CorTS(R) SUPPLEMENT 2001-10
between
STRUCTURED PRODUCTS CORP.,
as Depositor
and
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee
CorTS(R) Trust II For BellSouth Debentures
TABLE OF CONTENTS
Page
Preliminary Statement.............................................1
Section 1. Certain Defined Terms..................................1
Section 2. Creation and Declaration of Trust; Sale of Term
Assets; Acceptance by Trustee..........................4
Section 3. Designation............................................5
Section 4. Date of the Certificates...............................5
Section 5. Certificate Principal Balance and Denominations;
Additional Term Assets.................................5
Section 6. Currency of the Certificates...........................6
Section 7. Form of Securities.....................................6
Section 8. Call Warrants..........................................6
Section 9. Certain Provisions of Base Trust Agreement Not
Applicable.............................................7
Section 10. Distributions..........................................7
Section 11. Termination of Trust...................................9
Section 12. Limitation of Powers and Duties........................9
Section 13. Compensation of Trustee...............................10
Section 14. Modification or Amendment.............................11
Section 15. Accounting............................................11
Section 16. No Investment of Amounts Received on Term Assets......11
Section 17. No Event of Default...................................11
Section 18. Notices...............................................11
Section 19. Access to Certain Documentation ......................12
Section 20. Advances..............................................12
Section 21. Ratification of Agreement.............................12
Section 22. Counterparts..........................................12
Section 23. Governing Law.........................................12
Section 24. Affiliate Exchange Right..............................12
Section 25. Certificate of Compliance.............................12
Section 26. Appointment of Co-Trustee.............................13
Exhibit A..-- Identification of the Term Assets as of Closing Date
Exhibit B..-- Terms of the Certificates as of Closing Date
Exhibit C..-- Form of Certificates
Exhibit D..-- Form of Call Warrant
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CorTS(R) SUPPLEMENT 2001-10, dated as of March 23, 2001 (this "Series
Supplement"), between STRUCTURED PRODUCTS CORP., a Delaware
corporation, as depositor (the "Depositor"), and U.S. BANK TRUST
NATIONAL ASSOCIATION, a national banking association, as trustee (the
"Trustee").
PRELIMINARY STATEMENT
Pursuant to the Base Trust Agreement, dated as of December 15, 2000
(the "Base Trust Agreement" and, as supplemented pursuant to the Series
Supplement, the "Agreement"), between the Depositor and the Trustee, such
parties may at any time and from time to time enter into a series supplement
supplemental to the Base Trust Agreement for the purpose of creating a trust.
Section 5.13 of the Base Trust Agreement provides that the Depositor may at any
time and from time to time direct the Trustee to authenticate and deliver, on
behalf of any such trust, a new Series of trust certificates. Each trust
certificate of such new Series of trust certificates will represent a fractional
undivided beneficial interest in such trust. Certain terms and conditions
applicable to each such Series are to be set forth in the related series
supplement to the Base Trust Agreement.
Pursuant to this Series Supplement, the Depositor and the Trustee
shall create and establish a new trust to be known as CorTS(R) Trust II For
BellSouth Debentures, and a new Series of trust certificates to be issued
thereby, which certificates shall be known as the CorTS(R) Certificates, and the
Depositor and the Trustee shall herein specify certain terms and conditions in
respect thereof.
The Certificates shall be Fixed Rate Certificates issued in one Class
(the "Certificates"). The Trust also is issuing call options with respect to
$82,840,000 principal amount of Term Assets (the "Call Warrants").
On behalf of and pursuant to the authorizing resolutions of the Board
of Directors of the Depositor, an authorized officer of the Depositor has
authorized the execution, authentication and delivery of the Certificates, and
has authorized the Base Trust Agreement and this Series Supplement in accordance
with the terms of Section 5.13 of the Base Trust Agreement.
Section 1. Certain Defined Terms. (a) All terms used in this Series
Supplement that are defined in the Base Trust Agreement, either directly or by
reference therein, have the meanings assigned to such terms therein, except to
the extent such terms are defined or modified in this Series Supplement or the
context requires otherwise. The Base Trust Agreement also contains rules as to
usage which shall be applicable hereto.
(b) Pursuant to Article I of the Base Trust Agreement, the meaning of
certain defined terms used in the Base Trust Agreement shall, when applied to
the trust certificates of a particular Series, be as defined in Article I but
with such additional provisions and modifications as are specified in the
related series supplement. With respect to the Certificates, the following
definitions shall apply:
"Acceleration": The acceleration of the maturity of the Term Assets after
the occurrence of any default on the Term Assets other than a Payment Default.
"Agreement": Agreement shall have the meaning specified in the Preliminary
Statement to this Series Supplement.
"Base Trust Agreement": Base Trust Agreement shall have the meaning
specified in the Preliminary Statement to this Series Supplement.
"Business Day": Any day other than a Saturday, Sunday or a day on which
banking institutions in New York, New York are authorized or obligated by law,
executive order or governmental decree to be closed.
"Call Warrant": Call Warrant shall have the meaning specified in the
Preliminary Statement to this Series Supplement.
"Certificateholder" or "Holder": With respect to any Certificate, the
Holder thereof.
"Certificateholders" or "Holders": The Holders of the Certificates.
"Closing Date": March 23, 2001.
"Certificate Account": With respect to this Series, the Eligible Account
established and maintained by the Trustee in its corporate trust department in
the Trustee's name for the benefit of the related Certificateholders, into which
all payments made on or with respect to the related Term Assets will be
deposited.
"Collection Period": The period from (but excluding) the preceding
Distribution Date (or, in the case of the first Distribution Date, from and
including the Closing Date), through and including the current Distribution
Date.
"Corporate Trust Office": U.S. Bank Trust National Association, 000 Xxxx
Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate Trust or such
other corporate trust office as the Trustee shall designate in writing to the
Depositor and the Certificateholders.
"Depositary": The Depository Trust Company.
"Distribution Date": Any Scheduled Distribution Date, the Maturity Date or
any Term Assets Default Distribution Date.
"Fixed Payment": Each equal semiannual installment of interest payable on
the Term Assets on each June 1 and December 1 or, if any such day is not a
Business Day, then the immediately following Business Day, except that the final
installment of interest will be payable on December 1, 2095, commencing on June
1, 2001 through and including December 1, 2095.
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"Interest Collections": With respect to any Distribution Date, all payments
received by the Trustee, during the Collection Period ending on such
Distribution Date, in respect of (i) interest on the Term Assets and (ii)
penalties or other amounts required to be paid because of late payments on the
Term Assets.
"Maturity Date": December 1, 2095.
"Payment Default": A default by the Term Assets Issuer in the payment of
any amount due on the Term Assets after the same becomes due and payable (and
the expiration of any applicable grace period on the Term Assets).
"Place of Distribution": New York, New York.
"Rating Agency": Each of Xxxxx'x Investors Service, Inc. ("Moody's"), and
Standard & Poor's Ratings Services ("S&P"), a division of The XxXxxx-Xxxx
Companies, Inc., and any successor to either of the foregoing. References to
"the Rating Agency" in the Agreement shall be deemed to be each such credit
rating agency.
