<PAGE>
FILED PURSUANT TO RULE NO. 424(b)(1)
REGISTRATION NO. 333-36480
PROSPECTUS
[HOLDRS LOGO]
1,000,000,000 Depositary Receipts
Regional Bank HOLDRS SM Trust
The Regional Bank HOLDRS SM Trust will issue Depositary Receipts called
Regional Bank HOLDRS SM representing your undivided beneficial ownership in
the U.S.-traded common stock of a group of specified companies that are
involved in various segments of the regional banking industry. The Bank of New
York will be the trustee. You only may acquire, hold or transfer Regional Bank
HOLDRS in a round-lot amount of 100 Regional Bank HOLDRS or round-lot
multiples. Regional Bank HOLDRS are separate from the underlying deposited
common stocks that are represented by the Regional Bank HOLDRS. For a list of
the names and the number of shares of the companies that make up a Regional
Bank HOLDR, see "Highlights of Regional Bank HOLDRS--The Regional Bank HOLDRS"
starting on page 10. Merrill Lynch, Pierce, Fenner & Smith Incorporated has
sold 1,440,000 Regional Bank HOLDRS in the initial distribution. The trust
will issue the additional Regional Bank HOLDRS on a continuous basis.
Investing in Regional Bank HOLDRS involves significant risks. See "Risk
factors" starting on page 4.
The initial public offering price for a round-lot of 100 Regional Bank
HOLDRS will equal the sum of the closing market price on the primary trading
market on June 22, 2000, the pricing date, for each deposited share multiplied
by the share amount specified in this prospectus, plus an underwriting fee.
Regional Bank HOLDRS are neither interests in nor obligations of either
the initial depositor, Merrill Lynch, Pierce, Fenner & Smith Incorporated, or
The Bank of New York, as trustee.
Before this issuance, there has been no public market for Regional Bank
HOLDRS. The Regional Bank HOLDRS have been approved for listing on the
American Stock Exchange under the symbol "RKH", subject to official notice of
issuance.
---------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
<TABLE>
<CAPTION>
Initial Price Underwriting
to Public* Fee
------------- ------------
<S> <C> <C>
Per Regional Bank HOLDR......................... $98.14 2%
</TABLE>
--------
* Includes underwriting fee.
---------------
Merrill Lynch & Co. A.G. Edwards & Sons, Inc.
---------------
The date of this prospectus is June 22, 2000.
"HOLDRS" and "HOLding Company Depositary ReceiptS" are service marks of
Merrill Lynch & Co., Inc.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Summary.................................................................... 3
Risk Factors............................................................... 4
Highlights of Regional Bank HOLDRS......................................... 9
The Trust.................................................................. 15
Description of Regional Bank HOLDRS........................................ 15
Description of the Underlying Securities................................... 16
Description of the Depositary Trust Agreement.............................. 18
Federal Income Tax Consequences............................................ 21
ERISA Considerations....................................................... 22
Plan of Distribution....................................................... 22
Legal Matters.............................................................. 23
Where You Can Find More Information........................................ 23
</TABLE>
---------------
This prospectus contains information you should consider when making your
investment decision. With respect to information about Regional Bank HOLDRS,
you should rely only on the information contained in this prospectus. We have
not authorized any other person to provide you with different information. If
anyone provides you with different or inconsistent information, you should not
rely on it. We are not making an offer to sell Regional Bank HOLDRS in any
jurisdiction where the offer or sale is not permitted.
The Regional Bank HOLDRS are not registered for public sale outside of
the United States. Non-U.S. receipt holders should consult their tax advisors
regarding U.S. withholding and other taxes which may apply to ownership of the
Regional Bank HOLDRS or of the underlying securities through an investment in
the Regional Bank HOLDRS.
2
<PAGE>
SUMMARY
The Regional Bank HOLDRS Trust will be formed under the depositary trust
agreement, dated as of May 18, 2000, as amended and restated on June 21, 2000,
among The Bank of New York, as trustee, Merrill Lynch, Pierce, Fenner & Smith
Incorporated, other depositors and the owners of the Regional Bank HOLDRS. The
trust is not a registered investment company under the Investment Company Act
of 1940.
The trust will hold shares of common stock issued by 20 specified
companies generally considered to be involved in various segments of the
regional banking industry. The Bank of New York Company, Inc., as the parent
company of the trustee, is not one of the companies included in the Regional
Bank HOLDRS. The number of shares of each common stock held by the trust with
respect to each round-lot of Regional Bank HOLDRS is specified under
"Highlights of Regional Bank HOLDRS--The Regional Bank HOLDRS." This group of
common stocks is referred to as the underlying securities. Except when a
reconstitution event occurs, the underlying securities will not change.
Under no circumstances will a new company be added to the group of
issuers of underlying securities.
The trust will issue Regional Bank HOLDRS that represent your undivided
beneficial ownership interest in the shares of common stock held by the trust
on your behalf. The Regional Bank HOLDRS are separate from the underlying
common stocks that are represented by the Regional Bank HOLDRS.
3
<PAGE>
RISK FACTORS
An investment in Regional Bank HOLDRS involves risks similar to investing
in each of the underlying securities outside of the Regional Bank HOLDRS,
including the risks associated with concentrated investments in regional banks.
General Risk Factors
. Loss of investment. Because the value of Regional Bank HOLDRS
directly relates to the value of the underlying securities, you
may lose all or a substantial portion of your investment in the
Regional Bank HOLDRS if the underlying securities decline in
value.
. Discount trading price. Regional Bank HOLDRS may trade at a
discount to the aggregate value of the underlying securities.
. Not necessarily representative of the regional banking
industry. While the underlying securities are common stocks of
companies generally considered to be involved in various aspects
of the regional banking industry, the underlying securities and
the Regional Bank HOLDRS may not necessarily follow the price
movements of the entire banking industry generally. If the
underlying securities decline in value, your investment in the
Regional Bank HOLDRS will decline in value even if common stock
prices of companies involved in the regional banking industry
generally increase in value. Furthermore, after the initial
deposit, one or more of the issuers of the underlying securities
may no longer be involved in the regional banking industry. In
this case, the Regional Bank HOLDRS may no longer consist of
securities issued only by companies involved in the regional
banking industry.
. No investigation of underlying securities. The underlying
securities included in the Regional Bank HOLDRS were selected by
Merrill Lynch, Pierce, Fenner & Smith Incorporated based on the
market capitalization of issuers and the market liquidity of
common stocks in the regional banking industry, without regard for
the value, price performance, volatility or investment merit of
the underlying securities. Consequently, the Regional Bank HOLDRS
Trust, the trustee, Merrill Lynch, Pierce, Fenner & Smith
Incorporated, and their affiliates, have not performed any
investigation or review of the selected companies, including the
public filings by the companies. Investors and market participants
should not conclude that the inclusion of a company is any form of
investment recommendation by the trust, the trustee, Merrill
Lynch, Pierce, Fenner & Smith Incorporated, or their affiliates.
. Loss of diversification. As a result of industry developments,
reorganizations, or market fluctuations affecting issuers of the
underlying securities, Regional Bank HOLDRS may not necessarily
continue to be a diversified investment in the regional banking
industry. As a result of market fluctuation and/or reconstitution
events, Regional Bank HOLDRS may represent a concentrated
investment in one or more of the underlying securities which would
reduce investment diversification and increase your exposure to
the risks of concentrated investments.
. Conflicting investment choices. In order to sell one or more of
the underlying securities individually or to participate in a
tender offer relating to one or more of the underlying securities,
you will be required to cancel your Regional Bank HOLDRS and
receive delivery of each of the underlying securities. The
cancellation of your Regional Bank HOLDRS will allow you to sell
individual underlying securities or to deliver individual
underlying securities in a tender offer. The cancellation of
Regional Bank HOLDRS will involve payment of a cancellation fee to
the trustee.
4
<PAGE>
. Trading halts. Trading in Regional Bank HOLDRS may be halted if
trading in one or more of the underlying securities is halted. If
so, you will not be able to trade Regional Bank HOLDRS even though
there is trading in some of the underlying securities; however,
you will be able to cancel your Regional Bank HOLDRS to receive
the underlying securities.
. Delisting from the American Stock Exchange. If the number of
companies whose common stock is held in the trust falls below
nine, the American Stock Exchange may consider delisting the
Regional Bank HOLDRS. If the Regional Bank HOLDRS are delisted by
the American Stock Exchange, a termination event will result
unless the Regional Bank HOLDRS are listed for trading on another
national securities exchange or through NASDAQ within five
business days from the date the Regional Bank HOLDRS are delisted.
. Possible conflicts of interest. Merrill Lynch, Pierce, Fenner &
Smith Incorporated, as initial depositor, has selected the
underlying securities and may face possible conflicts of interest
in connection with its activities. For example, Merrill Lynch,
Pierce, Fenner & Smith Incorporated and its affiliates,
collectively referred to as Merrill Lynch, may engage in
investment banking and other activities, may provide services to
issuers of the underlying securities in connection with its
business, or may make purchases or sales, including establishing
long or short positions, in the underlying securities for its own
account. In addition, Merrill Lynch, Pierce, Fenner & Smith
Incorporated, as initial depositor, will purchase, in the
secondary market, the underlying securities that will be deposited
into the trust. Merrill Lynch may make these purchases before the
deposit into the trust, or it may borrow securities for the
deposit and subsequently purchase the securities to repay to the
lenders the securities previously borrowed. In either event, the
purchases of the underlying securities will be made at various
prices. As the initial offering price for the Regional Bank HOLDRS
will be based on the closing market price of each of the
underlying securities on the pricing date, Merrill Lynch may
recognize a gain on its purchases of the underlying securities.
Specifically, if the closing market price for the underlying
securities on the pricing date is higher than the price at which
Merrill Lynch, Pierce, Fenner & Smith Incorporated, as initial
depositor, purchases the underlying securities then it will
recognize a gain in connection with such purchases. Merrill Lynch
may recognize this gain on any of the underlying securities that
comprise the Regional Bank HOLDRS or on all of the underlying
securities in the aggregate. The potential profit of Merrill Lynch
also is affected by any hedging activities that it may engage in
while it purchases the underlying securities in the secondary
market for deposit into the trust. All of these activities may
result in conflicts of interest with respect to the financial
interest of Merrill Lynch, on the one hand, and, on the other
hand, the initial selection of the underlying securities included
in the Regional Bank HOLDRS, the selection of the regional banking
industry, Merrill Lynch's activity in the secondary market in the
underlying securities, and the creation and cancellation of
Regional Bank HOLDRS by Merrill Lynch.
. Temporary price increases in the underlying securities. Purchasing
activity in the secondary trading market associated with acquiring
the underlying securities for deposit into the trust may
temporarily increase the market price of the deposited shares,
which will result in a higher initial offering price for the
Regional Bank HOLDRS. Large volumes of purchasing activity, which
may occur in connection with the issuance of Regional Bank HOLDRS,
particularly in connection with the initial issuance of Regional
Bank HOLDRS, could temporarily increase the market price of the
underlying securities, resulting in a higher price on that date.
This purchasing activity could create a temporary imbalance
between the supply and demand of the underlying securities,
thereby limiting the liquidity of the underlying securities due to
a temporary increased demand for underlying securities. Temporary
increases in the market price of the underlying securities may
also occur as a result of the purchasing activity of other market
participants. Other market participants may attempt to benefit
from increases in the market price of the underlying securities
that may occur as a
5
<PAGE>
result of the increased purchasing activity in the underlying
securities resulting from the issuance of the Regional Bank
HOLDRS. Consequently, prices for the underlying securities may
decline immediately after the pricing date. If the trading prices
for the underlying securities decline, the trading price of
Regional Bank HOLDRS will also decline.
Risk Factors Specific to Companies Involved in the Regional Bank Industry
. The banking industry is heavily regulated on the federal and state
levels, and modifications to existing banking laws and regulations
or the adoption of new laws may adversely affect the operations of
banking and financial institutions. There are numerous federal and
state laws with which banking and financial institutions must
comply. Adverse regulatory examinations and non-compliance with
regulatory requirements may result in sanctions by regulatory
agencies, additional regulatory restrictions and damage to the
reputation of a bank, its holding company and affiliates.
