or
Units have been held for six months or less. You should consult your tax adviser
as to the consequences to you with respect to any investment you make in the
Trust.
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.
36
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (CALIFORNIA, FLORIDA, NEW JERSEY, NEW YORK,
OHIO AND PENNSYLVANIA TRUSTS),
DEFINED ASSET FUNDS
REPORT OF INDEPENDENT ACCOUNTANTS
The Sponsors, Trustee and Holders
of Municipal Investment Trust Fund,
Multistate Series - 75 (California, Florida, New Jersey, New York,
Ohio and Pennsylvania Trusts)
Defined Asset Funds:
We have audited the accompanying statements of condition of Municipal
Investment Trust Fund, Multistate Series - 75 (California, Florida,
New Jersey, New York, Ohio and Pennsylvania Trusts), Defined Asset
Funds, including the portfolios, as of October 31, 1998 and the
related statements of operations and of changes in net assets for the
years ended October 31, 1998, 1997 and 1996. 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 generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. Securities owned at October 31, 1998, as shown
in such portfolios, were confirmed to us by The Bank of New York, 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 Municipal
Investment Trust Fund, Multistate Series - 75 (California, Florida,
New Jersey, New York, Ohio and Pennsylvania Trusts), Defined Asset
Funds at October 31, 1998 and the results of their operations and
changes in their net assets for the above-stated years in conformity
with generally accepted accounting principles.
DELOITTE & TOUCHE LLP
New York, N.Y.
December 28, 1998
D - 1
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (CALIFORNIA TRUST),
DEFINED ASSET FUNDS
STATEMENT OF CONDITION
AS OF OCTOBER 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C>
TRUST PROPERTY:
Investment in marketable securities - at value
(cost $2,590,621)(Note 1)...................... $3,240,368
Accrued interest receivable...................... 34,027
Cash............................................. 10,257
_____________
Total trust property................. 3,284,652
LESS LIABILITY - Accrued expenses.................. 2,485
_____________
NET ASSETS, REPRESENTED BY:
3,029 units of fractional undivided
interest outstanding (Note 3).................. $3,242,636
Undistributed net investment income.............. 39,531
_____________
$3,282,167
=============
UNIT VALUE ($3,282,167/3,029 units)................ $1,083.58
=============
</TABLE>
See Notes to Financial Statements.
D - 2
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (CALIFORNIA TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
.......Years Ended October 31,..........
1998 1997 1996
_________________________________________
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income........................... $178,706 $186,541 $190,500
Trustee's fees and expenses............... (4,690) (5,440) (5,931)
Sponsors' fees............................ (1,385) (1,442) (1,733)
_________________________________________
Net investment income..................... 172,631 179,659 182,836
_________________________________________
REALIZED AND UNREALIZED GAIN
ON INVESTMENTS:
Realized gain on securities
sold or redeemed........................ 24,398 9,772
Unrealized appreciation of investments.... 76,283 104,981 43,683
_________________________________________
Net realized and unrealized gain on
investments............................. 100,681 114,753 43,683
_________________________________________
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS........................... $273,312 $294,412 $226,519
=========================================
</TABLE>
See Notes to Financial Statements.
D - 3
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (CALIFORNIA TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
.......Years Ended October 31,..........
1998 1997 1996
_________________________________________
<S> <C> <C> <C>
OPERATIONS:
Net investment income....................... $ 172,631 $ 179,659 $ 182,836
Realized gain on securities
sold or redeemed.......................... 24,398 9,772
Unrealized appreciation of investments...... 76,283 104,981 43,683
_________________________________________
Net increase in net assets resulting
from operations........................... 273,312 294,412 226,519
_________________________________________
DISTRIBUTIONS TO HOLDERS (Note 2):
Income...................................... (172,645) (179,633) (183,397)
Principal................................... (5,930) (3,916)
_________________________________________
Total distributions......................... (178,575) (183,549) (183,397)
_________________________________________
CAPITAL SHARE TRANSACTIONS - Redemptions of
140 and 81 units, respectively.............. (148,557) (82,010)
_________________________________________
NET INCREASE (DECREASE) IN NET ASSETS......... (53,820) 28,853 43,122
NET ASSETS AT BEGINNING OF YEAR............... 3,335,987 3,307,134 3,264,012
_________________________________________
NET ASSETS AT END OF YEAR..................... $3,282,167 $3,335,987 $3,307,134
=========================================
PER UNIT:
Income distributions during year............ $56.23 $56.38 $56.43
=========================================
Principal distributions during year......... $1.93 $1.22
=========================================
Net asset value at end of year.............. $1,083.58 $1,052.69 $1,017.58
=========================================
TRUST UNITS OUTSTANDING AT END OF YEAR........ 3,029 3,169 3,250
=========================================
</TABLE>
See Notes to Financial Statements.
D - 4
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (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
conformity with generally accepted accounting principles.
(a) Securities are stated at value as determined by the Evaluator
based on bid side evaluations for the securities. See "How to
Sell Units - Trustee's Redemption of Units" in this Prospectus,
Part B.
(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 distributed as explained
in "Income, Distributions and Reinvestment - Distributions" in this
Prospectus, Part B.
3. NET CAPITAL
<TABLE>
<CAPTION>
<S> <C>
Cost of 3,029 units at Date of Deposit.............. $2,729,128
Less sales charge................................... 122,795
______________
Net amount applicable to Holders.................... 2,606,333
Redemptions of units - net cost of 221 units
redeemed less redemption amounts.................. (37,768)
Realized gain on securities sold or redeemed........ 34,170
Principal distributions............................. (9,846)
Unrealized appreciation of investments.............. 649,747
______________
Net capital applicable to Holders................... $3,242,636
==============
</TABLE>
4. INCOME TAXES
As of October 31, 1998, unrealized appreciation of investments, based
on cost for Federal income tax purposes, aggregated $649,747, all of
which related to appreciated securities. The cost of investment
securities for Federal income tax purposes was $2,590,621 at
October 31, 1998.
D - 5
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75
DEFINED ASSET FUNDS
PORTFOLIO OF THE CALIFORNIA TRUST (INSURED)
AS OF OCTOBER 31, 1998
<TABLE>
<CAPTION>
Rating Optional
Portfolio No. and Title of of Face Redemption
Securities(4) Issues(1) Amount Coupon Maturities(3) Provisions(3) Cost Value(2)
_____________ _________ ______ ______ _____________ _____________ ____ ________
<S> <C> <C> <C> <C> <C> <C> <C>
1 California Housing Finance Agency, AAA $ 455,000 5.700% 2016 02/01/04 $ 384,948 $ 468,281
Hsg. Revenue Bonds, Ser. 1994 B @ 102.000
(MBIA Ins.)
2 California Statewide Comm. Dev. AAA 500,000 6.000 2024 08/15/04 432,185 550,675
Auth., Cert. of Part. (Sharp @ 102.000
Healthcare Oblig. Group) (MBIA
Ins.)
3 California Statewide Comm. Dev. AAA 160,000 5.500 2023 08/15/03 128,775 167,642
Auth., Cert. of Part. (Sutter Hlth. @ 102.000
Oblig. Grp). (MBIA Ins.)
