Exhibit 1
THE PAINEWEBBER EQUITY TRUST,
GROWTH STOCK SERIES 21
TRUST INDENTURE AND AGREEMENT
Dated as of January 8, 1998
Incorporating
Standard Terms and Conditions of Trust
Dated as of July 10, 1990,
Between
PAINEWEBBER INCORPORATED,
as Depositor
and
INVESTORS BANK & TRUST COMPANY
as Trustee
THIS TRUST INDENTURE AND AGREEMENT dated as of January 8,
1998 between PaineWebber Incorporated, as Depositor and Investors Bank & Trust
Company, as Trustee, which sets forth certain of its provisions in full and
incorporates other of its provisions by reference to a document entitled
"Standard Terms and Conditions of Trust" dated as of July 10, 1990, among the
parties hereto (hereinafter called the "Standard Terms"), such provisions as
are set forth in full and such provisions as are incorporated by reference
constituting a single instrument.
W I T N E S S E T H T H A T :
WHEREAS, the parties hereto have heretofore or concurrently
herewith entered into the Standard Terms in order to facilitate creation of a
series of securities issued under a unit investment trust pursuant to the
provisions of the Investment Company Act of 1940 and the laws of the State of
New York, each of which series will be composed of redeemable securities
representing undivided interests in a trust fund composed of publicly traded
common or preferred stocks issued by domestic companies, and, in certain cases,
interest-bearing United States Treasury Obligations ("Treasury Obligations");
and
WHEREAS, the parties now desire to create the Twenty-first
Growth Stock trust of the aforesaid series;
NOW THEREFORE, in consideration of the premises and of the
mutual agreements herein contained, the Depositor and the Trustee agrees as
follows:
Section 1. Incorporation of Standard Terms and Conditions of
Trust. Subject to the provisions of Sections 2, 3 and 4 of this Trust Indenture
and Agreement set forth below, all of the provisions of the Standard Terms
incorporated by reference in their entirety and shall be deemed to be a part of
this instrument as fully to all intents and purposes as though said provisions
had been set forth in full in this instrument. Unless otherwise stated, section
references shall refer to sections in the Standard Terms.
Section 2. Specific Terms of this Series. The following terms
are hereby agreed to for this series of The PaineWebber Equity Trust, which
series shall be known and designated as "The PaineWebber Equity Trust, Growth
Stock Series 21".
A. (1) The aggregate number of Units outstanding on the date
hereof for this Series is 100,000.
(2) The initial fractional undivided interest represented
by each Unit of this series shall be 1/100,000th of the Trust Fund. A receipt
evidencing the ownership of this total number of Units outstanding on the date
hereof is being delivered by the Trustee to the Depositor.
B. The term "Record Date" shall mean March 31, 1998 and
quarterly thereafter; provided, however, that with respect to a distribution
required by Section 2.02(b), the Record Date shall be the last business day of
the month during which the contract to purchase the Security fails.
Record Date shall also include such date or dates determined
by the Sponsor and the Trustee as necessary or desirable and in the best
interest of the Unitholders for federal or state tax purposes, or for other
purposes (hereinafter a "Special Record Date") which date may replace a
regularly scheduled Record Date if such regularly scheduled Record Date is
within 30 days of a Special Record Date.
C. The term "Distribution Date" shall mean the 20th day
following each Record Date, commencing April 20, 1998, and quarterly
thereafter with respect to Income Account Distributions and shall mean
January 20, 1999 and annually thereafter with respect to Capital Account
Distributions, except that the Trustee may declare a Record Date of December
31 in any year for a Distribution Date of January 20 of the following year, if
required for compliance with the rules and regulations governing regulated
investment companies. With respect to a distribution required by Section
2.02(b), the Distribution Date shall be twenty days after the Record Date with
respect thereto.
In the event a Special Record Date is declared, Distribution
Date shall also include such Date as is determined by the Sponsor and the
Trustee to be the Distribution Date in respect of such Special Record Date.
D. The Discretionary Liquidation Amount shall be fifty per
centrum (50%) of the aggregate value of the Securities originally deposited on
the date hereof and subsequently deposited pursuant to any Supplemental
Indenture pursuant to Section 2.02.
E. The Mandatory Termination Date shall be January 30, 2003.
Unless advised to the contrary by the Sponsor, the date on which the Trustee
shall begin to sell equity Securities in accordance with Section 9.01 shall be
January 10, 2003.
F. The Trustee's annual compensation as referred to in
Section 8.05 shall be $.0170 per Unit computed monthly based on the largest
number of Units outstanding during the preceding month.
G. The Sponsor's annual compensation pursuant to Section 7.02
shall be computed as $.0035 per Unit, based on the largest number of Units
outstanding in a calendar year.
H. The balance in the Capital Account below which no
distribution need be made, as referred to in Section 3.04, is $.05 per Unit
Outstanding.
I. Article I shall be amended as follows:
1. The definition of "Securities" shall be deleted in its
entirety and the following text shall be inserted in replacement thereof:
"Shall mean the Securities, including Contract Securities,
(a) which are listed or referred to as Securities in Schedule
A to the Trust Indenture or any Supplemental Indenture, (b)
which have been received by the Trust in exchange or
substitution pursuant to Section 3.07 hereof as may from time
to time continue to be held as part of a Trust and (c) which
are additional deposits of Securities made pursuant to
Section 2.02, 3.02 and 3.15."
2. The definition of "Supplemental Indenture" shall be
deleted in its entirety and the following text shall be inserted in replacement
thereof:
"Shall mean a written direction from the Sponsor to the
Trustee instructing the Trustee to create additional Units
pursuant to and in accordance with 2.02(c) hereof."