Additionally, government regulation of regional banking companies
is intended primarily for the protection of consumers, borrowers
and depositors of the banks, rather than of the stockholders of
the institutions. Changes to laws and regulations can affect
banks' operating environments in substantial and unpredictable
ways. Recent changes, including the Gramm-Leach-Bliley Act of 1999
which loosened regulatory restrictions on the securities and other
activities of banks and bank holding companies can be expected to
have a substantial impact on the U.S. banking industry and
individual banks. These changes may adversely affect the nature
and scope of banking and financial activities and may have a
negative effect on the financial condition and results of
operations of a bank or financial institution.
. Most regional banking companies are holding companies that rely on
dividends from their subsidiaries as a substantial portion of
their income and their rights generally are subordinate to the
interests of third parties. The payment of dividends by
subsidiaries of regional banks is subject to legal restriction. In
addition, the right of a parent bank holding company to
participate in any distribution of assets upon a subsidiaries'
liquidation or reorganization is subject to the prior claims of
the subsidiaries' creditors. The ability of a bank holding company
to receive dividends or other distributions is unpredictable, and
fluctuations in income may adversely affect your investment in the
Regional Bank HOLDRS.
. The ability to maintain or increase market share depends on market
acceptance of new products and services offered by regional banks.
There is increasing pressure in the banking industry for banks to
adapt to changing technologies. Regional banks must adapt services
to evolving industry standards and provide more cost efficient
services. The widespread adoption of new technologies, including
Internet-based services, is likely to require substantial
expenditures to modify or adapt the existing products and services
offered by many regional banks. In addition, new product research
and development may be costly and time-consuming. Many regional
banks may not successfully introduce new products, achieve general
market acceptance of their services or develop and maintain a
loyal customer base. Failure to do so could have a material
adverse effect on their business, results of operations and
financial condition.
. As a result of recent changes to the banking industry, some of the
companies involved in the regional banking industry are also
engaged in other lines of business unrelated to the regional
banking business, and they may experience problems with these
lines of business which could adversely affect their operating
results. Some of the companies which comprise the Regional Bank
HOLDRS have lines of business such as insurance, securities
brokerage and underwriting, real estate development and equity
investing that do not relate to traditional banking activities and
which may present additional risks not mentioned in this
prospectus. The operating results of these regional banks may
fluctuate as a result of these additional risks and events in the
other lines of business. In addition, a regional bank's ability
6
<PAGE>
to engage in new activities may expose it to business risks with
which it has less experience than it has with the business risks
associated with its traditional businesses. Despite a company's
possible success in traditional banking activities, there can be
no assurance that the other lines of business in which these
companies are engaged will not have an adverse effect on a
company's business or financial condition.
. The regional banking industry is very competitive, and a regional
banking company's failure to establish a customer base will
adversely affect its operating results. The competition among
regional banks to develop and maintain a customer base can be
intense. Customer loyalty can be easily influenced by a
competitor's new offerings, and pricing policies, especially those
offerings which provide cost savings. Many regional banks face
significant competition from other banks, financial institutions
and companies which have greater market share and financial
resources, including banks which operate on a national or
international level. These companies may be better positioned to
finance research and development activities, provide a wider range
of products and services over a greater geographic area and may
have greater resources with which to acquire other companies in
the industry. In addition, the Gramm-Leach-Bliley Act of 1999
broadens the scope of activities for regional banks meeting
certain criteria. Regional banks that meet this criteria, referred
to as "financial holding companies," may be able to offer a wider
range of products and services, perhaps at a more competitive
rate, and may realize a competitive advantage over other regional
banks.
. Inability to manage rapid growth could adversely affect systems,
management resources and revenues. Many regional banks are, or
plan to, rapidly expand their operations. The marketing and
expansion strategies of many of these regional banks has placed
and will continue to place a significant strain on the management,
financial controls, operations systems, personnel and other
resources. There can be no assurance that these companies will
complete the necessary improvements to their systems, procedures
and controls necessary to support their future operations in a
timely manner or that management will be able to hire, train,
retain and manage required personnel to manage such rapid growth.
. Failure to integrate acquisitions could disrupt operations and
prevent the realization of intended benefits. In recent years,
there has been substantial consolidation among companies in the
financial services industry. In particular, a number of large
commercial banks, insurance companies and other financial services
firms have established or acquired broker-dealers or have merged
with other financial institutions. Many of these firms have the
ability to offer a wide range of products, which may enhance their
competitive position and result in pricing pressure on traditional
banking businesses. The ability of a bank to successfully complete
an acquisition is subject to regulatory approval and there can be
no assurance that approval will be granted. Some regional banks
may have difficulty integrating acquired companies, which
frequently operate in different markets than the acquiring bank.
This may result in failure to realize expected cost savings,
increases in geographic presence, increases in revenue and other
projected benefits from such integration. Furthermore, regional
banks may suffer material adverse short and long-term effects on
operating results and financial condition as a result of such
acquisitions.
. The financial and international operations of many banks exposes
them to risks associated with instability and changes in economic
and political conditions, foreign currency fluctuations, changes
in foreign regulations and other risks inherent to international
business. Many banks regularly trade in foreign currencies, engage
in interest rate, foreign exchange and related derivative
transactions, and, to a lesser extent, acquire and trade in non-
U.S. securities. In addition, many regional banks have
international operations. The risks of international business that
the companies are exposed to include the following:
. general economic, social and political conditions;
7
<PAGE>
. the difficulty of enforcing intellectual property rights,
agreements and collecting receivables through certain foreign
legal systems;
. differing tax rates, tariffs, exchange controls or other
similar restrictions;
. volatility of currency markets and value of worldwide financial
markets;
. changes in, and compliance with, domestic and foreign laws and
regulations which impose a range of restrictions on operations,
trade practices, foreign trade and international investment
decisions.
. Regional bank stock prices may be volatile, which will directly
affect the price volatility of the Regional Bank HOLDRS, and you
could lose all or part of your investment. The trading prices of
the common stocks of regional banks can be volatile. Regional bank
stock prices could be subject to wide fluctuations in response to
a variety of factors, including the following:
. actual or anticipated variations in the banks' quarterly
operating results;
. announcements of technological innovations or new services by
regional banks or their competitors;
. announcements by regional banks or their competitors of
significant acquisitions, strategic partnerships, joint
ventures or capital commitments;
. failure to integrate or realize projected benefits from
acquisitions;
. changes in government regulations; and
. fluctuations in quarterly and annual operating results.
Other broad market and industry factors may decrease the stock
price of regional banks' stocks, regardless of their operating
results. Market fluctuations, as well as general political and
economic conditions, such as recession or interest rate or
currency rate fluctuations, also may decrease the market price of
regional banks' stocks.
. Many regional banks are dependent on their ability to continue to
attract and retain highly-skilled technical and managerial
personnel to develop and generate their business. Many regional
banks are highly dependent of the experience, abilities and
continued services of key executive officers and key technical
personnel. If these banks lose the services of any of these
officers or key technical personnel, their future success could be
undermined. Competition for personnel is intense. There is no
certainty that any of these regional banks will be able to
continue to attract and retain qualified personnel.
8
<PAGE>
HIGHLIGHTS OF REGIONAL BANK HOLDRS
This discussion highlights information regarding Regional Bank HOLDRS; we
present certain information more fully in the rest of this prospectus. You
should read the entire prospectus carefully before you purchase Regional Bank
HOLDRS.
Issuer...................... Regional Bank HOLDRS Trust.
The trust................... The Regional Bank HOLDRS Trust will be formed
under the depositary trust agreement, dated as
of May 18, 2000, as amended and restated on June
21, 2000, among The Bank of New York, as
trustee, Merrill Lynch, Pierce, Fenner & Smith
Incorporated, other depositors and the owners of
the Regional Bank HOLDRS. The trust is not a
registered investment company under the
Investment Company Act of 1940.
Initial depositor........... Merrill Lynch, Pierce, Fenner & Smith
Incorporated.
Trustee..................... The Bank of New York, a New York state-chartered
banking organization, will be the trustee and
receive compensation as set forth in the
depositary trust agreement.
Purpose of Regional Bank
HOLDRS..................... Regional Bank HOLDRS are designed to achieve the
following:
Diversification. Regional Bank HOLDRS are
designed to allow you to diversify your
investment in the regional banking industry
through a single, exchange-listed instrument
representing your undivided beneficial ownership
of the underlying securities.
Flexibility. The beneficial owners of Regional
Bank HOLDRS have undivided beneficial ownership
interests in each of the underlying securities
represented by the Regional Bank HOLDRS, and can
cancel their Regional Bank HOLDRS to receive
each of the underlying securities represented by
the Regional Bank HOLDRS.
Transaction costs. The expenses associated with
trading Regional Bank HOLDRS are expected to be
less than trading each of the underlying
securities separately.
Trust assets................ The trust will hold shares of common stock
issued by specified companies involved in the
regional banking industry. Except when a
reconstitution event occurs, the group of
companies will not change. Reconstitution events
are described in this prospectus under the
heading "Description of the depositary trust
agreement--Reconstitution events." Under no
circumstances will the common stock of a new
company be added to the common stocks underlying
the Regional Bank HOLDRS.
The trust's assets may increase or decrease as a
result of in-kind deposits and withdrawals of
the underlying securities during the life of the
trust.
9
<PAGE>
The Regional Bank HOLDRS....
The trust will issue Regional Bank HOLDRS that
represent your undivided beneficial ownership
interest in the shares of U.S.-traded common
stock held by the trust on your behalf. The
Regional Bank HOLDRS themselves are separate
from the underlying securities that are
represented by the Regional Bank HOLDRS.
The specific share amounts for each round-lot of
100 Regional Bank HOLDRS are set forth in the
chart below and were determined so that the
initial weightings of each underlying security
included in the Regional Bank HOLDRS
approximates the relative market capitalizations
of the specified companies (based on the closing
market prices of the underlying securities on
the trading day immediately preceding the
pricing date), subject to a maximum initial
weight of 10%.
The share amounts set forth below will not
change, except for changes due to corporate
events such as stock splits or reverse stock
splits on the underlying securities, or
reconstitution events. However, the weightings
are expected to change substantially over time
because of price fluctuations.
The following chart provides the
. names of the 20 issuers of the underlying
securities represented by the Regional Bank
HOLDRS,
. stock ticker symbols,
. share amounts represented by a round-lot of
100 Regional Bank HOLDRS as of June 21, 2000,
. initial weightings as of June 21, 2000, and
. principal market on which the shares of
common stock of the selected companies are
traded.
10
<PAGE>
<TABLE>
<CAPTION>
Primary
Share Initial Trading
Name of Company Ticker Amounts Weightings Market
---------------- ------ ------- ---------- -------
<S> <C> <C> <C> <C>
Wells Fargo &
Co. WFC 24 9.78% NYSE
FleetBoston
Financial
Corporation FBF 25 9.71% NYSE
Bank One
Corporation ONE 33 9.67% NYSE
First Union
Corporation FTU 29 8.75% NYSE
Firstar
Corporation FSR 29 6.79% NYSE
Fifth Third
Bancorp (/1/) FITB 9 5.82% NASDAQ
Mellon Financial
Corporation MEL 14 5.35% NYSE
State Street
Corporation STT 5 5.32% NYSE
The PNC
Financial
Services Group,
Inc. PNC 9 5.00% NYSE
Northern Trust
Corporation NTRS 7 4.92% NASDAQ
U.S. Bancorp USB 22 4.71% NYSE
SunTrust Banks,
Inc. STI 9 4.61% NYSE
Wachovia
Corporation WB 6 3.53% NYSE
National City
Corporation NCC 18 3.37% NYSE
BB&T Corporation BBT 10 2.72% NYSE
KeyCorp KEY 13 2.53% NYSE
Comerica
Incorporated CMA 5 2.39% NYSE
AmSouth
Bancorporation ASO 12 2.15% NYSE
Synovus
Financial Corp. SNV 8 1.49% NYSE
Marshall &
Ilsley
Corporation MI 3 1.37% NYSE
</TABLE>
--------
(1) On June 20, 2000, Fifth Third Bancorp
announced a 3-for-2 stock split payable to
stockholders of record as of June 30, 2000.
As of July 17, 2000, the share amount of
Fifth Third Bancorp, represented by a
round-lot of 100 Regional Bank HOLDRS, will
be 13.5.
