Exhibit 6
SERIES SUPPLEMENT
CORPORATE BACKED TRUST CERTIFICATES
XXXXXXX XXXXX CAPITAL I SECURITIES-BACKED SERIES 2004-7 TRUST
between
XXXXXX ABS CORPORATION,
as Depositor,
and
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee,
CORPORATE BACKED TRUST CERTIFICATES
Dated as of April 30, 2004
Table of Contents
Page
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Section 1. Incorporation of Standard Terms..................................1
Section 2. Definitions......................................................1
Section 3. Designation of Trust and Certificates............................8
Section 4. Trust Certificates..............................................12
Section 5. Distributions...................................................12
Section 6. Trustee's Fees..................................................17
Section 7. Optional Call; Optional Exchange................................17
Section 8. Notices of Events of Default....................................22
Section 9. Miscellaneous...................................................22
Section 10. Governing Law...................................................26
Section 11. Counterparts....................................................26
Section 12. Termination of the Trust........................................26
Section 13. Sale of Underlying Securities...................................26
Section 14. Amendments......................................................27
Section 15. Voting of Underlying Securities, Modification of Underlying
Securities Trust Agreement; Optional Exchange...................27
Section 16. Additional Depositor Representation.............................28
SCHEDULE I XXXXXXX XXXXX CAPITAL I SECURITIES-BACKED SERIES 2004-7
UNDERLYING SECURITIES SCHEDULE
SCHEDULE II CLASS A-2 AMORTIZATION SCHEDULE
EXHIBIT A-1 FORM OF TRUST CERTIFICATE CLASS A-1
EXHIBIT A-2 FORM OF TRUST CERTIFICATE CLASS A-2
EXHIBIT B FORM OF WARRANT AGENT AGREEMENT
EXHIBIT C FORM OF INVESTMENT LETTER
i
SERIES SUPPLEMENT
CORPORATE BACKED TRUST CERTIFICATES
XXXXXXX XXXXX CAPITAL I SECURITIES-BACKED SERIES 2004-7 TRUST
SERIES SUPPLEMENT, Xxxxxxx Xxxxx Capital I Securities-Backed
Series 2004-7, dated as of April 30, 2004 (the "Series Supplement"), by and
between XXXXXX ABS CORPORATION, as Depositor (the "Depositor"), and U.S. BANK
TRUST NATIONAL ASSOCIATION, as Trustee (the "Trustee").
W I T N E S S E T H:
WHEREAS, the Depositor desires to create the Trust designated
herein (the "Trust") by executing and delivering this Series Supplement, which
shall incorporate the terms of the Standard Terms for Trust Agreements, dated
as of January 16, 2001 (the "Standard Terms" and, together with this Series
Supplement, the "Trust Agreement"), by and between the Depositor and the
Trustee, as modified by this Series Supplement;
WHEREAS, the Depositor desires to deposit into the Trust the
Underlying Securities described on Schedule I attached hereto, the general
terms of which are described in the Prospectus Supplement under the heading
"Description of the Deposited Assets--Underlying Securities;"
WHEREAS, in connection with the creation of the Trust and the
deposit therein of the Underlying Securities, it is desired to provide for the
issuance of trust certificates evidencing undivided interests in the Trust and
call warrants related thereto; and
WHEREAS, the Trustee has joined in the execution of the Standard
Terms and this Series Supplement to evidence the acceptance by the Trustee of
the Trust.
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants expressed herein, it is hereby agreed by and between the
Depositor and the Trustee as follows:
Section 1. Incorporation of Standard Terms. Except as otherwise provided
herein, all of the provisions of the Standard Terms are hereby incorporated
herein by reference in their entirety, and this Series Supplement and the
Standard Terms shall form a single agreement between the parties. In the event
of any inconsistency between the provisions of this Series Supplement and the
provisions of the Standard Terms, the provisions of this Series Supplement
will control with respect to the Xxxxxxx Xxxxx Capital I Securities-Backed
Series 2004-7 Certificates and the transactions described herein.
Section 2. Definitions.
(a) Except as otherwise specified herein or as the context may otherwise
require, the following terms shall have the respective meanings set forth
below for all purposes under this Series Supplement. (Section 2(b) below sets
forth the terms listed in the Standard Terms that are
not applicable to this Series.) Capitalized terms used but not defined herein
shall have the meanings assigned to them in the Standard Terms.
"Accredited Investor" shall mean a Person that qualifies as an
"accredited investor" within the meaning of Rule 501(a) under the Securities
Act.
"Amortizing Notional Balance" shall have the meaning specified in
Section 3 hereof.
"Available Funds" shall have the meaning specified in the Standard
Terms.
"Calculation Agent" shall mean Xxxxxx ABS Corporation or such
affiliate thereof as shall be designated by Xxxxxx ABS Corporation.
"Call Date" shall mean any Business Day that any holder of Call
Warrants designates as a Call Date occurring (i) on or after April 30, 2009,
(ii) after the Underlying Securities Issuer announces that it will redeem,
prepay or otherwise make an unscheduled payment on the Underlying Securities,
(iii) after the Trustee notifies the Certificateholders of any proposed sale
of the Underlying Securities pursuant to the provisions of Section 5(e) or
5(i) of this Series Supplement or (iv) on any date on which the Underlying
Securities Issuer or an affiliate thereof consummates a tender offer for some
or all of the Underlying Securities.
"Call Notice" shall have the meaning specified in Section 1.1 of
the Warrant Agent Agreement.
"Call Price" shall mean, for each related Call Date, (i) in the
case of the Class A-1 Certificates, the sum of 100% of the outstanding
Certificate Principal Balance of the Class A-1 Certificates being purchased
pursuant to the exercise of the Call Warrants, plus any accrued and unpaid
interest on such amount to, but excluding, the Call Date and (ii) in the case
of the Class A-2 Certificates, the Amortizing Notional Balance of the Class
A-2 Certificates being purchased pursuant to the exercise of the Call
Warrants, plus any accrued and unpaid interest on such amount to, but
excluding, the Call Date.
"Call Warrants" shall have the meaning specified in Section 3
hereof.
"Called Certificates" shall have the meaning specified in Section
1.1(b) of the Warrant Agent Agreement.
"Certificate Principal Balance" shall have the meaning specified
in Section 3 hereof.
"Certificates" shall have the meaning specified in Section 3
hereof.
"Class A-1 Allocation" shall mean the sum of the present values
(discounted at the rate of 6.30% per annum) of (i) any unpaid interest due or
to become due on the Class A-1 Certificates and (ii) the outstanding
Certificate Principal Balance of the Class A-1 Certificates (assuming, in each
case, that the Class A-1 Certificates were paid when due and were not redeemed
or prepaid prior to their stated maturity).
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"Class A-1 Certificates" shall mean the Certificates, in the form
attached hereto as Exhibit A-1, to be issued by the Trust representing a
proportionate undivided beneficial ownership interest in certain distributions
to be made by the Trust and having the characteristics described herein and in
the Certificates.
"Class A-2 Allocation" shall mean the present value (discounted at
the rate of 6.30% per annum) of any unpaid amounts due or to become due on the
Class A-2 Certificates (assuming that the Class A-2 Certificates were paid
when due and were not redeemed or prepaid prior to their stated maturity).
"Class A-2 Amortization Schedule" shall mean the amortization
schedule attached hereto as Schedule II.
"Class A-2 Certificates" shall mean the Certificates, in the form
attached hereto as Exhibit A-2, to be issued by the Trust representing a
proportionate undivided beneficial ownership interest in certain distributions
to be made by the Trust and having the characteristics described herein and in
the Certificates.
"Class A-2 Notional Distribution Amount" shall mean, with respect
to any Distribution Date, the product of (x) the amount set forth on the Class
A-2 Amortization Schedule under the heading "Class A-2 Scheduled Notional
Amount" (as such amount may be adjusted from time to time in accordance with
Section 3(d) hereof) and (y) a fraction, the numerator of which will be equal
to the outstanding principal amount of Underlying Securities held by the Trust
on such Distribution Date and the denominator of which will equal the
aggregate principal amount of Underlying Securities deposited in the Trust on
the Closing Date and in connection with the deposit of additional Underlying
Securities in accordance with Section 3(d) hereof.
"Class A-2 Rate" shall have the meaning set forth in Section 3(c)
hereof.
"Closing Date" shall mean April 30, 2004.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collection Period" shall mean, (i) with respect to each August
Distribution Date, the period beginning on the day after the February
Distribution Date of such year and ending on such August Distribution Date,
inclusive and (ii) with respect to each February Distribution Date, the period
beginning on the day after the August Distribution Date of the prior year and
ending on such February Distribution Date, inclusive; provided, however, that
clauses (i) and (ii) shall be subject to Section 9(f) hereof.
"Corporate Trust Office" shall mean the office of U.S. Bank Trust
National Association located at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Currency" shall mean United States Dollars.
"Depository" shall mean The Depository Trust Company, its nominees
and their respective successors.
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"Distribution Date" shall mean February 15th and August 15th of
each year (or if such date is not a Business Day, the next succeeding Business
Day), commencing on August 15, 2004, and ending on the earlier of the Final
Scheduled Distribution Date and any date on which all Underlying Securities
are redeemed, prepaid or liquidated in whole for any reason other than at
their maturity.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended.
"Event of Default" shall mean (i) a default in the payment of any
interest on the Underlying Securities after the same becomes due and payable
(subject to any permitted deferral during an Extension Period and any other
applicable grace period), (ii) a default in the payment of the principal of or
any installment of principal of the Underlying Securities when the same
becomes due and payable and (iii) any other event specified as an "Event of
Default" in the Underlying Securities Trust Agreement.
"Exchange Act" shall mean the Securities and Exchange Act of 1934,
as amended, and the rules and regulations promulgated thereunder.
"Extension Period" shall mean a period not exceeding ten
consecutive semi-annual interest periods for which the Underlying Securities
Issuer may defer payment of interest on the Underlying Securities pursuant to
the provisions of the Underlying Securities Trust Agreement, which Extension
Period shall not extend beyond the maturity date of the Underlying Securities.
"Final Scheduled Distribution Date" shall mean the Distribution
Date in February 2034, or if such day is not a Business Day, the next
succeeding Business Day.
"Initial Amortizing Notional Balance" shall mean, in respect of
any Class A-2 Certificate (or the Class A-2 Certificates as a whole), the
Amortizing Notional Balance of such Class A-2 Certificate or Class of
Certificates issued on the Closing Date plus the Amortizing Notional Balance
of any Class A-2 Certificates issued in accordance with Section 3(d) hereof.
"Junior Subordinated Debenture Issuer" shall mean The Xxxxxxx
Xxxxx Group, Inc.
"Junior Subordinated Debentures" shall mean the 6.345% Junior
Subordinated Debentures issued by the Junior Subordinated Debenture Issuer.
"Liquidation Price" shall mean the price at which the Trustee
sells the Underlying Securities.
"Maturity Date" shall have the meaning specified in Schedule I
hereto.
"Moody's" shall mean Xxxxx'x Investors Service, Inc.
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"Optional Call" shall mean the call of the Certificates by the
Warrant Holder, in whole or in part, resulting from the exercise of Call
Warrants by the Warrant Holder, pursuant to Section 7(d) hereof.
"Optional Exchange" shall mean the exchange of the Certificates by
the Trust for the Underlying Securities pursuant to Section 7(a) hereof.
"Optional Exchange Date" shall mean any date on which Underlying
Securities subject to Optional Exchange are distributed to a
Certificateholder.
"Ordinary Expenses" shall mean the Trustee's ordinary expenses and
overhead in connection with its services as Trustee, including the items
referred to in the definition of Ordinary Expenses in the Standard Terms.
"Plan" means (a) an employee benefit plan (as defined in Section
3(3) of ERISA), (b) a plan described in Section 4975(e)(1) of the Code or (c)
any entity whose underlying assets are treated as assets of any such plan by
reason of such plan's investment in the entity.
"Prepaid Ordinary Expenses" shall be zero for this Series.
"Prospectus Supplement" shall mean the Prospectus Supplement,
dated April 21, 2004, and a supplement thereto, dated April 28, 2004, relating
to the Class A-1 Certificates.
"QIB" shall have the meaning set forth in Section 3(e) hereof.
"Rating Agencies" shall mean Moody's and S&P.
"Record Date" shall mean, with respect to each Distribution Date,
the day immediately preceding the related Distribution Date.
"Required Percentage--Amendment" shall be 66-2/3% of the aggregate
Voting Rights, unless the subject amendment requires the vote of holders of
only one class of Certificates pursuant to the Standard Terms, in which case
66-2/3% of the Voting Rights of such Class.
"Required Percentage--Direction of Trustee" shall be 66-2/3% of
the aggregate Voting Rights.
"Required Percentage--Remedies" shall be 66-2/3% of the aggregate
Voting Rights.
"Required Percentage--Removal" shall be 66-2/3% of the aggregate
Voting Rights.
"Required Rating" shall mean, in the case of Moody's, the rating
assigned to the Underlying Securities by Moody's as of the Closing Date, and,
in the case of S&P, the rating assigned to the Underlying Securities by S&P as
of the Closing Date.
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"Resale Restriction Termination Date" shall have the meaning set
forth in Section 3(e) hereof.
"Rule 144A" shall have the meaning set forth in Section 3(e)
hereof.
"S&P" shall mean Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies, Inc.
"SEC Reporting Failure" shall mean the date determined by the
Depositor within a reasonable time following the Junior Subordinated Debenture
Issuer's either (x) having stated in writing that it intends permanently to
cease filing periodic reports required under the Exchange Act or (y) having
failed to file all required periodic reports for one full year.
"Securities Act" shall mean the United States Securities Act of
1933, as amended.
"Securities Intermediary" shall mean initially, U.S. Bank Trust
National Association.
"Series" shall mean Xxxxxxx Xxxxx Capital I Securities-Backed
Series 2004-7.
"Special Distribution Date" shall have the meaning specified in
Section 5 hereof.
"Trustee Fee" shall mean the amount paid to the Trustee by the
Depositor on the Closing Date.
"Trust Property" shall mean the Underlying Securities described on
Schedule I hereto, the Certificate Account and any additional Underlying
Securities sold to the Trust pursuant to Section 3(d) hereof.
"UCC" shall mean the Uniform Commercial Code as in effect in the
applicable jurisdiction.
"Underlying Securities" shall mean $30,000,000 aggregate principal
amount of 6.345% Capital Securities, issued by the Underlying Securities
Issuer, as set forth in Schedule I attached hereto (subject to Section 3(d)
hereof). In the event that the Debenture Issuer liquidates the Underlying
Securities Issuer, all references to "Underlying Securities" shall refer to
the Junior Subordinated Debentures held by the Trust subsequent to such
liquidation.
"Underlying Securities Issuer" shall mean Xxxxxxx Xxxxx Capital I.
"Underlying Securities Trustees" shall mean, with respect to the
Underlying Securities, collectively, The Bank of New York, as Delaware
trustee, The Bank of New York, as property trustee, and the three individual
administrative trustees.
"Underlying Securities Trust Agreement" shall mean the amended and
restated trust agreement between the Junior Subordinated Debenture Issuer, as
depositor, and The Bank of New York, as trustee, pursuant to which the
Underlying Securities were issued.
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"Underwriter" shall mean Xxxxxx Brothers Inc.
"Voting Rights" shall be allocated between the holders of the
Class A-1 Certificates and the holders of the Class A-2 Certificates, pro
rata, in proportion to the ratio of the Class A-1 Allocation to the Class A-2
Allocation as of any applicable Record Date. The Class A-1 Voting Rights will
be allocated among all of the Class A-1 Certificateholders in proportion to
the respective Certificate Principal Balances of their respective Certificates
and the Class A-2 Voting Rights will be allocated among Class A-2
Certificateholders in proportion to the Initial Amortizing Notional Balances
of their respective Certificates.
"Warrant Agent" shall mean initially, U.S. Bank Trust National
Association.
"Warrant Agent Agreement" shall mean that certain Warrant Agent
Agreement, dated as of the date hereof, between the Depositor and U.S. Bank
Trust National Association, as Warrant Agent and as Trustee, as the same may
be amended from time to time.
"Warrant Holder" shall mean the holder of a Call Warrant.
(b) The terms listed below are not applicable to this Series.
"Accounting Date"
"Administrative Fees"
"Advance"
"Allowable Expense Amounts"
"Basic Documents"
"Call Premium Percentage"
"Credit Support"
"Credit Support Instrument"
"Credit Support Provider"
"Cut-off Date"
"Eligible Expense"
"Eligible Investments"
"Exchange Rate Agent"
"Fixed Pass-Through Rate"
"Floating Pass-Through Rate"
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"Guaranteed Investment Contract"
"Letter of Credit"
"Limited Guarantor"
"Limited Guaranty"
"Minimum Wire Denomination"
"Pass-Through Rate"
"Place of Distribution"
"Purchase Price"
"Required Premium"
"Required Principal"
"Requisite Reserve Amount"
"Retained Interest"
"Sale Procedures"
"Sub-Administration Account"
"Sub-Administration Agreement"
"Sub-Administration Agent"
"Surety Bond"
"Swap Agreement"
"Swap Counterparty"
"Swap Distribution Amount"
"Swap Guarantee"
"Swap Guarantor"
"Swap Receipt Amount"
"Swap Termination Payment"
Section 3. Designation of Trust and Certificates. The Trust created
hereby shall be known as the "Corporate Backed Trust Certificates, Xxxxxxx
Xxxxx Capital I Securities-Backed
8
Series 2004-7 Trust." The Certificates evidencing certain undivided ownership
interests therein shall be known as "Corporate Backed Trust Certificates,
Xxxxxxx Xxxxx Capital I Securities-Backed Series 2004-7." The Certificates
shall consist of the Class A-1 Certificates and the Class A-2 Certificates
(together, the "Certificates"). The Trust is also issuing call warrants with
respect to the Certificates ("Call Warrants").
(a) The Class A-1 Certificates shall be held through the Depository in
book-entry form and shall be substantially in the form attached hereto as
Exhibit A-1. The Class A-2 Certificates shall initially be held through the
Depository in book-entry form and, as set forth in Section 3(e) below, shall
be held subsequent to the Closing Date in physical form or through the
Depository in book-entry form and shall be substantially in the form attached
hereto as Exhibit A-2. The Class A-1 Certificates shall be issued in
denominations of $25. The Class A-2 Certificates shall be issued in minimum
denominations of $1,000 and integral multiples of $1,000 in excess thereof;
provided, however, that the Class A-2 Certificates may only be purchased, held
or transferred in an aggregate Initial Amortizing Notional Balance equal to or
greater than $40,000; provided, further, that on any Call Date on which a
Warrant Holder shall concurrently exchange Class A-2 Called Certificates for a
distribution of Underlying Securities in accordance with the provisions of
Section 7 hereof, Class A-2 Called Certificates may be issued in other
denominations. Except as provided in the Standard Terms and in paragraph (d)
in this Section, the Trust shall not issue additional Certificates or
additional Call Warrants or incur any indebtedness.
(b) The Class A-1 Certificates shall consist initially of 1,200,000
Certificates having an initial aggregate certificate principal balance (the
"Certificate Principal Balance") of $30,000,000. The Class A-2 Certificates
shall have an initial aggregate amortizing notional balance (the "Amortizing
Notional Balance") of $162,000.