"Record Date": With respect to any Distribution Date, the day immediately
preceding such Distribution Date.
"Scheduled Distribution Date": The first day of each May and November or,
if any such day is not a Business Day, then the immediately following Business
Day, except that the final Scheduled Distribution Date shall be December 1,
2095, commencing June 1, 2001 through and including December 1, 2095; provided,
however, that payment on each Scheduled Distribution Date shall be subject to
prior payment of interest or principal, as applicable, on the Term Assets.
"Specified Currency": United States Dollars.
"Term Assets": As of the Closing Date, $82,840,000 aggregate principal
amount of 7% debentures issued by the Term Assets Issuer, sold to the Trustee by
the Depositor and identified on Exhibit A hereto. Additional Term Assets may
also be sold to the Trustee from time to time pursuant to Section 5 of this
Series Supplement.
"Term Assets Default Distribution Date": The date on which the Trustee
makes a distribution of the proceeds received in connection with a recovery on
the Term Assets (in the case of Payment Default, after deducting any costs
incurred in connection therewith) following a Payment Default or an Acceleration
or other default with respect to the Term Assets.
"Term Assets Issuer": BellSouth Telecommunications, Inc.
"Term Assets Payment Date": The first day of each June and December,
commencing on June 1, 2001 and ending on December 1, 2095; provided, however,
that if any Term Assets Payment Date would otherwise fall on a day that is not a
Business Day, such Term Assets Payment Date will be the following Business Day.
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"Term Assets Prospectus": The prospectus of the Term Assets Issuer, dated
November 1, 1995, as supplemented by a supplement thereto, dated November 28,
1995, with respect to the Term Assets.
"Term Assets Trustee": The trustee for the Term Assets.
"Trust": CorTS(R)Trust II For BellSouth Debentures.
"Trust Termination Event": (a) the payment in full at maturity or upon
early redemption of the Certificates, (b) the distribution of the proceeds
received upon a recovery on the Term Assets in the case of a Payment Default
(after deducting the costs incurred in connection therewith) or an Acceleration
thereof (or other default with respect to the Term Assets), (c) the distribution
in kind of the Term Assets upon a tender by an affiliate of the Depositor of
100% of the then outstanding Call Warrants and Certificates in exchange for 100%
of the Term Assets, or (d) the sale by the Trustee in accordance with the Call
Warrants of all the Term Assets and the distribution in full of all amounts due
to Certificateholders.
"Voting Rights": The Certificateholders shall have 100% of the total Voting
Rights with respect to the Certificates, which Voting Rights shall be allocated
among all Holders of Certificates in proportion to the principal balances held
by such Holders on any date of determination.
"Warrant Agent Agreement": The 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 or modified from time
to time.
"Warrant Exercise Date": Warrant Exercise Date shall have the meaning given
to such term in the Call Warrant.
"Warrant Exercise Purchase Price": An amount paid by the Warrantholder on
each Warrant Exercise Date equal to the principal amount of the Term Assets
being purchased pursuant to the exercise of the Call Warrants plus accrued and
unpaid interest to and including the Warrant Exercise Date.
"Warrantholder": Warrantholder shall have the meaning given to such term in
the Call Warrant.
Section 2. Creation and Declaration of Trust; Sale of Term Assets;
Acceptance by Trustee. (a) The Trust, of which the Trustee is the trustee, is
hereby created under the laws of the State of New York for the benefit of the
holders of the Certificates. The Trust shall be irrevocable.
(b) The Depositor, concurrently with the execution and delivery hereof and
pursuant to Section 2.1 of the Base Trust Agreement, has delivered or caused to
be delivered to the Trustee the Term Assets.
(c) The Depositor does hereby sell, transfer, assign, set over and
otherwise convey to the Trustee on behalf and for the benefit of the holders of
the Certificates and the
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Trust, without recourse, the Term Assets. The Trustee shall pay the purchase
price for the Term Assets by delivering to, or at the direction of, the
Depositor, all of the Certificates on the Closing Date and making the payments
identified in Section 10(k) of this Series Supplement.
(d) The Trustee hereby (i) acknowledges such sale, deposit and delivery,
pursuant to subsections (b) and (c) above, and receipt by it of the Term Assets,
(ii) accepts the trusts created hereunder in accordance with the provisions
hereof and of the Base Trust Agreement but subject to the Trustee's obligation,
as and when the same may arise, to make any payment or other distribution of the
assets of the Trust as may be required pursuant to this Series Supplement, the
Base Trust Agreement and the Certificates, and (iii) agrees to perform the
duties herein or therein required and any failure to receive reimbursement of
expenses and disbursements under Section 13 hereof shall not release the Trustee
from its duties herein or therein.
Section 3. Designation. There is hereby created a Series of trust
certificates to be issued pursuant to the Base Trust Agreement and this Series
Supplement to be known as the "CorTS(R) Certificates." The Certificates shall be
issued in one class, in the amount set forth in Section 5 and with the
additional terms set forth in Exhibit B to this Series Supplement. The
Certificates shall be issued in substantially the form set forth in Exhibit C to
this Series Supplement with such necessary or appropriate changes as shall be
approved by the Depositor and the Trustee, such approval to be manifested by the
execution and authentication thereof by the Trustee. The Certificates shall
evidence undivided ownership interests in the assets of the Trust, subject to
the liabilities of the Trust and shall be payable solely from payments or
property received by the Trustee on or in respect of the Term Assets.
Section 4. Date of the Certificates. The Certificates that are
authenticated and delivered by the Trustee to or upon Depositor Order on the
Closing Date shall be dated the Closing Date. All other Certificates that are
authenticated after the Closing Date for any other purpose under the Agreement
shall be dated the date of their authentication.
Section 5. Certificate Principal Balance and Denominations; Additional Term
Assets. On the Closing Date, up to 3,313,600 Certificates with a Certificate
Principal Balance of $82,840,000 may be authenticated and delivered under the
Base Trust Agreement and this Series Supplement. The Certificate Principal
Balance shall initially equal the initial principal amount of Term Assets sold
to the Trustee and deposited in the Trust. Such Certificate Principal Balance
shall be calculated without regard to Certificates authenticated and delivered
upon registration of, transfer of, or in exchange for, or in lieu of, other
Certificates pursuant to Sections 5.3, 5.4 or 5.5 of the Base Trust Agreement.
The Depositor may sell to the Trustee additional Term Assets on any date
hereafter upon at least five (5) Business Days notice to 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 Term Assets will not
materially increase the likelihood that the Trust would fail to qualify as a
grantor trust under the Code. Upon such sale to the Trustee, the Trustee shall
deposit such additional Term Assets in the Certificate Account, and shall
authenticate and deliver to the Depositor, or its order, Certificates in a
Certificate Principal Balance equal to the principal amount of such additional
Term Assets. Any such additional Certificates authenticated and delivered shall
rank pari passu with any Certificates previously issued in accordance with this
Series Supplement.
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Section 6. Currency of the Certificates. All distributions on the
Certificates will be made in the Specified Currency.
