EXHIBIT 4
PPLUS TRUST CERTIFICATES SERIES RRD-1
FORM OF SERIES SUPPLEMENT
between
XXXXXXX XXXXX DEPOSITOR, INC.,
as Depositor,
and
THE BANK OF NEW YORK,
as Trustee and Securities Intermediary
Dated as of ___________
SERIES SUPPLEMENT, dated as of __________ (the "Supplement"),
by and between XXXXXXX XXXXX DEPOSITOR, INC., a Delaware corporation, as
Depositor, THE BANK OF NEW YORK, a New York corporation, as Trustee and
Securities Intermediary.
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 Supplement, which shall
incorporate the terms of the Standard Terms for Trust Agreements, dated as of
November 5, 2004 (the "Standard Terms" and, together with this Supplement, the
"Trust Agreement"), by and between the Depositor and the Trustee and Securities
Intermediary, as modified by this Supplement;
WHEREAS, the Depositor desires to deposit the Underlying
Securities set forth on Schedule I attached hereto into the Trust;
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 (a) the Certificates evidencing undivided interests in the Trust and
(b) Call Rights;
WHEREAS, the Trustee has joined in the execution of the
Standard Terms and this Supplement to evidence the acceptance by the Trustee of
the Trust; and
WHEREAS, the Securities Intermediary has joined in the
execution of the Standard Terms and this Supplement to evidence the acceptance
by the Securities Intermediary of its obligations thereunder and hereunder;
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 and Securities Intermediary as follows:
Section 1. Incorporation of Standard Terms. All of the
provisions of the Standard Terms, a copy of which is attached hereto as Exhibit
A, are hereby incorporated herein by reference in their entirety and this
Supplement and the Standard Terms shall form a single agreement among the
parties. In the event of any inconsistency between the provisions of this
Supplement and the provisions of the Standard Terms, the provisions of this
Supplement will control with respect to the transactions described herein.
Section 2. Definitions. 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 Supplement
(Section 2(b) hereof sets forth 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.
"Allocation Ratio": The ratio of the Class A Allocation to the
Class B Allocation. Voting Rights, Liquidation Proceeds, Realized Losses and
Extraordinary Trust Expenses shall be allocated between Class A
Certificateholders and Class B Certificateholders in accordance with the
Allocation Ratio and, within each Class, each of the foregoing rights and
obligations shall be allocated to Certificateholders in accordance with their
pro rata interests in such Class.
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"Authorized Denomination": With respect to Certificates, an
aggregate stated and/or notional principal amount of $1,000, as applicable.
"Business Day": Any day that is not a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust companies in the
City of New York are authorized or obligated by law, regulation or executive
order to close and that also is specified as a Business Day with respect to the
Underlying Securities.
"Call Date": Any Business Day that (i) a Call Holder
designates as a Call Date on or after April 15, 2011; (ii) a Call Holder
designates as a Call Date before April 15, 2011 after the announcement of any
Unscheduled Payment of the Underlying Securities or after receipt by the Call
Holder of notice of the termination of the Trust; provided that if a Call Right
is to be exercised after the announcement of any Unscheduled Payment of the
Underlying Securities and prior to such Unscheduled Payment, then the Call Date
designated by the Call Holder must be the third Business Day prior to such
Unscheduled Payment; (iii) at any time is deemed a Call Date upon an
acceleration of the maturity of the Underlying Securities and payment in full by
the Underlying Securities Issuer of all amounts when due; or (iv) at any time in
the case of a tender offer for the Underlying Securities, a Call Holder is
deemed to designate as a Call Date pursuant to Section 2.02(i)(iv) of the
Warrant Agreement.
"Call Holder": The holder of a Class A Call Right or a Class B
Call Right.
"Call Price": The Class A Call Price and the Class B Call
Price.
"Call Right": The Class A Call Right and the Class B Call
Right.
"Certificates": All 2,400,000 Class A Certificates and all
2,400,000 Class B Certificates.
"Class A Allocation": The present value (discounted at the
rate of 6.30% per annum) of (i) the unpaid interest, except for the Class B
Payments, due or to become due on the Underlying Securities on or prior to the
Final Scheduled Distribution Date and (ii) the principal amount of the
Underlying Securities (in each case assuming that the Underlying Securities are
paid in full when due and are not accelerated or redeemed prior to their stated
maturity).
"Class A Call Price": On or after April 15, 2011, means $25
per Class A Certificate being called plus any accrued and unpaid interest on
each Class A Certificate being called to the Call Date. Before April 15, 2011
and after the announcement of any (i) redemption or (ii) other unscheduled
payment of the Underlying Securities or (iii) receipt of notice of termination
of the Trust or (iv) when a tender offer for the Underlying Securities is
pending, means (x) $25.5 per Class A Certificate being called plus any accrued
and unpaid interest on each Class A Certificate being called to the Call Date in
the case of clause (i) above or (x) $25 per Class A Certificate being called
plus any accrued and unpaid interest on each Class A Certificate being called to
the Call Date in the case of clauses (ii), (iii) or (iv) above. Any payments of
interest on the Call Date by the Trust to the applicable Class A
Certificateholder shall be excluded.
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"Class A Call Right": The right, but not the obligation,
pursuant to the Warrant Agreement and any related Warrant Certificates (as
defined in the Warrant Agreement) of one or more Call Holders to purchase from
the Class A Certificateholders on a Call Date some or all, of the Class A
Certificates for the Class A Call Price.
"Class A Certificate Account": The Certificate Account
established for the Class A Certificateholders.
"Class A Certificates": The Certificates issued by the Trust
in a stated amount of $25 per trust certificate, entitled to receive on each
Distribution Date until and including the Final Scheduled Distribution Date,
distributions at a rate of 6.30% per annum on the stated amount of the Class A
Certificates and a cash distribution of the principal amount of the Underlying
Securities on the Final Scheduled Distribution Date and such other distributions
as described herein.
"Class B Allocation": The sum of the present values
(discounted at the rate of 6.30% per annum) of the Class B Payments (assuming,
for purposes hereof, that the Underlying Securities are paid in full on their
stated maturity date, and no portion thereof is accelerated or redeemed prior to
such date).
"Class B Call Price" means the sum of the present values,
discounted at a rate of 6.30% per annum, of the unpaid distributions due, or to
become due, in respect of the Class B Payments to be made on each Class B
Certificate being called on or after the Call Date (assuming, for purposes
hereof, that the Underlying Securities are paid in full on their stated maturity
date, and no portion thereof is accelerated or redeemed prior to such date). Any
payments of interest on the Call Date by the Trust to the applicable Class B
Certificateholder shall be excluded.
"Class B Call Right": The right, but not the obligation,
pursuant to the Warrant Agreement and any related Warrant Certificates (as
defined in the Warrant Agreement) of one or more Call Holders to purchase from
the Class B Certificateholders on a Call Date some or all of the Class B
Certificates for the Class B Call Price.
"Class B Certificate Account": The Certificate Account
established for the Class B Certificateholders.
(a) "Class B Certificates": The Certificates issued by the Trust with the right
to receive, on each Distribution Date, commencing on April 15, 2006 and ending
on the Final Scheduled Distribution Date, a distribution of 0.325% per annum of
the aggregate notional principal amount of Class B Certificates and such other
distributions as described herein.
"Class B Payments" will have the meaning given to it in
Section 3(d).
"Closing Date": March 2, 2006.
"Collection Period": (i) With respect to each October 15
Distribution Date, the period beginning on the day after the April 15
Distribution Date of the current year and ending on such October 15 Distribution
Date, inclusive, and (ii) with respect to each April 15
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Distribution Date, the period beginning on the day after the October 15
Distribution Date of the prior year and ending on such April 15 Distribution
Date, inclusive, except for the April 15, 2006 Distribution Date, as to which
the Collection Period shall be the period beginning on the Cut-off Date and
ending on such April 15, 2006 Distribution Date, inclusive; provided, however,
that clauses (i) and (ii) shall be subject to Section 9(c) hereof.
"Commission": The United States Securities and Exchange
Commission.
"Corporate Trust Office": The office of the Trustee located at
000 Xxxxxxx Xxxxxx, Xxxxx 0X, Xxx Xxxx, XX 00000, Attention: Corporate Trust
Dealing & Trading Group; provided, however, that the office at which
certificated securities are delivered for registration of transfer, cancellation
or exchange shall be the office of the Trustee, located at 000 Xxxxxxx Xxxxxx,
Xxxxx 0X, Xxx Xxxx, XX 00000.
"Cut-off Date": March 2, 2006
"Delivery Certificates" has the meaning given to it in Section
2.02 of the Warrant Agreement.
"Depository": The Depository Trust Company, its nominees and
their respective successors.
"Distribution Date": April 15 and October 15 of each year (or
if such date is not a Business Day, the next succeeding Business Day),
commencing on April 15, 2006 and ending on the Final Scheduled Distribution
Date.
"Distribution Election": (a) If there occurs an Event of
Default (as defined in the Underlying Securities Indenture) on the Underlying
Securities under clauses (1) or (2) of the definition in Section 501 of the
Underlying Securities Indenture, then the Trustee, upon receiving notice of such
event, shall, on or immediately after the 30th day after such event, direct the
Market Agent to sell the Underlying Securities and a pro rata portion of the
Related Assets held by the Trust, in accordance with the Sale Procedures, and
the Liquidation Proceeds, if any, shall be divided between the Classes in
accordance with the Allocation Ratio and each Class' portion shall be deposited
into such Class' Certificate Account and distributed to such Class'
Certificateholders pro rata on the first Business Day following such deposit
into such Certificate Account.
(b) If, prior to the day on which the Market Agent sells the
Underlying Securities pursuant to paragraph (a) above, there occurs (and the
trustee receives notice of such occurrence) an acceleration of the maturity of
the Underlying Securities and the Underlying Securities are declared to be
immediately due and payable in accordance with the Underlying Securities
Indenture, and the Underlying Securities Issuer:
(i) makes full payment of all amounts when due, and such
payment exceeds the sum of (x) the aggregate stated amount of the Class
A Certificates plus any accrued and unpaid distributions to the date of
payment and (y) the sum of the present values, discounted at the rate
of 6.30% per year, of the unpaid payments due, or to become due, in
respect of the Class B Payments to be made on the Class B Certificates
on or after the
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date of payment (assuming, for purposes of such calculation, that the
Underlying Securities would have been paid in full at their stated
maturity, that such acceleration had not occurred, and that no portion
thereof would have been redeemed prior to such maturity date) then all
holders of outstanding Call Rights will be deemed to have exercised
their Call Rights automatically, and the Trustee, upon receiving such
acceleration proceeds from the Underlying Securities Issuer, shall, on
the first Business Day following receipt of such acceleration proceeds,
distribute from such acceleration proceeds the following amounts:
(A) the Class A Call Price or the Class B Call Price
per Certificate, as applicable, shall be distributed from such
payment on account of each Certificate called from the holder
thereof (which holders, pursuant to Section 2.02(d) of the
Warrant Agreement, shall exclude Certificateholders to whom
Delivery Certificates (as defined in the Warrant Agreement)
were delivered in accordance with Section 2.02(d) of the
Warrant Agreement),
(B) for each Class A Certificate, $25.00 plus any
accrued and unpaid interest on such Class A Certificate to
that date of payment, or, for each Class B Certificate, the
sum of the present values, discounted at the rate of 6.30% per
annum, of the unpaid distributions that were due, or to become
due, in respect of the Class B Payments to be made on such
Class B Certificate on or after the date of payment (assuming,
for purposes of such calculation, that the Underlying
Securities would have been paid in full on their stated
maturity, and that such acceleration had not occurred, and
that no portion thereof would have been redeemed prior to such
stated maturity date), as applicable, shall be distributed
from such payment on account of each Certificate held by
Certificateholders to whom Delivery Certificates were
delivered in accordance with Section 2.02(d) of the Warrant
Agreement, and
(C) any amounts remaining shall be divided between
the Classes in accordance with the Allocation Ratio and each
Class' portion shall be distributed pro rata among the Call
Holders that are deemed to have exercised their Call Rights
automatically pursuant to this clause with respect to that
Class and the Certificateholders of that Class to whom
Delivery Certificates were delivered in accordance with
Section 2.02(d) of the Warrant Agreement;
If the payment to be made by the Underlying
Securities Issuer does not exceed the threshold set forth
above, the Trustee shall divide the amount of such payment
between the Trust Certificate Classes in accordance with the
Allocation Ratio and distribute each Class's portion of such
amounts pro rata to the Trust Certificateholders of that
Class.
