<PAGE>
Registration No. 2-98383
S E C U R I T I E S A N D E X C H A N G E C O M M I S
S I O
N
Washington, D.C. 20549
POST-EFFECTIVE AMENDMENT NO. 10
to
F O R M S-6
FOR REGISTRATION UNDER THE SECURITIES ACT OF
1933
OF SECURITIES OF UNIT INVESTMENT TRUSTS
REGISTERED ON FORM N-8B-2
A. Exact Name of Trust:
SMITH BARNEY INC. STRIPPED ("ZERO")
U.S. TREASURY SECURITIES FUND, SERIES A
(formerly The Smith Barney Shearson Stripped
U.S. Treasury Securities Fund, Series A)
B.
Name of Depositor:
SMITH BARNEY INC.
<TABLE>
<S> <C>
C. Complete address of depositor's principal executive
office:
388 Greenwich Street
New York, New York 10013
D. Names and complete addresses of agents for service:
THOMAS D. HARMAN, ESQ. Copy to:
Smith Barney PIERRE DE ST. PHALLE,ESQ.
Incorporated Davis Polk & Wardwell
388 Greenwich Street 450 Lexington Avenue
New York, New York 10013 New York, New York 10017
</TABLE>
The issuer has registered an indefinite number of Units pursuant to
Rule 24f-2 under the Investment Company Act of 1940, as amended,
and filed its Rule 24f-2 Notice for the year ended December 31, 1994
on February 22, 1995.
It is proposed that this filing will become effective May 2,
1995
pursuant to paragraph (b) of Rule 485.
<PAGE>
<PAGE>
THE SMITH BARNEY INC.
STRIPPED ("ZERO")
U.S. TREASURY SECURITIES FUND, SERIES A
(A Guardian Insurance & Annuity Company, Inc. Separate Account
Investment)
May 2, 1995
Prospectus - Part A
This Prospectus consists of two parts. Part A consists of an
Investment Summary relating to the Trusts of Series A of the Fund,
a statement of financial condition and a statement of operations
and changes in net assets for each Trust and a summary of each
Trust's portfolio. Part B contains a general description of the
Fund. Part A may not be distributed unless accompanied by Part
B.
The Smith Barney Inc. Fund of Stripped ("Zero") U.S.
Treasury Securities Fund (the "Fund") was formed for the purpose
of providing, when the units issued by it are held to maturity of the
underlying securities, safety of capital and income through
investment in portfolios consisting of debt obligations of the United
States of America (the "Securities"). Series A of the Fund
originally consisted of three separate unit investment trusts
designated as the 1991 Trust, the 1995 Trust and the 2004 Trust
(the "Trusts") holding Securities with maturities corresponding to
their respective designations. The 1991 Trust expired on November
15, 1991. Substantially all of the Securities in each Trust are debt
obligations of the United States of America which have been
stripped of their unmatured interest coupons, coupons stripped
from debt obligations of the United States of America and receipts
and certificates for such stripped debt obligations and stripped
coupons ("Stripped Treasury Securities"). The remaining Securities
in each Trust consist of interest-bearing debt obligations of the
United States of America ("Treasury Notes") deposited to provide
income for payment of Trust expenses.
Stripped Treasury Securities do not make any periodic
payments of interest prior to their maturities; accordingly, each
Trust's portfolio was acquired at a deep discount. There is no
assurance that the objectives of safety of capital and income will be
met if the units of fractional undivided interest in a Trust (the
"Units") are sold prior to the maturity of the underlying Securities
in that Trust, as market prices of the Securities before maturity,
and therefore of the Units, will vary with changes in interest rates
and other factors. Moreover, the value of Stripped Treasury
Securities, and hence of the Units, will be subject to greater
fluctuations in response to changing interest rates than the value of
debt obligations making periodic distributions of interest.
The offering price of the Units of each Trust is calculated
on the basis of the aggregate offering side evaluation of the
underlying Securities in that Trust, plus a transaction charge of 1.50
percent or less of the price so determined (the "Offering Price").
The Sponsor has undertaken to maintain a secondary market for
Units of each Trust, also at a price based upon the aggregate
offering side evaluation of the underlying Securities (the "Sponsor's
Repurchase Price").
The Guardian Separate Account B (the "Account") of The
Guardian Insurance & Annuity Company, Inc. ("GIAC") is
currently the only eligible purchaser of Units of each Trust from
the Sponsor. The Account invests in Units of the Trusts to fund
benefits under Variable Life Insurance Policies issued by GIAC
(the "Policies") in accordance with allocation instructions received
from purchasers of Policies. These allocation rights are further
described in the accompanying Prospectus for the Policies. The
rights described in this Prospectus of the Account and the Sponsor
(insofar as it holds Units) as holders of Units should be
distinguished from the rights of a Policy owner set forth in the
accompanying Prospectus describing the Policies.
Read and retain both parts of this Prospectus for future
reference.
THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES COMMISSION,
NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
Smith Barney Inc.
Sponsor
A-1
<PAGE>
<PAGE>
<TABLE>
SMITH BARNEY INC. UNIT TRUSTS, STRIPPED
("ZERO")
U.S. TREASURY SECURITIES FUND, SERIES A
INVESTMENT SUMMARY AS OF DECEMBER 31, 1994
Series A consists of two separate unit investment trusts, the
1995 Trust and the 2004 Trust, designated for the maturities
of their respective underlying portfolios.
19952004
Trust Trust
<S> <C> <C>
Face amount of securities$8,965,720$11,033,960
Number of units 8,965,72011,033,960
Fractional undivided interest in trust represented by each
unit 1/8,965,7201/11,033,960
Offering price per 1,000 units*
Aggregated offering side evaluation of securities in
trust**$8,460,237$5,171,372
Divided by number of units times 1,000$943.620
$468.677
Plus the applicable transaction charge*** 4.746
7.137
Offering price per 1,000 units*$948.366$475.814
Sponsor's repurchase price per 1,000 units (based on
offering side evaluation of underlying securities)$943.620
$468.677
Redemption price per 1,000 units (based on bid side
evaluation of underlying securities)****$943.020$468.108
Calculation of estimated net annual interest income from
Treasury Notes per 1,000 units
Gross annual income per 1,000 units $ .46$ .46
Less estimated annual expenses per 1,000 units .46
.46
Net annual income per 1,000 units $0.00$0.00
Distributions
Distributions will be made on the first business day
following the
maturity of securities in a trust to holders of record on
the business
day immediately preceding the date of such distribution
Trustee's monthly fee
Per $1,000 face amount of underlying securities
(see "Expenses and Charges" in Part B)$.025$.025
Evaluator's fee for each evaluation: $5.00
Evaluation time: 3:00 P.M., New York Time, on each
Business Day
Mandatory termination date: January 1, 2036
Minimum value of fund
Any Trust may be liquidated by the Trustee if the value
of that Trust is less than 40% of the principal amount of
Securities held in such Trust on the Initial Date of Deposit.
<FN>
* These figures are computed by dividing the aggregate
offering side evaluation of the underlying Securities in
the particular Trust (the price at which they could be
purchased directly by the public if available) by the
number of Units of the Trust outstanding, multiplying
the result times 1,000 and adding the applicable
transaction charge as described below. These figures
assume a purchase of 1,000 Units. The price of a single
Unit, or any multiple thereof, is calculated simply by
dividing the Offering Price per 1,000 Units above by
1,000, and multiplying by the number of Units.
** These figures include amortization of discount on the
Stripped Treasury Securities accreting to the expected
date of settlement (normally five Business Days after
purchase) for Units as if purchased on their date of
deposit. Interest on the Treasury Notes accruing to the
date five Business Days after deposit of such Notes will
be paid by the Trustee to the Sponsor as a special
distribution and recovered by the Trustee from
subsequent payments of interest on the Treasury Notes
in the Trust, and is therefore not included in the
evaluation of Securities in a Trust. See "Sale and
Redemption of Units - Pricing of Units" in Part B.
*** The transaction charges currently applicable to the 1995
Trust and the 2004 Trust are 0.5% and 1.50 of their
respective Offering Prices per 1,000 Units (0.503% and
1.523%, respectively, of the net amount invested in
Securities). Transaction charges will decrease as the
Trusts approach maturity. See "Sale and Redemption
of Units - Sale of Units" in Part B. On August 4, 1986,
an Account purchased from the Sponsor all of the Units
of each Trust issued on that date in a private placement
and Sponsor waived all transaction charges in
connection with such purchase.
**** Figures shown are $5.346 and $7.706 less than the
Offering Price per 1,000 Units and $.600 and $.577 less
than the Sponsor's Repurchase Price per 1,000 Units,
with respect to the 1995 Trust and the 2004 Trust,
respectively.
Plus any cash on hand, accrued interest on Treasury
Notes and all other assets of the Trust less any accrued
expenses and any distribution payable to Holders. See
"Sale and Redemption of Units - Pricing of Units" in
Part B.
</TABLE>
A-2<PAGE>
<PAGE>
DESCRIPTION OF THE FUND
Structure and Offering
The objective of the Fund is to provide safety of capital
and income through investment in portfolios consisting
primarily of Stripped Treasury Securities. Each of the Trusts
constituting Series A of the Fund consists of Stripped
Treasury Securities with maturities of approximately 1 1/2 and
10 1/2 years, respectively, and Treasury Notes deposited in
order to provide income with which to pay anticipated
expenses of each Trust. The Sponsor intends to deposit
additional Stripped Treasury Securities, with maturities
identical to those of the Securities described in the portfolio
of each Trust below, in each of the Trusts. Additional
Treasury Notes with maturities identical to those of the Notes
described in the portfolio of each Trust will be deposited to
the extent necessary to maintain a constant proportion of
Treasury Notes to Stripped Treasury Securities in each of the
Trusts. See "Description of the Fund - Structure" in Part B
of this Prospectus.