Section 7. Form of Securities. The Trustee shall execute and deliver the
Certificates in the form of one or more global certificates registered in the
name of DTC or its nominee.
Section 8. Call Warrants. (a) Concurrently with the execution of this
Series Supplement, the Trustee, on behalf of the Trust, shall execute the
Warrant Agent Agreement and one Call Warrant, dated as of the date hereof and
substantially in the form of Exhibit D 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.
(b) The Trustee may not enter into any amendment or modification of
the Call Warrant except as provided in Section VI.4 of the Call Warrant.
(c) The Trustee shall notify the Certificateholders and the Rating
Agencies upon receipt of any notice, pursuant to the provision of the Call
Warrants, of a Warrantholder's intent to exercise its Call Warrants. Such notice
from the Trustee shall state the Warrant Exercise Date, that such exercise of
the Call Warrant is conditional upon receipt by the Trustee of the Warrant
Exercise Purchase Price with respect to such exercise, that the Trustee will
select by lot for redemption a principal amount of Certificates equal to the
principal amount of Term Assets to be purchased, and that such redemption of the
Certificates will occur on the Warrant Exercise Date at a price equal to $25 per
Certificate plus accrued and unpaid interest to the date of redemption. A holder
of a Call Warrant may rescind its notice given pursuant to the terms of the Call
Warrant and any rescission of such notice or failure to pay the Warrant Exercise
Purchase Price pursuant to a rescinded notice shall not adversely affect the
right of a Warrantholder to deliver a notice thereafter. The Trustee shall
promptly notify Certificateholders of any rescission of such a notice and that
the redemption of Certificates in connection with such exercise is also
rescinded.
(d) Upon the exercise of any Call Warrant in accordance with the
terms of the Call Warrants, the Trustee, after receipt of the Warrant Exercise
Purchase Price and the Call Warrants being exercised, shall deliver or cause to
be delivered upon the written direction of the Warrant Agent, by 1:00 p.m. (New
York City time) on the related Warrant Exercise Date, the Term Assets as
specified in the exercised Call Warrant by instructing the Depositary to credit
such Term Assets to the account of the exercising Warrantholder or its nominee,
provided that the Trustee shall have received notice of the exercise of such
Call Warrant from the Warrant Agent in accordance with the terms of the Call
Warrants and shall have received from the Warrant Agent an amount, in
immediately available funds in a form acceptable to the Trustee, equal to the
Warrant Exercise Purchase Price for such Term Assets by 1:00 p.m. (New York City
time) on the related Warrant Exercise Date.
(e) Upon receipt of the Warrant Exercise Purchase Price pursuant to
this Section 8 and the Call Warrants being exercised, the Trustee shall deposit
the amount of the Warrant Exercise Purchase Price in the Certificate Account on
or before the related Warrant Exercise Date. The Certificates to be redeemed
will be selected by the Trustee or DTC by lot and will be
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paid for on the Warrant Exercise Date.
Section 9. Certain Provisions of Base Trust Agreement Not Applicable. The
provisions of Sections 2.3, 3.2, 3.3, 3.4, 3.5, 3.6, 3.8, 3.10, 3.11, 3.12,
5.16, 5.17, 6.1(c) through (e), 6.6 and 9.1 of the Base Trust Agreement and any
other provision of the Base Trust Agreement, which imposes obligations on, or
creates rights in favor of, the Trustee or the Certificateholders as a result of
or in connection with an "Event of Default" or "Administrative Agent Termination
Event" shall be inapplicable with respect to the Certificates. In addition,
there is no "Administrative Agent" specified herein, and all references to
"Administrative Agent" in the Base Trust Agreement, therefore shall be
inapplicable with respect to the Certificates.
Section 10. Distributions.
(a) On each Scheduled Distribution Date, the Trustee shall distribute to
the Certificateholders the related Fixed Payment, to the extent of Interest
Collections, and on the Maturity Date shall distribute to the Certificateholders
the principal balance of the Certificates (in the amount of $82,840,000), to the
extent the principal of the Term Assets is received by the Trustee on such date,
and all other amounts held in the Trust; provided, however, if any such payment
with respect to the Term Assets is made to the Trustee after the Term Assets
Payment Date on which such payment was due, the Trustee shall distribute such
amount received on the Business Day following such receipt.
(b) In the event of a Payment Default, the Trustee shall proceed against
the Term Assets Issuer on behalf of the Certificateholders to enforce the Term
Assets or otherwise to protect the interests of the Certificateholders, subject
to the receipt of indemnity in form and substance satisfactory to the Trustee;
provided that, holders of the Certificates representing a majority of the Voting
Rights on the Certificates will be entitled to direct the Trustee in any such
proceeding or direct the Trustee to sell the Term Assets, subject to the
Trustee's receipt of satisfactory indemnity. If the Trustee is directed to sell
the Term Assets, the Trustee shall solicit bids for the sale of the Term Assets
with settlement thereof on or before the third (3rd) Business Day after such
sale from three leading dealers in the relevant market. Any of the following
dealers shall be deemed to qualify as leading dealers: (1) Credit Suisse First
Boston Corporation, (2) Xxxxxxx, Xxxxx & Co., (3) Xxxxxx Brothers Inc., (4)
Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated, (5) UBS Securities LLC and
(6) Xxxxxxx Xxxxx Xxxxxx Inc.; provided, however, that no bid from Xxxxxxx Xxxxx
Xxxxxx Inc. or any affiliate thereof shall be accepted unless such bid equals
the then fair market value of such Term Assets. 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 Term Assets 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 Acceleration and a corresponding payment on the Term Assets,
the Trustee shall distribute the proceeds to the Certificateholders no later
than two (2) Business Days after the receipt of immediately available funds.
(c) In the event that the Trustee receives money or other property in
respect of the Term Assets (other than a scheduled payment on or with respect to
an interest payment date) as a result of a Payment Default on the Term Assets
(including from the sale thereof), the Trustee
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will promptly give notice as provided in Section 18(c) to the Depositary, 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. Such notice shall state that, not later than 30 days after the receipt
of such moneys or other property, the Trustee will allocate and distribute such
moneys or other property to the holders of Certificates then outstanding and
unpaid, pro rata by principal amount (after deducting the costs incurred in
connection therewith and subject to clause (k) of this Section 10). 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 Term Assets
to Certificateholders will be deemed to reduce the principal amount of
Certificates on a dollar-for-dollar basis. Following such in kind distribution,
all Certificates will be cancelled. Other than as provided in clause (k) below,
no amounts will be distributed to the Depositor in respect of the Term Assets.
(d) Distributions to the Certificateholders on each Distribution Date will
be made to the Certificateholders of record on the Record Date.
(e) All distributions to Certificateholders shall be allocated pro rata
among the Certificates based on their respective principal balances as of the
Record Date.
(f) Notwithstanding any provision of the Agreement to the contrary, to the
extent funds are available, the Trustee will initiate payment in immediately
available funds by 10:00 A.M. (New York City time) on each Distribution Date of
all amounts payable to each Certificateholder with respect to any Certificate
held by such Certificateholder or its nominee (without the necessity for any
presentation or surrender thereof or any notation of such payment thereon) in
the manner and at the address as each Certificateholder may from time to time
direct the Trustee in writing fifteen (15) days prior to such Distribution Date
requesting that such payment will be so made and designating the bank account to
which such payments shall be so made. The Trustee shall be entitled to rely on
the last instruction delivered by the Certificateholder pursuant to this Section
10(f) unless a new instruction is delivered fifteen (15) days prior to a
Distribution Date.