3. The definition of "Percentage Ratios" shall be deleted in
its entirety and the following text shall be inserted in replacement thereof:
"Shall have the meaning assigned to it in Section 2.02."
J. Section 2.02 shall be deleted in its entirety and the
following text shall be inserted in its place:
"Section 2.02. Deposit of Securities. (a) The Sponsor
concurrently with the execution and delivery hereof, hereby
grants and conveys all of its right, title and interest in
and to and hereby conveys to and deposits with the Trustee in
an irrevocable Trust, the Securities (together with accrued
and unpaid income thereon) and Contract Securities, listed in
Schedule A to the Indenture, duly endorsed in blank or
accompanied by all necessary instruments of assignment and
transfer in proper form, to be held, managed and applied by
the Trustee as herein provided for the benefit of each
Unitholder to the extent of such Unitholder's interest in the
Trust Fund. The Sponsor hereby also delivers to the Trustee a
certified check or checks, cash or cash equivalents or an
irrevocable letter or letters of credit issued by a
commercial bank or banks in an amount necessary to consummate
the purchase of any Contract Securities. The Percentage
Ratios for the Trust Fund shall be the percentage ratios
between the number of shares of each issue of stock in such
Trust deposited in such Trust Fund on
the initial date of deposit thereof (the "Initial Date of
Deposit") and determined by reference to Schedule A to the
Indenture for such Trust Fund. Such Percentage Ratios are
subject to adjustment to reflect the occurrence of (i) a
stock split or a similar event which affects the capital
structure of the issuer of a stock but which does not affect
the Trust's percentage ownership of the common stock equity
of such issuer at the time of such event, (ii) a merger or
reorganization, (iii) a sale of any Securities from the Trust
portfolio, or (iv) Securities deposited pursuant to Section
2.02(b). Stock dividends received by the Trust, if any,
pursuant to Section 3.07(d) will be sold by the Trustee and
the proceeds therefrom shall be treated as income to the
Trust.
(b) In the event that the purchase of Contract Securities
pursuant to any contract shall not be consummated in
accordance with said contracts, moneys held for the purchase
of such Contract Securities shall be credited to the Capital
Account and the Trustee, as directed by the Sponsor, shall
either (1) use the cash held or available under a letter or
letters of credit to purchase other stock or stocks having
characteristics sufficiently similar to the stocks originally
deposited or (2) distribute such moneys pursuant to Section
3.04 to Unitholders of record as of the Record Date next
following the failure of consummation of such purchase. The
Sponsor shall cause to be refunded to each Unitholder his pro
rata portion of the sales charge levied on the sale of Units
to such Unitholder attributable to such Contract Security.
(c) From time to time, following the Initial Date of Deposit,
the Sponsor is hereby authorized, in its discretion to cause
the Trustee to issue additional Units pursuant to a
Supplemental Indenture directing such additional Units to be
created based upon the following:
(1) the deposit of additional Securities in respect of
such additional Units and/or contracts for the
purchase of such additional Securities; and/or
(2) the deposit of cash in an amount to purchase such
additional Securities based upon the price of such
additional Securities at the Valuation Time on such
date of deposit.
To accomplish the issuance of additional Units by means of a
deposit of additional Securities, the Sponsor is authorized
to assign, convey to and deposit with the Trustee (i)
additional Securities, duly endorsed in blank or accompanied
by all necessary instruments of assignment, and/or (ii)
contracts for the purchase of such additional Securities, and
the Sponsor shall transfer and deliver such necessary
instruments of assignment and/or contracts for the purchase
of such additional Securities to the Trustee along with a
certified check or checks, cash, cash equivalents or an
irrevocable letter or letters of credit issued by a
commercial bank in an amount necessary to consummate the
purchase of any such additional Securities represented by
contracts for the purchase of additional Securities.
To accomplish the issuance of additional Units by means of
depositing sufficient cash amounts with the Trustee to enable
the Trustee to purchase and deposit the additional
Securities, the Sponsor is hereby authorized to, and shall,
instruct the Trustee to create a specified number of
additional Units whereupon the Trustee shall purchase and
deposit the additional Securities in respect thereof.
Brokerage commissions with respect to the Trustee's purchase
of additional Securities, if any, shall be an expense borne
by the Trust. In all cases of creating additional Units, the
Sponsor shall also pay to the Trustee for deposit into the
Income Account an amount equal to the Cash Component per Unit
(as defined below), multiplied by the number of new Units
created in respect of the additional Securities deposited
into the Trust Fund pursuant to this Section 2.02(c). For
purposes of this paragraph, Cash Component means cash on hand
in the Trust Fund (excluding cash held for the purchase of
Contract Securities) and/or cash receivable by the Trust as
of the date of the deposit of additional Securities, reduced
by payables and accrued expenses and amounts allocated for
redemption of Units or for distribution to holders of record
as of a preceding Record Date. Such purchase and deposit of
additional Securities shall be made, in each case, pursuant
to a Supplemental Indenture. Except as provided in Section
3.07(d) the Sponsor, if depositing additional Securities with
the Trustee pursuant to this Section 2.02(c), and the Trustee,
if purchasing additional Securities with amounts provided to
it by the Sponsor pursuant to this Section 2.02(c), in each
case shall ensure that each deposit of additional Securities
pursuant to this Section shall be made so as to maintain as
closely as practicable the Percentage Ratios for such
Securities determined by reference to Schedule A of the Trust
Indenture for each Trust Fund and subject to adjustment as
provided herein.
