EXHIBIT 99.1.1
EQUITY SECURITIES TRUST,
SERIES 22, HIGH YIELD SYMPHONY SERIES
REFERENCE TRUST AGREEMENT
This Reference Trust Agreement (the "Agreement") dated March 11, 1999
between Xxxxx & Xxxx Distributors, Inc., 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 "Equity Securities Trust,
Series 6, Signature Series, Gabelli Entertainment and Media Trust, and
Subsequent Series, Trust Indenture and Agreement" dated November 16, 1995 and as
amended in part by this Agreement (collectively, such documents hereinafter
called the "Indenture and Agreement"). This Agreement and the Indenture, as
incorporated by reference herein, will constitute a single instrument.
WITNESSETH THAT:
WHEREAS, this Agreement is a Reference Trust Agreement as defined in
Section 1.1 of the Indenture, and shall be amended and modified from time to
time by an Addendum as defined in Section 1.1 (1) of the Indenture, such
Addendum setting forth any Additional Securities as defined in Section 1.1 (2)
of the Indenture;
WHEREAS, the Depositor wishes to deposit Securities, and any
Additional Securities as listed on any Addendums hereto, into the Trust and
issue Units, and Additional Units as the case maybe, in respect thereof pursuant
to Sections 2.1 and 2.6 of the Indenture; and
NOW THEREFORE, 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
Section 1. Subject to the provisions of Part II hereof, all the
provisions contained in the Indenture 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 following sections of the Indenture hereby are
amended as follows:
(a) All references to "The Chase Manhattan Bank (National
Association)" are replaced with "The Chase Manhattan Bank".
(b) Notwithstanding any provision of the Indenture to the contrary,
ownership of Units of this series of Equity Securities Trust shall not be
certificated and shall be evidenced solely by registration on the transfer books
of the Trustee, and the registered holder of uncertificated Units shall have all
of the rights and obligations (excluding the right to the issuance of a
Certificate) specified for a registered Certificateholder under the Indenture.
The Depositor and the Trustee shall cause all Units of the Trust issued to the
Depositor (upon both the initial deposit and any deposits of Additional
Securities pursuant to Section 2.6) to be deposited at The Depository Trust
Company ("DTC") and to be credited there to the account of the Depositor. On
and after such deposit, for all purposes under the Indenture and Agreement, the
sole registered holder of Units of the Trust shall be DTC, or its nominee,
unless and until DTC has notified the Trustee and the Depositor that it is no
longer willing to act as depository with respect to the Units. Accordingly, so
long as DTC, or its nominee, is the registered owner of the Trust Units,
beneficial ownership of Units may only be maintained by or through a participant
in DTC and shall be subject to the rules and operating procedures of DTC as in
effect from time to time. The Trustee shall not be liable for any loss or
liability resulting from the actions of DTC as registered holder and depository
of the Units.
(c) Sections 1.2 and 2.4 and any reference herein to the issuance of
Certificates shall be deleted.
(d) Section 2.3 shall be amended by adding after the words "has
registered on the registration books of the Trust the ownership by" the words
"the Depositor of such Units or, if requested by the Depositor, the ownership
by."
(e) Paragraph (a) of Section 2.6 shall be amended to read in its
entirety as follows:
"Section 2.6 Deposit of Additional Securities. (a) Subject to
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the requirements set forth below in this Section, the Depositor
may, on any Business Day (the "Trade Date"), subscribe for
Additional Units as follows:
(1) Prior to the Evaluation Time on the Trade Date, the
Depositor shall provide notice (the "Subscription Notice") to the
Trustee, by telecopy or by written communication, of the
Depositor's intention to subscribe for Additional Units. The
Subscription Notice shall identify the Additional Securities to
be acquired (unless such Additional Securities are a precise
replication of the then existing portfolio) and shall either (i)
specify the quantity of Additional Securities to be deposited by
the Depositor on the settlement date for such subscription or
(ii) instruct the Trustee to purchase Additional Securities with
an aggregate value as specified in the Subscription Notice.
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(2) Promptly following the Evaluation Time on such Business Day,
the Depositor shall verify with the Trustee, by telecopy, the
number of Additional Units to be created.
