As filed with the Securities and Exchange Commission April 28, 2000
Registration No. 2-10694
811-0091
______________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________________
FORM S-6
________________________
POST-EFFECTIVE AMENDMENT NO. 39 TO
REGISTRATION UNDER THE SECURITIES ACT
OF 1933 OF SECURITIES OF UNIT INVESTMENT
TRUSTS REGISTERED ON FORM N-8B-2
_________________________
A. Exact name of Trust:
LEXINGTON CORPORATE LEADERS TRUST FUND
B. Name of depositor:
Lexington Management Corporation
C. Complete address of depositor's principal executive offices:
Lexington Management Corporation
Park 80 West Plaza Two
Saddle Brook, New Jersey 07663
D. Name and address of agent for service:
Lisa Curcio
Lexington Corporate Leaders Trust Fund
Park 80 West Plaza Two
Saddle Brook, New Jersey 07663
With a copy to:
Carl Frischling, Esq.
Kramer Levin Naftalis & Frankel LLP
919 Third Avenue
New York, New York 10022
E. Amount of filing fee:
The Registrant has registered an indefinite number of shares
under the Securities Act of 1933 pursuant to Section 24(f)
of the Investment Company Act of 1940. A Rule 24f-2 Notice
for the Registrant's fiscal year ended December 31, 1999 was
filed on March 31, 2000.
F. Approximate date of proposed public offering:
It is proposed that this filing will become effective May 1, 2000
pursuant to paragraph (b) of Rule 485.
<PAGE>
LEXINGTON CORPORATE LEADERS TRUST FUND
CROSS-REFERENCE SHEET
Pursuant to Rule 404(c) of Regulation C under the Securities Act of 1933.
(Form N-8B-2 Items required by Instructions as to the Prospectus in Form S-6)
FORM N-8B-2 FORM S-6
Item Number Heading in Prospectus
- ----------- ---------------------
I. Organization and General Information
1. (a) Name of Trust and Tax I.D. Number Description of the Trust
(b) Title of securities issued Description of the Trust
2. Name and address of each depositor Cover
3. Name and address of trustee Cover
4. Name and address of principal Cover
underwriter
5. State of organization of Fund Description of the Trust
6. Execution and termination of Highlights; Amendment and
trust indenture Termination
7. Changes of Name Description of the Trust
8. Fiscal Year Miscellaneous
9. Litigation Miscellaneous
10. (a) Registered or bearer Purchase of Participations
(b) Cumulative or distributive Shareholder Services
securities
(c) Redemption How to Redeem Participations
(d) Conversion, transfer, etc. Shareholder Services
(e) Periodic Payment Plan *
(f) Voting Rights Amendment and Termination
<PAGE>
FORM N-8B-2 FORM S-6
Item Number Heading in Prospectus
- ----------- ---------------------
(g) Notice to holders Amendment and Termination
(h) Consents required Amendment and Termination
(i) Other provisions *
11. Type of securities comprising a Unit Description of the Trust
12. Certain information regarding *
periodic payment certificates
13. (a) Load, fees, expenses, etc. Purchase of Participations
(b) Certain information *
regarding periodic
payment certificates
(c) Certain percentages Purchase of Participations
(d) Certain differences in prices Purchase of Participations
(e) Certain other fees, etc. Purchase of Participations
payable by holders
(f) Certain other profits Miscellaneous
(g) Ratio of annual charges to income *
14. Issuance of trust's securities Purchase of Participations
15. Receipt and handling of payments from Description of the Trust
purchasers
16. Acquisition and disposition of Description of The Trust
underlying securities
17. Withdrawal or redemption Description of the Trust
(a) Receipt, custody and Shareholder Services
disposition of income
(b) Reinvestment of distributions Shareholder Services
(c) Reserves or special funds Shareholder Services
(d) Schedule of distributions Nonstandardized Investment
Return
19. Records, accounts and reports Purchase of Participations
20. Certain miscellaneous
provision of trust agreement
(a) Amendment Amendment and Termination
(b) Termination Amendment and Termination
(c)&(d) Trustee, removal and
successor Resignation, Removal, etc.
(e)&(f) Depositor, removal
and successor Resignation, Removal, etc.
21. Loans to security holders *
<PAGE>
FORM N-8B-2 FORM S-6
Item Number Heading in Prospectus
- ----------- ---------------------
22. Limitations on Liability Resignation, Removal, etc.
23. Bonding arrangements *
24. Other material provisions of
trust agreement Miscellaneous
III. Organization, Personnel and Affiliated
25. Organization of depositor Miscellaneous
26. Fees received by depositor Miscellaneous
27. Business of depositor Miscellaneous
28. Certain information as to Miscellaneous
officials and affiliated
persons of depositor
29. Voting securities of depositor Miscellaneous
30. Persons controlling depositor Miscellaneous
31. Payments by depositor for *
certain services
32. Payments by depositor for *
certain other services
rendered to trust
33. Remuneration of employees of *
depositor for certain services
rendered to trust
34. Remuneration of other persons *
for certain services rendered
to trust
IV. Distribution and Redemption of Securities
35. Distribution of trust's Purchase of Participations
securities by states
36. Suspension of sales of trust's *
securities
37. Revocation of authority to *
distribute
38. (a) Method of distribution *
(b) Underwriting agreements *
(c) Selling agreements *
<PAGE>
FORM N-8B-2 FORM S-6
Item Number Heading in Prospectus
- ----------- ---------------------
39. (a) Organization of principal Miscellaneous
underwriters
(b) N.A.S.D. membership of
principal underwriters Miscellaneous
40. Certain fees received by Purchase of Participations;
principal underwriters Miscellaneous
41. (a) Business of principal underwriters Miscellaneous
(b) Branch officers of principal
underwriters *
(c) Salesmen of principal
underwriters *
42. Ownership of trust's securities by Miscellaneous
certain persons
43. Certain brokerage commissions
by principal underwriters *
44. (a) Method of valuation How to Redeem Participations
(b) Schedule as to offering price
(c) Variation in offering price to
certain persons Purchase of Participations
45. Suspension of redemption rights How to Redeem Participations
46. (a) Redemption valuation How to Redeem Participations
(b) Schedule as to redemption price How to Redeem Participations
47. Maintenance of position in *
underlying securities
V. Information Concerning the Trustee or Custodian
48. Organization and regulation of Miscellaneous
trustee
49. Fees and expenses of trustee Miscellaneous
50. Trustee's lien *
VI. Information Concerning Insurance of Holders of Securities
51. Insurance of holders of *
Trust's securities
<PAGE>
FORM N-8B-2 FORM S-6
Item Number Heading in Prospectus
- ----------- ----------------------
VII. Policy of Registrant
52. (a) Provisions of trust Description of the Trust
agreement with respect to
selection or elimination
of underlying securities
(b) Transactions involving Description of the Trust
elimination of underlying
securities
(c) Policy regarding Description of the Trust
substitution elimination
of underlying securities
(d) Fundamental policy not *
otherwise covered
53. Tax status of trust Taxation
VIII. Financial and Statistical Information
54. Fund's securities during last Financial Statements
ten years
55. Certain information regarding *
periodic payment certificates
56. Certain information regarding *
periodic payment certificates
57. Certain information regarding *
periodic payment certificates
58. Certain information regarding *
periodic payment certificates
59. Financial statements Financial Statements
(Instruction 1(c) Form S-6)
<PAGE>
Prospectus
May 1, 2000
Lexington Global and Domestic No-Load Mutual Funds
LEXINGTON
CORPORATE LEADERS
TRUST FUND
----------------------------------------------
Objective: Long-term Capital Growth and Income
[LOGO]
LEXINGTON
These securities have not been approved nor disapproved by the Securities and
Exchange Commission or any state securities commission nor has the Securities
and Exchange Commission or any state securities commission passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is
a criminal offense.
<PAGE>
Prospectus dated May 1, 2000
LEXINGTON CORPORATE LEADERS
TRUST FUND
PARK 80 WEST, PLAZA TWO
SADDLE BROOK, NEW JERSEY 07663
Shareholder Services: 1-800-526-0056
Institutional/Financial Adviser Services: 1-800-367-9160
24 Hour Account Information: 1-800-526-0052
- -------------------------------------------------------------------------------
Lexington Corporate Leaders Trust Fund (the "Trust") was
created in 1935 with the objective of seeking long term capital
growth and income through investment generally in an equal
number of shares of the common stocks of a fixed list of
American blue chip corporations. See "Description of the Trust"
on page 2. Currently, the Trust is invested in twenty-five such
corporations including Eastman Kodak, General Electric, Exxon,
Mobil, Sears Roebuck and Citigroup. Investments in these
corporations, while having potential for long term capital
growth and income, may be considered conservative investments.
The value of participations of the Trust will fluctuate with the
market value of the underlying portfolio securities.
The minimum initial purchase requirement is $1,000 and
additional investments must be at least $50. Participations are
sold without a sales or redemption charge.
- -------------------------------------------------------------------------------
Sponsor: Trustee:
Lexington Management Corporation State Street Bank and Trust Company
Park 80 West, Plaza Two Mutual Fund Services Area
Saddle Brook, New Jersey 07663 Lexington Corporate Leaders Trust
Fund
Distributor: 225 Franklin Street
Boston, Massachusetts 02110
Lexington Funds Distributor, Inc.
Park 80 West, Plaza Two
Saddle Brook, New Jersey 07663
Participations are not deposits or obligations of (or endorsed or guaranteed
by) any bank, nor are they federally insured or otherwise protected by the
Federal Deposit Insurance Corporation ("FDIC"), the Federal Reserve Board or
any other agency. Investing in the Trust involves investment risks, including
the possible loss of principal, and their value and return will fluctuate.
- -------------------------------------------------------------------------------
These securities have not been approved or disapproved by the
Securities and Exchange Commission or any state securities
commission nor has the Securities and Exchange Commission or any
state securities commission passed upon the accuracy or adequacy
of this prospectus. Any representation to the contrary is a
criminal offense.
- -------------------------------------------------------------------------------
Read and Retain this Prospectus for Future Reference.
<PAGE>
HIGHLIGHTS
The Trust and Its Objective
THE TRUST WAS CREATED IN 1935 WITH THE OBJECTIVE OF SEEKING LONG TERM CAPI-
TAL GROWTH AND INCOME THROUGH INVESTMENT IN AN EQUAL NUMBER OF SHARES OF COM-
MON STOCK OF A FIXED LIST OF AMERICAN BLUE CHIP CORPORATIONS. CURRENTLY THE
TRUST IS INVESTED IN TWENTY-FIVE SUCH CORPORATIONS. THERE CAN BE NO ASSURANCE
THAT THE TRUST'S OBJECTIVE WILL BE ACHIEVED. SEE "DESCRIPTION OF THE TRUST"
HEREIN.