The Securities deposited pursuant to this Section 2.02 are
comprised of (1) the Securities set forth in Schedule A of
the Trust Indenture, (2) any additional deposits of
Securities made in connection with the reinvestment of cash
proceeds in accordance with Section 3.02 and
pursuant to the provisions of Section 3.15, (3) any Treasury
Securities which may be deposited as temporary reinvestment
for sale proceeds pursuant to Section 3.02, and (4)
additional deposits of Securities pursuant to Section 2.02(b)
and this Section 2.02(c). Such additional Securities shall be
held, managed and applied by the Trustee as herein provided
and as provided in the applicable Trust Indenture.
(d) The Trustee is hereby irrevocably authorized to effect
registration or transfer of the Securities in fully
registered form to the name of the Trustee or to the name of
its nominee or the nominee of its agent."
K. Section 3.01 shall be deleted in its entirety and the
following text shall be inserted in its place:
"Section 3.01. Certain Moneys to Be Credited to Income
Account. The Trustee shall collect the Income on the
Securities as it becomes payable and credit all income to a
separate non-interest bearing account to be known as the
"Income Account", on the date on which the Trust Fund
receives such Income, or on the date it accrues with respect
to Securities issued at an original issue discount (including
all moneys realized by the Trustee from the sale of options,
warrants or other similar rights received in respect of the
Securities and including any stock dividends sold pursuant to
Section 3.07)."
L. The text of Section 3.02 shall be deleted and the
following text shall be inserted in its place:
"Section 3.02. Certain Moneys to Be Credited to Capital
Account. All moneys other than amounts credited to the Income
Account received by the Trustee in respect of the Securities
under this Indenture shall be credited to a separate
non-interest bearing account to be known as the "Capital
Account". If Securities in a Trust are to be sold pursuant to
Section 3.06 or 3.07, the proceeds of such sale, or moneys
received as a distribution of capital as the result of any
corporate or other business action of the issuer of a
Security in the Trust, may be reinvested, upon the
instruction of the Sponsor, (x) in additional Securities held
at such time in the Trust Fund on a pro rata basis in the
manner set forth in, and to the extent permitted by, Section
3.15 or (y) if not so permitted by Section 3.15, if (1) at
the time there is no legal or regulatory impediment and (2)
in the opinion of the Sponsor it is in the best interests of
the Unitholders to do so, in U.S. Treasury Obligations which
mature on or prior to the next scheduled Distribution Date
(the "Short-Term Treasury
Obligations"). Any Short-Term Treasury Obligations purchased
pursuant to this Section 3.02 shall be deposited into the
applicable Trust and shall be subject to the terms of such
Trust Indenture and Agreement to the same extent as any
Security deposited into such Trust on the Initial Date of
Deposit and the terms "Trust Fund" and "Securities" shall
thereafter be defined as including such Short-Term Treasury
Obligations. Brokerage commissions with respect to the
purchase of such Securities or Short-Term Treasury
Obligations, if any, shall be an expense borne by the Trust.
Anything in this Section 3.02 to the contrary
notwithstanding, moneys which are required to cover the
purchase of Contract Securities shall be held specially by
the Trustee for such purchase and shall not be deemed to be
part of the Capital Account until the Sponsor shall have
notified the Trustee that such contracts have failed,
whereupon such moneys shall be credited to the Capital
Account and, unless reinvested pursuant to Section 2.02(b),
shall be held specially for distribution in the manner
provided in Section 2.02(b)."
M. The text of Section 3.04 shall be deleted and the
following text shall be inserted in its place:
"Section 3.04. Certain Deductions and Distributions. Each
month the Trustee shall satisfy itself as to the adequacy of
the Reserve Account, making any further credits thereto as
may appear appropriate in accordance with Section 3.03 and
shall then:
(a) deduct from the Income Account or, to the extent such
funds are not available in such Account, from the Capital
Account, or to the extent such funds are not available in
such Account, sell Securities in accordance with Section
5.02, and pay to itself individually the amounts that it is
at the time entitled to receive pursuant to Sections 8.01 and
8.05 on account of its services theretofore performed and
expenses, losses and liabilities theretofore incurred, if
any;
(b) deduct from the Income Account or, to the extent funds
are not available in such Account, from the Capital Account,
and pay to itself individually an amount equal to the portion
of the advance for Initial Costs specified in 10.02(b) for
which it is then entitled to reimbursement pursuant to such
section;
(c) deduct from the Income Account or, to the extent funds
are not available in such Account, from the Capital Account,
and pay to the Sponsor or successor Sponsor the amount that
it is entitled to receive pursuant to Sections 7.02 and
8.01(f); and
(d) to the extent that the Trustee has been advised that
costs incurred in keeping the registration of Units and the
Trust on a current basis are permitted to be deducted at that
time by the Securities and Exchange Commission, deduct from
the Income Account, or to the extent funds are not available
in such Account, from the Capital Account, an amount equal to
the unpaid fees and expenses incurred in keeping the
registration statement current as provided in Section 10.03.
Any amounts that the Trustee has paid pursuant to (c) above
in excess of the amount to which the Sponsor is entitled
pursuant to Section 7.02, shall be returned to the Trust and
distributed on the next Distribution Date to Unitholders of
record on the preceding Record Date.