These companies generally are considered to be
20 of the largest and most liquid companies with
U.S.-traded common stock involved in the
regional banking industry, as measured by market
capitalization and trading volume on May 2,
2000. The Bank of New York Company, Inc., as the
parent company of the trustee, is not one of the
companies included in the Regional Bank HOLDRS.
The market capitalization of a company is
determined by multiplying the price of its
common stock by the number of outstanding shares
of its common stock.
The trust only will issue and cancel, and you
only may obtain, hold, trade or surrender,
Regional Bank HOLDRS in a round-lot of 100
Regional Bank HOLDRS and round-lot multiples.
The trust will only issue Regional Bank HOLDRS
upon the deposit of the whole shares represented
by a round-lot of 100 Regional Bank HOLDRS. In
the event that a fractional share comes to be
represented by a round-lot of Regional Bank
HOLDRS, the trust may require a minimum of more
than one round-lot of 100 Regional Bank HOLDRS
for an issuance so that the trust will always
receive whole share amounts for issuance of
Regional Bank HOLDRS.
The number of outstanding Regional Bank HOLDRS
will increase and decrease as a result of in-
kind deposits and withdrawals of the underlying
securities. The trust will stand ready to issue
additional Regional Bank HOLDRS on a continuous
basis when an investor deposits the required
shares of common stock with the trustee.
11
<PAGE>
Public offering price....... The initial public offering price for 100
Regional Bank HOLDRS will equal the sum of the
closing market price on the primary trading
market on June 22, 2000, the pricing date, for
each underlying security multiplied by the share
amount to be determined on the pricing date,
plus an underwriting fee.
Purchases................... After the initial offering, you may acquire
Regional Bank HOLDRS in two ways:
. through an in-kind deposit of the required
number of shares of common stock of the
underlying issuers with the trustee, or
. through a cash purchase in the secondary
trading market.
Underwriting fees........... If you purchase Regional Bank HOLDRS in the
initial public offering, you will pay an
underwriting fee equal to 2%.
You will not be charged any issuance fee or
other sales commission in connection with
purchases of Regional Bank HOLDRS made in the
initial public offering.
Issuance and cancellation After the initial offering, if you wish to
fees........................ create Regional Bank HOLDRS by delivering to the
trust the requisite shares of common stock
represented by a round-lot of 100 Regional Bank
HOLDRS, The Bank of New York as trustee will
charge you an issuance fee of up to $10.00 for
each round-lot of 100 Regional Bank HOLDRS. If
you wish to cancel your Regional Bank HOLDRS and
withdraw your underlying securities, The Bank of
New York as trustee will charge you a
cancellation fee of up to $10.00 for each round-
lot of 100 Regional Bank HOLDRS.
Commissions................. If you choose to deposit underlying securities
in order to receive Regional Bank HOLDRS after
the conclusion of the initial public offering,
you will not be charged the underwriting fee.
However, in addition to the issuance fee charged
by the trustee described above, you will be
responsible for paying any sales commission
associated with your purchase of the underlying
securities that is charged by your broker,
whether it be Merrill Lynch, Pierce, Fenner &
Smith Incorporated or A.G. Edwards & Sons, Inc.,
collectively, the selling group, or another
broker.
Custody fees................ The Bank of New York, as trustee and as
custodian, will charge you a quarterly custody
fee of $2.00 for each round-lot of 100 Regional
Bank HOLDRS, to be deducted from any cash
dividend or other cash distributions on
underlying securities received by the trust.
With respect to the aggregate custody fee
payable in any calendar year for each Regional
Bank HOLDR, the trustee will waive that portion
of the fee which exceeds the total cash
dividends and other cash distributions received,
or to be received, and payable with respect to
such calendar year.
Rights relating to Regional
Bank HOLDRS................ You have the right to withdraw the underlying
securities upon request by delivering a round-
lot or integral multiple of a round-lot of
Regional Bank HOLDRS to the trustee, during the
trustee's
12
<PAGE>
business hours, and paying the cancellation
fees, taxes, and other charges. You should
receive the underlying securities no later than
the business day after the trustee receives a
proper notice of cancellation. The trustee will
not deliver fractional shares of underlying
securities. To the extent that any cancellation
of Regional Bank HOLDRS would otherwise require
the delivery of a fractional share, the trustee
will sell such share in the market and the
trust, in turn, will deliver cash in lieu of
such share. Except with respect to the right to
vote for dissolution of the trust, the Regional
Bank HOLDRS themselves will not have voting
rights.
Rights relating to the
underlying securities...... You have the right to:
. Receive all shareholder disclosure materials,
including annual and quarterly reports,
distributed by the issuers of the underlying
securities.
. Receive all proxy materials distributed by
the issuers of the underlying securities and
will have the right to instruct the trustee
to vote the underlying securities or may
attend shareholder meetings yourself.
. Receive dividends and other distributions on
the underlying securities, if any are
declared and paid to the trustee by an issuer
of the underlying securities, net of any
applicable taxes or fees.
If you wish to participate in a tender offer for
underlying securities, you must obtain the
underlying securities by surrendering your
Regional Bank HOLDRS and receiving all of your
underlying securities. For specific information
about obtaining your underlying securities, you
should read the discussion under the caption
"Description of the depositary trust agreement."
Reconstitution events....... A. If an issuer of underlying securities no
longer has a class of common stock registered
under section 12 of the Securities Exchange
Act of 1934, then its securities will no
longer be an underlying security and the
trustee will distribute the shares of that
company to the owners of the Regional Bank
HOLDRS.
B. If the SEC finds that an issuer of underlying
securities should be registered as an
investment company under the Investment
Company Act of 1940, and the trustee has
actual knowledge of the SEC finding, then the
trustee will distribute the shares of that
company to the owners of the Regional Bank
HOLDRS.
C. If the underlying securities of an issuer
cease to be outstanding as a result of a
merger, consolidation or other corporate
combination, the trustee will distribute the
consideration paid by and received from the
acquiring company to the beneficial owners of
Regional Bank HOLDRS, unless the merger,
consolidation or other corporate combination
is between companies that are already
included in the Regional Bank HOLDRS and the
consideration paid is additional underlying
13
<PAGE>
securities. In this case, the additional
underlying securities will be deposited into
the trust.
D. If an issuer's underlying securities are
delisted from trading on a national
securities exchange or NASDAQ and are not
listed for trading on another national
securities exchange or through NASDAQ within
five business days from the date such
securities are delisted.
If a reconstitution event occurs, the trustee
will deliver the underlying security to you as
promptly as practicable after the date that the
trustee has knowledge of the occurrence of a
reconstitution event.
Termination events......... A. The Regional Bank HOLDRS are delisted from
the American Stock Exchange and are not
listed for trading on another national
securities exchange or through NASDAQ within
five business days from the date the
Regional Bank HOLDRS are delisted.
B. The trustee resigns and no successor trustee
is appointed within 60 days from the date
the trustee provides notice to Merrill
Lynch, Pierce, Fenner & Smith Incorporated,
as initial depositor, of its intent to
resign.
C. 75% of beneficial owners of outstanding
Regional Bank HOLDRS vote to dissolve and
liquidate the trust.
If a termination event occurs, the trustee will
distribute the underlying securities to you as
promptly as practicable after the termination
event.
Federal income tax The federal income tax laws will treat a U.S.
consequences............... holder of Regional Bank HOLDRS as directly
owning the underlying securities. The Regional
Bank HOLDRS themselves will not result in any
federal tax consequences separate from the tax
consequences associated with ownership of the
underlying securities.
Listing.................... The Regional Bank HOLDRS have been approved for
listing on the American Stock Exchange under
the symbol "RKH", subject to official notice of
issuance. Trading will take place only in
round-lots of 100 Regional Bank HOLDRS and
round-lot multiples. A minimum of 150,000
Regional Bank HOLDRS will be required to be
outstanding when trading begins.
Trading.................... Investors only will be able to acquire, hold,
transfer and surrender a round-lot of 100
Regional Bank HOLDRS. Bid and ask prices,
however, will be quoted per single Regional
Bank HOLDR.
Clearance and settlement... The trust will issue Regional Bank HOLDRS in
book-entry form. Regional Bank HOLDRS will be
evidenced by one or more global certificates
that the trustee will deposit with The
Depository Trust Company, referred to as DTC.
Transfers within DTC will be in accordance with
DTC's usual rules and operating procedures. For
further information see "Description of
Regional Bank HOLDRS."
14
<PAGE>
THE TRUST
General. This discussion highlights information about the Regional Bank
HOLDRS Trust. You should read this information, information about the
depositary trust agreement as well as the depositary trust agreement before you
purchase Regional Bank HOLDRS. The material terms of the depositary trust
agreement are described in this prospectus under the heading "Description of
the depositary trust agreement."
The Regional Bank HOLDRS Trust. The trust will be formed pursuant to the
depositary trust agreement, dated as of May 18, 2000, as amended and restated
on June 21, 2000. The Bank of New York will be the trustee. The Regional Bank
HOLDRS Trust is not a registered investment company under the Investment
Company Act of 1940.
The Regional Bank HOLDRS Trust is intended to hold deposited shares for
the benefit of owners of Regional Bank HOLDRS. The trustee will perform only
administrative and ministerial acts. The property of the trust will consist of
the underlying securities and all monies or other property, if any, received by
the trustee. The trust will terminate on December 31, 2040, or earlier if a
termination event occurs.
DESCRIPTION OF REGIONAL BANK HOLDRS
The trust will issue Regional Bank HOLDRS under the depositary trust
agreement described in this prospectus under the heading "Description of the
depositary trust agreement." After the initial offering, the trust may issue
additional Regional Bank HOLDRS on a continuous basis when an investor deposits
the requisite underlying securities with the trustee.
You may only acquire, hold, trade and surrender Regional Bank HOLDRS in a
round-lot of 100 Regional Bank HOLDRS and round-lot multiples. The trust will
only issue Regional Bank HOLDRS upon the deposit of the whole shares of
underlying securities that are represented by a round-lot of 100 Regional Bank
HOLDRS. In the event of a stock split, reverse stock split, or other
distribution by the issuer of an underlying security that results in a
fractional share becoming represented by a round-lot of Regional Bank HOLDRS,
the trust may require a minimum of more than one round-lot of 100 Regional Bank
HOLDRS for an issuance so that the trust will always receive whole share
amounts for issuance of Regional Bank HOLDRS.
Regional Bank HOLDRS will represent your individual and undivided
beneficial ownership interest in the common stock of the specified underlying
securities. The 20 companies selected as part of this receipt program are
listed above in the section entitled "Highlights of Regional Bank HOLDRS--The
Regional Bank HOLDRS."
Beneficial owners of Regional Bank HOLDRS will have the same rights and
privileges as they would have if they beneficially owned the underlying
securities outside of the trust. These include the right of investors to
instruct the trustee to vote the common stock, and to receive dividends and
other distributions on the underlying securities, if any are declared and paid
to the trustee by an issuer of an underlying security, as well as the right to
cancel Regional Bank HOLDRS to receive the underlying securities. See
"Description of the depositary trust agreement." Regional Bank HOLDRS are not
intended to change your beneficial ownership in the underlying securities under
federal securities laws, including Sections 13(d) and 16(a) of the Securities
Exchange Act of 1934.
The trust will not publish or otherwise calculate the aggregate value of
the underlying securities represented by a receipt. Regional Bank HOLDRS may
trade in the secondary market at prices that are lower than the aggregate value
of the corresponding underlying securities. If, in such case, an owner of
Regional Bank HOLDRS wishes to realize the dollar value of the underlying
securities, that owner will have to cancel the Regional Bank HOLDRS. Such
cancellation will require payment of fees and expenses as described in
"Description of the depositary trust agreement--Withdrawal of underlying
securities."
15
<PAGE>
Regional Bank HOLDRS will be evidenced by one or more global certificates
that the trustee will deposit with DTC and register in the name of Cede & Co.,
as nominee for DTC. Regional Bank HOLDRS will be available only in book-entry
form. Owners of Regional Bank HOLDRS may hold their Regional Bank HOLDRS
through DTC, if they are participants in DTC, or indirectly through entities
that are participants in DTC.