4 Anaheim Pub. Fin. Auth., California AAA 500,000 5.750 2022 04/01/03 418,475 536,160
Revenue Bonds (City of Anaheim @ 102.000
Electric Utility) San Juan Unit 4
Proj.), Second Ser. 1993 (Financial
Guaranty Ins.)
5 Chino Basin, California, Regional AAA 500,000 6.000 2016 08/01/04 444,545 554,495
Fin. Auth., Revenue Bonds (Chino @ 102.000
Basin Municiple Water District
Sewer System Project), Ser. 1994
(AMBAC Ins.)
6 Ontario Redev. Fin. Auth., San AAA 550,000 5.500 2018 None 449,691 562,221
Bernardino Cnty., CA (Ontario Redev
Proj. No. 1), 1993 Rev. Bonds (MBIA
Ins.)
7 Cnty. of Sacramento, CA, 1994 Pub. AAA 355,000 6.400 2019 10/01/04 332,002 400,894
Fac. Proj. (Coroner/Crime Lab and @ 102.000
Data Ctr.), Cert. of Part. (AMBAC
Ins.)
______________ ______________ _____________
TOTAL $3,020,000 $2,590,621 $3,240,368
============== ============== =============
</TABLE>
See Notes to Portfolios on Pages D - 35 and D - 36.
D - 6
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (FLORIDA TRUST),
DEFINED ASSET FUNDS
STATEMENT OF CONDITION
AS OF OCTOBER 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C>
TRUST PROPERTY:
Investment in marketable securities - at value
(cost $1,946,139)(Note 1)...................... $2,331,001
Accrued interest receivable...................... 30,818
Cash............................................. 5,335
_____________
Total trust property................. 2,367,154
LESS LIABILITY - Accrued expenses.................. 2,351
_____________
NET ASSETS, REPRESENTED BY:
2,562 units of fractional undivided
interest outstanding (Note 3).................. $2,332,074
Undistributed net investment income.............. 32,729
_____________
$2,364,803
=============
UNIT VALUE ($2,364,803/2,562 units)................ $923.03
=============
</TABLE>
See Notes to Financial Statements.
D - 7
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (FLORIDA TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
.......Years Ended October 31,..........
1998 1997 1996
_________________________________________
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income........................... $158,026 $169,858 $181,663
Trustee's fees and expenses............... (4,374) (5,164) (5,574)
Sponsors' fees............................ (1,197) (1,254) (1,706)
_________________________________________
Net investment income..................... 152,455 163,440 174,383
_________________________________________
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain on securities sold
or redeemed............................. 94,357 33,363 57,504
Unrealized appreciation (depreciation)
of investments.......................... (34,690) 25,063 (9,077)
_________________________________________
Net realized and unrealized gain on
investments............................. 59,667 58,426 48,427
_________________________________________
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS........................... $212,122 $221,866 $222,810
=========================================
</TABLE>
See Notes to Financial Statements.
D - 8
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (FLORIDA TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
.......Years Ended October 31,..........
1998 1997 1996
_________________________________________
<S> <C> <C> <C>
OPERATIONS:
Net investment income....................... $ 152,455 $ 163,440 $ 174,383
Realized gain on securities sold
or redeemed............................... 94,357 33,363 57,504
Unrealized appreciation (depreciation)
of investments............................ (34,690) 25,063 (9,077)
_________________________________________
Net increase in net assets resulting
from operations........................... 212,122 221,866 222,810
_________________________________________
DISTRIBUTIONS TO HOLDERS (Note 2):
Income...................................... (153,809) (163,587) (175,079)
Principal................................... (455,878) (8,286) (6,216)
_________________________________________
Total distributions......................... (609,687) (171,873) (181,295)
_________________________________________
CAPITAL SHARE TRANSACTIONS - Redemptions of
115, 200 and 297 units, respectively........ (118,483) (208,992) (321,523)
_________________________________________
NET DECREASE IN NET ASSETS.................... (516,048) (158,999) (280,008)
NET ASSETS AT BEGINNING OF YEAR............... 2,880,851 3,039,850 3,319,858
_________________________________________
NET ASSETS AT END OF YEAR..................... $2,364,803 $2,880,851 $3,039,850
=========================================
PER UNIT:
Income distributions during year............ $57.89 $59.26 $59.37
=========================================
Principal distributions during year......... $175.05 $2.88 $1.97
=========================================
Net asset value at end of year.............. $923.03 $1,076.15 $1,056.60
=========================================
TRUST UNITS OUTSTANDING AT END OF YEAR........ 2,562 2,677 2,877
=========================================
</TABLE>
See Notes to Financial Statements.
D - 9
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (FLORIDA 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
conformity with generally accepted accounting principles.
(a) Securities are stated at value as determined by the Evaluator
based on bid side evaluations for the securities. See "How to
Sell Units - Trustee's Redemption of Units" in this Prospectus,
Part B.
(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 distributed as explained
in "Income, Distributions and Reinvestment - Distributions" in this
Prospectus, Part B.
3. NET CAPITAL
<TABLE>
<CAPTION>
<S> <C>
Cost of 2,562 units at Date of Deposit.............. $2,457,096
Less sales charge................................... 110,576
______________
Net amount applicable to Holders.................... 2,346,520
Redemptions of units - net cost of 938 units
redeemed less redemption amounts.................. (119,504)
Realized gain on securities sold or redeemed........ 226,298
Principal distributions............................. (506,102)
Unrealized appreciation of investments.............. 384,862
______________
Net capital applicable to Holders................... $2,332,074
==============
</TABLE>
4. INCOME TAXES
As of October 31, 1998, unrealized appreciation of investments, based
on cost for Federal income tax purposes, aggregated $384,862, all of
which related to appreciated securities. The cost of investment
securities for Federal income tax purposes was $1,946,139 at
October 31, 1998.
D - 10
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75
DEFINED ASSET FUNDS
PORTFOLIO OF THE FLORIDA TRUST (INSURED)
AS OF OCTOBER 31, 1998
<TABLE>
<CAPTION>
Rating Optional
Portfolio No. and Title of of Face Redemption
Securities (4) Issues(1) Amount Coupon Maturities(3) Provisions(3) Cost Value(2)
______________ _________ ______ ______ _____________ _____________ ____ ________
<S> <C> <C> <C> <C> <C> <C> <C>
1 The Sch. Bd. of Bay Cnty., FL, AAA $ 460,000 6.750% 2014(5) 07/01/04 $ 452,589 $ 534,235
Cert. of Part. (Bay Cnty. Educ. @ 102.000
Fac. Fin. Corp.), Ser. 1994 (AMBAC
Ins.)
2 Citrus County, Florida Pollution AAA 120,000 6.350 2022 08/01/02 111,928 131,575
Control Refunding Revenue Bonds @ 102.000
(Florida Power Corp. - Crystal
River Power Plant Project), Ser.