(ii) makes a partial payment of all amounts when due, then the
Trustee, upon receiving such payment, shall:
(A) immediately divide such payment between the
Classes in accordance with the Allocation Ratio and deposit
each Class' portion of such payment into
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that Class' Certificate Account for distribution to such
Class' Certificateholders pro rata on the first Business Day
following such deposit into such Certificate Account;
provided, that if the Underlying Securities Issuer places any
condition, restriction or obligation on the acceptance of such
partial payment including but not limited to a waiver of any
right granted to a holder of the Underlying Securities, such
partial payment will be rejected by the Trustee and no deposit
will be made into the Certificate Account,
(B) divide a principal amount of the Underlying
Securities equal to the aggregate stated amount of the
outstanding Class A Certificates between the Classes in
accordance with the Allocation Ratio and distribute each
Class' portion of the Underlying Securities to such Class'
Certificateholders pro rata and divide a pro rata portion of
the Related Assets between the Classes in accordance with the
Allocation Ratio and distribute each Class' portion of such
Related Assets to such Class' Certificateholders pro rata to
each Certificateholder's last address as it appears in the
Certificate Register within three Business Days of receiving
said notice, and
(C) if any Underlying Securities are not distributed
pursuant to clause (B), immediately direct the Market Agent to
sell all Underlying Securities not so distributed and a pro
rata portion of the Related Assets held by the Trust, in
accordance with the Sale Procedures, and the Liquidation
Proceeds, if any, shall be divided between the Classes in
accordance with the Allocation Ratio and each Class' portion
shall be deposited into such Class' Certificate Account and
distributed to such Class' Certificateholders pro rata on the
first Business Day following such deposit into such
Certificate Account; or
(iii) fails to make such payment when due, then the Trustee,
upon receiving notice of such failure to make payment, shall:
(A) divide a principal amount of Underlying
Securities equal to the aggregate stated amount of the
outstanding Class A Certificates and a pro rata portion of the
Related Assets in accordance with the Allocation Ratio between
the Classes in accordance with the Allocation Ratio and
distribute each Class' portion to such Class'
Certificateholders pro rata to each Certificateholder's last
address as it appears in the Certificate Register within three
Business Days of receiving said notice, and
(B) if any Underlying Securities are not distributed
pursuant to clause (A), immediately direct the Market Agent to
sell all Underlying Securities not so distributed and a pro
rata portion of the Related Assets held by the Trust, in
accordance with the Sale Procedures, and the Liquidation
Proceeds, if any, shall be divided between the Classes in
accordance with the Allocation Ratio and each Class' portion
shall be deposited into such Class' Certificate Account and
distributed to such Class' Certificateholders pro rata on the
first Business Day following such deposit into such
Certificate Account.
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(c) If the Underlying Securities Issuer of any Concentrated
Underlying Securities ceases to be a reporting company under the Exchange Act,
and no parent guarantor of such Underlying Securities Issuer, if any, includes
in its Exchange Act reports condensed consolidating financial statements setting
forth financial information for the Underlying Securities Issuer, then the
Trustee, upon receiving notice of such event shall (A) divide a principal amount
of Underlying Securities equal to the aggregate stated amount of the outstanding
Class A Certificates and a pro rata portion of the Related Assets in accordance
with the Allocation Ratio between the Classes in accordance with the Allocation
Ratio and distribute each Class' portion to such Class' Certificateholders pro
rata to each Certificateholder's last address as it appears in the Certificate
Register within three Business Days of receiving said notice, and (B) if any
Underlying Securities are not distributed pursuant to clause (A), immediately
direct the Market Agent to sell all Underlying Securities not so distributed and
a pro rata portion of the Related Assets held by the Trust, in accordance with
the Sale Procedures, and the Liquidation Proceeds, if any, shall be divided
between the Classes in accordance with the Allocation Ratio and each Class'
portion shall be deposited into such Class' Certificate Account and distributed
to such Class' Certificateholders pro rata on the first Business Day following
such deposit into such Certificate Account.
(d) Upon receiving (A) notice of an acceleration of the date
of maturity of the Underlying Securities and the Underlying Securities Issuer's
partial payment of all amounts when due as described in subsection (ii) of
clause (b) above, or (B) notice of the events set forth in clause (c) above, the
Trustee shall, 10 days prior to the exercise of any remedy, provide written
notice of the termination of the Trust to the Call Holders. Notwithstanding
subsection (ii) of clause (b) and clause (c), the Trustee shall not distribute
any such partial payment, Underlying Securities or Related Assets to any
Certificateholders before the earlier of (i) the expiration of the 10-day notice
of termination period, and (ii) receipt by the Trust of notice of all Call
Holders' election to exercise their Class A Call Right or Class B Call Right, as
applicable. If less than all outstanding Class A Call Rights or Class B Call
Rights are exercised, upon receiving such notice of election, the Trustee shall
select by lot (or by such other reasonable procedure as may be established by
the Trustee) for purchase by such exercising Call Holders in the case of Class A
Certificates the stated amount of Class A Certificates equal to the stated
amount of Class A Call Rights being exercised multiplied by the aggregate stated
amount of the outstanding Class A Certificates not subject to Delivery
Certificates divided by the aggregate stated amount of the outstanding Class A
Call Rights or, in the case of Class B Certificates, the aggregate notional
principal amount of Class B Certificates equal to the aggregate notional
principal amount of Class B Call Rights being exercised multiplied by the
aggregate notional principal amount of the outstanding Class B Certificates not
subject to Delivery Certificates divided by the aggregate notional principal
amount of the outstanding Class B Call Rights. The Certificateholders of the
Trust Certificates to be purchased shall not be entitled to any right other than
the right to receive payment of an amount equal to the applicable Call Price on
the date the applicable Call Rights are exercised, and such Trust Certificates
shall be deemed to have been automatically surrendered by the Certificateholders
to the Trust for further transfer to the exercising Call Holders. The share of
the payment, Underlying Securities and Related Assets to be distributed with
respect to such called Trust Certificates shall be distributed to the exercising
Call Holders. In the case of a sale by the Market Agent of Underlying Securities
and Related Assets pursuant to clause (a) above, the Trustee shall deliver such
Underlying Securities and
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Related Assets to the purchaser of such Underlying Securities and Related Assets
only against payment in same day funds and the Trustee shall deposit the same
into the Certificate Account.
"Eligible Investments": As defined in the Standard Terms;
provided, however, that (i) the minimum required rating for long-term
instruments will be equal to the lower of the rating of the Underlying
Securities or the Trust Certificates, and (ii) the rating of any short-term
instruments will be A-1+ by S&P and P1 by Xxxxx'x; and provided, further, that
any such investment matures no later than the Business Day prior to the next
succeeding Distribution Date.
"Escrow Agent": As will be set forth in the Escrow Agreement.
"Escrow Agreement": The escrow agreement to be entered into on
the Exercise Date among a given Call Holder, the Trustee and the Escrow Agent
pursuant to Section 14(b)(iii)(2) hereof.
"Event of Default": (i) A default in the payment of any
interest on any Underlying Security after the same becomes due and payable
(subject to any applicable grace period), (ii) a default in the payment of the
principal of or any installment of principal of any Underlying Security when the
same becomes due and payable and (iii) any other event specified as an event of
default in the Underlying Securities Indenture. For a summary of certain events
of default in the Underlying Securities Indenture, please refer to the
Prospectus Supplement.
"Exercise Date": any date on which a Call Holder notifies the
Trustee of its intention to exercise its Call Right in accordance with the
provision of Section 14(b)(iii), any date a Call Holder is deemed to have
exercised its Call Right pursuant to Section 2.02(i)(iv) of the Warrant
Agreement, or any date following the acceleration of the maturity of the
Underlying Securities and payment in full of all amounts when due by the
Underlying Securities Issuer.
"Final Scheduled Distribution Date": April 15, 2029 (or if
such date is not a Business Day, the next succeeding Business Day).
"Fixed Pass-Through Rate": With respect to the Class A
Certificates, 6.30% per annum and with respect to the Class B Certificates,
0.325% per annum.
"Optional Exchange Date": Any Distribution Date or such date
as is designated pursuant to Section 7(b) hereof.
"Ordinary Expenses": The compensation due to the Trustee for
Ordinary Expenses as defined in the Standard Terms, which, with respect to
Ordinary Expenses other than those referred to in clause (iii) of such
definition and other than the costs of converting to XXXXX format the periodic
reports required for the Trust under the Exchange Act, shall be fixed at $2,000
per annum.
"Pass-Through Rate": For each Class of Certificates, the
associated Fixed Pass-Through Rate.
"Prepaid Ordinary Expenses": Zero (0).
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"Prospectus Supplements": The Prospectus Supplement dated
February 23, 2006 relating to the Class A Certificates and the Prospectus
Supplement dated February 24, 2006 relating to the Class B Certificates.
"Rating Agency": Xxxxx'x and S&P
"Record Date": The Business Day immediately preceding each
Distribution Date.
"Regulation AB": Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from
time to time, and subject to such clarification and interpretation as have been
provided by the Commission in the adopting release (Asset-Backed Securities,
Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or
by the staff of the Commission, or as may be provided by the Commission or its
staff from time to time.
"Series": PPLUS Trust Series RRD-1.
"Underlying Securities": The $60,000,000 aggregate principal
amount of 6 5/8% Debentures due 2029 issued by the Underlying Securities Issuer,
as described in Schedule I hereto.
"Underlying Securities Indenture": As set forth in Schedule I.
"Underlying Securities Issuer": R.R. Xxxxxxxx & Sons Company.
"Warrant Agreement": The Warrant Agreement, dated as of March
2, 2006, by and between the Trust and the Warrant Agent (as defined in the
Warrant Agreement).
(b) The terms listed below are not applicable to this Series.
"Accounting Date"
"Administration Account"
"Administrative Agent"
"Administration Agreement"
"Administrative Agent Termination Event"
"Advance"
"Calculation Agent"
"Eligible Expense"
"Exchange Rate Agent"
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"Floating Pass-Through Rate"
"Letter of Credit"
"Limited Guarantor"
"Limited Guaranty"
"Notional Amount"
"Reserve Account"
"Requisite Reserve Amount"
"Retained Interest"
"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 (a) The Trust
created hereby shall be known as the "PPLUS Trust Series RRD-1". The Class A
Certificates and Class B Certificates evidencing certain undivided ownership
interests therein shall be known as the "PPLUS Class A 6.30% Callable Trust
Certificates Series RRD-1" and the "PPLUS Class B 0.325% Callable Trust
Certificates Series RRD-1," respectively.
(b) The Class A Certificates and Class B Certificates shall be
held through the Depository in book-entry form and shall be substantially in the
form attached hereto as Exhibits B and C, respectively. The Class A Certificates
shall be issued in authorized denominations of $25 and integral multiples
thereof and the Class B Certificates shall be issued with a notional principal
amount of $25 and integral multiples thereof. Except as provided in the Standard
Terms, the Trust shall not issue additional Certificates or incur any
indebtedness. Notwithstanding anything to the contrary in the Trust Agreement,
the Depositor may not increase the amount of the Underlying Securities in the
Trust and the Trust may not issue a corresponding amount of additional
Certificates.
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(c) The Class A Certificates will be entitled to receive (i)
on each Distribution Date, commencing on April 15, 2006 and ending on the Final
Scheduled Distribution Date, or such earlier date if the Underlying Securities
are redeemed prior to the Final Scheduled Distribution Date, distributions at a
rate of 6.30% per annum on the stated amount of the Class A Certificates and
(ii) on the Final Scheduled Distribution Date, a distribution of the aggregate
principal amount of the Underlying Securities.
