File No. 33-90620 CIK No. 0000943057
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549-1004
POST-EFFECTIVE
AMENDMENT NO. 1
TO
FORM S-6
For Registration under the Securities Act of 1933 of
Securities of Unit Investment Trusts Registered on
Form N-8B-2
LEGG MASON UNIT INVESTMENT TRUST, SERIES 5
(EXACT NAME OF TRUST)
LEGG MASON WOOD WALKER, INCORPORATED
(EXACT NAME OF DEPOSITOR)
111 S. Calvert St.
Baltimore, Maryland 21202
(Complete address of Depositor's principal executive offices)
Legg Mason Wood Walker, Incorporated Chapman and Cutler
Attention: Marie K. Karpinski Attention: Mark J. Kneedy
111 S. Calvert St. 111 West Monroe Street
Baltimore, Maryland 21202 Chicago, Illinois 60603
(Name and complete address of agents for service)
( X ) Check if it is proposed that this filing will become effective on
April 30, 1996 pursuant to paragraph (b) of Rule 485.
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LEGG MASON UNIT INVESTMENT TRUST, SERIES 5
LEGG MASON REGIONAL BANK AND THRIFT TRUST, SERIES 1
2,136,148 UNITS
PROSPECTUS
Part One
Dated April 30, 1996
Note: Part One of this Prospectus may not be distributed unless accompanied
by Part Two
The Trust
Legg Mason Unit Investment Trust, Series 5 (the "Fund"),
which consists of the Legg Mason Regional Bank and Thrift
Trust, Series 1 (the "Trust"), is a unit investment trust
registered under the Investment Company Act of 1940, as
amended ("1940 Act"). The Trust was formed with the
investment objective of obtaining maximum capital
appreciation over the life of the Trust through investment
in a fixed portfolio of equity securities of companies
diversified within the regional banking and thrift
industries which the Sponsor believed, at the Trust's
Initial Date of Deposit, would outperform other banking and
financial stocks. At December 31, 1995, each Unit
represented a 1/2,136,148 undivided interest in the
principal and net income of the Trust (see "The Trusts" in
Part Two).
The Units being offered by this Prospectus are issued and
outstanding Units which have been purchased by the Sponsor
in the secondary market or from the Trustee after having
been tendered for redemption. The profit or loss resulting
from the sale of Units will accrue to the Sponsor. No
proceeds from the sale of Units will be received by the
Trust.
Public Offering Price
The Public Offering Price per Unit is equal to the aggregate
underlying bid value of the Securities in the Trust, plus or
minus a pro rata share of cash, if any, in the Capital
Account of the Trust divided by the number of Units
outstanding, plus a sales charge of 3.65% (equivalent to
3.79% of the net amount invested). At December 31, 1995,
the Public Offering Price Per Unit was $25.96 (see "Public
Offering Price" in Part Two). The minimum purchase is 50
Units.
Please retain all 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.
LEGG MASON WOOD WALKER, INCORPORATED
Sponsor
<PAGE>
LEGG MASON UNIT INVESTMENT TRUST, SERIES 5
Legg Mason Regional Bank and Thrift Trust, Series 1
Essential Information
As of December 31, 1995
Sponsor: Legg Mason Wood Walker, Incorporated
Evaluator: Gray, Seifert & Company, Inc.
Trustee: The Bank of New York
<TABLE>
<CAPTION>
<S> <C>
Number of Units 2,136,148
Fractional Undivided Interest Per unit 1/2,136,148
Public Offering Price:
Aggregate Value of Securities in Portfolio(1) $53,441,157
Aggregate Value of Securities per Unit $25.02
Income and Capital Accounts in Portfolio ($12,206)
Income and Capital Accounts per Unit ($.01)
Plus Sales Charge of 3.65%
(3.79% of the net amount invested)(2) $0.95
Public Offering Price Per Unit $25.96
Redemption Price and Sponsor's Repurchase Price Per Unit $25.01
Excess of Public Offering Price Per Unit over
Redemption Price Per Unit $0.95
Maximum Value of the Trust under which Trust Agreement may be Trust Agreement may be terminated
Terminated if value of the Trust is less than
$16,465,430
Evaluations for purpose of sale, purchase or redemption of Units of the Trust
are made as of 4:00 p.m., Eastern Time, next following receipt of an order
for a sale or purchase of Units or receipt by the Trustee of Units tendered
for redemption (the "Evaluation Time")
Date Trust Established May 23, 1995
Mandatory Termination Date May 31, 1999
Liquidation Period Beginning on May 1, 1999 until no
later than the Mandatory
Termination Date
Evaluator's Annual Evaluation Fee Maximum of $.0060 per Unit
Trustee's Annual Fee $.0172 per Unit
Sponsor's Annual Supervisory Fee Maximum of $.005 per Unit
Estimated Annual Organizational Expenses(3) $.006075 per Unit
Record and Computation Dates FIFTEENTH day of June and December
Distribution Dates LAST day of June and December
</TABLE>
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(1) Each Security listed on a national securities exchange is valued at the
last sales price, or if the Security is not listed on a national
securities exchange, at the last bid price in the over-the-counter
market.
(2) The sales charge will be reduced for certain purchases as set forth under
"Public Offering of Units - Public Offering Price."
(3) The Trust (and therefore Unitholders) will bear all or a portion of its
organizational costs (including costs of preparing the registration
statement, the trust indenture and
<PAGE>
other closing documents, registering Units with the Securities and
Exchange Commission and states, the initial audit of the Trust portfolio
and the initial fees and expenses of the Trustee but not including the
expenses incurred in the printing of preliminary prospectuses and final
prospectuses, expenses incurred in the preparation and printing of
brochures and other advertising materials and any other selling expenses)
as is common for mutual funds. Total organizational expenses will be
amortized over the life of the Trust. See "Expenses of the Trust."
Historically, the sponsors of unit investment trusts have paid all the
costs of establishing such trusts.
<PAGE>
Report of Ernst & Young LLP, Independent Auditors
To the Unitholders of
Legg Mason Unit Investment Trust, Series 5
(Legg Mason Regional Bank and Thrift Trust, Series 1):
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments, of Legg Mason Unit Investment Trust, Series 5,
comprising the Legg Mason Regional Bank and Thrift Trust, Series 1, as of
December 31, 1995, and the related statements of operations and changes in net
assets for the period May 23, 1995 (Initial Date of Deposit) to December 31,
1995. These financial statements are the responsibility of the Trust's Sponsor.
Our responsibility is to express an opinion on these financial statements based
on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures included
confirmation of securities owned as of December 31, 1995, by correspondence with
the Trustee. An audit also includes assessing the accounting principles used and
significant estimates made by the Sponsor, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Legg Mason Unit Investment
Trust, Series 5, comprising the Legg Mason Regional Bank and Thrift Trust,
Series 1, at December 31, 1995, and the results of its operations and changes in
its net assets for the period May 23, 1995 (Initial Date of Deposit) to December
31, 1995, in conformity with generally accepted accounting principles.
Baltimore, Maryland
February 27, 1996
1
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Legg Mason Unit Investment Trust, Series 5
(Legg Mason Regional Bank and Thrift Trust, Series 1)
Statement of Assets and Liabilities
December 31, 1995
Assets:
Securities, at value (cost $41,163,575) (Note 1) $ 53,441,157
Cash (overdraft) (90,626)
Dividends receivable 102,599
Deferred organizational expenses 43,662
Total assets 53,496,792
Liabilities:
Accrued expenses 16,349
Other liabilities 51,492
Total liabilities 67,841
Net assets $ 53,428,951
Analysis of net assets:
Accumulated paid-in capital (2,136,148 units of
fractional undivided interest) $ 41,151,369
Unrealized gain on investments 12,277,582
Net assets $ 53,428,951
Net asset value per unit $25.01
See accompanying notes to financial statements.
2
<PAGE>
Legg Mason Unit Investment Trust, Series 5
(Legg Mason Regional Bank and Thrift Trust, Series 1)
Schedule of Investments
December 31, 1995
Number of
Shares Name of Issuer Market Value
23,500 AmFed Financial, Inc. $ 790,188
6,250 (1) Associated BancCorp 253,125
52,000 Bankcorp Hawaii, Inc. 1,865,500
32,000 Barnett Banks, Inc. 1,888,000
44,000 Boatmen's Bancshares, Inc. 1,798,500
18,000 CCB Financial Corporation 994,500
58,000 Centura Banks, Inc. 2,037,250
26,250 (2) Commerce Bancshares, Inc. 997,500
33,000 Crestar Financial Corporation 1,951,125
41,300 Cullen/Frost Bankers, Inc. 2,054,675
29,000 Fifth Third Bancorp 2,102,500
42,000 First American Corporation 1,989,750
44,000 First Financial Corporation 990,000
60,000 First Security Corporation 2,280,000
16,200 First Virginia Banks, Inc. 676,350
15,000 (3) First Western Bancorp, Inc. 405,000
20,000 Fort Wayne National Corporation 630,000
45,000 Fourth Financial Corporation 1,822,500
41,000 Hawkeye Bancorporation 1,091,625
90,000 Hibernia Corporation 967,500
43,000 Integra Financial Corporation 2,709,000
21,000 Liberty Bancorp, Inc. 782,250
70,000 Marshall & Ilsley Corporation 1,811,250
41,000 Mercantile Bankshares Corporation 1,127,500
52,000 National City Corporation 1,722,500
85,000 North Fork Bancorporation, Inc. 2,146,250
53,000 Norwest Corporation 1,749,000
60,000 Peoples Heritage Financial Group, Inc. 1,350,000
18,000 (*) Silicon Valley Bancshares 432,000
67,000 Southern National Corporation 1,758,750
27,000 Suntrust Banks, Inc. 1,849,500
66,000 (4) TCF Financial Corporation 2,186,250
50,000 UJB Financial Corporation 1,787,500
14,000 Victoria Bankshares, Inc. 472,500
82,614 (5) US Bancorp 2,767,569
15,000 Zions Bancorporation 1,203,750
$ 53,441,157
3
<PAGE>
Legg Mason Unit Investment Trust, Series 5
(Legg Mason Regional Bank and Thrift Trust, Series 1)
Notes to Schedule of Investments
December 31, 1995
(1) The number of shares reflects the effect of a five for four stock split.
