Exhibit 4.2
PPLUS TRUST CERTIFICATES SERIES LTD-1
SERIES SUPPLEMENT
between
XXXXXXX XXXXX DEPOSITOR, INC.,
as Depositor,
and
THE BANK OF NEW YORK,
as Trustee and Securities Intermediary
Dated as of April 7, 2006
SERIES SUPPLEMENT, dated as of April 7, 2006 (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(c)
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 March 1, 2011; (ii) a Call Holder designates as a Call
Date before March 1, 2011 after the announcement of any redemption of the
Underlying Securities or 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
redemption of the Underlying Securities or any unscheduled payment of the
Underlying Securities and prior to such redemption of the Underlying Securities
or unscheduled payment, then the Call Date designated by the Call Holder must be
the third Business Day prior to such redemption of the Underlying Securities or
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 1,000,000 Class A Certificates and all 1,000,000
Class B Certificates.
"Class A Allocation": The present value (discounted at the rate of 6.7%
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": 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. Any payments of interest on the Call Date by the Trust to the
applicable Class A Certificateholder shall be excluded.
"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.
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"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 6.7% 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 6.7% 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 6.7% 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 September 1, 2006
and ending on the Final Scheduled Distribution Date, a distribution of 0.25% 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": April 7, 2006.
"Collection Period": (i) With respect to each September 1 Distribution
Date, the period beginning on the day after the March 1 Distribution Date of the
current year and ending on such September 1 Distribution Date, inclusive, and
(ii) with respect to each March 1 Distribution Date, the period beginning on the
day after the September 1 Distribution Date of the prior year and ending on such
March 1 Distribution Date, inclusive, except for the September 1, 2006
Distribution Date, as to which the Collection Period shall be the period
beginning on the Cut-off Date and ending on such September 1, 2006 Distribution
Date, inclusive; provided, however, that clauses (i) and (ii) shall be subject
to Section 9(c) hereof.
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"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": April 7, 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": March 1 and September 1 of each year (or if such
date is not a Business Day, the next succeeding Business Day), commencing on
September 1, 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 (b) or (c) of the definition in Section 1.1 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
6.7% 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
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
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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 6.7% 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 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
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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.
(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
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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 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
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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 15(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": March 1, 2033 (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,
6.7% per annum and with respect to the Class B Certificates, 0.25% 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 March 29,
2006, as supplemented by the supplement dated March 31, 2006 relating to the
Class A Certificates and the Prospectus Supplement dated March 31, 2006, as
supplemented by the supplement dated March 31, 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 LTD-1.
"Underlying Securities": The $25,000,000 aggregate principal amount of
6.95% Exchange Debentures due 2033 issued by the Underlying Securities Issuer,
as described in Schedule I hereto.
"Underlying Securities Trust Agreement": As set forth in Schedule I.
"Underlying Securities Issuer": Limited Brands, Inc.
"Underlying Securities Prospectus Supplement": The prospectus
supplement dated May 6, 2003 filed with the Securities and Exchange Commission
by the Underlying Securities Issuer with respect to the Underlying Securities.
"Warrant Agreement": The Warrant Agreement, dated as of April 7, 2006,
by and between the Trust and the Warrant Agent (as defined in the Warrant
Agreement).
(c) 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"
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"Eligible Expense"
"Exchange Rate Agent"
"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 LTD-1". The Class A
Certificates and Class B Certificates evidencing certain undivided ownership
interests therein shall be known as the "PPLUS Class A 6.7% Callable Trust
Certificates Series LTD-1" and the "PPLUS Class B 0.25% Callable Trust
Certificates Series LTD-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
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the amount of the Underlying Securities in the Trust and the Trust may not issue
a corresponding amount of additional Certificates.
(c) The Class A Certificates will be entitled to receive (i) on each
Distribution Date, commencing on September 1, 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 6.7% 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 0.25% 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 6.7% per annum on the stated amount of the Class A
Certificates to holders of the Class A Certificates on such Distribution
Date and 0.25% 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 September 1, 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., 6.7/6.95 to the Class A
Certificateholders and 0.25/6.95 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
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Issuer as a result of a delay in the receipt by the Trustee of any interest
payment on the Underlying Securities;
(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
13
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.
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
14
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. 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
15
(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 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 15 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 15 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 15 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 14(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.
17
(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.