(g) Reserved.
(h) Reserved.
(i) Reserved.
(j) The rights of the Certificateholders to receive distributions in
respect of the Certificates, and all interests of the Certificateholders in such
distributions, shall be as set forth in this Series Supplement. The Trustee
shall in no way be responsible or liable to the Certificateholders nor shall any
Certificateholder in any way be responsible or liable to any other
Certificateholder in respect of amounts previously distributed on the
Certificates based on their respective principal balances.
(k) On the Closing Date, as partial payment for the Term Assets, the
Trustee shall deliver to, or at the direction of, the Depositor all of the
Certificates to the Warrantholders. On June 1, 2001, as payment of the balance
of the purchase price for the Term Assets, the
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Trustee shall pay to the Depositor from the Fixed Payment received on such date
the amount of the interest accrued on the Term Assets from December 1, 2000 to
but not including the Closing Date, which amount equals $1,804,071.11. In the
event that the Fixed Payment is not received by the Trustee on such date or
otherwise is insufficient to pay such amount of accrued interest to the
Depositor, the Depositor shall have a claim for the unpaid portion of such
amount and shall share pari passu with Certificateholders to the extent of such
claim in the proceeds from the sale of the Term Assets.
Section 11. Termination of Trust. (a) The Trust shall terminate upon the
occurrence of any Trust Termination Event.
(b) Except for any reports and other information required to be provided to
Certificateholders hereunder and under the Base Trust Agreement and except as
otherwise specified herein and therein, the obligations of the Trustee will
terminate upon the distribution to Certificateholders of all amounts required to
be distributed to them and the disposition of all Term Assets held by the
Trustee. The Trust shall thereupon terminate, except for surviving rights of
indemnity.
Section 12. Limitation of Powers and Duties. (a) The Trustee shall
administer the Trust and the Term Assets solely as specified herein and in the
Base Trust Agreement.
(b) The Trust is constituted solely for the purpose of acquiring and
holding the Term Assets. The Trustee is not authorized to acquire any other
investments or engage in any activities not authorized herein and, in
particular, unless expressly provided in the Agreement, the Trustee is not
authorized (i) to sell, assign, transfer, exchange, pledge, set-off or otherwise
dispose of any of the Term Assets, once acquired, or interests therein,
including to Certificateholders, (ii) to merge or consolidate the Trust with any
other entity, or (iii) to do anything that would materially increase the
likelihood that the Trust will fail to qualify as a grantor trust for United
States federal income tax purposes. In addition, the Trustee has no power to
create, assume or incur indebtedness or other liabilities in the name of the
Trust other than as contemplated herein and in the Base Trust Agreement.
(c) The parties acknowledge that the Trustee, as the holder of the Term
Assets, has the right to vote and give consents and waivers in respect of the
Term Assets and enforce the other rights, if any, of a holder of the Term
Assets, except as otherwise limited by the Base Trust Agreement or this Series
Supplement. In the event that the Trustee receives a request from the Term
Assets Trustee, the Term Assets Issuer or, if applicable, the Depositary with
respect to the Term Assets, for the Trustee's consent to any amendment,
modification or waiver of the Term Assets, or any document relating thereto, or
receives any other solicitation for any action with respect to the Term Assets,
the Trustee shall within two (2) Business Days mail a notice of such proposed
amendment, modification, waiver or solicitation to each Certificateholder of
record as of the date of such request. The Trustee shall request instructions
from the Certificateholders as to what action to take in response to such
request and shall be protected in taking no action if no direction is received.
Except as otherwise provided herein, the Trustee shall consent or vote, or
refrain from consenting or voting, in the same proportion (based on the
principal balances of the Certificates) as the Certificates of the Trust were
actually voted or not voted by the Holders thereof as of the date determined by
the Trustee prior to the date
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such vote or consent is required; provided, however, that, notwithstanding
anything to the contrary in the Base Trust Agreement or this Series Supplement,
the Trustee shall at no time vote in favor of or consent to any matter (i) which
would alter the timing or amount of any payment on the Term Assets (including,
without limitation, any demand to accelerate the Term Assets) or (ii) which
would result in the exchange or substitution of any Term Asset whether or not
pursuant to a plan for the refunding or refinancing of such Term Asset, except
in each case with the unanimous consent of the Certificateholders and subject to
the requirement that such vote would not materially increase the likelihood that
the Trust will fail to qualify as a grantor trust for federal income tax
purposes, such determination to be based solely on an Opinion of Counsel. The
Trustee shall have no liability for any failure to act or to refrain from acting
resulting from the Certificateholders' late return of, or failure to return,
directions requested by the Trustee from the Certificateholders.
(d) Notwithstanding any provision of the Agreement to the contrary, the
Trustee may require from the Certificateholders prior to taking any action at
the direction of the Certificateholders, an indemnity agreement of a
Certificateholder or any of its Affiliates to provide for security or indemnity
against the costs, expenses and liabilities the Trustee may incur by reason of
any such action. An unsecured indemnity agreement, if acceptable to the Trustee,
shall be deemed to be sufficient to satisfy such security or indemnity
requirement.
(e) Notwithstanding any provision of the Agreement to the contrary, the
Trustee shall act as the sole Authenticating Agent, Paying Agent and Registrar.
Section 13. Compensation of Trustee. Each of the Trustee and U.S. Bank
National Association, as co-trustee (the "co-trustee"), shall be entitled to
receive from the Depositor as compensation for its services hereunder, trustee's
fees pursuant to a separate agreement among the Trustee, the co-trustee, and the
Depositor, and shall be reimbursed for all reasonable expenses, disbursements
and advances incurred or made by it (including the reasonable compensation,
disbursements and expenses of its counsel and other persons not regularly in its
employ). The Depositor shall indemnify and hold harmless each of the Trustee and
the co-trustee, and its successors, assigns, agents and servants against any and
all loss, liability or reasonable expense (including attorneys' fees) incurred
by it in connection with the administration of this trust and the performance of
its duties thereunder. The Trustee and the co-trustee shall notify the Depositor
promptly of any claim for which they may seek indemnity. Failure by the Trustee
or the co-trustee to so notify the Depositor shall not relieve the Depositor of
its obligations hereunder. The Depositor need not reimburse any expense or
indemnify against any loss, liability or expense incurred by the Trustee or the
co-trustee through the Trustee's or the co-trustee's own willful misconduct,
negligence or bad faith. The indemnities contained in this Section 13 shall
survive the resignation or termination of the Trustee or the co-trustee, or the
termination of this Agreement.
