As filed with the Securities and Exchange Commission on July 3, 2002
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________________________
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
________________________________
LEGG MASON, INC.
(Exact name of registrant as specified in its charter)
Maryland 52-1200960
(State or other jurisdiction of (I.R.S. employer identification no.)
incorporation or organization)
100 Light Street
Baltimore, Maryland 21202
(410) 539-0000
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
Robert F. Price
Senior Vice President, Secretary and General Counsel
Legg Mason, Inc.
100 Light Street
Baltimore, Maryland 21202
(410) 539-0000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Approximate date of commencement of proposed sale to the public: From
time to time after the effective date of this registration statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, check the following box.[]
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box.[x]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
============================================================================================================================
Proposed Maximum Proposed Maximum
Title of Each Class of Securities Amount to be Offering Price Per Aggregate Offering Amount of
to be Registered Registered Unit(1) Price(1) Registration Fee
----------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------
Common Stock, par value $.10 per share 59,943 shares $47.675 $2,857,783 $263
----------------------------------------------------------------------------------------------------------------------------
(1) Calculated in accordance with Rule 457(c) under the Securities Act of 1933
based on the average of the high and low prices of the common stock
reported in the consolidated system on June 26, 2002.
The registrant hereby amends this registration statement on such date
or dates as may be necessary to delay its effective date until the
registrant shall file a further amendment which specifically states that
this registration statement shall thereafter become effective in accordance
with section 8(a) of the Securities Act of 1933 or until the registration
statement shall become effective on such date as the commission, acting
pursuant to said section 8(a), may determine.
SUBJECT TO COMPLETION, DATED JULY 3, 2002
59,943 SHARES
LEGG MASON, INC.
COMMON STOCK
The selling stockholders may offer from time to time an aggregate
of up to 59,943 shares of our common stock. We will not receive any
proceeds from the sale of the common stock covered by this prospectus.
The selling stockholders may offer their shares through public or
private transactions, on or off the New York Stock Exchange, at prevailing
market prices or at privately negotiated prices.
Our common stock trades on the New York Stock Exchange under the
symbol "LM". On June 28, 2002, the closing price of Legg Mason, Inc. common
stock as reported on the New York Stock Exchange was $49.34 per share.
______________________
Neither the Securities and Exchange Commission nor any other
regulatory body has approved or disapproved of these securities or passed
upon the accuracy or adequacy of this prospectus. Any representation to the
contrary is a criminal offense.
______________________
The information in this prospectus is not complete and may be changed. The
selling stockholders may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and is not soliciting an
offer to buy these securities in any state where the offer or sale is not
permitted.
The date of this Prospectus is July __, 2002
TABLE OF CONTENTS
Page
FORWARD-LOOKING INFORMATION.......................................... 2
WHERE YOU CAN FIND MORE INFORMATION................................. 4
THE COMPANY......................................................... 5
MARKET PRICES AND DIVIDEND POLICY................................... 6
USE OF PROCEEDS..................................................... 7
SELLING STOCKHOLDERS................................................ 7
DESCRIPTION OF CAPITAL STOCK........................................ 8
ERISA MATTERS....................................................... 11
PLAN OF DISTRIBUTION................................................ 12
LEGAL MATTERS....................................................... 13
INDEPENDENT ACCOUNTANTS............................................. 13
In this prospectus, we use the term "Legg Mason" to refer to Legg
Mason, Inc. The term "we," "us," and "our" refer to Legg Mason and its
predecessors and subsidiaries. The term "Wallington" refers to Wallington Asset
Management, Inc. The term "Acquisition Agreement" refers to the Agreement and
Plan of Reorganization and Liquidation dated as of November 28, 2001 by and
among Legg Mason, Bartlett & Co., Wallington and Wallington's sole shareholder.
You should rely only on the information contained in or incorporated by
reference in this prospectus. Neither we nor the selling stockholders have
authorized anyone to provide you with different information. If anyone provides
you with different information, you should not rely on it. You should not assume
that the information contained in or incorporated by reference in this
prospectus is accurate as of any date other than the date on the front of this
prospectus. Our business, financial condition, results of operations and
prospects may have changed since then. The selling stockholders are not making
an offer of these securities in any state where the offer is not permitted.