1992 B (MBIA Ins.)
3 City of Jacksonville, Florida, AAA 275,000 6.000 2025(5) 10/01/04 243,519 307,906
Capital Improvement Revenue Bonds @ 101.000
(Gator Bowl Project) Ser. 1994
(AMBAC Ins.)
4 Orange Cnty., FL, Tourist Dev. Tax AAA 180,000 6.000 2024 10/01/04 159,597 199,633
Rfdg. Rev. Bonds Ser. 1994 B (MBIA @ 102.000
Ins)
5 The School Board of Seminole AAA 45,000 6.500 2021(5) 07/01/04 41,786 51,332
County, Florida, Certificates of @ 101.000
Participation, (Seminole Sch. Bd.
Leasing Corp.), Ser. 1994 B (MBIA
Ins.)
6 City of Tallahassee, Florida, AAA 500,000 6.000 2015 12/01/02 445,340 536,220
Health Facilities Revenue Bonds @ 102.000
(Tallahassee Memorial Regional
Medical Center Inc. Proj.), Ser.
1992 A (MBIA Ins.)
</TABLE>
D - 11
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75
DEFINED ASSET FUNDS
PORTFOLIO OF THE FLORIDA TRUST (INSURED)
AS OF OCTOBER 31, 1998
<TABLE>
<CAPTION>
Rating Optional
Portfolio No. and Title of of Face Redemption
Securities (4) Issues(1) Amount Coupon Maturities(3) Provisions(3) Cost Value(2)
______________ _________ ______ ______ _____________ _____________ ____ ________
<S> <C> <C> <C> <C> <C>
7 City of West Melbourne, FL, Wtr. AAA $ 500,000 6.750% 2017 10/01/04 $ 491,380 570,100
and Swr. Rev. Rfdg. and Imp. Bonds, @ 102.000
Ser. 1994 (Financial Guaranty Ins.)
______________ ______________ ______________
TOTAL $2,080,000 $1,946,139 $2,331,001
============== ============== ==============
</TABLE>
See Notes to Portfolios on Pages D - 35 and D - 36.
D - 12
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (NEW JERSEY TRUST),
DEFINED ASSET FUNDS
STATEMENT OF CONDITION
AS OF OCTOBER 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C>
TRUST PROPERTY:
Investment in marketable securities - at value
(cost $2,296,063)(Note 1)...................... $2,761,746
Accrued interest receivable...................... 40,661
Cash............................................. 2,375
_____________
Total trust property................. 2,804,782
LESS LIABILITY - Accrued expenses.................. 2,432
_____________
NET ASSETS, REPRESENTED BY:
2,505 units of fractional undivided
interest outstanding (Note 3).................. $2,766,956
Undistributed net investment income.............. 35,394
_____________
$2,802,350
=============
UNIT VALUE ($2,802,350/2,505 units)................ $1,118.70
=============
</TABLE>
See Notes to Financial Statements.
D - 13
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (NEW JERSEY TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
.......Years Ended October 31,..........
1998 1997 1996
_________________________________________
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income........................... $169,120 $190,593 $198,337
Trustee's fees and expenses............... (4,573) (5,444) (6,124)
Sponsors' fees............................ (1,254) (1,349) (1,680)
_________________________________________
Net investment income..................... 163,293 183,800 190,533
_________________________________________
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain on securities sold
or redeemed............................. 81,730 18,618 16,631
Unrealized appreciation (depreciation)
of investments.......................... (23,559) 70,127 14,587
_________________________________________
Net realized and unrealized gain on
investments............................. 58,171 88,745 31,218
_________________________________________
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS........................... $221,464 $272,545 $221,751
=========================================
</TABLE>
See Notes to Financial Statements.
D - 14
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (NEW JERSEY TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
.......Years Ended October 31,..........
1998 1997 1996
_________________________________________
<S> <C> <C> <C>
OPERATIONS:
Net investment income....................... $ 163,293 $ 183,800 $ 190,533
Realized gain on securities sold
or redeemed............................... 81,730 18,618 16,631
Unrealized appreciation (depreciation)
of investments............................ (23,559) 70,127 14,587
_________________________________________
Net increase in net assets resulting
from operations........................... 221,464 272,545 221,751
_________________________________________
DISTRIBUTIONS TO HOLDERS (Note 2):
Income...................................... (163,050) (183,937) (191,430)
Principal................................... (24,694) (8,672) (9,547)
_________________________________________
Total distributions......................... (187,744) (192,609) (200,977)
_________________________________________
CAPITAL SHARE TRANSACTIONS - Redemptions of
409, 118 and 121 units, respectively........ (453,790) (128,582) (129,641)
_________________________________________
NET DECREASE IN NET ASSETS.................... (420,070) (48,646) (108,867)
NET ASSETS AT BEGINNING OF YEAR............... 3,222,420 3,271,066 3,379,933
_________________________________________
NET ASSETS AT END OF YEAR..................... $2,802,350 $3,222,420 $3,271,066
=========================================
PER UNIT:
Income distributions during year............ $61.35 $61.60 $61.74
=========================================
Principal distributions during year......... $9.25 $2.86 $3.06
=========================================
Net asset value at end of year.............. $1,118.70 $1,105.84 $1,078.85
=========================================
TRUST UNITS OUTSTANDING AT END OF YEAR........ 2,505 2,914 3,032
=========================================
</TABLE>
See Notes to Financial Statements.
D - 15
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (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
conformity with generally accepted accounting principles.
(a) Securities are stated at value as determined by the Evaluator
based on bid side evaluations for the securities. See "How to
Sell Units - Trustee's Redemption of Units" in this Prospectus,
Part B.
(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 distributed as explained
in "Income, Distributions and Reinvestment - Distributions" in this
Prospectus, Part B.
3. NET CAPITAL
<TABLE>
<CAPTION>
<S> <C>
Cost of 2,505 units at Date of Deposit.............. $2,438,689
Less sales charge................................... 109,744
______________
Net amount applicable to Holders.................... 2,328,945
Redemptions of units - net cost of 745 units
redeemed less redemption amounts.................. (111,859)
Realized gain on securities sold or redeemed........ 127,100
Principal distributions............................. (42,913)
Unrealized appreciation of investments.............. 465,683
______________
Net capital applicable to Holders................... $2,766,956
==============
</TABLE>
4. INCOME TAXES
As of October 31, 1998, unrealized appreciation of investments, based
on cost for Federal income tax purposes, aggregated $465,683, all of
which related to appreciated securities. The cost of investment
securities for Federal income tax purposes was $2,296,063 at
October 31, 1998.
D - 16
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75
DEFINED ASSET FUNDS
PORTFOLIO OF THE NEW JERSEY TRUST (INSURED)
AS OF OCTOBER 31, 1998
<TABLE>
<CAPTION>
Rating Optional
Portfolio No. and Title of of Face Redemption
Securities (4) Issues(1) Amount Coupon Maturities(3) Provisions(3) Cost Value(2)
______________ _________ ______ ______ _____________ _____________ ____ ________
<S> <C> <C> <C> <C> <C> <C> <C>
1 New Jersey Eco. Dev. Auth. Gas AAA $ 375,000 6.350% 2022 10/01/04 $ 345,255 $ 421,665
Facs. Rfdg. Rev. Bonds, (Nui Corp. @ 102.000
Proj.), 1994 Ser. A (AMBAC Ins.)