(2) The number of shares reflects the effect of a 5% stock dividend.
(3) The number of shares reflects the effect of a three for two stock split.
(4) The number of shares reflects the effect of a two for one stock split.
(5) The number of shares and name of issuer reflect the effect of the
acquisition of West One Bancorp by US Bancorp whereby West One Bancorp
shareholders received 1.47 shares of US Bancorp for each share of West One
Bancorp held.
(*) Non-income producing.
See accompanying notes to financial statements.
4
<PAGE>
Legg Mason Unit Investment Trust, Series 5
(Legg Mason Regional Bank and Thrift Trust, Series 1)
Statement of Operations
For the Period May 23, 1995
(Initial Date of Deposit) to December 31, 1995
Investment income:
Dividends $ 854,894
Expenses:
Trustee's fees and expenses 22,558
Evaluator's fees 7,794
Supervisory fees 6,496
Amortization of organizational expense 7,830
Other 4,042
Total expenses 48,720
Net investment income 806,174
Net unrealized gain on investments 12,277,582
Increase in net assets resulting from operations $13,083,756
See accompanying notes to financial statements.
5
<PAGE>
Legg Mason Unit Investment Trust, Series 5
(Legg Mason Regional Bank and Thrift Trust, Series 1)
Statement of Changes in Net Assets
For the Period May 23, 1995
(Initial Date of Deposit) to December 31, 1995
From operations:
Net investment income $ 806,174
Net unrealized gain on investments 12,277,582
Increase in net assets resulting from operations 13,083,756
Distributions to unitholders from:
Net investment income (806,174)
Return of capital (12,206)
(818,380)
Increase in net assets 12,265,376
Net assets:
Beginning of period 41,163,575
End of period $53,428,951
See accompanying notes to financial statements.
6
<PAGE>
Legg Mason Unit Investment Trust, Series 5
(Legg Mason Regional Bank and Thrift Trust, Series 1)
Notes to Financial Statements
1. Significant Accounting Policies
Security Valuation
The Trust's securities are stated at the last sale price for securities listed
on a national securities exchange and at the last bid value for securities which
are traded in the over-the-counter market as reported by the Trust's Evaluator.
Security Cost
The aggregate cost of the securities is based on the market value of such
securities on the date the securities were deposited in the Trust.
Investment Income
Dividends are recorded on the ex-dividend date.
Expenses of the Trust
The Trust pays an annual fee for Trustee services to The Bank of New York of
$.0172 per Unit based on the largest number of Units outstanding during the
calendar year for which such compensation relates. The Evaluator, Gray, Seifert
& Company, an affiliate of the Sponsor, receives an annual fee of $.006 per Unit
based on the largest number of Units outstanding during the calendar year for
which such compensation relates. The Trust also pays recurring financial
reporting costs and an annual supervisory fee payable to the Sponsor.
Deferred organizational costs are being amortized on a straight-line basis over
four years from the Date of Deposit.
Federal Income Taxes
No provision for federal income or excise taxes is required since the Trust
intends to qualify as a regulated investment company and distribute all of its
taxable income to its unitholders.
7
<PAGE>
Legg Mason Unit Investment Trust, Series 5
(Legg Mason Regional Bank and Thrift Trust, Series 1)
Notes to Financial Statements (continued)
2. Trust Sponsor and Redemption
Although not obligated to do so, Legg Mason Wood Walker, Incorporated, the Trust
Sponsor, intends, subject to change at any time, to maintain a market for Units
of the Trust and to continuously offer to purchase Units at prices, determined
by the Evaluator, based on the last sale price for securities listed on a
national securities exchange and on the last bid value for securities which are
traded in the over-the-counter market. The Sponsor may discontinue purchases of
the Units if the supply of Units exceeds demand or for other business reasons.
In the event that a market is not maintained for the Units, a unitholder may
tender his Units to the Trustee for redemption at the redemption price as set
forth in the Prospectus.
The Trust Sponsor does not charge the Trust any fees for services performed as
Sponsor but does receive an annual supervisory fee of $.005 per Unit based on
the largest number of Units outstanding during the calendar year for which such
compensation relates.
3. Unrealized Appreciation and Depreciation
At December 31, 1995, the cost of securities for federal income tax purposes was
$41,163,575. Net unrealized appreciation and aggregate gross unrealized
appreciation for all securities for which there was an excess of value over tax
cost was $12,277,582. There was no unrealized depreciation for any securities
held by the Trust.
4. Unit Cost to Investors
The unit cost to initial investors of $20.00 was based on the aggregate
underlying value of the securities on the date of the investor's purchase, plus
a sales charge of 3.65% of the Public Offering Price which was equivalent to
3.79% of the net amount invested.
8
<PAGE>
Legg Mason Unit Investment Trust, Series 5
(Legg Mason Regional Bank and Thrift Trust, Series 1)
Notes to Financial Statements (continued)
5. Per Unit Information
For the Period
May 23, 1995 (Initial
Date of Deposit) to
December 31, 1995
Investment income $ .40
Expenses (.02)
Net investment income .38
Net unrealized gain on investments 5.75
Distributions to unitholders from:
Net investment income (.38)
Return of capital (.01)
(.39)
Increase in net assets 5.74
Net asset value:
Beginning of period 19.27
End of period $25.01
9
<PAGE>
Legg Mason Unit Investment Trust
Legg Mason Regional Bank and Thrift Trust Series
PROSPECTUS NOTE: This Part Two Prospectus must be
PART TWO accompanied by Part One of this
DATED April 30, 1996 Prospectus.
Legg Mason Regional Bank and Thrift Trust Series (the "Trusts") were formed
with the investment objective of obtaining maximum capital appreciation through
investment in a fixed portfolio of equity securities of companies diversified
within the regional banking and thrift industries which Legg Mason Wood Walker,
Incorporated (the "Sponsor"), believed at each Trust's Initial Date of Deposit
would outperform other banking and financial stocks. The securities selected
were considered by the Sponsor to have the potential to achieve each Trust's
objective over the term of the Trusts. See " The Trust Portfolio." There is no
assurance that the Trusts will achieve their objective.
Units of the Trusts are not deposits or obligations of, or guaranteed by,
any bank, and Units are not federally insured or otherwise protected by the
Federal Deposit Insurance Corporation and involve investment risk including loss
of principal.
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.
All parts of this Prospectus should be read and retained for future
reference.
Legg Mason Wood Walker
Incorporated
111 South Calvert Street
P.O. Box 1476
Baltimore, Maryland 21203-1476
(410) 539-0000/(800) 822-5544
<PAGE>
Summary
The Trusts. Legg Mason Unit Investment Trust Series (the "Fund"), which
consists of the Legg Mason Regional Bank and Thrift Trust Series (the "Trusts"),
is a series of unit investment trusts registered under the Investment Company
Act of 1940, as amended ("1940 Act").
Each Trust consists of common stocks issued by the companies set forth in
"Schedule of Investments" in Part One for each Trust (the "Securities"). For the
criteria used by the Sponsor in selecting the Securities, see "The Trust
Portfolio--Securities Selection." The value of all portfolio Securities and,
therefore, the value of the Units may be expected to fluctuate in value
depending on the full range of economic and market influences affecting
corporate profitability, the financial condition of issuers and the prices of
equity securities in general and the Securities in particular. Maximum capital
appreciation is, of course, dependent upon several factors, including, among
other things, the financial condition of the issuers of the Securities, and
therefore, there can be no assurance that maximum capital appreciation will be
achieved (see "The Trust Portfolio"). Each Trust was formed with the investment
objective of obtaining maximum capital appreciation over the life of the
respective Trust through investment in a fixed portfolio of equity securities of
companies diversified within the regional banking and thrift industries which
the Sponsor believed at each Trust's Initial Date of Deposit would outperform
other banking and financial stocks. Of course, achievement of the objective
assumes that the Securities will continue to provide maximum capital
appreciation for the life of the Trust.
As of the date of Part One of this Prospectus, each Unit of a Trust
represents that undivided interest in such Trust indicated under "Essential
Information" in Part One. To the extent that any Units are redeemed by the
Trustee, the fractional undivided interest in such Trust represented by each
unredeemed Unit will increase, although the actual interest in the Trust
represented by such fraction will remain unchanged. Units will remain
outstanding until redeemed upon tender to the Trustee by Unitholders, which may
include the Sponsor, or until the termination of the Trust Agreement.
Public Offering Price. The Public Offering Price per Unit of the Trust is
based on the aggregate underlying bid value (see "Public Offering of Units --
Public Offering Price") of the Securities in the Trust plus or minus a pro rata
share of cash, if any, in the Capital Account (as hereinafter defined) held or
owned by a Trust, plus a sales charge of 3.65% (equivalent to 3.79% of the net
amount invested).
