EXECUTION COPY
CorTS(R) SUPPLEMENT 2001-4
between
STRUCTURED PRODUCTS CORP.,
as Depositor
and
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee
CorTS(R)Trust For First Union Institutional Capital I
TABLE OF CONTENTS
Page
Preliminary Statement ............................................1
Section 1. Certain Defined Terms.................................1
Section 2. Creation and Declaration of Trust; Sale of Term
Assets; Acceptance by Trustee.........................5
Section 3. Designation..........................................5
Section 4. Date of the Certificates..............................5
Section 5. Certificate Principal Balance and Denominations;
Additional Term Assets................................6
Section 6. Currency of the Certificates..........................6
Section 7. Form of Securities....................................6
Section 8. Reserved..............................................6
Section 9. Certain Provisions of Base Trust Agreement Not
Applicable............................................6
Section 10. Distributions.........................................6
Section 11. Termination of Trust.................................10
Section 12. Limitation of Powers and Duties......................10
Section 13. Compensation of Trustee..............................11
Section 14. Modification or Amendment............................11
Section 15. Accounting...........................................12
Section 16. No Investment of Amounts Received on Term Assets....12
Section 17. No Event of Default..................................12
Section 18. Notices..............................................12
Section 19. Access to Certain Documentation......................12
Section 20. Advances.............................................13
Section 21. Ratification of Agreement............................13
Section 22. Counterparts.........................................13
Section 23. Governing Law........................................13
Section 24. Affiliate Exchange Right.............................13
Section 25. Certificate of Compliance............................13
Exhibit A-- Identification of the Term Assets as of Closing Date
Exhibit B-- Terms of the Certificates as of Closing Date
Exhibit C-- Form of Certificates
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CorTS(R) SUPPLEMENT 2001-4, dated as of January 30, 2001 (this
"Series Supplement"), between STRUCTURED PRODUCTS CORP., a
Delaware corporation, as depositor (the "Depositor"), and U.S.
Bank TRUST National Association, a national banking association,
as trustee (the "Trustee").
PRELIMINARY STATEMENT
Pursuant to the Base Trust Agreement, dated as of December 15, 2000
(the "Base Trust Agreement" and, as supplemented pursuant to the Series
Supplement, the "Agreement"), between the Depositor and the Trustee, such
parties may at any time and from time to time enter into a series supplement
supplemental to the Base Trust Agreement for the purpose of creating a trust.
Section 5.13 of the Base Trust Agreement provides that the Depositor may at any
time and from time to time direct the Trustee to authenticate and deliver, on
behalf of any such trust, a new Series of trust certificates. Each trust
certificate of such new Series of trust certificates will represent a fractional
undivided beneficial interest in such trust. Certain terms and conditions
applicable to each such Series are to be set forth in the related series
supplement to the Base Trust Agreement.
Pursuant to this Series Supplement, the Depositor and the Trustee
shall create and establish a new trust to be known as CorTS(R) Trust For First
Union Institutional Capital I, and a new Series of trust certificates to be
issued thereby, which certificates shall be known as the CorTS(R) Certificates,
and the Depositor and the Trustee shall herein specify certain terms and
conditions in respect thereof.
The Certificates shall be Fixed Rate Certificates issued in one Class
(the "Certificates").
On behalf of and pursuant to the authorizing resolutions of the Board
of Directors of the Depositor, an authorized officer of the Depositor has
authorized the execution, authentication and delivery of the Certificates, and
has authorized the Base Trust Agreement and this Series Supplement in accordance
with the terms of Section 5.13 of the Base Trust Agreement.
Section 1. Certain Defined Terms. (a) All terms used in this Series
Supplement that are defined in the Base Trust Agreement, either directly or by
reference therein, have the meanings assigned to such terms therein, except to
the extent such terms are defined or modified in this Series Supplement or the
context requires otherwise. The Base Trust Agreement also contains rules as to
usage which shall be applicable hereto.
(b) Pursuant to Article I of the Base Trust Agreement, the meaning of
certain defined terms used in the Base Trust Agreement shall, when applied to
the trust certificates of a particular Series, be as defined in Article I but
with such additional provisions and modifications as are specified in the
related series supplement. With respect to the Certificates, the following
definitions shall apply:
"Acceleration": The acceleration of the maturity of the Term Assets after
the occurrence of any default on the Term Assets other than a Payment Default.
"Agreement": Agreement shall have the meaning specified in the Preliminary
Statement to this Series Supplement.
"Base Trust Agreement": Base Trust Agreement shall have the meaning
specified in the Preliminary Statement to this Series Supplement.
"Business Day": Any day other than a Saturday, Sunday or a day on which
banking institutions in New York, New York are authorized or obligated by law,
executive order or governmental decree to be closed.
"Certificateholder" or "Holder": With respect to any Certificate, the
Holder thereof.
"Certificateholders" or "Holders": The Holders of the Certificates.
"Closing Date": January 30, 2001.
"Certificate Account": With respect to this Series, the Eligible Account
established and maintained by the Trustee in its corporate trust department in
the Trustee's name for the benefit of the related Certificateholders, into which
all payments made on or with respect to the related Term Assets will be
deposited.
"Collection Period": The period from (but excluding) the preceding
Distribution Date (or, in the case of the first Distribution Date, from and
including the Closing Date), through and including the current Distribution
Date.
"Corporate Trust Office": U.S. Bank Trust National Association, 000 Xxxx
Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate Trust or such
other corporate trust office as the Trustee shall designate in writing to the
Depositor and the Certificateholders.
"Depositary": The Depository Trust Company.
"Distribution Date": Any Scheduled Distribution Date, the Maturity Date or
any Term Assets Default Distribution Date or any Term Assets Redemption
Distribution Date.
"Event Redemption Price": Event Redemption Price shall have the meaning
specified in Section 10(h) of this Series Supplement.