DESCRIPTION OF THE UNDERLYING SECURITIES
Selection criteria. The underlying securities are the common stocks of a
group of 20 specified companies involved in various aspects of the regional
banking industry and whose common stock is registered under Section 12 of the
Exchange Act. The issuers of the underlying securities are considered to be 20
of the largest capitalized, most liquid companies involved in the regional
banking industry as measured by market capitalization and trading volume. The
Bank of New York Company, Inc., as the parent company of the trustee, is not
one of the companies included in the Regional Bank HOLDRS. The following
criteria were used in selecting the underlying securities on May 2, 2000:
. Market capitalization equal to or greater than $5 billion;
. Average daily trading volume of at least 200,000 shares over the
60 trading days before May 2, 2000;
. Average daily dollar volume (that is, the average daily trading
volume multiplied by the average closing price over the 60 day
period prior to May 2, 2000) of at least $5 million over the 60
trading days before May 2, 2000; and
. A trading history of at least 90 calendar days.
The market capitalization of a company is determined by multiplying the
price of its common stock by the number of shares of its common stock that are
held by stockholders. In determining whether a company was to be considered for
inclusion in the Regional Bank HOLDRS, Merrill Lynch, Pierce, Fenner & Smith
Incorporated examined available public information about the company, including
analysts' reports and other independent market sources. The ultimate
determination of the inclusion of the 20 specified companies, however, rested
solely within the discretion of Merrill Lynch, Pierce, Fenner & Smith
Incorporated.
After the initial deposit, one or more of the issuers of the underlying
securities may no longer be substantially involved in the regional banking
industry. In this case, the Regional Bank HOLDRS may no longer consist of
securities issued by companies involved in the regional banking industry.
Merrill Lynch, Pierce, Fenner & Smith Incorporated will determine, in its sole
discretion, whether the issuer of a particular underlying security remains in
the regional banking industry and will undertake to make adequate disclosure
when necessary.
Underlying securities. For a list of the underlying securities
represented by Regional Bank HOLDRS, please refer to "Highlights of Regional
Bank HOLDRS--The Regional Bank HOLDRS." If the underlying securities change
because of a reconstitution event, a revised list of underlying securities will
be set forth in a prospectus supplement and will be available from the American
Stock Exchange and through a widely-used electronic information dissemination
system such as Bloomberg or Reuters.
No investigation. In selecting the underlying securities, the trust, the
trustee, Merrill Lynch, Pierce, Fenner & Smith Incorporated, and any affiliate
of these entities, have not performed any investigation or review of the
selected companies, including the public filings by the companies, other than
to the extent required to determine whether the companies satisfied the
program's stated selection criteria. Accordingly, before you acquire Regional
Bank HOLDRS, you should consider publicly available financial and other
information about the issuers of the underlying securities. See "Risk factors"
and "Where you can find more information." Investors and market participants
should not conclude that the inclusion of a company in the list is any form of
investment recommendation of that company by the trust, the trustee, Merrill
Lynch, Pierce, Fenner & Smith Incorporated, the selling group or any of their
affiliates.
General background and historical information. For a brief description of
the business of each of the issuers of the underlying securities and monthly
pricing information showing the historical performance of each underlying
issuer's securities see "Annex A."
16
<PAGE>
The following table and graph set forth the composite performance of all
of the underlying securities represented by a single Regional Bank HOLDR based
upon the share amounts set forth in the table on page 11 of this prospectus,
measured at the close of each month from January 1995 to May 2000. The
performance table and graph data are adjusted for any splits that may have
occurred over the measurement period. Past movements of the underlying
securities are not necessarily indicative of future values.
<TABLE>
<S> <C>
1995 Value
---- -----
January .......... 43.40
February.......... 45.13
March............. 44.77
April............. 45.49
May............... 49.76
June.............. 48.99
July.............. 49.85
August............ 52.02
September......... 54.45
October........... 53.61
November.......... 58.28
December.......... 58.48
</TABLE>
<TABLE>
<S> <C>
1997 Value
---- ------
January ......... 83.30
February......... 87.05
March............ 80.29
April............ 85.45
May.............. 88.73
June............. 93.18
July............. 104.03
August........... 99.26
September........ 106.35
October.......... 104.74
November......... 111.13
December......... 117.76
</TABLE>
<TABLE>
<S> <C>
1999 Value
---- ------
January ......... 126.42
February......... 126.43
March............ 124.79
April............ 134.77
May.............. 126.34
June............. 128.47
July............. 119.55
August........... 111.73
September........ 106.22
October.......... 122.43
November......... 113.17
December......... 100.90
</TABLE>
<TABLE>
<S> <C>
1996 Value
---- -----
January .......... 58.95
February.......... 61.19
March............. 61.83
April............. 62.10
May............... 63.00
June.............. 61.79
July.............. 62.04
August............ 65.58
September......... 70.17
October........... 74.95
November.......... 81.57
December.......... 76.92
</TABLE>
<TABLE>
<S> <C>
1998 Value
---- ------
January ......... 113.23
February......... 122.51
March............ 130.98
April............ 131.76
May.............. 124.59
June............. 128.60
July............. 127.67
August........... 100.50
September........ 110.95
October.......... 122.32
November......... 125.38
December......... 132.28
</TABLE>
<TABLE>
<S> <C>
2000 Value
---- ------
January ......... 98.14
February......... 83.29
March............ 101.39
April............ 96.38
May.............. 107.33
</TABLE>
[LINE GRAPH]
17
<PAGE>
DESCRIPTION OF THE DEPOSITARY TRUST AGREEMENT
General. The depositary trust agreement, dated as of May 18, 2000, as
amended and restated on June 21, 2000, among Merrill Lynch, Pierce, Fenner &
Smith Incorporated, The Bank of New York, as trustee, other depositors and the
owners of the Regional Bank HOLDRS, provides that Regional Bank HOLDRS will
represent an owner's undivided beneficial ownership interest in the common
stock of the underlying companies.
The trustee. The Bank of New York will serve as trustee. The Bank of New
York, which was founded in 1784, was New York's first bank and is the oldest
bank in the country still operating under its original name. The Bank is a
state-chartered New York banking corporation and a member of the Federal
Reserve System. The Bank conducts a national and international wholesale
banking business and a retail banking business in the New York City, New Jersey
and Connecticut areas, and provides a comprehensive range of corporate and
personal trust, securities processing and investment services.
Issuance, transfer and surrender of Regional Bank HOLDRS. You may create
and cancel Regional Bank HOLDRS only in round-lots of 100 Regional Bank HOLDRS.
You may create Regional Bank HOLDRS by delivering to the trustee the requisite
underlying securities. The trust will only issue Regional Bank HOLDRS upon the
deposit of the whole shares represented by a round-lot of 100 Regional Bank
HOLDRS. In the event that a fractional share comes to be represented by a
round-lot of Regional Bank HOLDRS, the trust may require a minimum of more than
one round-lot of 100 Regional Bank HOLDRS for an issuance so that the trust
will always receive whole share amounts for issuance of Regional Bank HOLDRS.
Similarly, you must surrender Regional Bank HOLDRS in integral multiples of 100
Regional Bank HOLDRS to withdraw deposited shares from the trust. The trustee
will not deliver fractional shares of underlying securities, to the extent that
any cancellation of Regional Bank HOLDRS would otherwise require the delivery
of fractional shares, the trust will deliver cash in lieu of such shares. You
may request withdrawal of your deposited shares during the trustee's normal
business hours. The trustee expects that in most cases it will deliver your
deposited shares within one business day of your withdrawal request.
Voting rights. The trustee will deliver you proxy soliciting materials
provided by issuers of the deposited shares so as to permit you to give the
trustee instructions as to how to vote on matters to be considered at any
annual or special meetings held by issuers of the underlying securities.
Under the depositary trust agreement, any beneficial owner of Regional
Bank HOLDRS, other than Merrill Lynch, Pierce, Fenner & Smith Incorporated
owning Regional Bank HOLDRS for its own proprietary account as principal, will
have the right to vote to dissolve and liquidate the trust.
Distributions. You will be entitled to receive, net of trustee fees,
distributions of cash, including dividends, securities or property, if any,
made with respect to the underlying securities. The trustee will use its
reasonable efforts to ensure that it distributes these distributions as
promptly as practicable after the date on which it receives the distribution.
Therefore, you may receive your distributions substantially later than you
would have had you held the underlying securities directly. You will be
obligated to pay any tax or other charge that may become due with respect to
Regional Bank HOLDRS. The trustee may deduct the amount of any tax or other
governmental charge from a distribution before making payment to you. In
addition, the trustee will deduct its quarterly custody fee of $2.00 for each
round-lot of 100 Regional Bank HOLDRS from quarterly dividends, if any, paid to
the trustee by the issuers of the underlying securities. With respect to the
aggregate custody fee payable in any calendar year for each Regional Bank
HOLDR, the trustee will waive that portion of the fee which exceeds the total
cash dividends and other cash distributions received, or to be received, and
payable with respect to such calendar year.
Record dates. With respect to dividend payments and voting instructions,
the trustee expects to fix the trust's record dates as close as possible to the
record date fixed by the issuer of the underlying securities.
18
<PAGE>
Shareholder communications. The trustee promptly will forward to you all
shareholder communications that it receives from issuers of the underlying
securities.
Withdrawal of underlying securities. You may surrender your Regional Bank
HOLDRS and receive underlying securities during the trustee's normal business
hours and upon the payment of applicable fees, taxes or governmental charges,
if any. You should receive your underlying securities no later than the
business day after the trustee receives your request. If you surrender Regional
Bank HOLDRS in order to receive underlying securities, you will pay to the
trustee a cancellation fee of up to $10.00 per round-lot of 100 Regional Bank
HOLDRS.
Further issuances of Regional Bank HOLDRS. The depositary trust agreement
provides for further issuances of Regional Bank HOLDRS on a continuous basis
without your consent.
Reconstitution events. The depositary trust agreement provides for the
automatic distribution of underlying securities to you in four circumstances.
A. If an issuer of underlying securities no longer has a class of common
stock registered under section 12 of the Securities Exchange Act of
1934, then its securities will no longer be an underlying security
and the trustee will distribute the shares of that company to the
owners of the Regional Bank HOLDRS.
B. If the SEC finds that an issuer of underlying securities should be
registered as an investment company under the Investment Company Act
of 1940, and the trustee has actual knowledge of the SEC finding,
then the trustee will distribute the shares of that company to the
owners of the Regional Bank HOLDRS.
C. If the underlying securities of an issuer cease to be outstanding as
a result of a merger, consolidation or other corporate combination,
the trustee will distribute the consideration paid by and received
from the acquiring company to the beneficial owners of Regional Bank
HOLDRS, unless the merger, consolidation or other corporate
combination is between companies that are already included in the
Regional Bank HOLDRS and the consideration paid is additional
underlying securities. In this case, the additional underlying
securities will be deposited into the trust.
D. If an issuer's underlying securities are delisted from trading on a
national securities exchange or NASDAQ and are not listed for trading
on another national securities exchange or through NASDAQ within 5
business days from the date such securities are delisted.
If a reconstitution event occurs, the trustee will deliver the underlying
security to you as promptly as practicable after the date that the trustee has
knowledge of the occurrence of a reconstitution event.
Termination of the trust. The trust will terminate if the trustee resigns
and no successor trustee is appointed by Merrill Lynch, Pierce, Fenner & Smith
Incorporated, as initial depositor, within 60 days from the date the trustee
provides notice to Merrill Lynch, Pierce, Fenner & Smith Incorporated, as
initial depositor, of its intent to resign. Upon termination, the beneficial
owners of Regional Bank HOLDRS will surrender their Regional Bank HOLDRS as
provided in the depositary trust agreement, including payment of any fees of
the trustee or applicable taxes or governmental charges due in connection with
delivery to the owners of the underlying securities. The trust also will
terminate if Regional Bank HOLDRS are delisted from the American Stock Exchange
and are not listed for trading on another national securities exchange or
through NASDAQ within 5 business days from the date the Regional Bank HOLDRS
are delisted. Finally, the trust will terminate if 75% of the owners of
outstanding Regional Bank HOLDRS other than Merrill Lynch, Pierce, Fenner &
Smith Incorporated vote to dissolve and liquidate the trust.
If a termination event occurs, the trustee will distribute the underlying
securities to you as promptly as practicable after the termination event
occurs.