(c) The holders of the Class A-1 Certificates will be entitled to
receive on each Distribution Date the interest, if any, received on the
Underlying Securities, to the extent necessary to pay interest at 6.30% per
annum on the outstanding Class A-1 Certificate Principal Balance of the Class
A-1 Certificates. The holders of the Class A-2 Certificates will be entitled
to receive on each Distribution Date the interest, if any, received on the
Underlying Securities, to the extent necessary to pay (x) interest at a rate
of 7.40 % per annum (the "Class A-2 Rate") on the outstanding Amortizing
Notional Balance of the Class A-2 Certificates and (y) the Class A-2 Notional
Distribution Amount for the related Distribution Date. On the Distribution
Date occurring in August 2004, the Trustee shall cause the Trust to pay to the
Depositor the amount of interest accrued and paid on the Underlying Securities
from February 20, 2004, to but not including the Closing Date; provided,
however, that a portion of such accrued interest, in an amount not to exceed
$520, will be applied towards any shortfall in the amount distributable
pursuant to Section 5(a)(i)(2) on the Distribution Date occurring in August
2004; provided, further, that in the event an Optional Exchange Date shall
occur prior to the Distribution Date in August 2004, a pro rata portion of
such amount due to the Depositor shall be paid to the Depositor on the
Optional Exchange Date in accordance with the provisions of Section 7(b)(ix)
hereof. If the Depositor is not paid any such amount on such date, it shall
have a claim for such amount. If Available Funds are insufficient to pay such
amount, the Trustee will pay the Depositor its pro rata share, based on the
ratio the amount owed to the Depositor bears to all
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amounts owed on the Certificates in respect of accrued interest, of any
proceeds from the recovery on the Underlying Securities.
(d) The Depositor may sell to the Trustee additional Underlying
Securities on any date hereafter upon at least 3 Business Days' notice to the
Trustee (or such shorter period as shall be mutually satisfactory to the
Depositor and the Trustee) and upon (i) satisfaction of the Rating Agency
Condition and (ii) delivery of an Opinion of Counsel to the effect that the
sale of such additional Underlying Securities will not cause the Trust to be
taxed as an association or publicly traded partnership taxable as a
corporation for federal income tax purposes. Each condition to be satisfied
with respect to a sale of Underlying Securities on or prior to the Closing
Date shall be satisfied with respect to a sale of additional Underlying
Securities no later than the date of sale thereof, each representation and
warranty set forth in the Standard Terms to be made on the Closing Date shall
be made on such date of sale, and from and after such date of sale, all
Underlying Securities held by the Trustee shall be held on the same terms and
conditions. Upon such sale to the Trustee, the Trustee shall deposit such
additional Underlying Securities in the Certificate Account, and shall
authenticate and deliver to the Depositor, on its order, (i) Class A-1
Certificates in a Certificate Principal Balance equal to the principal amount
of such additional Underlying Securities, (ii) Class A-2 Certificates having
an aggregate Amortizing Notional Balance in the same proportion to the
additional Class A-1 Certificates as exists with respect to the initial
aggregate Certificate Principal Balance of the Class A-1 Certificates and the
initial aggregate Amortizing Notional Balance of the Class A-2 Certificates
and (iii) Call Warrants related to such additional Class A-1 Certificates and
Class A-2 Certificates. Any such additional Class A-1 Certificates and Class
A-2 Certificates authenticated and delivered shall have the same terms and
rank pari passu with the corresponding classes of Certificates previously
issued in accordance with this Series Supplement. Upon the deposit of
additional Underlying Securities in the Trust, the Calculation Agent shall
revise and amend the Class A-2 Amortization Schedule in a manner that
maintains the intended yield on the Class A-2 Certificates.
(e) No Class A-2 Certificate may be offered, resold, assigned or
otherwise transferred (including by pledge or hypothecation) at any time prior
to (x) the date which is two years, or such shorter period of time as
permitted by Rule 144(k) under the Securities Act, after the later of the
original issue date of such Class A-2 Certificates and the last date on which
the Depositor or any "affiliate" (as defined in Rule 144 under the Securities
Act) of the Depositor was the owner of such Class A-2 Certificates (or any
predecessor thereto) or (y) such later date, if any, as may be required by a
change in applicable securities laws (the "Resale Restriction Termination
Date") unless such offer, resale, assignment or transfer is (i) to the Trust,
(ii) pursuant to an effective registration statement under the Securities Act,
(iii) to a qualified institutional buyer (a "QIB"), as such term is defined in
Rule 144A promulgated under the Securities Act ("Rule 144A"), in accordance
with Rule 144A or (iv) pursuant to another available exemption from
registration provided under the Securities Act (including transfers to
Accredited Investors), and, in each of cases (i) through (iv), in accordance
with any applicable securities laws of any state of the United States and
other jurisdictions. Prior to any offer, resale, assignment or transfer of any
Class A-2 Certificates in the manner described in clause (iii) above, the
prospective transferee and the prospective transferor shall be required to
deliver to the Trustee an executed copy of an Investment Letter with respect
to the Class A-2 Certificates to be transferred substantially in the form of
Exhibit C hereto and in the event the resale, assignment or transfer shall
involve Class A-2 Certificates then being held in physical form, such A-2
Certificates shall be delivered to the
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Trustee for cancellation and the Trustee shall instruct the Depository to
increase the aggregate Amortizing Notional Balance of the Class A-2
Certificates held in book-entry form by an amount equal to the aggregate
Amortizing Notional Balance of Class A-2 Certificates so resold, assigned or
transferred and to issue a beneficial interest in such global Class A-2
Certificates to such transferee. Prior to any offer, resale, assignment or
transfer of any Class A-2 Certificates in the manner described in clause (iv)
above, the prospective transferee and the prospective transferor shall be
required to deliver to the Trustee documentation certifying that the offer,
resale, assignment or transfer complies with the provisions of said clause
(iv) and, in the event any such Class A-2 Certificate shall then be held in
book-entry form and such resale, assignment or transfer shall be to an
Accredited Investor that is not a QIB, the Trustee shall instruct the
Depository to decrease the aggregate Amortizing Notional Balance of the Class
A-2 Certificates held in book-entry form and the Trustee shall authenticate
and deliver one or more Class A-2 Certificates in physical form in an
aggregate Amortizing Notional Balance equal to the amount of Class A-2
Certificates resold, assigned or transferred. In addition to the foregoing,
each prospective transferee of any Class A-2 Certificates in the manner
contemplated by clause (iii) above shall acknowledge, represent and agree as
follows:
(1) The transferee (x) is a QIB, (y) is aware that the sale to
it is being made in reliance on Rule 144A and (z) is
acquiring such Class A-2 Certificates for its own account or
for the account of a QIB.
(2) The transferee understands that the Class A-2 Certificates
are being offered in a transaction not involving any public
offering in the United States within the meaning of the
Securities Act, and that the Class A-2 Certificates have not
been and will not be registered under the Securities Act.
(3) The transferee agrees that (A) if in the future it decides
to offer, resell, pledge or otherwise transfer the Class A-2
Certificates prior to the Resale Restriction Termination
Date, such Class A-2 Certificates shall only be offered,
resold, assigned or otherwise transferred (i) to the Trust,
(ii) pursuant to an effective registration statement under
the Securities Act, (iii) to a QIB, in accordance with Rule
144A or (iv) pursuant to another available exemption from
registration provided under the Securities Act (including
any transfer to an Accredited Investor), and, in each of
cases (i) through (iv), in accordance with any applicable
securities laws of any state of the United States and other
jurisdictions and (B) the transferee will, and each
subsequent holder is required to, notify any subsequent
purchaser of such Class A-2 Certificates from it of the
resale restrictions referred to in clause (A) above.
(f) The Class A-2 Certificates will, unless otherwise agreed by the
Depositor and the Trustee, bear a legend substantially to the following
effect:
"THIS CLASS A-2 CERTIFICATE (OR ITS PREDECESSOR) HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY
NOT BE
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TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A
REGISTRATION UNDER SUCH ACT IS IN EFFECT OR PURSUANT TO AN
EXEMPTION THEREFROM UNDER SUCH ACT. THE CLASS A-2 CERTIFICATE
REPRESENTED HEREBY MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE
TERMS OF THE SERIES SUPPLEMENT.
EACH PURCHASER OF THIS CLASS A-2 CERTIFICATE IS HEREBY NOTIFIED
THAT THE SELLER OF THIS CLASS A-2 CERTIFICATE MAY BE RELYING ON
THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES
ACT PROVIDED BY RULE 144A THEREUNDER."
Section 4. Trust Certificates. The Trustee hereby acknowledges receipt,
on or prior to the Closing Date, of:
(a) the Underlying Securities set forth on Schedule I hereto; and
(b) all documents required to be delivered to the Trustee pursuant to
Section 2.01 of the Standard Terms.
Section 5. Distributions.
(a) Except as otherwise provided in Sections 3(c), 5(c), 5(d) and 5(i),
on each applicable Distribution Date (or such later date as specified in
Section 9(f)), the Trustee shall apply Available Funds in the Certificate
Account as follows:
(i) The Trustee will pay the interest portion of Available Funds:
(1) first, to the Trustee, as reimbursement for any
remaining Extraordinary Trust Expenses incurred by the Trustee in
accordance with Section 6(b) below and approved by 100% of the
Certificateholders; and
(2) second, to the holders of the Class A-1 Certificates,
accrued and unpaid interest at 6.30% per annum, and to the holders
of the Class A-2 Certificates, (x) accrued and unpaid interest at
the Class A-2 Rate and (y) any unpaid Class A-2 Notional
Distribution Amount for the related, and any prior, Distribution
Date, pro rata in proportion to their entitlements thereto.
(ii) the Trustee will pay the principal portion of Available
Funds:
(1) first, to the Trustee, as reimbursement for any
remaining Extraordinary Trust Expenses incurred by the Trustee in
accordance with Section 6(b) below and approved by 100% of the
Certificateholders; and
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(2) second, to the holders of the Class A-1 Certificates, an
amount equal to the Certificate Principal Balance of the Class A-1
Certificates (the Class A-2 Certificates are not entitled to
distributions from the principal portion of Available Funds).
(iii) any Available Funds remaining in the Certificate Account
after the payments set forth in clauses 5(a)(i) and 5(a)(ii) above shall
be paid to the Trustee as reasonable compensation for services rendered
to the Depositor, up to $1,000.
(iv) the Trustee will pay any Available Funds remaining in the
Certificate Account after the distributions in clauses 5(a)(i) through
5(a)(iii) above to the holders of the Class A-1 Certificates and Class
A-2 Certificates pro rata in proportion to the interest rate on each
such class of Certificates.
Any portion of the Available Funds (i) that does not constitute principal of,
or interest on, the Underlying Securities, (ii) that is not received in
connection with a tender offer, redemption, prepayment or liquidation of the
Underlying Securities and (iii) for which allocation by the Trustee is not
otherwise contemplated by this Series Supplement, shall be remitted by the
Trustee to the holders of the Class A-1 Certificates and the holders of the
Class A-2 Certificates in accordance with the ratio of the Class A-1
Allocation to the Class A-2 Allocation.
(b) Interest shall continue to accrue on the Certificates during the
pendency of any Extension Period. Such interest shall be distributed to
Certificateholders, to the extent received by the Trustee, upon the completion
of the related Extension Period in accordance with the provisions of Section
5(a) hereof.
(c) Notwithstanding the foregoing, if the Underlying Securities are
redeemed (including as a result of an optional redemption), prepaid or
liquidated in whole or in part for any reason other than due to the occurrence
of an Event of Default, an SEC Reporting Failure, or their maturity, the
Trustee shall apply Available Funds in the manner described in Section 5(h) in
the following order of priority:
(i) first, to the Trustee, as reimbursement for any
Extraordinary Trust Expenses incurred by the Trustee in
accordance with Section 6(b) below and approved by 100% of
the Certificateholders;
(ii) second, to the holders of the Class A-1 Certificates, an
amount equal to the principal amount of Underlying
Securities so redeemed, prepaid or liquidated plus accrued
and unpaid interest on the amount of Class A-1 Certificates
redeemed in connection with such principal payment;
(iii) third, to the holders of the Class A-2 Certificates, an
amount not to exceed the Amortizing Notional Balance plus
accrued interest thereon of the Class A-2 Certificates;
(iv) fourth, to the Trustee, as reasonable compensation for
services rendered to the Depositor, any remainder up to
$1,000; and
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(v) fifth, any remainder to the holders of the Class A-1
Certificates and the Class A-2 Certificates pro rata in
proportion to the ratio of the Class A-1 Allocation to the
Class A-2 Allocation.
(d) Notwithstanding the foregoing, if the Underlying Securities are
redeemed, prepaid or liquidated in whole or in part due to the occurrence of
an Event of Default, the Trustee shall distribute Available Funds to the
holders of the Class A-1 Certificates and the holders of the Class A-2
Certificates in accordance with the ratio of the Class A-1 Allocation to the
Class A-2 Allocation.
(e) Unless otherwise instructed by holders of Certificates representing
a majority of the Voting Rights, thirty (30) days after giving notice pursuant
to Section 8 hereof, the Trustee shall sell the Underlying Securities pursuant
to Section 13 hereof and deposit the Liquidation Proceeds, if any, into the
Certificate Account for distribution not later than two (2) Business Days
after the receipt of immediately available funds in accordance with Section
5(d) hereof, provided, however, that if any Warrant Holder designates any day
on or prior to the proposed sale date as a Call Date and Optional Exchange
Date pursuant to Section 7, the portion of Underlying Securities related to
such Optional Exchange shall not be sold but shall be distributed to the
Warrant Holder pursuant to Section 7 and the Warrant Agent Agreement.
(f) If the Trustee receives non-cash property in respect of the
Underlying Securities as a result of a payment default on the Underlying
Securities (including from the sale thereof), the Trustee will promptly give
notice to the Depository, or for any Certificates which are not then held by
DTC or any other depository, directly to the registered holders of the
Certificates then outstanding and unpaid and to the Warrant Agent. Such notice
shall state that the Trustee shall, and the Trustee shall, not later than 30
days after the receipt of such property, allocate and distribute such property
to the holders of Class A-1 Certificates and Class A-2 Certificates then
outstanding and unpaid (after deducting the costs incurred in connection
therewith) in accordance with Section 5(d) hereof. Property other than cash
will be liquidated by the Trustee, and the proceeds thereof distributed in
cash, only to the extent necessary to avoid distribution of fractional
securities to Certificateholders. In-kind distribution of such property to
Certificateholders, based on the market value of such property as of the date
of distribution to Certificateholders, will be deemed to reduce the
Certificate Principal Balance or Amortizing Notional Balance, as applicable,
of the Certificates as follows: (x) the Certificate Principal Balance of the
Class A-1 Certificates will be reduced on a dollar-for-dollar basis and (y)
the Amortizing Notional Balance of the Class A-2 Certificates shall be reduced
in proportion to the reduction in the principal amount of Underlying
Securities held by the Trust.
(g) Subject to Section 9(f) hereof, to the extent Available Funds are
insufficient to make any scheduled interest or principal payments on any class
of Certificates on any Distribution Date, any shortfall will be carried over
and will be distributed on the next Distribution Date (or date referred to in
Section 5(h) hereof) on which sufficient funds are available to pay such
shortfall.
(h) If a payment with respect to the Underlying Securities is made to
the Trustee (x) after the payment date of the Underlying Securities on which
such payment was due or (y) in connection with redemption, prepayment or
liquidation, in whole or in part, of the Underlying
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Securities for any reason other than due to the occurrence of an Event of
Default, an SEC Reporting Failure or at their maturity, the Trustee will
distribute any such amounts received in accordance with the provisions of this
Section 5 on the next occurring Business Day (a "Special Distribution Date")
as if the funds had constituted Available Funds on the Distribution Date
immediately preceding such Special Distribution Date; provided, however, that
the Record Date for such Special Distribution Date shall be one Business Day
prior to the day on which the related payment was received with respect to the
Underlying Securities.
(i) Notwithstanding Section 3.12 of the Standard Terms, upon the
occurrence of an SEC Reporting Failure, the Depositor shall instruct the
Trustee within a reasonable time to (i) notify the Warrant Agent that the
Underlying Securities are proposed to be sold and that any Call Warrants and
related Optional Exchange rights must be exercised no later than the date
specified in the notice (which shall be not less than ten Business Days after
the date of such notice) and (ii) to the extent that the Warrant Holders fail
to exercise their Call Warrants and related Optional Exchange rights on or
prior to such date, to sell the Underlying Securities and distribute the
proceeds of such sale to the Certificateholders in accordance with the
following order of priority: first, to the Trustee, as reimbursement for any
Extraordinary Trust Expenses incurred by the Trustee in accordance with
Section 6(b) below and approved by 100% of the Certificateholders; and second,
any remainder to the holders of the Class A-1 Certificates and the Class A-2
Certificates pro rata in proportion to the ratio of the Class A-1 Allocation
to the Class A-2 Allocation, as determined by the Calculation Agent.
(j) As of the Closing Date, the aggregate Certificate Principal Balance
of the Class A-1 Certificates will equal the aggregate principal amount of
Underlying Securities deposited in the Trust. From time to time after the
Closing Date, the Certificate Principal Balance of the Class A-1 Certificates
will be reduced, dollar for dollar, in connection with any reduction in the
principal amount of Underlying Securities held by the Trust as a result of (i)
any distributions made to the holders of the Class A-1 Certificates in respect
of principal of the Underlying Securities or (ii) any surrender of
Certificates in connection with the consummation of an Optional Exchange. The
Amortizing Notional Balance of the Class A-2 Certificates will be reduced by
an aggregate amount equal to (x) the sum of all Class A-2 Notional
Distribution Amounts paid to Class A-2 Certificateholders and (y) the
aggregate amount of any reductions in the Amortizing Notional Balance of the
Class A-2 Certificates pursuant to Sections 5(c) and 5(f) hereof or in
connection with any surrender of Certificates in connection with the
consummation of an Optional Exchange.
(k) (i) Within five Business Days (or such longer period as shall be
acceptable to the Trustee) of receipt of notice of an SEC Reporting Failure,
any Class A-1 Certificateholder or Class A-2 Certificateholder may direct the
Trustee to distribute all or a portion of such Certificateholder's pro rata
share of the Underlying Securities to it, in lieu of any proceeds received
upon liquidation of the Underlying Securities. The respective pro rata shares
of the Class A-1 and Class A-2 Certificateholders in the Underlying Securities
shall be determined by allocating the portion of the principal amount
remaining after reimbursement of the Trustee for any Extraordinary Trust
Expenses approved by 100% of the Certificateholders to the Class A-1
Certificateholders and the Class A-2 Certificateholders in accordance with the
ratio of the Class A-1 Allocation to the Class A-2 Allocation. The pro rata
share of each of the Class A-1 Certificateholders in the Underlying Securities
to be distributed shall be determined based on the
15
then unpaid Certificate Principal Balances of their respective Class A-1
Certificates and the pro rata share of each of the Class A-2
Certificateholders in the Underlying Securities to be distributed shall be
determined based on the Initial Amortizing Notional Balances of their
respective Class A-2 Certificates.