On each quarterly Distribution Date with respect to Income
Account Distributions ("Income Distributions"), and on each
annual Distribution Date with respect to Capital Account
Distributions ("Capital Distributions"), or within a
reasonable period of time thereafter, the Trustee shall
distribute by mail to each Unitholder of record at the close
of business on the preceding Record Date at his address
appearing on such Record Date on the registration books of
the Trustee or by such other means as may be mutually agreed
upon by the Trustee and the Unitholder, such Unitholder's
pro rata share of the balance of the Income and/or Capital
Accounts, as the case may be, computed as of such Record Date
in the manner set forth below provided, however that the
Trustee, if so directed with respect to such distributions
from the Income Account only in a writing signed by the
Sponsor on behalf of Unitholders electing the reinvestment
plan offered in the Prospectus ("Reinvestment Plan") and
received by the Trustee on or before the Record Date for the
first distribution to which such notice is to apply, use
such distributions to purchase Units from the Sponsor, which
may be Units held by the Sponsor or additional Units created
pursuant to the provisions of Section 2.02, for the accounts
of such Unitholders under the terms and conditions set forth
in the Prospectus. Only whole Units shall be purchased
pursuant to this Section.
The Trustee shall on or before each Distribution Date in
respect of Income Distributions and/or Capital Distributions,
as the case may be, compute the amount of the distribution
per Unit for such Distribution Date (i) by deducting, as
applicable, from the cash on hand in the Capital and Income
Accounts as of the Record Date immediately preceding such
Distribution Date the total of (X) cash required for the
redemption of unredeemed tendered Units and (Y) the sum of
the amounts to be deducted from such Accounts on or before
such Distribution Date pursuant to the foregoing provisions
of this Section 3.04 and (ii) dividing the amount
so obtained by the number of Units outstanding on the Record
Date immediately preceding such Distribution Date.
No distribution need be made from the Capital Account if the
balance therein is less than an amount set forth in the
Indenture.
The amount to be so distributed to each Unitholder shall be
that pro rata share of the cash balance of the Income or
Capital Accounts, as the case may be, computed as set forth
herein, as shall be represented by the number of Units
evidenced by the number of Units held of record by such
Unitholder. In making the computation of such holder's pro
rata share of the balance of the Income and Capital Accounts,
fractions of less than one cent shall be omitted.
In the event a Unitholder of a particular series of any Trust
fund is also a Unitholder of one or more other series of a
trust for which the Trustee is the trustee and for which the
Sponsor is the sole depositor, and such Unitholder has not
elected to participate in the Reinvestment Plan, then the
Trustee shall consolidate in one check the distribution
required to be made to a Unitholder hereunder with all other
distributions required to be made on such Distribution Date
to such Unitholder pursuant to the indenture governing such
other series; provided that an appropriate statement of
distribution be furnished therewith as required by the
applicable Trust Indenture."
N. The second paragraph of Section 3.05 shall be amended as
follows:
the phrase "Within a reasonable period of time after
the last day of each calendar year. . ." shall be
deleted and the following phrase shall be
substituted therefor: "Within 60 days following the
last day of each calendar year commencing with
calendar year 1998.
O. The text of Section 3.06 shall be deleted in its entirety
and the following text shall be inserted in its place:
"Section 3.06. Sale of Securities and of Certain Rights. The
Sponsor by written notice may direct the Trustee to sell
Securities at such price and time and in such manner as shall
be deemed appropriate by the Sponsor if the Sponsor shall
have determined that any one or more of the following
conditions exist:
(a) that there has been a failure to declare or pay
anticipated dividends or interest;
(b) that any materially adverse action or proceeding has been
instituted at law or in equity seeking to restrain or enjoin
the declaration or payment of dividends or interest on any
such Securities or that there exists any other materially
adverse legal question or impediment affecting such
Securities or the declaration or payment of dividends or
interest on the same;
(c) that there has occurred any breach of covenant or
warranty in any trust indenture or other document relating to
the issuer or obligor or guarantor which might materially and
adversely affect either immediately or contingently the
declaration or payment of dividends or interest on such
Securities;
(d) that there has been a default in the payment of the
principal or par or stated value of, premium, if any, or
income on any other outstanding securities of the issuer or
the guarantor of such securities which might materially and
adversely, either immediately or contingently, affect the
declaration or payment of dividends on the Securities;
(e) that a decline in price has occurred or such materially
adverse market or credit factors have occurred, that in the
opinion of the Sponsor the retention of such Securities would
not be in the best interest of the Unitholders;
(f) that the sale of such Securities is desirable in order to
maintain the qualification of the Trust Fund as a "Regulated
Investment Company" in the case of a trust which has elected
to qualify as such;
(g) that there has been a decrease in the Sponsor's internal
rating of the Security; or
(h) that there has been a happening of events which, in the
opinion of the Sponsor, negatively affects the economic
fundamentals of the issuer of the Security or the industry of
which it is a part.
Upon receipt of such direction from the Sponsor with respect
to any Securities, or in the case of options, warrants or
other rights to purchase securities distributed to the Trust
in respect of Securities as soon as is practicable after
receipt of such options, warrants or other rights, the
Trustee shall proceed to sell the specified Securities or any
such rights. The Trustee shall not be liable or responsible
in any way for depreciation or loss incurred by reason of any
sale made pursuant to any such direction or by reason of the
failure of the Sponsor to give any such direction, and in the
absence of such direction the Trustee shall have no duty to
sell any Securities under this Section 3.06 except to the
extent otherwise required by Section 3.10. The Sponsor shall
not be liable for errors of judgment in directing or failing
to direct the Trustee pursuant to this Section 3.06. This
provision, however, shall not protect the Trustee or Sponsor
against any liability for which they would otherwise be
subject by reason of willful misfeasance, bad faith or gross
negligence in the performance of their obligations and duties
hereunder."
P. The text of Section 3.07 shall be deleted in its entirety
and the following text shall be inserted in its place:
"Section 3.07. Tender Offers, Reorganizations and Similar
Events, Stock Dividends.