FORWARD-LOOKING INFORMATION
Some of the statements in the prospectus and any documents incorporated
by reference constitute forward-looking statements. These statements relate to
future events or our future financial performance and involve known and unknown
risks, uncertainties and other factors that may cause our actual results to be
materially different from those expressed or implied by any forward-looking
statements. These forward-looking statements may contain information related,
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but not limited to:
o Anticipated growth in revenues or earnings per share;
o Anticipated changes in our business or in the amount of client assets
under management;
o Anticipated expense levels and expectations regarding financial market
conditions; and
o Anticipated performance of recent, pending and future acquisitions.
In some cases, you can identify forward-looking statements by
terminology such as "may," "will," "could," "would," "should," "expect," "plan,"
"anticipate," "intend," "believe," "estimate," "predict," "potential" or
"continue" or the negative of those terms or other comparable terminology.
Theses statements are only predictions. Actual events or results may differ
materially due to a number of factors including:
o the volatile and competitive nature of the financial services industry;
o changes in domestic and foreign economic and market conditions;
o the loss of key employees or principals of our current or future
operating subsidiaries;
o the effect of current and future federal, state and foreign
regulation of the financial services industry, including potential
liability under applicable securities laws;
o market, credit and liquidity risks associated with our investment
management, underwriting, securities trading and market-making
activities;
o the impairment of acquired intangible assets and goodwill;
o potential restrictions on the business of, and withdrawal of capital
from, certain of our subsidiaries due to net capital requirements;
and
o the effect of any acquisitions.
Moreover, we do not nor does any other person, assume responsibility
for the accuracy and completeness of those statements. We have no duty to update
any of the forward-looking statements after the date of this prospectus. In
assessing these forward-looking statements you should carefully consider the
factors discussed under the captions "Business--Factors Affecting the Company
and the Financial Services Industry" and "Management's Discussion and Analysis
of Results of Operations and Financial Condition" in our most recent Annual
Report on Form 10-K, which describe risks and factors that could cause results
to differ materially from those projected in such forward-looking statements.
We caution the reader that these risk factors may not be exhaustive. We
operate in a continually changing business environment, and new risks emerge
from time to time. Management cannot predict such new risks or the impact of
such new risks on our businesses. Accordingly, forward-looking statements should
not be relied upon as a prediction of actual results.
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WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the Securities and Exchange Commission. You may read and
copy any document we file at the SEC's public reference rooms at 450 Fifth
Street, N.W., Washington, D.C. 20549 and in New York, New York and Chicago,
Illinois. Please call the SEC at 1-800-SEC-0330 for further information on the
public reference rooms. Our SEC filings are also available to the public from
the SEC's web site at http://www.sec.gov. Our common stock is listed on the New
York Stock Exchange under the Symbol "LM". Information about us also is
available at the exchange.
This prospectus is part of a registration statement we filed with the
SEC. This prospectus omits some information contained in the registration
statement in accordance with SEC rules and regulations. You should review the
information and exhibits in the registration statement for further information
about us and our consolidated subsidiaries and the securities we are offering.
Statements in this prospectus concerning any document we filed as an exhibit to
the registration statement or that we otherwise filed with the SEC are not
intended to be comprehensive and are qualified by reference to these filings.
You should review the complete document to evaluate these statements.
The SEC allows us to incorporate by reference much of the information
we file with them. This means that we can disclose important information to you
by referring you to those documents that are considered part of this prospectus.
The information that we incorporate by reference in this prospectus is
considered to be part of this prospectus. Because we are incorporating by
reference future filings with the SEC, this prospectus is continually updated
and those future filings may modify or supersede some of the information
included or incorporated in this prospectus. This means that you must look at
all of the SEC filings that we incorporate by reference to determine if any of
the statements in this prospectus or in any document previously incorporated by
reference have been modified or superseded. We incorporate by reference the
documents listed below and any future filings we make with the SEC under Section
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until the date
on which the selling stockholders cease offering and selling these securities:
o Annual Report on Form 10-K for the year ended March 31, 2002; and
o The description of our common stock, par value $.10 per share,
contained in Amendment No. 5 to our Application for Registration on
Form 8-A, filed February 23, 2001.
You may obtain a copy of these filings at no cost, by writing or
telephoning us at the following:
Legg Mason, Inc.
100 Light Street
Baltimore, Maryland 21202
Attn: Corporate Secretary
(410) 539-0000
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THE COMPANY
We are a holding company that, through our subsidiaries, is principally
engaged in providing the following services to individuals, institutions,
corporations, governments and government agencies:
o asset management;
o securities brokerage;
o investment banking; and
o other related financial services.