Public Offering Price
The initial purchase requirement for an investment in the Trust is $1,000
and additional investments must be at least $50. Investors receive a
fractional undivided interest in and ownership of the Trust Fund and
Distributive Fund described below which is called a participation.
Participations are offered at a price equal to the net asset value next
determined after an order is received.
Special Considerations
The value of a participation fluctuates with the market value of the
underlying portfolio securities of the Trust. The dividend income, if any,
from the portfolio securities is subject to fluctuation which in turn will
affect the amounts of distributions made to participants. An investor in the
Trust has no assurance against loss in a declining market, and redemption at a
time when the market value of the participations is less than their cost will
result in a loss to the investor.
Semi-Annual Distributions
Semi-annual distributions on June 30 and December 31 of each year
(Distribution Date) will be reinvested at net asset value in additional
participations of the Trust unless the participant notifies the Trustee to pay
such distributions in cash.
Taxation
For Federal income tax purposes, (1) the Trust will be treated as a fixed
investment trust and will not be subject to Federal income tax, (2) each
participant will be treated as the owner of his pro rata portion of the common
stock of the corporations held by the Trust, (3) each participant will be
required to include in his gross income his pro rata portion of the dividends
and interest received by the Trust (including the amounts of such dividends
and interest that are not distributed to participants but are used to pay the
fees and expenses of the Trust), at the time such dividends and interest are
received by the Trust, not at the later time such dividends and interests are
distributed to participants or reinvested in additional participations, and
(4) each individual participant who itemizes deductions may deduct his pro
rata portion of the fees and expenses of the Trust only to the extent such
amount, together with his other miscellaneous itemized deductions, exceeds 2%
of his adjusted gross income. See "Taxation" herein.
The Indenture
The Amended and Restated Indenture is effective as of November 14, 1989, as
amended on April 23, 1993 (the "Indenture"). Both the Indenture and the Trust
will terminate on November 30, 2100.
DESCRIPTION OF THE TRUST
Corporate Leaders Trust Fund was created under New York Law by an Indenture
dated November 18, 1935, as amended and supplemented, between Empire Trust
Company (now The Bank of New York by merger) as Trustee,
2
<PAGE>
and Corporate Leaders of America, Inc., as Sponsor. On October 29, 1971,
Corporate Leaders of America, Inc. was merged into Piedmont Capital
Corporation, which designated Manlex Corporation as Sponsor of the Trust on
March 25, 1981. On October 31, 1988 holders of Corporate Leaders Trust Fund
Certificates Series B voted to approve an Amended and Restated Indenture
which, among other things, designated Lexington Management Corporation, the
parent company of Manlex Corporation, as Sponsor, and changed the name to
Lexington Corporate Leaders Trust Fund (Federal I.D. #13-6061925). Holders of
Corporate Leaders Trust Fund Certificates Series A continue to be governed by
the initial Indenture. This Prospectus pertains solely to Lexington Corporate
Leaders Trust Fund Certificates Series B (herein referred to as the "Trust").
All discussions herein of articles and sections of the Indenture refer to the
Amended and Restated Indenture (the "Indenture").
The Trust is comprised of a Trust Fund and a Distributive Fund. The Trust
Fund is composed of stock units, each unit consisting of one share of common
stock of each of the twenty-five corporations (except with respect to shares
received from spin-offs of existing portfolio securities -- see discussion
below) and such cash as may be available for the purchase of stock units. Cash
received on sales of participations, (excluding the portion thereof, if any,
attributable to the value of, and therefore deposited in, the Distributive
Fund) including distributions by the Trust which are reinvested in additional
participations under the Distribution Reinvestment Program described herein,
is held in the Trust Fund without interest until receipt of sufficient cash to
purchase at least one hundred stock units. To the extent monies remain
uninvested in the Trust, the Trustee will derive a benefit therefrom.
All dividends and any other cash distributions received by the Trust with
respect to the common stock held in the Trust Fund are deposited in the
Distributive Fund. Any non-cash distributions received by the Trust with
respect to the common stock held in the Trust Fund (excluding additional
shares of common stock received upon a stock split, which shall remain as
assets of the Trust Fund) are sold by the Trustee and the proceeds of sale are
deposited in the Distributive Fund. The Trustee may invest the funds deposited
in the Distributive Fund in debt obligations issued or guaranteed by the
United States Government, its agencies or instrumentalities, or in repurchase
agreements collateralized by such United States Government obligations, which
mature prior, and as close as practicable, to the next Distribution Date. The
interest earned on such investments is also deposited in the Distributive
Fund. Fees and expenses of the Trust are paid from the Distributive Fund. The
Trustee may from time to time set aside out of the Distributive Fund a reserve
for payments of taxes or other governmental charges.
On each Distribution Date, the Trustee uses the money in the Distributive
Fund to purchase additional participations for participants under the
Distribution Reinvestment Program described herein, unless the participant has
elected to receive his distribution in cash.
In the event of the merger, consolidation, re-capitalization or readjustment
of the issuer of any portfolio security with any other corporation, the
Sponsor may instruct the Trustee, in writing, to accept or reject such offer
or take such other action as the Sponsor may deem proper. Any securities
received in exchange shall be held by the Portfolio and shall be subject to
the terms and conditions of the Amended and Restated Indenture to the same
extent as the securities originally held in the Portfolio. Securities received
pursuant to an exchange may result in the Trust holding fewer shares than
originally held in the Portfolio security. Each stock unit issued after the
effective date of such an exchange will include one share of the corporation
received on exchange.
The Trust will enter into repurchase agreements only with commercial banks
and dealers in U.S. government securities. Repurchase agreements when entered
into with dealers, will be fully collateralized including the interest earned
thereon during the entire term of the agreement. If the institution defaults
on the repurchase agreement, the Trust will retain possession of the
underlying securities. In addition, if bankruptcy proceedings are commenced
with respect to the seller, realization on the collateral by the Trust may be
delayed or limited and the Trust may incur additional costs. In such case the
Trust will be subject to risks associated with changes in the market value of
the collateral securities.
3
<PAGE>
The Trust is invested generally in an equal number of shares of the common
stock of a fixed list of twenty-five American corporations. The Trust's
holding in Gallaher Group Plc, a United Kingdom company traded on the New York
Stock Exchange is a result of its spinoff from Fortune Brands, Inc., a
portfolio security. The Trust's portfolio investments are not managed and are
expected to remain fixed. Of the securities held on December 31, 1999, 14.7%
were in consumer products, 16.3% were in international oil companies and 8.7%
were in chemical and fertilizer companies. A complete list of the securities
is contained in the financial statements included herein. The value of a
participation in the Trust fluctuates with the market value of the underlying
common stock held by the Trust. The dividend income, if any, from the common
stocks is subject to fluctuation, which, in turn will affect the amounts of
distributions made to participants.
The Sponsor may direct the Trustee to sell the shares of common stock of any
of the twenty-five corporations if (i) the corporation has failed to declare
or pay dividends on the common stock; (ii) a materially adverse legal
proceeding has been instituted which affects the declaration or payment of
dividends; (iii) a breach of covenant or warranty exists which may materially
affect the payment of dividends; (iv) a default in payment of principal or
income on any other outstanding securities of the corporation occurs which may
affect the payment of dividends; or (v) the common stock ceased to be listed
on the New York Stock Exchange and after fifteen days has not been reinstated.
The proceeds of any such sale shall be deposited in the Distributive Fund.
SELECTED FINANCIAL INFORMATION
The following table of selected financial information has been audited by
PriceWaterhouseCoopers LLP independent certified public accountants, for the
year ended December 31, 1999, whose report thereon appears elsewhere in this
prospectus, and by other auditors for prior years.
Per participation operating performance
(for a participation outstanding
throughout the period)
<TABLE>
<CAPTION>
Years Ended December 31,
-------------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994 1993 1992 1991 1990
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning year......... $15.70 $14.88 $16.05 $13.74 $10.51 $12.78 $11.62 $11.52 $10.53 $13.68
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Income from investment
operations:
Net investment income... .24 .23 .27 .28 .28 .31 .33 .36 .39 .43
Net realized and
unrealized gain (loss)
on investments......... 1.92 1.28 3.45 2.79 3.82 (.45) 1.71 .70 1.64 (.89)
------ ------ ------ ------ ------ ------ ------ ----- ------ ------
Total from investment
operations............. 2.16 1.51 3.72 3.07 4.10 (.14) 2.04 1.06 2.03 (.46)
------ ------ ------ ------ ------ ------ ------ ----- ------ ------
Less distributions:
Dividends from net
investment income...... (.24) (.23) (.28) (.28) (.28) (.32) (.33) (.35) (.40) (.43)
Distributions from net
realized gains......... (.15) (.26) (2.60) (.28) (.03) (.90) (.28) (.35) (.28) (1.29)
Distributions from
income and realized
gains included in
terminations........... (.02) (.02) (0.11) (.02) (.02) (.01) -- (.01) -- (.01)
Distributions from
capital................ (.15) (.18) (1.90) (.18) (.54) (.90) (.27) (.25) (.36) (.96)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Total distributions..... (.56) (.69) (4.89) (.76) (.87) (2.13) (.88) (.96) (1.04) (2.69)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Change in net asset
value for the year..... 1.60 .82 (1.17) 2.31 3.23 (2.27) 1.16 .10 .99 (3.15)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net asset value at end
of year................ $17.30 $15.70 $14.88 $16.05 $13.74 $10.51 $12.78 $11.62 $11.52 $10.53
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
Total Return............ 13.68% 9.94% 23.09% 22.43% 39.21% (0.77%) 17.57% 9.63% 19.41% (4.20%)
Ratio/Supplemental Data
Net Assets, end of year
(000).................. $463,995 $485,195 $525,669 $392,295 $256,467 $156,286 $147,181 $105,712 $98,104 $85,691
Ratios to average net
asset of:
Expenses................ .61% .65% .62% .63% .58% .62% .57% .60% .67% .67%
Net investment income... 1.41% 1.46% 1.76% 2.05% 2.57% 2.84% 2.78% 3.16% 3.46% 3.57%
</TABLE>
4
<PAGE>
HOW TO PURCHASE PARTICIPATIONS
Initial Investment--Minimum $1,000. By Mail: Send a check payable to Lexington
Corporate Leaders Trust Fund, along with a completed New Account Application
to State Street Bank and Trust Company (the "Agent"). To transmit funds by
wire, contact the Trust at 1-800-526-0056.