Distributions of Income and Capital. Distributions of dividends received by
a Trust and any funds in the Capital Account will be made semi-annually. See
"Unitholders--Distributions to Unitholders."
Market for Units. While under no obligation to do so, the Sponsor intends
to maintain a market for the Units of the Trusts and offer to repurchase such
Units at prices subject to change at any time which are based on the current
underlying bid prices of the Securities in
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<PAGE>
the Trusts. If the supply of Units exceeds demand or if some other business
reason warrants it, the Sponsor may either discontinue all purchases of Units or
discontinue purchases of Units at such prices. A Unitholder may also dispose of
Units through redemption at the Redemption Price on the date of tender to the
Trustee. See "Redemption--Computation of Redemption Price."
Termination. No later than the date specified under the Liquidation Period
in "Essential Information" in Part One of this Prospectus, Securities will begin
to be sold in connection with the termination of the Trust and it is expected
that all Securities in the Trust will be sold by the Mandatory Termination Date
(as defined in "Essential Information" in Part One of this Prospectus) or within
a reasonable period of time thereafter. The Sponsor will determine the manner,
timing and execution of the sale of the underlying Securities. See
"Administration of the Trust-- Amendment and Termination."
Risk Factors. An investment in the Trusts should be made with an
understanding of the risks associated therewith, including the possible
deterioration of either the financial condition of the issuers or the general
condition of the stock market. For certain risk considerations related to the
Trusts, see "Risk Factors."
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<PAGE>
The Trusts
Legg Mason Unit Investment Trust Series, which consists of the Legg Mason
Regional Bank and Thrift Trust Series, is a series of unit investment trusts
created under the laws of the State of New York pursuant to a trust indenture
dated as of each Trust's Initial Date of Deposit (the "Trust Agreement") between
Legg Mason Wood Walker, Incorporated (the "Sponsor"), and The Bank of New York
(the "Trustee").*
Each Trust's portfolio contains common stocks issued by companies
diversified within the regional banking and thrift industries. As used herein,
the term "Securities" means the common stocks initially deposited in a Trust and
described in the portfolio and any additional common stocks acquired and held by
the Trust, pursuant to the provisions of the Trust Agreement.
Each Trust consists of (a) the Securities listed under "Schedule of
Investments" in Part One of this Prospectus as may continue to be held from time
to time in such Trust, (b) any additional Securities acquired and held by the
Trust pursuant to the provisions of the Trust Agreement and (c) any cash held in
the Income and Capital Accounts. Neither the Sponsor nor the Trustee shall be
liable in any way for any failure in any of the Securities.
The Trust Portfolio
Securities Selection. At all times each Trust will hold at least 80% of its
assets in equity securities issued by companies diversified within the regional
banking and thrift industries. In selecting Securities for the Trusts, the
following factors, among others, were considered by the Sponsor at each Trust's
Date of Deposit: (a) the quality of the Securities, (b) the price of the
Securities relative to other similar securities, (c) the potential for capital
appreciation of the Securities and (d) the potential benefit to the issuer of
the Securities from the continued consolidation within the regional banking and
thrift industries and improving industry fundamentals.
In selecting the Securities for the Trusts, the Sponsor chose equity
securities that in its view had the potential for capital appreciation. Although
there can be no assurance that such Securities will appreciate in value over the
life of the Trusts, over time stock investments have generally outperformed most
other asset classes. However, it should be understood that common stocks carry
greater risks, including the risk that the value of an investment can decrease
(see "Risk Factors"), and past performance is no guarantee of future results.
The Trusts will not invest in banks or thrifts that have lending arrangements
with affiliates of the Trusts as of the Date of Deposit.
_____
*Reference is made to the Trust Agreement and any statement contained herein is
qualified in its entirety by the provisions of the Trust Agreement.
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<PAGE>
In offering the Units to the public, the Sponsor is not recommending any of
the individual Securities in the Trusts but rather the entire pool of
Securities, taken as a whole, which are represented by the Units.
Risk Factors
General. The Trusts may be an appropriate investment vehicle for investors
who desire to participate in a portfolio of equity securities with greater
diversification than they might be able to acquire individually. An investment
in Units of the Trusts should be made with an understanding of the risks
inherent in an investment in equity securities, including: (a) the risk that the
financial condition of the issuers of the Securities may become impaired, (b)
the risk that the general condition of the stock market may worsen (both of
which may contribute directly to a decrease in the value of the Securities and
thus in the value of the Units) and (c) the risk that holders of common stock
have a right to receive payments from the issuers of those stocks that is
generally inferior to that of creditors of, or holders of debt obligations
issued by, the issuers and that the rights of holders of common stock generally
rank inferior to the rights of holders of preferred stock. Common stocks are
especially susceptible to general stock market movements and to volatile
increases and decreases in value as market confidence in, and perceptions of,
the issuers change. These perceptions are based on unpredictable factors,
including expectations regarding government, economic, monetary and fiscal
policies, inflation and interest rates, economic expansion or contraction, and
global or regional political, economic or banking crises.
An investment in Units of the Trusts should be made with an understanding
of the problems and risks inherent in the financial institutions industry in
general. Banks, thrifts and their holding companies are especially subject to
the adverse effects of economic recession, volatile interest rates, portfolio
concentrations in geographic markets and in commercial and residential real
estate loans, and competition from new entrants in their fields of business.
Banks and thrifts are highly dependent on net interest margin. Recently bank
profits have come under pressure as net interest margins have contracted, but
volume gains have been strong in both commercial and consumer products. There is
no certainty that these conditions will continue. Bank and thrift institutions
had received significant consumer mortgage fee income as a result of activity in
the mortgage and refinance markets. As initial home purchasing and refinancing
activity subsided, this income diminished. Economic conditions in the real
estate markets, which have been weak in the past, can have a substantial effect
upon banks and thrifts because they generally have a portion of their assets
invested in loans secured by real estate. Banks, thrifts and their holding
companies are subject to extensive federal regulation and, when such
institutions are state-chartered, to state regulation as well. Such regulations
impose strict capital requirements and limitations on the nature and extent of
business activities that banks and thrifts may pursue. Furthermore, bank
regulators have a wide range of discretion in connection with their supervisory
and enforcement authority and may substantially restrict the permissible
activities of a particular institution if deemed to pose significant risks to
the soundness of such institution or the safety of the federal deposit
insurance fund. Regulatory actions, such as increases in the minimum capital
requirements applicable to banks and increases in deposit insurance premiums
required to be paid by banks to the Federal Deposit Insurance Corporation
-5-
<PAGE>
(" FDIC"), can negatively impact earnings and the ability of a company to pay
dividends. In addition, federal legislation is currently pending before Congress
which would require a significant one-time charge to be assessed to thrifts in
order to bolster depleted deposit insurance funds. To the extent this or similar
legislation is adopted, thrift earnings and profitability will be negatively
impacted. Neither federal insurance of deposits nor governmental regulations,
however, ensure the solvency or profitability of banks or their holding
companies or insure against any risk of investment in the securities issued by
such institutions.
The statutory requirements applicable to, and regulatory supervision of,
banks, thrifts and their holding companies have increased significantly and have
undergone substantial changes in recent years. To a great extent, these changes
are embodied in the Financial Institutions Reform, Recovery and Enforcement Act,
enacted in August 1989, the Federal Deposit Insurance Corporation Improvement
Act of 1991, the Resolution Trust Corporation Refinancing, Restructuring, and
Improvement Act of 1991 and the regulations promulgated under these laws. Many
of the regulations promulgated pursuant to these laws have only recently been
finalized and their impact on the business, financial condition and prospects of
the Securities in the Trust's portfolio cannot be predicted with certainty.
Failure to enact such legislation, on the other hand, may lead to declining
earnings and an inability to compete with unregulated financial institutions.
Efforts to expand the ability of federal thrifts to branch on an interstate
basis have been initially successful through promulgation of regulations, and
legislation to liberalize interstate banking has recently been signed into law.
Under the legislation, banks will be able to purchase or establish subsidiary
banks in any state, one year after the legislation's enactment. Starting in
mid-1997, banks would be allowed to turn existing banks into branches, though
states could pass laws to permit interstate branch banking before then.
Consolidation is likely to continue in both cases. The Securities and Exchange
Commission ("SEC") and the Financial Accounting Standards Board require the
expanded use of market value accounting by banks and have imposed rules
requiring market accounting for investment securities held in trading accounts
or available for sale. Adoption of additional such rules may result in increased
volatility in the reported health of the industry and mandated regulatory
intervention to correct such problems. In late 1993, the United States Treasury
Department proposed a restructuring of the bank regulatory agencies which, if
implemented, may adversely affect certain of the Securities in the Trust's
portfolio. Additional legislative and regulatory changes may be forthcoming. For
example, the bank regulatory authorities have proposed substantial changes to
the Community Reinvestment Act and fair lending laws, rules and regulations, and
there can be no certainty as to the effect, if any, that such changes would have
on the Securities in a Trust's portfolio. In addition, the deposit insurance
system is reviewed by Congress and federal regulators, from time to time, and
proposed reforms of that system could, among other things, further restrict the
ways in which deposited moneys can be used by banks or reduce the dollar amount
or number of deposits insured for any depositor. Such reforms could reduce
profitability as investment opportunities available to bank institutions become
more limited and as consumers look for savings vehicles other than bank
deposits. Banks and thrifts face significant competition from other financial
institutions such as mutual funds, credit unions, mortgage banking companies and
insurance companies, and increased competition may result from legislative
broadening of regional and national interstate
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banking powers as has been recently proposed. Among other benefits, proposed
legislation would allow banks and bank holding companies to acquire across
previously prohibited state lines and to consolidate their various bank
subsidiaries into one unit. The Sponsor makes no prediction as to what, if any,
manner of thrift regulatory reform might ultimately be adopted or what ultimate
effect such reform might have on a Trust's portfolio.