"Extension Period": The period, up to ten (10) consecutive semiannual
interest distribution dates on the Term Assets, but not to extend beyond
December 1, 2026, in which First Union Corporation, and consequently the Term
Assets Issuer, defers distributions on the Term Assets.
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"Fixed Payment": Each equal semiannual installment of interest payable on
the Term Assets on each June 1 and December 1 or, if any such day is not a
Business Day, then the immediately following Business Day, commencing on June 1,
2001 through and including December 1, 2026.
"Interest Collections": With respect to any Distribution Date, all payments
received by the Trustee, during the Collection Period ending on such
Distribution Date, in respect of (i) interest on the Term Assets and (ii)
penalties or other amounts required to be paid because of late payments on the
Term Assets.
"Junior Subordinated Debentures": Means the 8.04% Junior Subordinated
Deferrable Interest Debentures due on the Maturity Date issued by First Union
Corporation which are owned by the Term Assets Issuer.
"Maturity Date": December 1, 2026.
"Optional Redemption": Optional Redemption shall have the meaning specified
in Section 10(h) of this Series Supplement.
"Optional Redemption Price": Optional Redemption Price shall have the
meaning specified in Section 10(h) of this Series Supplement.
"Payment Default": A default by the Term Assets Issuer in the payment of
any amount due on the Term Assets after the same becomes due and payable (and
the expiration of any applicable grace period on the Term Assets).
"Place of Distribution": New York, New York.
"Rating Agency": Each of Xxxxx'x Investors Service, Inc. ("Moody's"), and
Standard & Poor's Ratings Services ("S&P"), a division of The XxXxxx-Xxxx
Companies, Inc., and any successor to either of the foregoing. References to
"the Rating Agency" in the Agreement shall be deemed to be each such credit
rating agency.
"Record Date": With respect to any Distribution Date, the day immediately
preceding such Distribution Date.
"Regulatory Capital Event": Regulatory Capital Event means the receipt by
First Union Corporation of an opinion of an independent bank regulatory counsel
experienced in such matters to the effect that, as a result of (i) any amendment
to, or change (including any announced prospective change) in, the law (or
regulations thereunder) of the United States or any rules, guidelines or
policies of the Federal Reserve Board, or (ii) any official administrative
pronouncement or judicial decision interpreting or applying such laws or
regulations, which amendment or change is effective or such pronouncement or
decision is announced on or after the date of issuance of the Term Assets, the
Term Assets do not constitute, or within 90 days of the date of such opinion,
will not constitute, tier 1 capital (or its then equivalent); provided, however,
that the distribution of the Junior Subordinated Debentures in connection with
the liquidation of the Term Assets Issuer shall not in and of itself constitute
a Regulatory Capital Event unless such liquidation shall have occurred in
connection with a Tax Event.
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"Scheduled Distribution Date": The first day of each June and December or,
if any such day is not a Business Day, then the immediately following Business
Day, commencing June 1, 2001, through and including December 1, 2026; provided,
however, that payment on each Scheduled Distribution Date shall be subject to
prior payment of interest or principal, as applicable, on the Term Assets.
"Special Event": Special Event shall have the meaning specified in Section
10(h) of this Series Supplement.
"Special Event Redemption": Special Event Redemption shall have the meaning
specified in Section 10(h) of this Series Supplement. "Special Event Redemption
Price":
Special Event Redemption Price shall have the meaning specified in Section
10(h) of this Series Supplement.
"Specified Currency": United States Dollars.
"Tax Event": Tax Event means the receipt by the Term Assets Issuer of an
opinion of counsel experienced in such matters to the effect that, as a result
of any amendment to, or change (including any announced prospective change) in,
the laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
such pronouncement or decision is announced on or after the date of issuance of
the Term Assets, there is more than an insubstantial risk that (a) the Term
Assets Issuer is, or will be within 90 days of the date of such opinion, subject
to United States federal income tax with respect to income received or accrued
on the Junior Subordinated Debentures, (b) interest payable by First Union
Corporation on the Junior Subordinated Debentures is not, or within 90 days of
the date of such opinion, will not be, deductible by First Union Corporation, in
whole or in part, for United States federal income tax purposes, or (c) the Term
Assets Issuer is, or will be within 90 days of the date of such opinion, subject
to more than a de minimis amount of other taxes, duties or other governmental
charges.
"Term Assets": As of the Closing Date, $46,455,000 aggregate principal
amount of 8.04% Capital Securities issued by the Term Assets Issuer, sold to the
Trustee by the Depositor and identified on Exhibit A hereto. Additional Term
Assets may also be sold to the Trustee from time to time pursuant to Section 5
of this Series Supplement.
"Term Assets Default Distribution Date": The date on which the Trustee
makes a distribution of the proceeds received in connection with a recovery on
the Term Assets (in the case of Payment Default, after deducting any costs
incurred in connection therewith) following a Payment Default or an Acceleration
or other default with respect to the Term Assets.
"Term Assets Issuer": First Union Institutional Capital I, the sole asset
of which is the Junior Subordinated Debentures.
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"Term Assets Payment Date": Unless the Extension Period is in effect, the
first day of each June and December, commencing on June 1, 2001 and ending on
December 1, 2026; provided, however, that if any Term Assets Payment Date would
otherwise fall on a day that is not a Business Day, such Term Assets Payment
Date will be the following Business Day.
"Term Assets Prospectus": The prospectus of the Term Assets Issuer, dated
January 15, 1997, with respect to the Term Assets.
"Term Assets Redemption Distribution Date": The date on which the Trustee
makes a distribution of the proceeds received upon a redemption of Term Assets
in accordance with their terms.
"Term Assets Trustee": The trustee for the Term Assets.
"Trust": CorTS(R)Trust For First Union Institutional Capital I.