(d) On each Distribution Date, the Class B Certificates will
be entitled to receive a distribution of 0.325 per annum multiplied by the
notional principal amount of the Class B Certificates (the "Class B Payments").
(e) Any reference to the principal amount of the Certificates
shall be construed as a reference to the stated amount of the Class A
Certificates and/or the notional principal amount of the Class B Certificates,
unless otherwise indicated.
Section 4. Satisfaction of Conditions to Initial Execution and
Delivery of Trust Certificates. The Trustee hereby acknowledges receipt, on or
prior to the Closing Date, of:
(i) the Underlying Securities set forth on Schedule I hereto;
and
(ii) all documents set forth in Section 5.12 of the Standard
Terms except that clauses (v), (vi) and (vii) of Section 5.12(a) shall
not apply to this Series.
Section 5. Distributions. (a) On each Distribution Date, the
Trustee shall apply the funds in the Certificate Account, solely to the extent
of Available Funds in the Certificate Account, as follows:
(i) first, to the Trustee, reimbursement for any approved
Extraordinary Trust Expenses incurred by the Trustee in accordance with
Section 6(b) hereof and approved by not less than 100% of the
Certificateholders;
(ii) second, pro rata to the holders of the Class A
Certificates and Class B Certificates, distributions accrued during the
related Collection Period at the rate of 6.30% per annum on the stated
amount of the Class A Certificates to holders of the Class A
Certificates on such Distribution Date and 0.325% per annum multiplied
by the notional principal amount of Class B Certificates to holders of
the Class B Certificates on such Distribution Date, commencing on April
15, 2006 and ending on the Final Scheduled Distribution Date;
(iii) third, divided between the Classes in accordance with
the proportionate interest of each Class in any delayed interest
payments on the Underlying Securities (i.e., 6.300/6.325 to the Class A
Certificateholders and 0.325/6.325 to the Class B Certificateholders)
and each Class' portion distributed to the holders of each Class pro
rata, if available, any additional payments paid by the Underlying
Securities Issuer as a result of a delay in the receipt by the Trustee
of any interest payment on the Underlying Securities;
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(iv) fourth, pro rata to the Class A Certificateholders, on
the Final Scheduled Distribution Date only, a distribution of the
aggregate principal amount of the Underlying Securities;
(v) fifth, to the extent there remain Available Funds in the
Certificate Account, to any creditors of the Trust in satisfaction of
liabilities thereto; and
(vi) sixth, to the extent there remain Available Funds in the
Certificate Account, to Xxxxxxx Xxxxx Capital Services, Inc. and if no
Available Funds remain in the Certificate Account then no distribution
will be made pursuant to this Section 5(a)(vi).
Subject to Section 9(c) hereof, to the extent Available Funds are insufficient
to make any required distributions due to the Certificates on any Distribution
Date, any shortfall will be carried over and will be distributed on the next
Distribution Date on which sufficient funds are available on the Available Funds
to pay such shortfall. Neither Xxxxxxx Xxxxx & Co. nor any of its Affiliates
will have any claim against the Trust pursuant to Section 5(a)(vi) if the Trust
fails to make a distribution on a Distribution Date to such person because no
Available Funds remain in the Certificate Account on such Distribution Date.
(b) On an Optional Exchange Date, the Trustee shall distribute
to Xxxxxxx Xxxxx & Co. or any of its Affiliates, other than the Depositor, or
any other Person exercising an optional exchange pursuant to Section 7 hereof,
as the case may be, Underlying Securities in accordance with Section 7 hereof.
Section 6. Trustee's Fees; Escrow Agent's Fees. (a) Payment to
the Trustee of Ordinary Expenses shall be as set forth in a separate agreement
between the Trustee and the Depositor. The Trustee agrees that in the event
Ordinary Expenses are not paid in accordance with such agreement, it shall (i)
not have any claim or recourse against the Trust or the property of the Trust
with respect thereto and (ii) continue to perform all of its services as set
forth herein unless it elects to resign as Trustee in accordance with Section
7.08 of the Standard Terms.
(b) Extraordinary Trust Expenses shall not be paid out of the
Deposited Assets unless (i) the Trustee is satisfied that it will have adequate
security or indemnity in respect of such costs, expenses and liabilities, and
(ii) all the Certificateholders of Certificates then outstanding have voted to
require the Trustee to incur such Extraordinary Trust Expenses. If Extraordinary
Trust Expenses are not approved unanimously as set forth in clause (ii), such
Extraordinary Trust 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. In addition, if the
conditions in (i) and (ii) are not both satisfied, the Trustee shall not be
obligated to incur any Extraordinary Trust Expense.
(c) In the event that one or more Call Holders is required to
deposit the applicable Call Price with the Escrow Agent on the Exercise Date
pursuant to Section 14(c)(iii)(2) hereof, the Depositor and the Escrow Agent
shall enter into an agreement reasonably acceptable to both parties thereto
whereby the Depositor shall pay to the Escrow Agent a fee in consideration for
its services under the Escrow Agreement or Escrow Agreements, as applicable.
13
Section 7. Optional Exchange. (a) Xxxxxxx Xxxxx & Co. or any
of its Affiliates (other than the Depositor), if it holds Certificates, or any
other (i) Person or (ii) group of Affiliated Persons (in each case other than
the Depositor) holding Class A Certificates with an aggregate stated amount of
$5 million or more and an equal aggregate notional principal amount of Class B
Certificates, all acquired pursuant to the exercise of Class A Call Rights or
Class B Call Rights held by it, (provided that, in the case of a group of
Affiliated Persons, no single Affiliated Person holds Class A Certificates with
an aggregate stated amount of less than $500,000 and Class B Certificates with a
notional principal amount of less than $500,000 acquired pursuant to the
exercise of Class A Call Rights or Class B Call Rights, as applicable, held by
it) may notify the Trustee, not less than 30 days but not more than 60 days
prior to any Optional Exchange Date, that:
(i) such Person intends or Affiliated Persons intend to tender
an Authorized Denomination of Class A Certificates and an equal number
of Class B Certificates that it holds or they hold to the Trustee on
such Optional Exchange Date in exchange for a proportional amount of
Underlying Securities;
(ii) such exchange will not cause the Trust or Depositor to
fail to satisfy the applicable requirements for exemption under Rule
3a-7 under the Investment Company Act of 1940, as amended;
(iii) such exchange will not affect the characterization of
the Trust as a "grantor trust" under the Code;
(iv) in the case of an exchange of less than all outstanding
Certificates, such exchange will not cause a failure to satisfy the
minimum requirements for the Class A Certificates to remain listed on
the New York Stock Exchange, unless the Person or Affiliated Persons
tendering such Certificates will hold all remaining outstanding
Certificates upon completion of the exchange of such Certificates
pursuant to this Section 7;
(v) such exchange will not be made with respect to
Certificates subject to outstanding Call Rights held by any Person or
Affiliated Persons other than the Person or Affiliated Persons
exercising such exchange; and
(vi) in the case of an exchange by a person other xxxx Xxxxxxx
Xxxxx & Co. or any of its Affiliates (other than the Depositor), such
exchange will be made with respect to an aggregate stated amount of
Class A Certificates equal to the aggregate stated amount of Class A
Certificates acquired by such Person or Affiliated Persons pursuant to
the exercise of the applicable Call Rights held by it or them.
Upon tender of such Class A Certificates and Class B Certificates on such
Optional Exchange Date, the Trustee will deliver to the Person or Affiliated
Persons tendering such Certificates an amount of Underlying Securities having a
principal amount equal to the aggregate principal amount of Underlying
Securities then held by the Trust times the aggregate stated amount of Class A
Certificates being tendered divided by the aggregate stated amount of Class A
Certificates then outstanding, and in the case of an exchange by Xxxxxxx Xxxxx &
Co. or any of
14
its Affiliates, where such Person or Affiliated Person holds
unexercised Class A Call Rights respecting the exchanged Class A Certificates
and a corresponding number of unexercised Class B Call Rights respecting the
exchanged Class B Certificates, such unexercised Class A Call Rights and Class B
Call Rights held by such Person or Affiliated Person shall be cancelled. Any
Call Holder that has properly provided notice of exercise to the Warrant Agent
and has deposited the Call Price with the Escrow Agent may concurrently
designate an Optional Exchange Date, and such Optional Exchange Date shall be
specified in the notice of exercise, provided, however, that such Optional
Exchange Date shall not occur prior to the applicable Call Date.
(b) When a tender offer for the Underlying Securities is
pending, Xxxxxxx Xxxxx & Co. or any of its Affiliates (other than the
Depositor), if it holds Certificates, or any other Person or Affiliated Persons
(other than the Depositor, or an Affiliate of the Person making such tender
offer) holding Class A Certificates with an aggregate stated amount of $5
million or more and an equal aggregate notional principal amount of Class B
Certificates, all acquired pursuant to the exercise of the applicable Call
Rights held by it (provided that, in the case of a group of Affiliated Persons,
no single Affiliated Person holds Class A Certificates with an aggregate stated
amount of less than $500,000 and Class B Certificates with a notional principal
amount of less than $500,000 acquired pursuant to the exercise of Class A Call
Rights or Class B Call Rights, as applicable, held by it), may notify the
Trustee, not less than 5 days but not more than 60 days prior to any such
Optional Exchange Date as they may designate, that:
(i) such Person intends or such Affiliated Persons intend to
tender an Authorized Denomination of Class A Certificates with an
aggregate stated amount of $5 million or more and a corresponding
number of Class B Certificates that it holds or they hold to the
Trustee on such Optional Exchange Date in exchange for a proportional
amount of Underlying Securities;
(ii) such exchange will not cause the Trust or Depositor to
fail to satisfy the applicable requirements for exemption under Rule
3a-7 under the Investment Company Act of 1940, as amended;
(iii) such exchange will not affect the characterization of
the Trust as a "grantor trust" under the Code,
(iv) in the case of an exchange of less than all outstanding
Certificates, such exchange will not cause a failure to satisfy the
minimum requirements for the Certificates to remain listed on the New
York Stock Exchange, unless the Person or Affiliated Persons tendering
such Certificates will hold all remaining outstanding Certificates upon
completion of the exchange of such Certificates pursuant to this
Section 7;
(v) such exchange will not be made with respect to
Certificates subject to outstanding Call Rights held by any Person or
Affiliated Persons other than the Person or Affiliated Persons
exercising such exchange; and
(vi) in the case of an exchange by a person other xxxx Xxxxxxx
Xxxxx & Co. or any of its Affiliates (other than the Depositor), such
exchange will be made with
15
respect to an aggregate stated amount of Class A Certificates equal to
the aggregate stated amount of Class A Certificates acquired by such
Person or Affiliated Persons pursuant to the exercise of Call Rights
held by it or them.
Upon tender of such Class A Certificates and Class B Certificates on such
Optional Exchange Date, the Trustee will deliver to the Person or Affiliated
Persons tendering such Certificates an amount of Underlying Securities having a
principal amount equal to the aggregate principal amount of Underlying
Securities then held by the Trust times the aggregate stated amount of Class A
Certificates being tendered divided by the aggregate stated amount of Class A
Certificates then outstanding, and in the case of an exchange by Xxxxxxx Xxxxx &
Co. or any of its Affiliates, where such Person or Affiliated Person holds
unexercised Class A Call Rights respecting the exchanged Class A Certificates
and a corresponding number of unexercised Class B Call Rights respecting the
exchanged Class B Certificates, such unexercised Class A Call Rights and Class B
Call Rights held by such Person or Affiliated Person shall be cancelled.
(c) The requirements set forth in paragraphs (a)(ii), (a)(v)
and (a)(vi) of Section 4.07 of the Standard Terms do not apply to an Optional
Exchange pursuant to this Section 7.
(d) Any costs associated with the exercise of the rights
granted under paragraphs (a) and (b) of this Section 7 will be borne by the
Person or Affiliated Persons exercising such rights and not by the Trust.