2 New Jersey Health Care Facilities AAA 205,000 6.250 2024 07/01/04 184,703 228,130
Finance Authority, Revenue Bonds @ 102.000
(Monmouth Medical Center Issue),
1994 Ser. C (FSAM Ins.)
3 New Jersey Hsg. and Mtge. Fin. AAA 500,000 6.700 2016 10/01/04 480,765 545,680
Agy., Home Buyer Rev. Bonds, Ser. @ 102.000
1994 L (MBIA Ins.)
4 The Essex County Improvement AAA 420,000 7.000 2024(5) 12/01/04 421,672 496,306
Authority, New Jersey General @ 102.000
Obligation Lease Revenue Bonds
(County Jail and Youth House
Project), Ser. 1994 (AMBAC Ins.)
5 Gloucester County Utility AAA 50,000 6.250 2024(5) 01/01/04 45,359 56,269
Authority, New Jersey, Sewer @ 102.000
Revenue Bonds, Ser. 1994 (MBIA
Ins.)
6 The County of Middlesex, New AAA 410,000 6.125 2019(5) 02/15/04 370,558 456,551
Jersey, Certificate of @ 101.000
Participation (PBCF New Jersey,
Inc.) (MBIA Ins.)
</TABLE>
D - 17
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75
DEFINED ASSET FUNDS
PORTFOLIO OF THE NEW JERSEY TRUST (INSURED)
AS OF OCTOBER 31, 1998
<TABLE>
<CAPTION>
Rating Optional
Portfolio No. and Title of of Face Redemption
Securities (4) Issues(1) Amount Coupon Maturities(3) Provisions(3) Cost Value(2)
______________ _________ ______ ______ _____________ _____________ ____ ________
<S> <C> <C> <C> <C> <C>
7 The Pollution Control Finance AAA $ 500,000 6.250% 2031 06/01/04 $ 447,751 557,145
Authority of Salem, New Jersey, @ 102.000
Pollution Control Revenue Refunding
Bonds (Public Service Electric and
Gas Company Project) (MBIA Ins.)
______________ ______________ _____________
TOTAL $2,460,000 $2,296,063 $2,761,746
============== ============== =============
</TABLE>
See Notes to Portfolios on Pages D - 35 and D - 36.
D - 18
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (NEW YORK TRUST),
DEFINED ASSET FUNDS
STATEMENT OF CONDITION
AS OF OCTOBER 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C>
TRUST PROPERTY:
Investment in marketable securities - at value
(cost $7,624,391)(Note 1)...................... $9,536,224
Accrued interest receivable...................... 140,879
Cash............................................. 13
_____________
Total trust property................. 9,677,116
LESS LIABILITY - Accrued expenses.................. 4,949
_____________
NET ASSETS, REPRESENTED BY:
8,797 units of fractional undivided
interest outstanding (Note 3).................. $9,553,970
Undistributed net investment income.............. 118,197
_____________
$9,672,167
=============
UNIT VALUE ($9,672,167/8,797 units)................ $1,099.48
=============
</TABLE>
See Notes to Financial Statements.
D - 19
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (NEW YORK TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
.......Years Ended October 31,..........
1998 1997 1996
_________________________________________
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income........................... $537,730 $559,373 $568,121
Trustee's fees and expenses............... (9,343) (10,172) (10,893)
Sponsors' fees............................ (4,117) (4,228) (4,906)
_________________________________________
Net investment income..................... 524,270 544,973 552,322
_________________________________________
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain on securities sold
or redeemed............................. 80,188 44,957 50,244
Unrealized appreciation (depreciation)
of investments.......................... 204,081 324,333 (51,449)
_________________________________________
Net realized and unrealized gain (loss)
on investments.......................... 284,269 369,290 (1,205)
_________________________________________
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS........................... $808,539 $914,263 $551,117
=========================================
</TABLE>
See Notes to Financial Statements.
D - 20
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (NEW YORK TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
.......Years Ended October 31,..........
1998 1997 1996
_________________________________________
<S> <C> <C> <C>
OPERATIONS:
Net investment income....................... $ 524,270 $ 544,973 $ 552,322
Realized gain on securities sold
or redeemed............................... 80,188 44,957 50,244
Unrealized appreciation (depreciation)
of investments............................ 204,081 324,333 (51,449)
_________________________________________
Net increase in net assets resulting
from operations........................... 808,539 914,263 551,117
_________________________________________
DISTRIBUTIONS TO HOLDERS (Note 2):
Income...................................... (524,443) (547,914) (553,122)
Principal................................... (9,305) (5,599) (10,358)
_________________________________________
Total distributions......................... (533,748) (553,513) (563,480)
_________________________________________
CAPITAL SHARE TRANSACTIONS - Redemptions of
416, 277 and 273 units, respectively........ (450,976) (291,303) (288,060)
_________________________________________
NET INCREASE (DECREASE) IN NET ASSETS......... (176,185) 69,447 (300,423)
NET ASSETS AT BEGINNING OF YEAR............... 9,848,352 9,778,905 10,079,328
_________________________________________
NET ASSETS AT END OF YEAR..................... $9,672,167 $9,848,352 $ 9,778,905
=========================================
PER UNIT:
Income distributions during year............ $57.98 $58.35 $58.05
=========================================
Principal distributions during year......... $1.01 $0.59 $1.07
=========================================
Net asset value at end of year.............. $1,099.48 $1,068.96 $1,030.44
=========================================
TRUST UNITS OUTSTANDING AT END OF YEAR........ 8,797 9,213 9,490
=========================================
</TABLE>
See Notes to Financial Statements.
D - 21
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (NEW YORK 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
conformity with generally accepted accounting principles.
(a) Securities are stated at value as determined by the Evaluator
based on bid side evaluations for the securities. See "How to
Sell Units - Trustee's Redemption of Units" in this Prospectus,
Part B. Gains or losses on sales or redemptions of securities are
computed using the first-in, first-out method.
(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 distributed as explained
in "Income, Distributions and Reinvestment - Distributions" in this
Prospectus, Part B.
3. NET CAPITAL
<TABLE>
<CAPTION>
<S> <C>
Cost of 8,797 units at Date of Deposit.............. $8,034,923
Less sales charge................................... 361,568
______________
Net amount applicable to Holders.................... 7,673,355
Redemptions of units - net cost of 1,203 units
redeemed less redemption amounts.................. (209,573)
Realized gain on securities sold or redeemed........ 203,617
Principal distributions............................. (25,262)
Unrealized appreciation of investments.............. 1,911,833
______________
Net capital applicable to Holders................... $9,553,970
==============
</TABLE>
4. INCOME TAXES
As of October 31, 1998, unrealized appreciation of investments, based
on cost for Federal income tax purposes, aggregated $1,911,833, all of
which related to appreciated securities. The cost of investment
securities for Federal income tax purposes was $7,624,391 at
October 31, 1998.