We currently operate through four business segments: Asset Management, Private
Client, Capital Markets and Other.
In our Asset Management business segment, we provide investment
advisory services to company-sponsored investment funds and asset management
services to institutional and individual investors. As of March 31, 2002, our
subsidiaries had an aggregate of $177.0 billion of assets under management. We
divide our asset management business into three groups: Mutual Funds,
Institutional and Wealth Management.
In our Mutual Funds business, we sponsor domestic and international
equity, fixed income and money market mutual and closed-end funds and other
proprietary funds. We have two asset management subsidiaries that primarily
focus on managing proprietary investment funds:
o Legg Mason Funds Management, Inc., which is located in Baltimore,
Maryland; and
o Royce & Associates, LLC, which is located in New York, New York.
Our Institutional asset management subsidiaries provide a wide range of
asset management services and products to domestic and international
institutional clients. Our Institutional asset management subsidiaries are:
o Western Asset Management Company and Western Asset Management
Company Limited, which are primarily located in Pasadena, California
and London, England;
o Perigee Investment Counsel Inc., which is primarily located in Toronto,
Canada;
o Brandywine Asset Management, LLC, which is located in Wilmington,
Delaware;
o Batterymarch Financial Management, Inc., which is primarily located in
Boston, Massachusetts;
o Legg Mason Capital Management, Inc., which is located in Baltimore,
Maryland; and
o Legg Mason Investors Holdings plc, which is located in London, England.
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Our Wealth Management subsidiaries provide customized, discretionary
investment management services and products to high net worth individuals and
families, endowments and foundations and institutions. Our Wealth Management
subsidiaries are:
o Private Capital Management, L.P., which is located in Naples, Florida;
o Bartlett & Co., which is primarily located in Cincinnati, Ohio;
o Barrett Associates, Inc., which is located in New York, New York;
o Gray, Seifert & Co., Inc., which is located in New York, New York;
o Berkshire Asset Management, Inc., which is located in Wilkes-Barre,
Pennsylvania;
o Legg Mason Focus Capital, Inc., which is primarily located in Bala
Cynwyd, Pennsylvania; and
o Legg Mason Trust, fsb, which is located in Baltimore, Maryland.
Our Private Client and Capital Markets business segments are primarily
conducted through Legg Mason Wood Walker, Incorporated ("Legg Mason Wood
Walker"), our principal broker-dealer subsidiary. Legg Mason Wood Walker is a
full service broker-dealer, investment adviser and investment banking firm
operating primarily in the Eastern and Southern regions of the United States.
Our Other business segment consists primarily of the operations of Legg
Mason Real Estate Services, Inc., our principal real estate finance subsidiary.
Legg Mason Real Estate Services is primarily engaged in commercial mortgage
banking and servicing and discretionary and non-discretionary management of
commercial real estate-related assets.
We were incorporated in Maryland in 1981 to serve as a holding company
for Legg Mason Wood Walker, Incorporated and our other subsidiaries. The
predecessor company to Legg Mason Wood Walker, Incorporated was formed in 1970
under the name Legg Mason & Co. Inc., to combine the operations of Legg & Co., a
Maryland-based broker-dealer formed in 1899, and Mason & Company, Inc., a
Virginia-based broker-dealer formed in 1962. Our subsequent growth has occurred
through internal expansion as well as through our acquisition of asset
management, broker-dealer and commercial mortgage banking firms. Our principal
offices are located at 100 Light Street, Baltimore, Maryland 21202. Our
telephone number is (410) 539-0000.
MARKET PRICES AND DIVIDEND POLICY
Our common stock trades on the New York Stock Exchange under the symbol
"LM." There were approximately 2,631 registered holders of our common stock as
of June 17, 2002. The table below sets forth the high and low sales prices of
our common stock as reported for New York Stock Exchange Composite Transactions
and the quarterly cash dividends declared per share of our common stock during
the periods indicated.