It is expected that for each 1,000 Units of a Trust
purchased, a Holder will receive total distributions of
approximately $1,000 for Units held until maturity of the
underlying Securities of that Trust. Actual distributions may
be more or less than this amount, however, as a result of
changes in the expenses incurred by a Trust or sales of
Securities held by a Trust prior to maturity in order to meet
redemptions of Units. See "Sale and Redemption of Units,"
"Expenses and Charges" and "Administration of the Fund -
Accounts and Distributions" in Part B.
Currently, Units are sold only to the Account to fund
benefits under Policies issued by GIAC. The interest of a
Policy owner in the Units is subject to the terms of the Policy
and is described in the accompanying Prospectus for the
Policies, which should be reviewed carefully by a person
considering the purchase of a Policy. That Prospectus
describes the relationship between increases or decreases in
the net asset value of, and any distributions on, Units and the
benefits provided under a Policy. The rights described in this
Prospectus of the Account and the Sponsor (insofar as it
holds Units) as holders of Units should be distinguished from
the rights of a Policy owner set forth in the Prospectus
describing the Policies. For purposes of this Prospectus, the
term "Holder" shall refer to the Account or, when
appropriate, the Sponsor. GIAC and the Sponsor may
mutually agree to terminate the offering of Units of any Trust
at any time.
Risk Factors
An investment in Units of a Trust should be made with
an understanding of the risks that such an investment may
entail, including the risk that the value of the Units will
decline with increases in interest rates. Unlike an investor in
funds comprised of securities making periodic distributions,
an investor in the Fund virtually eliminates the risk of being
unable to invest distributions at a rate as high as the
anticipated yield on Trust Units, but will forego the ability to
reinvest such yield at higher rates in the future. The market
value of the underlying Securities in a Trust prior to their
maturities, and therefore the value of the Units of that Trust,
will fluctuate with changes in interest rates and other factors.
Moreover, the value of obligations of a "zero coupon" nature,
such as the Stripped Treasury Securities underlying the Units,
and therefore of the Units, will be subject to greater
fluctuations in response to changing interest rates than the
value of debt obligations making periodic distributions of
interest. Accordingly, while the full faith and credit of the
United States Government protects against credit risks on the
Securities in each Trust, sales of Units before the maturity of
the underlying portfolio Securities at a time when interest
rates have increased will involve greater market risk than in
a trust which is invested in interest-bearing debt obligations.
This risk is greater when the period to maturity is longer. See
"Description of the Fund - Risk Factors" in Part B of this
Prospectus.
A-3<PAGE>
<PAGE>
Securities
Each Trust consists primarily of Stripped Treasury
Securities, which are debt obligations of the United States of
America that have been stripped of their unmatured interest
coupons, coupons stripped from debt obligations of the
United States of America and receipts and certificates for
such stripped debt obligations and stripped coupons. The
stripping of the interest coupons will cause the Stripped
Treasury Securities to be purchased by each Trust at a deep
discount. See "Description of the Fund - Characteristics of
the Securities" in Part B. Each Trust will also consist of a
Treasury Note or Notes providing interest income with which
to pay anticipated expenses of such Trust. The Securities are
not rated but, in the opinion of the Sponsor, have credit
characteristics comparable to those of Securities rated "AAA"
by nationally recognized rating agencies.
Distributions
There will be no periodic payments of interest on the
Securities other than interest on the Treasury Notes in each
Trust, which will be used to pay anticipated expenses of the
Trust holding such Notes. Consequently, there should be no
distributions of interest income. However, each Stripped
Treasury Security will be treated for Federal income tax
purposes as having "original issue discount," which must be
amortized over the term of the Stripped Treasury Security
and included in a Holder's gross income before the Holder
receives the cash attributable to such income. Distributions
will be made in cash when the Securities in each Trust
mature, and may include any amount received on the sale of
Securities in order to redeem Units which exceeds the amount
necessary to meet such redemptions. See "Administration of
the Fund - Accounts and Distributions" and "Taxes" in Part B.
Market For Units
The Sponsor has undertaken to maintain a secondary
market for Units of each Trust based on the offering side
evaluation of the underlying Securities. In the absence of
such a market, a Holder will nonetheless be able to dispose
of Units through redemption at prices based on the bid side
evaluation of the underlying Securities of the Trust in which
it holds Units. Market conditions may cause the price
received upon resale to the Sponsor or redemption to be
more or less than the amount paid for Units. See "Sale and
Redemption of Units" in Part B.
A-4<PAGE>
<PAGE>
To the Sponsor and Holders of
The Smith Barney Fund of Stripped ("Zero")
U.S. Treasury Securities, Series A:
We have audited the accompanying statements of financial
condition of The Smith Barney Fund of Stripped ("Zero")
U.S. Treasury Securities, Series A, formerly The Smith Barney
Shearson Fund of Stripped ("Zero") U.S. Treasury Securities,
Series A (comprised of the 1995 Trust and the 2004 Trust),
including the related Portfolios, as of December31, 1994, and
the related statements of operations and changes in net assets
and the selected supplemental information for the year then
ended. These financial statements and supplemental
information are the responsibility of the Fund's management.
Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally
accepted auditing standards. Those standards require that we
plan and perform the audit to obtain reasonable assurance
about whether the financial statements and supplemental
information are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. Our
procedures included confirmations from the custodian of cash
and securities owned at December31, 1994. An audit also
includes assessing the accounting principles used and
significant estimates made by management, as well as
evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and supplemental
information referred to above present fairly, in all material
respects, the financial position of each of the respective Trusts
constituting The Smith Barney Fund of Stripped ("Zero") U.S.
Treasury Securities, Series A, formerly The Smith Barney
Shearson Fund of Stripped ("Zero") U.S. Treasury Securities,
Series A at December31, 1994, and the results of their
operations and the changes in their net assets and
supplemental information for the year then ended in
conformity with generally accepted accounting principles.
February 17, 1995
A-5
<PAGE>
REPORT ON INDEPENDENT ACCOUNTANTS
To the Sponsor and Holders of The Smith Barney Shearson
Fund of Stripped ("Zero") U.S. Treasury Securities, Series A:
We have audited the statements of financial condition
of THE SMITH BARNEY SHEARSON FUND of
STRIPPED ("Zero") U.S. TREASURY SECURITIES,
SERIES A, formerly The Shearson Lehman Brothers Fund of
Stripped ("Zero") U.S. Treasury Securities, Series A
(comprised of the 1995 Trust and the 2004 Trust) including
the related Portfolios, as of December 31, 1993 for each of
the Trusts and the related statements of operations and
changes in net assets and supplemental information for each
of the two years in the period ended December 31, 1993.
These financial statements and supplemental information are
the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally
accepted auditing standards. Those standards require that we
plan and perform the audits to obtain reasonable assurance
about whether the financial statements and supplemental
information are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. Our
procedures included confirmations from the custodian of cash
and securities owned at December 31, 1993. An audit also
includes assessing the accounting principles used and
significant estimates made by management, as well as
evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and
supplemental information referred to above present fairly, in
all material respects, the financial position of The Smith
Barney Shearson of Stripped ("Zero") U.S. Treasury
Securities, Series A at December 31, 1993 and the results of
its operations and the changes in its net assets and
supplemental information for each of the two years in the
period ended December 31, 1993, in conformity with generally
accepted accounting principles.
COOPERS & LYBRAND, L.L.P.
New York, New York
February 24, 1994
A-6<PAGE>
<PAGE>
<TABLE>
THE SMITH BARNEY FUND OF STRIPPED ("ZERO")
U.S. TREASURY SECURITIES, SERIES A
Statements of Financial Condition
December 31, 1994 and 1993
<S> <C><C>
19952004
TrustTrust
1994
Trust Property:
Investment in securities at value (amortized cost
$8,389,673 in 1995 Trust and $4,987,451 in
2004 Trust)$8,454,8585,165,082
Other assets5426,510
$8,455,4005,171,592
Interest of Holders: 8,965,720 units in 1995 Trust and
11,033,960 units in 2004 Trust of fractional undivided
interest outstanding:
Cost of Trust units, net of gross transaction
charges 5,652,7693,766,826
Unrealized appreciation of investment65,185
177,631
Undistributed net investment income2,737,446
1,227,135
Net assets$8,455,4005,171,592
Net asset value per unit$.9431.4687
1993
Trust Property:
Investment in securities at value (amortized cost
$7,949,959 in 1995 Trust and $5,169,319 in
2004 Trust)$8,545,4446,404,855
Other assets4,69810,554
$8,550,1426,415,409
Interest of Holders: 9,216,720 units in 1995 Trust and
12,439,560 units in 2004 Trust of fractional undivided
interest outstanding:
Cost of Trust units, net of gross transaction
charges 5,587,0124,007,202
Unrealized appreciation of investment595,485
1,235,536
Undistributed net investment income2,367,645
1,172,671
Net assets$8,550,1426,415,409
Net asset value per unit$.92770.5157
See notes to financial statements.