(e) In no event can an Optional Exchange be made unless an
equal number of Class A and Class B Certificates are tendered for exchange by
each Holder exercising this Optional Exchange right.
Section 8. Events of Default. Within 30 days of its receipt of
notice of the occurrence of an Event of Default, the Trustee will give notice to
the Certificateholders, transmitted by mail, of all such uncured or unwaived
Events of Default actually known to it. However, unless there is 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; provided, however, that the Trustee shall
give notice of an Event of Default to the extent required under "Distribution
Election."
Section 9. Assessment of Compliance by Trustee; Annual
Independent Certified Public Accountant's Report.. (a) On or prior to March 1st
of each year, commencing with the year following the year of issuance of the
Certificates, the Trustee will be required to deliver to the Depositor an
Assessment of Compliance (or other such form that may be reasonably requested by
the Depositor from the Trustee to conform to the requirements of Regulation AB
the Securities Act of 1933) that contains the following:
(i) a statement of the Trustee's responsibility for assessing
compliance with the servicing criteria applicable to it under the Trust
Agreement;
16
(ii) a statement that the Trustee used the criteria in Item
1122(d) of Regulation AB (17 CFR 229.1122) to assess compliance with
the applicable servicing criteria under the Trust Agreement;
(iii) the Trustee's assessment of compliance with the
applicable servicing criteria during and as of the end of the prior
calendar year, setting forth any material instance of noncompliance
identified by the Trustee; and
(iv) a statement that a registered public accounting firm has
issued an attestation report on the Trustee's assessment of compliance
with the applicable servicing criteria under the trust agreement during
and as of the end of the prior calendar year.
(b) The Trustee shall cause a firm of independent certified
public accountants to deliver to the Depositor on or before March 1st a report
that attests to, and reports on, the Trustee's assessment delivered pursuant to
Section 9(b), which attestation report shall be made in accordance with the
requirements of Rule 15d-18 under the Exchange Act.
(c) On or before [March 1] of each calendar year, commencing
in 2007, the Trustee shall deliver to the Depositor a statement of compliance
addressed to the Depositor and signed by an authorized officer of the Trustee,
to the effect that (i) a review of the Trustee's activities during the
immediately preceding calendar year (or applicable portion thereof) and of its
performance under the Trust Agreement during such period has been made under
such officer's supervision, and (ii) to the best of such officers' knowledge,
based on such review, the Trustee has fulfilled all of its obligations under the
Trust Agreement in all material respects throughout such calendar year (or
applicable portion thereof) or, if there has been a failure to fulfill any such
obligation in any material respect, specifically identifying each such failure
known to such officer and the nature and the status thereof.
Section 10. Miscellaneous. (a) The provisions of Section 4.04,
Advances, of the Standard Terms shall not apply to the Certificates.
(b) The Certificateholders shall not be entitled to terminate
the Trust or cause the sale or other disposition of the Underlying Securities;
provided, however, that Certificateholders holding all, but not less than all,
of the outstanding Certificates may exercise their rights under Section 13(b)
with respect to all such Certificates.
(c) 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 Certificateholders and Class B
Certificateholders, proportionately to the ratio of their respective
entitlements to interest payments.
(d) The outstanding principal balance of the Class A
Certificates and the aggregate notional principal amount of the Class B
Certificates shall not be reduced by the amount of any Realized Loss.
17
(e) 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 Deposited Assets and the issuance of the Certificates and Call
Rights, 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
Call Rights, or otherwise incur, assume or guarantee any indebtedness for money
borrowed.
(f) The Trust may not consolidate, amalgamate, merge with or
into, or be replaced by or convey, transfer or lease its properties and assets
substantially as an entirety to, any another entity or permit any other entity
to consolidate, amalgamate, merge with or into, or replace the Trust.
(g) Except as expressly provided in the Trust Agreement, the
Trust may not sell the Underlying Securities.
(h) If the Trustee resigns or is removed as Trustee in
accordance with Section 7.08 of the Trust Agreement, in addition to providing
the Depositor with written notice, the Trustee shall also provide the Rating
Agencies with written notice.
(i) Xxxxxxx Xxxxx & Co. shall act as the Market Agent and
shall serve in such capacity in accordance with the terms of the Market Agent
Agreement attached hereto as Exhibit D.
(j) Notwithstanding anything in the Trust Agreement to the
contrary, the Trustee may be removed upon 60 days prior written notice delivered
by Certificateholders holding Certificates that represent the Required
Percentage-Removal, and such removal shall take effect upon the appointment of a
successor Trustee and its acceptance of such appointment as provided in the
Trust Agreement.
Section 11. Notices. (a) 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:
Xxxxxxx Xxxxx Depositor, Inc.
c/x Xxxxxxx Xxxxx & Co.
World Financial Center
New York, NY 10080
Attention: Xxxxxxx Xxxxxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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If to the Trustee, to:
The Bank of New York
Corporate Trust Dealing & Trading Group
000 Xxxxxxx Xxxxxx, Xxxxx 0X
Xxx Xxxx, XX 00000
Attention: PPLUS Trust Series RRD-1
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Securities Intermediary, to:
The Bank of New York
Corporate Trust Dealing & Trading Group
000 Xxxxxxx Xxxxxx, Xxxxx 0X
Xxx Xxxx, XX 00000
Attention: PPLUS Trust Series RRD-1
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Warrant Agent, to
The Bank of New York
Corporate Trust Dealing & Trading Group
000 Xxxxxxx Xxxxxx, Xxxxx 0X
Xxx Xxxx, XX 00000
Attention: PPLUS Trust Series RRD-1
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Rating Agencies, to:
Xxxxx'x Investors Service, Inc.
00 Xxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: CBO/CLO Monitoring Department
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and to:
19
Standard & Poor's
00 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Structured Finance Surveillance Group
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(b) Copies of any tender offer materials and all directions,
demands and notices required to be given to the Certificateholders hereunder or
under the Standard Terms will be given to the Warrant Agent by facsimile
transmission and by mail.
Section 12. Governing Law. This Supplement and the
transactions described herein shall be construed in accordance with and governed
by the laws of the State of New York.
Section 13. Counterparts. This 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 14. Termination of the Trust. (a) The Trust shall
terminate upon the earlier of (i) the payment in full at maturity or sale by the
Trust after a payment default on the Underlying Securities and the distribution
in full of all amounts due to the Certificateholders, (ii) the distribution to
the Certificateholders of all Underlying Securities in accordance with the
Distribution Election, (iii) the exchange of all outstanding Certificates for
Underlying Securities pursuant to one or more Optional Exchanges, (iv) the Final
Scheduled Distribution Date and (v) the holders of all, but not less than all,
of the Certificates exercising their election in Section 13(b) below.
(b) Certificateholders who hold all, but not less than all, of
the outstanding Certificates may, upon prior written notice to the Rating
Agencies, elect to terminate the Trust at any time; provided that (i) the
exercise of such termination right would not cause the Trust or the Depositor to
fail to satisfy the applicable requirements for exemption under Rule 3a-7 under
the Investment Company Act of 1940, as amended and (ii) if and for so long as
the call warrants remain outstanding, all of the Call Holders have consented to
such termination.
(c) To the extent that the provisions of this Section 13
conflict with Section 10.01 of the Standard Terms, the latter shall control.
Section 15. Sale or Unscheduled Payment of Underlying
Securities; Call Right. (a) In the case of Extraordinary Trust Expenses approved
by 100% of the Certificateholders of each Class, pursuant to Section 6(b)
hereof, the Trustee may, upon prior written notice to the Rating Agencies, elect
to sell all or a portion of the Underlying Securities to pay such Extraordinary
Trust Expenses.
(b) The Trust, as a holder of the Underlying Securities, may
receive unscheduled proceeds (the "Unscheduled Payment Amount") upon an
Unscheduled Payment in full or in part of the Underlying Securities by the
Underlying Securities Issuer. (i) Upon receiving an Unscheduled Payment of the
Underlying Securities in full, but not in part, the Trust shall distribute the
Unscheduled Payment Amount first, pro rata to the Class A
20
Certificateholders until each shall have received the stated amount of each
Class A Certificate it holds plus accrued and unpaid distributions on the Class
A Certificates to the date of payment of the Unscheduled Payment Amount (the
"Unscheduled Payment Date"); second, pro rata to the Class B Certificateholders
until each shall have received the sum of the present values (discounted at the
rate of 6.30 per annum) of the Class B Payments on or after the Unscheduled
Payment Date (assuming, for purposes of such calculation, that the Underlying
Securities would have been paid in full on their stated maturity with no such
Unscheduled Payment or acceleration); and third, any remaining Unscheduled
Payment Amount will be divided between the Classes of trust certificates in
accordance with a percentage equal to 6.300/6.325 of such amount to the Class A
Certificateholders and 0.325/6.325 of such amount to the Class B
Certificateholders, and within each class the Unscheduled Payment Amount will be
distributed pro rata to the Certificateholders of the Class A or Class B
Certificates entitled to such Unscheduled Payment Amount upon the date such
Unscheduled Payment Amount is received in immediately available funds by the
Trust if such Unscheduled Payment Amount is received prior to 1:00 p.m. local
time at the office of the Trustee and otherwise on the next Business Day. (ii)
Upon any Unscheduled Payment of the Underlying Securities in part, the Trustee
shall select by lot (or by such other reasonable procedure as may be established
by the Trustee) a stated amount of Class A Certificates and an equal notional
principal amount of Class B Certificates equal to the aggregate amount of each
Class of Certificates then outstanding multiplied by the aggregate principal
amount of Underlying Securities subject to the Unscheduled Payment and then held
by the Trust divided by the aggregate principal amount of Underlying Securities
then held by the Trust; provided that the amount of each Class of Trust
Certificates being selected by lot may be reduced by the aggregate stated amount
of Class A Certificates or notional principal amount of Class B Certificates, as
applicable, called pursuant to the exercise of Call Rights prior to such
Unscheduled Payment in accordance with the terms of the Warrant Agreement. Upon
receiving such Unscheduled Payment Amount, the Trust shall distribute the
Unscheduled Payment Amount, first, pro rata to the Class A Certificateholders
selected by lot pursuant to this subsection until each shall have received the
stated amount of each Class A Certificate it holds plus accrued and unpaid
distributions on the Class A Certificates to the Unscheduled Payment Date;
second, pro rata to the Class B Certificateholders selected by lot pursuant to
this subsection until each shall have received the sum of the present values
(discounted at the rate of 6.30 per annum) of the Class B Payments on or after
the Unscheduled Payment Date (assuming for purposes of such calculation, that
the Underlying Securities would have been paid in full on their stated maturity
with no such Unscheduled Payment or acceleration); and third, any remaining
Unscheduled Payment Amount will be divided between the Classes of trust
certificates in accordance with a percentage equal to 6.300/6.325 of such amount
to the Class A Certificateholders and 0.325/6.325 of such amount to the Class B
Certificateholders, and within each class the Unscheduled Payment Amount will be
distributed pro rata to the Certificateholders of the Class A or Class B
Certificates. Such Unscheduled Payment Amount will be distributed to the Class A
and Class B Certificateholders entitled to such Unscheduled Payment Amount upon
the date such Unscheduled Payment Amount is received in immediately available
funds by the Trust if such Unscheduled Payment Amount is received prior to 1:00
pm local time at the office of the Trustee and otherwise on the next Business
Day. Upon distribution of the Unscheduled Payment Amount by the Trustee, the
Trust Certificates called pursuant to the exercise of Call Rights and the Trust
Certificates selected by lot pursuant to this subsection (ii) shall be deemed to
have been surrendered for cancellation by the Trust, and the aggregate stated
21
amount of the outstanding Class A Certificates and the aggregate notional
principal amount of the outstanding Class B Certificates shall be reduced by the
aggregate stated amount of such Class A Certificates and the aggregate notional
principal amount of such Class B Certificates, as applicable; provided that the
right of a Certificateholder to receive the Call Price will not be affected by
any such deemed surrender. Payment of the Unscheduled Payment Amount with
respect to the Certificates will be made to the Call Holder exercising the Call
Rights.