"Trust Termination Event": (a) the payment in full at maturity or upon
early redemption of the Certificates or (b) the distribution of the proceeds
received upon a recovery on the Term Assets (in the case of Payment Default,
after deducting the costs incurred in connection therewith) after a Payment
Default or an Acceleration thereof (or other default with respect to the Term
Assets).
"Voting Rights": The Certificateholders shall have 100% of the total Voting
Rights with respect to the Certificates, which Voting Rights shall be allocated
among all Holders of Certificates in proportion to the principal balances held
by such Holders on any date of determination.
Section 2. Creation and Declaration of Trust; Sale of Term Assets;
Acceptance by Trustee. (a) The Trust, of which the Trustee is the trustee, is
hereby created under the laws of the State of New York for the benefit of the
holders of the Certificates. The Trust shall be irrevocable.
(b) The Depositor, concurrently with the execution and delivery hereof and
pursuant to Section 2.1 of the Base Trust Agreement, has delivered or caused to
be delivered to the Trustee the Term Assets.
(c) The Depositor does hereby sell, transfer, assign, set over and
otherwise convey to the Trustee on behalf and for the benefit of the holders of
the Certificates and the Trust, without recourse, the Term Assets. The Trustee
shall pay the purchase price for the Term Assets by delivering to, or at the
direction of, the Depositor, all of the Certificates on the Closing Date and
making the payment identified in Section 10(l) of this Series Supplement.
(d) The Trustee hereby (i) acknowledges such sale, deposit and delivery,
pursuant to subsections (b) and (c) above, and receipt by it of the Term Assets,
(ii) accepts the trusts created hereunder in accordance with the provisions
hereof and of the Base Trust Agreement but subject to the Trustee's obligation,
as and when the same may arise, to make any payment or other distribution of the
assets of the Trust as may be required pursuant to this Series Supplement, the
Base Trust Agreement and the Certificates, and (iii) agrees to perform the
duties herein or therein required and any failure to receive reimbursement of
expenses and
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disbursements under Section 13 hereof shall not release the Trustee
from its duties herein or therein.
Section 3. Designation. There is hereby created a Series of trust
certificates to be issued pursuant to the Base Trust Agreement and this Series
Supplement to be known as the "CorTS(R) Certificates." The Certificates shall be
issued in one class, in the amount set forth in Section 5 and with the
additional terms set forth in Exhibit B to this Series Supplement. The
Certificates shall be issued in substantially the form set forth in Exhibit C to
this Series Supplement with such necessary or appropriate changes as shall be
approved by the Depositor and the Trustee, such approval to be manifested by the
execution and authentication thereof by the Trustee. The Certificates shall
evidence undivided ownership interests in the assets of the Trust, subject to
the liabilities of the Trust and shall be payable solely from payments or
property received by the Trustee on or in respect of the Term Assets.
Section 4. Date of the Certificates. The Certificates that are
authenticated and delivered by the Trustee to or upon Depositor Order on the
Closing Date shall be dated the Closing Date. All other Certificates that are
authenticated after the Closing Date for any other purpose under the Agreement
shall be dated the date of their authentication.
Section 5. Certificate Principal Balance and Denominations; Additional Term
Assets. On the Closing Date, up to 1,821,942 Certificates with a Certificate
Principal Balance of $45,548,550 may be authenticated and delivered under the
Base Trust Agreement and this Series Supplement. The Certificate Principal
Balance shall initially equal 98.0487% of the initial principal amount of Term
Assets sold to the Trustee and deposited in the Trust. Such Certificate
Principal Balance shall be calculated without regard to Certificates
authenticated and delivered upon registration of transfer of, or in exchange
for, or in lieu of, other Certificates pursuant to Sections 5.3, 5.4 or 5.5 of
the Base Trust Agreement. The Depositor may sell to the Trustee additional Term
Assets on any date hereafter upon at least five (5) Business Days notice to the
Trustee and upon (i) satisfaction of the Rating Agency Condition and (ii)
delivery of an Opinion of Counsel to the effect that the sale of such additional
Term Assets will not materially increase the likelihood that the Trust would
fail to qualify as a grantor trust under the Code. Upon such sale to the
Trustee, the Trustee shall deposit such additional Term Assets in the
Certificate Account, and shall authenticate and deliver to the Depositor, or its
order, Certificates in a Certificate Principal Balance equal to 98.0487% of the
principal amount of such additional Term Assets. Any such additional
Certificates authenticated and delivered shall rank pari passu with any
Certificates previously issued in accordance with this Series Supplement.
Section 6. Currency of the Certificates. All distributions on the
Certificates will be made in the Specified Currency.
Section 7. Form of Securities. The Trustee shall execute and deliver the
Certificates in the form of one or more global certificates registered in the
name of DTC or its nominee.
Section 8. Reserved.
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Section 9. Certain Provisions of Base Trust Agreement Not Applicable. The
provisions of Sections 2.3, 3.2, 3.3, 3.4, 3.5, 3.6, 3.8, 3.10, 3.11, 3.12,
5.16, 5.17, 6.1(c) through (e), 6.6 and 9.1 of the Base Trust Agreement and any
other provision of the Base Trust Agreement, which imposes obligations on, or
creates rights in favor of, the Trustee or the Certificateholders as a result of
or in connection with an "Event of Default" or "Administrative Agent Termination
Event" shall be inapplicable with respect to the Certificates. In addition,
there is no "Administrative Agent" specified herein, and all references to
"Administrative Agent" in the Base Trust Agreement therefore shall be
inapplicable with respect to the Certificates.
Section 10. Distributions.