Failure by the Depositor to pay, reimburse or indemnify the Trustee or the
co-trustee shall not entitle the Trustee or the co-trustee to any payment,
reimbursement or indemnification from the Trust, nor shall such failure release
either the Trustee or the co-trustee from the duties it is required to perform
under this Series Supplement. Any unpaid, unreimbursed or unindemnified amounts
shall not be borne by the Trust and shall not constitute a claim against the
Trust, but shall be borne by each of the Trustee and the co-trustee in its
10
individual capacity, and the Trustee and the co-trustee shall have no recourse
against the Trust with respect thereto.
Section 14. Modification or Amendment. The Trustee shall not enter into
any modification or amendment of the Base Trust Agreement or this Series
Supplement unless such modification or amendment is in accordance with Section
10.1 of the Base Trust Agreement. Pursuant to Section 5 of this Series
Supplement, the Depositor may sell to the Trustee additional Term Assets from
time to time without violation or trigger of this Section 14.
Section 15. Accounting. Notwithstanding Section 3.16 of the Base Trust
Agreement, Independent Public Accountants' Administration Report, no such
accounting reports shall be required. Pursuant to Section 4.2 of the Base Trust
Agreement, Reports to Certificateholders, the Trustee shall cause the statements
to be prepared and forwarded as provided therein.
Section 16. No Investment of Amounts Received on Term Assets. All amounts
received on or with respect to the Term Assets shall be held uninvested by the
Trustee.
Section 17. No Event of Default. There shall be no Events of Default
defined with respect to the Certificates.
Section 18. Notices. (a) All directions, demands and notices hereunder and
under the Base Trust Agreement shall be in writing and shall be deemed to have
been duly given when received if personally delivered or mailed by first class
mail, postage prepaid or by express delivery service or by certified mail,
return receipt requested or delivered in any other manner specified herein, (i)
in the case of the Depositor, to Structured Products Corp., 000 Xxxxxxxxx
Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Secretary, or such other
address as may hereafter be furnished to the Trustee in writing by the
Depositor, and (ii) in the case of the Trustee, to U.S. Bank Trust National
Association, 000 Xxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Corporate Trust, facsimile number (000) 000-0000, or such other address as may
hereafter be furnished to the Depositor in writing by the Trustee.
(b) For purposes of delivering notices to the Rating Agency under Section
10.07 of the Base Trust Agreement, Notice to Rating Agency, or otherwise, such
notices shall be mailed or delivered as provided in such Section 10.07, Notice
to Rating Agency, to: Standard & Poor's Ratings Services, 00 Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000; and Xxxxx'x Investors Service, Inc., Structured Derivative
Products, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; or such other address as
the Rating Agency may designate in writing to the parties hereto.
(c) In the event a Payment Default or an Acceleration occurs, the Trustee
shall promptly give notice to the Depositary or, for any Certificates which are
not then held by the Depositary or any other depository, directly to the
registered holders of the Certificates thereof. Such notice shall set forth (i)
the identity of the issue of Term Assets, (ii) the date and nature of such
Payment Default or Acceleration, (iii) the principal amount of the interest or
principal in default, (iv) the Certificates affected by the Payment Default or
Acceleration, and (v) any other information which the Trustee may deem
appropriate.
11
(d) Notwithstanding any provisions of the Agreement to the contrary, the Trustee
shall deliver all notices or reports required to be delivered to or by the
Trustee or the Depositor to the Certificateholders without charge to such
Certificateholders.
Section 19. Access to Certain Documentation. Access to documentation
regarding the Term Assets will be afforded without charge to any
Certificateholder so requesting pursuant to Section 3.17 of the Base Trust
Agreement, Access to Certain Documentation. Additionally, the Trustee shall
provide at the request of any Certificateholder without charge to such
Certificateholder the name and address of each Certificateholder of Certificates
hereunder as recorded in the Certificate Register for purposes of contacting the
other Certificateholders with respect to their rights hereunder or for the
purposes of effecting purchases or sales of the Certificates, subject to the
transfer restrictions set forth herein.
Section 20. Advances. There is no Administrative Agent specified herein;
hence no person (including the Trustee) shall be permitted or obligated to make
Advances as described in Section 4.3 of the Base Trust Agreement, Advances.
Section 21. Ratification of Agreement. With respect to the Series issued
hereby, the Base Trust Agreement (including the grant of a security interest in
Section 10.8 of the Agreement with respect to the Term Assets conveyed
hereunder), as supplemented by this Series Supplement, is in all respects
ratified and confirmed, and the Base Trust Agreement as so supplemented by this
Series Supplement shall be read, taken and construed as one and the same
instrument. To the extent there is any inconsistency between the terms of the
Base Trust Agreement and this Series Supplement, the terms of this Series
Supplement shall govern.
Section 22. Counterparts. This Series Supplement may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all of such counterparts shall together constitute but one and the
same instrument.
Section 23. Governing Law. This Series Supplement and each Certificate
issued hereunder shall be governed by and construed in accordance with the laws
of the State of New York applicable to agreements made and to be performed
entirely therein without reference to such State's principles of conflicts of
law to the extent that the application of the laws of another jurisdiction would
be required thereby, and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.
Section 24. Affiliate Exchange Right. Any affiliate of the Depositor who
certifies in writing that it is one, but not the Depositor itself, will have the
right on any date to tender to the Trustee Certificates of a specified principal
amount together with Call Warrants relating to a principal amount of Term
Assets, and to receive in exchange Term Assets in an equal principal amount.
Section 25. Certificate of Compliance. The Depositor shall deliver to the
Trustee on or prior to June 30 of each year prior to a Trust Termination Event
the Officer's Certificate as to compliance as required by Section 6.1(b) of the
Base Trust Agreement.
Section 26. Appointment of Co-Trustee. The Depositor and the Trustee hereby
appoint U.S. Bank National Association, a national banking association, as
co-trustee under the
12
Agreement. Any action required to be taken by the Trustee may be taken by U.S.
Bank National Association, as co-trustee, in full satisfaction of the
obligations of the Trustee. By its acceptance of this Series Supplement, U.S.
Bank National Association hereby accepts its appointment as co-trustee under the
Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Series Trust
Agreement to be executed by their respective duly authorized officers as of the
date first above written.
STRUCTURED PRODUCTS CORP.
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------
Authorized Signatory
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------
Responsible Officer
ACCEPTED AND ACKNOWLEDGED BY:
U.S. BANK NATIONAL ASSOCIATION,
as Co-Trustee
By: /s/ Xxxxxxx X. Xxxxx
------------------------------
Responsible Officer
EXHIBIT A
IDENTIFICATION OF THE TERM ASSETS AS OF CLOSING DATE
Issuer: BellSouth Telecommunications, Inc.
Term Assets: 7% Debentures due December 1, 2095
Maturity Date: December 1, 2095
Original Principal Amount Issued: $500,000,000
CUSIP No.: 079867 AP2
Stated Interest Rate: 7% per annum
Interest Payment Dates: June 1 and December 1
Principal Amount of Term
Assets Deposited
Under Trust Agreement: $82,840,000
The Term Assets will be held by the Trustee as book-entry credits to an account
of the Trustee or its agent at The Depository Trust Company, New York, New York
("DTC").