19
<PAGE>
Amendment of the depositary trust agreement. The trustee and Merrill
Lynch, Pierce, Fenner & Smith Incorporated, as initial depositor, may amend any
provisions of the depositary trust agreement without the consent of any other
depositor or any of the owners of the Regional Bank HOLDRS. Promptly after the
execution of any amendment to the agreement, the trustee must furnish or cause
to be furnished written notification of the substance of the amendment to each
owner of Regional Bank HOLDRS. Any amendment that imposes or increases any fees
or charges, subject to exceptions, or that otherwise prejudices any substantial
existing right of the owners of Regional Bank HOLDRS will not become effective
until 30 days after notice of the amendment is given to the owners of Regional
Bank HOLDRS.
Issuance and cancellation fees. After the initial public offering, the
trust expects to issue more Regional Bank HOLDRS. If you wish to create
Regional Bank HOLDRS by delivering to the trust the requisite underlying
securities, the trustee will charge you an issuance fee of up to $10.00 for
each round-lot of 100 Regional Bank HOLDRS. If you wish to cancel your Regional
Bank HOLDRS and withdraw your underlying securities, the trustee will charge
you a cancellation fee of up to $10.00 for each round-lot of 100 Regional Bank
HOLDRS issued. The trustee may negotiate either of these fees depending on the
volume, frequency and size of the issuance or cancellation transactions.
Commissions. If you choose to create Regional Bank HOLDRS after the
conclusion of the initial public offering, you will not be charged the
underwriting fee. However, in addition to the issuance and cancellation fees
described above, you will be responsible for paying any sales commissions
associated with your purchase of the underlying securities that is charged by
your broker, whether it be any of the members of the selling group or another
broker.
Custody fees. The Bank of New York, as trustee and as custodian, will
charge you a quarterly custody fee of $2.00 for each round-lot of 100 Regional
Bank HOLDRS to be deducted from any dividend payments or other cash
distributions on underlying securities received by the trustee. With respect to
the aggregate custody fee payable in any calendar year for each Regional Bank
HOLDR, the Trustee will waive that portion of the fee which exceeds the total
cash dividends and other cash distributions received, or to be received, and
payable with respect to such calendar year. The trustee cannot recapture unpaid
custody fees from prior years.
Address of the trustee. The Bank of New York, ADR Department, 101 Barclay
Street, New York, New York 10286.
Governing law. The depositary trust agreement and Regional Bank HOLDRS
will be governed by the laws of the State of New York. The trustee will provide
the depositary trust agreement to any owner of the underlying securities free
of charge upon written request.
Duties and immunities of the trustee. The trustee will assume no
responsibility or liability for, and makes no representations as to, the
validity or sufficiency, or as to the accuracy of the recitals, if any, set
forth in the Regional Bank HOLDRS.
The trustee undertakes to perform only those duties as are specifically
set forth in the depositary trust agreement. Subject to the preceding sentence,
the trustee will be liable for its own negligence or misconduct except for good
faith errors in judgment so long as the trustee was not negligent in
ascertaining the relevant facts.
20
<PAGE>
FEDERAL INCOME TAX CONSEQUENCES
General
The following is a summary of the U.S. federal income tax consequences
relating to the Regional Bank HOLDRS for:
. a citizen or resident of the United States;
. a corporation or partnership created or organized in the United
States or under the laws of the United States;
. an estate, the income of which is includible in gross income for
U.S. federal income tax purposes regardless of its source;
. or a trust if a court within the United States is able to exercise
primary supervision over the administration of the trust and one
or more U.S. persons have the authority to control all substantial
decisions of the trust (each of the above, a "U.S. receipt
holder"); and
. any person other than a U.S. receipt holder (a "Non-U.S. receipt
holder").
This summary is based upon laws, regulations, rulings and decisions
currently in effect, all of which are subject to change, possibly on a
retroactive basis. The discussion does not deal with all U.S. federal income
tax consequences applicable to all categories of investors, some of which may
be subject to special rules. In addition, this summary generally is limited to
investors who will hold the Regional Bank HOLDRS as "capital assets"
(generally, property held for investment) within the meaning of Section 1221 of
the Internal Revenue Code of 1986, as amended. We suggest that you consult with
your own tax advisor.
Taxation of the trust
The trust will provide for flow through tax consequences as it will be
treated as a grantor trust or custodial arrangement for United States federal
income tax purposes.
Taxation of Regional Bank HOLDRS
A receipt holder purchasing and owning Regional Bank HOLDRS will be
treated, for U.S. federal income tax purposes, as directly owning a
proportionate share of the underlying securities represented by Regional Bank
HOLDRS. Consequently, if there is a taxable cash distribution on an underlying
security, a holder will recognize income with respect to the distribution at
the time the distribution is received by the trustee, not at the time that the
holder receives the cash distribution from the trustee.
A receipt holder will determine its initial tax basis in each of the
underlying securities by allocating the purchase price for the Regional Bank
HOLDRS among the underlying securities based on their relative fair market
values at the time of purchase. Similarly, when a holder sells a receipt, it
will determine the amount realized with respect to each security by allocating
the sales price among the underlying securities based on their relative fair
market values at the time of sale. A holder's gain or loss with respect to each
security will be computed by subtracting its basis in the security from the
amount realized on the security. With respect to purchases of Regional Bank
HOLDRS for cash in the secondary market, a receipt holder's aggregate tax basis
in each of the underlying securities will be equal to the purchase price of the
Regional Bank HOLDRS. Similarly, with respect to sales of Regional Bank HOLDRS
for cash in the secondary market, the amount realized with respect to a sale of
Regional Bank HOLDRS will be equal to the aggregate amount realized with
respect to each of the underlying securities.
The distribution of any securities by the trust upon the surrender of
Regional Bank HOLDRS, the occurrence of a reconstitution event, or a
termination event will not be a taxable event. The receipt holders holding
period with respect to the distributed securities will include the period that
the holder held the securities through the trust.
21
<PAGE>
Brokerage fees and custodian fees
The brokerage fee incurred in purchasing a receipt will be treated as
part of the cost of the underlying securities. Accordingly, a holder includes
this fee in its tax basis in the underlying securities. A holder will allocate
the brokerage fee among the underlying securities using either a fair market
value allocation or pro rata based on the number of shares of each underlying
security. Similarly, the brokerage fee incurred in selling Regional Bank HOLDRS
will reduce the amount realized with respect to the underlying securities.
A holder will be required to include in its income the full amount of
dividends paid on the underlying securities, even though the depositary trust
agreement provides that the custodian fees will be deducted directly from any
dividends paid. These custodian fees will be treated as an expense incurred in
connection with a holder's investment in the underlying securities and may be
deductible. If a holder is an individual, estate or trust, however, the
deduction of its share of custodian fees will be a miscellaneous itemized
deduction that may be disallowed in whole or in part.
Non-U.S. receipt holders
Non-U.S. receipt holders should consult their tax advisors regarding U.S.
withholding and other taxes which may apply to ownership of the Regional Bank
HOLDRS or of the underlying securities through an investment in the Regional
Bank HOLDRS.
ERISA CONSIDERATIONS
Any plan fiduciary which proposes to have a plan acquire Regional Bank
HOLDRS should consult with its counsel with respect to the potential
applicability of ERISA and the Internal Revenue Code to this investment and
whether any exemption would be applicable and determine on its own whether all
conditions have been satisfied. Moreover, each plan fiduciary should determine
whether, under the general fiduciary standards of investment prudence and
diversification, an acquisition of Regional Bank HOLDRS is appropriate for the
plan, taking into account the overall investment policy of the plan and the
composition of the plan's investment portfolio.
PLAN OF DISTRIBUTION
In accordance with the depositary trust agreement, the trust will issue
to Merrill Lynch, Pierce, Fenner & Smith Incorporated, and Merrill Lynch,
Pierce, Fenner & Smith Incorporated will deposit the underlying securities to
receive Regional Bank HOLDRS. The selling group proposes to offer the Regional
Bank HOLDRS to the public at the offering price set forth on the cover page of
this prospectus, which includes an underwriting fee of 2%. Merrill Lynch,
Pierce, Fenner & Smith Incorporated will provide Regional Bank HOLDRS to A.G.
Edwards & Sons, Inc. at the public offering price, as set forth on the cover
page of this prospectus, less a concession that is not in excess of 1.5%. We
expect the trust to deliver the initial distribution of Regional Bank HOLDRS
against deposit of the underlying securities in New York, New York on June 27,
2000. After the initial offering, the public offering price, concession and
discount may be changed. The trust will continue to issue Regional Bank HOLDRS,
in connection with deposits of underlying securities. This offering is being
made in compliance with Conduct Rule 2810 of the National Association of
Securities Dealers, Inc. Accordingly, sales will not be made to a discretionary
account without the prior written approval of a purchaser of Regional Bank
HOLDRS.
Members of the selling group and their affiliates have from time to time
provided investment banking and other financial services to certain of the
issuers of the underlying securities and expect in the future to provide these
services, for which they have received and will receive customary fees and
commissions. They also may have served as counterparty in other transactions
with certain of the issuers of the underlying securities.
22
<PAGE>
Merrill Lynch, Pierce, Fenner & Smith Incorporated may use this
prospectus, as updated from time to time, in connection with offers and sales
related to market-making transactions in the Regional Bank HOLDRS. Merrill
Lynch, Pierce, Fenner & Smith Incorporated may act as principal or agent in
such transactions. Market-making sales will be made at prices related to
prevailing market prices at the time of sale.
Merrill Lynch, Pierce, Fenner & Smith Incorporated has agreed to
indemnify the trustee against certain civil liabilities related to acts
performed or not performed by the trustee in accordance with the depositary
trust agreement or periodic reports filed or not filed with the SEC with
respect to the Regional Bank HOLDRS. Should a court determine not to enforce
the indemnification provision, Merrill Lynch, Pierce, Fenner & Smith
Incorporated also has agreed to contribute to payments the trustee may be
required to make with respect to such liabilities.
LEGAL MATTERS
Legal matters, including the validity of the Regional Bank HOLDRS will be
passed upon for Merrill Lynch, Pierce, Fenner & Smith Incorporated, the initial
depositor and the underwriters, by Shearman & Sterling, New York, New York.
Shearman & Sterling, as special U.S. tax counsel to the trust, also will render
an opinion regarding the material federal income tax consequences relating to
the Regional Bank HOLDRS.
WHERE YOU CAN FIND MORE INFORMATION
Merrill Lynch, Pierce, Fenner & Smith Incorporated has filed a
registration statement on Form S-1 with the SEC covering the Regional Bank
HOLDRS. While this prospectus is a part of the registration statement, it does
not contain all the exhibits filed as part of the registration statement. You
should consider reviewing the full text of those exhibits.
The registration statement is available over the Internet at the SEC's
Web site at http://www.sec.gov. You also may read and copy the registration
statement at the SEC's public reference rooms in Washington, D.C., New York,
New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for more
information on the public reference rooms and their copy charges. Merrill
Lynch, Pierce, Fenner & Smith Incorporated will not and the trust may not be
subject to the requirements of the Exchange Act and accordingly may not file
periodic reports.
Because the common stock of the issuers of the underlying securities is
registered under the Exchange Act, the issuers of the underlying securities are
required to file periodically financial and other information specified by the
SEC. For more information about the issuers of the underlying securities,
information provided to or filed with the SEC by the issuers of the underlying
securities with respect to their registered securities can be inspected at the
SEC's public reference facilities or accessed through the SEC's Web site
referenced above. In addition, information regarding the issuers of the
underlying securities may be obtained from other sources including, but not
limited to, press releases, newspaper articles and other publicly disseminated
information.
The trust and the selling group and their affiliates are not affiliated
with the issuers of the underlying securities, and the issuers of the
underlying securities have no obligations with respect to Regional Bank HOLDRS.
This prospectus relates only to Regional Bank HOLDRS and does not relate to the
common stock or other securities of the issuers of the underlying securities.