D - 22
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75
DEFINED ASSET FUNDS
PORTFOLIO OF THE NEW YORK TRUST (INSURED)
AS OF OCTOBER 31, 1998
<TABLE>
<CAPTION>
Rating Optional
Portfolio No. and Title of of Face Redemption
Securities(4) Issues(1) Amount Coupon Maturities(3) Provisions(3) Cost Value(2)
_____________ _________ ______ ______ _____________ _____________ ____ ________
<S> <C> <C> <C> <C> <C> <C> <C>
1 Dormitory Authority of the State AAA $1,500,000 6.300% 2024 07/01/04 $1,365,060 $1,681,050
of New York, City University System @ 102.000
Consolidated Third General
Resolution Revenue Bonds, 1994 Ser.
1 (AMBAC Ins.)
2 Dormitory Auth. of the State of AAA 640,000 5.250 2013 None 519,161 686,554
New York, State Univ. Educl. Facs.
Rev. Bonds, 1993 Ser.B (Financial
Guaranty Ins.)
3 New York State Energy Research and AAA 1,430,000 6.050 2034 04/01/04 1,234,342 1,572,485
Development Authority, Pollution @ 102.000
Control Refunding Revenue (New York
State Electric and Gas Corporation
Project), 1994 Ser. A (MBIA Ins.)
4 Metro Tran. Auth. NY, Transit Facs. AAA 890,000 6.000 2014 07/01/03 787,704 973,384
Rev. Bonds, Ser. M (CAPMAC Ins.) @ 101.500
5 State of New York Mtge. Agy., AAA 960,000 6.450 2014 06/01/04 895,370 1,049,020
Homeowner Mtge. Rev. Bonds (MBIA @ 102.000
Ins.)
6 New York State Thruway Auth., Gen. AAA 1,150,000 5.500 2023(5) 01/01/02 926,134 1,212,008
Rev. Bonds, Ser. A (Financial @ 100.000
Guaranty Ins.)
7 Albany Municipal Water Finance AAA 730,000 5.500 2022 12/01/03 590,853 765,719
Authority, New York, Water and @ 102.000
Sewer System Revenue Bonds, Ser.
1993 A (Financial Quaranty Ins.)
</TABLE>
D - 23
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75
DEFINED ASSET FUNDS
PORTFOLIO OF THE NEW YORK TRUST (INSURED)
AS OF OCTOBER 31, 1998
<TABLE>
<CAPTION>
Rating Optional
Portfolio No. and Title of of Face Redemption
Securities(4) Issues(1) Amount Coupon Maturities(3) Provisions(3) Cost Value(2)
_____________ _________ ______ ______ _____________ _____________ ____ ________
<S> <C> <C> <C> <C> <C>
8 New York City, NY, Muni. Wtr. Fin. AAA $ 770,000 5.500% 2015 06/15/04 $ 634,270 $ 809,771
Auth., Ser F (MBIA Ins.) @ 101.500
9 New York City, NY, Muni. Wtr. Fin. AAA 675,000 6.950 2012(5) 08/15/04 671,497 786,233
Auth., Ser. F (MBIA Ins.) @ 101.500
______________ ______________ ______________
TOTAL $8,745,000 $7,624,391 $9,536,224
============== ============== ==============
</TABLE>
See Notes to Portfolios on Pages D - 35 and D - 36.
D - 24
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (OHIO TRUST),
DEFINED ASSET FUNDS
STATEMENT OF CONDITION
AS OF OCTOBER 31, 1998
<TABLE>
<CAPTION>
<S> <C> <C>
TRUST PROPERTY:
Investment in marketable securities - at value
(cost $2,677,248)(Note 1)...................... $3,176,503
Accrued interest receivable...................... 75,471
_____________
Total trust property................. 3,251,974
LESS LIABILITIES:
Advance from Trustee............................. $ 19,846
Accrued expenses................................. 2,487 22,333
_____________ _____________
NET ASSETS, REPRESENTED BY:
2,821 units of fractional undivided
interest outstanding (Note 3).................. 3,186,901
Undistributed net investment income.............. 42,740
_____________
$3,229,641
=============
UNIT VALUE ($3,229,641/2,821 units)................ $1,144.86
=============
</TABLE>
See Notes to Financial Statements.
D - 25
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (OHIO TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
.......Years Ended October 31,..........
1998 1997 1996
_________________________________________
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income........................... $190,036 $200,385 $210,275
Trustee's fees and expenses............... (4,668) (5,379) (6,021)
Sponsors' fees............................ (1,331) (1,394) (1,715)
_________________________________________
Net investment income..................... 184,037 193,612 202,539
_________________________________________
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain on securities sold
or redeemed............................. 24,231 23,801 9,520
Unrealized appreciation of investments.... 30,883 44,855 26,736
_________________________________________
Net realized and unrealized gain on
investments............................. 55,114 68,656 36,256
_________________________________________
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS........................... $239,151 $262,268 $238,795
=========================================
</TABLE>
See Notes to Financial Statements.
D - 26
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (OHIO TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
.......Years Ended October 31,..........
1998 1997 1996
_________________________________________
<S> <C> <C> <C>
OPERATIONS:
Net investment income....................... $ 184,037 $ 193,612 $ 202,539
Realized gain on securities sold
or redeemed............................... 24,231 23,801 9,520
Unrealized appreciation of investments...... 30,883 44,855 26,736
_________________________________________
Net increase in net assets resulting
from operations........................... 239,151 262,268 238,795
_________________________________________
DISTRIBUTIONS TO HOLDERS (Note 2):
Income...................................... (183,757) (194,003) (203,318)
Principal................................... (7,440) (8,237) (4,911)
_________________________________________
Total distributions......................... (191,197) (202,240) (208,229)
_________________________________________
CAPITAL SHARE TRANSACTIONS - Redemptions of
143, 168 and 78 units, respectively......... (162,436) (186,930) (85,103)
_________________________________________
NET DECREASE IN NET ASSETS.................... (114,482) (126,902) (54,537)
NET ASSETS AT BEGINNING OF YEAR............... 3,344,123 3,471,025 3,525,562
_________________________________________
NET ASSETS AT END OF YEAR..................... $3,229,641 $3,344,123 $3,471,025
=========================================
PER UNIT:
Income distributions during year............ $63.02 $63.22 $63.40
=========================================
Principal distributions during year......... $2.51 $2.63 $1.53
=========================================
Net asset value at end of year.............. $1,144.86 $1,128.25 $1,108.25
=========================================
TRUST UNITS OUTSTANDING AT END OF YEAR........ 2,821 2,964 3,132
=========================================
</TABLE>
See Notes to Financial Statements.
D - 27
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (OHIO 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
conformity with generally accepted accounting principles.
(a) Securities are stated at value as determined by the Evaluator
based on bid side evaluations for the securities. See "How to
Sell Units - Trustee's Redemption of Units" in this Prospectus,
Part B.
(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 distributed as explained
in "Income, Distributions and Reinvestment - Distributions" in this
Prospectus, Part B.