(a) On each Scheduled Distribution Date, the Trustee shall distribute to
the Certificateholders the related Fixed Payment, to the extent of Interest
Collections, and on the Maturity Date shall distribute to the Certificateholders
the principal balance of the Certificates (in the amount of $45,548,550) and an
additional distribution of principal of $906,450, to the extent the principal of
the Term Assets is received by the Trustee on such date, and all other amounts
held in the Trust; provided, however, if any such payment with respect to the
Term Assets is made to the Trustee after the Term Assets Payment Date on which
such payment was due, the Trustee shall distribute such amount received on the
Business Day following such receipt. In the event the Extension Period is in
effect, interest on the Certificates will continue to accrue so long as interest
on the Junior Subordinated Debentures continues to so accrue, but the Trustee
shall not be required to make any distributions on the Certificates until the
next Scheduled Distribution Date following the end of the Extension Period. The
Depositor hereby advises the Trustee that during an Extension Period, interest
will continue to accrue on the Junior Subordinated Debentures at a rate of 8.04%
per annum, compounded semiannually, but interest will accrue on the Certificates
at a rate that is lower than the Certificates' 8.20% per annum stated interest
rate. If interest distributions are deferred for the maximum permissible period
(10 consecutive semiannual interest periods) and all deferred interest (plus
interest thereon) is then distributed, Certificateholders will realize an
annualized return of 8.17%, compounded semiannually, for the five-year period.
(b) In the event of a Payment Default, the Trustee shall proceed against
the Term Assets Issuer on behalf of the Certificateholders to enforce the Term
Assets or otherwise to protect the interests of the Certificateholders, subject
to the receipt of indemnity in form and substance satisfactory to the Trustee;
provided that, holders of the Certificates representing a majority of the Voting
Rights on the Certificates will be entitled to direct the Trustee in any such
proceeding or direct the Trustee to sell the Term Assets, subject to the
Trustee's receipt of satisfactory indemnity. If the Trustee is directed to sell
the Term Assets, the Trustee shall solicit bids for the sale of the Term Assets
with settlement thereof on or before the third (3rd) Business Day after such
sale from three leading dealers in the relevant market. Any of the following
dealers shall be deemed to qualify as leading dealers: (1) Credit Suisse First
Boston Corporation, (2) Xxxxxxx, Xxxxx & Co., (3) Xxxxxx Brothers Inc., (4)
Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated, (5) UBS Securities LLC and
(6) Xxxxxxx Xxxxx Xxxxxx Inc.; provided, however, that no bid from Xxxxxxx Xxxxx
Xxxxxx Inc. or any affiliate thereof shall be accepted unless such bid equals
the then fair market value of such Term Assets. The Trustee shall not be
responsible for the failure to obtain a bid so long as it has made reasonable
efforts to obtain bids.
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If a bid for the sale of the Term Assets has been accepted by the Trustee but
the sale has failed to settle on the proposed settlement date, the Trustee shall
request new bids from such leading dealers. In the event of an Acceleration and
a corresponding payment on the Term Assets, the Trustee shall distribute the
proceeds to the Certificateholders no later than two (2) Business Days after the
receipt of immediately available funds.
(c) In the event that the Trustee receives money or other property in
respect of the Term Assets (other than a scheduled payment on or with respect to
an interest payment date) as a result of a Payment Default on the Term Assets
(including from the sale thereof), the Trustee will promptly give notice as
provided in Section 18(c) to the Depositary, or for any Certificates which are
not then held by DTC or any other depository, directly to the registered holders
of the Certificates then outstanding and unpaid. Such notice shall state that,
not later than 30 days after the receipt of such moneys or other property, the
Trustee will allocate and distribute such moneys or other property to the
holders of Certificates then outstanding and unpaid, pro rata by principal
amount (after deducting the costs incurred in connection therewith and subject
to clause (l) of this Section 10). Property other than cash will be liquidated
by the Trustee, and the proceeds thereof distributed in cash, only to the extent
necessary to avoid distribution of fractional securities to Certificateholders.
In-kind distribution of Term Assets to Certificateholders will be deemed to
reduce the principal amount of Certificates on a dollar-for-dollar basis.
Following such in kind distribution, all Certificates will be cancelled. Other
than as provided in clause (l) below, no amounts will be distributed to the
Depositor in respect of the Term Assets.
(d) Distributions to the Certificateholders on each Distribution Date will
be
made to the Certificateholders of record on the Record Date.
(e) All distributions to Certificateholders shall be allocated pro rata
among the Certificates based on their respective principal balances as of the
Record Date.
(f) Notwithstanding any provision of the Agreement to the contrary, to the
extent funds are available, the Trustee will initiate payment in immediately
available funds by 10:00 A.M. (New York City time) on each Distribution Date of
all amounts payable to each Certificateholder with respect to any Certificate
held by such Certificateholder or its nominee (without the necessity for any
presentation or surrender thereof or any notation of such payment thereon) in
the manner and at the address as each Certificateholder may from time to time
direct the Trustee in writing fifteen (15) days prior to such Distribution Date
requesting that such payment will be so made and designating the bank account to
which such payments shall be so made. The Trustee shall be entitled to rely on
the last instruction delivered by the Certificateholder pursuant to this Section
10(f) unless a new instruction is delivered fifteen (15) days prior to a
Distribution Date.
(g) Upon receipt by the Trustee of a notice that all or a portion of the
Term Assets are to be redeemed, the Trustee shall select by lot for redemption a
principal amount of Certificates equal to 98.0487% of the principal amount of
the Term Assets to be redeemed and establish the Term Assets Redemption
Distribution Date. Notice of such redemption shall be given by the Trustee to
the registered Certificateholders not less than fifteen (15) days prior to the
Term Assets Redemption Distribution Date by mail to each registered
Certificateholder at
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such registered Certificateholder's last address on the register maintained by
the Trustee; provided, however, that the Trustee shall not be required to give
any notice of redemption prior to the third Business Day after the date it
receives notice of such redemption. The redemption price for Certificates
redeemed pursuant to a Special Event Redemption (as defined below) is set forth
below in Section 10(h) of this Series Supplement.