(ii) Within five Business Days (or such longer period as shall be
acceptable to the Trustee) of receipt of notice of an Event of Default
or any other liquidation of the Underlying Securities by the Trustee,
any Class A-2 Certificateholder may direct the Trustee to distribute all
or a portion of such Class A-2 Certificateholder's pro rata share (as
determined by the Calculation Agent in accordance with this Section
5(k)) of the Underlying Securities to it, in lieu of any proceeds
received upon liquidation of the Underlying Securities. Upon the
occurrence of an Event of Default, each Class A-2 Certificateholder's
pro rata share of the Underlying Securities shall be determined by
allocating the principal amount of the Underlying Securities to the
Class A-1 Certificateholders and the Class A-2 Certificateholders in
accordance with the ratio of the Class A-1 Allocation to the Class A-2
Allocation. The pro rata share of each of the Class A-2
Certificateholders in the Underlying Securities to be distributed shall
be determined based on the Initial Amortizing Notional Balances of their
respective Class A-2 Certificates. In the event of a liquidation of the
Underlying Securities by the Trustee for any reason other than upon the
occurrence of an Event of Default or an SEC Reporting Failure, each
Class A-2 Certificateholder's pro rata share of the Underlying
Securities shall be equal to the lesser of (1) a pro rata share (based
on the proportion of the Initial Amortizing Notional Balance of such
holder's Class A-2 Certificates to the aggregate Initial Amortizing
Notional Balance of the Class A-2 Certificates) of the principal amount
of Underlying Securities remaining after the Trustee has allocated
Available Funds in accordance with Sections 5(c)(i) and 5(c)(ii) hereof
and (2) the Amortizing Notional Balance of the related Class A-2
Certificates, plus any accrued and unpaid interest thereon.
(iii) The amount requested to be distributed pursuant to Section
5(k)(i) or 5(k)(ii) must be in an even multiple of the minimum
denomination of the Underlying Securities and may not exceed such
requesting Certificateholder's pro rata share (as determined by the
Calculation Agent in accordance with this Section 5(k)) of the
Underlying Securities. Upon receipt of any such direction from a Class
A-1 Certificateholder or Class A-2 Certificateholder, the Trustee shall
not liquidate the requested portion of Underlying Securities and instead
shall cause such Underlying Securities to be distributed to the
requesting Class A-1 Certificateholder or Class A-2 Certificateholder;
provided, that the Trustee shall not cause the distribution of any
Underlying Securities to any Class A-1 Certificateholder or Class A-2
Certificateholder unless, but for the requesting Class A-1
Certificateholder or Class A-2 Certificateholder's giving direction in
accordance with this Section 5(k), such Underlying Securities would be
liquidated as otherwise provided in this Agreement. Any portion of any
Class A-1 Certificateholder's or Class A-2 Certificateholder's pro rata
share of the Underlying Securities that is not distributed, based on the
failure to meet the minimum denomination requirements or otherwise,
shall be sold in accordance with the provisions of Section 5(e) or 5(i)
hereof, as applicable and the proceeds thereof distributed to such Class
A-1 Certificateholder or Class A-2 Certificateholder.
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(iv) All decisions and determinations of the Calculation Agent
pursuant to this Section 5(k) shall be in its sole discretion and shall,
in the absence of manifest error, be conclusive for all purposes and
irrevocably binding upon the Certificateholders.
Section 6. Trustee's Fees.
(a) As compensation for its services hereunder, the Trustee shall be
entitled to the Trustee Fee and any amounts payable under clauses 5(a)(iii)
and 5(c)(iv) above. The Trustee Fee shall be paid by the Depositor and not
from Trust Property. The Trustee shall bear all Ordinary Expenses. Failure by
the Depositor to pay such amount shall not entitle the Trustee to any payment
or reimbursement from the Trust, nor shall such failure release the Trustee
from the duties it is required to perform under the Trust Agreement.
(b) Extraordinary Expenses shall not be paid out of the Trust Property
unless all the holders of the Class A-1 Certificates and Class A-2
Certificates then outstanding have directed the Trustee to incur such
Extraordinary Expenses. The Trustee may incur other Extraordinary Expenses if
any lesser percentage of the Certificateholders requesting such action
pursuant hereto reimburse the Trustee for the cost thereof from their own
funds in advance. If Extraordinary Expenses are not approved unanimously as
set forth in the first sentence of this Section 6(b), such Extraordinary
Expenses shall not be an obligation of the Trust, and the Trustee shall not
file any claim against the Trust therefor notwithstanding failure of
Certificateholders to reimburse the Trustee.
Section 7. Optional Call; Optional Exchange.
(a) On (A) any Distribution Date, (B) any date on which the Underlying
Securities Issuer or an affiliate thereof consummates a tender offer for some
or all of the Underlying Securities or (C) any date on which the Underlying
Securities are to be redeemed by the Underlying Securities Issuer, any holder
of Class A-1 Certificates, Class A-2 Certificates and the related Call
Warrants, if Call Warrants related to such Certificates are outstanding, may
exchange such Certificates and, if applicable, Call Warrants, for a
distribution of Underlying Securities representing the same percentage of the
Underlying Securities as such Certificates represent of all outstanding
Certificates. On any Call Date, any Warrant Holder may exchange Called
Certificates for a distribution of Underlying Securities representing the same
percentage of Underlying Securities as such Called Certificates represent of
all outstanding Certificates; provided that any such exchange shall either (x)
result from an exercise of all Call Warrants owned by such Warrant Holder or
(y) occur on a Call Date on which such Warrant Holder, alone or together with
one or more other Warrant Holders, shall exchange Called Certificates relating
to Underlying Securities having an aggregate principal amount equal to or in
excess of the product of (i) 0.1 and (ii) the aggregate principal amount of
the Underlying Securities deposited into the Trust on the Closing Date.
(b) The following conditions shall apply to any Optional Exchange.
(i) A notice specifying the number of Certificates being
surrendered and the Optional Exchange Date shall be delivered to the
Trustee no less than 5 days (or such shorter period acceptable to the
Trustee) but not more than 30 days before the Optional
17
Exchange Date; provided that for an Optional Exchange to occur on a Call
Date, unless otherwise specified therein, the Call Notice shall be
deemed to be the notice required hereunder.
(ii) Certificates and, if applicable, the Call Warrants, shall be
surrendered to the Trustee no later than 10:00 a.m. (New York City time)
on the Optional Exchange Date; provided that for an Optional Exchange to
occur on a Call Date, payment of the Call Price to the Warrant Agent
pursuant to Section 1.1(a)(iii) of the Warrant Agent Agreement shall
satisfy the requirement to surrender Certificates.
(iii) Class A-1 Certificates and Class A-2 Certificates
representing a like percentage of all outstanding Class A-1 Certificates
and Class A-2 Certificates shall be surrendered.
(iv) The Trustee shall have received an opinion of counsel stating
that the Optional Exchange would not cause the Trust to be treated as an
association or publicly traded partnership taxable as a corporation for
federal income tax purposes.
(v) If the Certificateholder is the Depositor or any Affiliate of
the Depositor, (1) the Trustee shall have received a certification from
the Certificateholder that any Certificates being surrendered have been
held for at least six months, and (2) the Certificates being surrendered
may represent no more than 5% (or 25% in the case of Certificates
acquired by the Underwriter but never distributed to investors) of the
then outstanding Certificates.
(vi) The Trustee shall not be obligated to determine whether an
Optional Exchange complies with the applicable provisions for exemption
under Rule 3a-7 of the Investment Company Act of 1940, as amended, or
the rules or regulations promulgated thereunder.
(vii) The provisions of Section 4.07 of the Standard Terms shall
not apply to an Optional Exchange pursuant to this Section 7(b). This
Section 7(b) shall not provide any Person with a lien against, an
interest in or a right to specific performance with respect to the
Underlying Securities; provided that satisfaction of the conditions set
forth in this Section 7(b) shall entitle the Certificateholder or
Warrant Holder, as applicable, to a distribution thereof.
(viii) The aggregate Certificate Principal Balance or
Amortizing Notional Balance, as the case may be, of Certificates
exchanged in connection with any Optional Exchange pursuant to this
Section shall be in an amount that will entitle the Certificateholders
thereof to Underlying Securities in an even multiple of the minimum
denomination of such Underlying Securities.
(ix) In the event such Optional Exchange shall occur prior to the
Distribution Date in August 2004, the Certificateholders shall have paid
to the Trustee, for distribution to the Depositor, on the Optional
Exchange Date an amount equal to the sum obtained by multiplying the
amount of accrued interest on the Underlying Securities from February
20, 2004 through, but excluding, the Closing Date by a fraction, the
numerator
18
of which shall be the number of Certificates being exchanged on such
Optional Exchange Date and the denominator of which shall be the total
number of Certificates.
(c) Concurrently with the execution of this Series Supplement, the
Trustee, on behalf of the Trust, shall execute the Warrant Agent Agreement and
the Call Warrants, dated as of the date hereof and substantially in the form
of Exhibit B hereto, initially evidencing all of the Call Warrants. The
Trustee shall perform the Trust's obligations under the Warrant Agent
Agreement and the Call Warrants in accordance with their respective terms.
(d) Call Warrants may be exercised by the Warrant Holder in whole or in
part on any Call Date. In addition to the conditions set forth in Section 1.1
of the Warrant Agent Agreement, the following conditions shall apply to any
Optional Call.
(i) [Reserved.]
(ii) The Warrant Holder shall have provided a certificate of
solvency to the Trustee.
(iii) Upon receipt of a Call Notice, the Trustee shall provide a
conditional call notice to the Depository not less than 3 Business Days
prior to the Call Date.
(iv) Delivery of a Call Notice does not give rise to an obligation
on the part of the Warrant Holder to pay the Call Price. If, by 10:00
a.m. (New York City time) on the Call Date, the Warrant Holder has not
paid the Call Price, except in connection with a Call Notice relating to
a tender offer for or redemption of the Underlying Securities, then the
Call Notice shall automatically expire and none of the Warrant Holder,
the Warrant Agent or the Trustee shall have any obligation with respect
to the Call Notice. The expiration of a Call Notice shall in no way
affect the Warrant Xxxxxx's right to deliver a Call Notice at a later
date. The Call Price for a call in connection with a tender offer or
redemption shall be deducted from the proceeds of a tender offer or
redemption by the Trust pursuant to Section 7(g)(iii) or Section
7(h)(iii), as applicable.
(v) Subject to receipt of the Call Price, the Trustee shall pay
the applicable portion of the Call Price to the Class A-1 and Class A-2
Certificateholders on the Call Date. The Call Price for each Class of
Certificates in respect of partial calls shall be allocated pro rata to
the Certificateholders of such Class.
(vi) The Trustee shall not consent to any amendment or
modification of this Agreement (including the Standard Terms) which
would adversely affect the Warrant Holders (including, without
limitation, any alteration of the timing or amount of any payment of the
Call Price or any other provision of this Agreement in a manner adverse
to the Warrant Holders) without the prior written consent of 100% of the
Warrant Holders. For purposes of this clause, no amendment, modification
or supplement required to provide for any purchase by the Trustee of
additional Underlying Securities and authentication and delivery by the
Trustee of additional Certificates and Call Warrants pursuant to Section
3(d) shall be deemed to adversely affect the Warrant Holders.
19
(vii) The Trustee shall not be obligated to determine whether an
Optional Call complies with the applicable provisions for exemption
under Rule 3a-7 of the Investment Company Act of 1940, as amended, or
the rules or regulations promulgated thereunder.
(e) This Section 7 shall not provide the Warrant Holder with a lien
against, an interest in or a right to specific performance with respect to the
Underlying Securities; provided that satisfaction of the conditions set forth
in Section 7(b) shall entitle the Certificateholders or the Warrant Holders,
as applicable, to a distribution of the Underlying Securities.
(f) The rights of the Certificateholders under the Trust Agreement and
the Certificates are limited by the terms, provisions and conditions of the
Trust Agreement, the Warrant Agent Agreement and the Call Warrants with
respect to the exercise of the Call Warrants by the Warrant Holder. The
Certificateholders, by their acceptance of Certificates, covenant and agree to
tender any and all Called Certificates to the Trustee upon the Warrant
Holder's exercise of Call Warrants and payment of the Call Price for such
Certificates in accordance with the provisions hereof and of the Warrant Agent
Agreement.
(g) (i) If the Trustee receives notice of a tender offer for some or all
of the Underlying Securities, the Trustee shall within one Business Day notify
the Warrant Agent and forward to the Warrant Agent copies of all materials
received by the Trustee in connection therewith. If the Trustee receives a
Call Notice from any Warrant Holder no later than five Business Days prior to
the expiration of the tender offer acceptance period that such Warrant Holder
desires to exercise all or a portion of its Call Warrants in connection with
the consummation of any such tender offer, then the Trustee shall tender, in
compliance with the tender offer requirements, an amount of Underlying
Securities equal to the amount of Underlying Securities that would be
distributable to the Warrant Holder with respect to an Optional Exchange of
the Called Certificates called by such Warrant Holder; provided that any
Optional Call or Optional Exchange undertaken in connection with any such
tender offer shall be subject to the provisions of Section 7 hereof.
(ii) The Call Date and Optional Exchange Date for any exercise of
Call Warrants in connection with a tender offer shall be deemed to be
the Business Day on which such Underlying Securities are accepted for
payment and paid for.
(iii) The Call Price shall be deducted from the tender offer
proceeds and paid to Certificateholders in accordance with Section
7(d)(v), and the excess of the tender offer proceeds over the Call Price
shall be paid to the exercising Warrant Holders pro rata in respect to
their proportionate exercises of Call Warrants or, if the Call Price
exceeds the tender offer proceeds, the amount of such excess shall be
paid by the exercising Warrant Holders pro rata in respect to their
proportionate exercises of Call Warrants.
(iv) If fewer than all tendered Underlying Securities are accepted
for payment and paid for, (A) the amount of Call Warrants exercised
shall be reduced to an amount that corresponds to a number of
Certificates that could be exchanged in an Optional Exchange for the
Underlying Securities accepted for payment and paid for (without regard
to any restrictions on the amount to be exchanged, so long as such
restrictions
20
would have been satisfied had all tendered Underlying Securities been
accepted for payment and paid for); (B) each Warrant Holder's exercise
shall be reduced by its share (proportionate to the amount specified in
its exercise notice) of the amount of Underlying Securities not accepted
for payment and paid for; (C) the Call Price shall be determined after
giving effect to the reduction specified in clause (B); (D) the Call
Warrants that relate to the reduction specified in clause (B) shall
remain outstanding; and (E) the excess of the tender offer proceeds over
the Call Price shall be allocated in proportion to the amount of Call
Warrants deemed exercised as set forth in clause (A) above or, if the
Call Price exceeds the tender offer proceeds the amount of such excess
shall be paid by the exercising Warrant Holders pro rata in respect to
their proportionate exercises of Call Warrants.
(v) If the tender offer is terminated by the Underlying Securities
Issuer without consummation thereof or if all tenders by the Trust of
Underlying Securities are otherwise rejected, then (1) the Call Notices
will be of no further force and effect, and (2) any Call Warrants
relating to such Call Notices will not be exercised and will remain
outstanding.
(h) (i) If the Trustee receives notice of a redemption by the Underlying
Securities Issuer for some or all of the Underlying Securities, the Trustee
shall, within three Business Days, notify the Warrant Agent and forward to the
Warrant Agent copies of all materials received by the Trustee in connection
therewith. Any Warrant Holder that desires to call Underlying Securities in
connection with a redemption by the Underlying Securities Issuer shall send a
Call Notice to the Trustee no later than seven Business Days prior to the date
such Underlying Securities are to be redeemed.
(ii) The Call Date and Optional Exchange Date for any exercise of
Call Warrants in connection with a redemption by the Underlying
Securities Issuer shall be deemed to be the Business Day on which such
Underlying Securities are redeemed by the Underlying Securities Issuer.
(iii) The Call Price shall be deducted from the redemption
proceeds and paid to Certificateholders in accordance with Section
7(d)(v), and the excess of the redemption proceeds over the Call Price
shall be paid to the exercising Warrant Holders pro rata in respect to
their proportionate exercises of Call Warrants.
(iv) If fewer than all Underlying Securities are redeemed by the
Underlying Securities Issuer and the amount of Call Warrants exercised
corresponds to a number of Class A-1 and Class A-2 Certificates that
could be exchanged in an Optional Exchange for a principal amount of
Underlying Securities that exceeds the principal amount of Underlying
Securities actually redeemed, then, unless otherwise directed by any
exercising Warrant Holder, (A) the amount of Call Warrants exercised
shall be reduced to an amount that corresponds to a number of Class A-1
and Class A-2 Certificates that could be exchanged in an Optional
Exchange for the principal amount of Underlying Securities redeemed by
the Underlying Securities Issuer (without regard to any restrictions on
the amount to be exchanged); (B) each Warrant Holder's exercise shall be
reduced by its share (proportionate to the amount specified in its
exercise notice) of the
21
amount of such excess; (C) the Call Price shall be determined after
giving effect to the reduction specified in clause (B); (D) the Call
Warrants that relate to the reduction specified in clause (B) shall
remain outstanding; and (E) the excess of the redemption proceeds over
the Call Price shall be allocated in proportion to the amount of Call
Warrants deemed exercised as set forth in clause (A) above.
(v) If the Underlying Securities are not redeemed by the
Underlying Securities Issuer for any reason, then (1) the Call Notices
will be of no further force and effect, and (2) any Call Warrants
relating to such Call Notices will not be exercised and will remain
outstanding.
Section 8. Notices of Events of Default.
As promptly as practicable after, and in any event within 30 days
after, the occurrence of any Event of Default actually known to the Trustee,
the Trustee shall give notice of such Event of Default to the Depository, or,
if any Certificates are not then held by DTC or any other depository, directly
to the registered holders of such Certificates, and to the Warrant Agent.
However, except in the case of an Event of Default relating to the payment of
principal of or interest on any of the Underlying Securities, the Trustee will
be protected in withholding such notice if in good faith it determines that
the withholding of such notice is in the interest of the Certificateholders.
Section 9. Miscellaneous.
(a) The provisions of Section 4.04, Advances, of the Standard Terms
shall not apply to the Xxxxxxx Xxxxx Capital I Securities-Backed Series 2004-7
Certificates.
(b) The provisions of Section 4.07, Optional Exchange, of the Standard
Terms shall not apply to the Xxxxxxx Xxxxx Capital I Securities-Backed Series
2004-7 Certificates.
(c) The Trustee shall simultaneously forward reports to
Certificateholders pursuant to Section 4.03 of the Standard Terms and to the
New York Stock Exchange.
(d) Except as expressly provided herein, the Certificateholders shall
not be entitled to terminate the Trust or cause the sale or other disposition
of the Underlying Securities.
(e) The provisions of Section 3.07(d) of the Standard Terms shall not
apply to the Xxxxxxx Xxxxx Capital I Securities-Backed Series 2004-7
Certificates.
(f) If the Trustee has not received payment with respect to a Collection
Period on the Underlying Securities on or prior to the related Distribution
Date, such distribution will be made promptly upon receipt of such payment. No
additional amounts shall accrue on the Certificates or be owed to
Certificateholders as a result of such delay; provided, however, that any
additional interest owed and paid by the Underlying Securities Issuer as a
result of such delay shall be paid to the Class A-1 Certificateholders and
Class A-2 Certificateholders pro rata in proportion to their respective
entitlements to such delayed payments.