(3) Not later than the time on the settlement date for such
subscription when the Trustee is to deliver the Additional Units
created thereby (which time shall not be later than the time by
which the Trustee is required to settle any contracts for the
purchase of Additional Securities entered into by the Trustee
pursuant to the instruction of the Depositor referred to in
subparagraph (1) above), the Depositor shall deposit with the
Trustee (i) any Additional Securities specified in the
Subscription Notice (or contracts to purchase such Additional
Securities together with cash or a letter of credit in the amount
necessary to settle such contracts) or (ii) cash or a letter of
credit in the amount equal to the aggregate value of the
Additional Securities specified in the Subscription Notice,
together with, in each case, Cash as defined below. "Cash"
means, as to the Principal Account, cash or other property (other
than Securities) on hand in the Principal Account or receivable
and to be credited to the Principal Account as of the Evaluation
Time on the Business Day preceding the Trade Date (other than
amounts to be distributed solely to persons other than persons
receiving the distribution from the Principal Account as holders
of Additional Units created by the deposit), and, as to the
Income Account, cash or other property (other than Securities)
received by the Trust as of the Evaluation Time on the Business
Day preceding the Trade Date or receivable by the Trust in
respect of dividends or other distributions declared but not
received as of the Evaluation Time on the Business Day preceding
the Trade Date, reduced by the amount of any cash or other
property received or receivable on any Security allocable (in
accordance with the Trustee's calculation of the monthly
distribution from the Income Account pursuant to Section 3.5) to
a distribution made or to be made in respect of a Record Date
occurring prior to the Trade Date. Each deposit made during the
90 days following the deposit made pursuant to Section 2.1 hereof
shall replicate, to the extent practicable, as specified in
subparagraph (b), the Original Proportionate Relationship. Each
deposit made after the 90 days following the deposit made
pursuant to Section 2.1 hereof (except for deposits made to
replace Failed Securities if such deposits occur within 20 days
from the date of a failure occurring within such initial 90 day
period) shall maintain exactly the proportionate relationship
existing among the Securities as of the expiration of such 90 day
period. Each such deposit shall exactly replicate Cash.
(4) On the settlement date for a subscription, the Trustee
shall, in exchange for the Securities and cash or letter of
credit described above, issue and
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deliver to or on the order of the Depositor the number of Units
verified by the Depositor with the Trustee. No Unit to be issued
pursuant to this paragraph shall be issued or delivered unless
and until Securities, cash or a letter of credit is received in
exchange therefor and no person shall have any claim to any Unit
not so issued and delivered or any interest in the Trust in
respect thereof.
(5) Each deposit of Additional Securities, shall be listed in a
Supplementary Schedule to an Addendum to the Reference Trust
Agreement stating the date of such deposit and the number of
Additional Units being issued therefor. The Trustee shall
acknowledge in such Addendum the receipt of the Deposit and the
number of Additional Units issued in respect thereof. The
Additional Securities shall be held, administered and applied by
the Trustee in the same manner as herein provided for the
Securities.
(6) The acceptance of Additional Units by the Depositor in
accordance with the provisions of paragraph (a) of this Section
shall be deemed a certification by the Depositor that the deposit
or purchase of Additional Securities associated therewith
complies with the conditions of this Section 2.06.
(7) Notwithstanding the preceding, in the event that the
Sponsor's Subscription Notice shall instruct the Trustee to
purchase Additional Securities in an amount which, when added to
the purchase amount of all other unsettled contracts entered into
by the Trustee, exceeds 25% of the value of the Securities then
held (taking into account the value of contracts to purchase
Securities only to the extent that there has been deposited with
the Trustee cash or an irrevocable letter of credit in an amount
sufficient to settle their purchase), the Sponsor shall deposit
with the Trustee concurrently with the Subscription Notice such
that, when added to 25% of the value of the Securities then held
(determined as above) the aggregate value shall be not less than
the purchase amount of the securities to be purchased pursuant to
such Subscription Notice."