(h) For informational purposes only, the Term Assets as originally issued
are redeemable, in whole or in part, on or after December 1, 2006, at the option
of the Term Assets Issuer (an "Optional Redemption"). The Depositor hereby
advises the Trustee that the redemption price of the Term Assets in the case of
an Optional Redemption (the "Optional Redemption Price") will be equal to the
percentage of the outstanding principal amount of the Term Assets specified
below, plus, in each case, accrued interest on the principal amount being
redeemed to the date of redemption:
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Date Percentage
December 1, 2006 to November 30, 2006..................... 104.026%
December 1, 2007 to November 30, 2007..................... 103.618%
December 1, 2008 to November 30, 2008..................... 103.216%
December 1, 2009 to November 30, 2009..................... 102.814%
December 1, 2010 to November 30, 2010..................... 102.412%
December 1, 2011 to November 30, 2011..................... 102.010%
December 1, 2012 to November 30, 2012..................... 101.608%
December 1, 2013 to November 30, 2013..................... 101.206%
December 1, 2014 to November 30, 2014..................... 100.804%
December 1, 2015 to November 30, 2015..................... 100.402%
December 1, 2016 and thereafter........................... 100.000%
Where the Term Assets are redeemed due to an Optional Redemption, the
Certificates will be redeemed according to the following redemption price:
Redemption Price
Date per Certificate
December 1, 2006 to November 1, 2007......................... $26.52
December 1, 2007 to November 1, 2008......................... $26.42
December 1, 2008 to November 1 2009......................... $26.31
December 1, 2009 to November 1, 2010......................... $26.21
December 1, 2010 to November 1, 2011......................... $26.11
December 1, 2011 to November 1, 2012......................... $26.01
December 1, 2012 to November 1 2013......................... $25.90
December 1, 2013 to November 1, 2014......................... $25.80
December 1, 2014 to November 1, 2015......................... $25.70
December 1, 2015 to November 1, 2016......................... $25.60
December 1, 2016 and thereafter.............................. $25.49
In addition, if a Tax Event or a Regulatory Capital Event (collectively, a
"Special Event") occurs and is continuing, within 90 days following the
occurrence of such Special Event, First Union Corporation will have the right to
prepay the Junior Subordinated Debentures in whole but not in part and therefore
cause a mandatory redemption of the Term Assets (such redemption, a "Special
Event Redemption"). The redemption price in the case of a Special Event
Redemption (the "Special Event Redemption Price") will equal the greater of (i)
100% of the principal amount of the Term Assets or (ii) the sum of the present
values of the principal amount and premium payable as part of the Optional
Redemption Price with respect to an Optional Redemption of the Term Assets on
December 1, 2006, together with scheduled payments of interest from the
redemption date to December 1, 2006, in each case discounted to the redemption
date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day
months) at a certain treasury rate plus 0.50%, plus, in each case, accrued
interest thereon to the redemption date.
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(i) In the event the Junior Subordinated Debentures are distributed to the
Trust as a result of the liquidation of the Term Assets Issuer, such
distribution will not cause the Certificates to be redeemed. Instead, the Trust
will hold the Junior Subordinated Debentures for the Certificateholders in
accordance with the terms hereof and the Base Trust Agreement.
(j) The holder of a Certificate which is redeemed will receive, on the Term
Assets Redemption Distribution Date, a payment equal to its pro rata share of
the distributions made on the Term Assets pursuant to an Optional Redemption or
a Special Event Redemption as set forth above.
(k) The rights of the Certificateholders to receive distributions in
respect of the Certificates, and all interests of the Certificateholders in such
distributions, shall be as set forth in this Series Supplement. The Trustee
shall in no way be responsible or liable to the Certificateholders nor shall any
Certificateholder in any way be responsible or liable to any other
Certificateholder in respect of amounts previously distributed on the
Certificates based on their respective principal balances.
(l) On the Closing Date, as partial payment for the Term Assets, the
Trustee shall deliver to, or at the direction of, the Depositor all of the
Certificates. On June 1, 2001, as payment of the balance of the purchase price
for the Term Assets, the Trustee shall pay to the Depositor the amount of the
interest accrued on the Term Assets from December 1, 2000 to but not including
the Closing Date, which amount equals $612,122.05. In the event the Depositor is
not paid such accrued interest on such date, the Depositor shall have a claim
for the amount specified in the preceding sentence and shall share pari passu
with Certificateholders to the extent of such claim in the proceeds from the
sale of the Term Assets.
Section 11 . Termination of Trust. (a) The Trust shall terminate upon the
occurrence of any Trust Termination Event.
(b) Except for any reports and other information required to be provided to
Certificateholders hereunder and under the Base Trust Agreement and except as
otherwise specified herein and therein, the obligations of the Trustee will
terminate upon the distribution to Certificateholders of all amounts required to
be distributed to them and the disposition of all Term Assets held by the
Trustee. The Trust shall thereupon terminate, except for surviving rights of
indemnity.
Section 12 . Limitation of Powers and Duties. (a) The Trustee shall
administer the Trust and the Term Assets solely as specified herein and in the
Base Trust Agreement.
(b) The Trust is constituted solely for the purpose of acquiring and
holding the Term Assets. The Trustee is not authorized to acquire any other
investments or engage in any activities not authorized herein and, in
particular, unless expressly provided in the Agreement, the Trustee is not
authorized (i) to sell, assign, transfer, exchange, pledge, set-off or otherwise
dispose of any of the Term Assets, once acquired, or interests therein,
including to Certificateholders, (ii) to merge or consolidate the Trust with any
other entity, or (iii) to do anything that would materially increase the
likelihood that the Trust will fail to qualify as a grantor trust for United
States federal income tax purposes. In addition, the Trustee has no power to
11
create, assume or incur indebtedness or other liabilities in the name of the
Trust other than as contemplated herein and in the Base Trust Agreement.