22
(g) The outstanding Certificate Principal Balance or Amortizing Notional
Balance, as the case may be, of the Certificates shall not be reduced by the
amount of any Realized Losses (as defined in the Standard Terms).
(h) The Trust may not engage in any business or activities other than in
connection with, or relating to, the holding, protecting and preserving of the
Trust Property and the issuance of the Certificates and the Call Warrants, and
other than those required or authorized by the Trust Agreement or incidental
and necessary to accomplish such activities. The Trust may not issue or sell
any certificates or other obligations other than the Certificates and the Call
Warrants or otherwise incur, assume or guarantee any indebtedness for money
borrowed. Notwithstanding Section 3.05 of the Standard Terms, funds on deposit
in the Certificate Account shall not be invested. Section 2.01(f) of the
Standard Terms shall be superseded by this provision.
(i) Notwithstanding anything in the Trust Agreement to the contrary, the
Trustee may be removed upon 60 days prior written notice delivered by the
holders of Class A-1 Certificates and Class A-2 Certificates representing the
Required Percentage--Removal.
(j) In the event that the Internal Revenue Service challenges the
characterization of the Trust as a grantor trust, the Trustee shall then file
such forms as the Depositor may specify to establish the Trust's election
pursuant to Section 761 of the Code to exclude the Trust from the application
of Subchapter K of the Code and is hereby empowered to execute such forms on
behalf of the Certificateholders.
(k) Notwithstanding anything in the Standard Terms to the contrary, the
Trustee, upon written direction by the Depositor, will execute the
Certificates.
(l) In relation to Section 7.01(f) of the Standard Terms, any periodic
reports filed by the Trustee pursuant to the Exchange Act in accordance with
the customary practices of the Depositor, need not contain any independent
reports. Notwithstanding anything to the contrary, any references in such
reports (or any exhibits attached thereto) to "servicing obligations" of the
Trustee shall be limited to the obligations of the Trustee expressly set forth
in the Trust Agreement.
(m) Notwithstanding anything in the Trust Agreement to the contrary, the
Trustee will have no recourse to the Underlying Securities.
(n) A Plan fiduciary, whether or not a Certificateholder at such time,
may request in writing that the Trustee provide such Plan fiduciary with such
information as shall be necessary for it to determine whether any of the Call
Warrant holders is (i) a "party in interest" (within the meaning of ERISA,
Section 3(14)); or (ii) a "disqualified person" within the meaning of Internal
Revenue Code ("Code") Section 4975(e)(2) with respect to any employee benefit
plan or Plan identified to the Trustee by such Plan fiduciary at the time such
request is made in order for the Plan fiduciary to determine whether an
investment in the Certificates by such Plan is or would be permissible under
ERISA or the Code. Any such written request of a Plan fiduciary shall be
accompanied by a certification of the Plan fiduciary, opinion of counsel
experienced in such issues, and such other documentation as the Trustee may
require, in order to establish that such
23
disclosure is necessary for the Plan fiduciary to determine compliance with
ERISA and the Code, as well as a confidentiality agreement, whereby the Plan
fiduciary agrees not to disclose the identity of any Call Warrant holders
except to any legal or other experts as necessary to make such determination.
The holder of a Call Warrant shall upon reasonable request of the Trustee, in
order for the Trustee to satisfy its obligations to a Plan fiduciary, provide
the Trustee with any one or more of the following, in the sole discretion of
the Call Warrant holder: (i) a certificate that each of the Call Warrant
holders is not (x) a "party in interest" (within the meaning of ERISA, Section
3(14)) with respect to any "employee benefit plan" as defined in ERISA,
Section 3(3); or (y) a "disqualified person" within the meaning of Internal
Revenue Code Section 4975(e)(2) with respect to a "Plan" as defined in Code
Section 4975(e)(1) except in each case with respect to plans sponsored by the
Call Warrant holder or its affiliates which cover employees of the Call
Warrant holder and/or such affiliates; (ii) a certificate that each of the
Call Warrant holders is not such a "party in interest" or "disqualified
person" with respect to any employee benefit plan or Plan identified to the
Trustee by such Plan fiduciary at the time such request is made; or (iii) a
written consent to the limited disclosure of the respective Call Warrant
holder's identity to a specific Plan fiduciary solely for purposes of allowing
the Trustee to satisfy its obligations to a Plan fiduciary.
(o) The Trust will not merge or consolidate with any other entity
without confirmation from each Rating Agency that such merger or consolidation
will not result in the qualification, reduction or withdrawal of its
then-current rating on the Certificates.
(p) All directions, demands and notices hereunder or under the Standard
Terms shall be in writing and shall be delivered as set forth below (unless
written notice is otherwise provided to the Trustee).
If to the Depositor, to:
Xxxxxx ABS Corporation
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Structured Credit Trading
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Trustee or the Warrant Agent, to:
U.S. Bank Trust National Association
000 Xxxx Xxxxxx Xxx
Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
24
If to the Rating Agencies, to:
Xxxxx'x Investors Service, Inc.
00 Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: CBO/CLO Monitoring Department
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and to:
Standard & Poor's Ratings Services
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Structured Finance Surveillance Group
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the New York Stock Exchange, to:
New York Stock Exchange, Inc.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx, Managing Director, Investment
Banking Services/Structured Products
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Copies of all directions, demands and notices required to be given
to the Certificateholders hereunder or under the Standard Terms will also be
given to the Warrant Holders in writing as set forth in this Section 9, and
copies of all directions, demands and notices required to be given to the
Trustee hereunder or under the Standard Terms will also be given to the
Warrant Agent in writing as set forth in this Section 9(p).
(q) Each of the representations, covenants and agreements made herein by
each of the Depositor and the Trustee are for the benefit of the
Certificateholders and the Warrant Holders.
(r) The provisions of Section 2.01(d)(iii) of the Standard Terms shall
not apply to the Xxxxxxx Xxxxx Capital I Securities-Backed Series 2004-7
Certificates and the following shall be deemed to be inserted in its place:
"at the time of delivery of the Underlying Securities, the
Depositor owns such Underlying Securities, has the right to transfer its
interest in such Underlying Securities and such Underlying Securities are free
and clear of any lien, pledge, encumbrance, right, charge, claim or other
security interest; and"
(s) The Trustee shall appoint a firm of independent certified public
accountants to determine that the asset of the Trust exists at the balance
sheet date and that such asset of the
25
Trust reflects the correct value on that date and to review each of the
distribution reports prepared by the Trustee pursuant to Section 4.03 of the
Standard Terms and to verify (x) that such reports and the calculations made
therein were made accurately and in accordance with the terms of the Trust
Agreement and (y) that the Depositor and the Trustee have each fulfilled their
obligations under this Trust Agreement. The Trustee shall instruct the
accountants (i) to promptly report to the Trustee any errors in such
distribution reports discovered in verifying such calculations and (ii) to
render to the Trustee an annual examination report, prepared in compliance
with procedures to be agreed upon between the Depositor and such independent
certified public accountants based on established or stated criteria as set
forth in the professional standards of the American Institute of Certified
Public Accountants, within 45 days (or such longer period as may be acceptable
to the Trustee) following the end of each calendar year that specifies the
calculations made in reviewing the distribution reports prepared by the
Trustee for the previous calendar year and such accountants' associated
findings.
Section 10. Governing Law. THIS SERIES SUPPLEMENT AND THE TRANSACTIONS
DESCRIBED HEREIN SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED
WITHIN THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CHOICE OF LAWS
PROVISIONS THEREOF.
Section 11. Counterparts. This Series Supplement may be executed in any
number of counterparts, each of which shall be deemed to be an original, and
all such counterparts shall constitute but one and the same instrument.
Section 12. Termination of the Trust. The Trust shall terminate upon the
earliest to occur of (i) the payment in full at maturity or sale by the Trust
after a payment default, call or an acceleration or other early payment of the
Underlying Securities and the distribution in full of all amounts due to the
Class A-1 Certificateholders and Class A-2 Certificateholders; (ii) the
exercise of all outstanding Call Warrants by the Warrant Holder; (iii) the
final Distribution Date and (iv) the expiration of 21 years from the death of
the last survivor of the descendants of Xxxxxx X. Xxxxxxx, the late Ambassador
of the United States to the Court of St. Xxxxx, living on the date hereof.
Section 13. Sale of Underlying Securities. In the event of a sale of the
Underlying Securities pursuant to this Agreement or pursuant to the
instructions of the Warrant Agent under Section 1.2 of the Warrant Agent
Agreement, the Trustee shall solicit bids for the sale of the Underlying
Securities with settlement thereof on or before the third Business Day after
such sale from three leading dealers in the relevant market. Any of the
following dealers (or their successors) shall be deemed to qualify as leading
dealers: (1) Credit Suisse First Boston LLC, (2) Xxxxxxx, Xxxxx & Co., (3)
Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated, (4) UBS Securities LLC,
(5) Citigroup Global Markets Inc., and (6) except in the case of a sale
related to the exercise of Call Warrants by the Depositor or any Affiliate
thereof, Xxxxxx Brothers Inc. The Trustee shall not be responsible for the
failure to obtain a bid so long as it has made reasonable efforts to obtain
bids. If a bid for the sale of the Underlying Securities has been accepted by
the Trustee but the sale has failed to settle on the proposed settlement date,
the Trustee shall request new bids from such leading dealers. In the event of
an Optional Exchange, the Trustee shall only deliver the Underlying Securities
to the purchaser of such Underlying
26
Securities or sell the Underlying Securities pursuant to this Section 13, as
the case may be, against payment in same day funds deposited into the
Certificate Account.
Section 14. Amendments. Notwithstanding anything in the Trust Agreement
to the contrary, in addition to the other restrictions on modification and
amendment contained therein, the Trustee shall not enter into any amendment or
modification of the Trust Agreement which would adversely affect in any
material respect the interests of the holders of any class of Certificates
without the consent of the holders of 100% of such class of Certificates;
provided, however, that no such amendment or modification will be permitted
which would cause the Trust to be taxed as an association or publicly traded
partnership taxable as a corporation for federal income tax purposes. Unless
otherwise agreed, the Trustee shall provide five Business Days written notice
to each Rating Agency before entering into any amendment or modification of
the Trust Agreement pursuant to this Section 14.
Section 15. Voting of Underlying Securities, Modification of Underlying
Securities Trust Agreement; Optional Exchange.
(a) The Trustee, as holder of the Underlying Securities, has the right
to vote and give consents and waivers in respect of the Underlying Securities
as permitted by the Depository and except as otherwise limited by the Trust
Agreement. In the event that the Trustee receives a request from the
Depository, the Underlying Securities Trustees or the Underlying Securities
Issuer for its consent to any amendment, modification or waiver of the
Underlying Securities, the Underlying Securities Trust Agreement or any other
document thereunder or relating thereto, or receives any other solicitation
for any action with respect to the Underlying Securities, the Trustee shall
mail a notice of such proposed amendment, modification, waiver or solicitation
to each Certificateholder of record as of such date. The Trustee shall request
instructions from the Certificateholders as to whether or not to consent to or
vote to accept such amendment, modification, waiver or solicitation. The
Trustee shall consent or vote, or refrain from consenting or voting, in the
same proportion as the Voting Rights of the Trust were actually voted or not
voted by the Certificateholders thereof as of a date determined by the Trustee
prior to the date on which such consent or vote is required; provided,
however, that, notwithstanding anything in the Trust Agreement to the
contrary, the Trustee shall at no time vote on or consent to any matter (i)
unless such vote or consent would not (based on an opinion of counsel) cause
the Trust to be taxed as an association or publicly traded partnership taxable
as a corporation under the Code, (ii) which would alter the timing or amount
of any payment on the Underlying Securities, including, without limitation,
any demand to accelerate the Underlying Securities, except in the event of a
default under the Underlying Securities or an event which with the passage of
time would become an event of default under the Underlying Securities and with
the unanimous consent of Certificateholders representing 100% of the aggregate
Voting Rights and 100% of the Warrant Holders, or (iii) which would result in
the exchange or substitution of any of the outstanding Underlying Securities
pursuant to a plan for the refunding or refinancing of such Underlying
Securities except in the event of a default under the Underlying Securities
Trust Agreement and only with the consent of Certificateholders representing
100% of the aggregate Voting Rights and 100% of the Warrant Holders. The
Trustee shall have no liability for any failure to act resulting from
Certificateholders' late return of, or failure to return, directions requested
by the Trustee from the Certificateholders.
27
(b) In the event that an offer is made by the Underlying Securities
Issuer to issue new obligations in exchange and substitution for any of the
Underlying Securities, pursuant to a plan for the refunding or refinancing of
the outstanding Underlying Securities or any other offer is made for the
Underlying Securities, the Trustee shall notify the Class A-1
Certificateholders, Class A-2 Certificateholders and the Warrant Holders of
such offer promptly. Subject to the rights of the Warrant Holders to exercise
Call Warrants in connection with a tender offer for the Underlying Securities,
the Trustee must reject any such offer unless an Underlying Securities event
of default has occurred and the Trustee is directed by the affirmative vote of
Certificateholders representing 100% of the aggregate Voting Rights to accept
such offer and the Trustee has received the tax opinion described above. If
pursuant to the preceding sentence, the Trustee accepts any such offer the
Trustee shall promptly notify the Rating Agencies.
(c) If an event of default under the Underlying Securities Trust
Agreement occurs and is continuing, and if directed by a majority of the
outstanding Class A-1 Certificateholders and Class A-2 Certificateholders, the
Trustee shall vote the Underlying Securities in favor of directing, or take
such other action as may be appropriate to direct, the applicable Underlying
Securities Trustee to declare the unpaid principal amount of the Underlying
Securities and any accrued and unpaid interest thereon to be due and payable.
Section 16. Additional Depositor Representation. It is the express
intent of the parties hereto that the conveyance of the Underlying Securities
by the Depositor to the Trustee be, and be construed as, a sale of the
Underlying Securities by the Depositor and not a pledge of any Underlying
Securities by the Depositor to secure a debt or other obligation of the
Depositor. In the event that, notwithstanding the aforementioned intent of the
parties, any Underlying Securities are held to be property of the Depositor,
then, it is the express intent of the parties that such conveyance be deemed a
pledge of such Underlying Securities and all proceeds thereof by the Depositor
to the Trustee to secure a debt or other obligation of the Depositor, pursuant
to Section 10.07 of the Standard Terms. In connection with any such grant of a
security interest in the Underlying Securities and all proceeds thereof
(including any such grant in connection with any sale of additional Underlying
Securities pursuant to Section 3(d)), the Depositor hereby represents and
warrants to Trustee as follows:
(i) In the event the Underlying Securities are held to be
property of the Depositor, then the Trust Agreement creates
a valid and continuing security interest (as defined in the
UCC) in the Underlying Securities in favor of the Securities
Intermediary which security interest is prior to all other
liens, and is enforceable as such as against creditors of,
and purchasers from, the Depositor.
(ii) The Underlying Securities have been credited to a trust
account (the "Securities Account") established in the name
of the Trustee in accordance with Section 2.01 of the
Standard Terms. U.S. Bank Trust National Association, as
securities intermediary (the "Securities Intermediary") has
established the Securities Account and has agreed to treat
the Underlying Securities as "financial assets" within the
meaning of the UCC.
28
(iii) Immediately prior to the transfer of the Underlying
Securities to the Trust, the Depositor owned and had good
and marketable title to the Underlying Securities free and
clear of any lien, claim or encumbrance of any Person.
(iv) The Depositor has received all consents and approvals
required by the terms of the Underlying Securities for the
transfer to the Trustee all of the Depositor's interest and
rights in the Underlying Securities as contemplated by the
Trust Agreement.
(v) The Depositor has taken all steps necessary to cause the
Securities Intermediary to identify on its records that the
Trustee is the Person owning the security entitlements
credited to the Securities Account.
(vi) Other than the security interest granted to the Trust
pursuant to this Agreement, the Depositor has not assigned,
pledged, sold, granted a security interest in or otherwise
conveyed any interest in the Underlying Securities (or, if
any such interest has been assigned, pledged or otherwise
encumbered, it has been released). The Depositor has not
authorized the filing of and is not aware of any financing
statements against the Depositor that include a description
of the Underlying Securities other than any financing
statement relating to the security interest granted to the
Trust hereunder. The Depositor is not aware of any judgment
or tax lien filings against the Depositor.
(vii) The Securities Account is not in the name of any Person
other than the Trustee. The Depositor has not consented to
the compliance by the Securities Intermediary, with
entitlement orders of any Person other than the Trustee.
29
IN WITNESS WHEREOF, the parties hereto have caused this Series
Supplement to be duly executed by their respective authorized officers as of
the date first written above.
XXXXXX ABS CORPORATION,
as Depositor
By: /s/ Xxxx Xxxxxxxxxxx
---------------------------------------
Name: Xxxx Xxxxxxxxxxx
Title: Senior Vice President
U.S. BANK TRUST NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Trustee on behalf of the
Corporate Backed Trust Certificates
Xxxxxxx Xxxxx Capital I Securities-Backed
Series 2004-7 Trust
By: /s/ Xxxxx X. Xxxxxxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: Vice President
30
SCHEDULE I
XXXXXXX XXXXX CAPITAL I SECURITIES-BACKED SERIES 2004-7
UNDERLYING SECURITIES SCHEDULE
Underlying Securities: 6.345% Capital Securities.
Issuer: Xxxxxxx Xxxxx Capital I.
Junior Subordinated Debenture Issuer The Xxxxxxx Xxxxx Group.
and Underlying Securities Guarantor:
CUSIP Number: 00000XXX0.
Principal Amount Deposited: $30,000,000.
Original Issue Date: February 20, 2004.
Principal Amount of
Underlying Securities
Originally Issued: $2,750,000,000.
Maturity Date: February 15, 2034.
Interest Rate: The Underlying Securities were issued
with an initial interest rate of
6.345%.
Interest Payment Dates: February 15th and August 15th.