Subsequent Investments--Minimum $50. By Mail: Send a check payable to
Lexington Corporate Leaders Trust Fund, to the Agent, accompanied by either
the detachable form which is part of the confirmation of a prior transaction
or a letter indicating the dollar amount of the investment and identifying the
Trust, account number and registration. The Fund does not accept third party
checks or cash investments. Third party checks are defined as checks made
payable to someone other than the Fund. Checks must be in U.S. dollars, and to
avoid fees and delays, drawn only on banks located in the U.S.
Broker-Dealers: You may invest in participations of the Trust through broker-
dealers who are members of the National Association of Securities Dealers,
Inc., and other financial institutions and who have selling agreements with
Lexington Funds Distributor, Inc. Broker-dealers and financial institutions
who process such purchase and sale transactions for their customers may charge
a transaction fee for these services. The fee may be avoided by purchasing
participations directly from the Trust.
The Open Account: By investing in the Trust, a shareholder appoints the Agent,
as his agent, to establish an open account to which all participations
purchased, including additional participations purchased under the
Distribution Reinvestment Program, will be credited. Participation
certificates will be issued for full participations only when requested in
writing. Unless payment for participations is made by certified or cashier's
check or federal funds wire, certificates will not be issued for 30 days. In
order to facilitate redemptions and transfers, most participation holders
elect not to receive certificates.
After an Open Account is established, payments can be provided for by "Lex-
O-Matic" or other authorized automatic bank check program accounts (checks
drawn on the investor's bank periodically for investment in the Trust).
Automatic Investing Plan with "Lex-O-Matic". A shareholder may arrange to
make additional purchases of shares automatically on a monthly or quarterly
basis. The investments of $50 or more are automatically deducted from a
checking account on or about the 15th day of each month. The institution must
be an Automated Clearing House (ACH) member. Should an order to purchase
shares of a fund be cancelled because your automated transfer does not clear,
you will be responsible for any resulting loss incurred by that fund. The
shareholder reserves the right to discontinue the Lex-O-Matic program provided
written notice is given ten days prior to the scheduled investment date.
Further information regarding this service can be obtained from Lexington by
calling 1-800-526-0056.
On payroll deduction accounts administered by an employer and on payments
into qualified pension or profit sharing plans and other continuing purchase
programs, there are no minimum purchase requirements.
Terms of Offering: If an order to purchase participations is cancelled because
the investor's check does not clear, the purchaser will be responsible for any
loss incurred by the Trust. To recover any such loss the Trust reserves the
right to redeem participations owned by the purchaser, and may prohibit or
restrict the purchaser in placing future orders in any of the Lexington Funds.
5
<PAGE>
The Trust reserves the right to reject any order, and to waive or lower the
investment minimums with respect to any person or class of persons, including
participation holders of the Trust's special investment programs. An order to
purchase participations is not binding on the Trust until it has been
confirmed by the Agent.
Shareholder Servicing Agents: The Trust may enter into Shareholder Servicing
Agreements with one or more Shareholder Servicing Agents. The Shareholder Ser-
vicing Agent may, as agent for its customers, among other things: answer cus-
tomer inquiries regarding account status, account history and purchase and re-
demption procedures; assist shareholders in designating and changing dividend
options, account designations and addresses; provide necessary personnel and
facilities to establish and maintain shareholder accounts and records; assist
in processing purchase and redemption transactions; arrange for the wiring of
funds; transmit and receive funds in connection with customer orders to pur-
chase or redeem shares; verify and guarantee shareholder signatures in connec-
tion with redemption orders and transfers and changes in shareholder-desig-
nated accounts; furnish monthly and year-end statements and confirmations of
purchases and redemptions; transmit, on behalf of the Trust, proxy statements,
annual reports, updated prospectuses and other communications to shareholders
of the Trust; receive, tabulate and transmit to the Trust proxies executed by
shareholders with respect to meetings of shareholders of the Trust; and pro-
vide such other related services as the Trust or a shareholder may request.
For these services, each Shareholder Servicing Agent receives fees, which may
be paid periodically, provided that such fees will not exceed, on an annual
basis, 0.25% of the average daily net assets of the Trust represented by par-
ticipations owned during the period for which payment is made. LMC, at no cost
to the Trust, may pay to Shareholder Servicing Agents additional amounts from
its past profits. Each Shareholder Servicing Agent may, from time to time,
voluntarily waive all or a portion of the fees payable to it.
Account Statements: The agent will send participation holders either
purchasing or redeeming participations of the Trust, a confirmation of the
transaction indicating the date the purchase or redemption was accepted, the
number of participations purchased or redeemed, the purchase or redemption
price per participation, and the amount purchased or redemption proceeds. A
statement is also sent to participation holders whenever a distribution is
paid, or when a change in the registration, address, or dividend option
occurs. Participation holders are urged to retain their account statements for
tax purposes.
HOW TO REDEEM PARTICIPATIONS
By Mail: Send to the Agent (see the back cover of this prospectus for the
Agent's address): (1) a written request for redemption, signed by each regis-
tered owner exactly as the participations are registered including the name of
the Trust, account number and exact registration; (2) participation certifi-
cates for any participations to be redeemed which are held by the participa-
tion holder; (3) signature guarantees, when required, and (4) the additional
documents required for redemptions by corporations, executors, administrators,
trustees, and guardians. Redemptions by mail will not become effective until
all documents in proper form have been received by the Agent. If a participa-
tion holder has any questions regarding the requirements for redeeming partic-
ipations, he should call the Trust at the toll free number on the back cover
prior to submitting a redemption request. If a redemption request is sent to
the Trust in New Jersey, it will be forwarded to the Agent and the effective
date of redemption will be the date received by the Agent.
Checks for redemption proceeds will normally be mailed within three business
days, but will not be mailed until all checks in payment for the
participations to be redeemed have been cleared. The Transfer Agent will
restrict the mailing of redemption proceeds to a participation holder's
address of record within 30 days of such address being changed unless the
participation holder provides a signature guaranteed letter of instruction.
6
<PAGE>
By Telephone: To establish this privilege on your account, please call our
Shareholder Services Department at 1-800-526-0056 between 9:00 a.m. and 5:00
p.m. Eastern Time and request a telephone authorization form.
Shareholders redeeming at least $1,000 worth of shares (for which
certificates have not been issued) may effect a telephone redemption by
calling our Shareholder Services Department at 1-800-526-0056 Monday - Friday
between 9:00 a.m. and 4:00 p.m. Eastern Time. A telephone redemption in good
order will be processed at the net asset value of the Trust next determined.
There is a maximum telephone redemption limit of $100,000.
The redemption proceeds will be made payable to the registered
shareholder(s) and forwarded to the address of record. The Transfer Agent will
restrict the mailing of telephone redemption proceeds to a participation
holder's address of record within 30 days of such address being changed,
unless the participation holder provides a signature guaranteed letter of
instruction (See "Telephone Exchange/Redemption Provisions").
Signature Guarantee: Signature guarantees are required in connection with (a)
redemptions by mail involving $25,000 or more; (b) all redemptions by mail,
regardless of the amount involved, when the proceeds are to be paid to someone
other than the registered owners; (c) changes in instructions as to where the
proceeds of redemptions are to be sent, and (d) participation transfer
requests.
The Agent requires that the guarantor be either a commercial bank which is a
member of the Federal Deposit Insurance Corporation, a trust company, a
savings and loan association, a savings bank, a credit union, a member firm of
a domestic stock exchange, or a foreign branch of any of the foregoing. A
notary public is not an acceptable guarantor.
With respect to redemption requests submitted by mail, the signature
guarantees must appear either: (a) on the written request for redemption, (b)
on a separate instrument of assignment ("stock power") specifying the total
number of participations to be redeemed, or (c) on all participation
certificates tendered for redemption and, if participations held by the Agent
are also being redeemed, on the letter or stock power.
Redemption Price: The redemption price will be the net asset value per
participation of the Trust next determined after receipt by the Agent of a
redemption request in proper form.
The redemption price per participation is computed on (i) any Trust business
day, which is each day on which the New York Stock Exchange, the Federal
Reserve Bank of New York and the Trustee are open for business and on such
other days as there is sufficient trading in the Trust's securities to
materially affect net asset value per participation except for certain
national holidays. The calculation is made by (a) adding: (i) the aggregate
value of the portfolio securities; (ii) available cash; (iii) amounts in the
Distributive Fund, including dividends on the portfolio securities and
interest on the investment of monies in the Distributive Fund; and (iv) any
other assets of the Trust and (b) deducting: (i) taxes and other governmental
charges; (ii) fees and expenses of the Trust; (iii) cash allocated for
distribution to participants of record as of a date prior to the evaluation;
and (iv) any other liabilities of the Trust.
Participations will be redeemed in cash from the Trust Fund and the
Distributive Fund at a price equal to the next determined participation value
following receipt of an appropriate request multiplied by the number of
participations being redeemed and subject to payment by the participant of any
tax or other governmental charge. If there is insufficient cash in the Trust
Fund to pay the portion of the redemption price attributable thereto, the
Trustee shall sell stock units. Sales of such securities will be at the best
price obtainable subject to any minimum value limitations on sales specified
by the Sponsor.
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A security listed or traded on a recognized stock exchange is valued at its
last sale price prior to the time when assets are valued on the principal
exchange on which the security is traded. If no sale is reported at that time,
the mean between the current bid and asked price will be used. All other
securities for which over-the-counter market quotations are readily available
are valued at the mean between the last current bid and asked price. Short-
term securities having maturity of 60 days or less are valued at cost, when it
is determined by the Trustee that amortized cost reflects the fair value of
such securities. Securities for which market quotations are not readily
available and other assets are valued at fair value as determined in good
faith by the Trustee.
The right of redemption may be suspended (a) for any period during which the
New York Stock Exchange is closed or the Securities and Exchange Commission
("SEC") determines that trading on the Exchange is restricted, (b) when there
is an emergency as determined by the SEC as a result of which it is not
reasonably practicable for the Trust to dispose of securities owned by it or
to determine fairly the value of its net assets, or (c) for such other periods
as the SEC may by order permit for the protection of participants. Due to the
proportionately high cost of maintaining smaller accounts, the Trust reserves
the right to redeem all participations in an account with a value of less than
$500 other than as a result of a change in net asset value and mail the
proceeds to the participant. Participants will be notified before these
redemptions are to be made and will have thirty (30) days to make an
additional investment to bring their accounts up to the required minimum.