A-7
<PAGE>
THE SMITH BARNEY FUND OF STRIPPED ("ZERO")
U.S. TREASURY SECURITIES, SERIES A
Statements of Operations and Changes in Net Assets
For the years ended December31, 1994, 1993 and 1992
<S> <C> <C> <C> <C>
1995 Trust2004 Trust
1994 19931992 19941993 1992
Operations:
Interest income$646,266641,118645,669378,501
411,602 426,486
Expenses:
Trustee and
professional fees(7,018)(3,235)(3,078)(7,671)
(4,142) (4,347)
Other (1,270)(1,075)(1,522)(1,270)(1,162)(1,522)
Total expenses(8,288)(4,310)(4,600)(8,941)
(5,304) (5,869)
Net investment
income 637,978636,808641,069369,560406,298
420,617
Realized gain on sale
of securities29,457135,17867,391160,486222,439
86,997
Increase (decrease) in unrealized
appreciation(530,300)(183,950)(120,150)
(1,057,905) 562,169(35,456)
Net increase
(decrease)
in net assets
from operations137,135588,036588,310
(527,859) 1,190,906472,158
Capital share transactions:
Sales of units421,133632,766535,602414,316
355,249 313,886
Redemption of units:
Principal(355,376)(586,740)(661,253)(654,692)
(533,993) (380,691)
Net investment income (268,177)(413,391)
(338,723) (315,096)(235,542)(140,790)
Realized gains(29,457)(135,178)(67,391)
(160,486) (222,439)(86,997)
(231,877)(502,543)(531,765)(715,958)(636,725)
(294,592)
Increase (decrease)
in net assets(94,742)85,49356,545(1,243,817)
554,181 177,566
Net assets:
Beginning of year8,550,1428,464,6498,408,104
6,415,409 5,861,2285,683,662
End of year$8,455,4008,550,1428,464,6495,171,592
6,415,409 5,861,228
Units sold 451,800702,800652,600903,600 702,800803,200
Units redeemed 702,8001,255,0001,305,2002,309,200
2,108,400 1,606,400
See notes to financial statements.
A-8<PAGE>
</TABLE>
<PAGE>
THE SMITH BARNEY FUND OF STRIPPED ("ZERO")
U.S. TREASURY SECURITIES, SERIES A
Notes to Financial Statements
December31, 1994
(1) Significant Accounting Policies
The Smith Barney Fund of Stripped ("Zero") U.S. Treasury
Securities, Series A (the "Fund") is registered under the
Investment Company Act of 1940 as a Unit Investment Trust.
The following is a summary of significant accounting policies
consistently followed by the Fund in the preparation of its
financial statements. The policies are in conformity with
generally accepted accounting principles.
Valuation of securities by the evaluator was made on the
basis of current bid prices for the obligations.
The difference between the initial cost of Stripped U.S.
Treasury Securities and principal amount of each security is
being amortized over the period to its maturity date using the
interest method.
All items of income and expenses are attributable to the unit
holders, on a pro rata basis, for federal income tax purposes
in accordance with the grantor trust rules of the Internal
Revenue Code. Accordingly, no provision for taxes is
required to be made by the Trusts.
(2) Transaction Charges
During the year ended December31, 1994, the Sponsor, Smith
Barney Inc., received transaction charges aggregating $4,799
and $10,194 with respect to the 1995 Trust and 2004Trust,
respectively.
(3) Investments
At December31, 1994, the cost of investments for federal
income tax purposes was the same as the cost for financial
reporting purposes. There was gross unrealized depreciation
of $4,055 and $1,000 and gross unrealized appreciation of
$69,240 and $178,631 for the 1995Trust and 2004Trust,
respectively.
The aggregate cost of purchases of securities during the year
ended December31, 1994 was $421,133 and $414,316 for the
1995 Trust and 2004 Trust, respectively. The aggregate
proceeds from sales during the year ended December31, 1994
was $653,010 and $1,130,274 for the 1995 Trust and 2004
Trust, respectively.
(Continued)
A-9<PAGE>
2<PAGE>
THE SMITH BARNEY FUND OF STRIPPED ('ZERO")
U.S. TREASURY SECURITIES, SERIES A
Notes to Financial Statements
(4) Supplemental Information
Selected data per 1,000 units of the Fund outstanding
throughout the years ended December 31, 1994, 1993 and
1992, respectively, are as follows (based on average units
outstanding throughout the years):
<TABLE>
<S> <C> <C><C><C><C><C>
1995 Trust2004 Trust
1994 19931992 19941993 1992
Interest income$71.9667.1863.9834.9132.7030.11
Expenses .92.45.46.83.42.41
Net investment income 71.0466.7363.5234.08
32.28 29.70
Increase (decrease) in
unrealized appreciation*(55.64)(5.54)(3.83)
(81.11) 60.115.63
Net increase (decrease) in
net assets from operations15.4061.1959.69
(47.03) 92.3935.33
Net assets:
Beginning of year927.68866.49806.80515.73
423.34 388.01
End of year$943.08927.68866.49468.70515.73
423.34
* If the amount shown per 1,000 units outstanding
throughout the period does not accord with the change in the
aggregate gains or losses in the portfolio of securities for the
period, it is because of the timing of sales and redemptions of
the Fund's units in relation to fluctuating market values for
the portfolio.
<PAGE>
A-10<PAGE>
THE SMITH BARNEY FUND OF STRIPPED ("ZERO")
U.S. TREASURY SECURITIES, SERIES A
Portfolio as of December31, 1994
<C> <S> <C> <C><C><C>
Aggregate
PrincipalMaturityAmortized
Amount Title of SecurityCouponDate CostValue
1995 Trust
$ 8,930,000Stripped U.S. Treasury Securities0%
11/15/95 $8,348,6258,417,865
35,720U.S. Treasury Bonds 11.50% 11/15/95
41,048 36,993
$ 8,965,720$8,389,6738,454,858
2004 Trust
$ 10,990,000Stripped U.S. Treasury Securities0%
11/15/04 $4,931,3905,110,021
43,960U.S. Treasury Bonds 11.625% 11/15/04
56,061 55,061
$ 11,033,960$4,987,4515,165,082
Portfolio as of December31, 1993
Aggregate
PrincipalMaturityAmortized
Amount Title of SecurityCouponDate CostValue
1995 Trust
$ 9,180,000Stripped U.S. Treasury Securities0%
11/15/95 $7,907,6068,503,893
36,720U.S. Treasury Bonds 11.50% 11/15/95
42,353 41,551
$ 9,216,720$7,949,9598,545,444
2004 Trust
$ 12,390,000Stripped U.S. Treasury Securities0%
11/15/04 $5,105,9986,332,901
49,560U.S. Treasury Bonds 11.625% 11/15/04
63,321 71,954
$ 12,439,560$5,169,3196,404,855
A-11<PAGE>
</TABLE>
<PAGE>
* The summary description appearing in this Prospectus of rights
of Holders (as defined below) under the Indenture does not
purport to be complete and is qualified in its entirety by reference
to the complete text of the Indenture, which is filed with the
Securities and Exchange Commission as an exhibit to the
Registration Statement under the Securities Act of 1933 of which
this Prospectus is a part.
THE SMITH BARNEY FUND OF
STRIPPED ("ZERO")
U.S. TREASURY SECURITIES, SERIES A
PROSPECTUS - PART B
Note: Part B of this Prospectus may not be distributed unless
accompanied by Part A.
DESCRIPTION OF THE FUND
Structure
Series A of The Smith Barney Shearson Fund of Stripped
("Zero") U.S. Treasury Securities (the "Fund") originally
consisted of three separate unit investment trusts (the "Trusts")
created by one Trust Indenture (the "Indenture")* among
Shearson Lehman Brothers Inc. (the "Sponsor"), The Bank of
New York (the "Trustee") and Kenny S&P Evaluation Services
(formerly called Standard & Poor's Corporation) (the
"Evaluator") under New York law. One of the Trusts expired on
November 15, 1991. In July, 1993, Smith Barney Shearson Inc.
became the Sponsor of the Fund (see "Sponsor"). As of the date
of the Statement of Financial Condition of the Fund included in
Part A of this Prospectus, the Sponsor had deposited the
underlying Securities (described below) identified in the Portfolio
in Part A with the Trustee at prices equal to the evaluation of
those Securities on the offering side of the market as determined
by the Evaluator, and the Trustee had delivered to the Sponsor
units of fractional undivided interest ("Units") in each Trust as
set forth in the Statement of Financial Condition. See "Investment
Summary" and the financial statements for the Fund in Part A of
this Prospectus.
The Sponsor intends to deposit additional Securities in each
of the Trusts, with identical maturities to those of the Securities
identified in the portfolios of such Trusts in Part A. The
Securities so deposited may be represented by purchase contracts
assigned to the Trustee together with an irrevocable letter of
credit issued by a commercial bank, cash or cash equivalents to
fund their purchase. Units in the Trusts delivered to the Sponsor
in connection with subsequent deposits will be offered for sale by
means of this Prospectus.
Units are offered for sale at a price based upon the offering
side evaluation of the Securities, plus a transaction charge of
1.50% or less of the price so determined (the "Offering Price").