The Sponsor irrevocably instructs the Trustee as follows:
(a) In the event of a tender offer for any Security (a
"Tender Stock") deposited in the Trust, by 1:00 p.m. three
Business days before the
expiration of the best tender offer then in effect (that
being the tender offer of the highest value as determined by
the Sponsor and timely communicated to the Trustee) (the
"Best Offer") that (except as further provided in clause (d)
below) the Sponsor shall instruct the Trustee and the Trustee
shall tender the Tender Stock; provided however, the Trustee
shall place a limit order on such date, expiring at the close
of business on such date, for 90% of such Best Offer's value
as determined by the Sponsor; provided further, that in the
event the Best Offer is of an unconditional tender offer for
all outstanding Tender Stock and is not conditioned upon the
offeror's receipt of financing, such Tender Stock shall be
tendered and not sold. Any securities received pursuant to a
consummated tender offer shall be sold by the Trustee as soon
as practicable. Any Tender Stock which cannot be sold as set
forth above will be tendered;
(b) In the event Tender Stock has been tendered but a better
tender offer (that being a tender offer with a higher value
than a previous Best Offer, as determined by the Sponsor) (a
"Better Offer") is thereafter made prior to the expiration of
any withdrawal rights, the Sponsor shall timely notify the
Trustee and the Trustee shall use its best efforts to
exercise its withdrawal rights and apply the procedures set
forth in (a) above for the Better Offer;
(c) Upon the consummation of a tender offer, in the event any
Tender Stock is not accepted pursuant to the terms of a
tender offer, the Trustee shall sell the Tender Stock as soon
as practicable;
(d) Except as provided in subparagraph (2) below,
(1) during the periods during which the Sponsor creates
Additional Units for the Trust, the Trustee shall not
tender or sell Tender Stock.
(2) On any Distribution Date relating to an Income
Distribution, if the Trustee creates Additional Units for
the Reinvestment Plan in accordance with Section 2.02,
and if the Trustee sells or tenders Tender Stock(s) in
accordance with subparagraphs (a), (b) or (c) on such
Distribution Date, then the Trustee shall not include
such Tender Stock(s) in the deposit of additional
Securities but instead shall adjust the Percentage Ratios
so that the Trust's percentage ownership of such Tender
Stock(s) shall be allocated on a pro rata basis to the
remaining Securities held in the Trust Fund.
(e) In the event of a sale of substantially all of the assets
of an issuer of a Security or merger of an issuer of a
Security into another issuer, the Trustee shall sell the
affected Security pursuant to a limit order for 90% of the
value to be received by shareholders in such transaction (as
determined by the Sponsor), after the announcement of such
transaction. If after such acquisition or merger the Trustee
still holds Security upon such acquisition or merger or any
resulting securities are received in respect to Security the
Trustee shall sell them as soon as practicable.
(f) In the event the issuer of a Security announces that
another company or companies will be merged into it, the
Trustee shall retain such Security
unless the Sponsor directs the Trustee to sell the Security
for one or more of the reasons set forth in Section 3.06.
(g) In the event of a corporate reorganization, the Trustee
shall sell securities received in respect of a Security as
soon as practicable.
(h) The Sponsor shall immediately advise the Trustee if it is
unable to determine (i) if an offer is a Best Offer or Better
Offer or (ii) the value of a tender offer, sale of
substantially all assets or merger. In such event, (a) in the
case of a tender offer, the Trustee shall sell the Tender
Stock as close to the opening of the stock exchanges as is
practicable on the last business day a tender offer is in
effect and (b) in the event of a sale of substantially all
assets or mergers, the Trustee shall continue to hold the
Security.
(i) In the event the Trustee is notified of any vote to be
taken or proposed to be taken by holders of the Securities
held by the Trust Fund in connection with any activity or
matter not otherwise covered by this Section 3.07, the
Trustee shall take such action with respect thereto as the
Sponsor shall direct.
(j) If, stock or securities are received by the Trustee, with
or without cash, as a result of any activity or matter not
otherwise covered by subsections (a) through (h) of this
Section 3.07 (including any stock or securities received
notwithstanding the Trustee's rejection of an offer or
received without an initial offer), the Trustee at the
direction of the Sponsor may retain or sell such stock or
securities in the Trust Fund. Any stock
or securities so retained shall be subject to the terms and
conditions of the Indenture to the same extent as the
Securities originally deposited hereunder. The Trustee shall
give notice to the Unitholders of the retention of stock or
securities acquired in exchange for Securities within five
days after such acquisition.
(k) Additional shares of Securities received as a
distribution on Securities (other than shares received in a
non-taxable distribution which shall be retained by the Trust
Fund) shall be sold and the proceeds credited to the Income
Account."
Q. The first paragraph of Section 3.10 shall be amended by
deleting the first word of the paragraph, "In", and inserting the following
text in its place:
"Except as otherwise provided for in Section 3.07, in".
R. In the event that the Sponsor directs the Trustee to
distribute Securities in lieu of a cash redemption pursuant to Section 5.02 of
the Standard Terms, the Trustee shall so distribute the stocks and distribute
only stocks in a proportionate amount, rounding to avoid the delivery of
fractional shares and where such rounding is not possible by delivering stocks
and an amount equal to the difference between the Redemption Value and the
value of such stocks delivered (determined in accordance with Section 4.01 on
the date of tender).
S. The text of Section 3.13 shall be deleted and the
following text shall be inserted in its place:
"Section 3.13. Election to Qualify as Regulated Investment
Company; Diversification Tests. (a) The Trust intends to
elect to be treated and to qualify as a Regulated Investment
Company as defined in the Internal Revenue Code and the
Trustee is directed to make such elections, including any
appropriate election to be taxed as a corporation, as shall
be necessary to effect such qualification.