SHAREHOLDER SERVICES
Transfer
Participations may be transferred to another owner. A signature guarantee of
the registered participant is required on the letter of instruction or other
instrument of assignment.
Systematic Withdrawal Plan
Participants may elect to withdraw cash in fixed amounts from their accounts
at regular intervals. The minimum investment to establish a Systematic
Withdrawal Plan is $10,000. If the proceeds are to be mailed to someone other
than the registered owner, a signature guarantee is required.
Group Sub-Accounting: To minimize recordkeeping by fiduciaries, corporations
and certain other investors, the minimum initial investment may be waived.
EXCHANGE PRIVILEGE
Participations may be exchanged for shares of the following funds managed by
the Sponsor, Lexington Management Corporation, (the "Lexington Funds") on the
basis of relative net asset value per share at the time of the exchange. In
the event shares of one or more of these funds being exchanged by a single in-
vestor have a value in excess of $500,000, participations may not be purchased
until the third business day following the redemption of the shares being ex-
changed in order to enable the redeeming fund to utilize normal securities
settlement procedures in transferring the proceeds of the redemption to the
Trust. Exchanges may not be made until all checks in payment for participa-
tions to be exchanged have been cleared.
The Lexington Funds currently available for exchange are:
LEXINGTON WORLDWIDE EMERGING MARKETS FUND, INC. (NASDAQ Symbol: LEXGX)/Seeks
long-term growth of capital primarily through investment in equity
securities of companies domiciled in, or doing business in, emerging
countries and emerging markets.
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LEXINGTON INTERNATIONAL FUND, INC.* (NASDAQ Symbol: LEXIX)/Seeks long term
growth of capital through investment in common stocks of companies
domiciled in foreign countries.
LEXINGTON GLOBAL CORPORATE LEADERS FUND, INC.* (NASDAQ Symbol: LXGLX)/Seeks
long-term growth of capital primarily through investment in common
stocks of blue chip companies domiciled in foreign countries and the
United States that represent corporate leaders in their respective
industries.
LEXINGTON SMALL CAP ASIA GROWTH FUND, INC.* (NASDAQ Symbol: LXCAX)/Seeks long-
term capital appreciation through investment in companies domiciled in
the Asia Region with a market capitalization of less than $1 billion.
LEXINGTON TROIKA DIALOG RUSSIA FUND, INC.* (NASDAQ Symbol: LEXTRX)/Seeks long-
term capital appreciation through investment primarily in the equity
securities of Russian companies. The Fund has a $5,000 minimum invest-
ment.
LEXINGTON GLOBAL INCOME FUND* (NASDAQ Symbol: LEBDX)/Seeks high current income
by investing in a combination of foreign and domestic high-yield, lower
rated debt securities. Capital appreciation is a secondary objective.
LEXINGTON SILVER FUND, INC. (NASDAQ Symbol: STSLX)/Seeks long-term growth of
capital and income principally through investment in a portfolio of
securities which are engaged in the exploration, mining, processing,
fabrication or distribution of silver and in silver bullion.
LEXINGTON GOLDFUND, INC.* (NASDAQ Symbol: LEXMX)/Seeks capital appreciation
and such hedge against loss of buying power as may be obtained through
investment in gold bullion and equity securities of companies engaged
in mining or processing gold throughout the world.
LEXINGTON CORPORATE LEADERS TRUST FUND (NASDAQ Symbol: LEXCX)/Seeks long-term
capital growth and income through investment in an equal number of
shares of the common stocks of a fixed list of American blue chip
corporations.
LEXINGTON GROWTH AND INCOME FUND, INC. (NASDAQ Symbol: LEXRX)/Seeks long-term
capital appreciation through investments in stocks of large, ably
managed and well financed companies. Income is a secondary objective.
LEXINGTON GNMA INCOME FUND, INC. (NASDAQ Symbol: LEXNX)/Seeks a high level of
current income, consistent with liquidity and safety of principal,
through investment primarily in mortgage-backed GNMA Certificates.
LEXINGTON MONEY MARKET TRUST (NASDAQ Symbol: LMMXX)/Seeks a high level of
current income consistent with preservation of capital and liquidity
through investments in interest bearing short term money market
instruments.
*These Funds are not available for exchange until exemptive relief is
received from the SEC.
The Exchange Privilege enables a participant to acquire another Lexington
Fund with a different investment objective when the participant believes that
a shift between funds is an appropriate investment decision. Participants con-
templating an exchange should obtain and review the prospectus of the Fund to
be acquired. If an
9
<PAGE>
exchange involves investing in a Lexington Fund not already owned and a new
account has to be established, the dollar amount exchanged must meet the
minimum initial investment of the Fund being purchased. If, however, an
account already exists in the Fund being bought, there is a $500 minimum
exchange required. Participants must provide the account number of the
existing account. Any exchange between Funds is, in effect, a redemption in
one Fund and a purchase in the other Fund. Participants should consider the
possible tax effects of an exchange.
Telephone Exchange/Redemption Provisions
Exchange or redemption instructions may be given in writing or by telephone.
Telephone exchanges/ redemptions may only be made if a Telephone Authorization
Form has been previously executed and filed with the Sponsor. Telephone
exchanges/redemptions are permitted only after a minimum of seven (7) days
have elapsed from the date of a previous exchange/redemption.
Exchanges/redemptions may not be made until all checks in payment for
participations to be exchanged have been cleared.
Telephonic exchanges/redemptions can only involve participants registered on
the books of the Trustee; participations held in certificate form cannot be
included. However, outstanding certificates can be returned to the Trustee and
qualify for these services. Any new account established with the same
registration will also have the privileges of exchange/redemption by telephone
in the Lexington Funds. All accounts involved in a telephonic exchange must
have the same registration and dividend option as the account from which the
participations were transferred and will also have the privilege of exchange
by telephone in the Lexington Funds in which these services are available.
By checking the box on the Purchase Application authorizing telephone
exchange and/or telephone redemption services, a participant constitutes and
appoints Lexington Funds Distributor, Inc. ("LFD"), distributor of the
Lexington Funds, as the true and lawful attorney to surrender for redemption
or exchange any and all non-certificate shares held by the Trustee in
account(s) designated, or in any other account with the Lexington Funds,
present or future which has the identical registration with full power of
substitution in the premises and authorizes and directs LFD to act upon any
instruction from any person by telephone for exchange of shares held in any of
these accounts, to purchase shares of any other Lexington Fund that is
available, provided the registration and mailing address of the shares to be
purchased are identical to the shares being redeemed, and agrees that neither
LFD, the Trustee, the Trust or the Lexington Fund(s) will be liable for any
loss, expense or cost arising out of any requests effected in accordance with
this authorization which would include requests effected by imposters or
persons otherwise unauthorized to act on behalf of the account. LFD, the Agent
and the Fund, will employ reasonable procedures to confirm that instructions
communicated by telephone are genuine and if they do not employ reasonable
procedures they may be liable for any losses due to unauthorized or fraudulent
instructions. The following identification procedures may include, but are not
limited to, the following: account number, registration and address, taxpayer
identification number and other information particular to the account. In
addition, all exchange transactions will take place on recorded telephone
lines and each transaction will be confirmed in writing by the Fund. LFD
reserves the right to cease to act as agent subject to the above appointment
upon thirty (30) days' written notice to the address of record. If the
participant is an entity other than an individual, such entity may be required
to certify that certain persons have been duly elected and are now legally
holding the titles given and that the said corporation, trust, unincorporated
association, etc., is duly organized and existing and has the power to take
action called for by this continuing authorization.
Exchange Authorization Forms, telephone authorization forms and prospectuses
of the other Lexington Funds may be obtained from LFD.
10
<PAGE>
LFD has made arrangements with certain dealers to accept instructions by
telephone to exchange participations for shares of one of the other Lexington
Funds at net asset value as described above. Under this procedure, the dealer
must agree to indemnify LFD and the Lexington Funds from any loss or liability
that any of them might incur as a result of the acceptance of such telephone
exchange orders. A properly signed exchange application must be received by
the Distributor within five (5) days of the exchange request. In each such ex-
change, the registration of the shares of the Fund being acquired must be
identical to the registration of the participations of the Fund being ex-
changed. Participations in certificate form are not eligible for this type of
exchange. LFD reserves the right to reject any telephone exchange request. Any
telephone exchange orders so rejected may be processed by mail.
Tax Sheltered Retirement Plans
The Trust offers a Prototype Pension and Profit Sharing Plan, including a
Keogh Plan, IRA's, SEP-IRA Rollover Accounts, 401(k) Salary Reduction Plans,
Section 457 Deferred Compensation Plans and 403(b)(7) Plans. Plan support
services are available through the Shareholder Services Department of the
Sponsor. For further information, call 1-800-526-0056. An investor participat-
ing in any of the Trust's special plans has no obligation to continue to in-
vest in the Trust and may terminate the Plan with the Trust at any time. Ex-
cept for expenses of sales and promotion, executive and administrative person-
nel, and certain services which are furnished by Sponsor, the cost of the
plans generally is borne by the Trust; however, each IRA Plan account is sub-
ject to an annual maintenance fee of $12.00 charged by the Trustee.
Distribution Reinvestment Program
On June 30 and December 31 of each year, the Distribution Dates, the Trustee
will compute to at least two decimal places the amount of the semi-annual
distribution per participation for participants of record, and shall use such
distributions to purchase additional participations unless the Trustee has
been instructed by the participant, in writing, prior to the Distribution Date
to pay such distributions in cash.
TAX MATTERS
The Trust is treated as a fixed investment trust under the Internal Revenue
Code of 1986, as amended (the "Code"), and not an association taxable as a
corporation. The Trust is also treated as a grantor trust under the Code. As a
result, the Trust will not be subject to Federal income taxes. In addition,
for Federal income tax purposes, each participant is treated as the owner of
his pro rata portion (i.e., the ratio of the number of participations owned by
the participant to the total number of participations outstanding) of (i) the
common stock of each corporation and any cash held in the Trust Fund and (ii)
the securities and cash held in the Distributive Fund.
Each participant is treated as receiving his pro rata portion of dividends
and any other distributions received by the Trust on the common stock of the
corporations held in the Trust Fund and interest received by the Trust from
the investment of such dividends (and any other amounts) deposited in the
Distributive Fund. Each participant shall include in gross income his pro rata
portion of such dividends and interest when such dividends and interest are
received by the Trust (or, in the case of an accrual basis participant, as
such interest accrues), regardless of when such dividends and interest are
distributed by the Trust to participants (or reinvested in additional
participations) and regardless of the fact that a portion of such dividends
and interest are not distributed to participants (or reinvested in additional
participations) but rather are used to pay the fees and expenses of the Trust.