I-1
SCHEDULE II
CLASS A-2 AMORTIZATION SCHEDULE(1)
Class A-2 Amortizing
Scheduled Interest Notional Balance
Date Notional Amount Paid Total Paid After Amortization
------------- ----------------- ----------- ------------- -------------------
4/30/2004 - - - $162,000
8/15/2004 $955 $3,497 $4,451 $161,045
2/15/2005 $791 $5,959 $6,750 $160,254
8/15/2005 $821 $5,929 $6,750 $159,433
2/15/2006 $851 $5,899 $6,750 $158,582
8/15/2006 $882 $5,868 $6,750 $157,700
2/15/2007 $915 $5,835 $6,750 $156,785
8/15/2007 $949 $5,801 $6,750 $155,836
2/15/2008 $984 $5,766 $6,750 $154,852
8/15/2008 $1,020 $5,730 $6,750 $153,831
2/15/2009 $1,058 $5,692 $6,750 $152,773
8/15/2009 $1,097 $5,653 $6,750 $151,676
2/15/2010 $1,138 $5,612 $6,750 $150,537
8/15/2010 $1,180 $5,570 $6,750 $149,357
2/15/2011 $1,224 $5,526 $6,750 $148,134
8/15/2011 $1,269 $5,481 $6,750 $146,865
2/15/2012 $1,316 $5,434 $6,750 $145,549
8/15/2012 $1,365 $5,385 $6,750 $144,184
2/15/2013 $1,415 $5,335 $6,750 $142,769
8/15/2013 $1,468 $5,282 $6,750 $141,301
2/15/2014 $1,522 $5,228 $6,750 $139,779
8/15/2014 $1,578 $5,172 $6,750 $138,201
2/15/2015 $1,637 $5,113 $6,750 $136,564
8/15/2015 $1,697 $5,053 $6,750 $134,867
2/15/2016 $1,760 $4,990 $6,750 $133,107
8/15/2016 $1,825 $4,925 $6,750 $131,282
2/15/2017 $1,893 $4,857 $6,750 $129,390
8/15/2017 $1,963 $4,787 $6,750 $127,427
2/15/2018 $2,035 $4,715 $6,750 $125,392
8/15/2018 $2,110 $4,640 $6,750 $123,282
2/15/2019 $2,189 $4,561 $6,750 $121,093
8/15/2019 $2,270 $4,480 $6,750 $118,823
------------------------
1 The Class A-2 Amortization Schedule shall be amended in connection with
any increase or reduction in the Amortizing Notional Balance of Class
A-2 Certificates. In addition, the payment to holders of Class A-2
Certificates is subject to the payment of interest on the Underlying
Securities by the Underlying Securities Issuer, and will be deferred if
any such interest payments are deferred by the Underlying Securities
Issuer.
II-1
Class A-2 Amortizing
Scheduled Interest Notional Balance
Date Notional Amount Paid Total Paid After Amortization
------------- ----------------- ----------- ------------- -------------------
2/15/2020 $2,354 $4,396 $6,750 $116,470
8/15/2020 $2,441 $4,309 $6,750 $114,029
2/15/2021 $2,531 $4,219 $6,750 $111,498
8/15/2021 $2,625 $4,125 $6,750 $108,874
2/15/2022 $2,722 $4,028 $6,750 $106,152
8/15/2022 $2,822 $3,928 $6,750 $103,330
2/15/2023 $2,927 $3,823 $6,750 $100,403
8/15/2023 $3,035 $3,715 $6,750 $97,368
2/15/2024 $3,147 $3,603 $6,750 $94,221
8/15/2024 $3,264 $3,486 $6,750 $90,957
2/15/2025 $3,385 $3,365 $6,750 $87,572
8/15/2025 $3,510 $3,240 $6,750 $84,062
2/15/2026 $3,640 $3,110 $6,750 $80,423
8/15/2026 $3,774 $2,976 $6,750 $76,648
2/15/2027 $3,914 $2,836 $6,750 $72,734
8/15/2027 $4,059 $2,691 $6,750 $68,675
2/15/2028 $4,209 $2,541 $6,750 $64,466
8/15/2028 $4,365 $2,385 $6,750 $60,102
2/15/2029 $4,526 $2,224 $6,750 $55,575
8/15/2029 $4,694 $2,056 $6,750 $50,882
2/15/2030 $4,867 $1,883 $6,750 $46,014
8/15/2030 $5,047 $1,703 $6,750 $40,967
2/15/2031 $5,234 $1,516 $6,750 $35,733
8/15/2031 $5,428 $1,322 $6,750 $30,305
2/15/2032 $5,629 $1,121 $6,750 $24,676
8/15/2032 $5,837 $913 $6,750 $18,839
2/15/2033 $6,053 $697 $6,750 $12,786
8/15/2033 $6,277 $473 $6,750 $6,509
2/15/2034 $6,509 $241 $6,750 $(0)
II-2
EXHIBIT A-1
FORM OF TRUST CERTIFICATE CLASS A-1
CLASS A-1 CERTIFICATE
---------------------
NUMBER 2 1,200,000 $25 PAR CERTIFICATES
CUSIP NO. 21988K 83 4
SEE REVERSE FOR CERTAIN DEFINITIONS
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE REPRESENTS A PROPORTIONATE UNDIVIDED BENEFICIAL OWNERSHIP
INTEREST IN THE TRUST AND DOES NOT EVIDENCE AN OBLIGATION OF, OR AN INTEREST
IN, AND IS NOT GUARANTEED BY THE DEPOSITOR OR THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE TRUST ASSETS ARE
INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR ANY OTHER PERSON.
THE CERTIFICATEHOLDERS, BY THEIR ACCEPTANCE OF CERTIFICATES, COVENANT AND
AGREE TO TENDER ANY AND ALL CALLED CERTIFICATES TO THE TRUSTEE UPON THE
WARRANT HOLDER'S EXERCISE OF CALL WARRANTS AND PAYMENT OF THE CALL PRICE FOR
SUCH CERTIFICATES IN ACCORDANCE WITH THE PROVISIONS HEREOF AND OF THE WARRANT
AGENT AGREEMENT.
A-1-1
XXXXXX ABS CORPORATION
1,200,000 $25 PAR
CORPORATE BACKED TRUST CERTIFICATES,
XXXXXXX XXXXX CAPITAL I SECURITIES-BACKED SERIES 2004-7
6.30% INTEREST RATE
evidencing a proportionate undivided beneficial ownership interest
in the Trust, as defined below, the property of which consists principally of
$30,000,000 aggregate principal amount of 6.345% Capital Securities issued by
Xxxxxxx Xxxxx Capital I Securities (the "Underlying Securities Issuer") and
all payments received thereon (the "Trust Property"), deposited in trust by
Xxxxxx ABS Corporation (the "Depositor").
THIS CERTIFIES THAT CEDE & CO. is the registered owner of an aggregate of
$30,000,000 principal amount nonassessable, fully-paid, proportionate
undivided beneficial ownership interest in the Corporate Backed Trust
Certificates, Xxxxxxx Xxxxx Capital I Securities-Backed Series 2004-7 Trust,
formed by the Depositor.
The Trust was created pursuant to a Standard Terms for Trust Agreements, dated
as of January 16, 2001 (the "Standard Terms"), between the Depositor and U.S.
Bank Trust National Association, a national banking association, not in its
individual capacity but solely as Trustee (the "Trustee"), as supplemented by
the Series Supplement in respect of the Xxxxxxx Xxxxx Capital I
Securities-Backed Series 2004-7, dated as of April 30, 2004 (the "Series
Supplement"), and together with the Standard Terms and the Series Supplement,
the "Trust Agreement"), between the Depositor and the Trustee. This
Certificate does not purport to summarize the Trust Agreement and reference is
hereby made to the Trust Agreement for information with respect to the
interests, rights, benefits, obligations, proceeds and duties evidenced hereby
and the rights, duties and obligations of the Trustee with respect hereto. A
copy of the Trust Agreement may be obtained from the Trustee by written
request sent to the Corporate Trust Office. Capitalized terms used but not
defined herein have the meanings assigned to them in the Trust Agreement.
This Certificate is one of the duly authorized Certificates designated as the
"Corporate Backed Trust Certificates, Xxxxxxx Xxxxx Capital I
Securities-Backed Series 2004-7, Class A-1" (herein called the
"Certificates"). This Certificate is issued under and is subject to the terms,
provisions and conditions of the Trust Agreement, to which Trust Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound. The Trust Property consists of: (i) Underlying
Securities described in the Trust Agreement, and (ii) all payments on or
collections in respect of the Underlying Securities accrued on or after April
30, 2004, together with any and all income, proceeds and payments with respect
thereto; provided, however, that any income from the investment of Trust funds
in certain permitted investments ("Eligible Investments") does not constitute
Trust Property.
Subject to the terms and conditions of the Trust Agreement (including the
availability of funds for distributions) and until the obligation created by
the Trust Agreement shall have terminated in accordance therewith,
distributions will be made on each Distribution Date, to the Person in
A-1-2
whose name this Certificate is registered on the applicable Record Date, in an
amount equal to such Certificateholder's proportionate undivided beneficial
ownership interest in the amount required to be distributed to the Holders of
the Certificates on such Distribution Date. The Record Date applicable to any
Distribution Date is the close of business on the day immediately preceding
such Distribution Date (whether or not a Business Day). If a payment with
respect to the Underlying Securities is made to the Trustee after the date on
which such payment was due, then the Trustee will distribute any such amounts
received on the next occurring Business Day.
Each Certificateholder, by its acceptance of a Certificate, covenants and
agrees that such Certificateholder will not at any time institute against the
Trust, or join in any institution against the Trust of, any bankruptcy
proceedings under any United States Federal or state bankruptcy or similar law
in connection with any obligations relating to the Certificates or the Trust
Agreement.
Distributions made on this Certificate will be made as provided in the Trust
Agreement by the Trustee by wire transfer in immediately available funds, or
check mailed to the Certificateholder of record in the Certificate Register
without the presentation or surrender of this Certificate or the making of any
notation hereon, except that with respect to Certificates registered on the
Record Date in the name of the nominee of the Clearing Agency (initially, such
nominee shall be Cede & Co.), payments will be made by wire transfer in
immediately available funds to the account designated by such nominee. Except
as otherwise provided in the Trust Agreement and notwithstanding the above,
the final distribution on this Certificate will be made after due notice by
the Trustee of the pendency of such distribution and only upon presentation
and surrender of this Certificate at the Corporate Trust Office or such other
location as may be specified in such notice.
Reference is hereby made to the further provisions of this Certificate set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee, by manual signature, this Certificate shall not entitle
the Holder hereof to any benefit under the Trust Agreement or be valid for any
purpose.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE HOLDER HEREOF SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
A-1-3
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed as of the date set forth below.
CORPORATE BACKED TRUST CERTIFICATES,
XXXXXXX XXXXX CAPITAL I SECURITIES-BACKED
SERIES 2004-7 TRUST
By: U.S. BANK TRUST NATIONAL ASSOCIATION
not in its individual capacity but solely
as Trustee,
By:
---------------------------------
Authorized Signatory
Dated: April 30, 2004
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Corporate Backed Trust Certificates, Xxxxxxx Xxxxx Capital
I Securities-Backed Series 2004-7, described in the Trust Agreement referred
to herein.
U.S. BANK TRUST NATIONAL ASSOCIATION not in its individual capacity but solely
as Trustee,
By:
---------------------
Authorized Signatory
A-1-4
(REVERSE OF CERTIFICATE)
The Certificates are limited in right of distribution to certain payments and
collections respecting the Underlying Securities, all as more specifically set
forth herein and in the Trust Agreement. The registered Holder hereof, by its
acceptance hereof, agrees that it will look solely to the Trust Property (to
the extent of its rights therein) for distributions hereunder.
The Trust Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor and the Trustee and the rights of the Certificateholders under the
Trust Agreement at any time by the Depositor and the Trustee with the consent
of the Holders of Class A-1 Certificates in the manner set forth in the Series
Supplement and the Standard Terms. Any such consent by the Holder of this
Certificate (or any predecessor Certificate) shall be conclusive and binding
on such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange hereof or in lieu
hereof whether or not a notation of such consent is made upon this
Certificate. The Trust Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of
the Certificates.
The Certificates are issuable in fully registered form only in denominations
of $25.
As provided in the Trust Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at
the offices or agencies of the Certificate Registrar maintained by the Trustee
in the Borough of Manhattan, the City of New York, duly endorsed by or
accompanied by an assignment in the form below and by such other documents as
required by the Trust Agreement, and thereupon one or more new Certificates of
the same class in authorized denominations evidencing the same principal
amount will be issued to the designated transferee or transferees. The initial
Certificate Registrar appointed under the Trust Agreement is U.S. Bank Trust
National Association.
No service charge will be made for any registration of transfer or exchange,
but the Trustee may require exchange of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any transfer
or exchange of Certificates.
The Depositor and the Trustee and any agent of the Depositor or the Trustee
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and neither the Depositor, the Trustee, nor any such
agent shall be affected by any notice to the contrary.
It is the intention of the parties to the Trust Agreement that the Trust
created thereunder shall constitute a fixed investment trust for federal
income tax purposes under Treasury Regulation Section 301.7701-4, and the
Certificateholder agrees to treat the Trust, any distributions therefrom and
its beneficial interest in the Certificates consistently with such
characterization.
The Trust and the obligations of the Depositor and the Trustee created by the
Trust Agreement with respect to the Certificates shall terminate upon the
earliest to occur of (i) the payment in full at maturity or sale by the Trust
after a payment default on or an acceleration or other early payment of the
Underlying Securities and the distribution in full of all amounts due to the
Class A-1 Certificateholders and Class A-2 Certificateholders; (ii) the
exercise of all outstanding Call
A-1-5
Warrants by the Warrant Holders; (iii) the Final Scheduled Distribution Date
and (iv) the expiration of 21 years from the death of the last survivor of the
descendants of Xxxxxx X. Xxxxxxx, the late Ambassador of the United States to
the Court of St. Xxxxx, living on the date hereof.
An employee benefit plan subject to the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), a plan described in Section 4975(e) of the
Code, an entity whose underlying assets include plan assets by reason of any
such plan's investment in the entity, including an individual retirement
account or Xxxxx plan (any such, a "Plan") may purchase and hold Certificates
if the Plan can represent and warrant that its purchase and holding of the
Certificates would not be prohibited under ERISA or the Code.
A-1-6
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
(Please print or type name and address, including postal zip code, of
assignee) the within Certificate, and all rights thereunder, hereby
irrevocably constituting and appointing ______________________ Attorney to
transfer said Certificate on the books of the Certificate Register, with full
power of substitution in the premises.
Dated:
*
Signature Guaranteed:
*
*NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Signatures must be guaranteed
by an "eligible guarantor institution" meeting the requirements of the
Certificate Registrar, which requirements include membership or participation
in the Security Transfer Agent Medallion Program ("STAMP") or such other
"signature guarantee program" as may be determined by the Certificate
Registrar in addition to, or in substitution for, STAMP, all in accordance
with the Securities Exchange Act of 1934, as amended.
A-1-7
EXHIBIT A-2
FORM OF TRUST CERTIFICATE CLASS A-2
CLASS A-2 CERTIFICATE
---------------------
NUMBER 2 CUSIP NO. 21988K AN 7
SEE REVERSE FOR CERTAIN DEFINITIONS
THIS CLASS A-2 CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE TRANSFERRED, SOLD OR
OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION UNDER SUCH ACT IS IN EFFECT
OR PURSUANT TO AN EXEMPTION THEREFROM UNDER SUCH ACT. THE CLASS A-2
CERTIFICATE REPRESENTED HEREBY MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE
TERMS OF THE SERIES SUPPLEMENT.
EACH PURCHASER OF THIS CLASS A-2 CERTIFICATE IS HEREBY NOTIFIED THAT THE
SELLER OF THIS CLASS A-2 CERTIFICATE MAY BE RELYING ON THE EXEMPTION FROM THE
PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER.
THE NOTIONAL AMOUNT OF THIS CLASS A-2 CERTIFICATE IS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING NOTIONAL AMOUNT OF THIS CLASS A-2 CERTIFICATE AT
ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE REPRESENTS A PROPORTIONATE UNDIVIDED BENEFICIAL OWNERSHIP
INTEREST IN THE TRUST AND DOES NOT EVIDENCE AN OBLIGATION OF, OR AN INTEREST
IN, AND IS NOT GUARANTEED BY THE DEPOSITOR OR THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE OR THE TRUST ASSETS ARE
INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR ANY OTHER PERSON.
THE CERTIFICATEHOLDERS, BY THEIR ACCEPTANCE OF CERTIFICATES, COVENANT AND
AGREE TO TENDER ANY AND ALL CALLED CERTIFICATES TO
A-2-1
THE TRUSTEE UPON THE WARRANT XXXXXX'S EXERCISE OF CALL WARRANTS AND PAYMENT OF
THE CALL PRICE FOR SUCH CERTIFICATES IN ACCORDANCE WITH THE PROVISIONS HEREOF
AND OF THE WARRANT AGENT AGREEMENT.
A-2-2
XXXXXX ABS CORPORATION
CORPORATE BACKED TRUST CERTIFICATES,
XXXXXXX XXXXX CAPITAL I SECURITIES-BACKED SERIES 2004-7
$162,000 AGGREGATE INITIAL AMORTIZING NOTIONAL AMOUNT
7.40% INTEREST RATE
FINAL SCHEDULED DISTRIBUTION DATE: February 15, 2034
evidencing a proportionate undivided beneficial ownership interest in
the Trust, as defined below, the property of which consists principally of
$30,000,000 aggregate principal amount of 6.345% Capital Securities issued by
Xxxxxxx Xxxxx Capital I Securities, and all payments received thereon (the
"Trust Property"), deposited in trust by Xxxxxx ABS Corporation (the
"Depositor").
THIS CERTIFIES THAT CEDE & CO. is the registered owner of an aggregate amount
of $162,000 aggregate initial amortizing notional amount nonassessable,
fully-paid, proportionate undivided beneficial ownership interest in the
Corporate Backed Trust Certificates, Xxxxxxx Xxxxx Capital I Securities-Backed
Series 2004-7 Trust, formed by the Depositor.
The Trust was created pursuant to a Standard Terms for Trust Agreements, dated
as of January 16, 2001 (the "Standard Terms"), between the Depositor and U.S.
Bank Trust National Association, a national banking association, not in its
individual capacity but solely as Trustee (the "Trustee"), as supplemented by
the Series Supplement, Xxxxxxx Xxxxx Capital I Securities-Backed Series
2004-7, dated as of April 30, 2004 (the "Series Supplement") and, together
with the Standard Terms and the Series Supplement, the "Trust Agreement"),
between the Depositor and the Trustee. This Certificate does not purport to
summarize the Trust Agreement and reference is hereby made to the Trust
Agreement for information with respect to the interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
obligations of the Trustee with respect hereto. A copy of the Trust Agreement
may be obtained from the Trustee by written request sent to the Corporate
Trust Office. Capitalized terms used but not defined herein have the meanings
assigned to them in the Trust Agreement.
This Certificate is one of the duly authorized Certificates designated as the
"Corporate Backed Trust Certificates, Xxxxxxx Xxxxx Capital I
Securities-Backed Series 2004-7, Class A-2" (herein called the
"Certificates"). This Certificate is issued under and is subject to the terms,
provisions and conditions of the Trust Agreement, to which Trust Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound. The Trust Property consists of: (i) Underlying
Securities described in the Trust Agreement, and (ii) all payments on or
collections in respect of the Underlying Securities accrued on or after April
30, 2004, together with any and all income, proceeds and payments with respect
thereto; provided,
A-2-3
however, that any income from the investment of Trust funds in certain
permitted investments ("Eligible Investments") does not constitute Trust
Property.
Subject to the terms and conditions of the Trust Agreement (including the
availability of funds for distributions) and until the obligation created by
the Trust Agreement shall have terminated in accordance therewith,
distributions of interest will be made on this Certificate on each
Distribution Date.
