I always thought it meant you just get 5 ghost allies to add to your tally, up to a maximum of 500 allies. So if you have 395 real allies, you get 5 more so can bring 400 allies worth of units to battle. It works for junior players still getting to the 500, which makes sense if it is the first prize awarded for buying and building the LE - a gift to the newbies on the first round.
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As far as I know, 500 allies and 3000 units is a hard ceiling in any battle that can't be exceeded in any way.