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<PAGE>
A corporate participant will generally be entitled to the 70% dividends-
received deduction with respect to the dividends so included in its gross
income, subject to various limitations and restrictions imposed by the Code. A
corporate participant will also be entitled to a deduction for his pro rata
portion of fees and expenses paid by the Trust. An individual participant who
itemizes deductions will be entitled to a deduction for his pro rata portion
of fees and expenses paid by the Trust only to the extent that such amount,
together with the participant's other miscellaneous itemized deductions, as
defined by the Code, exceeds 2% of the participant's adjusted gross income.
Furthermore, individual participants, whose adjusted gross income ("AGI")
exceeds a certain inflation-adjusted threshold amount must reduce their
itemized deductions (subject to specific exceptions such as medical expense,
investment interest and casualty/wagering/theft loss deductions) by 3% of this
excess. This reduction, however, is limited to no more than 80% of the
applicable itemized deductions. In 1999, the threshold amount was $126,600
($63,300 for married filing separately).
The purchase price paid by a participant for his participations (excluding
any portion thereof attributable to, and to be deposited in, the Distributive
Fund) shall be allocated (based upon relative fair market values) among the
participant's pro rata portion of the common stock of each corporation and any
cash held in the Trust Fund, in order to determine his tax basis in his pro
rata portion of the common stock of each corporation. If the common stock of
any of the corporations held in the Trust Fund is sold by the Trust, each
participant will be considered to have sold his pro rata portion of the common
stock of that corporation and will be considered to have received his pro rata
portion of the sale proceeds received by the Trust. If a participant redeems
his participations, he will be considered to have sold his pro rata portion of
the common stock of each corporation. The redemption price received by the
participant (excluding any portion thereof attributable to, and paid out of,
the Distributive Fund) shall be allocated (based upon relative fair market
values) among his pro rata portion of the common stock of each corporation and
any cash held in the Trust Fund. If a participant is considered to have sold
his pro rata portion of the common stock of any corporation, he will recognize
a capital gain or loss equal to the difference between the amount he is
considered to have received with respect thereto and his tax basis therein.
Any such capital gain or loss generally will be long-term capital gain or loss
if the participant held his participations for more than one year.
Under the back-up withholding rules of the Code, certain shareholders may be
subject to 31% withholding of federal income tax on distributions and
redemption payments made by the Trust. In order to avoid this back-up
withholding, a shareholder must provide the Trust with a correct taxpayer
identification number (which for most individuals is their Social Security
number) or certify that it is a corporation or otherwise exempt from or not
subject to back-up withholding. The new account application included with this
Prospectus provides for shareholder compliance with these certification
requirements.
Information concerning the Federal income tax status of distributions will
be mailed to participants annually. Prospective participants are urged to
consult their own tax advisers as to the tax consequences of an investment in
the Trust.
INVESTMENT RETURN
The Trust may, from time to time, include total return information in
advertisements and reports to shareholders. The average annual total return of
the Trust for the 1, 5 and 10 years ended December 31, 1999 is set forth in
the following table:
<TABLE>
<CAPTION>
Average Annual
Period Total Return
------ --------------
<S> <C>
1 year ended December 31, 1999 +13.68%
5 years ended December 31, 1999 +21.26%
10 years ended December 31, 1999 +14.39%
</TABLE>
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This performance is calculated pursuant to the formula P(1+T)(n) = ERV
(where P = a hypothetical investment of $1,000; T = the average annual total
return; n = the number of years and ERV = the ending redeemable value of the
hypothetical $1,000 investment). The computation reflects the reinvestment of
all dividends and distributions reinvested on participations acquired with the
original hypothetical $1,000 investment. Past results are not necessarily
representative of future results.
Comparative performance information may be used from time to time in
advertising or marketing of the Trust's participations, including data from
Lipper, Inc. the Dow Jones Industrial Average Index and Standard & Poor's 500
Composite Stock Index. Such comparative performance information will be stated
in the same terms in which the comparative data and indices are stated.
AMENDMENT AND TERMINATION
The Sponsor and Trustee may amend the Indenture without the consent of
participants (i) to cure any ambiguity or to correct or supplement any
provision contained herein which may be defective or inconsistent; (ii) to
change any provision as may be required by the SEC or any successor
governmental agency; or (iii) to make any other provisions which do not
adversely affect the interest of participants. The Indenture may be amended by
the Sponsor and the Trustee with the consent of a majority of the
participations entitled to vote.
The Trust and Indenture will terminate on November 30, 2100 upon the sale or
disposition of the last portfolio security of the Trust unless terminated
sooner by written instrument executed by the Sponsor and consented to by
participants owning 51% of the then outstanding participations. The Trustee
will deliver written notice of any termination to each participant specifying
the times at which the participants may surrender their certificates for
cancellation. Within a reasonable period of time after the termination, the
Trustee will distribute to each participant registered on the Trustee's books
in uncertificated form, and to each other participant upon surrender for
cancellation of his certificate, after deducting all unpaid expenses, fees,
taxes and other governmental charges, the participant's interest in the
Distributive Fund (into which had been deposited the proceeds from the sale of
the portfolio securities) and furnish to each participant a final account
statement.
RESIGNATION, REMOVAL AND LIMITATIONS ON LIABILITY OF SPONSOR
Sponsor
The Sponsor may resign upon written notice to the Trustee. The resignation
will not become effective unless the Trustee shall have appointed a successor
sponsor to assume, with such compensation as the Trustee may deem desirable,
the duties of the resigning Sponsor. If the Sponsor fails to perform its
duties for 30 days after notice from the Trustee, or becomes incapable of
acting or becomes bankrupt or its affairs are taken over by a public official,
then the Sponsor will be automatically discharged. The Sponsor shall be under
no liability to the Trust or to the participants for taking any action or for
refraining from taking any action in good faith or for errors in judgment or
for depreciation or loss incurred by reason of the purchase or sale of any
portfolio security. This provision, however, shall not protect the Sponsor in
cases of willful misfeasance, bad faith, gross negligence or reckless
disregard of its obligations and duties.
Trustee
The Trustee may resign upon written notice to the Sponsor and by mailing a
copy of such notice to all participants of record not less than sixty days
prior to the effective date of their resignation. The Sponsor shall
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<PAGE>
then use its best efforts to promptly appoint a successor trustee, and if upon
resignation of the Trustee no successor has been appointed within thirty days
after notification, the Trustee may apply to a court of competent jurisdiction
for the appointment of a successor. If, after such an application by the
Trustee is made to a court of competent jurisdiction (after November 30, 2015)
and the court is unable to appoint a successor trustee, then no earlier than
six months after the date of such application, the Trustee may notify each
participant and the Sponsor that the Trust shall terminate on a day no earlier
than six months from the date of such notice unless a successor trustee is
appointed. If the Trustee fails to perform its duties or becomes incapable of
acting or becomes bankrupt or a public official takes over its affairs, the
Sponsor may remove the Trustee and appoint a successor trustee by written
notice to the Trustee. The Trustee shall be under no liability for any action
taken in good faith in reliance upon prima facie properly executed documents
or for the disposition of monies or portfolio securities. This provision shall
not protect the Trustee in cases of willful misfeasance, bad faith, gross
negligence or reckless disregard of its obligations and duties. The Trustee
will not be responsible for the misconduct of any of its agents, attorneys or
accountants if they were selected with reasonable care.
MISCELLANEOUS
Trustee
The Trustee is State Street Bank and Trust Company (Federal I.D. #04-
1867445), a trust company incorporated under the laws of Massachusetts and
subject to regulation by the Federal Deposit Insurance Corporation and the
Commissioner of Banks of Massachusetts. Its principal office is at 225
Franklin Street, Boston, Massachusetts 02110. The Trustee receives a fee of
$10,000 per year for its services as set forth in the Indenture and is
reimbursed for all of its disbursements relating to the Trust. In addition,
the Trustee receives fees for acting as Custodian and Transfer Agent and for
providing portfolio, tax accounting and recordkeeping services. During the
year ended December 31, 1999, aggregate fees received by the Trustee were
$145,535.
Sponsor
The Sponsor, Lexington Management Corporation ("LMC") (Federal I.D. #22-
1891864), a Delaware corporation, serves as investment adviser and sponsor to
14 registered investment companies and to private and institutional investment
accounts. The Sponsor is responsible for performing certain administrative
services for the Trust including shareholder servicing, answering inquiries,
blue sky compliance and accounting. For performing such administrative
services the Sponsor receives an annual fee of .40% of the Trust's average
daily net assets. For the year ended December 31, 1999, the Sponsor received
fees of $1,887,832.
The Sponsor is a wholly-owned subsidiary of Lexington Global Asset Managers,
Inc. ("LGAM"), a Delaware corporation with offices at Park 80 West Plaza Two,
Saddle Brook, New Jersey 07663. Descendants of Lunsford Richardson, Sr., their
spouses, trusts and other related entities have a majority voting control of
outstanding shares of Lexington Global Asset Managers, Inc.
LGAM has entered into an agreement with ReliaStar Financial Corp.
("ReliaStar") for ReliaStar to acquire LGAM. ReliaStar is a Minneapolis-based
holding company whose subsidiaries offer individuals and institutions life
insurance and annuities, employee benefit products and services, life and
health reinsurance, retirement plans, mutual funds, bank products and personal
finance education. Completion of the acquisition is subject to customary
conditions, including regulatory approvals and approval by LGAM shareholders.
State Street Bank and Trust Company (the "Trustee"), will be asked by LMC to
appoint Pilgrim Investments, Inc. ("Pilgrim"), an indirect, wholly-owned
subsidiary of ReliaStar, as successor sponsor upon the resignation of LMC.
Pilgrim is a registered investment adviser that, as of September 30, 1999,
managed over $7.7 billion in assets. If the Trustee appoints Pilgrim the
successor sponsor, such appointment shall become effective upon LMC's
resignation of its position as sponsor.
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<PAGE>
The principal officers and the directors of the Sponsor and their principal
occupations during the past five years are as follows:
*Robert M. DeMichele Chairman and Chief Executive Officer, Lexington Manage-
ment Corporation; President and Director, Lexington
Global Asset Managers, Inc.; Chairman and Chief Execu-
tive Officer, Lexington Funds Distributor, Inc.; Chair-
man of the Board, Market Systems Research, Inc. and Mar-
ket Systems Research Advisors, Inc.; Director, Claredon
National Insurance Company, and The Navigator's Group,
Inc.; Vice Chairman of the Board of Trustees, Union Col-
lege and Trustee, Smith Richardson Foundation.