Subject to the terms and conditions of the Trust Agreement (including the
availability of funds for distributions) and until the obligation created by
the Trust Agreement shall have terminated in accordance therewith,
distributions will be made on each Distribution Date, to the Person in whose
name this Certificate is registered on the applicable Record Date, in an
amount equal to such Certificateholder's proportionate undivided beneficial
ownership interest in the amount required to be distributed to the Holders of
the Certificates on such Distribution Date. The Record Date applicable to any
Distribution Date is the close of business on the day immediately preceding
such Distribution Date (whether or not a Business Day). If a payment with
respect to the Underlying Securities is made to the Trustee after the date on
which such payment was due, then the Trustee will distribute any such amounts
received on the next occurring Business Day.
Each Certificateholder, by its acceptance of a Certificate, covenants and
agrees that such Certificateholder will not at any time institute against the
Trust, or join in any institution against the Trust of, any bankruptcy
proceedings under any United States Federal or state bankruptcy or similar law
in connection with any obligations relating to the Certificates or the Trust
Agreement.
Distributions made on this Certificate will be made as provided in the Trust
Agreement by the Trustee by wire transfer in immediately available funds, or
check mailed to the Certificateholder of record in the Certificate Register
without the presentation or surrender of this Certificate or the making of any
notation hereon, except that with respect to Certificates registered on the
Record Date in the name of the nominee of the Clearing Agency (initially, such
nominee shall be Cede & Co.), payments will be made by wire transfer in
immediately available funds to the account designated by such nominee. Except
as otherwise provided in the Trust Agreement and notwithstanding the above,
the final distribution on this Certificate will be made after due notice by
the Trustee of the pendency of such distribution and only upon presentation
and surrender of this Certificate at the Corporate Trust Office or such other
location as may be specified in such notice.
Reference is hereby made to the further provisions of this Certificate set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee, by manual signature, this Certificate shall not entitle
the Holder hereof to any benefit under the Trust Agreement or be valid for any
purpose.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
A-2-4
PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE HOLDER HEREOF
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
A-2-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed as of the date set forth below.
CORPORATE BACKED TRUST CERTIFICATES,
XXXXXXX XXXXX CAPITAL I SECURITIES-BACKED
SERIES 2004-7 TRUST
By: U.S. BANK TRUST NATIONAL ASSOCIATION
not in its individual capacity but solely as
Trustee,
By:
---------------------------------
Authorized Signatory
Dated: April 30, 2004
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Corporate Backed Trust Certificates, Xxxxxxx Xxxxx Capital
I Securities-Backed Series 2004-7, described in the Trust Agreement referred
to herein.
U.S. BANK TRUST NATIONAL ASSOCIATION
not in its individual capacity but solely
as Trustee,
By:
---------------------
Authorized Signatory
A-2-6
(REVERSE OF CERTIFICATE)
The Certificates are limited in right of distribution to certain payments and
collections respecting the Underlying Securities, all as more specifically set
forth herein and in the Trust Agreement. The registered Holder hereof, by its
acceptance hereof, agrees that it will look solely to the Trust Property (to
the extent of its rights therein) for distributions hereunder.
The Trust Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor and the Trustee and the rights of the Certificateholders under the
Trust Agreement at any time by the Depositor and the Trustee with the consent
of the holders of Class A-2 Certificates in the manner set forth in the Series
Supplement and the Standard Terms. Any such consent by the Holder of this
Certificate (or any predecessor Certificate) shall be conclusive and binding
on such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange hereof or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Trust Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
The Certificates are issuable in fully registered form only in denominations
of $1,000 and in integral multiples of $1,000 in excess thereof, provided,
however, that the Certificates only be transferable in an aggregate Initial
Amortizing Notional Balance equal to or greater than $40,000.
As provided in the Trust Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at
the offices or agencies of the Certificate Registrar maintained by the Trustee
in the Borough of Manhattan, the City of New York, duly endorsed by or
accompanied by an assignment in the form below and by such other documents as
required by the Trust Agreement, and thereupon one or more new Certificates of
the same class in authorized denominations evidencing the same notional amount
will be issued to the designated transferee or transferees. The initial
Certificate Registrar appointed under the Trust Agreement is U.S. Bank Trust
National Association.
No service charge will be made for any registration of transfer or exchange,
but the Trustee may require exchange of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any transfer
or exchange of Certificates.
The Depositor and the Trustee and any agent of the Depositor or the Trustee
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and neither the Depositor, the Trustee, nor any such
agent shall be affected by any notice to the contrary.
It is the intention of the parties to the Trust Agreement that the Trust
created thereunder shall constitute a fixed investment trust for federal
income tax purposes under Treasury Regulation Section 301.7701-4, and the
Certificateholder agrees to treat the Trust, any distributions therefrom and
its beneficial interest in the Certificates consistently with such
characterization.
The Trust and the obligations of the Depositor and the Trustee
created by the Trust Agreement with respect to the Certificates shall
terminate upon the earliest to occur of (i)
A-2-7
the payment in full at maturity or sale by the Trust after a payment default
on or an acceleration or other early payment of the Underlying Securities and
the distribution in full of all amounts due to the Class A-1
Certificateholders and Class A-2 Certificateholders; (ii) the exercise of all
outstanding Call Warrants by the Warrant Holders; (iii) the Final Scheduled
Distribution Date and (iv) the expiration of 21 years from the death of the
last survivor of the descendants of Xxxxxx X. Xxxxxxx, the late Ambassador of
the United States to the Court of St. Xxxxx, living on the date hereof.
An employee benefit plan subject to the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), a plan described in Section 4975(e) of the
Code, an entity whose underlying assets include plan assets by reason of any
such plan's investment in the entity, including an individual retirement
account or Xxxxx plan (any such, a "Plan") may purchase and hold Certificates
if the Plan can represent and warrant that its purchase and holding of the
Certificates would not be prohibited under ERISA or the Code.
A-2-8
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
(Please print or type name and address, including postal zip code, of
assignee) the within Certificate, and all rights thereunder, hereby
irrevocably constituting and appointing_____________ Attorney to transfer said
Certificate on the books of the Certificate Register, with full power of
substitution in the premises.
Dated:
*
Signature Guaranteed:
*
*NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Signatures must be guaranteed
by an "eligible guarantor institution" meeting the requirements of the
Certificate Registrar, which requirements include membership or participation
in the Security Transfer Agent Medallion Program ("STAMP") or such other
"signature guarantee program" as may be determined by the Certificate
Registrar in addition to, or in substitution for, STAMP, all in accordance
with the Securities Exchange Act of 1934, as amended.
A-2-9
EXHIBIT B
FORM OF WARRANT AGENT AGREEMENT
CORPORATE BACKED TRUST CERTIFICATES
XXXXXXX XXXXX CAPITAL I SECURITIES-BACKED SERIES 2004-7 TRUST
WARRANT AGENT AGREEMENT, dated as of April 30, 2004 (the "Warrant
Agent Agreement"), by and between XXXXXX ABS CORPORATION, as Depositor (the
"Depositor"), U.S. BANK TRUST NATIONAL ASSOCIATION, as Trustee (the "Trustee")
and U.S. BANK TRUST NATIONAL ASSOCIATION, as Warrant Agent (the "Warrant
Agent").
W I T N E S S E T H:
WHEREAS, the Depositor created Corporate Backed Trust Certificates,
Xxxxxxx Xxxxx Capital I Securities-Backed Series 2004-7 Trust (the "Trust"), a
trust created under the laws of the State of New York pursuant to a Standard
Terms for Trust Agreements, dated as of January 16, 2001 (the "Agreement"),
between Xxxxxx ABS Corporation (the "Depositor") and U.S. Bank Trust National
Association, a national banking association, not in its individual capacity
but solely as Trustee (the "Trustee"), as supplemented by the Series
Supplement 2004-7, dated as of April 21, 2004 (the "Series Supplement" and,
together with the Agreement, the "Trust Agreement"), between the Depositor and
the Trustee; and
WHEREAS, in connection with the creation of the Trust and the
deposit therein of the Underlying Securities, it is desired to provide for the
issuance of trust certificates (the "Certificates") evidencing undivided
interests in the Trust and call warrants with respect to the Certificates
("Call Warrants").
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants expressed herein, it is hereby agreed by and between the
Depositor, the Warrant Agent and the Trustee that except as otherwise
specified herein or as the context may otherwise require, capitalized terms
used herein but not defined herein shall have the respective meanings set
forth below in the Series Supplement, and as follows:
ARTICLE I
EXERCISE OF CALL WARRANTS
Section 1.1 Manner of Exercise. (a) Call Warrants may be exercised by any
holder thereof (each, a "Warrant Holder") in whole or in part on any Call
Date. The following conditions shall apply to any exercise of Call Warrants:
(i) A notice (each, a "Call Notice") specifying the number of
Call Warrants being exercised and the Call Date shall be delivered
to the Warrant Agent and the Trustee at least 5 Business Days before
such Call Date.
(ii) The Warrant Holder shall surrender the Call Warrants to
the Warrant Agent at its office specified in Section 7.3 hereof no
later than 10:00 a.m. (New York City time) on such Call Date.
B-1
(iii) Except as otherwise provided herein in connection with a
Call Notice relating to a tender offer for or redemption of
Underlying Securities, the Warrant Holder shall have made payment to
the Warrant Agent, by wire transfer or other immediately available
funds acceptable to the Warrant Agent, in the amount of the Call
Price, no later than 10:00 a.m. (New York City time) on the Call
Date.
(iv) The Warrant Holder may not exercise the Call Warrants at
any time when such Warrant Holder is insolvent, and such Warrant
Holder shall be required to certify that it is solvent at the time
of exercise, by completing the form of subscription ("Form of
Subscription") attached to the Call Warrants and delivering such
completed Form of Subscription to the Trustee on or prior to the
Call Date and by delivering to the Trustee a form reasonably
satisfactory to the Trustee of the solvency certificate required
pursuant to Section 7(d)(ii) of the Series Supplement.
(v) The Warrant Holder shall have satisfied any other
conditions to the exercise of Call Warrants set forth in Section
7(d) of the Series Supplement.
(b) Upon exercise of Call Warrants, any Warrant Holder other than
the Depositor or any Affiliate of the Depositor shall be entitled to
delivery by the Trustee of the Called Certificates. The "Called
Certificates" shall be, in the case of the Class A-1 Certificates, Class
A-1 Certificates having a Certificate Principal Balance equal to $25 per
Call Warrant, and in the case of the Class A-2 Certificates, Class A-2
Certificates having an Initial Amortizing Notional Balance equal to
$1,000 per Call Warrant. Unless otherwise specified therein, each Call
Notice shall be deemed to be notice of an Optional Exchange pursuant to
Section 7(b) of the Series Supplement. Any Warrant Holder which is the
Depositor or any Affiliate of the Depositor shall receive the proceeds of
the sale of the Called Underlying Securities and shall not be entitled to
receive the related Called Certificates or Called Underlying Securities.
"Called Underlying Securities" are Underlying Securities which represent
the same percentage of the Underlying Securities as the Called
Certificates represent of the Class A-1 Certificates and the Class A-2
Certificates.
(c) The Warrant Agent shall notify the Trustee immediately upon its
receipt of a Call Notice and upon receipt of payment of the Call Price.
The Warrant Agent shall transfer the amount of any paid Call Price to the
Trustee in immediately available funds, for deposit in the Certificate
Account and application pursuant to the Trust Agreement on the applicable
Call Date (and, pending such transfer, shall hold such amount for the
benefit of the Warrant Holder in a segregated trust account).
(d) Delivery of a Call Notice does not give rise to an obligation on
the part of the Warrant Holder to pay the Call Price. If, by 10:00 a.m.
(New York City time) on the Call Date, the Warrant Holder has not paid
the Call Price, except in connection with a Call Notice relating to a
tender offer for or redemption of Underlying Securities, then the Call
Notice shall automatically expire and none of the Warrant Holder, the
Warrant Agent or the Trustee shall have any obligation with respect to
the Call Notice. The
B-2
expiration of a Call Notice shall in no way affect the Warrant Xxxxxx's
right to deliver a Call Notice at a later date. The Call Price for a call
in connection with a tender offer or redemption shall be deducted from
the proceeds of a tender offer or a redemption by the Trust pursuant to
Section 7(g)(iii) or Section 7(h)(iii), as applicable, of the Series
Supplement.
Section 1.2 Transfer of Certificates. As soon as practicable after each
surrender of Call Warrants in whole or in part on the Call Date and upon
satisfaction of all other requirements described in the Call Warrants and in
Section 1.1 hereof, the Warrant Agent shall instruct the Trustee as follows:
(a) if Call Warrants are being exercised by any Warrant Holder other
than the Depositor or any Affiliate of the Depositor, to cause the Called
Certificates to reflect the Warrant Holder's beneficial ownership of such
Certificates and if such Call Notice is also deemed to be a notice of
Optional Exchange, to cause a distribution of Underlying Securities to
the Warrant Holder in accordance with Section 7(a) of the Series
Supplement, provided, however, that if such Call Notice and Optional
Exchange is in connection with a tender offer or a redemption, the
Warrant Agent shall instruct the Trustee to distribute to the exercising
Warrant Holder the excess of the tender offer or redemption proceeds over
the Call Price pursuant to Section 7(g)(iii) or Section 7(h)(iii), as
applicable, of the Series Supplement, or
(b) if the Call Warrants are being exercised by the Depositor or any
Affiliate of the Depositor, to cause the Called Underlying Securities to
be sold pursuant to Section 13 of the Series Supplement and to distribute
the proceeds of such sale to the Warrant Holder.
If such exercise is in part only, the Warrant Agent shall (i) in the
case of a Global Call Warrant, cause the Registered Warrant Amount to be
decreased to reflect the outstanding Call Warrants of the Warrant Holder and
(ii) in the case of a Certificated Call Warrant, instruct the Trustee to
authenticate new Call Warrants of like tenor, representing the outstanding
Call Warrants of the Warrant Holder, and the Warrant Agent shall deliver such
Call Warrants to the Warrant Holder.
In each case, the Trustee shall act in accordance with such
instructions.
Section 1.3 Cancellation and Destruction of Call Warrants. All Call
Warrants surrendered to the Warrant Agent for the purpose of exercise (in
whole or in part) pursuant to Section 1.1 and actually exercised, or for the
purpose of transfer or exchange pursuant to Article IV, shall be cancelled by
the Warrant Agent, and no Call Warrant (other than that reflecting any such
transfer or exchange) shall be issued in lieu thereof. The Warrant Agent shall
destroy all cancelled Call Warrants.
Section 1.4 No Rights as Holder of Certificates Conferred by Call
Warrants. Prior to the exercise thereof, Call Warrants shall not entitle the
Warrant Holder to any of the rights of a holder of the Certificates,
including, without limitation, the right to receive the payment of any
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amount on or in respect of the Certificates or to enforce any of the
covenants of the Trust Agreement.
Section 1.5 Pro Rata Reduction of Call Warrants if Partial
Redemption of Underlying Securities. If Underlying Securities are redeemed in
part by the Underlying Securities Issuer and the Warrant Holders do not
exercise their Call Rights in connection with such partial redemption, the
Warrant Amount or Registered Warrant Amount, as the case may be, held by each
Warrant Holder shall be reduced proportionately so that the aggregate amount
of Class A-1 Certificates callable by Call Warrants shall equal the amount of
outstanding Class A-1 Certificates after giving effect to such partial
redemption and the aggregate amount of Class A-2 Certificates callable by Call
Warrants shall equal the outstanding amount of Class A-2 Certificates after
giving effect to such partial redemption. The Warrant Agent shall make such
adjustments to its records as shall be necessary to reflect such reductions
and shall notify the Depository or each Warrant Holder, as the case may be, of
such adjustments.
ARTICLE II
THE CALL WARRANTS
Section 2.1 The Call Warrants.
(a) The Class A-1 Call Warrants shall consist initially of 1,200,000
Call Warrants, each relating to $25 principal amount of Class A-1
Certificates. The Class A-2 Call Warrants shall consist initially of 162
Call Warrants, each relating to $25 Initial Amortizing Notional Balance
of Class A-2 Certificates.
(b) The Call Warrants shall initially be issued as one or more
Global Call Warrants in definitive, fully registered form without
coupons, and DTC shall be the Depository. Upon issuance, the Global Call
Warrants shall initially be deposited with the Trustee in its capacity as
custodian on behalf of DTC. Such Global Call Warrants shall initially be
registered in the name of Cede & Co. or another nominee designated by
DTC. Global Call Warrants shall clear and settle in book-entry only form
through the facilities of the Depository. Unless and until it is
exchanged in whole or in part for Certificated Call Warrants, a Global
Call Warrant may not be transferred except as a whole by the Depository
for such Global Call Warrant to a nominee of such Depository, or by a
nominee of such Depository to such Depository or another nominee of such
Depository, or by such Depository or any such nominee to a successor of
such Depository or a nominee of such successor. The Registered Warrant
Amount of Call Warrants may from time to time be increased or decreased
by adjustments made on the records of the Trustee, as custodian for DTC
for such Global Call Warrant, as provided in this Section.
(c) The Warrant Agent shall register the transfer or exchange of any
Global Call Warrant without requiring any additional certification.
(d) Interests of beneficial owners in a Global Call Warrant may be
transferred in accordance with the rules and procedures of DTC and any
other applicable Depositories. In connection with any exchange of
beneficial ownership interests in a Global Call Warrant for Certificated
Call Warrants pursuant to Section 2.3, the Warrant
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Agent shall reflect on its books and records the date of such exchange
and a decrease in the Registered Warrant Amount of such Global Call
Warrant in an amount equal to the Warrant Amount of the beneficial
ownership interests in such Global Call Warrant being exchanged for
Certificated Call Warrants.
Section 2.2 Cancellation. All Call Warrants presented and surrendered for
payment, transfer or exchange shall be delivered to the Warrant Agent and
shall be promptly canceled by it. No Call Warrants shall be authenticated in
lieu of or in exchange for any Call Warrants canceled as provided in this
Section 2.2.
Section 2.3 Certificated Call Warrants. Any Global Call Warrant
representing Call Warrants shall be exchangeable for Certificated Call
Warrants only if (i) the Depository advises the Depositor in writing that it
is no longer willing or able to properly discharge its responsibilities with
respect to the Call Warrants and the Depositor is unable to locate a qualified
successor within 60 calendar days or (ii) the Depositor, at its option,
advises the Trustee in writing that it elects to terminate the book-entry
system through the Depository. Any Global Call Warrant that is exchangeable
pursuant to the preceding sentence will be exchangeable for Certificated Call
Warrants of like tenor and Warrant Amount, as applicable, in any authorized
denomination or denominations and registered in the names of such Person or
Persons as the Depository shall direct. Upon such exchange, the Warrant Agent
shall execute and authenticate such Certificated Call Warrants and register
the same in the name of, and deliver the same to, such Person or Persons
consistent with the provisions hereof.
ARTICLE III
RESTRICTIONS ON TRANSFER
Section 3.1 Restrictive Legends. Except as otherwise permitted by this
Article III, each Call Warrant (including each Call Warrant issued upon the
transfer of any Call Warrant) shall be issued with a legend in substantially
the following form:
"THIS CALL WARRANT (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE TRANSFERRED, SOLD OR
OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION UNDER SUCH ACT IS IN
EFFECT OR PURSUANT TO AN EXEMPTION THEREFROM UNDER SUCH ACT. THE CALL
WARRANT REPRESENTED HEREBY MAY BE TRANSFERRED ONLY IN COMPLIANCE WITH THE
CONDITIONS SPECIFIED IN THE CALL WARRANTS.