The information in this prospectus regarding the issuers of the underlying
securities has been derived from the publicly available documents described in
the preceding paragraph. We have not participated in the preparation of these
documents or made any due diligence inquiries with respect to the issuers of
the underlying securities in connection with Regional Bank HOLDRS. We make no
representation that these publicly available documents or any other publicly
available information regarding the issuers of the underlying securities are
accurate or complete. Furthermore, we cannot assure you that all events
occurring prior to the date of this prospectus, including events that would
affect the accuracy or completeness of the publicly available documents
described in the preceding paragraph, that would affect the trading price of
the common stock of the issuers of the underlying securities, and therefore the
offering and trading prices of the Regional Bank HOLDRS, have been publicly
disclosed.
23
<PAGE>
ANNEX A
This annex forms an integral part of the prospectus.
The following tables provide a brief description of the business of each
of the issuers of the underlying securities and set forth the split-adjusted
closing market prices, as reported on the applicable primary trading market, of
each of the underlying securities in each month during 1995, 1996, 1997, 1998,
1999 and 2000 through May 2000. All market prices in excess of one dollar are
rounded to the nearest one sixty-fourth of a dollar. The historical prices of
the underlying securities should not be taken as an indication of future
performance.
AMSOUTH BANCORPORATION (ASO)
AmSouth Bancorporation is a bank holding company which, through its
subsidiaries, provides a broad array of financial products and services through
banking offices. AmSouth's principal activities include consumer and commercial
banking and capital management. AmSouth operates in nine southeastern states
with leading market positions in Tennessee, Florida, Alabama, and Mississippi.
In addition, AmSouth provides select financial services outside of its banking
markets through non-bank subsidiaries.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- -------- --------- -------- --------- -------- --------- -------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 8 5/64 January 11 47/64 January 15 17/64 January 24 January 29 3/8 January 17 7/16
February 8 5/8 February 11 43/64 February 15 3/16 February 24 31/32 February 31 21/64 February 14 5/16
March 9 21/64 March 11 33/64 March 14 19/64 March 26 1/4 March 30 21/64 March 14 15/16
April 9 17/64 April 11 3/8 April 15 5/8 April 27 23/32 April 31 45/64 April 14 9/16
May 9 57/64 May 11 17/64 May 17 25/64 May 25 5/8 May 28 3/8 May 18 1/16
June 9 43/64 June 10 45/64 June 16 13/16 June 26 13/64 June 23 3/16
July 10 13/32 July 10 59/64 July 19 11/64 July 26 29/64 July 22 7/8
August 11 5/64 August 11 43/64 August 18 11/16 August 22 59/64 August 21 7/8
September 11 17/64 September 13 3/16 September 21 17/32 September 22 3/4 September 23 7/16
October 11 13/16 October 13 47/64 October 21 23/64 October 26 51/64 October 25 5/8
November 11 45/65 November 14 25/32 November 23 9/64 November 28 11/64 November 22 9/16
December 11 31/32 December 14 21/64 December 24 9/64 December 30 26/64 December 19 5/16
</TABLE>
The closing price on June 22, 2000 was 17 1/8.
A-1
<PAGE>
BANK ONE CORPORATION (ONE)
Bank One Corporation is a bank holding company which, through its
subsidiaries, provides retail banking, worldwide corporate and institutional
banking and trust and investment management services. Bank One also engages in
credit card processing, mortgage lending and servicing, insurance, venture
capital financing, investment and merchant banking, trust, brokerage and
investment management services and data processing. Bank One operates banking
offices in Florida and the midwest and southwest United States.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- -------- --------- -------- --------- -------- --------- -------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 24 3/8 January 31 19/64 January 41 1/4 January 50 51/64 January 52 3/8 January 29 13/16
February 24 11/64 February 32 25/64 February 40 7/64 February 56 1/2 February 53 3/4 February 25 7/8
March 23 35/64 March 32 25/64 March 36 9/64 March 63 1/4 March 55 1/16 March 34 3/8
April 24 3/8 April 31 19/32 April 38 33/64 April 58 13/16 April 58 3/32 April 30 1/2
May 28 23/32 May 33 41/64 May 39 5/16 May 55 1/8 May 56 9/16 May 33 1/8
June 26 21/32 June 30 29/32 June 44 1/32 June 55 13/16 June 59 9/16
July 26 15/64 July 31 23/64 July 51 1/64 July 51 11/16 July 54 9/16
August 27 51/64 August 34 57/64 August 48 11/16 August 38 1/16 August 40 1/8
September 30 11/64 September 37 17/64 September 50 29/32 September 42 7/16 September 34 13/16
October 27 57/64 October 38 3/4 October 47 25/64 October 48 3/4 October 37 13/16
November 31 39/64 November 43 19/64 November 46 45/64 November 51 1/2 November 35 5/16
December 31 3/32 December 39 3/32 December 49 3/8 December 51 1/16 December 32
</TABLE>
The closing price on June 22, 2000 was 28 3/16.
BB&T CORPORATION (BBT)
BB&T Corporation is a bank holding company which, through its
subsidiaries, provides a full range of traditional commercial banking services
and related financial services including investment brokerage, investment
banking, trust, insurance and leasing services. BB&T operates in North
Carolina, South Carolina, Virginia, Maryland, Georgia, West Virginia, Kentucky
and the metropolitan Washington, D.C. area.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- -------- --------- -------- --------- -------- --------- -------- --------- -------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 10 1/8 January 14 9/16 January 19 3/8 January 29 15/32 January 38 1/4 January 28 1/8
February 11 3/16 February 14 February 19 7/16 February 31 1/32 February 37 7/8 February 23 1/2
March 9 15/16 March 13 7/8 March 18 5/8 March 33 27/32 March 36 3/16 March 28 1/16
April 10 1/4 April 13 15/16 April 19 5/8 April 33 5/8 April 39 15/16 April 26 5/8
May 10 7/8 May 14 5/8 May 20 May 33 3/32 May 36 1/2 May 29 5/16
June 12 June 15 7/8 June 22 1/2 June 33 13/16 June 36 11/16
July 12 July 14 5/8 July 25 9/16 July 35 1/8 July 35 1/4
August 13 3/8 August 15 5/8 August 25 7/8 August 28 August 33 1/2
September 13 1/8 September 16 5/8 September 26 23/32 September 29 15/16 September 32 3/8
October 12 7/8 October 17 5/16 October 27 7/32 October 35 3/4 October 36 3/8
November 13 1/8 November 18 3/8 November 27 1/4 November 36 15/16 November 32 1/4
December 13 1/8 December 18 1/8 December 32 1/32 December 40 5/16 December 27 3/8
</TABLE>
The closing price on June 22, 2000 was 26.
A-2
<PAGE>
COMERICA INCORPORATED (CMA)
Comerica, Incorporated is a bank holding company which offers consumer
banking, business banking and investment services. Comerica's consumer banking
services include lending, mortgage services, deposit service, small business
banking and private banking. Its business banking services include large
corporate banking, treasury management and international financial services.
Comerica's investment services include the sale of mutual fund and annuity
products and disability and long-term care insurance products. Comerica
operates primarily in Michigan, Texas, California and Florida.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- -------- --------- -------- --------- -------- --------- -------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 16 3/4 January 26 1/2 January 38 5/64 January 62 59/64 January 62 7/16 January 44 3/16
February 18 53/64 February 25 59/64 February 40 5/64 February 67 13/64 February 66 1/4 February 36 13/16
March 18 21/64 March 27 53/64 March 37 37/64 March 70 35/64 March 62 7/16 March 41 7/8
April 19 11/64 April 29 April 39 April 66 15/16 April 65 1/16 April 42 3/8
May 21 5/64 May 29 11/64 May 41 43/64 May 66 3/4 May 60 7/16 May 50 5/8
June 21 27/64 June 29 3/4 June 45 21/64 June 66 1/8 June 59 7/16
July 23 21/64 July 29 1/4 July 50 27/64 July 67 3/8 July 55 1/2
August 23 3/4 August 32 1/2 August 47 13/64 August 52 1/4 August 52 3/32
September 24 1/4 September 34 21/64 September 52 5/8 September 54 13/16 September 50 5/8
October 22 27/64 October 35 27/64 October 52 45/64 October 64 1/2 October 59 7/16
November 24 59/64 November 39 November 56 51/64 November 64 1/2 November 53
December 26 43/64 December 34 59/64 December 60 11/64 December 68 3/16 December 46 11/16
</TABLE>
The closing price on June 22, 2000 was 45 9/16.
FIFTH THIRD BANCORP (FITB)
Fifth Third Bancorp is a bank holding company which provides commercial,
retail and trust banking services, data processing services, investment
services, leasing and insurance services. Fifth Third provides its financial
products and services, which include consumer banking and credit card services,
mortgage services and leasing, to the retail, commercial, financial,
governmental, educational and medical sectors. Fifth Third's operations are
primarily located in the midwestern United States.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- -------- --------- -------- --------- -------- --------- -------- --------- -------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 14 57/64 January 21 1/32 January 34 25/64 January 50 53/64 January 68 7/16 January 16 3/8
February 15 17/64 February 22 25/32 February 37 1/16 February 52 43/64 February 66 1/16 February 52 1/16
March 15 21/64 March 25 25/32 March 34 7/16 March 57 March 65 15/16 March 63
April 14 17/64 April 24 9/16 April 33 11/64 April 55 April 71 11/16 April 63 1/8
May 15 25/32 May 24 7/32 May 34 21/64 May 49 1/4 May 68 3/16 May 68
June 16 43/64 June 24 June 36 15/32 June 63 June 66 9/16
July 16 57/64 July 23 July 42 1/8 July 62 1/4 July 65 1/16
August 16 43/64 August 23 9/16 August 39 August 53 3/16 August 66 1/4
September 17 September 25 53/64 September 43 37/64 September 57 1/2 September 60 27/32
October 19 59/64 October 27 53/64 October 42 3/4 October 66 1/4 October 73 13/16
November 21 43/64 November 31 7/64 November 47 November 66 3/8 November 70
December 21 45/64 December 27 59/64 December 54 1/2 December 71 5/16 December 73 3/8
</TABLE>
The closing price on June 22, 2000 was 61 7/8.
A-3
<PAGE>
FIRSTAR CORPORATION (FSR)
Firstar Corporation is a bank holding company which provides a range of
financial services and activities, including traditional retail banking
services and credit card services. Firstar also provides trust and investment
management services to individuals and corporations. Firstar offers retail
brokerage services, trust and investment management services, residential
mortgages and insurance. Firstar's banking services are primarily located
throughout the midwestern United States.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- ------- --------- -------- --------- -------- --------- -------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 4 15/64 January 6 15/16 January 12 19/64 January 18 23/64 January 29 25/64 January 23 7/8
February 4 47/64 February 7 February 13 5/64 February 19 5/8 February 27 59/64 February 17 13/16
March 4 21/32 March 7 11/64 March 13 19/64 March 19 45/64 March 29 53/64 March 22 15/16
April 4 41/64 April 7 5/16 April 14 11/64 April 21 1/16 April 30 1/16 April 24 7/8
May 4 13/16 May 7 23/32 May 13 3/4 May 20 21/64 May 28 13/16 May 25 9/16
June 5 7/64 June 7 31/64 June 14 5/64 June 21 19/64 June 28
July 5 39/64 July 8 21/64 July 15 11/16 July 23 13/64 July 26 1/16
August 5 57/64 August 8 3/4 August 15 1/16 August 18 19/64 August 26 13/16
September 5 15/16 September 9 29/64 September 15 5/16 September 22 3/64 September 25 5/8
October 6 5/32 October 10 October 16 23/64 October 25 13/64 October 29 3/8
November 6 21/32 November 10 5/16 November 18 November 24 27/64 November 26
December 6 39/64 December 10 13/64 December 19 1/8 December 31 December 21 1/8
</TABLE>
The closing price on June 22, 2000 was 22 3/16.