*Richard M. Hisey Chief Financial Officer, Managing Director and Director,
Lexington Management Corporation; Chief Financial Offi-
cer, Vice President and Director, Lexington Funds Dis-
tributor, Inc.; Chief Financial Officer, Market Systems
Research Advisors, Inc.; Executive Vice President, and
General Manager--Mutual Funds and Chief Financial Offi-
cer, Lexington Global Asset Managers, Inc.
Stuart S. Richardson Director, Lexington Management Corporation; Chairman,
Lexington Global Asset Managers, Inc.; Vice Chairman,
Vanguard Cellular Systems, Inc. Prior to January 1986,
Chairman, Richardson-Vicks, Inc.
*Lisa Curcio Senior Vice President and Secretary, Lexington Manage-
ment Corporation; Vice President and Secretary, Lexing-
ton Funds Distributor, Inc.; Secretary, Lexington Global
Asset Managers, Inc.
During its last fiscal year ended December 31, 1999, the Sponsor paid all
its salaried officers a total of $5,116,156.
- --------
* Messrs. DeMichele and Hisey and Ms. Curcio hold officer, director and/or
trustee positions with some or all of the registered investment companies
advised and/or distributed by Lexington Management Corporation and Lexington
Funds Distributor, Inc.
Distributor
State Street Bank and Trust Company has appointed Lexington Funds
Distributor, Inc., a registered broker-dealer to act as distributor to the
Trust. Lexington Funds Distributor, Inc. is a wholly-owned subsidiary of
Lexington Global Asset Managers, Inc., and receives no compensation for its
services.
Legal Opinion
The legality of the participations has been passed upon by Kramer Levin
Naftalis & Frankel LLP, 919 Third Avenue, New York, New York 10022, as counsel
for the Trust.
Auditors
Financial Statements have been examined by PriceWaterhouseCoopers LLP
independent certified public accountants, as stated in their opinion appearing
herein and has been so included in reliance upon that opinion given on the
authority of that firm as experts in accounting and auditing.
15
<PAGE>
This Prospectus does not contain all of the information with respect to the
investment company set forth in its registration statements and exhibits
relating thereto which have been filed with the Securities and Exchange
Commission, Washington, D.C. under the Securities Act of 1933 and the
Investment Company Act of 1940, and to which reference is hereby made.
* * * * *
No person is authorized to give any information or to make any
representations not contained in this Prospectus; and any information or
representation not contained herein must not be relied upon as having been
authorized by the Trust, the Trustee or the Sponsor. The Trust is registered
as a unit investment trust under the Investment Company Act of 1940. Such
registration does not imply that the Trust has been guaranteed, sponsored,
recommended or approved by the United States or any state or any agency or
officer thereof.
* * * * *
This Prospectus does not constitute an offer to sell, or a solicitation of
an offer to buy securities in any state to any person to whom it is not lawful
to make such offer in such state.
16
<PAGE>
IF YOU HAD INVESTED $10,000 59 YEARS AGO
ILLUSTRATION OF AN ASSUMED INVESTMENT OF $10,000
With Income Dividends and Capital Gains Distributions Reinvested
The table on the following page covers the period from March 16, 1941 to
December 31, 1999. This period was one of generally rising common stock
prices. The results shown should not be considered as a representation of the
dividends and other distributions which may be realized from an investment
made in the Trust today. A program of the type illustrated does not assure a
profit or protect against depreciation in declining markets.
Long-term investments in industry, such as Lexington Corporate Leaders Trust
Fund, tend to move with the basic inflationary trend and offer your dollars an
opportunity to grow.
- -------------------------------------------------------------------------------
LEXINGTON CORPORATE LEADERS TRUST FUND
- -------------------------------------------------------------------------------
Cumulative cost figure represents the initial investment of $10,000 plus the
cumulative amount of dividends reinvested. Dividends and other distributions
were assumed to have been reinvested in additional participations at the
reinvestment price. The value of participations "Initially Acquired" includes
the value of additional participations created as a result of the reinvestment
of that portion of the semi-annual distributions representing "A Return of
Capital" (the proceeds from securities sold representing the cost of
securities sold, and other principal transactions). No adjustment has been
made for any income taxes payable by Holders on dividends or other
distributions reinvested in additional participations.
The dollar amounts of distributions from realized gains (determined at the
Trust level) reinvested in additional participations were: 1941--None; 1942--
None; 1943--None; 1944--$3; 1945--$450; 1946--None; 1947--$44; 1948--$338;
1949--None; 1950--$283; 1951--$796; 1952--$185; 1953--$10; 1954--$812; 1955--
$474; 1956--$4,347; 1957--$48; 1958--$17; 1959--$3,032; 1960--$2,371; 1961--
$2,118; 1962--$2,749; 1963--$735; 1964--$3,138; 1965--$9,035; 1966--$1,077;
1967--$48; 1968--$4,121; 1969--$102; 1970--$644; 1971--$1,862; 1972--$2,300;
1973--None; 1974--None; 1975--None; 1976--$5,071; 1977--$4,161; 1978--None;
1979--None; 1980--$5,182; 1981--$31,473; 1982--None; 1983--$18,602; 1984--
$8,258; 1985--$39,496; 1986--$64,138; 1987--$69,182; 1988--$49,350; 1989--
$99,410; 1990--$148,727; 1991--$39,773; 1992--$52,819; 1993--$46,262; 1994--
$160,296; 1995--$7,696; 1996--$62,612; 1997--$664,104; 1998--$83,389; 1999--
$51,130; Total--$1,752,270.
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE OF PARTICIPATIONS
-------------------------------------------------------------
Cumulative
Cost of
Amount of Participations Cumulative Purchased Through Purchased
Dividends Purchased Cost Reinvestment of Through
Reinvested Through Including Distributions from Reinvestment
Year Ended Semi- Reinvestment Reinvested Initially Realized Gains of Dividends Net Asset Number of
Dec. 31 Annually of Dividends Dividends Acquired (Cumulative) Sub-Total (Cumulative) Value Participations
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1941* -- -- $ 10,000 $ 8,799 -- $ 8,799 -- $ 8,799 566
1942 -- -- 10,000 9,613 -- 9,613 -- 9,613 584
1943 $ 190 $ 190 10,190 10,809 -- 10,809 $ 188 10,997 601
1944 192 382 10,382 11,983 $ 3 11,986 402 12,388 620
1945 215 597 10,597 14,709 464 15,173 682 15,855 693
1946 187 784 10,784 13,961 430 14,391 816 15,207 716
1947 370 1,154 11,154 14,639 447 15,086 1,141 16,227 824
1948 513 1,668 11,668 14,840 718 15,558 1,480 17,038 989
1949 509 2,177 12,177 17,113 701 17,814 1,968 19,782 1,176
1950 804 2,980 12,980 19,871 994 20,865 2,779 23,644 1,392
1951 1,012 3,992 13,992 21,659 1,756 23,415 3,674 27,089 1,652
1952 1,054 5,046 15,046 24,356 2,016 26,372 4,901 31,273 1,845
1953 1,217 6,263 16,263 24,849 2,030 26,879 6,149 33,028 1,945
1954 1,378 7,641 17,641 33,779 3,476 37,255 9,475 46,730 2,117
1955 1,599 9,240 19,240 39,164 4,398 43,562 12,349 55,911 2,243
1956 1,790 11,030 21,030 38,511 7,051 45,562 10,475 56,037 3,123
1957 1,910 12,940 22,940 36,268 6,574 42,842 11,496 54,338 3,269
1958 2,134 15,075 25,075 48,925 8,778 57,703 17,710 75,413 3,406
1959 2,184 17,258 27,258 55,426 11,821 67,247 19,992 87,239 3,906
1960 2,416 19,674 29,674 55,782 12,653 68,435 19,772 88,207 4,562
1961 2,697 22,371 32,371 67,126 16,993 84,119 25,757 109,876 4,881
1962 2,926 25,296 35,296 62,396 17,033 79,429 24,446 103,875 5,541
1963 3,243 28,540 38,540 71,467 19,863 91,330 30,711 122,041 5,803
1964 3,553 32,093 42,093 83,001 24,049 107,050 35,865 142,915 6,452
1965 3,855 35,948 45,948 92,523 30,246 122,769 35,623 158,392 8,066
1966 4,571 40,519 50,519 74,713 24,491 99,204 31,774 130,978 8,606
1967 5,060 45,579 55,579 83,121 27,090 110,211 40,165 150,376 8,948
1968 5,573 51,153 61,153 89,160 32,157 121,317 46,879 168,196 9,710
1969 5,915 57,068 67,068 75,017 26,979 101,996 44,536 146,532 10,115
1970 6,009 63,077 73,077 82,621 28,564 111,185 52,500 163,685 10,957
1971 6,190 69,267 79,267 93,454 32,126 125,580 61,694 187,274 11,856
1972 6,585 75,852 85,852 108,913 38,484 147,397 75,949 223,346 12,605
1973 7,371 83,223 93,223 93,151 32,729 125,880 71,868 197,748 13,123
1974 8,196 91,419 101,419 68,448 22,864 91,312 57,376 148,688 14,124
1975 9,139 100,557 110,557 91,498 30,474 121,972 85,413 207,385 14,781
1976 9,666 110,223 120,223 115,461 37,963 153,424 101,306 254,730 16,914
1977 11,237 121,460 131,460 108,466 35,919 144,385 96,397 240,782 18,898
1978 13,283 134,743 144,743 110,210 34,687 144,897 105,738 250,635 20,370
1979 15,804 150,547 160,547 139,110 34,774 173,884 121,307 295,191 23,931
1980 19,369 169,916 179,916 173,026 47,488 220,514 165,362 385,876 26,181
1981 21,822 191,738 201,738 163,070 62,645 225,715 140,698 366,413 33,836
1982 24,452 216,190 226,190 191,554 69,992 261,546 183,359 444,905 36,772
1983 25,923 242,114 252,114 235,913 91,870 327,783 218,649 546,432 42,757
1984 28,926 271,040 281,040 250,855 91,476 342,331 226,566 568,897 49,375
1985 31,808 302,848 312,848 333,623 145,913 479,536 293,217 772,753 58,251
1986 39,216 342,064 352,064 408,170 212,840 621,010 342,608 963,618 69,711
1987 40,394 382,458 392,458 412,599 241,185 653,784 326,728 980,512 83,847
1988 71,268 453,726 463,726 470,438 297,425 767,863 407,155 1,175,018 97,918
1989 45,103 498,829 508,829 583,494 438,476 1,021,970 509,512 1,531,482 111,950
1990 51,303 550,132 560,132 552,346 473,992 1,026,338 440,810 1,467,148 139,330
1991 55,828 605,960 615,960 654,372 558,392 1,212,764 539,190 1,751,954 152,079
1992 55,460 661,420 671,420 700,391 619,341 1,319,732 600,946 1,920,678 165,291
1993 54,505 715,925 725,925 814,945 727,611 1,542,556 715,658 2,258,214 176,699
1994 60,332 776,257 786,257 832,095 759,684 1,591,779 649,069 2,240,848 213,211
1995 61,329 837,586 847,586 1,207,794 998,228 2,206,022 913,513 3,119,535 227,040
1996 64,546 902,132 912,132 1,452,214 1,232,426 2,684,640 1,134,598 3,819,238 237,959
1997 71,379 973,511 983,511 1,794,519 1,785,369 3,579,888 1,121,302 4,701,190 315,940
1998 72,385 1,045,896 1,055,896 1,948,610 1,965,327 3,913,937 1,254,684 5,168,621 329,211
1999 78,614 1,124,210 1,134,210 2,198,244 2,216,745 4,414,989 1,460,590 5,875,579 339,629
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
* From March 16, 1941.