(c) The Call Terms are as follows:
(i) The initial holders of the Call Rights are as named in the
Call Warrants and such holders may transfer the Call Rights, in whole
or in part, to one or more third parties in privately negotiated
transactions;
(ii) A Call Holder that has met the exercise requirements set
forth in paragraph (c)(iii) of this Section 14 may, on the Call Date,
exercise its option to purchase, in whole or in part, a principal or
notional amount of Class A or Class B Certificates, as applicable,
proportionate to such Call Holder's exercised Call Warrants, in
Authorized Denominations of the Class A or Class B Certificates at the
Class A Call Price or Class B Call Price, as applicable;
(iii) In order to exercise its Call Right on a Call Date, a
Call Holder must, not less than 30 days (or not less than three days in
the case of an announcement of any Unscheduled Payment of the
Underlying Securities or after receipt of notice of termination of the
Trust or not less than five Business Days prior to the expiration of a
tender offer for the Underlying Securities) but not more than 60 days
prior to such Call Date:
(1) notify the Trustee in writing of its intention to
exercise such Call Right (which notice is irrevocable, subject
to Section 2.02(i)(v) of the Warrant Agreement) and whether
such exercise is in connection with a tender offer for the
Underlying Securities. In the event that such notice is
provided in connection with a tender offer for the Underlying
Securities, if the exercising Holder did not receive from the
Warrant Agent notice of a Tender Offer, then such Holder shall
also provide the Warrant Agent with any information the Holder
may have from a third-party source indicating that such Tender
Offer is pending.
(2) deposit the applicable Call Price with the Escrow
Agent (the "Escrow Deposit") to be held in escrow pursuant to
an Escrow Agreement reasonably satisfactory to the Trustee and
substantially in the form attached hereto as Exhibit E (to be
entered into immediately preceding delivery of the applicable
Call Price by such Call Holder to the Escrow Agent) until such
Call Price is paid by the Trustee to the Certificateholders in
accordance with paragraph (d) of this Section 14 or returned
to the exercising Holders pursuant to subsection (i) of
Section 2.02 of the Warrant Agreement; provided, that if (a)
all of the outstanding Trust Certificates of a given Class are
to be purchased pursuant to the exercise of the Warrants on an
Exercise Date and the exercising Call Holder at such time
holds Class A Certificates or Class B Certificates that are
subject to Call Rights,
22
the Call Holder may deposit such Class A Certificates or Class
B Certificates with the Escrow Agent in lieu of the portion of
the Call Price that would relate thereto, and (b) if less than
all of the outstanding Class B Trust Certificates are to be
purchased pursuant to the exercise of the Warrants on an
Exercise Date and the exercising Call Holder at such time
holds Class B Certificates that are subject to Call Rights,
the Call Holder may deposit such Class B Certificates with the
Escrow Agent in lieu of the portion of the Call Price that
would relate thereto.
(3) provide the Trustee with any other documents
customary for a transaction of this nature, including a
certificate of the Call Holder certifying the solvency of such
Call Holder on such date; provided that the Call Holder need
not provide any such solvency certificate if the rating of the
senior, unsecured long-term debt of the Call Holder, or the
Call Holder's credit support provider, if applicable, by
Moody's and S&P is in one of the investment grade categories
of Xxxxx'x and S&P, respectively, on such date.
The provisions of this Section 14(c)(iii)(1) through (3) shall not apply if
Warrants are being exercised upon an acceleration of the maturity of the
Underlying Securities and payment in full by the Underlying Securities Issuer of
all amounts due upon such acceleration.
(d) In connection with any exercise of the Call Rights to
purchase Class A Certificates, the Trustee shall select by lot (or by such other
reasonable procedure as may be established by the Trustee) a stated amount of
the outstanding Class A Certificates to be surrendered by the Class A
Certificateholders thereof to the Trustee upon any such exercise (other than
Class A Trust Certificates held by any Person to whom a Delivery Certificate was
delivered in accordance with Section 2.02(d) of the Warrant Agreement, as
evidenced by the registration of such Delivery Certificate in the Delivery
Register in accordance with Section 4.01 of the Warrant Agreement), deliver such
Class A Certificates to the exercising Call Holder and the proceeds of the Class
A Call Price shall be distributed pro rata among such Class A Certificateholders
on the Call Date in accordance with the provisions of the Warrant Agreement. In
connection with any exercise of the Call Rights to purchase Class B
Certificates, if the amount to be purchased exceeds the amount of Trust
Certificates of such Class held by the Call Holder and deposited with the Escrow
Agent, the Trustee shall select by lot (or by such other reasonable procedure as
may be established by the Trustee) an aggregate notional principal amount of the
outstanding Class B Certificates to be surrendered by the Class B
Certificateholders thereof to the Trustee upon any such exercise (other than
Class B Trust Certificates held by any Persons to whom a Delivery Certificate
was delivered in accordance with Section 2.02(d) of the Warrant Agreement, as
evidenced by the registration of such Delivery Certificate in the Delivery
Register in accordance with Section 4.01 of the Warrant Agreement), deliver such
Class B Certificates to the exercising Call Holder and the proceeds of the Class
B Call Price shall be distributed pro rata among such Certificateholders on the
Call Date in accordance with the provisions of the Warrant Agreement. Upon
distribution of the applicable Call Price, the Trust Certificates called
pursuant to the exercise of Call Rights shall be deemed to have been surrendered
and such Trust Certificates shall be transferred to the Call Holder; provided
that the right of a Certificateholder to receive the Call Price will not be
affected by any such deemed surrender.
23
(e) The rights of the Certificateholders under the Trust
Agreement and the Certificates are limited by the terms, provisions and
conditions of the Trust Agreement and the Warrant Agreement with respect to the
exercise of the applicable Call Rights by the Call Holder. The
Certificateholders, by their acceptance of Certificates, covenant and agree to
tender any and all Certificates to the Warrant Agent upon the Call Holder's
exercise of Call Rights and deposit of the applicable Call Price with the Escrow
Agent for such Certificates in accordance with the applicable procedures in the
Warrant Agreement.
(f) Upon receipt of a notice of a tender offer for the
Underlying Securities, the Trustee shall deliver notice of the tender offer to
the Warrant Agent and holders of Delivery Certificates (as defined in Section
2.02(d) of the Warrant Agreement) within two Business Days after receipt of
notice from the Tender Offeror (as defined in the Warrant Agreement). Within two
Business Days of the expiration of the period for validly delivering tender
offer exercise notices pursuant to Section 2.02(i)(i) of the Warrant Agreement,
the Trustee shall, after giving effect to the exercise of Call Rights with
respect to Trust Certificates already held by the Call Holder, as set forth in
the Warrant Agreement, (A) select by lot (or by such other reasonable procedure
as may be established by the Trustee), in the case of Class A Certificates, a
stated amount of Class A Certificates equal to the aggregate stated amount of
Class A Certificates not subject to Delivery Certificates then outstanding
multiplied by the aggregate principal amount of Class A Call Rights being
exercised divided by the aggregate principal amount of the outstanding Class A
Call Rights and, in the case of Class B Certificates an aggregate notional
principal amount of Class B Certificates equal to the aggregate notional
principal amount of Class B Certificates not subject to Delivery Certificates
then outstanding multiplied by the aggregate notional principal amount of Class
B Call Rights being exercised divided by the aggregate notional principal amount
of the outstanding Class B Call Rights and (B) notify the Certificateholders of
the selected Certificates that, subject to Section 2.02(i) of the Warrant
Agreement, such Certificates will be purchased on the Call Date. Upon the
Trustee's receipt of the tender offer proceeds, the applicable Call Price will
be distributed pursuant to Section 2.02(e) and Section 2.02(i)(vi) of the
Warrant Agreement pro rata to the Certificateholders whose Certificates have
been purchased and the tender offer proceeds will be distributed by the Trustee
pro rata to the exercising Call Holders pursuant to Section 2.02(i) of the
Warrant Agreement. Upon distribution of the applicable Call Price and tender
offer proceeds, the Trust Certificates called pursuant to the exercise of Call
Rights shall be deemed to have been surrendered for cancellation by the Trustee
and the aggregate stated amount of the outstanding Trust Certificates shall be
reduced by the aggregate stated amount of such Trust Certificates; provided that
the right of a Certificateholder to receive the Call Price will not be affected
by any such deemed surrender.
Section 16. Amendments. Notwithstanding anything in the Trust
Agreement to the contrary, in addition to the other restrictions on modification
and amendment contained herein, the Trustee shall not enter into any amendment
or modification of the Trust Agreement that would adversely affect in any
material respect the interests of the Certificateholders or the Call Holders
without the consent of 100% of such Certificateholders or Call Holders, as the
case may be; provided, however, that no such amendment or modification will be
permitted if the Trustee has been advised by the Depositor that such amendment
or modification would alter the status of the Trust as a "grantor trust" for
federal income tax purposes. Further, no amendment shall be permitted pursuant
to paragraphs (vi), (vii) and (x) of Section 11.01(a) of the Standard
24
Terms without prior written confirmation by each Rating Agency that such
amendment will not result in a downgrading or withdrawal of its rating of the
Certificates. The Trustee may consult with counsel and shall be entitled to rely
upon an Opinion of Counsel for purposes of determining compliance with the
provisions of this Section 15.
Section 17. Voting of Underlying Securities, Modification of
Indenture. 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 trustee or the Underlying Securities Issuer for its
consent to any amendment, modification or waiver of the Underlying Securities,
the Underlying Securities Indenture 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 (based on the
relative outstanding principal balances of the Certificates) as the Certificates
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 after weighing the votes of the Class A Certificateholders
and the Class B Certificateholders in accordance with the Allocation Ratio;
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) alter the
status of the Trust as a "grantor trust" for federal income tax purposes or
result in the imposition of tax upon the Certificateholders, or (ii) that 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 that with the passage of time would become an event of default under
the Underlying Securities and with the consent of 100% of the Certificateholders
and 100% of the Call Holders, or (iii) except as provided in the following
paragraph, that 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 Indenture and only with the consent of 100% of the
Certificateholders and 100% of the Call Holders. The Trustee shall have no
liability for any failure to act resulting from Certificateholders' or Call
Holders' late return of, or failure to return, directions requested by the
Trustee from the Certificateholders and Call Holders.
If 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 Certificateholders, the Call Holders
and the Rating Agencies of such offer promptly. Subject to Sections 7(b) and 14
in connection with a tender offer and the exercise of Call Rights or Optional
Exchange rights, the Trustee must reject any such offer unless the Trustee is
directed by the affirmative vote of 100% of the Certificateholders and 100% of
the Call Holders to accept such offer, the Trustee has received the tax opinion
described above and if the Trustee is so directed, the Trustee shall promptly
25
notify the Rating Agencies of such direction accompanied by evidence of the
affirmative vote of such Certificateholders and Call Holders.
If an event of default under the Underlying Securities
Indenture occurs and is continuing, and if directed by 100% of the
Certificateholders, the Trustee shall vote the Underlying Securities in favor of
directing, or take such other action as may be appropriate to direct, the
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 18. Call Right Documentation. Simultaneously with the
execution hereof, the Depositor hereby directs the Trustee, in the name of and
on behalf of the Trust, to enter into a Warrant Agreement and any related
Warrant Certificates (as defined in the Warrant Agreement) evidencing the Call
Rights and to make representations contained therein on behalf of the Trust. At
the direction of the Depositor, the Trustee shall execute such further documents
as may be required to evidence any transfer of any or all of the rights,
interests or obligations under the Warrant Agreement and any related Warrant
Certificates.
Section 19. Third Party Beneficiary. The Escrow Agent and each
Call Holder shall be third party beneficiaries of this Trust Agreement.