FIRST UNION CORPORATION (FTU)
First Union Corporation is a bank holding company and a financial holding
company which engages in a range of financial services. In addition to
providing commercial, retail banking and trust services, First Union provides
various other financial services, including mortgage banking, home equity
lending, leasing, investment banking, insurance and securities brokerage. First
Union operates primarily on the east coast of the United States.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- -------- --------- -------- --------- -------- --------- -------- --------- -------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 21 3/8 January 28 15/16 January 41 13/16 January 47 7/8 January 52 1/2 January 33 7/16
February 22 5/16 February 30 1/4 February 43 7/8 February 52 5/8 February 53 5/16 February 29 1/2
March 21 11/16 March 30 3/16 March 40 9/16 March 56 13/16 March 53 7/16 March 37 1/4
April 22 5/8 April 30 3/4 April 42 April 60 3/8 April 55 1/8 April 31 7/8
May 24 1/2 May 30 9/16 May 42 15/16 May 55 1/4 May 46 3/16 May 35 3/16
June 22 5/8 June 30 7/16 June 46 1/4 June 58 1/4 June 47 1/8
July 24 7/16 July 31 3/4 July 50 23/32 July 60 1/4 July 46
August 25 1/16 August 31 15/16 August 48 1/16 August 48 1/8 August 41 1/2
September 25 1/2 September 33 3/8 September 50 1/16 September 51 3/16 September 35 5/8
October 24 13/16 October 36 3/8 October 49 1/16 October 58 October 42 3/4
November 27 5/16 November 38 3/16 November 48 3/4 November 60 3/4 November 38 3/4
December 27 13/16 December 37 December 51 1/4 December 60 13/16 December 32 15/16
</TABLE>
The closing price on June 22, 2000 was 28 3/4.
A-4
<PAGE>
FLEETBOSTON FINANCIAL CORPORATION (FBF)
FleetBoston Financial Corporation is a financial services company engaged
in the commercial banking and investment management business. FleetBoston
provides a variety of financial services, including institutional and
investment banking, cash management, trade services, mortgage banking, discount
brokerage services and other retail financial services. FleetBoston primarily
operates in the northeastern United States and Latin America.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- -------- --------- -------- --------- -------- --------- -------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 15 3/4 January 20 January 27 January 35 13/16 January 44 5/16 January 31 7/16
February 15 9/16 February 20 9/16 February 30 1/2 February 39 13/32 February 42 15/6 February 27 1/4
March 16 3/16 March 20 1/4 March 28 9/16 March 42 17/32 March 37 5/8 March 36 1/2
April 16 3/8 April 21 1/2 April 30 1/2 April 43 3/16 April 43 /16 April 35 9/16
May 17 7/16 May 22 1/16 May 30 9/16 May 41 May 41 1/8 May 37 13/16
June 18 9/16 June 21 3/4 June 31 5/8 June 41 3/4 June 44 3/8
July 17 13/16 July 20 1/4 July 33 27/32 July 42 31/32 July 40 1/2
August 18 1/2 August 20 7/8 August 32 1/4 August 32 25/32 August 39 13/16
September 18 7/8 September 22 1/4 September 32 25/32 September 36 23/32 September 36 5/8
October 19 3/8 October 24 15/16 October 32 5/32 October 40 October 43 5/8
November 20 7/8 November 27 11/16 November 33 1/16 November 41 11/16 November 37 13/16
December 20 3/8 December 24 15/16 December 37 9/16 December 44 11/16 December 34 13/16
</TABLE>
The closing price on June 22, 2000 was 38.
KEYCORP (KEY)
KeyCorp is a financial services company which, through its subsidiaries,
provides a wide range of investment management, retail and commercial banking,
consumer finance and investment banking products and services to corporate,
individual and institutional clients. In addition to the traditional banking
services, KeyCorp also provides specialized services, including personal and
corporate trust services, personal financial services, mutual fund services,
cash management services, investment banking and capital markets products and
international banking services. KeyCorp provides services throughout the United
States.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- -------- --------- -------- --------- -------- --------- -------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 13 15/16 January 18 5/16 January 26 3/16 January 32 1/2 January 31 7/8 January 21
February 14 1/2 February 18 13/16 February 26 3/4 February 35 1/32 February 32 1/4 February 16 15/16
March 14 1/8 March 19 5/16 March 24 3/8 March 37 13/16 March 30 5/16 March 19
April 13 3/8 April 19 5/16 April 26 1/16 April 39 3/4 April 51 15/16 April 18 1/2
May 15 1/4 May 19 3/8 May 27 3/16 May 37 15/16 May 34 3/4 May 21
June 15 11/16 June 19 3/8 June 27 15/16 June 35 5/8 June 32 1/8
July 16 July 19 5/16 July 31 3/32 July 34 July 31 1/2
August 15 1/2 August 20 1/16 August 30 5/16 August 25 1/2 August 29
September 17 1/8 September 22 September 31 13/32 September 28 7/8 September 25 13/16
October 16 7/8 October 23 5/16 October 30 19/32 October 30 5/16 October 27 15/16
November 18 7/16 November 26 3/16 November 33 23/32 November 30 11/16 November 27
December 18 1/8 December 25 1/4 December 35 13/32 December 32 December 22 1/8
</TABLE>
The closing price on June 22, 2000 was 18 3/4.
A-5
<PAGE>
MARSHALL & ILSLEY CORPORATION (MI)
Marshall & Ilsley Corporation is a bank holding company which, through
its subsidiaries, provides banking services that include retail, institutional
and business banking, investment and trust services. In addition, M&I's
affiliates provide investment management services, insurance services, trust
services, equipment lease financing, commercial and residential mortgage
banking, venture capital, brokerage services and financial advisory services.
M&I operates primarily in Wisconsin, Illinois, Arizona, Florida and Nevada.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- ------- --------- ------- --------- ------- --------- -------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 19 1/4 January 25 1/2 January 38 January 55 5/8 January 59 1/4 January 51 1/4
February 20 3/4 February 24 7/8 February 39 1/2 February 55 5/8 February 56 February 45 15/16
March 21 March 26 1/8 March 36 1/2 March 58 1/8 March 55 7/16 March 57 3/4
April 20 1/8 April 27 April 38 3/8 April 58 1/2 April 70 April 46 7/16
May 21 9/16 May 27 1/2 May 39 7/8 May 54 May 70 May 48 1/2
June 22 5/8 June 27 3/4 June 40 5/8 June 51 1/16 June 64 3/8
July 23 1/8 July 26 1/4 July 42 7/8 July 56 3/16 July 64 5/8
August 25 1/4 August 27 1/2 August 47 August 44 August 58 9/16
September 25 1/8 September 30 1/8 September 50 5/8 September 47 3/4 September 57 1/16
October 24 1/4 October 32 1/8 October 51 7/8 October 48 3/4 October 67 1/8
November 26 3/8 November 34 November 53 1/8 November 50 15/16 November 66 15/16
December 26 December 34 5/8 December 62 1/8 December 58 7/16 December 62 13/16
</TABLE>
The closing price on June 22, 2000 was 43 15/16.
MELLON FINANCIAL CORPORATION (MEL)
Mellon Financial Corporation is a financial holding company which
provides a range of financial services and products. Mellon provides retail and
commercial banking services, wealth management and global investment management
services for individual and institutional investors, global investment services
for businesses and institutions and mutual fund management services. Mellon's
regional banking services are primarily offered in the mid-Atlantic region of
the United States.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- -------- --------- -------- --------- -------- --------- -------- --------- -------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 8 3/4 January 13 3/16 January 18 21/32 January 30 3/16 January 33 1/2 January 34 5/16
February 9 17/32 February 13 31/32 February 20 3/32 February 31 5/32 February 33 13/16 February 30 1/8
March 10 3/16 March 13 13/16 March 18 3/16 March 31 3/4 March 35 3/16 March 29 3/4
April 91 3/16 April 13 7/16 April 20 25/32 April 36 April 37 5/32 April 32 1/8
May 10 11/16 May 14 9/32 May 21 7/8 May 33 23/32 May 35 11/16 May 38 5/8
June 10 13/32 June 14 1/4 June 22 9/16 June 34 27/32 June 36 3/8
July 10 1/32 July 13 3/16 July 25 7/32 July 33 11/16 July 33 3/4
August 11 27/32 August 13 27/32 August 24 1/16 August 26 August 33 3/8
September 11 3/16 September 14 13/16 September 27 3/8 September 27 1/2 September 33 5/8
October 12 1/2 October 16 1/4 October 26 October 30 1/16 October 36 15/16
November 13 15/32 November 18 1/16 November 28 11/32 November 31 19/32 November 36 7/16
December 13 7/16 December 17 3/4 December 30 5/16 December 34 3/8 December 34 1/16
</TABLE>
The closing price on June 22, 2000 was 36 1/4.
A-6
<PAGE>
NATIONAL CITY CORPORATION (NCC)
National City Corporation is a bank holding company engaged in a variety
of financial services. In addition to providing general retail and commercial
banking services, National City provides retail sales and distribution,
consumer finance, asset management and mortgage processing. National City
primarily operates in Ohio, Kentucky, Illinois, Indiana, Michigan and
Pennsylvania.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- -------- --------- -------- --------- -------- --------- -------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 13 1/4 January 16 5/16 January 22 11/16 January 30 3/32 January 35 17/32 January 21 11/16
February 13 7/8 February 17 3/8 February 25 1/4 February 32 5/8 February 34 15/16 February 19 1/4
March 13 5/16 March 17 9/16 March 23 5/16 March 36 21/32 March 33 3/16 March 20 5/8
April 13 11/16 April 18 7/16 April 24 3/8 April 34 5/8 April 35 7/8 April 17
May 15 3/16 May 17 13/16 May 25 3/4 May 33 7/8 May 33 3/32 May 20
June 14 11/16 June 17 9/16 June 26 1/4 June 35 1/2 June 32 3/4
July 15 5/16 July 17 5/16 July 29 3/4 July 33 7/16 July 29 3/4
August 14 7/8 August 18 13/16 August 28 1/4 August 29 3/8 August 27 5/8
September 15 7/16 September 21 1/16 September 30 25/32 September 32 31/32 September 26 11/16
October 15 7/16 October 21 11/16 October 29 7/8 October 32 5/32 October 29 1/2
November 16 3/16 November 23 3/16 November 33 3/8 November 33 5/8 November 24 15/16
December 16 9/16 December 22 7/16 December 32 7/8 December 36 1/4 December 23 11/16
</TABLE>
The closing price on June 22, 2000 was 18.
NORTHERN TRUST CORPORATION (NTRS)
Northern Trust Corporation is a bank holding company that provides trust
services, retail and commercial banking, treasury management services,
securities lending, asset management services and financial record keeping.
Northern Trust operates banking subsidiaries in Arizona, California, Colorado,
Florida, Texas and Michigan, trust companies in Connecticut and New York and
various other non-bank subsidiaries, including a securities brokerage firm, a
registered investment adviser and a retirement services company.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- -------- --------- -------- --------- ------- --------- -------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 8 1/4 January 13 1/4 January 20 1/2 January 33 11/16 January 43 9/32 January 60 3/8
February 8 1/2 February 13 3/16 February 21 1/4 February 38 1/32 February 44 11/16 February 56 1/2
March 8 25/32 March 13 1/2 March 18 3/4 March 37 3/8 March 44 13/32 March 67 9/16
April 9 9/64 April 14 1/16 April 22 1/4 April 36 1/2 April 46 9/16 April 64 1/8
May 9 11/16 May 13 11/16 May 24 9/16 May 35 17/64 May 45 3/16 May 65 13/16
June 10 1/16 June 14 7/16 June 24 3/16 June 38 1/8 June 48 1/2
July 9 31/32 July 14 25/32 July 27 1/2 July 36 13/16 July 43 1/2
August 11 1/4 August 16 13/32 August 26 9/16 August 27 7/8 August 42 13/32
September 11 1/2 September 16 7/16 September 29 9/16 September 34 1/8 September 41 3/4
October 11 15/16 October 17 5/16 October 29 1/4 October 36 7/8 October 48 9/32
November 13 1/16 November 18 5/32 November 31 1/8 November 40 3/8 November 48 13/32
December 14 December 18 1/8 December 34 7/8 December 43 21/32 December 53
</TABLE>
The closing price on June 22, 2000 was 69 3/8.