3. NET CAPITAL
<TABLE>
<CAPTION>
<S> <C>
Cost of 2,821 units at Date of Deposit.............. $2,835,882
Less sales charge................................... 127,622
______________
Net amount applicable to Holders.................... 2,708,260
Redemptions of units - net cost of 429 units
redeemed less redemption amounts.................. (61,124)
Realized gain on securities sold or redeemed........ 61,098
Principal distributions............................. (20,588)
Unrealized appreciation of investments.............. 499,255
______________
Net capital applicable to Holders................... $3,186,901
==============
</TABLE>
4. INCOME TAXES
As of October 31, 1998, unrealized appreciation of investments, based
on cost for Federal income tax purposes, aggregated $499,255, all of
which related to appreciated securities. The cost of investment
securities for Federal income tax purposes was $2,677,248 at
October 31, 1998.
D - 28
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75
DEFINED ASSET FUNDS
PORTFOLIO OF THE OHIO TRUST (INSURED)
AS OF OCTOBER 31, 1998
<TABLE>
<CAPTION>
Rating Optional
Portfolio No. and Title of of Face Redemption
Securities(4) Issues(1) Amount Coupon Maturities(3) Provisions(3) Cost Value(2)
_____________ _________ ______ ______ _____________ _____________ ____ ________
<S> <C> <C> <C> <C> <C> <C> <C>
1 State of Ohio, Higher Educl. Fac. AAA $ 500,000 6.600% 2017 12/01/03 $ 485,590 $ 564,975
Mtge. Rev. Bonds (Univ. of Dayton @ 102.000
1992 Proj.) (Financial Guaranty
Ins.)
2 City of Cleveland, Ohio, Public AAA 420,000 7.000 2024(5) 11/15/04 412,260 496,125
Power System First Mortgage Revenue @ 102.000
Bonds, Ser. 1994 A (MBIA Ins.)
3 City of Cleveland, OH, Var. Pur. AAA 405,000 6.700 2018(5) 11/15/04 397,892 472,161
G.O. Bonds, Ser. 1994 (MBIA Ins.) @ 102.000
4 City of Hamilton, Ohio, Electric AAA 155,000 6.000 2023 10/15/02 137,614 168,893
System Mortgage Revenue Refunding @ 102.000
Bonds, 1992 Ser. A (Financial
Guaranty Ins.)
5 Lakewood City School Dist., OH, AAA 455,000 6.950 2015 12/01/04 458,667 528,628
School Imp. Bonds, Ser. 1994 @ 102.000
(General Oblig. Unlimited Tax)
(MBIA Ins.)
6 City of Mason, Ohio, Sewer System AAA 460,000 6.000 2019 12/01/04 410,950 507,615
Mortgage Revenue Bonds, Ser. 1994 @ 101.000
(Financial Guaranty Ins.)
7 Wooster City School Dist., Wayne AAA 390,000 6.500 2017(5) 12/01/02 374,275 438,106
Cnty., OH, G.O. Bonds (Unlimited @ 102.000
Tax) (AMBAC Ins.)
______________ ______________ ______________
TOTAL $2,785,000 $2,677,248 $3,176,503
============== ============== ==============
</TABLE>
See Notes to Portfolios on Pages D - 35 and D - 36.
D - 29
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (PENNSYLVANIA TRUST),
DEFINED ASSET FUNDS
STATEMENT OF CONDITION
AS OF OCTOBER 31, 1998
<TABLE>
<S> <C> <C>
TRUST PROPERTY:
Investment in marketable securities - at value
(cost $2,347,688)(Note 1)...................... $2,860,004
Accrued interest receivable...................... 51,003
_____________
Total trust property................. 2,911,007
LESS LIABILITIES:
Advance from Trustee............................. $ 11,567
Accrued expenses................................. 2,457 14,024
_____________ _____________
NET ASSETS, REPRESENTED BY:
2,636 units of fractional undivided
interest outstanding (Note 3).................. 2,860,010
Undistributed net investment income.............. 36,973
_____________
$2,896,983
=============
UNIT VALUE ($2,896,983/2,636 units)................ $1,099.01
=============
</TABLE>
See Notes to Financial Statements.
D - 30
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (PENNSYLVANIA TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
.......Years Ended October 31,..........
1998 1997 1996
_________________________________________
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income........................... $175,787 $190,422 $197,354
Trustee's fees and expenses............... (4,594) (5,361) (6,021)
Sponsors' fees............................ (1,323) (1,387) (1,713)
_________________________________________
Net investment income..................... 169,870 183,674 189,620
_________________________________________
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Realized gain on securities sold
or redeemed............................. 69,543 14,986 10,603
Unrealized appreciation (depreciation)
of investments.......................... (3,960) 74,451 19,455
_________________________________________
Net realized and unrealized gain on
investments............................. 65,583 89,437 30,058
_________________________________________
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS........................... $235,453 $273,111 $219,678
=========================================
</TABLE>
See Notes to Financial Statements.
D - 31
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (PENNSYLVANIA TRUST),
DEFINED ASSET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
.......Years Ended October 31,..........
1998 1997 1996
_________________________________________
<S> <C> <C> <C>
OPERATIONS:
Net investment income....................... $ 169,870 $ 183,674 $ 189,620
Realized gain on securities sold
or redeemed............................... 69,543 14,986 10,603
Unrealized appreciation (depreciation)
of investments............................ (3,960) 74,451 19,455
_________________________________________
Net increase in net assets resulting
from operations........................... 235,453 273,111 219,678
_________________________________________
DISTRIBUTIONS TO HOLDERS (Note 2):
Income...................................... (169,810) (183,697) (190,244)
Principal................................... (20,083) (7,182) (4,295)
_________________________________________
Total distributions......................... (189,893) (190,879) (194,539)
_________________________________________
CAPITAL SHARE TRANSACTIONS - Redemptions of
365, 108 and 96 units, respectively......... (399,643) (115,364) (99,011)
_________________________________________
NET DECREASE IN NET ASSETS.................... (354,083) (33,132) (73,872)
NET ASSETS AT BEGINNING OF YEAR............... 3,251,066 3,284,198 3,358,070
_________________________________________
NET ASSETS AT END OF YEAR..................... $2,896,983 $3,251,066 $3,284,198
=========================================
PER UNIT:
Income distributions during year............ $59.94 $60.12 $60.26
=========================================
Principal distributions during year......... $7.35 $2.31 $1.34
=========================================
Net asset value at end of year.............. $1,099.01 $1,083.33 $1,056.35
=========================================
TRUST UNITS OUTSTANDING AT END OF YEAR........ 2,636 3,001 3,109
=========================================
</TABLE>
See Notes to Financial Statements.
D - 32
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (PENNSYLVANIA 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
conformity with generally accepted accounting principles.
(a) Securities are stated at value as determined by the Evaluator
based on bid side evaluations for the securities. See "How to
Sell Units - Trustee's Redemption of Units" in this Prospectus,
Part B.
(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 distributed as explained
in "Income, Distributions and Reinvestment - Distributions" in this
Prospectus, Part B.