The Federal Bank Holding Company Act of 1956 generally prohibits a bank
holding company, without prior Federal Reserve Board ("FRB") approval, from (1)
acquiring, directly or indirectly, more than 5% of the outstanding shares of any
class of voting securities of a bank or bank holding company, (2) acquiring
control of a bank or another bank holding company, (3) acquiring all or
substantially all the assets of a bank, or (4) merging or consolidating with
another bank holding company. In considering an application with respect to any
such transaction, the FRB is required to consider a variety of factors,
including the potential anti-competitive effects of the transaction, the
financial condition and future prospects of the combining and resulting
institutions, the managerial resources of the resulting institution, the
convenience and needs of the communities the combined organization would serve,
the record of performance of each combining organization under the Community
Reinvestment Act and the Equal Credit Opportunity Act, and the prospective
availability to the FRB of information appropriate to determine ongoing
regulatory compliance with applicable banking laws. In addition, the federal
Change in Bank Control Act and various state laws impose limitations on the
availability of one or more individuals or other entities to acquire control of
banks or bank holding companies.
The FRB has issued a policy statement on the payment of cash dividends by
bank holding companies. In the policy statement, the FRB expressed its view that
a bank holding company experiencing earnings weaknesses should not pay cash
dividends which exceed its net income or which could only be funded in ways that
would weaken its financial health, such as by borrowing. The FRB may also impose
limitations on the payment of dividends as a condition to its approval of
certain applications, including applications for approval of mergers and
acquisitions. The Sponsor makes no prediction as to the effect, if any, such
laws will have on the Securities or whether such approvals, if necessary, will
be obtained.
Specific Risk Factors. Holders of common stock incur more risk than holders
of preferred stock and debt obligations because common stockholders, as owners
of the entity, have generally inferior rights to receive payments from the
issuer in comparison with the rights of creditors of the issuer, or of holders
of debt obligations or preferred stock issued by the issuer. Holders of common
stock of the type held by the portfolio have a right to receive dividends only
when and if, and in the amounts, declared by the issuer's Board of Directors and
to participate in amounts available for distribution by the issuer only after
all other claims on the issuer have been paid or provided for. By contrast,
holders of preferred stock have the right to receive dividends at a fixed rate
when and as declared by the issuer's Board of Directors, normally on a
cumulative basis, but do not participate in other amounts available for
distribution by the issuing corporation. Cumulative preferred stock dividends
must be paid before common stock dividends and any cumulative preferred stock
dividend omitted is added to future dividends payable to the holders of
cumulative preferred stock. Preferred stocks are also entitled to rights on
liquidation which are senior to those of
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common stocks. Moreover, common stocks do not represent an obligation of the
issuer and therefore do not offer any assurance of income or provide the degree
of protection of capital of debt securities. Indeed, the issuance of debt
securities or even preferred stock will create prior claims for payment of
principal, interest, liquidation preferences and dividends which could adversely
affect the ability and inclination of the issuer to declare or pay dividends on
its common stock or the rights of holders of common stock with respect to assets
of the issuer upon liquidation or bankruptcy. Further, unlike debt securities
which typically have a stated principal amount payable at maturity (whose value,
however, will be subject to market fluctuations prior thereto), common stocks
have neither a fixed principal amount nor a maturity and have values which are
subject to market fluctuations for as long as the stocks remain outstanding. The
value of the Securities in the portfolios thus may be expected to fluctuate over
the entire life of the Trusts to values higher or lower than those prevailing on
a Trust's Date of Deposit.
Whether or not the Securities are listed on a national securities exchange,
the principal trading market for the Securities may be in the over-the-counter
market. As a result, the existence of a liquid trading market for the Securities
may depend on whether dealers will make a market in the Securities. There can be
no assurance that a market will be made for any of the Securities, that any
market for the Securities will be maintained or of the liquidity of the
Securities in any markets made. In addition, the Trusts are restricted under the
1940 Act from selling Securities to the Sponsor. The price at which the
Securities may be sold to meet redemptions and the value of the Trusts will be
adversely affected if trading markets for the Securities are limited or absent.
Litigation and Legislation. From time to time, Congress considers proposals
to reduce the rate of the dividends-received deduction. Enactment into law of a
proposal to reduce the rate would adversely affect the after-tax return to
investors who can take advantage of the deduction. Unitholders are urged to
consult their own tax advisers. Further, at any time after a Trust's Date of
Deposit, litigation may be initiated on a variety of grounds, or legislation may
be enacted with respect to the Securities in the Trust or the issuers of the
Securities. There can be no assurance that future litigation or legislation will
not have a material adverse effect on the Trusts or will not impair the ability
of issuers to achieve their business goals.
Federal Tax Status
Each Trust is an association taxable as a corporation and intends to elect
and qualify on a continuing basis for special federal income tax treatment as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended (the "Code"). If a Trust so qualifies and timely distributes to
Unitholders 90% or more of its taxable income (without regard to its net capital
gain, i.e., the excess of its net long-term capital gain over its net short-term
capital loss), it will not be subject to federal income tax on the portion of
its taxable income (including any net capital gain) that it distributes to
Unitholders. In addition, to the extent a Trust timely distributes to
Unitholders at least 98% of its taxable income (including any net capital gain),
it will not be subject to the 4% excise tax on certain undistributed income of
regulated investment companies. Because each Trust intends to
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timely distribute its taxable income (including any net capital gain), it is
anticipated that the Trusts will not be subject to federal income tax or the
excise tax. Although all or a portion of a Trust's taxable income (including any
net capital gain) for the taxable year may be distributed to Unitholders shortly
after the end of the calendar year, such a distribution will be treated for
federal income tax purposes as having been received by Unitholders during the
calendar year just ended.
Distributions to Unitholders of a Trust's taxable income (other than its
net capital gain) will be taxable as ordinary income to Unitholders. To the
extent that distributions to a Unitholder in any year exceed a Trust's current
and accumulated earnings and profits, they will be treated as a return of
investment and will reduce the Unitholder's adjusted basis in his Units and, to
the extent that they exceed his basis, will be treated as a gain from the sale
of his Units as discussed below.
Distributions of a Trust's net capital gain which are properly designated
as capital gain dividends by a Trust will be taxable to Unitholders as long-term
capital gain, regardless of the length of time the Units have been held by a
Unitholder. A Unitholder may recognize a taxable gain or loss if the Unitholder
sells or redeems his Units. Any gain or loss arising from (or treated as arising
from) the sale or redemption of Units will be a capital gain or loss, except in
the case of a dealer or a financial institution. For taxpayers other than
corporations, net capital gains are presently subject to a maximum stated
marginal tax rate of 28%. However, it should be noted that legislative proposals
are introduced from time to time that affect tax rates and could affect relative
differences at which ordinary income and capital gains are taxed. A capital loss
is long-term if the asset is held for more than one year and short-term if held
for one year or less. If a Unitholder holds Units for six months or less and
subsequently sells such Units at a loss, the loss will be treated as a long-term
capital loss to the extent that any capital gain distribution is made with
respect to such Units during the six-month period or less that the Unitholder
owns the Units.
The Revenue Reconciliation Act of 1993 (the "Act") raised tax rates on
ordinary income while capital gains remain subject to a 28% maximum stated rate
for taxpayers other than corporations. Because some or all capital gains are
taxed at a comparatively lower rate under the Act, the Act includes a provision
that would recharacterize capital gains as ordinary income in the case of
certain financial transactions that are "conversion transactions" effective for
transactions entered into after April 30, 1993. Unitholders and prospective
investors should consult with their tax advisers regarding the potential effect
of this provision on their investment in Units.
Distributions which are taxable as ordinary income to Unitholders will
constitute dividends for federal income tax purposes.
The federal tax status of each year's distributions will be reported to
Unitholders and to the Internal Revenue Service. The foregoing discussion
relates only to the federal income tax status of the Trusts and to the tax
treatment of distributions by the Trusts to U.S. Unitholders. Unitholders that
are not U.S. citizens or residents should be aware that distributions from a
Trust will generally be subject to a withholding tax of 30%, or a lower
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treaty rate, and should consult their own tax advisers to determine whether
investment in the Trust is appropriate. Units in the Trusts and Trust
distributions may also be subject to state and local taxation and Unitholders
should consult their own tax advisers in this regard.
Under the Code, certain miscellaneous itemized deductions, such as
investment expenses, tax return preparation fees and employee business expenses,
will be deductible by individuals only to the extent they exceed 2% of adjusted
gross income. Miscellaneous itemized deductions subject to this limitation under
present law do not include expenses incurred by a Trust so long as the Units are
held by or for 500 or more persons at all times during the taxable year. In the
event the Units are held by fewer than 500 persons, additional taxable income
will be realized by the individual (and other noncorporate) Unitholders in
excess of the distributions received by the Unitholder.
Each Unitholder will be requested to provide his or her taxpayer
identification number to the Trustee and to certify that the Unitholder has not
been notified that payments to the Unitholder are subject to back-up
withholding. If the proper taxpayer identification number and appropriate
certification are not provided when requested, distributions by a Trust to such
Unitholder (including amounts received upon the redemption of Units) will be
subject to federally prescribed back-up withholding. Distributions by a Trust
will generally be subject to United States income taxation and withholding in
the case of Units held by non-resident alien individuals, foreign corporations
or other non-United States persons. Such persons should consult their tax
advisers.