A-7
<PAGE>
THE PNC FINANCIAL SERVICES GROUP, INC. (PNC)
The PNC Financial Services Group, Inc. is a bank holding company and a
financial holding company. PNC operates regional retail banking, wholesale
banking and asset management businesses that provide financial products and
services locally and nationally. PNC's primary geographic markets include
Pennsylvania, New Jersey, Delaware, Ohio and Kentucky.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- ------- --------- ------- --------- -------- --------- -------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 23 1/2 January 30 January 39 3/4 January 51 9/6 January 51 3/16 January 48
February 25 1/2 February 30 5/8 February 42 1/4 February 55 1/2 February 52 1/16 February 38 11/16
March 24 3/8 March 30 3/4 March 40 March 59 15/16 March 55 9/16 March 45 1/16
April 25 1/8 April 30 1/4 April 41 1/8 April 60 7/16 April 57 7/8 April 43 5/8
May 27 May 30 3/8 May 41 7/8 May 57 3/4 May 57 1/4 May 50 3/16
June 26 3/8 June 29 3/4 June 41 3/4 June 53 7/8 June 57 5/8
July 24 3/4 July 29 1/8 July 45 3/4 July 53 15/16 July 52 7/8
August 26 1/4 August 31 1/4 August 43 1/4 August 43 August 52 5/16
September 27 7/8 September 33 3/8 September 48 13/16 September 45 September 52 11/16
October 26 1/4 October 36 1/4 October 47 1/2 October 50 October 59 5/8
November 29 1/4 November 39 1/2 November 53 13/16 November 51 9/16 November 55 3/4
December 32 1/4 December 37 5/8 December 56 15/16 December 54 December 44 1/2
</TABLE>
The closing price on June 22, 2000 was 51 9/16.
STATE STREET CORPORATION (STT)
State Street Corporation is a bank holding company specializing in
serving institutional investors such as mutual funds. Services for
institutional investors include foreign exchange, cash management, securities
lending, fund administration, daily pricing, portfolio accounting, banking
services and deposit and short-term investment facilities. State Street also
provides investment management and commercial lending services. State Street
operates offices throughout the United States.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- -------- --------- -------- --------- -------- --------- -------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 16 7/16 January 22 11/16 January 36 9/16 January 56 January 71 1/2 January 80 3/16
February 15 15/16 February 22 5/8 February 40 3/16 February 61 13/16 February 76 11/16 February 72 7/8
March 15 15/16 March 25 March 34 11/16 March 68 1/16 March 82 1/4 March 96 7/8
April 15 7/8 April 24 15/16 April 39 3/8 April 71 1/2 April 87 1/2 April 96 7/8
May 16 13/16 May 26 1/16 May 44 5/8 May 68 15/16 May 76 1/4 May 111 1/2
June 18 7/16 June 25 1/2 June 46 1/4 June 69 1/2 June 85 3/8
July 17 11/16 July 25 1/8 July 56 1/16 July 69 7/16 July 70 7/8
August 18 7/16 August 27 1/16 August 49 7/8 August 52 1/16 August 59 7/8
September 20 September 28 11/16 September 60 15/16 September 54 9/16 September 64 5/8
October 19 1/2 October 31 11/16 October 55 3/4 October 62 3/8 October 76 1/8
November 22 1/2 November 33 13/16 November 59 1/2 November 68 5/8 November 73 7/16
December 22 1/2 December 32 5/16 December 58 3/16 December 70 1/8 December 73 1/16
</TABLE>
The closing price on June 22, 2000 was 103 7/16.
A-8
<PAGE>
SUNTRUST BANKS, INC. (STI)
SunTrust Banks, Inc. is a bank holding company which provides consumer
and commercial banking services, including traditional deposit and credit
services and trust and investment services. SunTrust offers credit cards,
mortgage services, insurance, data processing and information services,
discount brokerage and investment banking services. SunTrust's operations are
located primarily in the southern United States.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- -------- --------- -------- --------- -------- --------- -------- --------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 25 15/16 January 34 9/16 January 50 January 69 1/4 January 70 7/16 January 59 9/16
February 26 15/16 February 35 15/16 February 51 3/8 February 73 3/4 February 67 15/16 February 50 13/16
March 26 3/4 March 35 March 46 3/8 March 75 3/8 March 62 1/4 March 57 3/4
April 27 1/8 April 35 1/4 April 50 3/4 April 81 7/16 April 71 1/2 April 50 3/4
May 29 May 36 1/2 May 53 3/8 May 79 May 67 1/2 May 59 3/4
June 29 1/8 June 37 June 55 1/16 June 81 5/16 June 69 7/16
July 30 3/16 July 36 3/4 July 64 3/16 July 73 July 64 1/2
August 30 11/16 August 38 3/8 August 62 1/2 August 56 1/16 August 64 5/16
September 33 1/16 September 41 September 67 15/16 September 62 September 65 3/4
October 32 1/4 October 46 5/8 October 64 13/16 October 69 11/16 October 73 3/16
November 34 1/8 November 50 3/4 November 71 November 69 13/16 November 69 7/8
December 34 1/4 December 49 1/4 December 71 3/8 December 76 1/2 December 68 13/16
</TABLE>
The closing price on June 22, 2000 was 49 7/8.
SYNOVUS FINANCIAL CORP. (SNV)
Synovus Financial Corp. is a bank holding company that provides a range
of financial services. Synovus is primarily engaged in commercial, mortgage and
retail banking, trust, securities brokerage and insurance services. Synovus is
also engaged in transaction processing which includes credit, debit, commercial
and retail card processing and related services and debt collection and
bankruptcy management services. Synovus primarily offers its banking services
in the southeastern United States.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- ------- --------- -------- --------- -------- --------- -------- --------- -------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 5 31/64 January 8 21/64 January 14 7/16 January 21 61/64 January 24 7/8 January 19
February 5 55/64 February 8 43/64 February 15 1/2 February 23 1/2 February 23 13/16 February 16 3/8
March 5 25/32 March 10 March 13 7/64 March 24 3/4 March 20 1/2 March 16 7/8
April 6 7/64 April 10 April 16 11/64 April 23 29/64 April 22 1/8 April 18 9/16
May 6 7/32 May 10 7/32 May 17 11/64 May 22 7/16 May 20 1/8 May 20
June 6 47/64 June 9 39/64 June 18 3/8 June 23 3/4 June 19 7/8
July 7 9/64 July 10 11/64 July 18 51/64 July 22 1/4 July 18 5/16
August 7 9/16 August 10 39/64 August 17 29/64 August 18 3/16 August 18 13/16
September 7 47/64 September 11 9/16 September 14 53/64 September 19 3/4 September 18 11/16
October 7 33/64 October 13 9/32 October 14 1/2 October 23 3/16 October 21 7/16
November 8 19/32 November 14 9/16 November 21 19/64 November 22 1/16 November 20
December 8 7/16 December 14 9/32 December 21 53/64 December 24 December 19 7/8
</TABLE>
The closing price on June 22, 2000 was 18.
A-9
<PAGE>
U.S. BANCORP (USB)
U.S. Bancorp is a bank holding company engaged in a general retail and
commercial banking business through which it provides a variety of financial
services to individuals, businesses, government entities and other financial
institutions. U.S. Bancorp's bank and trust subsidiaries provide a range of
fiduciary activities for individuals, estates, foundations, corporations and
charitable organizations. U.S. Bancorp also provides investment services, data
processing, leasing and brokerage services. U.S. Bancorp primarily operates in
the midwestern and western United States.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- -------- --------- -------- --------- -------- --------- -------- --------- -------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 12 3/64 January 17 1/2 January 25 21/64 January 36 1/2 January 33 11/16 January 22 3/16
February 12 61/64 February 19 13/64 February 26 11/64 February 38 23/64 February 32 5/16 February 18 5/16
March 13 29/64 March 19 7/8 March 24 21/64 March 41 37/64 March 34 1/16 March 21 7/8
April 13 1/2 April 20 5/64 April 25 37/64 April 42 21/64 April 37 1/16 April 20 5/16
May 14 May 20 1/8 May 27 21/64 May 39 1/8 May 32 1/2 May 26
June 13 43/64 June 19 21/64 June 28 29/64 June 43 June 33 3/8
July 14 29/64 July 20 27/64 July 29 43/64 July 46 July 31 1/8
August 15 13/64 August 21 27/64 August 29 3/16 August 34 1/8 August 30 7/8
September 16 3/64 September 22 19/64 September 32 11/64 September 35 5/8 September 30 3/16
October 16 37/64 October 22 October 33 57/64 October 36 7/16 October 37 1/16
November 17 13/64 November 24 19/64 November 35 51/64 November 37 November 34 3/16
December 16 35/64 December 22 3/4 December 37 5/16 December 35 1/2 December 23 13/16
</TABLE>
The closing price on June 22, 2000 was 20 5/8.
WACHOVIA CORPORATION (WB)
Wachovia Corporation is a bank holding company which provides a variety
of consumer and business banking products and services, credit card services
and treasury and trust administration and investment services. Wachovia
primarily offers its services in Florida, Georgia, North Carolina, South
Carolina and Virginia.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- ------- --------- ------- --------- ------- --------- -------- --------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 33 5/8 January 44 3/4 January 57 5/8 January 77 3/4 January 88 5/8 January 64 1/16
February 34 3/4 February 46 1/2 February 60 7/8 February 79 1/2 February 85 1/16 February 57 3/16
March 35 1/2 March 44 3/4 March 54 1/2 March 84 13/16 March 81 3/16 March 67 9/16
April 35 1/8 April 44 April 58 1/2 April 84 15/16 April 87 7/8 April 62 11/16
May 37 7/8 May 42 7/8 May 60 7/8 May 80 1/16 May 88 1/4 May 69 1/8
June 35 3/4 June 43 3/4 June 58 5/16 June 84 1/2 June 85 9/16
July 38 1/8 July 44 1/4 July 64 1/2 July 85 3/8 July 78 1/16
August 39 3/4 August 45 3/4 August 62 1/4 August 73 5/16 August 78 3/8
September 43 1/8 September 49 1/2 September 72 September 85 1/4 September 78 5/8
October 44 1/8 October 53 3/4 October 75 5/16 October 90 7/8 October 86 1/4
November 45 November 60 November 77 November 87 5/16 November 77 7/16
December 45 3/4 December 56 1/2 December 81 1/8 December 87 7/16 December 68
</TABLE>
The closing price on June 22, 2000 was 56 5/16.
A-10
<PAGE>
WELLS FARGO & CO. (WFC)
Wells Fargo & Co. is a financial services company and a bank holding
company which engages in retail, commercial and corporate banking activities.
Wells Fargo also engages in mortgage banking, leasing, securities brokerage,
venture capital and investment banking activities and trust services. Wells
Fargo primarily operates in the midwestern and western United States.
<TABLE>
<CAPTION>
Closing Closing Closing Closing Closing Closing
1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price
--------- -------- --------- -------- --------- -------- --------- -------- --------- -------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 12 January 17 3/16 January 23 13/16 January 36 7/16 January 35 January 40
February 12 7/8 February 18 1/4 February 24 7/8 February 41 February 36 3/4 February 33 1/16
March 12 11/16 March 18 3/8 March 23 1/8 March 41 9/16 March 35 1/16 March 40 3/4
April 13 1/4 April 18 1/16 April 24 15/16 April 39 7/8 April 43 3/16 April 41 1/16
May 14 3/16 May 17 7/16 May 26 3/4 May 38 7/8 May 40 May 45 1/4
June 14 3/8 June 17 7/16 June 28 1/8 June 37 1/2 June 42 3/4
July 14 1/8 July 17 3/4 July 31 17/32 July 36 1/8 July 39
August 15 1/16 August 18 13/16 August 28 23/32 August 29 3/4 August 39 13/16
September 16 1/4 September 20 3/8 September 30 5/8 September 36 September 39 5/8
October 14 3/4 October 21 15/16 October 32 1/16 October 37 3/16 October 47 7/8
November 16 1/2 November 23 3/8 November 37 7/16 November 36 1/8 November 46 1/2
December 16 1/2 December 21 3/4 December 38 3/4 December 39 15/16 December 40 7/16
</TABLE>
The closing price on June 22, 2000 was 39 13/16.
A-11
<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
[LOGO OF REGIONAL BANKS HOLDRS]
1,000,000,000 Depositary Receipts
Regional Bank HOLDRSSM Trust
---------------------
P R O S P E C T U S
---------------------
Merrill Lynch & Co.
A.G. Edwards & Sons, Inc.
June 22, 2000
Until July 17, 2000 (25 days after the date of this prospectus), all
dealers effecting transactions in the offered Regional Bank HOLDRS, whether or
not participating in this distribution, may be required to deliver a
prospectus. This requirement is in addition to the obligations of dealers to
deliver a prospectus when acting as underwriters and with respect to unsold
allotments or subscriptions.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