Note--During 1990 all sales charges were eliminated. The above table reflects
the change to a "no load" status as if it were in effect for the entire period
shown. The amounts shown as dividends for periods after October 31, 1988
include interest income from the investment of amounts deposited in the
distributive fund.
17
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Participation Holders of Lexington Corporate Leaders Trust Fund
In our opinion, the accompanying statement of assets and liabilities,
including the statement of investments, and the related statements of
operations and of changes in net assets and the selected financial information
present fairly, in all material respects, the financial position of Lexington
Corporate Leaders Trust Fund (the "Trust") at December 31, 1999, and the
results of its operations, the changes in its net assets and the selected
financial information for the year then ended, in conformity with accounting
principles generally accepted in the United States. These financial statements
and selected financial information (hereafter referred to as "financial
statements") are the responsibility of the Trust's management; our
responsibility is to express an opinion on these financial statements based on
our audit. We conducted our audit of these financial statements in accordance
with auditing standards generally accepted in the United States which 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, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audit, which included
confirmation of securities at December 31, 1999 by correspondence with the
custodian, provides a reasonable basis for the opinion expressed above. The
financial statements for the year ended December 31, 1998, including the
selected financial information for each of the four years in the period then
ended, were audited by other independent accountants whose report dated
January 7, 1999 expressed an unqualified opinion on those financial
statements.
PricewaterhouseCoopers LLP
New York, New York
January 7, 2000
18
<PAGE>
LEXINGTON CORPORATE LEADERS TRUST FUND
STATEMENT OF ASSETS AND LIABILITIES December 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Assets
Investments at market quotations, common stocks (identified cost
$330,146,215)................................................... $453,006,994
Cash............................................................. 12,283,354
Subscriptions receivable......................................... 379,148
Receivable for accrued dividends................................. 671,212
------------
Total assets................................................. 466,340,708
------------
Liabilities
Distribution payable............................................. 1,513,906
Payable for participations redeemed.............................. 672,824
Accrued expenses................................................. 158,543
------------
Total liabilities............................................ 2,345,273
------------
Net Assets
Balance applicable to 26,818,793 participations outstanding (Note
6).............................................................. $463,995,435
============
Computation of public offering price:
Net asset value, offering and redemption price per participation
(net assets divided by participations outstanding)............. $17.30
======
</TABLE>
The accompanying notes form an integral part of these financial statements.
19
<PAGE>
LEXINGTON CORPORATE LEADERS TRUST FUND
STATEMENT OF OPERATIONS Year Ended December 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Investment income:
Income:
Dividends (net of $63,737 tax expense)........................... $ 9,452,773
Interest......................................................... 63,255
-----------
Total income.................................................... 9,516,028
-----------
Expenses:
Sponsor's administrative fee (Note 4)............................. 1,887,832
Professional fees................................................. 72,960
Trustee's fee (Note 4)............................................ 9,167
Custody fees and other services (Note 4).......................... 136,368
Transfer agent fees............................................... 588,831
Printing, mailing and sundry...................................... 138,730
Registration and filing fees...................................... 25,627
-----------
Total expenses.................................................. 2,859,515
-----------
Net investment income.......................................... 6,656,513
-----------
Realized and unrealized gain on investments:
Net realized gain from securities transactions.................... 36,101,224
Unrealized appreciation of investments for the period............. 16,587,948
-----------
Net gain on investments........................................ 52,689,172
-----------
Net increase in net assets from operations........................ $59,345,685
===========
</TABLE>
The accompanying notes form an integral part of these financial statements.
20
<PAGE>
LEXINGTON CORPORATE LEADERS TRUST FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended Year Ended
December 31, December 31,
1999 1998
------------ ------------
<S> <C> <C>
Income and Distributable Fund:
Additions:
Net investment income........................... $ 6,656,513 $ 7,463,661
Realized gains from sale of securities, other
than sale of stock units........................ 4,133,398 8,884,899
------------ ------------
10,789,911 16,348,560
------------ ------------
Deductions:
Paid on account of participations redeemed...... 414,733 648,862
Semi-annual distributions (Note 3(a))
Paid in cash.................................. 1,392,270 1,783,831
Reinvested, below............................. 9,067,257 13,985,638
------------ ------------
10,874,260 16,418,331
------------ ------------
Net change in income and distributable fund...... (84,349) (69,771)
------------ ------------
Principal Account:
Additions:
Payments received on sale of participations..... 40,626,909 73,930,270
Semi-annual distributions reinvested, above..... 9,067,257 13,985,638
Realized gains on sale of stock units........... 31,967,826 45,931,415
Unrealized appreciation (depreciation) of
investments.................................... 16,587,948 (13,378,650)
------------ ------------
98,249,940 120,468,673
------------ ------------
Deductions:
Paid on account of participations redeemed...... 118,815,387 160,221,771
Semi-annual distributions of principal (Note
3(b)).......................................... 549,286 651,211
------------ ------------
119,364,673 160,872,982
------------ ------------
Net change in principal account................. (21,114,733) (40,404,309)
------------ ------------
Net assets at beginning of period:
Income and distributable fund.................... 597,016 666,787
Principal account................................ 484,597,501 525,001,810
------------ ------------
485,194,517 525,668,597
------------ ------------
Net assets at end of period:
Income and distributable fund.................... 512,667 597,016
Principal account................................ 463,482,768 484,597,501
------------ ------------
$463,995,435 $485,194,517
============ ============
</TABLE>
The accompanying notes form an integral part of these financial statements.
21
<PAGE>
LEXINGTON CORPORATE LEADERS TRUST FUND
STATEMENT OF INVESTMENTS December 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number of Market
Shares Cost Value
Securities --------- ------------ ------------
- ---------------------------------------
<S> <C> <C> <C>
Consumer Products: (14.7%)
Eastman Kodak Co. ......................... 297,200 $ 20,999,070 $ 19,689,500
Fortune Brands, Inc. ...................... 297,200 9,446,426 9,826,175
Gallaher Group PLC......................... 297,200 5,327,727 4,569,450
Procter & Gamble Co. ...................... 297,200 20,285,477 32,561,975
------------ ------------
56,058,700 66,647,100
------------ ------------
Oil International: (16.3%)
Chevron Corp. ............................. 297,200 19,239,757 25,744,950
Exxon Mobil Corp. ......................... 599,100 31,559,754 48,264,994
------------ ------------
50,799,511 74,009,944
------------ ------------
Chemical & Fertilizers: (8.7%)
DuPont (E.I.) de Nemours & Co., Inc. ...... 297,200 15,954,096 19,578,050
Union Carbide Corp. ....................... 297,200 12,807,570 19,838,100
------------ ------------
28,761,666 39,416,150
------------ ------------
Electrical Equipment: (10.2%)
General Electric Co. ...................... 297,200 17,014,730 45,991,700
------------ ------------
Broadcasting: (4.2%)
CBS Corp.*................................. 297,200 6,279,220 19,002,225
------------ ------------
Retailing: (2.5%)
Sears, Roebuck & Co. ...................... 297,200 13,606,042 9,046,025
Venator Group, Inc.*....................... 297,200 5,770,338 2,080,400
------------ ------------
19,376,380 11,126,425
------------ ------------
Utilities: (5.8%)
Ameren Corp. .............................. 297,200 11,629,982 9,733,300
Consolidated Edison, Inc. ................. 297,200 9,624,012 10,253,400
Pacific Gas & Electric Co. ................ 297,200 7,755,463 6,092,600
------------ ------------
29,009,457 26,079,300
------------ ------------
Railroads: (6.5%)
Burlington Northern Santa Fe............... 684,942 20,203,666 16,609,843
Union Pacific Corp. ....................... 297,200 16,311,167 12,965,350
------------ ------------
36,514,833 29,575,193
------------ ------------
Energy: (9.1%)
Columbia Energy Group...................... 485,450 17,467,431 30,704,713
Union Pacific Resources Group, Inc. ....... 255,967 6,445,217 3,263,579
USX Marathon Group......................... 297,200 7,600,814 7,337,125
------------ ------------
31,513,462 41,305,417
------------ ------------
Misc. Industrial: (7.1%)
Honeywell International Corp. ............. 297,200 11,771,100 17,144,725
Praxair, Inc. ............................. 297,200 12,575,032 14,952,875
------------ ------------
24,346,132 32,097,600
------------ ------------
Communications: (9.4%)
AT&T Corp. ................................ 456,100 12,923,760 23,147,075
Lucent Technologies, Inc. ................. 259,020 6,016,973 19,377,934
------------ ------------
18,940,733 42,525,009
------------ ------------
Financial: (5.5%)
CitiGroup, Inc. ........................... 454,100 11,531,391 25,230,931
------------ ------------
Total Investments (100%)............... $330,146,215 $453,006,994
============ ============
</TABLE>
*Non Income producing
The accompanying notes form an integral part of these financial statements.
22
<PAGE>
LEXINGTON CORPORATE LEADERS TRUST FUND
NOTES TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------------
Note 1. Nature of Business and Basis of Presentation
Lexington Corporate Leaders Trust Fund (the "Trust") is an unincorporated
Unit Investment Trust registered as such with the Securities and Exchange
Commission. The Trust commenced operations in 1941 as a series of Corporate
Leaders Trust Fund which was created under a Trust Indenture dated November
18, 1935.