3. NET CAPITAL
Cost of 2,636 units at Date of Deposit.............. $2,489,536
Less sales charge................................... 112,030
______________
Net amount applicable to Holders.................... 2,377,506
Redemptions of units - net cost of 614 units
redeemed less redemption amounts.................. (97,716)
Realized gain on securities sold or redeemed........ 99,464
Principal distributions............................. (31,560)
Unrealized appreciation of investments.............. 512,316
______________
Net capital applicable to Holders................... $2,860,010
==============
4. INCOME TAXES
As of October 31, 1998, unrealized appreciation of investments,
based on cost for Federal income tax purposes, aggregated $512,316 all
of which related to appreciated securities. The cost of investment
securities for Federal income tax purposes was $2,347,688 at
October 31, 1998.
D - 33
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75
DEFINED ASSET FUNDS
PORTFOLIO OF THE PENNSYLVANIA TRUST (INSURED)
AS OF OCTOBER 31, 1998
<TABLE>
<CAPTION>
Rating Optional
Portfolio No. and Title of of Face Redemption
Securities(4) Issues(1) Amount Coupon Maturities(3) Provisions(3) Cost Value(2)
_____________ _________ ______ ______ _____________ _____________ ____ ________
<S> <C> <C> <C> <C> <C> <C> <C>
1 The Hospital Authority of the AAA $ 500,000 6.250% 2022(5) 07/01/02 $ 448,795 $ 551,900
County of Beaver, Hospital Revenue @ 102.000
Bonds, Pennsylvania, Ser. 1992 A
(AMBAC Ins.)
2 Exeter Turnpike Authority, Berks AAA 155,000 6.200 2022(5) 07/15/02 138,183 168,353
County, Pennsylvania, Guaranteed @ 102.000
Sewer Revenue Bonds, Ser. 1993
(MBIA Ins.)
3 Erie County Hospital Authority AAA 500,000 6.375 2022 07/01/02 456,316 547,865
(Commonwealth of Pennsylvania) @ 102.000
Hospital Revenue Bonds, Ser. A,
1992 (MBIA Ins.)
4 North Penn Water Authority AAA 315,000 6.200 2022 11/01/02 284,243 342,966
(Montgomery County, Pennsylvania) @ 101.000
Water Revenue Bonds, Ser. 1992
(Financial Guaranty Ins.)
5 Northampton Cnty., PA, Higher AAA 160,000 5.750 2018 11/15/02 136,090 168,461
Education Auth., Univ. Rev. Bonds @ 102.000
(Lehigh Univ.) 1993 Ser A (MBIA
Ins.)
6 York Cnty. Indl. Dev. Auth., PA, AAA 465,000 6.450 2019 10/01/04 432,436 526,584
Poll. Ctl. Rev. Rfdg., Bonds, Ser. @ 102.000
1994 A ( MBIA Ins.)
7 City of Philadelphia, PA, Gas AAA 500,000 6.375 2026 07/01/03 451,625 553,875
Works Rev. Bonds, Fourteenth Ser. @ 102.000
(CAPMAC Ins.)
______________ ______________ _____________
TOTAL $2,595,000 $2,347,688 $2,860,004
============== ============== =============
</TABLE>
See Notes to Portfolios on Pages D - 35 and D - 36.
D - 34
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (CALIFORNIA, FLORIDA, NEW JERSEY, NEW YORK, OHIO
AND PENNSYLVANIA TRUSTS)
DEFINED ASSET FUNDS
NOTES TO PORTFOLIOS
AS OF OCTOBER 31, 1998
(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. A description of the rating symbols and
their meanings appears under "Descriptions of Ratings" in this
Prospectus, Part B.
(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. The tax effect on Holders of redemptions and
related distributions is described under "Taxes" in this
Prospectus, Part B.
(4) All Securities are insured either on an individual basis or by
portfolio insurance, by a municipal bond insurance company
which has been assigned "AAA" claims paying ability by
Standard & Poor's. Accordingly, Standard & Poor's has assigned
"AAA" ratings to the Securities. Securities covered by
portfolio insurance are rated "AAA" only as long as they
remain in this Trust. See "Risk Factors - Bonds Backed by
Letters of Credit or Insurance" in this Prospectus, Part B.
D - 35
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 75 (CALIFORNIA, FLORIDA, NEW JERSEY, NEW YORK, OHIO
AND PENNSYLVANIA TRUSTS)
DEFINED ASSET FUNDS
NOTES TO PORTFOLIOS
AS OF OCTOBER 31, 1998
(5) Bonds with aggregate face amounts of $780,000, $880,000,
$1,825,000, $1,215,000, and $655,000 for the Florida, New Jersey,
New York, Ohio and Pennsylvania Trusts, respectively, have been
pre-refunded and are expected to be called for redemption on the
optional redemption provision dates shown.
D - 36
<PAGE>
Defined
Asset FundsSM
HAVE QUESTIONS ? MUNICIPAL INVESTMENT TRUST FUND
Request the most MULTISTATE SERIES--75
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 Bank of New York investment company filed with the
1-800-221-7771 Securities and Exchange Commission in
Washington, D.C. under the:
o Securities Act of 1933 (file no.
33-55781) and
o 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.
15012--1/99
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND
MULTISTATE SERIES
DEFINED ASSET FUNDS
CONTENTS OF REGISTRATION STATEMENT
This Post-Effective Amendment to the Registration Statement on Form S-6
comprises the following papers and documents:
The facing sheet of Form S-6.
The cross-reference sheet (incorporated by reference to the Cross-Reference
Sheet to the Registration Statement of Defined Asset Funds Municipal Insured
Series, 1933 Act File No. 33-54565).
The Prospectus.
The Signatures.
The following exhibits:
1.1.1--Form of Standard Terms and Conditions of Trust Effective as of
October 21, 1993 (incorporated by reference to Exhibit 1.1.1 to the
Registration Statement of Municipal Investment Trust Fund,
Multistate Series--48, 1933 Act File No. 33-50247).
4.1 --Consent of the Evaluator.
5.1 --Consent of independent accountants.
9.1 --Information Supplement (incorporated by reference to Post-Effective
Amendment No. 4 to Exhibit 9.1 to the Registration Statement of
Municipal Investment Trust Fund, Insured Series--207, 1933 Act File
No. 33-54037).
R-1
<PAGE>
MUNICIPAL INVESTMENT TRUST FUND
MULTISTATE SERIES--75
DEFINED ASSET FUNDS
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT,
MUNICIPAL INVESTMENT TRUST FUND, MULTISTATE SERIES--75, DEFINED ASSET FUNDS,
CERTIFIES THAT IT MEETS ALL OF THE REQUIREMENTS FOR EFFECTIVENESS OF THIS
REGISTRATION STATEMENT PURSUANT TO RULE 485(B) UNDER THE SECURITIES ACT OF 1933
AND HAS DULY CAUSED THIS REGISTRATION STATEMENT OR AMENDMENT TO THE REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED THEREUNTO DULY
AUTHORIZED IN THE CITY OF NEW YORK AND STATE OF NEW YORK ON THE 14TH DAY OF
JANUARY, 1999.