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CASH
PRICE RANGE DIVIDENDS
LOW HIGH DECLARED
1999
Quarter Ended:
March 31, 1999..................................... $26.44 $35.88 $ .065
June 30, 1999...................................... $31.06 $42.88 $ .065
September 30, 1999................................. $32.56 $40.94 $ .08
December 31, 1999.................................. $30.63 $41.75 $ .08
2000
Quarter Ended:
March 31, 2000..................................... $30.69 $51.25 $ .08
June 30, 2000...................................... $35.13 $52.38 $ .08
September 30, 2000................................. $47.63 $60.25 $ .09
December 31, 2000.................................. $42.88 $59.63 $ .09
2001
Quarter Ended:
March 31, 2001 .................................... $40.15 $56.99 $ .09
June 30, 2001...................................... $38.06 $51.50 $ .09
September 30, 2000................................. $34.25 $50.93 $ .10
December 31, 2000 $38.35 $50.80 $ .10
2002
Quarter Ended:
March 31, 2002 .................................... $48.36 $57.10 $ .10
June 30, 2002...................................... $46.65 $57.15 $ .10
1 Excludes dividends declared by Perigee Inc. prior to its being
acquired in May 2000.
See the cover page for the closing price for our common stock on the
New York Stock Exchange on June 28, 2002.
Our board of directors currently intends to continue to pay regular
quarterly cash dividends; however, the declaration and payment of future
dividends will be determined by our board of directors in its sole discretion.
Our board's decision will depend upon our earnings, financial condition and
capital needs and other factors that the board of directors deems relevant.
USE OF PROCEEDS
All of the proceeds from the sale of common stock covered by this
prospectus will go to the selling stockholders. We will not receive any proceeds
from the sale of our common stock.
SELLING STOCKHOLDERS
Under the Acquisition Agreement, we have issued 59,943 shares of our
common stock to the shareholder of Wallington. We have agreed to prepare and
file a registration statement to register the resale of these shares of common
stock by the shareholder of Wallington to the public. We have agreed to use
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commercially reasonable efforts to have the registration statement declared
effective and to keep the registration statement effective until the earlier of
the first anniversary of the closing of the Wallington acquisition or the date
that the selling stockholder hereunder has sold all of the common stock.
This prospectus covers the offer and sale by each selling stockholder
of Legg Mason of the number of shares of Legg Mason common stock owned by the
selling stockholder set forth below. The following table sets forth (i) the
names of each selling stockholder, (ii) the nature of any position, office or
other material relationship that the selling stockholder has had with us within
the past three years, (iii) the number of shares of common stock and (if one
percent or more) the percentage of common stock beneficially owned as of June
28, 2002 by each selling stockholder, (iv) the number of shares of common stock
that may be offered or sold by or on behalf of each selling stockholder
hereunder and (v) the amount and (if one percent or more) the percentage of
shares of common stock to be owned by each selling shareholder upon the
completion of the offering assuming all shares offered by such selling
stockholder are sold. Any or all of the shares listed below under the heading
"Shares to be Sold" may be offered for sale by or on behalf of the selling
stockholder.
Shares Beneficially Owned Shares Beneficially
Owned Prior to Shares to Owned After
Selling Stockholders the Offering be Sold the Offering
Number Percent Number Percent
Terence P. Weiss* 59,943 ** 59,943 0 0
___________________
*Employee of our subsidiary Bartlett & Co.
**Less than 1%
We prepared this table based on the information supplied to us as of
July 3, 2002, by the selling stockholder named in the table. The selling
stockholder listed in the above table may have sold or transferred, in
transactions exempt from the registration requirements of the Securities Act,
some or all of his shares of common stock since the date on which the
information is presented in the above table. Information about the selling
stockholders may change over time. Any changed information supplied to us will
be set forth in future prospectus supplements.
DESCRIPTION OF CAPITAL STOCK
Our authorized capital stock consists of 250,000,000 shares of common
stock, par value $.10 per share, and 4,000,000 shares of preferred stock, par
value $10.00 per share. As of June 28, 2002, we had 64,823,714 shares of common
stock and one share of preferred stock outstanding.
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Common Stock
Holders of our common stock are entitled to:
o one vote per share on matters to be voted upon by the stockholders;
o receive dividends out of funds legally available for distribution
when and if declared by our board of directors; and
o share ratably in our assets legally available for
distribution to our stockholders in the event of our
liquidation, dissolution or winding up, after provisions
for distributions to the holders of any preferred stock.
We may not pay any dividend (other than in shares of our common stock)
or make any distributions of assets on shares of our common stock until
cumulative dividends on any preferred stock then outstanding have been paid.