The Sponsor has undertaken to maintain a secondary market in
the Units, also based upon the offering side evaluation of the
Securities (the "Sponsor's Repurchase Price"). In addition,
Holders of Units (including the Sponsor) have the right to have
their Units redeemed at a price based on the bid side evaluation
of the Securities (the "Redemption Price"). Redemptions will be
made in cash or, at the option of the Holder, in kind. See "Sale
and Redemption of Units."
On the date of the Statement of Financial Condition of the
Fund included in Part A of this Prospectus, each Unit of a Trust
represented the fractional undivided interest in the Securities held
in the Trust set forth under "Investment Summary" in Part A. If
Units of any Trust are redeemed, the face amount of Securities
in the Trust will be reduced by amounts allocable to redeemed
Units, and the fractional undivided interest represented by each
Unit in the balance of the Trust will be increased. If additional
Units are issued by any Trust (through deposit of Securities by
the Sponsor in connection with the sale of additional Units), the
face amount of Securities in the Trust will be increased by
amounts allocable to additional Units, and the fractional
undivided interest represented by each Unit in the balance of the
Trust will be decreased. Units will remain outstanding until
redeemed upon tender to the Trustee by a Holder or until the
liquidation of the Trust pursuant to the terms of the Indenture.
See "Sale and Redemption of Units" and "Administration of the
Fund."
<PAGE>
As used herein, "Securities" includes "Stripped Treasury
Securities" (see "Characteristics of the Securities" below),
interest-bearing Treasury securities ("Treasury Notes"), and
Stripped Treasury Securities and Treasury Notes represented by
contracts to purchase such securities. The term "Holder" refers to
the Sponsor, when appropriate, and to The Guardian Separate
Account B (the "Account") established by The Guardian
Insurance & Annuity Company, Inc. ("GIAC"), which is currently
the only eligible purchaser of Units from the Sponsor. The
Account invests in Units to fund benefits under variable life
insurance policies issued by GIAC (the "Policies") in accordance
with allocation instructions received from purchasers of Policies.
For further information as to the rights of Policy owners, which
should be distinguished from the rights of Holders as set forth in
this Prospectus, see the accompanying Prospectus relating to the
Policies.
Risk Factors
An investment in Units of the Trust should be made with an
understanding of the risks that such an investment may entail,
including the risk that the value of the Trust's portfolio and hence
of the Units will decline with increases in interest rates. High
inflation and recession, together with the fiscal and monetary
measures adopted to attempt to deal with these and other
economic problems, have contributed to wide fluctuations in
interest rates and thus in the value of fixed-rate debt obligations
generally in recent years. The Sponsor cannot predict future
economic policies or their consequences or, therefore, the course
or extent of any similar fluctuations in the future. Moreover,
because interest on "zero coupon" obligations, to which Stripped
Treasury Securities are economically similar (see "Characteristics
of the Securities" below), is not distributed on a current basis but
is in effect compounded, the value of securities of this type (and
of a portfolio primarily comprised of such obligations) is subject
to greater fluctuations in response to changing interest rates than
the value of debt obligations which distribute income regularly.
Accordingly, while the full faith and credit of the United States
Government protects against credit risks on the Securities in
each Trust, disposition of Units before the maturity of the
underlying portfolio Securities at a time when interest rates have
increased will involve greater market risk than disposition of
interests in a trust holding interest-bearing debt obligations. This
risk is greater when the period to maturity is longer. In addition,
a direct Holder will recognize significant amounts of taxable
income before the receipt of the cash attributable to such income.
Characteristics of the Securities
Each Trust consists primarily of Stripped Treasury Securities
with maturities corresponding to that Trust's designation. Each
Trust also holds Treasury Notes which are deposited in order to
provide income with which to pay anticipated expenses of the
Trust. It is anticipated that a constant proportion of Treasury
Notes to Stripped Treasury Securities will be maintained in each
of the Trusts. All of the Securities represent direct obligations of
the United States Government which are payable in full at
maturity at their stated maturity amount. The Securities in each
Trust are not subject to redemption prior to maturity and do not
have any equity or conversion features.
Stripped Treasury Securities held by any Trust will consist of
one or more of the following types of securities: (i) United States
Treasury debt obligations which have been stripped of their
unmatured interest coupons, (ii) coupons which have been
stripped from United States Treasury bonds, and (iii) receipts or
certificates for stripped United States Treasury debt obligations
and stripped coupons. Stripped debt obligations are bonds
originally issued as coupon bonds which have been stripped of
their unmatured interest coupons subsequent to issuance by the
owner; stripped coupons are coupons that were originally issued
as part of and attached to coupon bonds and have subsequently
been stripped from those bonds by their owner. Stripped debt
obligations and coupons (other than when represented by
receipts or certificates as described below) are eligible for
purchase by the Trusts only if held in the book-entry system
maintained by the Federal Reserve pursuant to the United States
Treasury's Separate Trading of Registered Interest and Principal
of Securities program. Receipts or certificates for stripped United
States Treasury debt obligations and coupons evidence ownership
of future interest or principal payments on such obligations and
coupons. Such receipts have been offered for sale by several
investment banking firms, are traded in a secondary market, and
currently represent a large segment of the market for Stripped
Treasury Securities. As described in the offering circulars through
which the receipts are offered for sale, the completeness and
correctness of which are assumed here, the receipt sales programs
of the several firms are not identical but are similar to one
another. The receipts or certificates are typically issued by a
major bank which acts as custodian and nominal holder of the
underlying stripped United States Treasury obligations (which
may be held by such bank either in physical or in book-entry
form). The terms of custody generally provide that the underlying
obligations will be held separate from the general assets of the
custodian and will not be subject to any right, charge, security
interest, lien or claim of any kind in favor of the custodian or any
person claiming through the custodian, that the custodian will be
responsible for applying all payments received on those
underlying obligations to the related receipts or certificates
without making any deductions other than applicable tax
withholding, and that the custodian is required to maintain
insurance for the protection of holders of receipts or certificates
in customary amounts against losses resulting from the custody
arrangement due to dishonest or fraudulent action by the
custodian's employees. The offering circulars for such receipts and
certificates generally provide that the holders of receipts or
certificates, as the real parties in interest, are entitled to the rights
and privileges accorded to holders of the underlying stripped
debt obligations and coupons, including the right in the event of
default in payment of principal or interest thereon to proceed
individually against the United States without acting in concert
with other holders of those receipts or certificates or the
custodian.
Stripped Treasury Securities are sold at a deep discount
because the buyer of those securities receives only the right to a
future fixed payment on the security and does not receive any
rights to periodic interest payments. Purchasers of Stripped
Treasury Securities acquire, in effect, discount obligations that are
substantially similar economically to the "zero coupon" bonds
issued by corporations, which are originally
<PAGE>
issued at a deep discount and do not make any periodic
payments of interest prior to maturity.
Yield
The economic effect of purchasing Units of a Trust is that the
investor who holds such Units until maturity of the underlying
Securities should receive, assuming, among other things, that the
income generated by the Treasury Notes held by such Trust
equals expenses incurred, a fixed yield that can be estimated at
the time of purchase, not only on his original investment but also
on all amortized discount during the life of the underlying
Securities. Accordingly, an investor in the Trusts, unlike an
investor in funds comprised of securities making periodic
distributions, virtually eliminates the risk of being unable to invest
distributions at a rate as high as the anticipated yield on Trust
Units, but will forego the ability to reinvest such yield at higher
rates in the future. The assumed or implicit automatic
reinvestment of the portion of the yield represented by amortized
discount differentiates the Trusts from funds comprised of
securities on which periodic interest is paid. Actual yield realized
by an investor who holds Units until maturity of the underlying
Securities, however, may be more or less than the yield estimated
at the time of purchase of such Units as a result of changes in the
expenses incurred by a Trust or sales of Securities held by a Trust
prior to maturity in order to meet redemptions of Units. See
"Sale and Redemption of Units", "Expenses and Charges" and
"Administration of the Fund - Accounts and Distributions."
A Holder will be required to include annually in gross income
an allocable portion of the discount on the Stripped Treasury
Securities before the receipt of the cash attributable to such
income. For Federal income tax purposes, inclusion will be on a
basis that reflects the effective semi-annual compounding of
accrued but unpaid interest represented by amortization of the
discount on the Stripped Treasury Securities. See "Taxes."
<PAGE>
SALE AND REDEMPTION OF UNITS
Pricing of Units
The price per Unit of a Trust (the "Price per Unit") is
computed as follows. The sum of (i) taxes or other governmental
charges against the Trust not previously deducted, (ii) accrued
fees and expenses of the Trustee (including legal and auditing
expenses), the Evaluator and counsel, and certain other expenses,
and (iii) any cash held for distribution to Holders of record as of
a date prior to the evaluation is subtracted from the sum of (a)
the aggregate evaluation of the Trust's portfolio Securities
determined by the Evaluator, (b) cash on hand in the Trust
(other than cash deposited by the Sponsor for the purchase of
Securities), (c) accrued and unpaid interest on the Treasury
Notes as of the date of computation (except for interest payable
to the Sponsor as a special distribution, as explained below) and
(d) all other assets of the Trust. The resulting difference is
divided by the number of Units outstanding to arrive at the Price
per Unit for the Trust with respect to which the foregoing
calculations were made.
The aggregate evaluation of each Trust's portfolio Securities
is determined by the Evaluator on the basis of current prices for
the Securities, if available; current prices for comparable
securities; the value of the Securities as determined by appraisal;
or any combination of the foregoing. The Evaluator may obtain
current price information as to the Securities from investment
dealers or brokers (including the Sponsor) that customarily deal
in those types of securities.