(c) The parties acknowledge that the Trustee, as the holder of the Term
Assets, has the right to vote and give consents and waivers in respect of the
Term Assets and enforce the other rights, if any, of a holder of the Term
Assets, except as otherwise limited by the Base Trust Agreement or this Series
Supplement. In the event that the Trustee receives a request from the Term
Assets Trustee, the Term Assets Issuer or, if applicable, the Depositary with
respect to the Term Assets, for the Trustee's consent to any amendment,
modification or waiver of the Term Assets, or any document relating thereto, or
receives any other solicitation for any action with respect to the Term Assets,
the Trustee shall within two (2) Business Days mail a notice of such proposed
amendment, modification, waiver or solicitation to each Certificateholder of
record as of the date of such request. The Trustee shall request instructions
from the Certificateholders as to what action to take in response to such
request and shall be protected in taking no action if no direction is received.
Except as otherwise provided herein, the Trustee shall consent or vote, or
refrain from consenting or voting, in the same proportion (based on the
principal balances of the Certificates) as the Certificates of the Trust were
actually voted or not voted by the Holders thereof as of the date determined by
the Trustee prior to the date such vote or consent is required; provided,
however, that, notwithstanding anything to the contrary in the Base Trust
Agreement or this Series Supplement, the Trustee shall at no time vote in favor
of or consent to any matter (i) which would alter the timing or amount of any
payment on the Term Assets (including, without limitation, any demand to
accelerate the Term Assets) or (ii) which would result in the exchange or
substitution of any Term Asset whether or not pursuant to a plan for the
refunding or refinancing of such Term Asset, except in each case with the
unanimous consent of the Certificateholders and subject to the requirement that
such vote would not materially increase the likelihood that the Trust will fail
to qualify as a grantor trust for federal income tax purposes, such
determination to be based solely on an Opinion of Counsel. The Trustee shall
have no liability for any failure to act or to refrain from acting resulting
from the Certificateholders' late return of, or failure to return, directions
requested by the Trustee from the Certificateholders.
(d) Notwithstanding any provision of the Agreement to the contrary, the
Trustee may require from the Certificateholders prior to taking any action at
the direction of the Certificateholders, an indemnity agreement of a
Certificateholder or any of its Affiliates to provide for security or indemnity
against the costs, expenses and liabilities the Trustee may incur by reason of
any such action. An unsecured indemnity agreement, if acceptable to the Trustee,
shall be deemed to be sufficient to satisfy such security or indemnity
requirement.
(e) Notwithstanding any provision of the Agreement to the contrary, the
Trustee shall act as the sole Authenticating Agent, Paying Agent and Registrar.
Section 13. Compensation of Trustee. Each of the Trustee and U.S. Bank
National Association, as co-trustee (the "co-trustee") shall be entitled to
receive from the Depositor as compensation for its services hereunder, trustee's
fees pursuant to a separate agreement among the Trustee, the co-trustee and the
Depositor, and shall be reimbursed for all reasonable expenses, disbursements
and advances incurred or made by it (including the reasonable compensation,
disbursements and expenses of its counsel and other persons not regularly in its
12
employ). The Depositor shall indemnify and hold harmless each of the Trustee and
the co-trustee and its successors, assigns, agents and servants against any and
all loss, liability or reasonable expense (including attorney's fees) incurred
by it in connection with the administration of this trust and the performance of
its duties thereunder. The Trustee and the co-trustee shall notify the Depositor
promptly of any claim for which they may seek indemnity. Failure by the Trustee
and the co-trustee to so notify the Depositor shall not relieve the Depositor of
its obligations hereunder. The Depositor need not reimburse any expense or
indemnify against any loss, liability or expense incurred by the Trustee or the
co-trustee through the Trustee's or co-trustee's own willful misconduct,
negligence or bad faith. The indemnities contained in this Section 13 shall
survive the resignation or termination of the Trustee or the co-trustee or the
termination of this Agreement.
Failure by the Depositor to pay, reimburse or indemnify the Trustee or the
co-trustee shall not entitle the Trustee or the co-trustee to any payment,
reimbursement or indemnification from the Trust, nor shall such failure release
either the Trustee or the co-trustee from the duties it is required to perform
under this Series Supplement. Any unpaid, unreimbursed or unindemnified amounts
shall not be borne by the Trust and shall not constitute a claim against the
Trust, but shall be borne by each of the Trustee or the co-trustee in its
individual capacity, and the Trustee and the co-trustee shall have no recourse
against the Trust with respect thereto.
Section 14. Modification or Amendment. The Trustee shall not enter into any
modification or amendment of the Base Trust Agreement or this Series Supplement
unless such modification or amendment is in accordance with Section 10.1 of the
Base Trust Agreement. Pursuant to Section 5 of this Series Supplement, the
Depositor may sell to the Trustee additional Term Assets from time to time
without violation or trigger of this Section 14.
Section 15. Accounting. Notwithstanding Section 3.16 of the Base Trust
Agreement, Independent Public Accountants' Administration Report, no such
accounting reports shall be required. Pursuant to Section 4.2 of the Base Trust
Agreement, Reports to Certificateholders, the Trustee shall cause the statements
to be prepared and forwarded as provided therein.
Section 16. No Investment of Amounts Received on Term Assets. All amounts
received on or with respect to the Term Assets shall be held uninvested by the
Trustee.
Section 17. No Event of Default. There shall be no Events of Default
defined with respect to the Certificates.
Section 18 . Notices. (a) All directions, demands and notices hereunder and
under the Agreement shall be in writing and shall be deemed to have been duly
given when received if personally delivered or mailed by first class mail,
postage prepaid or by express delivery service or by certified mail, return
receipt requested or delivered in any other manner specified herein, (i) in the
case of the Depositor, to Structured Products Corp., 000 Xxxxxxxxx Xxxxxx, 0xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Secretary, or such other address as
may hereafter be furnished to the Trustee in writing by the Depositor, and (ii)
in the case of the Trustee, to U.S. Bank Trust National Association, 000 Xxxx
Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate Trust,
13
facsimile number (000) 000-0000, or such other address as may hereafter be
furnished to the Depositor in writing by the Trustee.