Section 20. Nonpetition Covenant. Solely with respect to the
Trust and the Series and for no other purpose, Section 11.07 of the Standard
Terms is hereby deleted and replaced with the following:
"Section 11.07. Nonpetition Covenant. Notwithstanding any
prior termination of this Trust Agreement, each of the Trustee (including any
Administrative Agent, Authenticating Agent and Paying Agent) and the Depositor
agrees that it shall not, until the date which is one year and one day after the
termination of the PPLUS Trust Series RRD-1, acquiesce, petition or otherwise
invoke or cause the Trust to invoke the process of the United States, 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 under a Federal or state bankruptcy, insolvency or similar law or
appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or
other similar official of such Trust or all or any part of the property or
assets of such Trust or ordering the winding up or liquidation of the affairs of
such Trust."
Section 21. Amendments to Standard Terms. Solely with respect
to the Trust and the Series and for no other purpose, the Standard Terms are
hereby amended as follows:
(a) Clause (iii) of Subsection (c) of Section 2.01 of the
Standard Terms shall be deleted and replaced with the following:
"at the time of delivery of the Underlying Securities,
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 (other than the lien created by this Trust Agreement); and"
26
(b) Subsection (e) of Section 2.01 of the Standard Terms shall
be deleted and replaced with the following:
"Any Trust created hereunder shall not engage in any business
or activities other than in connection with, or relating to, the
holding, protecting and preserving of the Deposited Assets and the
issuance of the Certificates and, if applicable, Call Rights, and other
than those required or authorized by this Trust Agreement or incidental
to and necessary to accomplish such activities. Any Trust created
hereunder shall not issue or sell any certificates or other obligations
other than the Certificates or, if applicable, Call Rights or otherwise
incur, assume or guarantee any indebtedness for money borrowed."
(c) Clause (v) of Subsection (b) of Section 4.08 of the
Standard Terms shall be deleted and replaced with the following:
"that Holders of Certificates receiving notice of Call Rights
being exercised with respect to the Certificates held by them shall not
be entitled to any interest on the Certificates for any period on and
after the Call Date, and the only remaining right of Holders of such
Certificates is to receive payment of the Call Price upon surrender of
the Certificates to the Warrant Agent; and"
(d) The first sentence of subsection (d) of Section 4.08 of
the Standard Terms shall be deleted and replaced with the following:
"Once such notice is mailed to a Holder, such Holder shall not
be entitled to any right as a Holder other than the right to receive
payment of the Call Price on the Call Date and the Certificates subject
to the Call Right shall be deemed to have been automatically
surrendered to the Trust for further transfer to the holder exercising
its Call Right."
(e) Subsection (e) of Section 4.08 of the Standard Terms shall
be deleted and replaced with the following:
"Subject to Section 2.02(a)(i) of the Warrant Agreement, at or
prior to 12:00 noon on the Call Date, the holder of the Call Right to
be exercised shall deposit with the Escrow Agent by wire transfer in
same-day funds money sufficient to pay the Call Price of the
Certificates to be purchased on that date."
(f) Subsection (f) of Section 4.08 of the Standard Terms shall
be deleted and replaced with the following:
"This subsection has been intentionally left blank."
(g) Subsection (g) of Section 4.08 shall be deleted and
replaced with the following:
"Upon surrender of any Certificate that is purchased in part,
the Depositor shall execute and the Trustee shall authenticate and
deliver to the Holder a new Certificate equal in principal amount to
the portion of such surrendered Certificate not purchased."
27
IN WITNESS WHEREOF, the parties hereto have caused this
Supplement to be duly executed by their respective authorized officers as of the
date first written above.
Xxxxxxx Xxxxx Depositor, Inc.,
as Depositor
By: __________________________________
Name:
Title: President
The Bank of New York,
not in its individual capacity
but as Trustee
By: __________________________________
Name:
Title: Authorized Signatory
The Bank of New York,
as Securities Intermediary
By: __________________________________
Name:
Title: Authorized Signatory
[SERIES SUPPLEMENT SIGNATURE PAGE]
SCHEDULE I
PPLUS TRUST CERTIFICATES, SERIES RRD-1
UNDERLYING SECURITIES SCHEDULE
Underlying Securities: $60,000,000 6 5/8% Debentures due April
15, 2029 of the Underlying Securities
Issuer.
Underlying Securities Issuer: X.X. Xxxxxxxxx Sons & Company, a Delaware
corporation.
Underlying Securities Indenture Indenture dated as of November 1, 1990
between the Underlying Securities Issuer,
and the Underlying Securities Trustee.
Underlying Securities Trustee: The Bank of New York
Underlying Securities 000000XX0
CUSIP Number:
Underlying Securities April 16, 1999
Original Issue Date:
Underlying Securities $200,000,000 6 5/8% Debentures due April
Original Amount Issued: 15, 2029 (principal amount $1,000 per
security)
Underlying Securities 033-57807
Commission File Number:
Underlying Securities April 15, 2029
Maturity Date:
Underlying Securities April 15, 2029
Principal Payment Date:
Underlying Securities April 15 and October 15, or if any such
Interest Payment Dates: date is not a business day, then the next
succeeding business day to the persons in
whose names the underlying securities are
registered at the close of business on the
15th day preceding the relevant interest
payment date, subject to certain
exceptions.
Underlying Securities 6.325% per annum.
Interest Rate:
Underlying Securities April 1 and October 1.
Record Dates:
Underlying Securities The Underlying Securities Issuer will have
Redemption: the option to redeem the Underlying
Securities as a whole or in part, at its
option at any time and from time to time
at a redemption price equal to the greater
of (i) 100% of the principal amount of the
Underlying Securities to be redeemed and
(ii) as determined by the quotation agent
described below, the sum of the present
value of the remaining scheduled payments
of principal and interest with respect to
the Underlying Securities to be redeemed
(not including any portion of such
payments of interest accrued as of the
date of redemption) discounted to the date
of redemption on a semi-annual basis
(assuming a 360-day year consisting of
twelve 30-day months) at the adjusted
treasury rate described below plus 25
basis points, plus, in each case, accrued
interest to the date of redemption.
Holders of the Underlying Securities to be
redeemed will receive at least 30 days but
not more than 60 days notice of that
redemption.
Underlying Securities None.
Collateral:
Underlying Securities None.
Amortization:
Underlying Securities Semi-annual.
Accrual Periods:
Underlying Securities The Underlying Securities are denominated
Authorized Denomination and payable in U.S. dollars and are
and Specified Currency: available in minimum denominations of
$1,000 and integral multiples thereof.
Underlying Securities "A-" by Standard & Poor's Ratings
Rating as of Closing: Services, a division of The McGraw Hill
Companies, Inc. and "Baa2" by Xxxxx'x
Investors Service, Inc.
Underlying Securities Form: Book-entry security with DTC.
EXHIBIT A
Standard Terms for Trust Agreements
EXHIBIT B
Form of Class A Certificate
EXHIBIT C
Form of Class B Certificate
(begins on next page)
FORM OF TRUST CERTIFICATE
No. B- CUSIP NO. _________
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 THE 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.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR THE INDIVIDUAL
CERTIFICATES REPRESENTED HEREBY, THIS CERTIFICATE MAY NOT BE TRANSFERRED EXCEPT
AS A WHOLE BY DTC TO CEDE & CO. OR BY CEDE & CO. TO DTC OR TO ANOTHER NOMINEE OF
DTC OR BY DTC OR CEDE & CO. TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITORY.
THIS CERTIFICATE REPRESENTS A FRACTIONAL 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 DEPOSITED ASSETS ARE INSURED OR GUARANTEED BY ANY
GOVERNMENTAL AGENCY OR ANY OTHER PERSON.
THE HOLDER OF THIS CERTIFICATE SHALL HAVE NO DIRECT RIGHT TO PRINCIPAL OR
INTEREST PAYMENTS IN RESPECT OF THE UNDERLYING SECURITIES. THE REGISTERED HOLDER
HEREOF, BY ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL LOOK SOLELY TO THE ASSETS
DEPOSITED IN THE TRUST, TO THE EXTENT OF ITS RIGHTS THEREIN, FOR DISTRIBUTIONS
HEREUNDER.
PPLUS TRUST SERIES RRD-1
_________ PPLUS CLASS B 0.325% CALLABLE TRUST CERTIFICATES SERIES RRD-1
($25 NOTIONAL PRINCIPAL AMOUNT PER TRUST CERTIFICATE)
evidencing a fractional undivided beneficial ownership interest in the Trust, as
defined below, the property of which consists principally of $60,000,000
aggregate principal amount of 6 5/8% Debentures due 2029(the "Underlying
Securities") issued by X.X. Xxxxxxxxx & Sons Company, a Delaware corporation,
and all payments received thereon, deposited in trust by Xxxxxxx Xxxxx
Depositor, Inc. (the "Depositor").
THIS CERTIFIES THAT CEDE & CO. is the registered owner of a
nonassessable, fully-paid, fractional undivided interest in the PPLUS Trust
Series RRD-1 formed by the Depositor. Under the Trust Agreement, the Class B
Certificateholders are entitled to receive on each Distribution Date until April
15, 2029, the distributions, if any, received on the Underlying Securities,
which will represent distributions at a rate of 0.325% per annum on the
principal amount of the Underlying Securities.
The Trust was created pursuant to a Standard Terms for Trust
Agreements, dated as of November 5, 2004 (the "Standard Terms"), among the
Depositor, The Bank of New York, a New York corporation, as Trustee (the
"Trustee") and The Bank of New York as securities intermediary (the "Securities
Intermediary"), as supplemented by the PPLUS Series RRD-1 Supplement, dated as
of March 2, 2006 (the "Series Supplement" and, together with the Standard Terms,
the "Trust Agreement"), between the Depositor and the Trustee and the Securities
Intermediary. 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 PPLUS Class B 0.325% Callable Trust Certificates Series RRD-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. Further, subject to the terms,
provisions and conditions of the Trust Agreement, the Trust will issue Call
Rights, which will be sold in one or more privately negotiated transactions. The
rights of the Certificateholders under the Trust Agreement and this Certificate
are limited by the terms, provisions and conditions of the Trust Agreement and
the Warrant Agreement with respect to the exercise of Call Rights by the holders
of Call Rights. The Certificateholders, by their acceptance of the Certificates,
covenant and agree to tender any and all Certificates to the Warrant Agent upon
the holder's exercise of Call Rights and deposit of the Call Price with the
Escrow Agent for such Certificates in accordance with the applicable procedures
in the Warrant Agreement. The property of the Trust consists of the Underlying
Securities, all payments received or receivable
on the Underlying Securities accrued on or after the Cut-off Date, and the other
Deposited Assets, if any, all as more fully specified in the Trust Agreement.
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 fractional undivided 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.
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 check mailed to the
Certificateholder of record in the Certificate Register or by wire transfer to
an account designated by such Holder without the presentation or surrender of
this Certificate or the making of any notation hereon of, 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.
The Trustee does not assume responsibility for the accuracy of
the statements in the Certificate (and the reverse hereof).
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee, 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 AND
GOVERNED BY THE LAW OF THE STATE OF NEW YORK.
[TRUST CERTIFICATE - CLASS B SIGNATURE PAGE]
IN WITNESS WHEREOF, the Trustee has caused this Class B
Certificate to be duly executed as of the date set forth below.
PPLUS TRUST SERIES RRD-1
By: THE BANK OF NEW YORK,
solely in its capacity as Trustee under
the Trust Agreement and not in its
individual capacity
Dated: By: _________________________
Authorized Signatory
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates described in the Trust
Agreement referred to herein.
PPLUS TRUST SERIES RRD-1
By: THE BANK OF NEW YORK,
solely in its capacity as Trustee under
the Trust Agreement and not in its
individual capacity
Dated: By: _________________________
Authorized Signatory
[TRUST CERTIFICATE - CLASS B SIGNATURE PAGE]
(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
Deposited Assets (to the extent of its rights therein) for interest
distributions hereunder. Both the Underlying Securities and Call Holders that
exercise their Call Rights may be sources of principal distributions on the
Certificates. The rights of the Certificateholders under the Trust Agreement and
this Certificate are limited by the terms, provisions and conditions of the
Trust Agreement and the Warrant Agreement with respect to the exercise of Call
Rights by the holders of Call Rights. The Certificateholders, by their
acceptance of the Certificates, covenant and agree to tender any and all
Certificates to the Warrant Agent upon the holder's exercise of Call Rights and
deposit of the Call Price with the Escrow Agent for such Certificates in
accordance with the applicable procedures in the Warrant Agreement.