A-1
EXHIBIT B
TERMS OF THE CERTIFICATES AS OF CLOSING DATE
Maximum Number of CorTS(R)
Certificates Up to 3,313,600
Aggregate Principal Amount
of CorTS(R)Certificates: $82,840,000
Authorized Denomination: $25 and integral multiples thereof
Rating Agencies: Standard & Poor's Ratings Services,
and Xxxxx'x Investors Service, Inc.
Closing Date: March 23, 2001
Distribution Dates: June 1 and December 1, the Maturity
Date or any Term Assets Default
Distribution Date.
Interest Rate: 7%
Maturity Date: December 1, 2095
Record Date: With respect to any Distribution
Date, the day immediately preceding
such Distribution Date.
Trustee's Fees: The Trustee's fees shall be payable
by the Depositor pursuant to a
separate fee agreement between the
Trustee and the Depositor.
Initial Certificate Registrar: U.S. Bank Trust National Association
Corporate Trust Office: U.S. Bank Trust National Association
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust
Department, Regarding CorTS(R)Trust II
For BellSouth Debentures
B-1
EXHIBIT C
FORM OF CERTIFICATES
THIS CERTIFICATE REPRESENTS AN UNDIVIDED 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.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC") 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.
CERTIFICATE NUMBER R-__ 3,313,600 Certificates
CUSIP: 22081C 20 8 $82,840,000 Certificate Principal Amount
CORTS(R) CERTIFICATES
evidencing an undivided interest in the Trust, as defined below, the assets of
which include BellSouth Debentures 7% Debentures due December 1, 2095.
This Certificate does not represent an interest in or obligation of the
Depositor or any of its affiliates.
THIS CERTIFIES THAT Cede & Co. is the registered owner of a nonassessable,
fully-paid, fractional undivided interest in CorTS(R)Trust II For BellSouth
Debentures (the "Trust") formed by Structured Products Corp., as depositor (the
"Depositor").
The Trust was created pursuant to a Base Trust Agreement, dated as of
December 15, 2000 (as amended and supplemented, the "Agreement"), 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 CorTS(R) Supplement 2001-10, dated as of
March 23, 2001 (the "Series Supplement" and, together with the Agreement, 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
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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
"CorTS(R) Certificates" (herein called the "Certificate" or "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 assets of the Trust include the Term Assets and all proceeds of
the Term Assets. Additional Term Assets may be sold to the Trustee and
additional Certificates may be authenticated and delivered from time to time as
provided in the Trust Agreement, which additional Certificates shall rank pari
passu with all other Certificates issued in accordance with the Series
Supplement.
Under the Trust Agreement, there shall be distributed on the dates
specified in the Trust Agreement (a "Distribution Date"), to the person in whose
name this Certificate is registered at the close of business on the related
Record Date, such Certificateholder's fractional undivided interest in the
amount of distributions of the Term Assets to be distributed to
Certificateholders on such Distribution Date. The Term Assets will pay interest
on June 1 and December 1 of each year, except that the final payment of interest
will be on December 1, 2095, with the next interest payment date occurring on
June 1, 2001. The principal of the Term Assets is scheduled to be paid on
December 1, 2095.
The distributions in respect of this Certificate are payable in such coin
or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts as set forth in the Series Trust
Agreement.
It is the intent of the Depositor and the Certificateholders that the
Trust will be classified as a grantor trust under subpart E, Part I of
subchapter J of the Internal Revenue Code of 1986, as amended. Except as
otherwise required by appropriate taxing authorities, the Depositor and the
Trustee, by executing the Trust Agreement, and each Certificateholder, by
acceptance of a Certificate, agrees to treat, and to take no action inconsistent
with the treatment of, the Certificates for such tax purposes as interests in a
grantor trust and the provisions of the Trust Agreement shall be interpreted to
further this intention of the parties.
Each Certificateholder, by its acceptance of a Certificate, covenants and
agrees that such Certificateholder shall not, prior to the date which is one
year and one day after the termination of the Trust Agreement, acquiesce,
petition or otherwise invoke or cause the Depositor to invoke the process of any
court or governmental authority for the purpose of commencing or sustaining a
case against the Depositor under any federal or state bankruptcy, insolvency,
reorganization or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Depositor or
any substantial part of its property, or ordering the winding up or liquidation
of the affairs of the Depositor.
The Trust Agreement permits the amendment thereof, in certain
circumstances, without the consent of the Holders of any of the Certificates.
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Unless the certificate of authentication hereon shall have been executed
by an authorized officer 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.
A copy of the Trust Agreement is available upon request and all of its
terms and conditions are hereby incorporated by reference and made a part
hereof.
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 PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
C-3
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed by its manual or facsimile signature.
U.S. BANK TRUST NATIONAL
ASSOCIATION, not in its individual
capacity but solely as Trustee and
Authenticating Agent
By:
--------------------------------
Authorized Signatory
EXHIBIT D
FORM OF CALL WARRANT
CORTS(R)TRUST II FOR BELLSOUTH DEBENTURES
Call Warrant
Dated as of March 23, 2001
THIS CALL WARRANT HAS NOT BEEN, AND THE WARRANTS REPRESENTED HEREBY HAVE 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. THIS
CALL WARRANT AND ANY WARRANT REPRESENTED HEREBY MAY BE TRANSFERRED ONLY IN
COMPLIANCE WITH THE CONDITIONS SPECIFIED IN THIS CALL WARRANT.
CORTS(R) TRUST II FOR BELLSOUTH DEBENTURES
Call Warrant
8,284 Warrants; Each Warrant Relating to $10,000 principal amount of Term Assets
No. W- --- March 23, 2001
CORTS(R) Trust II For BellSouth Debentures (the "Trust"), a trust created
under the laws of the State of New York pursuant to a Base Trust Agreement,
dated as of December 15, 2000 (the "Agreement"), between Structured Products
Corp. (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 CorTS(R) Supplement 2001-10, dated as of
March 23, 2001 (the "Series Supplement" and, together with the Agreement, the
"Trust Agreement"), between the Depositor and the Trustee, for value received,
hereby certifies that or registered assigns, is entitled to purchase $ principal
amount of the assets set forth on Schedule 1 hereto in whole or part on any
Warrant Exercise Date (as defined below) designated by the holder of this
instrument (this "Call Warrant") at a purchase price equal to the Warrant
Exercise Purchase Price (as defined below), all subject to the terms and
conditions set forth below.
Certain capitalized terms used in this Call Warrant are defined in Article
IV hereof; capitalized terms used but not defined herein shall have the
respective meanings set forth in the Trust Agreement; references to an "Exhibit"
are, unless otherwise specified, to one of the Exhibits attached to this Call
Warrant and references to a "Section" are, unless otherwise specified, to one of
the sections of this Call Warrant.