(f) Section 3.1 is hereby amended in its entirety to read as follows:
"Section 3.1. Initial Cost: The cost of the initial preparation,
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printing and execution of the Certificates and this Indenture, the
initial fees of the Trustee and its counsel, and the initial fees of
the Evaluator and other reasonable expenses in connection therewith,
shall be paid by the Depositor, provided, however, that the liability
on the part of the Depositor for such initial costs, fees and expenses
shall not include any fees, costs or other expenses incurred in
connection herewith after the execution of this Indenture and the
deposit referred to in Section 2.01.
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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 Depositor, or distribute to the Depositor
Securities having a value, as determined under Section 4.1 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 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 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."
(g) Section 3.5 is hereby amended by inserting the phrase "or Income"
in the second sentence of the sixth paragraph after the words "The Trustee shall
not be required to make a distribution from the Principal..."
(h) Section 3.11 is hereby amended so that the first sentence of such
section reads as follows:
" In the event that an offer by the issuer of any of the
Securities or any other party shall be made to issue new
Securities, the Trustee shall reject such offer, except that if
(1) the issuer failed to declare or pay anticipated dividends
with respect to such Securities or (2) in the opinion of the
Sponsor, given in writing to the Trustee, the issuer will
probably fail to declare or pay anticipated dividends with
respect to such Securities in the reasonably foreseeable future,
the Sponsor shall instruct the Trustee in writing to accept or
reject such offer and to take any other action with respect
thereto as the Sponsor may deem proper."
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(i) Section 3.14 is hereby amended by inserting the phrase "including,
but not limited to securities received as a result of a spin-off" in the first
sentence after the words "Any property received by the Trustee after the initial
date of Deposit in a form other than cash or additional shares of the Securities
listed on Schedule A..."
(j) Section 5.1 of the Agreement is amended by deleting clause (a)(4)
in the first paragraph and deleting clause (i) from the first sentence of the
second paragraph and renumbering the remaining clauses accordingly.
(k) Section 9.2 is hereby amended by replacing the phrase "60 business
days" with "7 days" in the first sentence of the sixth paragraph.
(l) Section 9.2 of the Agreement is further amended by adding the
following paragraph after the sixth paragraph of such Section 9.2:
"In the event that the Depositor directs the Trustee that certain
Securities will be sold to a new series of the Trust (a "New Series"),
the Depositor will certify to the Trustee, within five days of each
sale from a Trust to a New Series, (1) that the transaction is
consistent with the policy of both the Trust and the New Series, as
recited in their respective registration statements and reports filed
under the Act, (2) the date of such transaction and (3) the closing
sales price on the national securities exchange for the sale date of
the securities subject to such sale. The Trustee will then
countersign the certificate, unless the Trustee disagrees with the
closing sales price listed on the certificate, whereupon the Trustee
will promptly inform the Depositor orally of any such disagreement and
return the certificate within five days to the Depositor with
corrections duly noted. Upon the Depositor's receipt of a corrected
certificate, if the Depositor can verify the corrected price by
reference to an independently published list of closing sales prices
for the date of the transactions, the Depositor will ensure that the
price of Units of the New Series, and distributions to holders of the
Trust with regard to redemption of their Units or termination of the
Trust, accurately reflect the corrected price. To the extent that the
Depositor disagree with the Trustee's corrected price, the Depositor
and the Trustee will jointly determine the correct sales price by
reference to a mutually agreeable, independently published list of
closing sales prices for the date of the transaction. The Depositor
and Trustee will periodically review the procedures for sales and make
such changes as they deem necessary, consistent with Rule 17a-7(e)(2).
Finally, records of the procedures and of each transaction will be
maintained as provided in Rule 17a-7(f)."
(m) All references to "Xxxxx & Xxxx Distributors L.P.". are replaced
with "Xxxxx & Tang Distributors, Inc."