The Price per Unit on the offering side of the market used to
determine the Offering Price and Sponsor's Repurchase Price is
computed as of the Evaluation Time on each Business Day,
effective for all such transactions since the immediately preceding
Evaluation Time. See "Sale of Units" and "Market for Units"
below. The Price per Unit on the bid side of the market used to
determine the Redemption Price is computed as of the
Evaluation Time next following the tender by a Holder of its
Units for redemption, effective for all redemptions since the
immediately preceding Evaluation Time. See "Redemption of
Units" below. In addition, the Price per Unit on the offering side
and the bid side of the market is determined (i) on June 30 and
December 31 of each year (or on the last Business Day prior to
such dates) and (ii) on any Business Day on which such a
determination is requested by the Trustee or the Sponsor.
As indicated under "Investment Summary" in Part A of this
Prospectus, the Stripped Treasury Securities and Treasury Notes
deposited in each Trust include elements of amortized discount
and accrued interest, respectively. Evaluations of Securities in a
Trust include discount amortized on the Stripped Treasury
Securities from the date of purchase or sale of Units of the Trust
to the date of settlement for such Units (normally five Business
Days). Interest on the Treasury Notes accruing prior to their
deposit in a Trust and after such deposit to the date five Business
Days after such deposit is paid to the Sponsor by the Trustee as
a special distribution and recovered by the Trustee from interest
received on the Treasury Notes, and is therefore not included in
the evaluation of Securities in the Trust. See "Investment
Summary" in Part A of this Prospectus.
In addition to the deposit by it of contracts representing
Securities expected to settle within the usual settlement time for
sales of securities (normally five Business Days), the Sponsor may
deposit contracts representing Securities with an agreed-upon
delayed settlement date which will not be delivered to the
Sponsor (or to the Trust) by the settlement date for Units
acquired by the Sponsor on its deposit of such contracts.
Amortized discount on such Securities will not accrete to the
benefit of the Trust holding the contract representing the
Securities until the settlement date for such Securities.
The Price per Unit of a Trust will vary in accordance with
fluctuations in the evaluation of the underlying Securities.
Amortization of discount will have the effect of increasing at any
particular time the value of the underlying Securities.
<PAGE>
As used in this Prospectus, the term "Business Day" means
every Monday through Friday except for New Year's Day,
Martin Luther King's Birthday, Presidents' Day, Memorial Day,
Independence Day, Labor Day, Columbus Day, Veteran's Day,
Thanksgiving and Christmas.
Sale of Units
The Offering Price per Unit of a Trust is determined by
evaluating the Trust's portfolio Securities on the offering side of
the market in determining the Price per Unit (see "Pricing of
Units") and adding the applicable transaction charge. The
transaction charge varies with the remaining years to maturity of
the Stripped Treasury Securities in the Trust, as follows:
<TABLE>
<S> <C><C>
Percent of
Percent of
Offering
Net Amount
Remaining Years to Maturity
Price
Invested
Less than 3 years
.5
.503
At least 3 years but less than 8 years
1.00
1.010
At least 8 years but less than 13 years
1.50
1.523
</TABLE>
The transaction charges set forth above, which do not reflect
distribution expenses because all sales are currently made to the
Account, are less than sales charges on comparable unit
investment trusts offered to the public by the Sponsor. On Units
sold to the Account, GIAC initially pays the transaction charge.
GIAC has represented that it intends to recover any transaction
charges paid by it from the Investment Division within the
Account corresponding to the Trust with respect to which the
transaction charge was paid through a charge against the assets
of such Division. Reference should be made to the accompanying
Prospectus relating to the Policies for further information.
Market For Units
The Sponsor has undertaken to maintain a secondary market
for Units of each Trust and to offer continuously to purchase
Units of each Trust at the Sponsor's Repurchase Price. The
Sponsor's Repurchase Price per Unit of a Trust is determined by
evaluating the Trust's portfolio Securities on the offering side of
the market in determining the Price per Unit (see "Pricing of
Units").
The right of Holders to resell their Units to the Sponsor may
be suspended and payment postponed for any period during
which the right of redemption with respect to such Units has been
suspended. See "Redemption of Units" below.
Consolidated financial statements of the Sponsor are
incorporated by reference in this Prospectus. See "Financial
Information Concerning the Sponsor" in Part A of this
Prospectus.
Redemption of Units
In addition to the right of a Holder to sell Units to the
Sponsor at the Sponsor's Repurchase Price, a Holder (including
the Sponsor) is also entitled to redeem Units at the office of the
Trustee upon tender of certificates, if issued, and payment of any
relevant tax without any other fee. The Redemption Price per
Unit of a Trust is determined by evaluating the Trust's portfolio
Securities on the bid side of the market in determining the Price
per Unit (see "Pricing of Units").
<PAGE>
Because the Sponsor's Repurchase Price is based on the
offering side evaluation of the Securities in a Trust and the
Redemption Price is based on the bid side evaluation of such
Securities, it is expected that it will always be to the advantage
of a Holder (other than the Sponsor) to resell Units to the
Sponsor rather than to redeem them. Unless the Account has
elected an in kind payment, the Sponsor therefore expects to
repurchase any Units tendered for redemption by the Account.
The Sponsor, as a Holder, intends to redeem Units it has
purchased in the secondary market or acquired on deposit of
Securities in a Trust if it determines it is undesirable to continue
to hold those Units in its inventory. Factors which the Sponsor
will consider in making such a determination will include the
number of Units of all Trusts which it has in its inventory, the
salability of the Units, and its estimate of the time required to sell
the Units and general market conditions. The Sponsor has
committed to redeem Units only in an amount substantially
equal to the value of one or more portfolio Securities, so that
uninvested cash generated by a redemption is de minimis.
Certificates to be redeemed must be properly endorsed or
accompanied by a written instrument or instruments of transfer.
The Trustee will redeem Units either in cash or, if specified at
the option of the Holder, in kind as requested in writing to the
Trustee. A Holder will be entitled to receive redemption proceeds
within seven calendar days following tender or, if the seventh
calendar day is not a Business Day, on the last Business Day prior
thereto.
In kind distributions will take the form of distributions of
certificates representing whole Securities and cash representing
fractional interests in such Securities. The Securities to be
received by a Holder upon redemption of its Units in kind will
be selected by the Trustee from a list supplied by the Sponsor.
The Trustee is empowered to sell Securities in order to make
funds available for cash distributions and for in kind distributions
to the extent necessary to redeem fractional interests in whole
Securities represented by Units redeemed. To the extent that
Securities are redeemed in kind or sold, the size of the relevant
Trust will be reduced. Sales may be required at a time when
Securities would not otherwise be sold and may result in lower
prices than might otherwise be realized. In addition, because the
Sponsor may specify minimum face amounts in which Securities
may be sold, the proceeds of sale may exceed the amount
required to redeem Units. Any excess proceeds will be distributed
to Holders upon maturity of the Securities in the relevant Trust.
The right of Holders to redeem their Units may be suspended
and payment postponed for any period (i) during which the New
York Stock Exchange (the "NYSE") is closed other than for
customary weekend and holiday closings, or (ii) during which, as
determined by the Securities and Exchange Commission (the
"Commission"), (a) trading on the NYSE is restricted or (b) an
emergency exists as a result of which disposal or evaluation of
the Securities is not reasonably practicable, or (iii) for any other
periods which the Commission may by order permit.
Comparison of Offering Price, Sponsor's
Repurchase Price and Redemption Price
With respect to each Trust, on the date of the Statement of
Financial Condition of the Fund included in Part A of this
Prospectus, the Offering Price per Unit (which includes the
transaction charge) and the Sponsor's Repurchase Price per Unit
(each based on the offering side evaluation of Securities in a
Trust) exceeded the Redemption Price per Unit (based on the
bid side evaluation thereof) by the amounts set forth under
"Investment Summary" in Part A.
On the date of the Statement of Financial Condition of the
Fund included in Part A, the bid prices for Securities in each of
the Trusts were lower than the offering prices thereof (see
Portfolio of the Fund in Part A). For this and other reasons
(including fluctuations in the market prices of the Securities and
the fact that the Offering Price includes a transaction charge),
the amount realized by a Holder upon any sale or redemption of
Units may be less than the price paid for such Units.
<PAGE>
TAXES
The following discussion relates only to Holders (the Account
and the Sponsor) of Units of the Fund, and not to Policy owners.
For information on tax consequences to Policy owners, see the
attached Prospectus relating to the Policies.
In the opinion of Davis Polk & Wardwell, special counsel for
the Sponsor, under existing law:
Each Trust is not an association taxable as a corporation for
Federal income tax purposes, and income received by the Trust
will be treated as the income of the Holders of the Trust in the
manner set forth below.
Each Holder will be considered the owner of a pro rata
portion of each Security in its Trust under the grantor trust rules
of Sections 671-679 of the Internal Revenue Code of 1986, as
amended. In order to determine the face amount of a Holder's
pro rata portion of each Security in its Trust on the date of the
Statement of Financial Condition of the Fund included in Part
A of this Prospectus, see "Face Amount of Securities" under the
Investment Summary in Part A. The total cost to a Holder for its
Units, including transaction charges, is allocated among its pro
rata portion of each Security in its Trust (in proportion to the fair
market values thereof on the date the Holder purchases its
Units) in order to determine its tax cost for its pro rata portion
of each Security. In order for a Holder who purchased its Units
on the date of the Statement of Financial Condition of the Fund
included in Part A of this Prospectus to determine the fair market
value of its pro rata portion of each Security in its Trust on such
date, see Sponsor's Repurchase Price under the Investment
Summary in Part A.