EACH PURCHASER OF THIS CALL WARRANT IS HEREBY NOTIFIED THAT THE SELLER OF
THIS CALL WARRANT MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF
SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER."
Section 3.2 Notice of Proposed Transfer. Prior to any transfer of any
Certificated Call Warrant or portion thereof, the Warrant Holder will give
five (5) Business Days (or such lesser period acceptable to the Warrant Agent)
prior written notice to the Warrant Agent of such Warrant Xxxxxx's intention
to effect such transfer.
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ARTICLE IV
REGISTRATION AND TRANSFER OF CALL WARRANTS, ETC.
Section 4.1 Warrant Register; Ownership of Call Warrants. The Warrant
Agent will keep a register in which the Warrant Agent will provide for the
registration of Call Warrants and the registration of transfers of Call
Warrants representing numbers of Call Warrants. Prior to due presentment of a
Call Warrant for registration of transfer, the Depositor, the Trustee, the
Warrant Agent and any agent of the Depositor, the Trustee or the Warrant Agent
may treat the Person in whose name any Call Warrant is registered as the owner
of such Call Warrant for any purposes whatsoever, and none of the Depositor,
the Trustee, the Warrant Agent or any agent of the Depositor, the Trustee or
the Warrant Agent shall be affected by notice to the contrary.
None of the Depositor, the Trustee, the Warrant Agent or any agent
of the Depositor, the Trustee or the Warrant Agent shall have any
responsibility or liability for any aspect of the records relating to, or
payments made on account of, beneficial ownership interests of a Global Call
Warrant or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
Notwithstanding the foregoing, with respect to any Global Call
Warrant, nothing herein shall prevent the Depositor, the Trustee, the Warrant
Agent or any agent of the Depositor, the Trustee or the Warrant Agent from
giving effect to any written certification, proxy or other authorization
furnished by any Depository, as a Warrant Holder, with respect to such Global
Call Warrant or impair, as between such Depository and owners of beneficial
interests in such Global Call Warrant, the operation of customary practices
governing the exercise of the rights of such Depository (or its nominee) as
Warrant Holder of such Global Call Warrant.
Section 4.2 Transfer and Exchange of Call Warrants. (a) No Call Warrant
or any beneficial interest therein may be offered, resold, assigned or
otherwise transferred (including by pledge or hypothecation) unless such
offer, resale, assignment or transfer is to a qualified institutional buyer (a
"QIB"), as such term is defined in Rule 144A promulgated under the Securities
Act ("Rule 144A"), in accordance with Rule 144A, and in accordance with any
applicable securities laws of any state of the United States and other
jurisdictions. Prior to any offer, resale, assignment or transfer of any
Certificated Call Warrant, the prospective transferee and the prospective
transferor shall be required to deliver to the Trustee an executed copy of an
Investment Letter with respect to the Certificated Call Warrants to be
transferred substantially in the form of Exhibit A hereto. In addition to the
foregoing, each prospective transferee of any Certificated Call Warrants shall
acknowledge, represent and agree (and each prospective transferee of any
beneficial interest in a Global Call Warrant shall be deemed to acknowledge,
represent and agree) as follows:
1. The transferee (x) is a QIB, (y) is aware that the sale to it is
being made in reliance on Rule 144A and (z) is acquiring such Call
Warrants for its own account or for the account of a QIB.
2. The transferee understands that the Call Warrants are being offered
in a transaction not involving any public offering in the United
States within the
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meaning of the Securities Act, and that the Call Warrants have not
been and will not be registered under the Securities Act.
3. The transferee agrees that (A) if in the future it decides to offer,
resell, pledge or otherwise transfer the Call Warrants prior to the
Resale Restriction Termination Date, such Call Warrants shall only
be offered, resold, assigned or otherwise transferred to a QIB, in
accordance with Rule 144A, and in accordance with any applicable
securities laws of any state of the United States and other
jurisdictions and (B) the transferee will, and each subsequent
holder is required to, notify any subsequent purchaser of such Call
Warrants from it of the resale restrictions referred to in clause
(A) above.
(b) Upon surrender of any Certificated Call Warrant for registration
of transfer or for exchange to the Warrant Agent, the Warrant Agent shall
(subject to compliance with Article III) promptly execute and deliver,
and cause the Trustee, on behalf of the Trust, to execute and deliver, in
exchange therefor, a new Certificated Call Warrant of like tenor and
evidencing a like number of Call Warrants, in the name of such Warrant
Holder or as such Warrant Holder (upon payment by such Warrant Holder of
any applicable transfer taxes or government charges) may direct; provided
that as a condition precedent for transferring the Call Warrants, the
prospective transferee shall deliver to the Trustee and the Depositor an
executed copy of the Investment Letter (set forth as Exhibit A hereto) if
the same is required pursuant to the provisions of clause (a) above.
Section 4.3 Replacement of Call Warrants. Upon receipt of evidence
reasonably satisfactory to the Warrant Agent of the loss, theft, destruction
or mutilation of any Call Warrant and, in the case of any such loss, theft or
destruction of any Call Warrant, upon delivery of an indemnity bond in such
reasonable amount as the Warrant Agent may determine, or, in the case of any
such mutilation, upon the surrender of such Call Warrant for cancellation to
the Warrant Agent, the Warrant Agent shall execute and deliver, and cause the
Trustee, on behalf of the Trust, to execute and deliver, in lieu thereof, a
new Call Warrant of like tenor bearing a number not contemporaneously
outstanding.
Section 4.4 Execution and Delivery of Call Warrants by Trustee. The
Trustee, on behalf of the Trust, hereby agrees (subject to compliance with
Article III) to execute and deliver such new Call Warrants issued in
accordance with Section 1.2 or this Article IV as the Warrant Agent shall
request in accordance herewith.
Section 4.5 Additional Call Warrants. The Trustee shall execute and deliver,
in a manner consistent with Article II hereof, additional Call Warrants on
behalf of the Trust with respect to any additional Certificates issued by the
Trust following the sale of additional Underlying Securities to the Trust, in
accordance with the provisions of Section 3(d) of the Series Supplement.
ARTICLE V
DEFINITIONS
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As used herein, unless the context otherwise requires, the following
terms have the following respective meanings:
"Business Day": As defined in the Trust Agreement.
"Call Date": Any Business Day (i) on or after April 30, 2009, (ii)
after the Underlying Securities Issuer announces that it will redeem, prepay
or otherwise make an unscheduled payment on the Underlying Securities, (iii)
after the Trustee notifies the Certificateholders of any proposed sale of the
Underlying Securities pursuant to the provisions of the Series Supplement or
(iv) on which the Underlying Securities Issuer or an affiliate thereof
consummates a tender offer for some or all of the Underlying Securities.
"Call Notice": As defined in Section 1.1(a)(i) hereof.
"Call Price": For each related Call Date, (i) in the case of the
Class A-1 Certificates, the sum of 100% of the outstanding Certificate
Principal Balance of the Class A-1 Certificates being purchased pursuant to
the exercise of the Call Warrants, plus any accrued and unpaid interest on
such amount to, but excluding, the Call Date and (ii) in the case of the Class
A-2 Certificates, the Amortizing Notional Balance of the Class A-2
Certificates being purchased pursuant to the exercise of the Call Warrants,
plus any accrued and unpaid interest on such amount to, but excluding, the
Call Date.
"Call Warrant": As defined in the recitals.
"Called Certificates": As defined in Section 1.1(b) hereof.
"Called Underlying Securities": As defined in Section 1.1(b) hereof.
"Certificated Call Warrant": Any Call Warrant in definitive,
physical form registered in the name of a Person other than the Depository or
its nominee.
"Closing Date": April 30, 2004.
"Depositor": As defined in the recitals.
"Depositor Order": As defined in the Trust Agreement.
"Depository": DTC initially, or such other depository appointed by
the Depositor.
"DTC": The Depository Trust Company, a limited purpose trust company
organized under the laws of the State of New York, and any of its successors
or assigns.
"Global Call Warrant": A registered Call Warrant in the name of the
Depository or its nominee.
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"Person": Any individual, corporation, partnership, joint venture,
association, joint stock company, trust (including any beneficiary thereof),
unincorporated organization or government or any agency or political
subdivision thereof.
"QIB": As defined in Section 4.2 hereof.
"Rating Agencies": Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies, Inc. and Xxxxx'x Investors Service and any of their
respective successors.
"Registered Warrant Amount": The Warrant Amount represented by the
Global Call Warrants.
"Responsible Officer": As defined in the Trust Agreement.
"Rule 144A": As defined in Section 4.2.
"Securities Act": The Securities Act of 1933, or any similar federal
statute, and the rules and regulations of the Commission thereunder, all as
the same shall be in effect at the time.
"Trust": As defined in the recitals.
"Trust Agreement": As defined in the recitals.
"Trustee": As defined in the recitals, or any successor thereto
under the Trust Agreement.
"Warrant Agent": As defined in the recitals, or any successor
thereto under this Warrant Agent Agreement.
"Warrant Agent Agreement": As defined in the recitals.
"Warrant Amount": With respect to any Warrant Holder, the number of
Call Warrants relating to Class A-1 Certificates and Call Warrants relating to
the Class A-2 Certificates, held by such Warrant Holder.
"Warrant Holder": As defined in Section 1.1(a) hereof.
ARTICLE VI
WARRANT AGENT
Section 6.1 Limitation on Liability. The Warrant Agent shall be protected
and shall incur no liability for or in respect of any action taken, suffered
or omitted by it in connection with its administration of the Call Warrants in
reliance upon any instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent, certificate,
statement or other paper or document in good faith believed by it to be
genuine and to be signed, executed and, where necessary, verified and
acknowledged, by the proper Person or Persons.
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Section 6.2 Duties of Warrant Agent. The Warrant Agent undertakes only
the specific duties and obligations imposed hereunder upon the following terms
and conditions, by all of which the Depositor, the Trust, the Trustee and each
Warrant Holder shall be bound:
(a) The Warrant Agent may consult with legal counsel (who may be
legal counsel for the Depositor), and the opinion of such counsel shall
be full and complete authorization and protection to the Warrant Agent as
to any action taken or omitted by it in good faith and in accordance with
such opinion, provided the Warrant Agent shall have exercised reasonable
care in the selection by it of such counsel.
(b) Whenever in the performance of its duties hereunder, the Warrant
Agent shall deem it necessary or desirable that any fact or matter be
proved or established by the Depositor or the Trustee prior to taking or
suffering any action hereunder, such fact or matter may be deemed to be
conclusively proved and established by a Depositor Order or a certificate
signed by a Responsible Officer of the Trustee and delivered to the
Warrant Agent; and such certificate shall be full authorization to the
Warrant Agent for any action taken or suffered in good faith by it
hereunder in reliance upon such certificate.
(c) The Warrant Agent shall be liable hereunder only for its own
negligence, willful misconduct or bad faith.
(d) The Warrant Agent shall not be liable for or by reason of any of
the statements of fact or recitals contained herein or be required to
verify the same, but all such statements and recitals are and shall be
deemed to have been made by the Trust and the Depositor only.
(e) The Warrant Agent shall not have any responsibility in respect
of and makes no representation as to the validity of the Call Warrants or
the execution and delivery thereof (except the due execution hereof by
the Warrant Agent); nor shall it be responsible for any breach by the
Trust of any covenant or condition contained in the Call Warrants; nor
shall it by any act thereunder be deemed to make any representation or
warranty as to the Certificates to be purchased thereunder.
(f) The Warrant Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from
the Chairman of the Board, the Chief Executive Officer, Chief Financial
Officer, Chief Operating Officer, President, a Vice President, a Senior
Vice President, a Managing Director, its Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary of the Depositor, and
any Responsible Officer of the Trustee, and to apply to such officers for
advice or instructions in connection with its duties, and it shall not be
liable for any action taken or suffered to be taken by it in good faith
in accordance with instructions of any such officer.
(g) The Warrant Agent and any shareholder, director, officer or
employee of the Warrant Agent may buy, sell or deal in any of the Call
Warrants or other securities of the Trust or otherwise act as fully and
freely as though it were not Warrant Agent hereunder, so long as such
persons do so in full compliance with all applicable laws.
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Nothing herein shall preclude the Warrant Agent from acting in any other
capacity for the Trust, the Depositor or for any other legal entity.
(h) The Warrant Agent may execute and exercise any of the rights or
powers hereby vested in it or perform any duty hereunder either itself or
by or through its attorneys or agents.
(i) The Warrant Agent shall act solely as the agent of the Trust
hereunder. The Warrant Agent shall not be liable except for the failure
to perform such duties as are specifically set forth herein, and no
implied covenants or obligations shall be read into the Call Warrants
against the Warrant Agent, whose duties shall be determined solely by the
express provisions thereof. The Warrant Agent shall not be deemed to be a
fiduciary.
(j) The Warrant Agent shall not be responsible for any failure on
the part of the Trustee to comply with any of its covenants and
obligations contained herein.
(k) The Warrant Agent shall not be under any obligation or duty to
institute, appear in or defend any action, suit or legal proceeding in
respect hereof, unless first indemnified to its satisfaction, but this
provision shall not affect the power of the Warrant Agent to take such
action as the Warrant Agent may consider proper, whether with or without
such indemnity. The Warrant Agent shall promptly notify the Depositor and
the Trustee in writing of any claim made or action, suit or proceeding
instituted against it arising out of or in connection with the Call
Warrants.
(l) The Trustee will perform, execute, acknowledge and deliver or
cause to be performed, executed, acknowledged and delivered all such
further acts, instruments and assurances as may be required by the
Warrant Agent in order to enable it to carry out or perform its duties
hereunder.
(m) Upon request of a Warrant Holder, the Warrant Agent shall
furnish to such Warrant Holder and/or a prospective purchaser designated
by such Warrant Holder the information required to be delivered under
Rule 144A(d)(4) under the Securities Act, to the extent that such
information is in the possession of the Warrant Agent.
Section 6.3 Change of Warrant Agent. The Warrant Agent may resign and be
discharged from its duties hereunder upon thirty (30) days notice in writing
mailed to the Depositor and the Trustee by registered or certified mail, and
to the Warrant Holders by first-class mail at the expense of the Depositor;
provided that no such resignation or discharge shall become effective until a
successor Warrant Agent shall have been appointed hereunder. The Depositor may
remove the Warrant Agent or any successor Warrant Agent upon thirty (30) days
notice in writing, mailed to the Warrant Agent or successor Warrant Agent, as
the case may be, and to the Warrant Holders by first-class mail; provided
further that no such removal shall become effective until a successor Warrant
Agent shall have been appointed hereunder. If the Warrant Agent shall resign
or be removed or shall otherwise become incapable of acting, the Depositor
shall promptly appoint a successor to the Warrant Agent, which may be
designated as an interim Warrant Agent. If an interim Warrant Agent is
designated, the Depositor shall then appoint a permanent successor to the
Warrant Agent, which may be the interim Warrant Agent.
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If the Depositor shall fail to make such appointment of a permanent successor
within a period of thirty (30) days after such removal or within sixty (60)
days after notification in writing of such resignation or incapacity by the
resigning or incapacitated Warrant Agent or by the Warrant Holder, then the
Warrant Agent or registered Warrant Holder may apply to any court of competent
jurisdiction for the appointment of such a successor. Any successor to the
Warrant Agent appointed hereunder must be rated in one of the four highest
rating categories by the Rating Agencies. Any entity which may be merged or
consolidated with or which shall otherwise succeed to substantially all of the
trust or agency business of the Warrant Agent shall be deemed to be the
successor Warrant Agent without any further action.
Section 6.4 Warrant Agent Transfer Fee. The Warrant Agent will
assess a fee of $50.00 upon the issue of any new Call Warrant, such fee to be
assessed upon the new Warrant Holder.
ARTICLE VII
MISCELLANEOUS
Section 7.1 Remedies. The remedies at law of the Warrant Holder in the
event of any default or threatened default by the Warrant Agent in the
performance of or compliance with any of the terms of the Call Warrants are
not and will not be adequate and, to the full extent permitted by law, such
terms may be specifically enforced by a decree for the specific performance of
any agreement contained herein or by an injunction against a violation of any
of the terms thereof or otherwise.
Section 7.2 Limitation on Liabilities of Warrant Holder. Nothing
contained in this Warrant Agent Agreement shall be construed as imposing any
obligation on the Warrant Holder to purchase any of the Certificates except in
accordance with the terms thereof.
Section 7.3 Notices. All notices and other communications under this
Warrant Agent Agreement shall be in writing and shall be delivered, or mailed
by registered or certified mail, return receipt requested, by a nationally
recognized overnight courier, postage prepaid, addressed (a) if to any Warrant
Holder, at the registered address of such Warrant Holder as set forth in the
register kept by the Warrant Agent or (b) if to the Warrant Agent, to 000 Xxxx
Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate Trust or to
such other address notice of which the Warrant Agent shall have given to the
Warrant Holder and the Trustee or (c) if to the Trust or the Trustee, to the
Corporate Trust Office (as set forth in the Trust Agreement); provided that
the exercise of any Call Warrants shall be effective in the manner provided in
Article I. The Warrant Agent shall forward to the Warrant Holder any notices
received by it hereunder or pursuant to the Trust Agreement or this Agreement
by facsimile within one Business Day of receipt thereof.
Section 7.4 Amendment. (a) This Warrant Agent Agreement may be amended
from time to time by the Depositor, the Trustee and the Warrant Agent without
the consent of any Warrant Holder, upon receipt of an opinion of counsel
satisfactory to the Warrant Agent that the provisions hereof have been
satisfied and that such amendment would not cause the Trust to be taxed as an
association or publicly traded partnership taxable as a Corporation under the
Code,
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for any of the following purposes: (i) to cure any ambiguity or to correct or
supplement any provision herein which may be defective or inconsistent with
any other provision herein or to provide for any other terms or modify any
other provisions with respect to matters or questions arising under the Call
Warrant which shall not adversely affect in any material respect the interests
of the Warrant Holder or any holder of a Certificate; provided, however, that
no amendment altering the timing or amount of any payment of the Call Price
shall be effected without the consent of each Warrant Holder; or (ii) to
evidence and provide for the acceptance of appointment hereunder of a Warrant
Agent other than U.S. Bank Trust National Association.
(b) Without limiting the generality of the foregoing, the Call
Warrants may also be modified or amended from time to time by the
Depositor, the Trustee and the Warrant Agent with the consent of Warrant
Holders of 66-2/3% of each of the Call Warrants related to the Class A-1
Certificates and the Call Warrants related to the Class A-2 Certificates,
upon receipt of an opinion of counsel satisfactory to the Warrant Agent
that the provisions hereof (including, without limitation, the following
proviso) have been satisfied, for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of the
Call Warrants or of modifying in any manner the rights of the Warrant
Holders; provided, however, that no such amendment shall (i) adversely
affect in any material respect the interests of holders of Certificates
without the consent of the holders of Certificates evidencing not less
than the Required Percentage--Amendment of the aggregate Voting Rights of
such affected Certificates (as such terms are defined in the Trust
Agreement) and without written confirmation from the Rating Agencies that
such amendment will not result in a downgrading or withdrawal of its
rating of the Certificates; (ii) alter the terms on which Call Warrants
are exercisable or the amounts payable upon exercise of a Warrant without
the consent of the holders of Certificates evidencing not less than 100%
of the aggregate Voting Rights of such affected Certificates and 100% of
the affected Warrant Holders or (iii) reduce the percentage of aggregate
Voting Rights required by (i) or (ii) without the consent of the holders
of all such affected Certificates. Notwithstanding any other provision of
this Warrant Agent Agreement, this Section 7.4(b) shall not be amended
without the consent of 100% of the affected Warrant Holders.