Unitholders will be notified annually of the amounts of income dividends
includable in the Unitholder's gross income and amounts of Trustee expenses
which may be claimed as itemized deductions.
Dividend income and distributions of capital gains may also be subject to
state and local taxes. Investors should consult their tax advisers for specific
information on the tax consequences of particular types of distributions.
Unitholders desiring to purchase Units for tax-deferred plans and
Individual Retirement Accounts ("IRAs") should consult their investment
executive for details on establishing such accounts. Units may also be purchased
by persons who already have self-directed plans established.
Public Offering of Units
Public Offering Price;. Units of the Trusts are offered at a price based on
the aggregate underlying value of the Securities in the Trust plus a pro rata
share of any accumulated dividends in the Income Account of a Trust, plus a
sales charge of 3.65% (equivalent to 3.79% of the net amount invested). Such
underlying value shall also include the proportionate share of any undistributed
cash held in the Capital Account of the Trust.
The Sponsor intends to permit officers, directors and employees of the
Sponsor and its affiliates and, at the Sponsor's discretion, investment clients
of the Sponsor in certain
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accounts subject to a comprehensive "wrap fee" to purchase Units of the Trusts
without a sales charge, although a transaction processing fee may be imposed on
such trades.
As indicated above, the Public Offering Price of the Units as of the date
of Part One of this Prospectus as set forth in "Essential Information" in Part
One was established by adding to the determination of the aggregate underlying
value of the Securities a sales charge equal to 3.79% of such value and dividing
the sum so obtained by the number of Units outstanding. Such underlying value
shall include the proportionate share of any cash held in the Capital Account.
This computation produces a gross underwriting profit equal to 3.65% of the
Public Offering Price. Such price determination as of the date of the Part One
of this Prospectus was made on the basis of an evaluation of the Securities in
the Trusts, which was prepared by the Trustee.
The Evaluator will appraise or cause to be appraised daily the value of the
underlying Securities as of the Evaluation Time on days the New York Stock
Exchange, Inc. ("Exchange") is open and will adjust the Public Offering Price of
the Units commensurate with such valuation. Such Public Offering Price will be
effective for all orders received at or prior to the Evaluation Time on each
such day. Orders received by the Trustee, Sponsor or any dealer for purchases,
sales or redemptions after that time, or on a day when the Exchange is closed,
will be held until the next determination of price.
The value of the Securities will generally be determined on each business
day by the Evaluator based on the last sales prices for Securities listed on a
national securities exchange and on the last bid prices for Securities traded
over-the-counter during the secondary market and for redemptions or by taking
into account the same factors referred to under "Redemption - Computation of
Redemption Price."
The minimum purchase is 50 Units.
Public Distribution of Units. Units will be offered at a price determined
in the manner provided above.
The Sponsor intends to qualify Units of the Trust for sale in a number of
states. The Sponsor reserves the right to reject, in whole or in part, any order
for the purchase of Units.
Sponsor Profits;. The Sponsor will receive gross sales charges equal to the
percentage of the Public Offering Price of the Units of the Trust as stated
under "Public Offering Price."
Market for Units
While not obligated to do so, the Sponsor intends, subject to change at any
time, to maintain a market for Units of the Trusts offered hereby and to
continuously offer to purchase said Units at prices, determined by the
Evaluator, based on the last sales prices for Securities listed on a national
securities exchange and on the last bid value of the underlying
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Securities which are traded in the over-the-counter market. UNITHOLDERS WHO WISH
TO DISPOSE OF THEIR UNITS SHOULD INQUIRE OF THEIR INVESTMENT EXECUTIVE AS TO
CURRENT MARKET PRICES IN ORDER TO DETERMINE WHETHER THERE IS IN EXISTENCE ANY
PRICE IN EXCESS OF THE REDEMPTION PRICE AND, IF SO, THE AMOUNT THEREOF. The
offering price of any Units resold by the Sponsor will be in accordance with
that described in the currently effective Prospectus describing such Units. Any
profit or loss resulting from the resale of such Units will belong to the
Sponsor. The Sponsor may suspend or discontinue purchases of Units of the Trusts
if the supply of Units exceeds demand, or for other business reasons.
Redemption
General. A Unitholder who does not dispose of Units in the secondary
market described above may cause Units to be redeemed by the Trustee by making a
written request to the Trustee, at its Unit Investment Trust Division, 101
Barclay Street, 20th Floor, New York, New York 10286, and, in the case of Units
evidenced by a certificate, by tendering such certificate to the Trustee,
properly endorsed or accompanied by a written instrument or instruments of
transfer in form satisfactory to the Trustee. Unitholders must sign the request,
and such certificate or transfer instrument, exactly as their names appear on
the records of the Trustee and on any certificate representing the Units to be
redeemed. Additional documentation may be requested, and a signature guarantee
is always required, from corporations, executors, administrators, trustees,
guardians or associations. The signatures must be guaranteed by a participant in
the Securities Transfer Agents Medallion Program ("STAMP") or such other
signature guaranty program in addition to, or in substitution for, STAMP, as may
be accepted by the Trustee. A certificate should only be sent by registered or
certified mail for the protection of the Unitholder. Since tender of the
certificate is required for redemption when one has been issued, Units
represented by a certificate cannot be redeemed until the certificate
representing such Units has been received by the purchasers.
Redemption shall be made by the Trustee on the third business day following
the day on which a tender for redemption is received (the "Redemption Date") by
payment of cash equivalent to the Redemption Price for the Trust, determined as
set forth below under "Computation of Redemption Price," as of the Evaluation
Time stated under "Essential Information" in Part One of this Prospectus, next
following such tender, multiplied by the number of Units being redeemed. Any
Units redeemed shall be cancelled and any undivided fractional interest in the
Trust extinguished. The price received upon redemption might be more or less
than the amount paid by the Unitholder depending on the value of the Securities
in a Trust at the time of redemption.
Under regulations issued by the Internal Revenue Service, the Trustee is
required to withhold a specified percentage of the principal amount of a Unit
redemption if the Trustee has not been furnished the redeeming Unitholder's
taxpayer identification number in the manner required by such regulations. Any
amount so withheld is transmitted to the Internal Revenue Service and may be
recovered by the Unitholder only when filing a tax return. Under normal
circumstances the Trustee obtains the Unitholder's taxpayer identification
number from the selling investment executive. However, any time a Unitholder
elects to
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tender Units for redemption, such Unitholder should make sure that the Trustee
has been provided a certified taxpayer identification number in order to avoid
this possible back-up withholding. In the event the Trustee has not been
previously provided such number, one must be provided at the time redemption is
requested.
Any amounts paid on redemption representing unpaid dividends shall be
withdrawn from the Income Account of a Trust to the extent that funds are
available for such purpose, or from the Capital Account. All other amounts paid
on redemption shall be withdrawn from the Capital Account for a Trust. The
Trustee is empowered to sell Securities for a Trust in order to make funds
available for the redemption of Units of such Trust. Such sale may be required
when Securities would not otherwise be sold and might result in lower prices
than might otherwise be realized. To the extent that Securities are sold, the
size of a Trust will, and the diversity of such Trust may, be reduced but each
remaining Unit will continue to represent approximately the same proportionate
interest in each Security. The price received upon redemption may be more or
less than the amount paid by the Unitholder depending on the value of the
Securities in the portfolio at the time of redemption.
The right of redemption may be suspended and payment postponed (1) for any
period during which the Exchange is closed, other than customary weekend and
holiday closings, or during which (as determined by the SEC) trading on the
Exchange is restricted; (2) for any period during which an emergency exists as a
result of which disposal by the Trustee of Securities is not reasonably
practicable or it is not reasonably practicable to fairly determine the value of
the underlying Securities in accordance with the Trust Agreement; or (3) for
such other period as the SEC may by order permit. The Trustee is not liable to
any person in any way for any loss or damage which may result from any such
suspension or postponement.
Computation of Redemption Price. The Redemption Price per Unit (as well as
the secondary market price) will be determined on the basis of the aggregate
underlying bid value of the Securities in a Trust. While the Trustee has the
power to determine the Redemption Price per Unit when Units are tendered for
redemption, such authority will be delegated to the Evaluator which determines
the price per Unit on a daily basis. The Redemption Price per Unit is the pro
rata share of each Unit in a Trust determined on the basis of (i) the cash on
hand in a Trust or monies in the process of being collected and (ii) the value
of the Securities in a Trust less (a) amounts representing taxes or other
governmental charges payable out of the Trust, (b) any amount owing to the
Trustee for its advances and (c) the accrued expenses of such Trust. The
Evaluator may determine the value of the Securities in the Trusts in the
following manner: if the Security is listed on a national securities exchange,
the evaluation will generally be based on the last sales price on the exchange
(unless the Evaluator deems the price inappropriate as a basis for evaluation).
If the Security is not so listed or, if so listed and the principal market for
the Security is other than on the exchange, the evaluation will generally be
made by the Evaluator in good faith based on the last bid price in the
over-the-counter market (unless the Evaluator deems such price inappropriate as
a basis for evaluation) or, if a bid price is not available, (1) on the basis of
the current bid price for comparable securities, (2) by the Evaluator's
appraising
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the value of the Securities in good faith at the bid side of the market or (3)
by any combination thereof. See "Public Offering of Units-Public Offering
Price."