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Section 2. This Reference Trust Agreement may be amended and modified
by Addendums, attached hereto, evidencing the purchase of Additional Securities
which have been deposited to effect an increase over the number of Units
initially specified in Part II of this Reference Trust Agreement ("Additional
Closings"). The Depositor and Trustee hereby agree that their respective
representations, agreements and certifications contained in the Closing
Memorandum dated March 11, 1999, relating to the initial deposit of Securities
continue as if such representations, agreements and certifications were made on
the date of such Additional Closings and with respect to the deposits made
therewith, except as such representations, agreements and certifications relate
to their respective By-Laws and as to which they each represent that their has
been no amendment affecting their respective abilities to perform their
respective obligations under the Indenture.
Part II
SPECIAL TERMS AND CONDITIONS OF TRUST
Section 1. The following special terms and conditions are hereby
agreed to:
(a) The Securities (including Contract Securities) listed in the
Prospectus relating to this series of Equity Securities Trust (the "Prospectus")
have been deposited in the Trust under this Agreement (see "Portfolio" in Part A
of the Prospectus which for purposes of this Indenture and Agreement is the
Schedule of Securities or Schedule A).
(b) The number of Units delivered by the Trustee in exchange for the
Securities referred to in Section 2.3 is 15,646.
(c) For the purposes of the definition of Unit in item (22) of Section
1.1, the fractional undivided interest in and ownership of the Trust initially
is 1/15,646 of the date hereof.
(d) The term Record Date shall mean the fifteenth day of each month
commencing on April 15, 1999.
(e) The term Distribution Date shall mean the last business day of
each month commencing on April 30, 1999.
(f) The First Settlement Date shall mean March 16, 1999
(g) For purposes of Section 6.1(g), the liquidation amount is hereby
specified to be 40% of the aggregate value of the Securities at the completion
of the Deposit Period.
(h) For purposes of Section 6.4, the Trustee shall be paid per annum
an amount computed according to the following schedule, determined on the basis
of the number of Units outstanding as of the Record Date preceding the Record
Date on which the compensation is to be
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paid, provided, however, that with respect to the period prior to the first
Record Date, the Trustee's compensation shall be computed at $.86 per 100 Units:
rate per 100 units number of Units outstanding
$0.86 5,000,000 or less
$0.80 5,000,001 - 10,000,000
$0.74 10,000,001 - 20,000,000
$0.62 20,000,001 or more
(i) For purposes of Section 7.4, the Depositor's maximum annual
supervisory fee is hereby specified to be $.30 per 100 Units outstanding.
(j) The Mandatory Termination Date shall be March 11, 2006 or the
earlier disposition of the last Security in the Trust.
(k) The fiscal year for the Trust shall end on December 31 of each
year.
IN WITNESS WHEREOF, the parties hereto have caused this Reference
Trust Agreement to be duly executed on the date first above written.
[Signatures on separate pages]
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XXXXX & XXXX DISTRIBUTORS, INC.
Depositor
By: /s/ Xxxxx X. Xxxxxxx
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Executive Vice President
STATE OF NEW YORK )
: ss:
COUNTY OF NEW YORK )
On this 10th day of March, 1999, before me personally appeared Xxxxx
X. XxXxxxx, to me known, who being by me duly sworn, said that he is Executive
Vice President of the Depositor, one of the corporations described in and which
executed the foregoing instrument, and that he signed his name thereto by
authority of the Board of Directors of said corporation.
/s/ Xxxxxx Xxxxxxxx
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Notary Public
XXXXXX XXXXXXXX
NOTARY PUBLIC, State of New York
No. 00-0000000
Qualified in New York County
Term Expires 8-31-00
THE CHASE MANHATTAN BANK
Trustee
By: /s/ Xxxxxx X. Xxxxxxx
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Vice President
(SEAL)
STATE OF NEW YORK )
:ss.:
COUNTY OF NEW YORK )
On this 10th day of March, 1999, before me personally appeared
Xxxxxx X. Xxxxxxx, to me known, who being by me duly sworn, said that (s)he is
an Authorized Signator of The Chase Manhattan Bank, one of the corporations
described in and which executed the foregoing instrument; that (s)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 (s)he signed his/her name thereto by like authority.
/s/ Ada Xxxx Xxxx
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Notary Public
ADA XXXX XXXX
NOTARY PUBLIC, State of New York
No. 4864106
Qualified in New York County
Commission Expires 6-30-2000