(c) Promptly after the execution of any such amendment or
modification, the Warrant Agent shall furnish a copy of such amendment or
modification to each Warrant Holder, to the Trustee and to the Rating
Agencies. It shall not be necessary for the consent of Warrant Holders or
holders of Certificates under this Section to approve the particular form
of any proposed amendment, but it shall be sufficient if such consent
shall approve the substance thereof. The manner of obtaining such
consents and of evidencing the authorization of the execution thereof
shall be subject to such reasonable regulations as the Warrant Agent may
prescribe.
Section 7.5 Expiration. The right to exercise the Call Warrants shall
expire on the earliest to occur of (a) the cancellation thereof, (b) the
termination of the Trust Agreement, or (c) the liquidation, disposition, or
maturity of all of the Underlying Securities.
Section 7.6 Descriptive Headings. The headings in this Warrant Agent
Agreement are for purposes of reference only and shall not limit or otherwise
affect the meaning hereof.
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Section 7.7 GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE
LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF
LAWS.
Section 7.8 Judicial Proceedings; Waiver of Jury. Any judicial proceeding
brought against the Trust, the Trustee or the Warrant Agent with respect to
this Warrant Agent Agreement may be brought in any court of competent
jurisdiction in the County of New York, State of New York or of the United
States of America for the Southern District of New York and, by execution and
delivery of the Call Warrants, the Trustee on behalf of the Trust and the
Warrant Agent (a) accept, generally and unconditionally, the nonexclusive
jurisdiction of such courts and any related appellate court, and irrevocably
agree that the Trust, the Trustee and the Warrant Agent shall be bound by any
judgment rendered thereby in connection with this Warrant Agent Agreement or
the Call Warrants, subject to any rights of appeal, and (b) irrevocably waive
any objection that the Trust, the Trustee or the Warrant Agent may now or
hereafter have as to the venue of any such suit, action or proceeding brought
in such a court or that such court is an inconvenient forum.
Section 7.9 Nonpetition Covenant; No Recourse. Each of (i) the Warrant
Holder by its acceptance thereof, and (ii) the Warrant Agent agrees, that it
shall not (and, in the case of the Warrant Holder, that it shall not direct
the Warrant Agent to), until the date which is one year and one day after the
payment in full of the Certificates and all other securities issued by the
Trust, the Depositor or entities formed, established or settled by the
Depositor, acquiesce, petition or otherwise invoke or cause the Trust, the
Depositor, or any such other entity to invoke the process of the United States
of America, any State or other political subdivision thereof or any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government for the purpose of commencing or
sustaining a case by or against the Trust, the Depositor or any such other
entity under a federal or state bankruptcy, insolvency or similar law or
appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator
or other similar official of the Trust, the Depositor or any such other entity
or all or any part of the property or assets of Trust, the Depositor or any
such other entity or ordering the winding up or liquidation of the affairs of
the Trust, the Depositor or any such other entity.
IN WITNESS WHEREOF, the parties hereto have caused their names to
be signed hereto by their respective duly authorized officers as of the date
first above written.
XXXXXX ABS CORPORATION,
as Depositor
By:______________________________
Name:
Title:
U.S. BANK TRUST NATIONAL
ASSOCIATION,
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not in its individual capacity but
solely as Trustee and
Authenticating Agent
By:_________________________________
Name:
Title:
U.S. BANK TRUST NATIONAL
ASSOCIATION,
as Warrant Agent
By:_________________________________
Name:
Title:
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EXHIBIT A
FORM OF INVESTMENT LETTER
QUALIFIED INSTITUTIONAL BUYER
Dated: ___________ __, _____
U.S. Bank Trust National Association,
as Trustee
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx ABS Corporation,
as Depositor
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Corporate Backed Trust Certificates, Xxxxxxx Xxxxx Capital I
Securities-Backed Series 2004-7
-------------------------------------------------------------
Ladies and Gentlemen:
In connection with its proposed purchase of Call Warrants (the
"Call Warrants") which represent the right to call $______________ aggregate
certificate principal balance of Corporate Backed Trust Certificates, Xxxxxxx
Xxxxx Capital I Securities-Backed Series 2004-7 Class A-1 Certificates and
$_______________ aggregate amortizing notional balance of Corporate Backed
Trust Certificates, Xxxxxxx Xxxxx Capital I Securities-Backed Series 2004-7
Class A-2 Certificates, the undersigned purchaser (the "Purchaser") confirms
that:
1. The Purchaser understands that substantial risks are involved in an
investment in the Call Warrants. The Purchaser represents that in making its
investment decision to acquire the Call Warrants, the Purchaser has not relied
on representations, warranties, opinions, projections, financial or other
information or analysis, if any, supplied to it by any person, including you,
Xxxxxx ABS Corporation, as depositor (the "Depositor"), or U.S. Bank Trust
National Association, as trustee (the "Trustee"), or any of your or their
affiliates, except as expressly contained in written information, if any. The
Purchaser has such knowledge and experience in financial and business matters
as to be capable of evaluating the merits and risks of an investment in the
Call Warrants, and the Purchaser is able to bear the substantial economic
risks of such an investment. The Purchaser has relied upon its own tax, legal
and financial advisors in connection with its decision to purchase the Call
Warrants.
2. The Purchaser (A) is a "Qualified Institutional Buyer" (as defined in
Rule 144A under the Securities Act of 1933, as amended (the "1933 Act")) and
(B) is acquiring the Call Warrants for its own account or for the account of
an investor of the type described in clause (A) above as to each of which the
Purchaser exercises sole investment discretion. The Purchaser is purchasing
the Call Warrants for investment purposes and not with a view to, or for, the
offer or
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sale in connection with, a public distribution or in any other manner that
would violate the 1933 Act or the securities or blue sky laws of any state.
3. The Purchaser understands that the Call Warrants have not been and
will not be registered under the 1933 Act or under the securities or blue sky
laws of any state, and that (i) if it decides to resell, pledge or otherwise
transfer any Security, such resale, pledge or other transfer must comply with
the provisions of the Warrant Agent Agreement relating to the Call Warrants
(including, without limitation, the provisions of Section 4.2 thereof) and
(ii) it will, and each subsequent holder will be required to, notify any
purchaser of any Security from it of the resale restrictions referred to in
clause (i) above.
4. The Purchaser understands that each of the Call Warrants will bear a
legend substantially to the following effect, unless otherwise agreed by the
Depositor and the Trustee:
"THIS CALL WARRANT (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A
REGISTRATION UNDER SUCH ACT IS IN EFFECT OR PURSUANT TO AN
EXEMPTION THEREFROM UNDER SUCH ACT. THE CALL WARRANT REPRESENTED
HEREBY MAY BE TRANSFERRED ONLY IN COMPLIANCE WITH THE CONDITIONS
SPECIFIED HEREIN OR IN THE SERIES SUPPLEMENT.
EACH PURCHASER OF THIS CALL WARRANT IS HEREBY NOTIFIED THAT THE
SELLER OF THIS CALL WARRANT MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE
144A THEREUNDER."
5. The Purchaser understands that no subsequent transfer of the Call
Warrants is permitted unless (A) such transfer is of a Call Warrant with the
applicable minimum denomination and (B) the Purchaser causes the proposed
transferee to provide to the Depositor and the Trustee such documentation as
may be required pursuant to Section 4.2 of the Warrant Agent Agreement,
including, if required, a letter substantially in the form hereof, or such
other written statement as the Depositor shall reasonably prescribe.
6. The Purchaser is a person or entity (a "Person") who is either
A. (1) a citizen or resident of the United States, (2) a
corporation, partnership or other entity organized in or under the laws
of the United States or any political subdivision thereof, or (3) an
estate the income of which is includible in gross income for federal
income tax purposes regardless of source, or (4) a trust if a court
within the United States is able to exercise primary supervision of the
administration of the trust and one or more United States persons have
the authority to control all substantial decisions of the trust, or
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B. a Person not described in (A), whose ownership of such Call
Warrant is effectively connected with such Person's conduct of a trade or
business within the United States within the meaning of the Internal
Revenue Code of 1986, as amended (the "Code"), and its ownership of any
interest in such Call Warrant will not result in any withholding
obligation with respect to any payments with respect to the Call Warrants
by any Person (other than withholding, if any, under Section 1446 of the
Code), or
C. a Person not described in (A) or (B) above, who is not a Person:
(1) that owns, directly or indirectly, 10% or more of the total combined
voting power of all classes of stock in the Underlying Securities Issuer
(as defined in the Prospectus Supplement) entitled to vote, (2) that is a
controlled foreign corporation related to the Underlying Securities
Issuer within the meaning of Section 864(d)(4) of the Code, or (3) that
is a bank extending credit pursuant to a loan agreement entered into in
the ordinary course of its trade or business.
7. The Purchaser agrees that (I) if it is a Person described in clause
(A) above, it will furnish to the Depositor and the Trustee a properly
executed IRS Form W-9, and (II) if it is a Person described in clause (B)
above, it will furnish to the Depositor and the Trustee a properly executed
IRS Form W-8ECI, and (III) if it is a Person described in clause (C) above, it
will furnish to the Depositor and the Trustee a properly executed IRS Form
W-8BEN (or, if the Purchaser is treated as a partnership for federal income
tax purposes, a properly executed IRS Form W-8IMY with appropriate
certification for all partners or members attached). The Purchaser also agrees
that it will provide a new IRS form upon the expiration or obsolescence of any
previously delivered form, and that it will provide such other certifications,
representations or Opinions of Counsel as may be requested by the Depositor
and the Trustee.
8. The Purchaser agrees that if at some time in the future it wishes to
transfer or exchange any of the Call Warrants, it will not transfer or
exchange any of the Call Warrants unless such transfer or exchange is in
accordance with the terms of the Warrant Agent Agreement, Series Supplement
and other documents applicable to the Call Warrant. The Purchaser understands
that any purported transfer of the Call Warrants (or any interest therein) in
contravention of any of the restrictions and conditions in the agreements, as
applicable, shall be void, and the purported transferee in such transfer shall
not be recognized by any Person as a holder of such Call Warrants, for any
purpose.
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You and the Trustee are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Very truly yours,
[Name of Purchaser]
By: ______________________________
Name: ____________________________
Title: ______________________________
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EXHIBIT C
FORM OF INVESTMENT LETTER
QUALIFIED INSTITUTIONAL BUYER AND ACCREDITED INVESTOR
Dated:
U.S. Bank Trust National Association,
as Trustee
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Brothers Inc.,
as Initial Purchaser
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx ABS Corporation,
as Depositor
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
In connection with our proposed purchase of $___________ aggregate
Amortizing Notional Balance of Class A-2 Certificates (the "Class A-2
Certificates") representing an interest in the Corporate Backed Trust
Certificates, Xxxxxxx Xxxxx Capital I Securities-Backed Series 2004-7 Trust
(the "Trust"), the undersigned, by executing this letter (the "Purchaser")
confirms that:
1. Reference is made to the private placement memorandum, dated April
30, 2004, including the schedules, exhibits and annexes, if any, thereto, as
supplemented or amended to the date hereof (the "Memorandum"), relating to the
Class A-2 Certificates. Capitalized terms used herein that are not otherwise
defined shall have the meanings ascribed thereto in the Memorandum. The
Purchaser has received a copy of the Memorandum and such other information as
the Purchaser deems necessary in order to make its investment decision and the
Purchaser has been provided the opportunity to ask questions of, and receive
answers from, the Depositor and the Initial Purchaser, concerning the terms
and conditions of the offering described in the Memorandum. The Purchaser has
received and understands the information discussed above and understands that
substantial risks are involved in an investment in the Class A-2 Certificates.
The Purchaser represents that, in making its investment decision to acquire
the Class A-2 Certificates, the Purchaser has not relied on representations,
warranties, opinions, projections, financial or other information or analysis,
if any, supplied to it by any person or entity, including the Initial
Purchaser, the Depositor or the Trustee or any of their affiliates, except as
expressly contained in the Memorandum and in the other written information, if
any, discussed above. The Purchaser acknowledges that it has read and agreed
to the matters stated
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on pages 2 through 4 of such Memorandum and the information under the heading
"Transfer Restrictions." The Purchaser is purchasing the Class A-2
Certificates for investment purposes and not with a view to, or for, the offer
or sale in connection with a public distribution or in any other manner that
would violate the Securities Act or the securities or blue sky laws of any
state of the United States. The Purchaser has such knowledge and experience in
financial and business matters as to be capable of evaluating the merits and
risks of purchasing any of the Class A-2 Certificates. The Purchaser is aware
that it may be required to bear the substantial economic risk of an investment
in the Class A-2 Certificates for an indefinite period of time and such
Purchaser is able to bear such risk for an indefinite period. The Purchaser
has relied upon its own tax, legal and financial advisors in connection with
its decision to purchase the Class A-2 Certificates.
2. The Purchaser is not an "affiliate" (as defined in Rule 144 under the
Securities Act) of the Depositor and is either:
(i) (A) a "Qualified Institutional Buyer" (a "QIB") (as defined in
Rule 144A under the Securities Act of 1933, as amended (the "Securities
Act" and "Rule 144A")) and has delivered to you the certification
contained herein as to the fact that it is a QIB and (B) acquiring the
Class A-2 Certificates for its own account, for the account of an
Accredited Investor (as defined in Rule 501(a) under the Securities
Act), or for the account of a QIB as to each of which the Purchaser
exercises sole investment discretion. The Purchaser is aware that the
Class A-2 Certificates are being sold to it in reliance on the exemption
from the provisions of Section 5 of the Securities Act provided by Rule
144A; or
(ii) an Accredited Investor and, if the Class A-2 Certificates are
to be purchased for one or more accounts ("investor accounts") for which
it is acting as fiduciary or agent, each such investor account is an
Accredited Investor on a like basis or a QIB; in the normal course of
its business, such Purchaser invests in or purchases securities similar
to the Class A-2 Certificates.
3. The Purchaser acknowledges that neither the Depositor nor the Initial
Purchaser, or any person representing the Depositor or the Initial Purchaser,
has made any representation to such purchaser with respect to the Trust, the
Underlying Securities or the offering or sale of any Class A-2 Certificates,
other than the information contained in the Memorandum, which has been
delivered to the Purchaser and upon which the Purchaser is relying in making
an investment decision with respect to the Class A-2 Certificates.
Accordingly, the Purchaser acknowledges that no representation or warranty is
made by the Depositor or the Initial Purchaser as to the accuracy or
completeness of such materials.
4. The Purchaser understands that the Class A-2 Certificates are being
offered in a transaction not involving any public offering in the United
States within the meaning of the Securities Act, that the Class A-2
Certificates have not been and will not be registered under the Securities Act
or under the securities or blue sky laws of any state, and that (i) if in the
future it decides to offer, resell, pledge or otherwise transfer the Class A-2
Certificates, such Class A-2 Certificates shall only be offered, resold,
assigned or otherwise transferred (A) to the Trust, (B) pursuant to an
effective registration statement under the Securities Act, (C) to a QIB, in
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accordance with Rule 144A or (D) to any person or entity (including an
Accredited Investor within the meaning of Rule 501(a) under the Securities
Act) pursuant to another available exemption from registration provided under
the Securities Act, and, in each of cases (A) through (D), in accordance with
any applicable securities laws of any state of the United States and other
jurisdictions and (ii) the purchaser will, and each subsequent holder is
required to, notify any subsequent purchaser of such Class A-2 Certificates
from it of the resale restrictions referred to in clause (i) above. Upon the
transfer of Class A-2 Certificates held in the form of global certificates to
an Accredited Investor, the transferor's interest in such global certificates
shall be exchanged for a Class A-2 Certificate in definitive form. Thereafter,
upon transfer of a definitive Class A-2 Certificate to a QIB, such Class A-2
Certificate may be exchanged for a beneficial interest in a global
certificate.
5. The Purchaser understands that each Class A-2 Certificate will,
unless otherwise agreed to by the Depositor and the Trustee, bear a legend
substantially to the following effect:
"THIS CLASS A-2 CERTIFICATE (OR ITS PREDECESSOR) HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY
NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A
REGISTRATION UNDER SUCH ACT IS IN EFFECT OR PURSUANT TO AN
EXEMPTION THEREFROM UNDER SUCH ACT. THE CLASS A-2 CERTIFICATE
REPRESENTED HEREBY MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE
TERMS OF THE SERIES SUPPLEMENT.
EACH PURCHASER OF THIS CLASS A-2 CERTIFICATE IS HEREBY NOTIFIED
THAT THE SELLER OF THIS CLASS A-2 CERTIFICATE MAY BE RELYING ON
THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES
ACT PROVIDED BY RULE 144A THEREUNDER."
6. The Purchaser understands that no subsequent transfer of the Class
A-2 Certificates is permitted unless (A) such transfer is of a Class A-2
Certificate with an aggregate Initial Amortizing Notional Balance equal to or
greater than $40,000 and (B) it causes its proposed transferee to provide to
the Trustee and the Initial Purchaser a letter substantially in the form of
Exhibit C to the Series Supplement and otherwise satisfactory to the Trustee
and Initial Purchaser, as applicable, or such other written statement as the
Depositor shall prescribe.
7. The Purchaser agrees that, if at some time in the future it wishes to
transfer or exchange any of the Class A-2 Certificates, it will not transfer
or exchange any of the Class A-2 Certificates unless such transfer or exchange
is in accordance with Section 5.04 of the Trust Agreement. The Purchaser
understands that any purported transfer of the Class A-2 Certificates (or any
interest therein) in contravention of any of the restrictions and conditions
in the Trust Agreement, as applicable, shall be void, and the purported
transferee in such transfer shall not be
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recognized by the Trust or any other Person as a Certificateholder, as the
case may be, for any purpose.
8. The purchaser (i) acknowledges that the Depositor, the Initial
Purchaser, the Trustee and others will rely upon the truth and accuracy of the
foregoing acknowledgments, representations and agreements and agrees that the
Depositor, the Initial Purchaser, the Trustee are irrevocably authorized to
produce this letter or a copy hereof to any interested party in any
administrative or legal proceeding or official inquiry with respect to the
matters covered hereby, and (ii) agrees that, if any of the acknowledgments,
representations, warranties and agreements made or deemed to have been made by
such purchaser's purchase of the Class A-2 Certificates are no longer
accurate, such purchaser shall promptly notify the Depositor and the Initial
Purchaser. If the purchaser is acquiring any Class A-2 Certificates as a
fiduciary or agent for one or more investor accounts, it represents that it
has sole investment discretion with respect to each such account and it has
full power to make the foregoing acknowledgments, representations and
agreements on behalf of each such account and that each such investor account
is eligible to purchase the Class A-2 Certificates.
Very truly yours,
By:
---------------------------------
Name:
Title:
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