Each Trust consists primarily of Stripped Treasury Securities.
A Holder is required to treat its pro rata portion of each
Stripped Treasury Security in its Trust as a bond that was
originally issued on the date the Holder purchased its Units at
an original issue discount equal to the excess of the stated
redemption price at maturity over the Holder's tax cost therefor
as discussed above, and to include annually in income a portion
of such original issue discount determined under a formula which
takes into account the semi-annual compounding of interest.
Each Holder will be considered to have received the income
on its pro rata portion of the Treasury Notes in its Trust when
interest on the Notes is received by its Trust. A Holder who
itemizes deductions will be entitled to deductions for income tax
purposes of the Holder's pro rata share of expenses paid by its
Trust, including fees of the Trustee and the Evaluator.
A Holder will recognize taxable gain or loss when all or part
of his pro rata portion of a Security is disposed of by the Fund
for an amount greater or less than his adjusted tax basis. Any
such taxable gain or loss will be capital gain or loss except that
any gain from the disposition of a Holder's pro rata portion of
a Security acquired by the Holder at a "market discount" (i.e., if
the Holder's original cost for his pro rata portion of the Security
(plus any original issue discount which will accrue thereon) is less
than its stated redemption price at maturity) will be treated as
ordinary income to the extent the gain does not exceed the
accrued market discount. Capital gains are generally taxed at the
same rate as ordinary income. However, the excess of net long-
term capital gains over net short-term capital losses may be taxed
at a lower rate than ordinary income for certain noncorporate
taxpayers. A capital gain or loss is long-term if the asset is held
for more than one year and short-term if held for one year or
less. The deduction of capital losses is subject to limitations. A
Holder will also be considered to have disposed of all or part of
his pro rata portion of each Security when he sells or redeems all
or some of his Units.
Holders will be required for Federal income tax purposes to
include amounts in ordinary gross income in advance of the
receipt of the cash attributable to such income. Therefore, direct
purchase of Units may be appropriate only for a tax-deferred
account which is not subject to a current tax on income accrued
in advance of the receipt of the cash attributable to such income.
<PAGE>
Under the income tax laws of the State and City of New York,
each Trust is not an association taxable as a corporation and
income received by the Trust will be treated as the income of the
Holders of the Trust in the same manner as for Federal income
tax purposes.
The foregoing discussion relates only to Federal and New
York State and City income taxes. Holders also may be subject
to state and local taxation in other jurisdictions. Holders should
consult their own tax advisers regarding specific questions as to
Federal, state or local taxes.
SPONSOR'S PROFITS
The Sponsor receives a transaction charge at the rates set forth
under "Sale and Redemption of Units - Sale of Units" on any
sale by it of Units, regardless of whether such Units were
acquired by the Sponsor on the deposit of Securities in a Trust
or in the secondary market maintained by it. In addition, the
Sponsor may realize a profit on the deposit of Securities in a
Trust based upon the difference between the cost of the
Securities to the Trust (which is based on the offering side
evaluation of the Securities) and the price paid by the Sponsor for
such Securities. The Sponsor also may realize profits or sustain
losses as a result of fluctuations in the aggregate value of a
Trust's portfolio Securities and hence in the Offering Price for
the related Units sold by the Sponsor subsequent to the date of
the acquisition by the Sponsor of such Units on its deposit of
Securities in a Trust.
In maintaining a secondary market for the Units, the Sponsor
also will realize profits or sustain losses in the amount of any
difference between the Sponsor's Repurchase Price at the time of
such purchase and the Offering Price or Redemption Price at the
time of resale or redemption, as the case may be.
Cash, if any, received from purchasers of Units by the Sponsor
prior to the settlement dates for purchase of Units or prior to
payment for Securities upon their delivery may be used in the
Sponsor's business, subject to the limitations of Rule 15c3-3
under the Securities Exchange Act of 1934, and may be of benefit
to the Sponsor.
EXPENSES AND CHARGES
Initial Expenses
The Sponsor has borne all expenses incurred in creating and
establishing the Fund, including the cost of the initial preparation
of the Indenture, the initial fees and expenses of the Trustee,
legal and auditing expenses and other out-of-pocket expenses.
Sponsor's Fees
The Sponsor receives no fee from the Fund for its services as
such. However, while the transaction charges paid by GIAC to
the Sponsor are not directly charged to the Account, GIAC has
represented that it will recover such transaction charges through
charges against the assets of the Division of the Account
corresponding to the Trust with respect to which the transaction
charge was paid. Policy owners therefore will indirectly bear these
charges. Reference should be made to the accompanying
Prospectus relating to the Policies for further information.
Trustee's and Evaluator's Fees
The Trustee's and Evaluator's fees are set forth under
"Investment Summary" in Part A of this Prospectus. The
Trustee's fees, payable semi-annually out of the assets of each
Trust, are determined monthly based on the largest face amount
of Securities in a Trust during the preceding month. The Trustee
also may benefit to the extent that it holds funds on deposit in
the various non-interest bearing accounts created under the
Indenture. See "Administration of the Fund - Accounts and
Distributions."
<PAGE>
The Evaluator's fees set forth under "Investment Summary" in
Part A for each determination of the Offering Price and
Sponsor's Repurchase Price will be paid by the Sponsor. The
Evaluator's fees for determining the Redemption Price will be
borne by the Trust.
Charges Borne by the Trusts
In addition to the Trustee's and Evaluator's fees borne by the
Trusts identified above, charges borne by the Trusts include: (i)
fees of the Trustee for extraordinary services, (ii) certain expenses
of the Trustee (including legal and auditing expenses) and of
counsel designated by the Sponsor, (iii) various governmental
charges, (iv) expenses and costs of any action taken to protect a
Trust, (v) indemnification of the Sponsor and the Trustee for any
loss, liability and expense incurred without gross negligence, bad
faith, wilful misconduct or reckless disregard of their duties and
(vi) to the extent then lawful, expenses (including, but not limited
to, legal, auditing and printing expenses) of maintaining
registration or qualification of the Units and/or the Fund under
Federal or state securities laws subsequent to initial registration.
The above fees and expenses, including the Trustee's and
Evaluator's fees, are deducted from the Income Account of each
Trust in any month in which interest is paid on the Treasury
Notes in such Trust and, to the extent funds are not then
available in the Income Account, from the Capital Account of the
Trust to which they relate. To the extent funds are not available
in the Capital Account, the Trustee is empowered to sell
Securities in the Trust in order to make funds available to pay
such amounts. The above fees, expenses and advances, when paid
by or owing to the Trustee, are secured by a lien on the assets of
the relevant Trust.
ADMINISTRATION OF THE FUND
Records
The Trustee keeps records of transactions of the Fund,
including a current list of the Securities held in each Trust and
a copy of the Indenture. These records are available to Holders
for inspection at the office of the Trustee at reasonable times
during the Trustee's business hours. Portfolio Supervision
<PAGE>
In selecting Securities for deposit in the Fund, the following
factors, among others, are considered by the Sponsor: (i) the
types of Securities available; (ii) the prices of those Securities
relative to other comparable securities; (iii) the yield to maturity
of those Securities; and (iv) the maturities of those Securities.
Neither the Sponsor nor the Trustee will be liable in any way
for any default, failure or defect in any of the Securities. In the
event of a failure to deliver Securities that have been purchased
for a Trust under a contract ("Failed Securities"), the Sponsor is
authorized under the Indenture to direct the Trustee to use the
funds reserved for the purchase of Failed Securities to acquire
substitute Securities with identical maturities ("Substitute
Securities"). Substitute Securities must be purchased at a price
that results in a yield to maturity as of their date of deposit
which is equivalent to the yield to maturity of the Failed
Securities. If the Sponsor does not or cannot, in accordance with
the restrictions on its ability to do so summarized above, direct
the Trustee to purchase Substitute Securities, the Sponsor will,
within 30 days after delivery to the Sponsor of notice of default
on the contract, cause to be refunded the transaction charge and
cost of Securities to the Trust attributable to Units acquired on
deposit of contracts to purchase the Failed Securities, plus
accrued interest and amortization. Within five days after the
acquisition of Substitute Securities or a refund by the Sponsor,
the Trustee will notify all Holders of the affected Trust of the
acquisition of the Substitute Securities or such refund and, within
30 days thereafter, make a pro rata distribution of the amount of
such refund or the amount, if any, by which the cost to the Trust
of the Failed Securities exceeded the cost of the Substitute
Securities.
In the event that it becomes necessary for the Trust to sell
Securities in order to make funds available for cash redemptions,
the Securities to be sold will be selected by the Trustee from a list
supplied by the Sponsor. Securities will be chosen for this list by
the Sponsor on the basis of market factors. Provision is made
under the Indenture for the Sponsor to specify minimum face
amounts in which blocks of Securities are to be sold in order to
obtain the best price for the Trust. While these minimum
amounts may vary from time to time in accordance with market
conditions, the Sponsor believes that the minimum face amounts
specified would range from $25,000 to $100,000.
If a Holder requests in kind redemption of its Units, the
Securities received by the Holder upon redemption will also be
selected by the Trustee from a list supplied by the Sponsor.