Holders of our common stock have no preemptive, subscription,
redemption or conversion rights. The outstanding shares of our common stock are
fully paid and nonassessable.
The holders of our common stock do not have cumulative voting rights.
This means that holders of more than half of the shares can elect all of the
directors and holders of the remaining shares will not be able to elect any
directors. Our by-laws provide for a classified board of directors consisting of
three classes with staggered three-year terms.
Transfer Agent
The transfer agent and registrar for our common stock is First Union
National Bank, Charlotte, North Carolina.
Preferred Stock
Our Articles of Incorporation authorize our board of directors to issue
shares of preferred stock, par value $10.00 per share, and to fix the terms
(including voting rights, dividends, redemption and conversion provisions, if
any, and rights upon liquidation) of any shares issued. Outstanding shares of
preferred stock that are redeemed or are converted to common stock are restored
to the status of authorized and unissued shares of preferred stock issuable in
series by our board of directors.
On May 26, 2000, we issued one special voting share of preferred stock
in connection with our acquisition of Perigee Inc. This special voting share
provides the holders of exchangeable shares of our subsidiary, Legg Mason Canada
Holdings Ltd. with substantially the same voting rights as the holders of our
common stock. The special voting share has a number of votes, which may be cast
at a Legg Mason stockholders' meeting, equal to the number of exchangeable
shares outstanding. As of June 28, 2002, there were 2,419,894 exchangeable
shares outstanding.
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Our board of directors has the authority, under our Articles of
Incorporation, to classify or reclassify any unissued preferred stock from time
to time by setting or changing the preferences, conversion or other rights,
voting powers, restrictions, limitations as to dividends, qualifications, or
terms or conditions of redemption of the stock.
Two-Tier Business Combination Provisions
Maryland law requires the affirmative vote of at least a majority of
all of the outstanding shares entitled to vote to approve a merger,
consolidation, share exchange or disposition of all or substantially all of our
assets. Our Articles of Incorporation require the affirmative vote of not less
than 70% of our then outstanding voting shares to approve any "business
combination" of us with any "Related Person" unless certain conditions have been
met. In addition, the 70% vote must include the affirmative vote of at least 55%
of the outstanding shares of voting stock held by stockholders other than the
Related Person. Accordingly, the actual vote required to approve the business
combination may be greater than the 70%, depending upon the number of shares
controlled by the Related Person. A Related Person is defined to include any
person or entity which is, directly or indirectly, the beneficial owner of 15%
or more of the outstanding shares of our voting stock, including any affiliate
or associate of such person or entity. The term "business combination" is
defined to include a wide variety of transactions between us and a Related
Person, including a merger, consolidation, share exchange or sale of assets
having a fair market value greater than 10% of the book value of our
consolidated assets.
However, if the Related Person pays a "fair price" to our stockholders
in the transaction, the 70% requirement would not be applicable and the proposed
business combination could be approved by a simple majority of the stockholders
unless otherwise required by Maryland law, provided that such affirmative vote
includes at least 55% of the voting stock held by persons other than the Related
Person. Under our Articles of Incorporation, the "fair price" must be at least
equal to the greater of:
o the highest price paid or agreed to be paid by the Related Person
to purchase shares of our common stock during the 24-month period
prior to the taking of such vote; or
o the highest market price of the common stock during the 24-month
period prior to the taking of such vote; or
o the per share book value of our common stock at the end of the calendar
quarter immediately preceding the taking of such vote.
In addition, the "fair price" consideration to be received by our
stockholders must be of the same form and kind as the most favorable form and
kind of consideration paid by the Related Person in acquiring any of its shares
of our common stock.
The special voting provisions are not applicable to a business
combination authorized by our board of directors by a vote which includes a
majority of our "Disinterested Directors." A Disinterested Director is defined
to include any member of our board of directors who is not the Related Person
(or an affiliate or associate of the Related Person) and who was a director
prior to the time that the Related Person became a Related Person, and any
10
successor of a Disinterested Director who is not the Related Person (or an
affiliate or associate of the Related Person) and who is recommended to succeed
a Disinterested Director by a majority of the Disinterested Directors then on
our board of directors.