(b) For purposes of delivering notices to the Rating Agency under Section
10.07 of the Base Trust Agreement, Notice to Rating Agency, or otherwise, such
notices shall be mailed or delivered as provided in such Section 10.07, Notice
to Rating Agency, to: Standard & Poor's Ratings Services, 00 Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000; and Xxxxx'x Investors Service, Inc., Structured Derivative
Products, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; or such other address as
the Rating Agency may designate in writing to the parties hereto.
(c) In the event a Payment Default or an Acceleration occurs, the Trustee
shall promptly give notice to the Depositary or, for any Certificates which are
not then held by the Depositary or any other depository, directly to the
registered holders of the Certificates thereof. Such notice shall set forth (i)
the identity of the issue of Term Assets, (ii) the date and nature of such
Payment Default or Acceleration, (iii) the principal amount of the interest or
principal in default, (iv) the Certificates affected by the Payment Default or
Acceleration, and (v) any other information which the Trustee may deem
appropriate.
(d) Notwithstanding any provisions of the Agreement to the contrary, the
Trustee shall deliver all notices or reports required to be delivered to or by
the Trustee or the Depositor to the Certificateholders without charge to such
Certificateholders.
Section 19. Access to Certain Documentation. Access to documentation
regarding the Term Assets will be afforded without charge to any
Certificateholder so requesting pursuant to Section 3.17 of the Base Trust
Agreement, Access to Certain Documentation. Additionally, the Trustee shall
provide at the request of any Certificateholder without charge to such
Certificateholder the name and address of each Certificateholder of Certificates
hereunder as recorded in the Certificate Register for purposes of contacting the
other Certificateholders with respect to their rights hereunder or for the
purposes of effecting purchases or sales of the Certificates, subject to the
transfer restrictions set forth herein.
Section 20. Advances. There is no Administrative Agent specified herein;
hence no person (including the Trustee) shall be permitted or obligated to make
Advances as described in Section 4.3 of the Base Trust Agreement, Advances.
Section 21. Ratification of Agreement. With respect to the Series issued
hereby, the Base Trust Agreement (including the grant of a security interest in
Section 10.8 of the Base Trust Agreement with respect to the Term Assets
conveyed hereunder), as supplemented by this Series Supplement, is in all
respects ratified and confirmed, and the Base Trust Agreement as so supplemented
by this Series Supplement shall be read, taken and construed as one and the same
instrument. To the extent there is any inconsistency between the terms of the
Base Trust Agreement and this Series Supplement, the terms of this Series
Supplement shall govern.
Section 22. Counterparts. This Series Supplement may be executed in
anynumber of counterparts, each of which so executed shall be deemed to be an
original, but all of such counterparts shall together constitute but one and the
same instrument.
14
Section 23 . Governing Law. This Series Supplement and each Certificate issued
hereunder shall be governed by and construed in accordance with the laws of the
State of New York applicable to agreements made and to be performed entirely
therein without reference to such State's principles of conflicts of law to the
extent that the application of the laws of another jurisdiction would be
required thereby, and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.
Section 24 . Appointment of Co-Trustee. The Depositor and the Trustee hereby
appoint U.S. Bank National Association, a national banking association, as
co-trustee under the Agreement. Any action required to be taken by the Trustee
may be taken by U.S. Bank National Association, as co-trustee, in full
satisfaction of the obligations of the Trustee. By its acceptance of this Series
Supplement, U.S. Bank National Association hereby accepts its appointment as
co-trustee under the Agreement.
Section 25 . Certificate of Compliance. The Depositor shall deliver to the
Trustee on or prior to June 30 of each year prior to a Trust Termination Event
the Officer's Certificate as to compliance as required by Section 6.1(b) of the
Base Trust Agreement.
15
IN WITNESS WHEREOF, the parties hereto have caused this Series Trust
Agreement to be executed by their respective duly authorized officers as of the
date first above written.
STRUCTURED PRODUCTS CORP.
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------
Authorized Signatory
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------
Responsible Officer
ACCEPTED AND ACKNOWLEDGED BY:
U.S. BANK NATIONAL ASSOCIATION,
as Co-Trustee
By: /s/ Xxxxxxx X. Xxxxx
-------------------------
Responsible Officer
EXHIBIT A
IDENTIFICATION OF THE TERM ASSETS AS OF CLOSING DATE
Issuer: First Union Institutional Capital I
Term Assets: 8.04% Capital Securities due
December 1, 2026
Maturity Date: December 1, 2026
Original Principal Amount Issued: $500,000,000
CUSIP No.: 000000XX0
Stated Interest Rate: 8.04% per annum
Interest Payment Dates: June 1 and December 1
Optional Redemption: The Term Assets are redeemable, in
whole or in part, at the option of
the Term Assets Issuer, on or after
December 1, 2006, at a price equal
to 104.020% plus accrued interest
on December 1, 2006 and at
declining prices on each December 1
thereafter to 100.00% plus accrued
interest on or after December 1,
2016.
Special Event The Term Assets are redeemable, in
Redemption: whole but not in part, at any time
by the Term Assets Issuer if certain
adverse tax events occur with respect
to the Term Assets Issuer or First Union
Corporation or if a determination is made
that the Term Assets are not tier 1 capital.
Principal Amount of Term Assets
Deposited Under Trust Agreement: $46,455,000
The Term Assets will be held by the Trustee as book-entry credits to an account
of the Trustee or its agent at The Depository Trust Company, New York, New York
("DTC").