(b) The Trustee shall furnish to independent certified public
accountants designated by the Sponsor pursuant to Section
8.01(e) the value of the Securities in the Trust Fund as of
(1) the Friday (or the immediately preceding Business Day if
such Friday is not a Business Day) before the last Business
Day of the first quarter of the Trust Fund's first taxable
year (2) the last Business Day of the first quarter of the
Trust Fund's first taxable year, and (3) the last Business
Day of any subsequent quarter during which any Securities are
acquired by the Trust Fund. For purposes of this Section 3.13
each said day shall,
except as the context may otherwise require, be hereinafter
referred to as the "Diversification Test Date".
On each Diversification Test Date upon written request from
the Trustee no later than five Business Days prior thereto,
which date shall be specified by the Trustee in such request,
such accountants shall send a written report, in form and
substance satisfactory to the Trustee and its counsel, to the
Trustee and to the Sponsor stating whether or not the
aggregate value of all Securities (other than U.S. Government
Securities) of each issuer, Securities issued by which are
valued at greater than 5% of the total assets of the Trust
Fund, exceeds 50% of the value of the total assets of the
Trust Fund on such Diversification Test Date. In making the
necessary computations, such accountants shall compute the
value of the Securities by taking the value of the Securities
in the Trust Fund, as so furnished by the Trustee, including
the amount of any accrued interest thereon, by treating as
Securities of the same issuer only those Securities whose
name so indicates; by treating contracts to purchase
Securities as if the Securities subject to such contracts had
been acquired by the Trust Fund; and by the settlement of
contracts to purchase Securities as the acquisition of
Securities on their respective settlement dates.
In the event the foregoing certification by such accountants
states that the aggregate value of Securities (other than
U.S. Government Securities) of each issuer, Securities issued
by which are valued at more than 5% of the total assets of
the Trust Fund, on the Friday (or the immediately prior
Business Day if such Friday is not a Business Day) before the
last Business Day in the first quarter of the first taxable
year of the Trust Fund exceeds 50% of the total assets of the
Trust Fund on such date, as provided in Section 3.06, the
Sponsor shall direct the Trustee to sell all or any portion
of the Securities whose value is greater than 5% of total
assets of the Trust Fund or take such other action as is
necessary so that the aggregate value of Securities (other
than U.S. Government Securities) of each issuer, Securities
issued by which have values greater than 5% of the total
assets of the Trust Fund, does not exceed 50% of the value of
the total assets of the Trust Fund on the last Business Day
of the first quarter of the first taxable year of the Trust
Fund. On the last day of the first quarter of the first
taxable year of the Trust Fund the Sponsor shall provide a
certificate satisfactory in form and substance to the Trustee
and its counsel to the effect that the aggregate value of all
Securities (other than U.S. Government Securities) of each
issuer, Securities issued by which are valued at greater than
5% of the total assets of the Trust
Fund does not exceed 50% of the value of the Fund's total
assets on the last day of the quarter.
In order to ensure the continued qualification as a Regulated
Investment Company of a trust which has elected to so
qualify, the Trustee shall cause a review of the Trust to be
performed by such accountants prior to the end of the
calendar year. The purpose of such review shall be to
determine whether the Trust is deriving at least 90% of its
gross income from dividends, interest and gains from the sale
or other disposition of the Securities. The Trustee shall
submit the written results of such review to the Sponsor.
In the event that the foregoing audit states that less than
90% of the gross income of the Trust is derived from
dividends, interest and gains from the sale or other
disposition of the Securities, the Sponsor shall direct the
Trustee to sell certain of the Securities pursuant to Section
3.06 in an amount deemed necessary by the Sponsor to maintain
the status of the Trust as a Regulated Investment Company."
In performing the duties set forth in this Section 3.13, the Trustee
may seek the advice of the independent certified public accountants designated
by the Sponsor pursuant to Section 8.01 hereof and may rely upon the advice of
such accountants."
S. The Trustee will calculate the Trust's value, as provided
in Section 5.01 on the dates set forth in said Section 5.01 and additionally
upon termination (or the last business day prior thereto).
T. The Standard Terms shall be amended to add new Section
3.15 as follows:
Section 3.15. Reinvestment of Cash Proceeds. If and to the
extent that the Sponsor, on behalf of the Trust, receives a
favorable response to its no-action letter request submitted
to the Securities and Exchange Commission with respect to
reinvesting cash proceeds received by the Trust, the Trustee
shall, upon receipt of instructions from the Sponsor,
reinvest such cash proceeds in additional Securities held in
the Trust Fund at such time. Such reinvestment shall be made
so that each deposit of additional Securities shall be made
so as to match as closely as practicable the Percentage
Ratios, and such reinvestment shall be made in accordance
with the parameters set forth in the no-action letter
response. If the Sponsor and the Trustee determine that it
shall be
necessary to amend the Standard Terms and Agreement and/or
the Indenture to comply with the parameters set forth in the
no-action letter response, such documents may be so amended
without the consent of Unitholders.
U. In the event that any issuer of a Security in the Trust
issues a stock dividend in lieu of a cash dividend, such dividend shall be sold
by the Trustee, and the proceeds thereof shall be Income, as defined in the
Standard Terms, and shall be deposited into the Income Account and distributed
as of the next succeeding Income Account Distribution Date.
V. All Units will be held in book-entry form, except that
upon request a Unitholder may receive a certificate representing beneficial
ownership of its Units.