SIGNATURES APPEAR ON PAGES R-3, R-4, R-5, R-6 AND R-7.
A majority of the members of the Board of Directors of Merrill Lynch,
Pierce, Fenner & Smith Incorporated has signed this Registration Statement or
Amendment to the Registration Statement pursuant to Powers of Attorney
authorizing the person signing this Registration Statement or Amendment to the
Registration Statement to do so on behalf of such members.
A majority of the members of the Board of Directors of Salomon Smith Barney
Inc. has signed this Registration Statement or Amendment to the Registration
Statement pursuant to Powers of Attorney authorizing the person signing this
Registration Statement or Amendment to the Registration Statement to do so on
behalf of such members.
A majority of the members of the Board of Directors of Prudential
Securities Incorporated has signed this Registration Statement or Amendment to
the Registration Statement pursuant to Powers of Attorney authorizing the person
signing this Registration Statement or Amendment to the Registration Statement
to do so on behalf of such members.
A majority of the members of the Executive Committee of the Board of
Directors of PaineWebber Incorporated has signed this Registration Statement or
Amendment to the Registration Statement pursuant to Powers of Attorney
authorizing the person signing this Registration Statement or Amendment to the
Registration Statement to do so on behalf of such members.
A majority of the members of the Board of Directors of Dean Witter Reynolds
Inc. has signed this Registration Statement or Amendment to the Registration
Statement pursuant to Powers of Attorney authorizing the person signing this
Registration Statement or Amendment to the Registration Statement to do so on
behalf of such members.
R-2
<PAGE>
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
DEPOSITOR
By the following persons, who constitute Powers of Attorney have been filed
a majority of under
the Board of Directors of Merrill Form SE and the following 1933 Act
Lynch, Pierce, File
Fenner & Smith Incorporated: Numbers: 33-43466 and 33-51607
HERBERT M. ALLISON, JR.
JOHN L. STEFFENS
By ERNEST V. FABIO
(As authorized signatory for Merrill Lynch, Pierce,
Fenner & Smith Incorporated and
Attorney-in-fact for the persons listed above)
R-3
<PAGE>
SALOMON SMITH BARNEY INC.
DEPOSITOR
By the following persons, who constitute a majority of Powers of Attorney
the Board of Directors of Salomon Smith Barney Inc.: have been filed
under the 1933 Act
File Numbers:
333-63417 and
333-63033
MICHAEL A. CARPENTER
DERYCK C. MAUGHAN
By GINA LEMON
(As authorized signatory for
Salomon Smith Barney Inc. and
Attorney-in-fact for the persons listed above)
R-4
<PAGE>
PRUDENTIAL SECURITIES INCORPORATED
DEPOSITOR
By the following persons, who constitute a majority of Powers of Attorney
the Board of Directors of Prudential Securities have been filed
Incorporated: under Form SE and
the following 1933
Act File Numbers:
33-41631 and
333-15919
ROBERT C. GOLDEN
ALAN D. HOGAN
A. LAURENCE NORTON, JR.
LELAND B. PATON
VINCENT T. PICA II
MARTIN PFINSGRAFF
HARDWICK SIMMONS
LEE B. SPENCER, JR.
BRIAN M. STORMS
By RICHARD R. HOFFMANN
(As authorized signatory for Prudential Securities
Incorporated and Attorney-in-fact for the persons
listed above)
R-5
<PAGE>
PAINEWEBBER INCORPORATED
DEPOSITOR
By the following persons, who constitute Powers of Attorney have been filed
the Board of Directors of PaineWebber under
Incorporated: the following 1933 Act File
Number: 33-55073
MARGO N. ALEXANDER
TERRY L. ATKINSON
BRIAN M. BAREFOOT
STEVEN P. BAUM
MICHAEL CULP
REGINA A. DOLAN
JOSEPH J. GRANO, JR.
EDWARD M. KERSCHNER
JAMES P. MacGILVRAY
DONALD B. MARRON
ROBERT H. SILVER
MARK B. SUTTON
By
ROBERT E. HOLLEY
(As authorized signatory for
PaineWebber Incorporated
and Attorney-in-fact for the persons listed above)
R-6
<PAGE>
DEAN WITTER REYNOLDS INC.
DEPOSITOR
By the following persons, who constitute Powers of Attorney have been filed
a majority of under Form SE and the following 1933
the Board of Directors of Dean Witter Act File Numbers: 33-17085 and
Reynolds Inc.: 333-13039
RICHARD M. DeMARTINI
ROBERT J. DWYER
CHRISTINE A. EDWARDS
JAMES F. HIGGINS
MITCHELL M. MERIN
STEPHEN R. MILLER
RICHARD F. POWERS III
PHILIP J. PURCELL
THOMAS C. SCHNEIDER
WILLIAM B. SMITH
By
MICHAEL D. BROWNE
(As authorized signatory for
Dean Witter Reynolds Inc.
and Attorney-in-fact for the persons listed above)
R-7
<PAGE>
EXHIBIT 4.1
STANDARD & POOR'S
A DIVISION OF THE McGRAW-HILL COMPANIES
J. J. KENNY
65 BROADWAY
NEW YORK, N.Y. 10006-2551
TELEPHONE (212) 770-4422
FAX 212/797-8681
January 14, 1999
Frank A. Ciccotto, Jr.
Vice President
Tax-Exempt Evaluations
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Defined Asset Funds
P.O. Box 9051
Princeton, New Jersey 08543-9051
The Bank of New York
101 Barclay Street
New York, New York 10286
RE: MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES--75, DEFINED ASSET FUNDS
Gentlemen:
We have examined the post-effective Amendment to the Registration Statement
File No. 33-55781 for the above-captioned trust. We hereby acknowledge that
Kenny S&P Evaluation Services, a division of J. J. Kenny Co., Inc. is currently
acting as the evaluator for the trust. We hereby consent to the use in the
Amendment of the reference to Kenny S&P Evaluation Services, a division of J. J.
Kenny Co., Inc. as evaluator.
In addition, we hereby confirm that the ratings indicated in the
above-referenced Amendment to the Registration Statement for the respective
bonds comprising the trust portfolio are the ratings currently indicated in our
KENNYBASE database.
You are hereby authorized to file copies of this letter with the Securities
and Exchange Commission.
Sincerely,
FRANK A. CICCOTTO
Vice President
<PAGE>
Exhibit 5.1
CONSENT OF INDEPENDENT ACCOUNTANTS
The Sponsors and Trustee of
Municipal Investment Trust Fund--Multistate Series--75, Defined Asset Funds
(California, Florida, New Jersey, New York, Ohio and Pennsylvania Insured
Trusts)
We consent to the use in this Post-Effective Amendment No. 4 to Registration
Statement No. 33-55781 of our opinion dated December 28, 1998 appearing in the
Prospectus, which is part of such Registration Statement, and to the reference
to us under the heading 'Miscellaneous--Auditors' in such Prospectus.
DELOITTE & TOUCHE LLP
New York, N.Y.
January 14, 1999
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