Our special voting provisions may not be amended, altered, changed or
repealed except by the affirmative vote of at least 70% of the shares of stock
entitled to vote at a meeting of the stockholders called for the consideration
of such amendment, alteration, change or repeal, and at least 55% of the
outstanding shares of stock entitled to vote thereon held by stockholders who
are not Related Persons, unless such proposal was proposed by our board of
directors by a vote that includes a majority of the Disinterested Directors.
The business combination provisions under our Articles of Incorporation
could have the effect of delaying, deterring or preventing a change in control.
Any possible change in control could also be affected by the applicability of
certain Maryland anti-takeover statutes dealing with business combinations and
acquisitions of controlling blocks of shares, as well as by our classified board
of director provisions.
ERISA MATTERS
The Employee Retirement Income Security Act of 1974, as amended
("ERISA"), and the Internal Revenue Code of 1986, as amended (the "Code"),
impose certain restrictions on
o "employee benefit plans" (as defined in Section 3(3) of ERISA),
o "plans" described in Section 4975(e)(1) of the Code, including
individual retirement accounts or Keogh plans,
o entities whose underlying assets include plan assets by reason of a
plan's investment in such entities (each of (a), (b) and (c) a
"Plan"), and
o persons who have certain specified relationships to Plans
("parties in interest" under ERISA and "disqualified persons" under
the Code).
In addition to the foregoing exemptions, certain insurance company
general accounts, which support policies issued by an insurer on or after
December 31, 1998 to or for the benefit of Plans, are allowed to purchase common
stock in reliance upon regulations promulgated by the Department of Labor
pursuant to Section 1460 of the Small Business Job Protection Act of 1996. If
such policies satisfy the Section 1460 regulations, then the insurer will be
deemed in compliance with ERISA's fiduciary requirements and prohibited
transaction rules with respect to those assets of the insurer's general account
which supports such policies.
ERISA also imposes certain duties on persons who are fiduciaries of
Plans subject to ERISA, and both ERISA and the Code prohibit certain
transactions between a Plan and parties in interest or disqualified persons.
Because of our activities or the activities of our affiliates, we may
be deemed to be a party in interest or disqualified person with respect to a
number of Plans (e.g., those to which we provide brokerage, investment or other
financial services). If our common stock is acquired and held by a Plan with
respect to which we are a party in interest or disqualified person, such
11
acquisition and holding could be deemed to be a direct or indirect prohibited
transaction, which could result in the imposition of taxes or penalties on the
parties to the prohibited transaction.
Such transactions may, however, be exempt from the otherwise applicable
taxes and penalties by reason of one or more statutory or administrative
exemptions such as those described below. Such administrative exemptions may
include:
o Prohibited Transaction Class Exemption ("PTE") 95-60, 60 FR 35925,
July 12, 1995, which exempts certain transactions involving
insurance company general accounts;
o PTE 90-1, 55 FR 2891, January 29, 1990, which exempts certain
transactions involving insurance company pooled separate accounts;
o PTE 91-38, 56 FR 31966, June 12, 1991, which exempts certain
transactions involving bank collective investment funds; and
o PTE 84-14, 49 FR 9494, March 13, 1984, which exempts certain
transactions entered into on behalf of a Plan by a qualified
professional asset manager.
If the conditions of one or more of these exemptions (or some other
applicable exemption) are met, the acquisition and holding of our common stock
by or on behalf of a Plan should be exempt from certain of the prohibited
transaction provisions of ERISA and the Code. It should be noted, however, that
even if such conditions are met, the scope of relief provided by such exemptions
may not necessarily cover all acts that might be construed as prohibited
transactions under ERISA and the Code.
Further, each Plan fiduciary should take into account, among other
considerations:
o whether the fiduciary has the authority to make the investment;
o whether the investment constitutes a direct or indirect
transaction with a party in interest or disqualified person;
o the composition of the Plan's portfolio with respect to
diversification by type of asset;
o the Plan's funding objectives; the tax effects of the investment;
and
o whether under the general fiduciary standards of investment
procedure and diversification an investment in our common stock is
appropriate for the Plan, taking into account the overall
investment policy of the Plan, the composition of the Plan's
investment portfolio and all other appropriate factors.
Prior to making an investment in our common stock, a Plan investor must
determine whether we are a party in interest or disqualified person with respect
to such Plan and, if so, whether such transaction is subject to one or more
statutory or administrative exemptions, including those described above, and
whether the investment is otherwise a permissible and appropriate investment for
the Plan. Prospective investors should consult with their legal and other
advisors concerning the impact of ERISA and the Code and the potential
consequences of such investment with respect to their specific circumstances.