W. Section 10.02 of the Standard Terms shall hereby be
amended as follows:
1. the text of Section 10.02 shall be deleted in its
entirety and;
2. the following text set forth below shall be inserted
in replacement of such Section 10.02: "Section
10.02. Initial Costs (a) The Initial Costs incurred
by the Sponsor and the Trustee in connection with
the organization and establishment of the Trust (the
"Initial Costs") shall be paid by the Trust, or if
paid for by the Trustee initially, shall be
reimbursed by the Trust to the Trustee in accordance
with Sections 3.04(b) and 8.05.
(b) Initial Costs to be charged to the Trust
include, but are not limited to
(1) the costs of the initial
preparation, typesetting and
execution of the registration
statement, prospectuses (including
preliminary prospectuses), the
trust indenture and other legal
documents relating to the
establishment of the Trust, and
the costs of submitting such
documents in electronic format to
the SEC,
(2) SEC and state blue sky
registration fees for the initial
registration of Trust Units,
(3) the cost of the initial audit of
the Trust,
(4) the legal costs incurred by the
Sponsor and the Trustee related to
any and all of the foregoing, and
(5) other out-of-pocket expenses
related to any and all of the
foregoing.
(c) Costs and expenses incurred in the
marketing and selling of Trust Units, shall
not be borne by the Trust but shall be paid
for by the Sponsor. Such costs and expenses
include but are not limited to (1) any
expenses incurred in the printing of
prospectuses (including preliminary
prospectuses), (2) the preparation and
printing of brochures and other advertising
or marketing materials, including any legal
costs incurred in the review thereof, and
(3) any other selling or promotional costs
or expenses.
(d) Promptly after the Initial Date of Deposit,
upon written certification to the Trustee,
the Sponsor shall receive reimbursement for
any of the Initial Costs set forth in
subsection (b) above which are payable from
the Trust but which were paid for by the
Sponsor, without profit. The Trustee shall
advance out of its own funds such
reimbursement, provided, however that the
Trustee shall be entitled to be reimbursed
without interest out of the Trust Fund for
any and all amounts advanced by it pursuant
to this Section 10.02(d), in the manner set
forth in Section 3.04(a). Such advances
shall be considered a lien on the Trust
Fund, and the Trustee shall have a priority
over Unitholders on funds received in
respect of the Securities in the Trust, as
such funds are received.
(e) The Trustee shall reimburse itself for the
advances made pursuant to subsection (d)
above in 60 months approximately equal
installments over a five (5) year period
unless (i) the Trust is sooner terminated,
in which case all amounts still due and
owing shall be payable to the Trustee from
the assets of the Trust or (ii) by law or
regulation the Trust is required to
amortize costs set forth in subsection (b)
over a period of time shorter than 60
months, in which case the Trustee shall
follow the requisite time period for such
reimbursement.
(f) The Sponsor shall bear the Initial Costs,
if any, in excess of $100,000."
X. For the purpose of this Trust, Section 10.03(e) shall be
amended so that the text below shall be added to the paragraph following the
last sentence thereof:
"So long as the Sponsor is maintaining a secondary
market for Units, the Sponsor shall bear any audit
expense which exceeds $.0050 per Unit".
Section 3. The Trust hereby elects to qualify as a Regulated
Investment Company under the Internal Revenue Code of 1986, as amended.
Section 4. All references in the Standard Terms to the First
National Bank of Chicago shall be deleted in their entirety, all references to
the term "Co-Trustees" shall be deleted and the term "Trustee" shall be
inserted in replacement thereof, the definition of "Trustee" in Article I shall
be amended to delete the reference to First National Bank of Chicago and all
terms relative to the Trustee shall be interpreted in the singular.
IN WITNESS WHEREOF, PaineWebber Incorporated has caused this
Trust Indenture and Agreement to be executed by one of its Vice Presidents and
its corporate seal to be hereto affixed and attested by one of its Assistant
Secretaries, and Investors Bank & Trust Company has caused this Trust Indenture
to be executed by one of its Authorized Signatories and its corporate seals to
be hereto affixed and attested by one of its Authorized Signatories, all as of
the date first above written.
PAINEWEBBER INCORPORATED
as Depositor and Sponsor
SEAL By
-------------------------------
Senior Vice President
Attest:
--------------------------
Secretary
STATE OF NEW YORK )
:ss.:
COUNTY OF NEW YORK )
On this 8th day of January, 1998 before me personally
appeared Xxxxxx X. Xxxxxx, to me known, who being by me duly sworn, said that
he is a Senior Vice President of PaineWebber Incorporated, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
-------------------------------
Notary Public
SCHEDULE A TO TRUST INDENTURE
THE PAINEWEBBER EQUITY TRUST
GROWTH STOCK SERIES 21
SCHEDULE OF INVESTMENTS
AS OF INITIAL DATE OF DEPOSIT, JANUARY 8, 1998
COMMON STOCKS (1)
PRIMARY INDUSTRY SOURCE AND NUMBER OF COST OF SECURITIES
NAME OF ISSUER SHARES TO TRUST(2)
-------------------------------------- ----------- ------------------
Appliances (1.42%)
Sunbeam Corporation................... 340 $13,685.00