Note 2. Significant Accounting Policies
The following is a summary of significant accounting policies followed by
the Trust in the preparation of its financial statements:
(a) Valuation of securities--Investments are stated at value based on the
last sale price on the principal exchange on which the security is traded
prior to the time the Trust's assets are valued. Investments for which no
sale is reported, or which are traded over-the-counter, are valued at the
mean between bid and asked prices. Short term securities with 60 days or
less to maturity are valued at amortized cost.
(b) Income taxes--No provision for Federal income taxes is made since the
Trust, under applicable provisions of the Internal Revenue Code, is a
Grantor Trust and all its income is taxable to the Holders of
participations.
(c) Other--Investment transactions are recorded on the trade date basis.
Dividend income is recorded on the ex-dividend date. Interest income is
accrued as earned.
(d) Accounting estimates--The preparation of financial statements in
accordance with accounting principles generally accepted in the United
States requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities at the date of the financial
statements and the amounts of income and expense during the reporting
period. Actual results could differ from those estimates.
Note 3. Distributions
(a) During the year ended December 31, 1999 the distributions from net
investment income were $0.23796 per participation and, from realized gains
were $0.15424 per participation.
(b) The amount shown does not reflect the reinvestment, if any, of that
portion from the sale of securities (other than stock units) representing the
cost of the securities sold which is distributed and then reinvested in
additional participations. In addition, any gain on the sale of stock units to
provide funds for the redemption of participations is non-distributable and
remains a part of the principal account. During the year ended December 31,
1999, the distributions from return of capital were $0.15409 per
participation.
Effective June 1, 1998 the Trust amended its Trust indenture requiring that
additional shares of common stock received as a result of a stock split shall
remain assets of the Trust.
Note 4. Trustee and Sponsor Fees
State Street Bank and Trust Company (the "Trustee") receives an annual
Trustee fee, as well as fees for acting as custodian and for providing
portfolio accounting and record keeping services, which aggregated
23
<PAGE>
LEXINGTON CORPORATE LEADERS TRUST FUND
NOTES TO FINANCIAL STATEMENTS (Continued)
- -------------------------------------------------------------------------------
$145,535 for the year ended December 31, 1999. The Trust pays an
administrative fee to Lexington Management Corporation (Sponsor) equal, on an
annual basis, to 0.40% of the average daily net assets of the Trust.
Note 5. Investment Transactions
During the year ended December 31, 1999, the proceeds of sales of investment
securities, other than short-term obligations, were $81,987,609. There were no
purchases of securities during the period.
The cost of investment securities as well as realized security gains and
losses are based on the identified cost basis. The cost of investments for
Federal income taxes is the same as that reported in the Trust's financial
statements.
As of December 31, 1999, net unrealized appreciation of portfolio securities
was $122,860,779, comprised of unrealized appreciation of $147,123,093 and
unrealized depreciation of $24,262,314.
Note 6. Source of Net Assets
As of December 31, 1999, the Trust's net assets were comprised of the
following amounts:
<TABLE>
<S> <C>
Net amounts paid in and reinvested by holders net of
terminations and return of capital payments................. $205,938,872
Cumulative amount of non-distributable realized gains
retained in principal account............................... 134,683,117
Unrealized appreciation in value of securities............... 122,860,779
------------
Principal account........................................... 463,482,768
Income and distributable fund............................... 512,667
------------
Total net assets........................................... $463,995,435
============
</TABLE>
Note 7. Participations Issued and Redeemed
During the periods indicated, participations were issued and redeemed as
follows:
<TABLE>
<CAPTION>
Number of Participations
-----------------------------------
Year Ended Year Ended
December 31, 1999 December 31, 1998
----------------- -----------------
<S> <C> <C>
Issued on payments from holders........ 2,391,797 4,778,866
Issued on reinvestment of dividends and
distributions......................... 724,515 1,198,055
Redeemed............................... (7,202,045) (10,403,573)
---------- -----------
Net (decrease)....................... (4,085,733) (4,426,652)
========== ===========
</TABLE>
24
<PAGE>
LEXINGTON CORPORATE LEADERS TRUST FUND
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
Note 8. Selected Financial Information
<TABLE>
<CAPTION>
Years Ended December 31,
------------------------------------------------
Selected Data Per Participation
outstanding throughout the
period: 1999 1998 1997 1996 1995
- ------------------------------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period........................ $15.70 $14.88 $16.05 $13.74 $10.51
------ ------ ------ ------ ------
Income from investment
operations:
Net investment income......... 0.24 0.23 0.27 0.28 0.28
Net realized and unrealized
gain (loss) on investments... 1.92 1.28 3.45 2.79 3.82
------ ------ ------ ------ ------
Total from investment
operations.................... 2.16 1.51 3.72 3.07 4.10
------ ------ ------ ------ ------
Less distributions:
Dividends from net investment
income....................... (0.24) (0.23) (0.28) (0.28) (0.28)
Distributions from net
realized gains............... (0.15) (0.26) (2.60) (0.28) (0.03)
Distributions from income and
realized gains included in
terminations................. (0.02) (0.02) (0.11) (0.02) (0.02)
Distributions from capital.... (0.15) (0.18) (1.90) (0.18) (0.54)
------- ------- ------- ------- -------
Total distributions.......... (0.56) (0.69) (4.89) (0.76) (0.87)
------- ------- ------- ------- -------
Change in net asset value for
the period.................... 1.60 0.82 (1.17) 2.31 3.23
------ ------ ------ ------ ------
Net asset value at end of
period........................ $17.30 $15.70 $14.88 $16.05 $13.74
====== ====== ====== ====== ======
Total return................. 13.68% 9.94% 23.09% 22.43% 39.21%
Ratios/supplemental data:
Net assets, end of period
(000)......................... $463,995 $485,195 $525,669 $392,295 $256,467
Ratios to average net asset of:
Expenses...................... 0.61% 0.65% 0.62% 0.63% 0.58%
Net investment income......... 1.41% 1.46% 1.76% 2.05% 2.57%
</TABLE>
25
<PAGE>
LEXINGTON CORPORATE LEADERS TRUST FUND
<TABLE>
<S> <C> <C>
Sponsor All Shareholder requests for services LEXLINE 800-526-0052
Lexington Management Corporation of any kind should be sent to:
Park 80 West Plaza Two 24-hour toll-free telephone access to
Saddle Brook, New Jersey 07663 Transfer Agent your Lexington Fund account(s)
State Street Bank and Trust Company where you can obtain the following:
Distributor c/o National Financial Data Services
Lexington Funds Distributor, Inc. 330 West Ninth Street - Price/Yield
Park 80 West Plaza Two Kansas City, Missouri 64105 - Account Balances
Saddle Brook, New Jersey 07663 - Exchanges
Or call toll free Service and Sales: - Last Transactions
Trustee 1-800-526-0056 - Total Return
State Street Bank and - Duplicate Statements
Trust Company
225 Franklin Street www.lexingtonfunds.com
Boston, Massachusetts 02110
</TABLE>
<PAGE>
PART II
ADDITIONAL INFORMATION NOT INCLUDED
IN THE PROSPECTUS
Undertaking to File Reports
Subject to the terms and conditions of Section 15(d) of the
Securities Exchange Act of 1934, the undersigned Registrant
hereby undertakes to file with the Securities and Exchange
Commission such supplementary and periodic information, documents
and reports as may be prescribed by any rule or regulation of the
Commission heretofore or hereafter duly adopted pursuant to
authority conferred in that section.
Contents of Registration Statement
This Registration Statement on Form S-6 is comprised of the
following papers and documents:
The facing sheet.
The Prospectus consisting of 25 pages.
Additional information not included in the Prospectus (Part II).
The undertaking to file reports.
The signatures.
The following exhibits:
Consent of Counsel to the use of its name under the heading "Legal
Opinion" in the Prospectus.
Consent of Certified Public Accountants.
(The Annual Report for the year ending December 31, 1998 was filed
electronically on March 1, 1999 (as form type N-30D). Financial
statements from this 1998 Annual Report have been included in the
Prospectus)
<PAGE>
Registration No. 2-10694
___________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________
Exhibits
File With
Form S-6
___________________________
LEXINGTON CORPORATE LEADERS TRUST FUND
___________________________________________________________________________
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EXHIBIT INDEX
The following documents are being filed electronically as exhibits to this
filing:
Consent of Kramer Levin Naftalis & Frankel LLP
Consent of Certified Public Accountants - PricewaterhouseCoopers LLP
Consent of Certified Public Accountants -
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940 the Registrant certifies that it has met
all of the requirements for effectiveness of this amendments to the
Registration Statement pursuant to Rule 485(b) under the Securities Act
of 1933 and has duly caused this Amendment to be signed on its behalf by
the Undersigned, thereunto duly authorized, in the City of Saddle Brook
and State of New Jersey, on the 28th day of April, 2000.
LEXINGTON CORPORATE LEADERS TRUST FUND
/s/ Richard M. Hisey
________________________________
Richard M. Hisey
Executive Vice President, CFO
Managing Director and Director
Lexington Management Corporation
Kramer, Levin, Naftalis & Frankel
9 1 9 T H I R D A V E N U E
NEW YORK, N.Y. 10022 3852
(212) 715 9100
FAX
(212) 715-8000
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WRITER'S DIRECT
NUMBER
(212) 715-9100
April 25, 2000
Lexington Corporate Leaders Trust Fund
Park 80 West Plaza Two
Saddle Brook, New Jersey 07663
Re: Lexington Corporate Leaders Trust Fund
File No. 2-10694; 811-0091
Registration Statement on Form S-6
Dear Ladies and Gentlemen:
We hereby consent to the reference to our firm as Counsel in Post-
Effective Amendment No. 39 to the Registration Statement on Form S-6 filed
under Rule 485(b) of the Securities Act of 1933.
Very truly yours,
/s/ Kramer, Levin, Naftalis & Frankel LLP
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York NY 10036
Telephone (212) 596 8000
Facsimile (212) 596 8910
CONSENT OF INDEPENDENT AUDITORS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-6 of our report dated January 7, 2000, relating to the
financial statements and financial highlights which appear in the December 31,
1999 annual report to shareholders which is also incorporated by reference
into the Registration Statement. We also consent to the references to us under
the headings "Financial Highlights" and "Auditors" in such Registration
Statement.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
New York, New York
April 26, 2000
CONSENT OF INDEPENDENT AUDITORS
We hereby consent to the use of our Report dated January 7, 1999 on the 1998
financial statements of Lexington Corporate Leaders Trust Fund in
Post-Effective Amendment No. 39 to the Registration Statement on Form S-6 as
filed with the Securities and Exchange Commission.
McGladrey & Pullen, LLP
New York, New York
April 26, 2000