The Sponsor may direct the disposition of Securities upon
default in payment of principal or interest which is not promptly
cured, institution of certain legal proceedings, default in payment
of principal of or interest on other securities constituting
obligations of the United States Government, or a decline in price
or the occurrence of other market or credit factors that in the
opinion of the Sponsor would make the retention of the
Securities in any Trust detrimental to the interest of the Holders
of that Trust. If a default in the payment of principal or interest
on any Security occurs and if the Sponsor fails to give instructions
to sell or hold the Security within 30 days after the notification
of such failure by the Trustee to the Sponsor, the Indenture
provides that the Trustee may sell the Security.
Accounts and Distributions
The Indenture provides for the creation by the Trustee of
three accounts on behalf of each Trust of the Fund: an Income
Account, a Capital Account, and a Reserve Account. Interest
received on the Treasury Notes held by each Trust is credited to
the Income Account. Proceeds from the disposition of any
Security (other than proceeds representing interest and penalties
on the Treasury Notes which are credited to the Income Account)
which are not used for redemption of Units are credited to the
Capital Account of the relevant Trust. A Reserve Account may
be created by the Trustee on behalf of each Trust in accordance
with the terms of the Indenture by withdrawals from time to time
from the Income or Capital Accounts of amounts deemed
requisite by the Trustee to establish a reserve for any taxes or
other governmental charges that may be payable out of the assets
of such Trust.
Any date on which a distribution to Holders of Units is made
is referred to herein as a "Distribution Day." Because funds held
by the Trustee in the various accounts do not bear interest, and
because of the "zero coupon" nature of Stripped Treasury
Securities which constitute substantially all of the assets of the
Trusts, it is anticipated that no distributions will be made to
Holders of Units until the next Business Day following the
maturity of the Securities in the Trust portfolio to which the
Units relate. Distributions will be made to Holders as of the
Business Day immediately preceding the Distribution Day (the
"Record Day") by mail on the Distribution Day and will consist
of an amount equal to each Holder's pro rata share of the cash
balance in the Income and Capital Accounts of a Trust as of the
close of business on the Record Day, less any accrued expenses,
fees or liabilities owed by the Trust and amounts allocated by the
Trustee to the Reserve Account.
Reports to Holders
After the end of each calendar year, the Trustee will furnish
to Holders of Units in the relevant Trust a statement (i)
summarizing transactions for the year in the Income, Capital and
Reserve Accounts of the Trust, (ii) identifying Securities sold and
purchased during, and listing Securities held at the end of, the
year by the Trust, (iii) stating the Trust's Offering Price,
Sponsor's Repurchase Price and Redemption Price per Unit
based upon the computation thereof made at the end of the year
and (iv) specifying the amounts, if any, distributed during the
year from the Trust's Income and Capital Accounts.
<PAGE>
The accounts of each Trust will be audited at least annually by
independent certified public accountants designated by the
Sponsor, and the report of such accountants will be furnished by
the Trustee to Holders. Upon distribution of the assets of a Trust
as described under "Accounts and Distributions", the Trustee will
furnish to Holders as of the Record Day a statement of the
amounts of interest and other receipts being distributed,
expressed in each case as a dollar amount per Unit.
Certificates
Upon request to the Trustee and payment of postage, Holders
are entitled to a registered Certificate for Units. Certificates are
transferable or interchangeable upon presentation at the office of
the Trustee, and payment of any taxes or governmental charges
imposed on the transaction, plus a transfer charge specified by the
Trustee and approved by the Sponsor. Mutilated, destroyed,
stolen or lost Certificates will be replaced upon delivery of
satisfactory indemnity and payment of expenses incurred.
Unless a Certificate is requested, Holders will hold their Units
in uncertificated form. The Trustee will credit each such Holder's
account with the number of Units purchased by that Holder.
Uncertificated Units are transferable through the same
procedures applicable to Units evidenced by Certificates, except
that no Certificate need be presented to the Trustee and none
will be issued upon transfer unless requested by the Holder.
Amendment and Liquidation
The Sponsor and Trustee may amend the Indenture without
the consent of Holders (i) to cure any ambiguity or to correct or
supplement any of its provisions which may be defective or
inconsistent, (ii) to make any changes in its provisions required
by the Commission or any successor governmental agency, or (iii)
to make any other changes which do not adversely affect the
interest of the Holders, as determined in good faith by the
Sponsor.
The provisions of the Indenture with respect to any Trust also
may be amended in any respect or waived by the Sponsor and
Trustee with the consent of the Holders of 51% of the Units of
such Trust then outstanding. However, none of such amendments
or waivers may permit the acquisition by a Trust of Securities
with maturity dates differing from those of the Securities
described in the portfolio of such Trust in Part A of this
Prospectus or reduce the percentage of Units required to consent
to such amendments or waivers without the consent of all Holders
of Units in such Trust. The Trustee will promptly notify Holders
of the substance of any such amendment.
The Indenture will terminate in accordance with its terms
upon the earlier of the distribution of all assets of any Trust, as
to the Trust holding the assets so distributed, or the date
specified under "Investment Summary - Mandatory Termination
Date" in Part A of this Prospectus. A Trust may be liquidated if
the value of the Trust is less than the minimum value set forth
under "Investment Summary" in Part A. A Trust also may be
terminated by action of Holders of 51% of the Units in such
Trust at any time. The Trustee will deliver written notice of any
proposed termination of a Trust to each Holder within a
reasonable period of time prior to its proposed liquidation,
specifying the times at which Holders may surrender their
Certificates for cancellation or otherwise receive payment for
their Units if held in uncertificated form. Within a reasonable
period of time after notice of proposed termination of a Trust,
the Trustee must sell all of the Securities then held in the Trust
and distribute to each Holder the Holder's interest in the Income
and Capital Accounts after deduction of accrued expenses, fees
or liabilities owed by the Trust and any amounts allocated by the
Trustee to the Reserve Account. Such distribution normally will
be made by mailing a check to the address of the Holder
appearing on the record books of the Trustee on the Record Day
prior to the Distribution Day on which such checks are mailed.
<PAGE>
SPONSOR
The Sponsor, a Delaware corporation which is an indirect
wholly owned subsidiary of The Travelers Inc., is engaged in the
underwriting, securities and commodities brokerage, and
investment advisory business, and is a member of the NYSE,
other major securities exchanges and commodity exchanges, and
the National Association of Securities Dealers, Inc. In July, 1993,
Primerica Corporation ("Primerica") and its subsidiary, Smith
Barney, Harris Upham & Co. Incorporated, acquired the
domestic retail brokerage and asset management businesses of
Shearson Lehman Brothers Inc., previously the sponsor of the
Fund. As a result of this acquisition, Smith Barney Shearson Inc.
is now the Sponsor of the Fund. In January, 1994, Primerica
completed a merger with The Travelers Corporation and they
became The Travelers Inc. The Sponsor has acted as principal
underwriter and managing underwriter of other investment
companies. The Sponsor, in addition to participating as a member
of various selling groups or as an agent of other investment
companies, executes orders on behalf of investment companies
for the purchase and sale of securities of such companies and sells
securities to such companies in its capacity as a broker or dealer
in securities.
Limitations on Liability
The Sponsor will not be liable to the Fund or to Holders for
taking any action or refraining from taking any action in good
faith or for errors in judgment and will not be responsible for
depreciation or loss with respect to the Securities held by the
Fund, except in cases of wilful misfeasance, bad faith, gross
negligence or reckless disregard of its obligations under the
Indenture. The acquisition of all or substantially all of the assets
of the Sponsor and the assumption of its obligations under the
Indenture by a corporation or partnership which carries on its
business will relieve the Sponsor of its obligations and duties
under the Indenture.
Resignation and Removal
If the Sponsor fails to perform its duties, becomes incapable
of acting or becomes bankrupt or its affairs are taken over by
public authorities, the Trustee may (i) appoint a successor
Sponsor at rates of compensation not exceeding any maximum
prescribed by the Commission and in an amount deemed
reasonable by the Trustee, (ii) liquidate the Fund and distribute
the proceeds of the sale of Securities held in the Fund as
provided under "Administration of the Fund - Amendment and
Liquidation" or (iii) continue to act as Trustee in accordance with
the Indenture.
TRUSTEE
The Trustee is The Bank of New York, a New York
corporation authorized to do a banking business with its
corporate trust office at 101 Barclay Street, New York, New
York, which is subject to supervision by the Superintendent of
Banks of the State of New York, the Federal Deposit Insurance
Corporation and the Board of Governors of the Federal Reserve
System.
Limitations on Liability
The Trustee will not be liable to the Fund or to Holders of
Units for taking any action or refraining from taking any action
in good faith or for errors in judgment and will not be responsible
for depreciation or loss with respect to the purchase or sale of
or the failure to sell any Securities held by the Fund, nor will the
Trustee be personally liable for any taxes or other governmental
charges imposed on the Fund or the Securities. The Trustee will
not be liable for any action taken in good faith in reliance on
prima facie properly executed documents. However, the foregoing
limitations (and other exculpatory provisions in the Indenture
relating to the Trustee) will not protect the Trustee in cases of
wilful misfeasance, bad faith, gross negligence, or reckless
disregard of its duties and obligations under the Indenture.