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 Certificates evidencing greater
than 66 2/3% of the aggregate Voting Rights of the Certificates subject to
certain provisions set forth in the Trust Agreement. 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.
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 signed by, the Holder hereof, 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 The Bank of New York.
No service charge will be made for any registration of
transfer or exchange, but the Trustee may require payment 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, the Trustee and the Securities Intermediary and
any agent of the Depositor, the Trustee or the Securities Intermediary may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and neither the Depositor, the Trustee, or the Securities
Intermediary 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
United States federal income tax purposes under Treasury Regulation Section
301.7701-4, and the Certificateholder, by its acceptance of this Certificate,
agrees to treat the Certificates, the distributions from the Trust and its
beneficial interest in the Trust consistently with such characterization.
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 Deposited Assets and the issuance of the Certificates and the Call
Rights, 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 Rights or otherwise incur, assume or guarantee any indebtedness for
money borrowed.
The Trust and the obligations of the Depositor, the Trustee
and the Securities Intermediary created by the Trust Agreement with respect to
the Certificates shall terminate upon the earlier 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 in respect of the Certificates and (ii) April 15, 2029.
If an employee benefit plan subject to the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), including an individual
retirement account or Xxxxx plan (each, a "Plan"), purchases Certificates,
certain aspects of such investment, including the operation of the Trust, might
be subject to the prohibited transaction provisions under ERISA and the Internal
Revenue Code of 1986, as amended (the "Code"), unless certain exemptions apply.
A Plan should consult its advisors concerning the ability of such Plan to
purchase Certificates under ERISA or the Code.
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
________________________________________________________________________________
(PLEASE INSERT SOCIAL SECURITY OR TAXPAYER IDENTIFICATION 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 Registrar, with full
power of substitution in the premises.
Dated:
Signature : __________________________________________*
Signature Guarantee: ______________________________________*
* 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. Such signature must be
guaranteed by a brokerage firm or financial institution that is a member of a
Securities Approved Medallion Program such as Securities Transfer Agents
Medallion Program (STAMP), Stock Exchange Medallion Program (SEMP) or New York
Stock Exchange Inc. Medallion Signature Program (MSP).
OPTION TO ELECT EXCHANGE
If you wish to have this Certificate, or a portion thereof,
exchanged by the Trustee pursuant to Section 4.07 of the Standard Terms, check
the Box: [_]
If you wish to have less than all of this Certificate
exchanged, state the amount:
$___________________.
Date:
Your Signature : ______________________________________
(Sign exactly as your name appears
on the other side of this Certificate)
Signature Guarantee: ______________________________________
EXHIBIT D
Form of Market Agent Agreement
(begins on next page)
FORM OF MARKET AGENT AGREEMENT
MARKET AGENT AGREEMENT, dated as of __________ (the
"Agreement"), by and between Xxxxxxx Xxxxx & Co. ("Xxxxxxx Xxxxx & Co.") and the
PPLUS Trust Series RRD-1 (the "Trust"), a New York trust created under the
Standard Terms for Trust Agreements, dated as of November 5, 2004 (the "Standard
Terms"), between Xxxxxxx Xxxxx Depositor, Inc., as depositor (the "Depositor")
and The Bank of New York, as trustee (the "Trustee") and as securities
intermediary (the "Securities Intermediary"), as amended and supplemented by the
Series Supplement, dated as of the date hereof, between the Depositor and the
Trustee and Securities Intermediary (the Standard Terms, together with the
Series Supplement, the "Trust Agreement"). Capitalized terms used but not
defined herein shall have the meanings ascribed to them in the Trust Agreement.
This Agreement shall constitute the "Market Agent Agreement" as defined in the
Trust Agreement.
W I T N E S S E T H:
WHEREAS, the Trust desires to retain Xxxxxxx Xxxxx & Co. to
render certain services to the Trust in the manner and on the terms hereinafter
set forth;
WHEREAS, Xxxxxxx Xxxxx & Co. is a recognized broker dealer
meeting the qualifications for a Market Agent set forth in the Trust Agreement
and desires to provide such services to the Trust on the terms and conditions
hereinafter set forth; and
WHEREAS, the Trustee has been directed to enter into and
execute this Market Agent Agreement with Xxxxxxx Xxxxx & Co. as the initial
Market Agent pursuant to Section 8.01 of the Standard Terms;
NOW, THEREFORE, in consideration of the premises and the
covenants hereinafter contained, Xxxxxxx Xxxxx & Co. and the Trust hereby agree
as follows:
Section 1. Duties of the Market Agent. The Trust hereby
employs Xxxxxxx Xxxxx & Co. to act as the Market Agent for the Trust and to
furnish to the Trust all of the services of the Market Agent set forth herein
and in the Trust Agreement, including but not limited to acting on behalf of the
Trust in connection with the sale and purchase of Underlying Securities as
provided in the Trust Agreement. The Market Agent may solicit and accept bids
from Certificateholders for the Underlying Securities. Xxxxxxx Xxxxx & Co.
hereby accepts such employment and agrees during the term of the Certificates to
render such services and to assume the obligations of the Market Agent under the
Trust Agreement under the terms and conditions herein set forth.
Section 2. Compensation of Xxxxxxx Xxxxx & Co. The Depositor
shall pay Xxxxxxx Xxxxx & Co. a fee as shall be separately agreed between the
Depositor and Xxxxxxx Xxxxx & Co. It shall be the sole responsibility of the
Depositor to pay such fee and the Trust shall have no obligation to compensate
Xxxxxxx Xxxxx & Co. for the services it renders pursuant to the terms of this
Market Agent Agreement, except that the Trust shall pay Xxxxxxx Xxxxx & Co. a
fee for any
sale of the Underlying Securities in an amount that is customary for
such a sale at the time of such sale.
Section 3. Limitation of Liability of the Market Agent. The
Market Agent shall not be liable in contract, tort or otherwise to the Trust for
any losses, costs or damages arising out of its performance of its obligations
and duties hereunder except for willful misconduct or negligence in the
performance of its duties, or by reason of reckless disregard of its obligations
and duties hereunder.
Section 4. Term of this Agreement. This Agreement, which shall
be a binding agreement as of the date hereof and shall inure to the benefit of
the respective successors and permitted assigns of the parties hereto, shall
terminate upon the earlier to occur of (a) the termination of the Trust
Agreement, (b) the removal of the Market Agent by the Trustee in accordance with
the Trust Agreement or (c) 30 days after written notice of Xxxxxxx Xxxxx & Co.'s
resignation as Market Agent is delivered to the Trustee.
Section 5. Amendments. No amendment or waiver of any provision
of this Agreement nor consent to any departure herefrom by any party hereto
shall in any event be effective unless the same shall be in writing and signed
by the party against which enforcement of such amendment or waiver or consent is
sought, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which it is given.
Section 6. Notice Addresses. Except as otherwise expressly
provided herein, all notices and other communications provided for hereunder
shall be deemed to have been duly given if sent by facsimile transmission (a) if
to the Market Agent, as set forth below and (b) if to the Trustee, as set forth
in the Trust Agreement;
If to Xxxxxxx Xxxxx & Co.: Xxxxxxx Xxxxx & Co.
4 World Financial Center
North Tower, 7th Floor
New York, NY 10080
Attention: Xxxxxxx X. Xxxxxx
Xxxxxxxxx: (000) 000-0000
Telephone confirmation: (000) 000-0000
Section 7. Assignment. Except as provided in this Section 7,
this Agreement may not be assigned by the Market Agent without the prior consent
of the Trustee in accordance with the Trust Agreement.
The Market Agent shall have the right to transfer and assign
all of its rights, duties, obligations and liabilities under this Agreement to
an Affiliate of the Market Agent; provided, however, that such transfer and
assignment shall be on the condition that the due and punctual performance and
observance of all the terms and conditions of this Agreement to be performed by
the Market Agent shall, by an agreement supplemental hereto, be assumed by such
Affiliate just as fully and effectually as if such Affiliate had been the
original party of the first part to this Agreement.
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Section 8. Applicable Law. This Agreement shall be governed by
the laws of the State of New York.
Section 9. Entire Agreement. This Agreement embodies the
entire agreement and understanding between Xxxxxxx Xxxxx & Co. and the Trust and
supersedes any and all prior agreements and understandings between Xxxxxxx Xxxxx
& Co. and the Trust relating to the subject matter hereof.
Section 10. Counterparts. This Agreement may be signed in any
number of counterparts, each of which shall be an original, with the same effect
as if the signatures thereto and hereto were upon the same instrument.
Section 11. Severability of Provisions. If one or more of the
provisions of this Agreement shall be for any reason whatsoever held invalid or
unenforceable, such provisions shall be deemed severable from the remaining
covenants, agreements and provisions of this Agreement and such invalidity or
unenforceability shall in no way affect the validity or enforceability of such
remaining provisions or the rights of any parties thereunder. To the extent
permitted by law, the parties hereto hereby waive any provision of law that
renders any provision of this Agreement invalid or unenforceable in any respect.
Section 12. Nonpetition Covenant. Notwithstanding any prior
termination of this Agreement, Xxxxxxx Xxxxx & Co. agrees that it shall not,
until the date which is one year and one day after the termination of the PPLUS
Trust Series RRD-1 pursuant to the terms of Section 13 of the Series Supplement,
acquiesce, petition or otherwise invoke or cause the Trust to invoke the process
of the United States, 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 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 or all
or any part of the property or assets of the Trust or ordering the winding up or
liquidation of the affairs of the Trust.
Section 13. No Recourse. Xxxxxxx Xxxxx & Co. shall have no
recourse to the Underlying Securities with respect to any fees owed to Xxxxxxx
Xxxxx & Co. under Section 2 of this agreement. This Section 13 shall not be read
as limiting any right Xxxxxxx Xxxxx & Co. may have to the Underlying Securities
pursuant to any security, call right or other instrument, obligation or
agreement the Trust may issue or enter into from time to time.
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IN WITNESS WHEREOF, the parties hereto have executed and
delivered this Market Agent Agreement as of the day and year first above
written.
XXXXXXX XXXXX & CO.
By:______________________________________
Name:
Title: Authorized Signatory
PPLUS TRUST SERIES RRD-1
By: THE BANK OF NEW YORK, solely in its
capacity as Trustee under the Trust Agreement
and not in its individual capacity
By:______________________________________
Name:
Title: Authorized Signatory
[MARKET AGREEMENT SIGNATURE PAGE]
EXHIBIT E
Form of Escrow Agreement
(begins on next page)
FORM OF
ESCROW DEPOSIT AGREEMENT
THIS ESCROW DEPOSIT AGREEMENT, dated as of this __ day of_____
among PPLUS Trust Series RRD-1 (the "Trust"), by The Bank of New York, a New
York corporation, as Trustee of the Trust ("Trustee"), [ ], a [ ] corporation,
as Escrow Agent ("Escrow Agent"), and [ ], a [ ] corporation ("Holder").