Retirement Plans
The Trusts may be suitable for purchase by IRAs, Self-Employed Individual
Retirement Plans ("Keogh Plan"), pension plans and other qualified retirement
plans, certain of which are briefly described below. Generally, capital gains
and income received under each of the foregoing plans are deferred from Federal
taxation. All distributions from such plans are generally treated as ordinary
income but may, in some cases, be eligible for special income averaging or
tax-deferred rollover treatment. Investors considering participation in any such
plan should review specific tax laws related thereto and should consult their
attorneys or tax advisers with respect to the establishment and maintenance of
any such plan. Such plans are offered by brokerage firms and other financial
institutions. Fees and charges with respect to such plans may vary.
Unitholders
Ownership of Units. Ownership of Units of the Trusts will not be evidenced
by certificates unless a Unitholder, the Unitholder's investment executive or
the clearing agent for such investment executive makes a written request to the
Trustee. Units are transferable by making a written request to the Trustee and,
in the case of Units evidenced by a certificate, by presenting and surrendering
such certificate to the Trustee properly endorsed or accompanied by a written
instrument or instruments of transfer which should be sent by registered or
certified mail for the protection of the Unitholder. Unitholders must sign such
written request, and such certificate or transfer instrument, exactly as their
names appear on the records of the Trustee and on any certificate representing
the Units to be transferred. Such signatures must be guaranteed as stated under
"Redemption -- General."
Units may be purchased and certificates, if requested, will be issued in
denominations of one Unit or any multiple thereof, subject to each Trust's
minimum investment requirement of 50 Units. Fractions of Units, if any, will be
computed to three decimal places. Any certificate issued will be numbered
serially for identification, issued in fully registered form and will be
transferable only on the books of the Trustee. The Trustee may require a
Unitholder to pay a reasonable fee, to be determined at the sole discretion of
the Trustee, for each certificate reissued or transferred and to pay any
governmental charge that may be imposed in connection with each such transfer or
interchange. The Trustee at the present time does not intend to charge for the
normal transfer or interchange of certificates. Destroyed, stolen, mutilated or
lost certificates will be replaced upon delivery to the Trustee of satisfactory
indemnity (generally accounting to 1-1/2% of the market value of the Units),
affidavit of loss, evidence of ownership and payment of expenses incurred.
Distributions to Unitholders. Income received by a Trust is credited by the
Trustee to the Income Account of such Trust. Other receipts are credited to the
Capital Account of a Trust. Income received by a Trust will be distributed on or
shortly after the last day of June
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and December of each year on a pro rata basis to Unitholders of record as of the
preceding record date (which will be the fifteenth day of the related month).
All distributions will be net of applicable expenses. There is no assurance that
any actual distributions will be made since all dividends received may be used
to pay expenses. In addition, amounts from the Capital Account of a Trust, if
any, will be distributed at least annually in December to the Unitholders then
of record. Proceeds received from the disposition of any of the Securities after
a record date and prior to the following distribution date will be held in the
Capital Account and not distributed until the next distribution date applicable
to the Capital Account. The Trustee shall not be required to make a distribution
from the Capital Account unless the cash balance on deposit therein available
for distribution shall be sufficient to distribute at least $1.00 per 50 Units.
The Trustee is not required to pay interest on funds held in the Capital or
Income Accounts (but may itself earn interest thereon and therefore benefit from
the use of such funds). The Trustee is authorized to reinvest any funds held in
the Capital or Income Accounts, pending distribution, in U.S. Treasury
obligations which mature on or before the next applicable distribution date. Any
obligations so acquired must be held until they mature and proceeds therefrom
may not be reinvested.
The distribution to the Unitholders as of each record date will be made on
the following distribution date or shortly thereafter and shall consist of an
amount substantially equal to such portion of the Unitholders' pro rata share of
the dividend distributions then held in the Income Account after deducting
estimated expenses. Because dividends are not received by a Trust at a constant
rate throughout the year, such distributions to Unitholders are expected to
fluctuate. Persons who purchase Units will commence receiving distributions only
after such person becomes a record owner. Notification to the Trustee of the
transfer of Units is the responsibility of the purchaser, but in the normal
course of business such notice is provided by the selling firm.
As of the first day of each month, the Trustee will deduct from the Income
Account of a Trust and, to the extent funds are not sufficient therein, from the
Capital Account of a Trust, the amounts necessary to pay the expenses of such
Trust (as determined on the basis set forth under "Expenses of the Trust"). The
Trustee also may withdraw from said accounts such amounts, if any, as it deems
necessary to establish a reserve for any governmental charges payable out of a
Trust. Amounts so withdrawn shall not be considered a part of a Trust's assets
until such time as the Trustee shall return all or any part of such amounts to
the appropriate accounts. In addition, the Trustee may withdraw from the Income
and Capital Accounts of a Trust such amounts as may be necessary to cover
redemptions of Units.
Statements to Unitholders. With each distribution, the Trustee will
furnish or cause to be furnished to each Unitholder a statement of the amount of
income and the amount of other receipts, if any, which are being distributed,
expressed in each case as a dollar amount per Unit.
The accounts of the Trusts are required to be audited annually, at each
Trust's expense, by independent public auditors designated by such Sponsor,
unless the Sponsor determines that such an audit would not be in the best
interest of the Unitholders of such
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Trust. The report of independent auditors will be furnished by the Trustee to
any Unitholder of a Trust upon written request. Within a reasonable period of
time after the end of each calendar year, the Trustee shall furnish to each
person who at any time during the calendar year was a Unitholder of a Trust a
statement, covering the calendar year, setting forth for such Trust:
A. As to the Income Account:
1. Income received;
2. Deductions for applicable taxes and for fees and expenses
of a Trust and for redemptions of Units, if any;
3. The balance remaining after such distributions and
deductions, expressed in each case both as a total dollar amount and as
a dollar amount representing the pro rata share of each Unit outstanding
on the last business day of such calendar year; and
B. As to the Capital Account:
1. The dates of disposition of any Securities and the net
proceeds received therefrom;
2. Deductions for payment of applicable taxes and fees and
expenses of a Trust held for distribution to Unitholders of record as of
a date prior to the determination;
3. The balance remaining after such distributions and
deductions expressed both as a total dollar amount and as a dollar
amount representing the pro rata share of each Unit outstanding on the
last business day of such calendar year; and
C. The following information:
1. A list of the Securities as of the last business day of such
calendar year;
2. The number of Units outstanding on the last business day of
such calendar year;
3. The Redemption Price based on the last evaluation made
during such calendar year; and
4. The amount actually distributed during such calendar year
from the Income and Capital Accounts separately stated, expressed both
as total dollar amounts and as dollar amounts per Unit outstanding on
the record dates for each such distribution.
Rights of Unitholders. A Unitholder may at any time tender Units to the
Trustee for redemption.
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No Unitholder shall have the right to control the operation and management
of a Trust in any manner, except to vote with respect to the amendment of the
Trust Agreement or termination of such Trust.
Investment Supervision
Each Trust is a unit investment trust and is not an "actively managed"
fund. Traditional methods of investment management for a managed fund typically
involve frequent changes in a portfolio of securities on the basis of economic,
financial and market analyses. The portfolio of the Trusts will not be actively
managed and therefore the adverse financial condition of an issuer will not
necessarily require the sale of its securities from the portfolio. However, the
Sponsor may direct the Trustee to dispose of Securities upon default in payment
of amounts due on debt obligations of the issuer of the Securities or upon 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 such Securities in a Trust
detrimental to the interest of the Unitholders. In addition, the Sponsor will
instruct the Trustee to dispose of certain Securities and to take such further
action as may be needed from time to time to ensure that a Trust continues to
satisfy the qualifications of a regulated investment company, including the
requirements with respect to diversification under Section 851 of the Code.
Pursuant to the Trust Agreement, the Sponsor is not authorized to direct the
reinvestment of the proceeds of the sale of Securities in replacement securities
except in the event the sale is the direct result of serious adverse credit
factors affecting the issuer of the Security which, in the opinion of the
Sponsor, would make the retention of such Security detrimental to a Trust. If
such factors exist, the Sponsor is authorized, but not obligated, to direct the
reinvestment of the proceeds of the sale of such Securities in any other
securities which meet the criteria necessary for inclusion in a Trust on the
Trust's initial Date of Deposit (including other Securities already deposited in
such Trust). The Trustee may sell any securities or other properties acquired in
exchange for Securities such as those acquired in connection with a merger or
other transaction. If offered such new or exchanged securities or property, the
Trustee shall reject the offer. However, in the event such securities or
property are nonetheless acquired by a Trust, they may be accepted for deposit
in such Trust and either sold by the Trustee or held in the Trust pursuant to
the direction of the Sponsor. Proceeds from the sale of Securities (or any
securities or other property received by a Trust in exchange for Securities) are
credited to the Capital Account for distribution to Unitholders or to meet
redemptions. Except as stated under "The Trusts" for failed securities and as
provided in this paragraph, the acquisition by a Trust of any securities other
than the Securities is prohibited.
The Trustee may sell Securities, designated by the Sponsor, from a Trust
for the purpose of redeeming Units of the Trust tendered for redemption and the
payment of expenses.
-17-
<PAGE>
Administration of the Trusts
The Trustee. The Trustee is The Bank of New York, a trust company organized
under the laws of New York. The Bank of New York has its offices at 101 Barclay
Street, New York, New York 10286, (800) 221-7668. The Bank of New York is
subject to supervision and examination by the Superintendent of Banks of the
State of New York and the Board of Governors of the Federal Reserve System, and
its deposits are insured by the FDIC to the extent permitted by law.