D-1
Article I
Exercise of Warrants
Section I.1 Manner of Exercise. (a) This Call Warrant may be exercised by
the holder hereof (each, a "Warrantholder"), in whole or in part, on any Warrant
Exercise Date, set forth in the prior written notice to the Warrant Agent and
the Trustee delivered at any time on or before the Business Day that is at least
fifteen (15) Business Days before such Warrant Exercise Date, by surrender of
this Call Warrant to the Warrant Agent at its office set forth in Section VI.3
hereof no later than 11:00 a.m. (New York City time) on such Warrant Exercise
Date; provided that such 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 applicable Warrant Exercise Purchase Price, in a
manner such that funds are available to the Warrant Agent no later than 11:00
a.m. (New York City time) on such Warrant Exercise Date, and such holder shall
thereupon be entitled to delivery of the Term Assets equal to $10,000 per Call
Warrant purchased hereunder in accordance with this Article I; provided further
that the Warrantholder may not exercise this Call Warrant at any time when such
Warrantholder is insolvent, and in connection therewith, such Warrantholder
shall be required to certify that it is solvent at the time of exercise
settlement, by completing the Form of Subscription attached to this Call Warrant
and delivering such completed Form of Subscription to the Trustee on or prior to
the Warrant Exercise Date.
(b) The Warrant Agent shall notify the Trustee immediately upon receipt by
the Warrant Agent of a notice by the holder of this Call Warrant and upon
receipt of payment of the applicable Warrant Exercise Purchase Price from such
holder pursuant to clause (a) of this Section I.1. The Warrant Agent shall
transfer each payment made by the holder hereof pursuant to clause (a) of this
Section I.1 to the Trustee in immediately available funds, for application
pursuant to the Trust Agreement no later than 1:00 p.m. (New York City time) on
the applicable Warrant Exercise Date (and, pending such transfer, shall hold
each such payment for the benefit of the holder hereof in a segregated trust
account).
(c) A notice by the holder of a Call Warrant does not impose any
obligations on a holder of a Call Warrant in any way to pay any Warrant Exercise
Purchase Price. If, by 11:00 a.m. (New York City time) on the Warrant Exercise
Date, the holder of the Call Warrant being exercised has not paid the Warrant
Exercise Purchase Price, then such notice shall automatically expire and none of
the holder of such Call Warrant, the Warrant Agent and the Trustee shall have
any obligations with respect to such notice by the holder of such Call Warrant.
The expiration of a notice by the holder of this Call Warrant shall in no way
affect a holder of a Call Warrant's right to subsequently deliver a notice which
satisfies the terms of the Trust Agreement.
Section I.2 Transfer of Term Assets. As soon as practicable after each
surrender of this Call Warrant, in whole or in part, and no later than 11:00
a.m. (New York City time) on the Warrant Exercise Date and upon satisfaction of
all other requirements described in this Call Warrant, the Warrant Agent shall
instruct the Trustee to cause the Term Assets represented by the number of
Warrants being exercised hereunder to be registered on the book-entry system of
the related depositary in the registered name or names furnished by the holder,
and, in case such exercise is in part only, a new Call Warrant of like tenor,
representing the remaining outstanding
D-2
Warrants of the holder, shall be delivered by the Warrant Agent to the holder
hereof. The Trustee shall cause the delivery of such portion of the Term Assets
to the holder or its nominee no later than 1:00 p.m. (New York City time) on the
applicable Warrant Exercise Date in accordance with Section 8(d) of the Trust
Agreement.
Section I.3 Cancellation and Destruction of Call Warrant. All Call Warrants
surrendered to the Warrant Agent for the purpose of exercise (in whole or in
part) pursuant to Section I.1 and actually exercised, or for the purpose of
transfer or exchange pursuant to Article III, shall be cancelled by the Warrant
Agent, and no Call Warrant shall be issued in lieu thereof. The Warrant Agent
shall destroy all cancelled Call Warrants.
Section I.4 No Rights as Holder of Term Assets Conferred by Warrants. Prior
to the exercise hereof, this Call Warrant shall not entitle the holder hereof to
any of the rights of a holder of the Term Assets, including, without limitation,
the right to receive the payment of any amount on or in respect of the Term
Assets or to enforce any of the covenants of the Trust Agreement.
Article II
Restrictions on Transfer
Section II.1 Restrictive Legends. Except as otherwise permitted by this
Article II, 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 has not been, and the Warrants represented hereby have
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. This
Call Warrant and any Warrant represented hereby may be transferred only in
compliance with the conditions specified in this Call Warrant and may not be
transferred to Xxxxxxx Xxxxx Xxxxxx Inc. or Structured Products Corp."
Section II.2 Notice of Proposed Transfer; Opinions of Counsel. Prior to any
transfer of any Call Warrant or portion thereof, the holder hereof will give
five (5) Business Days (or such lesser period acceptable to the Warrant Agent)
prior written notice to the Warrant Agent of such holder's intention to effect
such transfer and to comply in all other respects with this Section II.2. Each
transfer of a portion of a Call Warrant must be for a whole number of Warrants.
Each such notice (a) shall describe the manner and circumstances of the proposed
transfer in sufficient detail to enable counsel for the holder to render the
opinions referred to below, and (b) shall designate counsel for the holder
giving such notice. The holder giving such notice will submit a copy thereof to
the counsel designated in such notice. If (A) in the opinion of such counsel for
the holder the proposed transfer may be effected without registration of such
Call Warrant under the Securities Act (such opinion stating the basis for such
determination) and (B) such opinion is in form and substance satisfactory to the
Depositor and the Warrant Agent, such holder shall thereupon be entitled to
transfer such Call Warrant in accordance with the terms of the notice delivered
by such holder to the Warrant Agent. Each instrument representing such Call
Warrant or portion thereof issued upon or in connection with such transfer shall
bear
D-3
the restrictive legend required by Section II.1, unless the Warrant Agent shall
have received an opinion of counsel satisfactory to the Warrant Agent and the
Depositor that such legend is no longer required to ensure compliance with the
Securities Act.
Article III
Registration and Transfer of Call Warrants, etc.
Section III.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 whole numbers of Warrants. The Trustee and the Warrant Agent may
treat the Person in whose name any Call Warrant is registered on such register
as the owner thereof for all purposes, and the Trustee and the Warrant Agent
shall not be affected by any notice to the contrary.
Section III.2 Transfer and Exchange of Call Warrants. Upon surrender of any
Call Warrant for registration of transfer or for exchange to the Warrant Agent,
the Warrant Agent shall (subject to compliance with Article II) execute and
deliver, and cause the Trustee, on behalf of the Trust, to execute and deliver,
in exchange therefor, a new Call Warrant of like tenor and evidencing a like
whole number of Warrants, in the name of such holder or as such holder (upon
payment by such holder of any applicable transfer taxes or government charges)
may direct.
Section III.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 III.4 Execution and Delivery of Call Warrants by Trustee. The
Trustee, on behalf of the Trust, hereby agrees (subject to compliance with
Article II) to execute and deliver such new Call Warrants issued in accordance
with Section I.2 or this Article III as the Warrant Agent shall request in
accordance herewith.
Article IV
Definitions
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 Warrant": This instrument.
"Closing Date": March 23, 2001.
D-4
"Depositor": As defined in the introduction to this Call Warrant, or any
successor thereto under the Trust Agreement.
"Depositor Order": As defined in the Trust Agreement.
"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.
"Rating Agencies": Standard & Poor's Ratings Services and Xxxxx'x Investors
Service, Inc. and any successor thereto.