12
PLAN OF DISTRIBUTION
We are registering shares of our common stock on behalf of the selling
stockholders. We will pay for costs, expenses and fees in connection with the
registration of the shares, except for brokerage commissions incurred by the
selling stockholders in connection with the sale or other disposition of the
common stock. The selling stockholders may offer and sell their shares from time
to time in one or more of the following types of transactions (including block
transactions):
o on the New York Stock Exchange,
o in the over-the-counter market,
o in privately negotiated transactions,
o through put or call options transactions relating to the shares,
o through short sales of shares, or
o a combination of such methods of sale.
The selling stockholders may sell their shares at prevailing market
prices or at privately negotiated prices. Such transactions may or may not
involve brokers or dealers.
The selling stockholders may offer and sell their shares directly to
purchasers or to or through broker-dealers, which may act as agents or
principals. Such broker-dealers may receive compensation in the form of
discounts, concessions or commission from the selling stockholders and/or the
purchasers of shares.
We have agreed to indemnify each selling stockholder against certain
liabilities, including liabilities arising under the Securities Act.
Certain of the brokers, dealers or agents and their associates who may
become involved in the sale of the shares may engage in transactions with and
perform other services for us in the ordinary course of their business for which
they receive customary compensation.
LEGAL MATTERS
The validity of the Legg Mason common stock offered hereby will be
passed upon for us by our General Counsel, Robert F. Price, Esq. Mr. Price
beneficially owns, or has rights to acquire under our employee benefit plan,
less than one percent of our common stock.
INDEPENDENT ACCOUNTANTS
The financial statements and financial statement schedules incorporated
in this prospectus by reference to the Annual Report on Form 10-K of Legg Mason
for the year ended March 31, 2002 have been so incorporated in reliance on the
reports of PricewaterhouseCoopers LLP, independent accountants, given on the
authority of said firm as experts in accounting and auditing.
13
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following are the expenses in connection with the issuance and
distribution of the securities being registered, other than underwriting fees
and commissions. All such expenses other than the Securities and Exchange
Commission registration fee are estimates.
Securities and Exchange Commission Registration Fee............$263
Accounting Fees................................................$2,000
Miscellaneous..................................................$737
Total..........................................................$3,000
Item 15. Indemnification of Directors and Officers
The Registrant's By-laws provide for indemnification of any person who
is serving or has served as a director or officer of the Registrant, against all
liabilities and expenses incurred in connection with any action, suit or
proceeding arising out of such service to the full extent permitted under
Maryland law.
Section 2-418 of the Maryland General Corporation Law establishes
provisions whereby a Maryland corporation may indemnify any director or officer
made a party to an action or proceeding by reason of service in that capacity,
against judgments, penalties, fines, settlements and reasonable expenses
incurred in connection with such action or proceeding unless it is proved that
the director or officer (i) acted in bad faith or with active and deliberate
dishonesty, (ii) actually received an improper personal benefit in money,
property or services or (iii) in the case of a criminal proceeding, had
reasonable cause to believe that his act was unlawful. However, if the
proceeding is a derivative suit in favor of the corporation, indemnification may
not be made if the individual is adjudged to be liable to the corporation. In no
case may indemnification be made until a determination has been reached that the
director or officer has met the applicable standard of conduct. Indemnification
for reasonable expenses is mandatory if the director or officer has been
successful on the merits or otherwise in the defense of any action or proceeding
covered by the indemnification statute. The statute also provides for
indemnification of directors and officers by court order. The indemnification
provided or authorized in the indemnification statute does not preclude a
corporation from extending other rights (indemnification or otherwise) to
directors and officers.
The Registrant's officers and directors are insured against certain
liabilities under certain policies maintained by the Registrant with aggregate
coverage of $35,000,000.
The foregoing summaries are subject to the complete text of the
statute, by-laws and agreements referred to above and are qualified in their
entirety by reference thereto.
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Item 16. Exhibits
The following is a list of all exhibits filed as a part of this
Registration Statement on Form S-3, including those incorporated herein by
reference.
Exhibit
Number Description of Exhibit
4.1 Articles of Incorporation of Legg Mason, as amended.(1)
4.2 Bylaws of Legg Mason, as amended and restated April 25,
1988.(2)
5 Opinion of Robert F. Price, Esq.
23(a) Consent of PricewaterhouseCoopers LLP, Independent
Accountants.