A-1
EXHIBIT B
TERMS OF THE CERTIFICATES AS OF CLOSING DATE
Maximum Number of CorTS(R)
Certificates Up to 1,821,942
Aggregate Principal Amount
of CorTS(R)Certificates: $45,548,550
Authorized Denomination: $25 and integral multiples thereof
Rating Agencies: Standard & Poor's Ratings Services,
and Xxxxx'x Investors Service, Inc.
Closing Date: January 30, 2001
Distribution Dates: June 1 and June 1, the Maturity Date,
any Term Assets Redemption
Distribution Date or any Term Assets
Default Distribution Date.
Interest Rate: 8.20% (subject to deferral of
interest)
Maturity Date: December 1, 2026
Record Date: With respect to any Distribution
Date, the day immediately preceding such
Distribution Date.
Trustee's Fees: The Trustee's fees shall be payable
by the Depositor pursuant to a
separate fee agreement between the
Trustee and the Depositor.
Initial Certificate Registrar: U.S. Bank Trust National Association
Corporate Trust Office: U.S. Bank Trust National Association
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust
Department, Regarding CorTS(R)Trust
For First Union Institutional Capital
B-1
EXHIBIT C
FORM OF CERTIFICATES
THIS CERTIFICATE REPRESENTS AN UNDIVIDED INTEREST IN THE TRUST AND DOES NOT
EVIDENCE AN OBLIGATION OF, OR AN INTEREST IN, AND IS NOT GUARANTEED BY THE
DEPOSITOR OR THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS
CERTIFICATE NOR THE TRUST ASSETS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL
AGENCY OR ANY OTHER PERSON.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC") OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
CERTIFICATE NUMBER R-1 1,821,942 Certificates
CUSIP: 22080W 20 5 $45,548,550 Certificate Principal Amount
CORTS(R) CERTIFICATES
evidencing an undivided interest in the Trust, as defined below, the assets of
which include First Union Institutional Capital I 8.04% Capital Securities due
December 1, 2026.
This Certificate does not represent an interest in or obligation of the
Depositor or any of its affiliates.
THIS CERTIFIES THAT Cede & Co. is the registered owner of a nonassessable,
fully-paid, fractional undivided interest in CorTS(R)Trust For First Union
Institutional Capital I (the "Trust") formed by Structured Products Corp., as
depositor (the "Depositor").
The Trust was created pursuant to a Base Trust Agreement, dated as of
December 15, 2000 (as amended and supplemented, the "Agreement"), between the
Depositor and U.S. Bank Trust National Association, a national banking
association, not in its individual capacity but solely as Trustee (the
"Trustee"), as supplemented by the CorTS(R) Supplement 2001-4, dated as of
January 30, 2001 (the "Series Supplement" and, together with the Agreement, the
"Trust Agreement"), between the Depositor and the Trustee. This Certificate does
not purport to summarize the Trust Agreement and reference is hereby made to the
Trust Agreement for information with respect to the interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
obligations of the Trustee with respect hereto.
C-1
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
"CorTS(R) Certificates" (herein called the "Certificate" or "Certificates").
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Trust Agreement, to which Trust Agreement the Holder of this
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound. The assets of the Trust include the Term Assets and all proceeds of
the Term Assets. Additional Term Assets may be sold to the Trustee and
additional Certificates may be authenticated and delivered from time to time as
provided in the Trust Agreement, which additional Certificates shall rank pari
passu with all other Certificates issued in accordance with the Series
Supplement.
Under the Trust Agreement, there shall be distributed on the dates
specified in the Trust Agreement (a "Distribution Date"), to the person in whose
name this Certificate is registered at the close of business on the related
Record Date, such Certificateholder's fractional undivided interest in the
amount of distributions of the Term Assets to be distributed to
Certificateholders on such Distribution Date. Unless an Extension Period is in
effect, the Term Assets will pay interest on June 1 and December 1 of each year
with the next interest payment date occurring on June 1, 2001. The principal of
the Term Assets is scheduled to be paid on December 1, 2026.
The distributions in respect of this Certificate are payable in such coin
or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts as set forth in the Series Trust
Agreement.
It is the intent of the Depositor and the Certificateholders that the
Trust will be classified as a grantor trust under subpart E, Part I of
subchapter J of the Internal Revenue Code of 1986, as amended. Except as
otherwise required by appropriate taxing authorities, the Depositor and the
Trustee, by executing the Trust Agreement, and each Certificateholder, by
acceptance of a Certificate, agrees to treat, and to take no action inconsistent
with the treatment of, the Certificates for such tax purposes as interests in a
grantor trust and the provisions of the Trust Agreement shall be interpreted to
further this intention of the parties.
Each Certificateholder, by its acceptance of a Certificate, covenants and
agrees that such Certificateholder shall not, prior to the date which is one
year and one day after the termination of the Trust Agreement, acquiesce,
petition or otherwise invoke or cause the Depositor to invoke the process of any
court or governmental authority for the purpose of commencing or sustaining a
case against the Depositor under any federal or state bankruptcy, insolvency,
reorganization or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Depositor or
any substantial part of its property, or ordering the winding up or liquidation
of the affairs of the Depositor.
The Trust Agreement permits the amendment thereof, in certain
circumstances, without the consent of the Holders of any of the Certificates.
C-2
Unless the certificate of authentication hereon shall have been executed
by an authorized officer of the Trustee by manual signature, this Certificate
shall not entitle the Holder hereof to any benefit under the Trust Agreement or
be valid for any purpose.
A copy of the Trust Agreement is available upon request and all of its
terms and conditions are hereby incorporated by reference and made a part
hereof.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
C-3
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed by its manual or facsimile signature.
U.S. BANK TRUST NATIONAL
ASSOCIATION, not in its individual
capacity but solely as Trustee and
Authenticating Agent
By:
--------------------------------
Authorized Signatory