"Responsible Officer": As defined in the Trust Agreement.
"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 introduction to this Call Warrant.
"Trust Agreement": The Base Trust Agreement, dated as of December 15, 2000,
between the Depositor and the Trustee, as supplemented by the CorTS(R)
Supplement 2001-10, dated as of March 23, 2001, between the Depositor and the
Trustee, incorporating by reference the definitions and assumptions thereto, as
the same may be amended or modified from time to time.
"Trustee": As defined in the introduction to this Warrant, or any successor
thereto under the Trust Agreement.
"Warrant": The right to purchase, on a pro rata basis, an aggregate of
$10,000 in par amount of the Term Assets.
"Warrant Agent": U.S. Bank Trust National Association, a national banking
association, in its capacity as warrant agent hereunder, or any successor
thereto hereunder.
"Warrant Exercise Date": Any Business Day on or after March 23, 2006.
"Warrant Exercise Purchase Price": An amount paid by the Warrantholder on
each Warrant Exercise Date equal to the principal amount of the Term Assets
being purchased pursuant to the exercise of the Call Warrants plus accrued and
unpaid interest to and including the Warrant Exercise Date.
Article V
Warrant Agent
Section V.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
D-5
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.
Section V.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
holder of a Call Warrant 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 this Call Warrant or the execution
and delivery hereof (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 this Call Warrant; nor shall it by any act hereunder be deemed to
make any representation or warranty as to the Term Assets to be purchased
hereunder.
(f) The Warrant Agent is xxxxxx 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, 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
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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. 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 by 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 this Call Warrant against the
Warrant Agent, whose duties shall be determined solely by the express provisions
hereof. The Warrant Agent shall not be deemed to be a fiduciary.
(j) The Warrant Agent shall not have any duty to calculate or
determine any adjustments with respect either to the Warrant Exercise Purchase
Price or to the kind and amount of property receivable by holders of Call
Warrants upon the exercise thereof.
(k) 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.
(l) 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 this Call Warrant.
(m) 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.
Section V.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 holders of the Call Warrants 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 holders of the Call Warrants 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
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appoint a permanent successor to the Warrant Agent, which may be the interim
Warrant Agent. 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 holder of a
Call Warrant, then the Warrant Agent or registered holder of any Warrant 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.
Article VI
Miscellaneous
Section VI.1 Remedies. The remedies at law of the holder of this Call
Warrant 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 this Call Warrant
are not and will not be adequate and, to the fullest 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 hereof or otherwise.
Section VI.2 Limitation on Liabilities of Holder. Nothing contained in
this Call Warrant shall be construed as imposing any obligation on the holder
hereof to purchase any of the Term Assets except in accordance with the terms
hereof.
Section VI.3 Notices. All notices and other communications under this Call
Warrant 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 holder of any Call Warrant, at
the registered address of such 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 holder hereof 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
Warrant shall be effective in the manner provided in Article I.
Section VI.4 Amendment. (a) This Call Warrant may be amended from time to
time by the Depositor, the Trustee and the Warrant Agent without the consent of
the holder hereof, 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 alter the status of the Trust as a grantor trust under the
Code, 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 this Warrant which
shall not adversely affect in any material respect the interests of the holder
hereof or any holder of a Certificate or (ii) to evidence and provide for the
acceptance of appointment hereunder of a Warrant Agent other than U.S. Bank
Trust National Association.
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(b) Without limiting the generality of the foregoing, this Call
Warrant may also be modified or amended from time to time by the Depositor, the
Trustee and the Warrant Agent with the consent of the holders of 66-2/3% of the
Warrants, 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 this Call Warrant
or of modifying in any manner the rights of the holders of this Call Warrant;
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 dates on which 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 the holders of 100% of the affected Warrants 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, this Section VI.4(b) shall not be amended
without the consent of the holders of 100% of the affected Warrants.
(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 holder of a Call Warrant, to each holder of a Certificate
and to the Rating Agencies. It shall not be necessary for the consent of holders
of Warrants or 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 VI.5 Expiration. The right to exercise this Call Warrant shall
expire on the earliest to occur of (a) the cancellation hereof, (b) the
termination of the Trust Agreement, (c) the liquidation, disposition, or
maturity of all of the Term Assets, or (d) the occurrence of a Payment Default
or an Acceleration.
Section VI.6 Descriptive Headings. The headings in this Call Warrant are
for purposes of reference only and shall not limit or otherwise affect the
meaning hereof.
Section VI.7 GOVERNING LAW. THIS WARRANT INSTRUMENT 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 VI.8 Judicial Proceedings; Waiver of Jury. Any judicial proceeding
brought against the Trust, the Trustee or the Warrant Agent with respect to this
Call Warrant 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 this Call
Warrant, the Trustee on behalf of the Trust and the Warrant Agent (a)
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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 Call Warrant, subject to any rights of appeal,
and (b) irrevocably waive any objection that the Trust or the Trustee, 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 VI.9 Nonpetition Covenant; No Recourse. Each of (i) the holder of
this Call Warrant by its acceptance hereof, and (ii) the Warrant Agent agrees,
that it shall not (and, in the case of the 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.
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Each of (i) the holder of this Call Warrant, by its acceptance hereof, and
(ii) the Warrant Agent agrees, that it shall not have any recourse to the Term
Assets.
U.S. BANK TRUST NATIONAL ASSOCIATION,
not in its individual apacity but solely as
Trustee and Authenticating Agent
By:
---------------------------
Authorized Signatory
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Warrant Agent
By:
---------------------------
Authorized Signatory
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FORM OF SUBSCRIPTION
[To be executed only upon exercise of Warrants]
To CorTS(R) Trust II For BellSouth Debentures
U.S. Bank Trust National Association, as Trustee
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust
The undersigned registered holder of the within Call Warrant, having
previously given notice thereof in accordance with the terms of the Call
Warrant, hereby irrevocably exercises Warrant(s) for, and purchases pursuant
thereto, the Term Assets receivable upon such exercise, and herewith makes
payment of $10,000 per Warrant therefor, and requests that such Term Assets be
transferred to [insert information required for transfer of Term Assets]. In
connection therewith, the undersigned hereby certifies that it is solvent as of
the date hereof, as required by Section I.1 of the Call Warrant.
Dated:
(Signature must conform in all respects to name of holder as specified on
the face of Warrant)
(Street Address)
(City)(State)(Zip Code)
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FORM OF ASSIGNMENT
[To be executed only upon transfer of Call Warrant]
For value received, the undersigned registered holder of the within Call Warrant
hereby sells, assigns and transfers unto the Warrant(s) [Must be whole number]
to purchase Term Assets to which such Call Warrant relates, and appoints
Attorney to make such transfer on the books of the Warrant Agent maintained for
such purpose, with full power of substitution in the premises.
Dated:
(Signature must conform in all respects to name of holder as specified on
the face of Warrant)
(Street Address)
(City)(State)(Zip Code)
Signed in the presence of:
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Schedule 1
To the Call Warrant
$82,840,000 aggregate principal amount of 7% debentures due December 1, 2095
issued by BellSouth Telecommunications, Inc.
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