The Trustee, whose duties are ministerial in nature, has not participated
in selecting the portfolio of the Trusts. For information relating to the
responsibilities of the Trustee under the Trust Agreement, reference is made to
the material set forth under "Unitholders."
In accordance with the Trust Agreement, the Trustee shall keep records of
all transactions at its office. Such records shall include the name and address
of, and the number of Units held by, every Unitholder of the Trusts. Such books
and records shall be open to inspection by any Unitholder of the Trusts at all
reasonable times during usual business hours. The Trustee shall make such annual
or other reports as may from time to time be required under any applicable state
or federal statute, rule or regulation. The Trustee shall keep a certified copy
or duplicate original of the Trust Agreement on file in its office available for
inspection at all reasonable times during usual business hours by any
Unitholder, together with a current list of the Securities held in the Trusts.
Pursuant to the Trust Agreement, the Trustee may employ one or more agents for
the purpose of custody and safeguarding of Securities comprising the Trusts.
Under the Trust Agreement, the Trustee or any successor trustee may resign
and be discharged of the trust created by the Trust Agreement by executing an
instrument in writing and filing the same with the Sponsor.
The Trustee or successor trustee must mail a copy of the notice of
resignation to all Unitholders then of record, not less than sixty days before
the date specified in such notice when such resignation is to take effect. The
Sponsor upon receiving notice of such resignation is obligated to appoint a
successor trustee promptly. If, upon such resignation, no successor trustee has
been appointed and has accepted the appointment within thirty days after
notification, the retiring Trustee may apply to a court of competent
jurisdiction for the appointment of a successor. The Sponsor may at any time
remove the Trustee, with or without cause, and appoint a successor trustee as
provided in the Trust Agreement. Notice of such removal and appointment shall be
mailed to each Unitholder by the Sponsor. Upon execution of a written acceptance
of such appointment by such successor trustee, all the rights, powers, duties
and obligations of the original Trustee shall vest in the successor. The Trustee
must be a corporation organized under the laws of the United States or any state
thereof, be authorized under such laws to exercise trust powers and have at all
times aggregate capital, surplus and undivided profits of not less than
$5,000,000.
The Sponsor. The Sponsor, Legg Mason Wood Walker, Incorporated, is a wholly
owned subsidiary of Legg Mason, Inc. and is a registered broker-dealer
incorporated under
-18-
<PAGE>
the laws of the State of Maryland. The Sponsor is a member firm of the New York
Stock Exchange and is a member of the National Association of Securities
Dealers, Inc. The Sponsor, through its over 90 offices located in 23 states, and
other subsidiaries of Legg Mason, Inc. offer a full line of investment services
including investment research and trade execution services for listed and
unlisted equity and fixed-income securities and options; exchange floor
execution; investment banking services for corporations and public sector
clients; and professional investment management services for individual and
institutional clients. Among other specialties, the Sponsor and the other
subsidiaries of Legg Mason, Inc., most notably Gray, Seifert & Company, Inc.
(which as of June 30, 1995 had over $700 million assets under management), are
recognized for their concentrated focus on research and securities analysis with
respect to regional thrift institutions and regional and community banks and
bank holding companies. The Sponsor and other subsidiaries of Legg Mason, Inc.
may, but need not, make a principal market as dealer in one or more of the
Securities in the Trusts. For the fiscal year ended March 31, 1996 Legg Mason,
Inc. had revenues of $516,043,000. As of March 31, 1996 the stockholders' equity
of Legg Mason Wood Walker, Incorporated, on an unconsolidated basis, was
$161,012,000 (unaudited). The foregoing information with regard to the Sponsor
relates to the Sponsor only and not to the Trusts. Such information is included
in this Prospectus only for the purpose of informing investors as to the
responsibility of the Sponsor and its ability to carry out its contractual
obligations with respect to the Trusts. More detailed financial information
concerning the Sponsor can be obtained upon request from the Sponsor.
If at any time the Sponsor shall fail to perform any of its duties under
the Trust Agreement or shall become incapable of acting or shall be adjudged
bankrupt or insolvent or shall have its affairs taken over by public
authorities, then the Trustee may (a) appoint a successor sponsor at rates of
compensation deemed by the Trustee to be reasonable and not exceeding such
reasonable amounts as may be prescribed by the SEC, or (b) terminate the Trust
Agreement and liquidate the Trust as provided therein, or (c) continue to act as
Trustee without terminating the Trust Agreement.
The Evaluator. Gray, Seifert & Company, Inc., an affiliate of the Sponsor,
serves as Evaluator. The Evaluator may resign or be removed by the Sponsor in
which event the Sponsor is to use its best efforts to appoint a satisfactory
successor. Such resignation or removal shall become effective upon acceptance of
appointment by the successor evaluator. If upon resignation of the Evaluator no
successor has accepted appointment within thirty days after notice of
resignation, the Evaluator may apply to a court of competent jurisdiction for
the appointment of a successor. Notice of such resignation or removal and
appointment shall be mailed by the Trustee to each Unitholder.
Amendment and Termination. The Trust Agreement may be amended by the
Trustee and the Sponsor without the consent of any of the Unitholders: (1) to
cure any ambiguity or to correct or supplement any provision which may be
defective or inconsistent; (2) to change any provision thereof as may be
required by the SEC or any successor governmental agency; or (3) to make such
provisions as shall not adversely affect the interests of the Unitholders. The
Trust Agreement with respect to a Trust may also be amended in any respect by
the Sponsor and the Trustee, or any of the provisions thereof may be waived,
with the consent
-19-
<PAGE>
of the holders of Units representing 66-2/3% of the Units then outstanding of a
Trust, provided that no such amendment or waiver will reduce the interest of any
Unitholder thereof without the consent of such Unitholder or reduce the
percentage of Units required to consent to any such amendment or waiver without
the consent of all Unitholders of a Trust. In no event shall the Trust Agreement
be amended to increase the number of Units of a Trust issuable thereunder or to
permit the acquisition of any Securities in addition to or in substitution for
those initially deposited in a Trust, except in accordance with the provisions
of the Trust Agreement. The Trustee shall promptly notify Unitholders of the
substance of any such amendment.
The Trust Agreement provides that each Trust shall terminate upon the
liquidation, redemption or other disposition of the last of the Securities held
in such Trust, but in no event is it to continue beyond the Mandatory
Termination Date set forth under "Essential Information" in Part One of this
Prospectus. If the value of a Trust shall be less than the applicable minimum
value stated under "Essential Information" in Part One of this Prospectus, (40%
of the aggregate value of the Securities--based on the value at a Trust's
initial Date of Deposit of such Securities into the Trust), the Trustee may, in
its discretion, and shall, when so directed by the Sponsor, terminate such
Trust. Each Trust may be terminated at any time by Unitholders representing,
66-2/3% of the Units thereof then outstanding.
No later than the date specified under "Liquidation Period" set forth under
"Essential Information" in Part One of this Prospectus, the Trustee will begin
to sell all of the underlying Securities on behalf of Unitholders in connection
with the termination of the Trusts. The Sponsor has agreed to assist the Trustee
in these sales. The sale proceeds will be net of any incidental expenses
involved in the sales. At termination of each Trust, written notice thereof will
be sent by the Trustee to all Unitholders of the respective Trust. Within a
reasonable period after termination, the Trustee will sell any Securities
remaining in such Trust and, after paying all expenses and charges incurred by
the Trust, will distribute to Unitholders thereof their pro rata share of the
balances remaining in the Income and Capital Accounts of the Trust.
Limitations on Liability. The Sponsor: The Sponsor is liable for the
performance of its obligations arising from its responsibilities under the Trust
Agreement, but will be under no liability to the Unitholders for taking any
action or refraining from any action in good faith pursuant to the Trust
Agreement or for errors in judgment, except in cases of its own gross
negligence, bad faith or willful misconduct or its reckless disregard for its
duties thereunder. The Sponsor shall not be liable or responsible in any way for
depreciation or loss incurred by reason of the sale of any Securities.
The Trustee: The Trust Agreement provides that the Trustee shall be under
no liability for any action taken in good faith in reliance upon prima facie
properly executed documents or for the disposition of monies, Securities or
certificates except by reason of its own gross negligence, bad faith or willful
misconduct, or its reckless disregard for its duties under the Trust Agreement,
nor shall the Trustee be liable or responsible in any way for depreciation or
loss incurred by reason of the sale by the Trustee of any Securities. In the
-20-
<PAGE>
event that the Sponsor shall fail to act, the Trustee may act and shall not be
liable for any such action taken by it in good faith. The Trustee shall not be
personally liable for any taxes or other governmental charges imposed upon or in
respect of the Securities or upon the interest thereof. In addition, the Trust
Agreement contains other customary provisions limiting the liability of the
Trustee.
The Evaluator: The Trustee, Sponsor and Unitholders may rely on any
evaluation furnished by the Evaluator and shall have no responsibility for the
accuracy thereof. The Trust Agreement provides that the determinations made by
the Evaluator shall be made in good faith upon the basis of the best information
available to it. The Evaluator shall be under no liability to the Trustee or
Unitholders for errors in judgment, but shall be liable only for its gross
negligence, bad faith or willful misconduct or its reckless disregard for its
obligations under the Trust Agreement.
Expenses of The Trusts
The Sponsor will not charge a Trust any fees for services performed as
Sponsor but will receive that fee set forth under "Essential Information" in
Part One of this Prospectus, for providing supervisory services. Such fee, which
is calculated monthly, is based on the largest number of Units outstanding
during the calendar year for which such compensation relates. The Sponsor will
also receive a portion of the sale commissions paid in connection with the
purchase of Units.