23(b) Consent of Robert F. Price, Esq. (included in Exhibit 5).
24 Powers of Attorney (included in the signature pages).
____________________
(1) Incorporated by reference to Legg Mason's Quarterly Report on
Form 10-Q for the quarter ended September 30, 2000.
(2) Incorporated by reference to Legg Mason's Annual Report on Form 10-K
for the year ended March 31, 1988.
Item 17. Undertakings
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement: (i) to include any
prospectus required by section 10(a)(3) of the Securities Act of 1933; (ii) to
reflect in the prospectus any facts or events arising after the effective date
of the registration statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement; notwithstanding the
foregoing, any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume
and price represent no more than a 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the effective
registration statement; and (iii) to include any material information with
respect to the plan of distribution not previously disclosed in the registration
statement or any material change to such information in the registration
statement; provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if
the registration statement is on Form S-3 or Form S-8, and the information
required to be included in a post-effective amendment by those paragraphs is
II-2
contained in periodic reports filed with or furnished to the Commission by the
registrant pursuant to section 13 or section 15(d) of the Securities Exchange
Act of 1934 that are incorporated by reference in the registration statement;
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof; and
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
The undersigned Registrant hereby undertakes that (i) for purposes of
determining any liability under the Securities Act of 1933, the information
omitted from the form of prospectus filed as part of this registration statement
in reliance upon Rule 430A and contained in a form of prospectus filed by the
Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act
shall be deemed to be part of this registration statement as of the time it was
declared effective and (ii) for the purpose of determining any liability under
the Securities Act of 1933, each post-effective amendment that contains a form
of prospectus shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the provisions set forth in Item 15, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Baltimore, State of Maryland, on July 3, 2002.
LEGG MASON, INC.
(Registrant)
By: /s/ Raymond A. Mason
Name: Raymond A. Mason
Title: Chairman of the Board, President and
Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Raymond A. Mason, Robert F. Price
and Richard J. Himelfarb, or any of them, his true and lawful attorneys-in-fact,
with full powers of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign any and all amendments,
including any post-effective amendments, to this registration statement, and to
file the same, with exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact, and each of them, full power and authority to do and perform
each and every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as they might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact or their
substitutes may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Signatures Title Date
Chairman of the Board,
President, Chief Executive July 3, 2002
/s/ Raymond A. Mason Officer and Director
Raymond A. Mason Principal Executive Officer)
Senior Vice President
/s/ Charles J. Daley, Jr. (Principal Financial and July 3, 2002
Charles J. Daley, Jr. Accounting Officer)
/s/ James W. Brinkley Director July 3, 2002
James W. Brinkley
/s/ Harry M. Ford, Jr. Director July 3, 2002
Harry M. Ford, Jr.
/s/ Nicholas J. St. George Director July 3, 2002
Nicholas J. St. George
/s/Richard J. Himelfarb Director July 3, 2002
Richard J. Himelfarb
/s/ James E. Ukrop Director July 3, 2002
James E. Ukrop
/s/ Harold L. Adams Director July 3, 2002
Harold L. Adams
/s/ John E. Koerner, III Director July 3, 2002
John E. Koerner, III
/s/ Roger W. Schipke Director July 3, 2002
Roger W. Schipke
/s/ Edward I. O'Brien Director July 3, 2002
Edward I. O'Brien
/s/ Peter F. O'Malley Director July 3, 2002
Peter F. O'Malley
/s/ Kurt L. Schmoke Director July 3, 2002
Kurt L. Schmoke
Exhibit
Number Description of Exhibit
4.1 Articles of Incorporation of Legg Mason, as amended. (1)
4.2 Bylaws of Legg Mason, as amended and restated April 25, 1988.(2)
5 Opinion of Robert F. Price, Esq.
23(a) Consent of PricewaterhouseCoopers LLP, Independent Accountants.
23(b) Consent of Robert F. Price, Esq. (included in Exhibit 5)
24 Powers of Attorneys (included in the signature pages)
_________________
(1) Incorporated by reference to Legg Mason's Quarterly Report on Form
10-Q for the quarter ended September 30, 2000.
(2) Incorporated by reference to Legg Mason's Annual Report on Form 10-K
for the year ended March 31, 1988.