Applications Software (4.28%)
Clarify, Inc.*........................ 1,050 13,781.25
PeopleSoft, Inc.*..................... 400 13,650.00
The Vantive Corporation*.............. 490 13,781.25
Auto/Truck Parts & Equipment (5.00%)
Xxxxx Industries, Inc................. 420 13,728.75
Excel Industries, Inc................. 750 13,781.25
The Standard Products Company......... 510 13,865.63
Walbro Corporation.................... 490 6,737.50
Cellular Communications (4.32%)
360 Communications Company*........... 740 14,013.75
Nextel Communications, Inc.*.......... 540 13,736.25
PriCellular Corporation*.............. 1,260 13,781.25
Computers (5.70%)
Cabletron Systems, Inc.*.............. 920 13,742.50
Data General Corporation*............. 730 13,687.50
Digital Equipment Corporation* ....... 350 13,628.13
Stratus Computer, Inc.*............... 360 13,837.50
Containers (2.85%)
Xxxxx Company, Inc.................... 320 13,700.00
Shorewood Packaging Corporation* ..... 540 13,770.00
Data Processing/Management (1.43%)
Baan Company, N.V.*................... 390 13,796.25
Direct Marketing(1.42%)
Catalina Marketing Corporation* ...... 310 13,659.38
Drug Delivery Systems (1.43%)
Alkermes, Inc.*....................... 650 13,731.25
Electric (4.31%)
Idaho Power Company................... 380 13,798.75
New York State Electric & Gas Corp. .. 410 13,837.50
NIPSCO Industries, Inc................ 280 13,860.00
Electronics (4.98%)
Credence Systems Corporation*......... 520 13,650.00
Etec Systems, Inc. *.................. 320 13,840.00
Genus, Inc.*.......................... 1,750 6,671.88
LTX Corporation*...................... 2,820 13,747.50
THE PAINEWEBBER EQUITY TRUST
GROWTH STOCK SERIES 21
SCHEDULE OF INVESTMENTS
AS OF INITIAL DATE OF DEPOSIT, JANUARY 8, 1998 (CONTINUED)
COMMON STOCKS (1)
PRIMARY INDUSTRY SOURCE AND NUMBER OF COST OF SECURITIES
NAME OF ISSUER SHARES TO TRUST(2)
-------------------------------------- ----------- ------------------
Finance (12.92%)
Beneficial Corporation................ 170 $13,833.75
First Chicago NBD Corporation......... 180 14,152.50
Fleet Financial Group, Inc............ 190 13,858.13
H.F. Ahmanson & Company............... 240 13,845.00
Golden State Bancorp, Inc.*........... 400 13,600.00
Mellon Bank Corporation............... 230 13,800.00
The Money Store, Inc.................. 710 13,756.25
Southtrust Corporation................ 230 13,785.60
State Street Corporation.............. 250 13,718.75
Food (2.85%)
Dominick's Supermarkets, Inc.* ....... 400 13,850.00
Hannaford Brothers Company............ 320 13,620.00
Gas Distribution(4.25%)
Consolidated Natural Gas Company ..... 240 13,485.00
MCN Corporation....................... 370 13,875.00
Sonat, Inc............................ 310 13,543.13
Internet Software (1.31%)
America Online, Inc*.................. 140 12,582.50
Machinery (2.87%)
Harnischfeger Industries, Inc. ....... 370 13,851.88
New Holland N.V....................... 540 13,770.00
Medical (11.49%)
CardioThoracic Systems, Inc.*......... 1,140 6,697.50
Eclipse Surgical Technologies, Inc.* . 1,040 6,695.00
Genzyme Transgenics Corporation* ..... 1,310 13,755.00
Heartport, Inc.*...................... 580 13,775.00
Schering-Plough Corporation........... 220 14,025.00
Sofamor Xxxxx Group, Inc.*............ 210 13,741.85
St. Jude Medical, Inc.*............... 440 13,915.00
Texas Biotechnology Corporation* ..... 2,340 13,747.50
Xxxxxx-Xxxxxxx Company................ 110 14,231.25
Manufacturing (1.43%)
Samsonite Corporation*................ 400 13,775.00
Networking Products (5.71%)
Ascend Communications, Inc.*.......... 500 13,781.25
Bay Networks, Inc.*................... 490 13,750.63
FORE Systems, Inc.*................... 810 13,770.00
Xylan Corporation*.................... 830 13,695.00
THE PAINEWEBBER EQUITY TRUST
GROWTH STOCK SERIES 21
SCHEDULE OF INVESTMENTS
AS OF INITIAL DATE OF DEPOSIT, JANUARY 8, 1998 (CONTINUED)
COMMON STOCKS (1)
PRIMARY INDUSTRY SOURCE AND NUMBER OF COST OF SECURITIES
NAME OF ISSUER SHARES TO TRUST(2)
-------------------------------------- ----------- ------------------
Oil (5.72%)
Nuevo Energy Company*................. 370 $ 13,666.88
Sante Fe Energy Resources, Inc.* ..... 1,460 13,778.75
Unocal Corporation.................... 370 13,782.50
Western Atlas, Inc.*.................. 200 13,775.00
Publishing (2.84%)
Xxxxxx-Xxxxxx, Inc.................... 250 13,562.50
The Reader's Digest Association,
Inc................................... 580 13,738.75
Seismic Data Collection (1.41%)
Veritas DGC, Inc.*.................... 410 13,606.88
Soap & Cleaning Preparation (2.88%)
Church & Xxxxxx Co., Inc.............. 480 13,830.00
The Clorox Company.................... 180 13,916.25
Telecommunications (7.18%)
AirTouch Communications, Inc.* ....... 330 13,695.00
Century Telephone Enterprises, Inc. . 270 13,837.50
GTE Corporation....................... 270 13,736.25
Teleport Communications Group, Inc.* . 240 13,860.00
U.S. West Communications Group ....... 300 13,931.25
------------------
TOTAL INVESTMENTS.................... $962,500.00
==================
------------
(1) All Securities are represented entirely by contracts to purchase
Securities.
(2) Valuation of the Securities by the Trustee was made as described in
"Valuation" as of the close of business on the business day prior to
the Initial Date of Deposit.
(3) The loss to the Sponsor on the date of deposit is $384.
* Non-income producing security.