The Trustee receives for its services that fee set forth under "Essential
Information" in Part One of this Prospectus. The Trustee's fee which is
calculated monthly is based on the largest number of Units outstanding during
the calendar year for which such compensation relates. The Trustee's fees are
payable monthly on or before the fifteenth day of the month from the Income
Account to the extent funds are available and then from the Capital Account. The
Trustee benefits to the extent there are funds for future distributions, payment
of expenses and redemptions in the Capital and Income Accounts since these
Accounts are non-interest bearing, and the amounts earned by the Trustee are
retained by the Trustee. Part of the Trustee's compensation for its services to
the Trust is expected to result from the use of these funds.
For evaluation of Securities in a Trust, the Evaluator shall receive that
fee set forth under "Essential Information" in Part One of this Prospectus,
payable monthly, based upon the largest number of Units outstanding during the
calendar year for which such compensation relates.
The Trustee's fees, the Sponsor's supervisory fees and the Evaluator's fees
are deducted from the Income Account of a Trust to the extent funds are
available, and then from the Capital Account. Each such fee may be increased
without approval of Unitholders by amounts not exceeding a proportionate
increase in the Consumer Price Index or any equivalent index substituted
therefor.
-21-
<PAGE>
Expenses incurred in establishing the Trusts, including the cost of the
initial preparation of documents relating to the Trusts (including the
Prospectus, Trust Agreement and certificates), federal and state registration
fees, the initial fees and expenses of the Trustee, legal and accounting
expenses, payment of closing fees and any other out-of-pocket expenses, will be
paid by the Trusts and amortized over the life of the Trusts. The following
additional charges are or may be incurred by a Trust: (a) fees for the Trustee's
extraordinary services; (b) expenses of the Trustee (including legal and
auditing expenses, but not including any fees and expenses charged by an agent
for custody and safeguarding of Securities) and of counsel, if any; (c) various
governmental charges; (d) expenses and costs of any action taken by the Trustee
to protect the Trusts or the rights and interests of the Unitholders; (e)
indemnification of the Trustee for any loss, liability or expense incurred by it
in the administration of the Trusts not resulting from gross negligence, bad
faith or willful misconduct on its part or its reckless disregard for its
obligations under the Trust Agreement; (f) indemnification of the Sponsor for
any loss, liability or expense incurred in acting in that capacity without gross
negligence, bad faith or willful misconduct or its reckless disregard for its
obligations under the Trust Agreement; and (g) expenditures incurred in
contacting Unitholders upon termination of the Trusts. The fees and expenses set
forth herein are payable out of the Trusts and, when owing to the Trustee, are
secured by a lien on the Trusts. Since the Securities are all common stocks, and
the income stream produced by dividend payments, if any, is unpredictable, the
Sponsor cannot provide any assurance that dividends will be sufficient to meet
any or all expenses of the Trusts. If the balances in the Income and Capital
Accounts are insufficient to provide for amounts payable by the Trust, the
Trustee has the power to sell Securities to pay such amounts. These sales may
result in capital gains or losses to Unitholders. See "Federal Tax Status."
Legal Opinions
The legality of the Units offered hereby and certain matters relating to
federal tax law have been passed upon by Chapman and Cutler, 111 West Monroe
Street, Chicago, Illinois 60603, as counsel for the Sponsor.
Independent Auditors
The financial statements of each Trust appearing in Part One of their
respective Prospectus and Registration Statement have been audited by Ernst &
Young LLP,independent auditors, as set forth in their report thereon appearing
elsewhere herein and in the Registration Statement, and are included herein in
reliance upon such report given the authority of such firm as experts
in accounting and auditing.
-22-
<PAGE>
Contents
PAGE
SUMMARY 2
THE TRUSTS 4
THE TRUST PORTFOLIO 4
RISK FACTORS 5
FEDERAL TAX STATUS 8
PUBLIC OFFERING OF UNITS 10
Public Offering Price 10
Public Distribution of Units 11
Sponsor Profits 11
MARKET FOR UNITS 11
General 12
Computation of Redemption Price 13
Statements to Unitholders 15
Rights of Unitholders 16
INVESTMENT SUPERVISION 17
ADMINISTRATION OF THE TRUSTS 18
The Sponsor 18
The Evaluator 19
Amendment and Termination 19
Limitations on Liability 20
EXPENSES OF THE TRUSTS 21
LEGAL OPINIONS 22
INDEPENDENT AUDITORS 22
This Prospectus does not contain information with respect to the investment
company set forth in its registration statement 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 of Act of 1940,
and to which reference is hereby made.
--------------
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 representation not contained herein must not be relied upon
as having been authorized by the Trust, the Trustee, or the Sponsor. Such
registration does not imply that the Trust or the Units have been guaranteed,
sponsored, recommended or approved by the United States or any state or any
agency or officer thereof.
This Prospectus does not constitute an offer to sell, or a solicitation of an
offer to buy, securities in any state to any person to whom it is not lawful to
make such offer in such state or county.
LEGG MASON
UNIT INVESTMENT TRUST SERIES
Prospectus
Part Two
APRIL 30, 1996
LEGG MASON
REGIONAL BANK AND THRIFT TRUST
SERIES
LEGG MASON WOOD WALKER, INCORPORATED
111 SOUTH CALVERT STREET
P.O. BOX 1476
BALTIMORE, MARYLAND 21203-1476
(410) 539-0000/(800) 822-5544
<PAGE>
Contents of Post-Effective Amendment
to Registration Statement
This Post-Effective Amendment to the Registration Statement comprises the
following papers and documents:
The facing sheet
The prospectus
The signatures
The Consent of Independent Auditors
S-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant, Legg Mason Unit Investment Trust, Series 5, 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 Post-Effective Amendment to its Registration Statement to be signed on its
behalf by the undersigned thereunto duly authorized, and its seal to be hereunto
affixed and attested, all in the City of Baltimore and State of Maryland on the
29th day of April, 1996.
Legg Mason Unit Investment Trust, Series 5
(Registrant)
By Legg Mason Wood Walker, Incorporated
(Depositor)
By /s/Kathi D. Glenn
(Seal)
Pursuant to the requirements of the Securities Act of 1933, this Post
Effective Amendment to the Registration Statement has been signed below by the
following persons in the capacities on April 29, 1996:
Signature Title
Raymond A. Mason Chairman of the Board
John F. Curley, Jr. Vice Chairman of the Board
James W. Brinkley President and Director
Edmund J. Cashman, Jr. Senior Executive Vice President
and Director
Robert G. Sabelhaus Executive Vice President
and Director
Richard J. Himelfarb Executive Vice President
and Director
Edward A. Taber III Executive Vice President
S-3
<PAGE>
and Director
Charles A. Bacigalupo Senior Vice President
and Director
Thomas M. Daly, Jr. Senior Vice President
and Director
Jerome M. Dattel Senior Vice President
and Director
Robert G. Donovan Senior Vice President
and Director
William F. Haneman, Jr. Senior Vice President
and Director
Thomas E. Hill Senior Vice President
and Director
Arnold S. Hoffman Senior Vice President
and Director
Carl Hohnbaum Senior Vice President
and Director
William B. Jones, Jr. Senior Vice President
and Director
Laura L. Lange Senior Vice President
and Director
Marvin H. McIntyre Senior Vice President
and Director
Douglas C. Petty, Jr. Senior Vice President
and Director
Mark I. Preston Senior Vice President
and Director
M. Walter D'Alessio Director
F. Barry Bilson Senior Vice President
and Director
S-4
<PAGE>
/s/ Kathi D. Glenn
(Attorney-in-fact)*
- -------------------------------
*An executed copy of the related powers of attorney were filed as Exhibit 7.1 to
the initial Registration Statement for Legg Mason Unit Investment Trust, Series
5 as filed on March 24, 1995 and Amendment No. 1 to the Registration Statement
for Legg Mason Unit Investment Trust, Series 5 as filed on May 22, 1995 (file
no. 33-90620).
S-5
<PAGE>
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Independent Auditors"
and to the use of our report dated February 27, 1996 in this Post-Effective
Amendment No. 1 to Registration Statement (Form S-6 No. 33-90620) and related
Prospectus of Legg Mason Unit Investment Trust, Series 5.
/s/ Ernst & Young LLP
Baltimore, Maryland
April 24, 1996
S-6
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000943057
<NAME> LEGG MASON UNIT INVESTMENT TRUST, SERIES 5
<SERIES>
<NUMBER> 1
<NAME> LEGG MASON REGIONAL BANK AND THRIFT TRUST
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> OTHER
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> MAY-23-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 41,163,575
<INVESTMENTS-AT-VALUE> 53,441,157
<RECEIVABLES> 102,599
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> (46,964)
<TOTAL-ASSETS> 53,496,792
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 67,841
<TOTAL-LIABILITIES> 67,841
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 41,151,369
<SHARES-COMMON-STOCK> 2,136,148
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 12,277,582
<NET-ASSETS> 53,428,951
<DIVIDEND-INCOME> 854,894
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 48,720
<NET-INVESTMENT-INCOME> 806,174
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 12,277,582
<NET-CHANGE-FROM-OPS> 13,083,756
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (806,174)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> (12,206)
<NUMBER-OF-SHARES-SOLD> 2,136,148
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 12,265,376
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 48,720
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 19.27
<PER-SHARE-NII> .38
<PER-SHARE-GAIN-APPREC> 5.75
<PER-SHARE-DIVIDEND> (.38)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> (.01)
<PER-SHARE-NAV-END> 25.01
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