W I T N E S S E T H:
WHEREAS, the Trustee and Xxxxxxx Xxxxx Depositor, Inc. (
"Depositor") entered into a Standard Terms for Trust Agreement dated November 5,
2004 (the "Standard Terms"), as supplemented by a Series Supplement dated March
2, 2006 (the "Series Supplement," and, together with the Standard Terms, the
"Trust Agreement"), providing for the issuance by the Trust of PPLUS Class A
6.30% Callable Trust Certificates Series RRD-1 and PPLUS Class B 0.325% Callable
Trust Certificates Series RRD-1 (collectively, the "Trust Certificates") and
delivery of related call warrants on the Trust Certificates (each a "Warrant,"
and collectively, the "Warrants") as described in the Warrant Agreement dated
March 2, 2006 (the "Warrant Agreement") among the Trust and The Bank of New
York, as Warrant Agent (the "Warrant Agent"); and
WHEREAS, the Holder is [one of the holders] [the holder] of
the Warrants; and
WHEREAS, it is a condition precedent to the exercise of the
Warrants that the Holder enter into this Agreement and deliver the Escrow
Deposit (as defined herein) to the Escrow Agent not less than 30 days (or not
less than three days in the case of the announcement of any redemption or other
unscheduled payment of the Underlying Securities or receipt of notice of
termination of the Trust or when a tender offer for the Underlying Securities is
pending not less than five days prior to the expiration of the tender offer
acceptance period) but not more than 60 days prior to the Exercise Date (as
defined in the Warrant Agreement); and
WHEREAS, the parties desire that Escrow Agent shall hold, and
Escrow Agent has agreed to hold, the Escrow Deposit in escrow on the terms and
conditions provided in this Agreement.
NOW THEREFORE, the parties hereto mutually agree as follows:
1. Escrow Deposit. Concurrently with the execution and
delivery of this Agreement, the Holder will deliver [the sum of
____________________ Dollars ($_____________) in lawful money of the United
States of America by wire transfer of immediately available funds] [and] [[ ]
Class A Trust Certificates] [and] [[ ] Class B Trust Certificates] in accordance
with Section 14 of the Series Supplement] (the "Escrow Deposit"), to Escrow
Agent to be held by Escrow Agent in escrow on the terms and conditions
hereinafter provided. Escrow Agent hereby acknowledges receipt of the Escrow
Deposit. Any cash amounts in the Escrow Deposit may be increased or decreased in
accordance with the terms of Section 2.02(i)(vi) of the Warrant Agreement and
the terms of this agreement
will apply with equal force and effect to any such increased or decreased cash
amounts in the Escrow Deposit.
2. Investment of Escrow Deposit. Following the delivery of the
Escrow Deposit to Escrow Agent, Escrow Agent shall cause any cash in the Escrow
Deposit to be deposited in an interest bearing account, designated as the "PPLUS
Trust Series RRD-1 Warrant Escrow Account," and shall advise the Trust by
telephone by 5:00 p.m., New York City time, on the date hereof of the amount so
deposited in its account. The Escrow Agent will promptly confirm such telephone
advice in writing to the Trust. The Escrow Agent is hereby directed to invest
any cash in the Escrow Deposit in (i) U.S. Treasury Securities or (ii) money
market accounts in banks having combined capital, surplus and undivided profits
of $50,000,000 or more. All investments shall [have a maturity of ________ days
or less during the _______ days immediately after deposit of the Escrow Deposit,
and thereafter shall] be available on demand without penalty unless Escrow Agent
is otherwise directed in writing by both the Holder and the Trust.
3. Disposition of Escrow Deposit Prior to and at Closing.
(a) On the Exercise Date, simultaneously with the transfer of
Trust Certificates to the Holder that were subject to the Holder's Warrants
(including any such Trust Certificates deposited as set forth in paragraph 1),
except where the Exercise Date is a deemed Exercise Date pursuant to Section
2.02(i)(iv) of the Warrant Agreement, in which case no such transfer will occur,
(the "Closing," the period of time between the initial deposit of the Escrow
Deposit and the Closing being referred to as the "Escrow Period") in accordance
with the terms of the Warrant Agreement (i) the Escrow Agent shall pay to the
Holder all interest, and interest earned on interest, on any cash in the Escrow
Deposit to the Closing Date in lawful money of the United States of America by
wire transfer of immediately available funds to a bank account or bank accounts
designated by the Holder or, at the Holder's option, by a bank check or bank
checks payable to the order of a payee or payees designated by the Holder, (ii)
the Escrow Agent shall pay any cash amounts in the Escrow Deposit in lawful
money of the United States of America by wire transfer of immediately available
funds to a single bank account or bank accounts designated by the Warrant Agent,
or, at the Warrant Agent's option, by a bank check or bank checks payable to the
order of a payee or payees designated by the Warrant Agent and (iii) the Escrow
Agent shall deliver any Trust Certificates in the Escrow Deposit to the Warrant
Agent.
(b) If, during the Escrow Period, the Trust Agreement is
terminated in accordance with Section 10 of the Standard Terms and Section 13 of
the Series Supplement, then Escrow Agent shall, ten (10) business days after
written notice by Trust and the Holder of such termination, (i) return any Trust
Certificates in the Escrow Deposit to the Holder and (ii) pay to the Holder any
cash in the Escrow Deposit, plus all interest, and interest earned on interest,
on such cash, in lawful money of the United States of America by wire transfer
of immediately available funds to a bank account or bank accounts designated by
the Holder or, at the Holder's option, by a bank check or bank checks payable to
the order of a payee or payees designated by the Holder; provided, however, that
if the Escrow Agent receives a written objection from the Trust to such release
of such cash in the Escrow Deposit within seven (7) business days after the
Holder gives such written notice, then the Escrow Agent shall pay the cash
amount in the
2
Escrow Deposit and any interest, and interest earned on interest, on such
amounts in accordance with joint written instructions from the Holder and the
Trust, or, in the absence of such joint written instructions, the provisions of
Section 6 hereof shall apply.
4. Liability of Escrow Agent. The Escrow Agent shall not incur
any liability to any party for damages, losses or expenses for (a) any act or
failure to act made or omitted in good faith and without gross negligence or
willful misconduct or (b) any action taken or omitted in reliance upon any
instrument that the Escrow Agent shall in good faith believe to be genuine, nor
will the Escrow Agent be liable or responsible for forgeries, fraud,
impersonations, or determining the scope of any representative authority. In
addition, the Escrow Agent may consult with legal counsel in connection with the
Escrow Agent's duties under this Agreement and shall be fully protected in any
act taken, suffered, or permitted by it in good faith in accordance with the
advice of counsel. The Escrow Agent is not responsible for determining and
verifying the authority of any person acting or purporting to act on behalf of
any party to this Agreement.
5. Escrow. The Escrow Agent can incur reasonable expenses in
connection with its duties and incur legal fees and expenses in connection with
this Agreement with any firm, and such expenses shall be paid or reimbursed, as
the case may be, in accordance with Section 7 of this Agreement. In the event
that the conditions of this Agreement are not properly fulfilled, or if the
Escrow Agent renders any service not provided for in this Agreement, or if the
parties request a substantial modification of its terms, or if any controversy
arises, or if the Escrow Agent is made a party to, or intervenes in, any
litigation pertaining to this escrow or its subject matter, the Escrow Agent
shall be reasonably compensated for such extraordinary service and reimbursed
for all reasonable costs, attorneys' fees and expenses of any firm occasioned by
such default, delay, controversy or litigation and the Escrow Agent shall have
the right to retain all documents and/or other things of value at any time held
by Escrow Agent in this escrow until such compensation, fees, costs, and
expenses are paid.
6. Controversies. If any controversy arises relating to this
Agreement, or with any other party concerning the subject matter of this
Agreement, its terms or conditions, the Escrow Agent will not be required to
determine the controversy or to take any action regarding it. The Escrow Agent
may hold the Escrow Funds (as hereinafter defined) and may wait for settlement
of any such controversy by final appropriate legal proceedings or other means,
as, in the Escrow Agent's discretion, the Escrow Agent may deem appropriate
despite what may be set forth elsewhere in this Agreement. In such event, the
Escrow Agent will not be liable for damages as long as the Escrow Agent acts in
good faith and without gross negligence or willful misconduct. The Escrow Agent
is authorized to deposit with the clerk of any court the Escrow Funds held
hereunder. Upon initiating an interpleader or declaratory judgment or any other
action seeking to determine the rights of the parties hereunder and depositing
the Escrow Funds, the Escrow Agent shall be fully released and discharged of and
from all further obligations and liability imposed by the terms of this
Agreement, but not as to acts of the Escrow Agent prior thereto. As used herein,
the term "Escrow Funds" means the Escrow Deposit plus all interest, and interest
earned on interest, on the Escrow Deposit.
7. Indemnification of Escrow Agent. The Holder and its
successors and assigns agrees to indemnify and hold Xxxxxx Agent harmless
against any and all losses, claims,
3
damages, liabilities and expenses, including reasonable costs of investigation
and reasonable counsel fees and disbursements, that may be imposed on the Escrow
Agent or incurred by the Escrow Agent in good faith and without gross negligence
or willful misconduct in connection with the performance of the duties under
this Agreement, including, but not limited to, any litigation arising from this
Agreement or involving its subject matter.
8. Termination. Except for the provisions of Section 7, which
shall survive this Agreement, this Agreement shall terminate upon the day on
which all of the Escrow Funds are disbursed in full in accordance with this
Agreement.
9. Mailing Instructions, Etc. Instructions and other documents
delivered under this Agreement shall be valid if (i) hand-delivered, (ii) sent
by registered or certified mail, return receipt requested, (iii) sent by Federal
Express or other reliable overnight courier service, or (iv) transmitted by
telecopy.
(a) If to the Holder at:
___________________________________
___________________________________
___________________________________
Attn:
Telecopy ( )
Telephone ( )
(b) If to the Trust, at:
PPLUS Trust Series RRD-1
c/o The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 0X
Xxx Xxxx, XX 00000
Attn: Corporate Trust Dealing & Trading Group
PPLUS Trust Series RRD-1
Facsimile (000) 000-0000
Telephone (000) 000-0000
(c) If to the Escrow Agent, at:
___________________________________
___________________________________
___________________________________
Attn:
Telecopy ( )
Telephone ( )
Each notice, demand, instruction or communication which shall be given or made
in the manner described above shall be deemed sufficiently given or made at such
time as it is delivered to the addressee in the case of personal delivery or
registered or certified mail, one (1) business day following delivery to the
courier if sent by Federal Express or other reliable overnight courier or
4
upon receipt of the telecopy if sent by telecopy, followed by a written
confirmation within two (2) business days.
10. Trust Agreement; Defined Terms. Defined terms used herein
shall have the respective meanings set forth in the Trust Agreement unless
otherwise defined herein.
11. Binding. This Agreement shall be binding upon, inure to
the benefit of, and be enforceable by the parties hereto and their respective
successors and assigns.
12. Governing Law. This Agreement shall be deemed a contract
made under the laws of the State of New York, and together with the rights and
obligations of the parties hereunder, shall be construed and enforced in
accordance with and governed by the laws of such state (but not including the
choice-of-law rules thereof).
13. Counterparts. This Agreement may be executed
simultaneously in counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument.
14. Captions. Any captions are solely for convenience of
reference and shall not be used in construing or interpreting this Agreement.
15. Entire Agreement. This Agreement sets forth the entire
agreement among the parties with respect to the subject matter hereof and
supersedes all prior or oral agreements or understandings with respect thereto.
16. Nonpetition Covenant. Notwithstanding any prior
termination of this Agreement, the Escrow Agent agrees that it shall not, until
the date which is one year and one day after the termination of the PPLUS Trust
Series RRD-1 pursuant to the terms of Section 13 of the Series Supplement,
acquiesce, petition or otherwise invoke or cause the Trust to invoke the process
of the United States, 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 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 or all
or any part of the property or assets of the Trust or ordering the winding up or
liquidation of the affairs of the Trust.
17. No Recourse. The Escrow Agent shall have no recourse to
the Underlying Securities with respect to any fees owed to the Escrow Agent
under Section 7 of this agreement. This Section 17 shall not be read as limiting
any right the Escrow Agent may have to the Underlying Securities pursuant to any
security, call right or other instrument, obligation or agreement the Trust may
issue or enter into from time to time.
5
IN WITNESS WHEREOF, the parties hereto have executed this
Escrow Agreement as of the day and year first above written.
PPLUS TRUST SERIES RRD-1
By: THE BANK OF NEW YORK, solely in its
capacity as Trustee under the Trust
Agreement and not in its individual
capacity
By: ________________________________________
Name:
Title:
____________, as Escrow Agent
By: ________________________________________
Name:
Title:
____________, as Holder
By: ________________________________________
Name:
Title:
