Executed in 6 Parts
Counterpart No. ( )
NATIONAL EQUITY TRUST
S&P 500 STRATEGY TRUST
REFERENCE TRUST AGREEMENT
This Reference Trust Agreement dated August 18, 1998 among Prudential
Securities Incorporated, as Depositor and The Chase Manhattan Bank, as Trustee,
sets forth certain provisions in full and incorporates other provisions by
reference to the document entitled "National Equity Trust Low Five Portfolio
Series, Trust Indenture and Agreement" (the "Basic Agreement") dated April 25,
1995. Such provisions as are set forth in full herein and such provisions as
are incorporated by reference constitute a single instrument (the "Indenture").
WITNESSETH THAT:
In consideration of the premises and of the mutual agreements herein
contained, the Depositor and the Trustee agree as follows:
Part I.
STANDARD TERMS AND CONDITIONS OF TRUST
Subject to the provisions of Part II hereof, all the provisions
contained in the Basic Agreement are herein incorporated by reference in their
entirety and shall be deemed to be a part of this instrument as fully and to
the same extent as though said provisions had been set forth in full in this
instrument except that the Basic Agreement is hereby amended in the following
manner:
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A. Article I, entitled "Definitions", paragraph 22, shall be amended as
follows:
"Trustee shall mean The Chase Manhattan Bank or any successor
trustee appointed as hereinafter provided."
B. Article II, entitled "Deposit of Securities; Acceptance of Trust",
shall be amended as follows:
The second sentence of Section 2.03 Issue of Units shall be amended by
deleting the words "on any day on which the Depositor is the only Unit
Holder."
C. Article III, entitled "Administration of Trust", shall be amended as
follows:
(i) Section 3.01 Initial Costs shall be amended to substitute the
following language:
Section 3.01. Initial Cost The costs of organizing the Trust and
sale of the Trust Units shall, to the extent of the expenses
reimbursable to the Depositor provided below, be borne by the Unit
Holders, provided, however, that, to the extent all of such costs
are not borne by Unit Holders, the amount of such costs not borne
by Unit Holders shall be borne by the Depositor and, provided
further, however, that the liability on the part of the Depositor
under this section shall not include any fees or other expenses
incurred in connection with the administration of the Trust
subsequent to the deposit referred to in Section 2.01. Upon
notification from the Depositor that the primary offering period
is concluded, the Trustee shall withdraw from the Account or
Accounts specified in the Prospectus or, if no Account is therein
specified, from the Principal Account, and pay to the Depositor
the Depositor's reimbursable expenses of organizing the Trust and
sale of the Trust Units in an amount certified to the Trustee by
the Depositor. If the balance of the Principal Account is
insufficient to make such withdrawal, the Trustee shall, as
directed by the Depositor, sell Securities identified by the
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Depositor, or distribute to the Depositor Securities having a
value, as determined under Section 4.01 as of the date of
distribution, sufficient for such reimbursement. The reimbursement
provided for in this section shall be for the account of the
Unitholders of record at the conclusion of the primary offering
period and shall not be reflected in the computation of the Unit
Value prior thereto. As used herein, the Depositor's reimbursable
expenses of organizing the Trust and sale of the Trust Units shall
include the cost of the initial preparation and typesetting of the
registration statement, prospectuses (including preliminary
prospectuses), the indenture, and other documents relating to the
Trust, SEC and state blue sky registration fees, the cost of the
initial valuation of the portfolio and audit of the Trust, the
initial fees and expenses of the Trustee, and legal and other
out-of-pocket expenses related thereto, but not including the
expenses incurred in the printing of preliminary prospectuses and
prospectuses, expenses incurred in the preparation and printing of
brochures and other advertising materials and any other selling
expenses. Any cash which the Depositor has identified as to be
used for reimbursement of expenses pursuant to this Section shall
be reserved by the Trustee for such purpose and shall not be
subject to distribution or, unless the Depositor otherwise
directs, used for payment of redemptions in excess of the per-Unit
amount allocable to Units tendered for redemption.
(ii) The third paragraph of Section 3.05 Distribution shall be amended
to add the following sentence at the end thereof:
"The Trustee shall make a special distribution of the cash balance
in the Income and Principal accounts available for such
distribution to Unit Holders of record on such dates as the
Depositor shall direct."
(iii) The second to the last paragraph of Section 3.08 Sale of
Securities shall be amended to replace the word "equal" with the
following phrase: "be sufficient to pay."
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D. Reference to United States Trust Company of New York in its capacity
as Trustee is replaced by the Chase Manhattan Bank throughout the Basic
Agreement.
Part II.
SPECIAL TERMS AND CONDITIONS OF TRUST
The following special terms and conditions are hereby agreed to:
A. The Trust is denominated National Equity Trust, S&P 500 Strategy
Trust.
B. The Units of the Trust shall be subject to a deferred sales charge.
C. The contracts for the purchase of common stock listed in Schedule A
hereto are those which, subject to the terms of this Indenture, have been or
are to be deposited in Trust under this Indenture as of the date hereof.
D. The term "Depositor" shall mean Prudential Securities Incorporated.
E. The aggregate number of Units referred to in Sections 2.03 and 9.01
of the Basic Agreement is 375,000 as of the date hereof.
F. A Unit of the Trust is hereby declared initially equal to
1/375,000th of the Trust.
G. The term "First Settlement Date" shall mean August 24, 1998.
H. The terms "Computation Day" and "Record Date" shall mean
November 10, 1998, February 10, 1999, May 10, 1999 and August 10, 1999.
I. The term "Distribution Date" shall mean November 25, 1998,
February 25, 1999, May 25, 1999 and August 25, 1999.
J. The term "Termination Date" shall mean September 17, 1999.
K. The Trustee's Annual Fee shall be $0.80 (per 1,000 Units) for
100,000,000 and above units outstanding; $0.85 (per 1,000 Units) for
50,000,000 - 99,999,999 units outstanding; $0.91
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(per 1,000 Units) for 49,999,999 and below units outstanding. In calculating
the Trustee's annual fee, the fee applicable to the number of units
outstanding shall apply to all units outstanding.
L. The Depositor's Portfolio supervisory service fee shall be $0.25 per
1,000 Units.
[Signatures and acknowledgments on separate pages]
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The Schedule of Portfolio Securities in Part A of the prospectus
included in this Registration Statement for National Equity Trust, S&P
500 Strategy Trust is hereby incorporated by reference herein as
Schedule A hereto.