<PAGE>
Resignation and Removal
The Trustee or any successor may resign upon notice to the
Sponsor and may be removed upon the direction of the Holders
of 51% of the Units at any time. The Trustee may also be
removed by the Sponsor without the consent of Holders if it
becomes incapable of acting, becomes bankrupt or its affairs are
taken over by public authorities. In case of such resignation or
removal, the Sponsor will use its best efforts to appoint a
successor promptly. If no successor Trustee is appointed within
thirty days after notification by or to the Trustee of its resignation
or removal, the Trustee may apply to a court for the appointment
of a successor. Resignation or removal of the Trustee will
become effective upon appointment of a successor Trustee.
EVALUATOR
The Evaluator is Kenny S&P Evaluation Services, a division of
Kenny Information Systems, Inc., with main offices located at 65
Broadway, New York, New York 10006. Kenny Information
Systems, Inc. is a wholly owned subsidiary of J.J. Kenny Co., Inc.
which is a wholly owned subsidiary of McGraw-Hill, Inc.
Limitations on Liability
The Trustee and the Sponsor may rely on any evaluation
furnished by the Evaluator and will have no responsibility to
Holders for its accuracy. Determinations by the Evaluator under
the Indenture will be made in good faith upon the basis of the
best information available to it. The Evaluator will not be liable
to the Trustee, the Sponsor or the Holders for errors in
judgment except in cases of wilful misfeasance, bad faith, gross
negligence or reckless disregard of its obligations and duties.
Resignation and Removal
The Evaluator may resign upon notice to the Sponsor and
Trustee, and may be removed at any time by the Sponsor. Upon
such resignation or removal, the Sponsor will use its best efforts
to appoint a successor promptly. If no successor Evaluator has
accepted appointment within thirty days after notification of
resignation or removal, the Evaluator may apply to a court for
the appointment of a successor. Resignation or removal of the
Evaluator will become effective upon appointment of a successor
Evaluator.
LEGAL OPINION
The legality of the Units offered hereby has been passed upon
for the Sponsor by Davis Polk & Wardwell, 450 Lexington
Avenue, New York, New York 10017. Emmet, Marvin & Martin,
120 Broadway, New York, New York 10271, acts as counsel for
the Trustee.
INDEPENDENT AUDITORS
The Statement of Financial Condition, including the Portfolio,
and the Statements of Operations and Changes in Net Assets of
the Fund set forth in Part A of this Prospectus have been audited
by KPMG Peat Marwick LLP, independent auditors, to the
extent indicated in their report thereon also included. Such
financial statements have been included herein in reliance upon
such report given on the authority of such firm as experts in
accounting and auditing. <PAGE>
<PAGE>
<TABLE>
THE SMITH BARNEY INC. STRIPPED ("ZERO")
U.S. TREASURY SECURITIES FUND, SERIES A
PROSPECTUS
Parts A and B of this Prospectus do not contain all of t
he information with respect to the Fund set forth in its
registration statements and exhibits relating thereto which have
been filed with the Securities and Exchange Commission,
Washington, D.C. under the Securities Act of 1933 and the
Investment Company Act of 1940, and to which reference is
hereby made.
Index to Parts A and B
<S> <C>
Investment Summary A-2
Independent Auditors Report A-5
Report of Independent Accountants A-6
Statement of Financial ConditionA-7
Statement of Operations and Changes in Net
Assets A-8
Notes to Financial StatementsA-9
PortfolioA-11
Description of the FundB-1
Sale and Redemption of Units B-4
Taxes B-7
Sponsor's ProfitsB-8
Expenses and Charges B-8
Administration of the FundB-9
Sponsor B-12
TrusteeB-12
EvaluatorB-13
Legal Opinion B-13
Independent Auditors B-13
Sponsors: Evaluator:
Trustee: Independent Auditors:
Smith Barney Inc. Kenny S&P Evaluation United
States Trust KPMG Peat Marwick
Unit Trust Department Services
Company of New York 345 Park Avenue
388 Greenwich St. 65 Broadway 114
West 47th Street New York, NY 10154
New York, New York 10013 New York, New York 10006 New
York, NY 10036 (212) 758-9700
1(800) 298-UNIT (212) 208-8580 1(800)
257-2356
No person is authorized to give any information or to make any
representations with respect to this investment company not
contained in this Prospectus, and any information or
representations not contained herein must not be relied upon as
having been authorized. This Prospectus does not constitute an
offer to sell, or a solicitation of an offer to buy, securities in any
state to any person to whom it is not lawful to make such offer
in such state.
</TABLE>
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
CONTENTS OF REGISTRATION STATEMENT
This Post-Effective Amendment to the Registration Statement
on Form S-6 comprises the following papers and documents:
- The facing Sheet on Form S-6.
- The Prospectus consisting of 29 pages
- Signatures.
Written consents of the following persons:
- KPMG Peat Marwick LLP (included as Exhibit 4.1A)
- Coopers & Lybrand, L.L.P. (included as Exhibit 4.1B)
- Kenny S&P Evaluation Services (included in Exhibit
4.2)
The following exhibits:
1.1 Restated Certificate of Incorporation of Smith
Barney Inc., as amended August 2, 1993
(incorporated by reference to Exhibit 3(i) to the
Registration Statement of Tax Exempt Securities
Trust, Series 377, Reg. No. 33-65332).
1.2 Bylaws of Smith Barney Inc. (incorporated by
reference to Exhibit 3(ii) to the Registration
Statement of Tax Exempt Securities Trust, Series
327, Reg. No. 33-36037).
4.1A Consent of KPMG Peat Marwick LLP.
4.1B Consent of Coopers & Lybrand L.L.P.
4.2 Consent of Kenny S&P Evaluation Services.
II-1
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant, The Smith Barney Inc. Stripped ("Zero") U.S.
Treasury Securities Fund, Series A (A Unit Investment Trust),
certifies that it meets all of the requirements for effectiveness of
this Registration Statement pursuant to Rule 485(b) under the
Securities Act of 1933 and has duly caused this Registration
Statement or Amendment thereto to be signed on its behalf by
the undersigned thereunto duly authorized in the City of New
York and State of New York on the 2nd day of May, 1995.
THE SMITH
BARNEY INC. FUND
OF
STRIPPED ("ZERO") U.S. TREASURY
SECURITIES, SERIES A
(Registrant)
Signatures appear on page II-3
A majority of the members of the Board of Directors of
Smith Barney Inc. has signed this Registration Statement or
Amendment to the Registration Statement pursuant to Powers of
Attorney authorizing the person signing this Registration
Statement or Amendment to the Registration Statement to do so
on behalf of such members.
II-2
<PAGE>
Smith Barney INC.
Depositor
By the following persons, who constitute a majority of
Powers of Attorney have been filed under
the Board of Directors of Smith Barney Inc.:
the following 1933 Act File
Numbers: 33-56722 and 33-51999
STEVEN D. BLACK
JAMES BOSHART III
ROBERT A. CASE
JAMES DIMON
ROBERT DRUSKIN
ROBERT F. GREENHILL
JEFFREY LANE
ROBERT H. LESSIN
JACK L. RIVKIN
By GINA LEMON
(As authorized signatory for
Smith Barney Inc. and
Attorney-in-fact for the persons listed above)
II-3
<PAGE>
Exhibit 4.1A
CONSENT OF Independent AUDITORS
We consent to the use of our report dated February 17,
1995, on the statement of financial condition of the Smith Barney
Fund of Stripped ("Zero") U.S. Treasury Securities, Series A,
formerly The Smith Barney Shearson Fund of Stripped ("Zero")
U.S. Treasury Securities, Series A, (comprised of the 1995 and
the 2004 Trust), including the related portfolios, as of December
31, 1994, and the related statements of operations and changes in
net assets and the selected supplemental information for the year
then ended, included herein and to the reference to our firm
under the heading "AUDITORS" in the prospectus.
KPMG Peat Marwick LLP
New York, New York
March 14, 1995
<PAGE>
<PAGE>
Exhibit 4.1B
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the inclusion in this Post-Effective Amendement
No. 10 to the Registration Statement on Forms S-6 (File No. 2-
98383) of our report dated February 24, 1994, on our examination
of the financial statements of The Smith Barney Shearson Fund
of Stripped ("Zero") U.S. Treasury Securities, Series A.
COOPERS & LYBRAND, L.L.P.
New York, New York
May 2, 1995
<PAGE>
<PAGE>
KENNY S&P EVALUATION SERVICES
A Division of Kenny Information Systems, Inc.
65 Broadway
New York, New York, 10006-2511
Telephone 212/770-4000
Smith Barney Incorporated
388 Greenwich Street
New York, NY 10013
RE: The Smith Barney Fund of Stripped ("Zero")
U.S. Treasury Securities Fund, Series A
Gentlemen:
We have examined the post-effective Amendment to
the Registration Statement
File No. 2-98383 for the above-captioned trust. We hereby
acknowledge that Kenny S&P Evaluation Services, a division
of Kenny Information Systems, Inc. is currently acting as the
evaluator for the trust. We hereby consent to the use in the
Amendment of the reference to Kenny S&P Evaluation
Services, a division of Kenny Information Systems, Inc. as
evaluator.
In addition, we hereby confirm that the ratings
indicated in the above-referenced Amendment to the
Registration Statement for the respective bonds comprising
the trust portfolio are the ratings currently indicated in our
KENNYBASE database.
You are hereby authorized to file a copy of this letter
with the Securities and Exchange Commission.
Sincerely,
Frank A. Ciccotto