(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 other 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
18
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 LTD-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 LTD-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 LTD-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 14(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 14 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) As a holder of the Underlying Securities, the Trust may receive
redemption proceeds (the "Redemption Amount") upon the redemption of the
Underlying Securities, in whole or in part, by the Underlying Securities Issuer
pursuant to the Underlying Securities Indenture and the Underlying Securities
Prospectus Supplement (provided that, as described in the Prospectus Supplement,
no partial redemption of the Underlying Securities
20
may take place during a period when distributions are deferred). (i)
Upon the redemption of the Underlying Securities in whole, but not in part, (A)
on March 1, 2033 or (B) at the option of the Underlying Securities Issuer, upon
at least 30 days, but not more than 60 days, prior notice pursuant to the
Underlying Securities Indenture, the Redemption Amount will be distributed pro
rata to the holders of the Underlying Securities, including the Trust. Upon
receiving such Redemption Amount, the Trust shall distribute the Redemption
Amount first, pro rata to the Class A 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 Redemption 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 6.7% per annum) of the
Class B Payments on or after the Redemption Date (assuming, for purposes of such
calculation, that the Underlying Securities would have been paid in full on
March 1, 2033 with no such redemption or acceleration); and third, any remaining
Redemption Amount will be divided between the Classes of trust certificates in
accordance with a percentage equal to 6.7/6.95 of such amount to the Class A
Certificateholders and 0.25/6.95 of such amount to the Class B
Certificateholders, and within each class the Redemption Amount will be
distributed pro rata to the Certificateholders of the Class A or Class B
Certificates entitled to such Redemption Amount upon the date such Redemption
Amount is received in immediately available funds by the Trust if such
Redemption 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 redemption of the
Underlying Securities in part at the option of the Underlying Securities Issuer
upon at least 30 days, but not more than 60 days, prior notice pursuant to the
Underlying Securities Indenture, the Redemption Amount will be distributed pro
rata to the holders of the Underlying Securities, including the Trust. Upon any
such redemption 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 redemption 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 redemption in accordance
with the terms of the Warrant Agreement. Upon receiving such Redemption Amount,
the Trust shall distribute the Redemption 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 Redemption
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 6.7% per annum) of the Class B
Payments on or after the Redemption Date (assuming for purposes of such
calculation, that the Underlying Securities would have been paid in full on
March 1, 2033 with no such redemption or acceleration); and third, any remaining
Redemption Amount will be divided between the Classes of trust certificates in
accordance with a percentage equal to 6.7/6.95 of such amount to the Class A
Certificateholders and 0.25/6.95 of such amount to the Class B
Certificateholders, and within each class the Redemption Amount will be
distributed pro rata to the Certificateholders of the Class A or Class B
Certificates. Such Redemption Amount will be distributed to the Class A and
Class B Certificateholders entitled to
21
such Redemption Amount upon the date such Redemption Amount is received in
immediately available funds by the Trust if such Redemption 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 Redemption 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 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 Redemption 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 15 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 redemption of the Underlying Securities or other
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
22
by the Trustee to the Certificateholders in accordance with paragraph
(d) of this Section 15 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, 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 15(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
23
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.
(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
24
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 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 16.
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
25
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
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 LTD-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:
26
"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"
(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:
27
"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."
28
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: /s/ Xxxxxxx Xxxxxxxxxxxx
---------------------------------------
Name: Xxxxxxx Xxxxxxxxxxxx
Title: President
The Bank of New York,
not in its individual capacity
but as Trustee
By: /s/ Xxxxx Xxxxxxx
---------------------------------------
Name: Xxxxx Xxxxxxx
Title: Authorized Signatory
The Bank of New York,
as Securities Intermediary
By: /s/ Xxxxx Xxxxxxx
--------------------------------------
Name: Xxxxx Xxxxxxx
Title: Authorized Signatory
[SERIES SUPPLEMENT SIGNATURE PAGE]
SCHEDULE I
PPLUS TRUST CERTIFICATES, SERIES LTD-1
UNDERLYING SECURITIES SCHEDULE
Underlying Securities: 6.95% Exchange Debentures due 2033 of the Underlying Securities
Issuer, fully and unconditionally guaranteed by the Underlying
Securities Issuer.
Underlying Securities Issuer: Limited Brands, Inc., a Delaware corporation.
Underlying Securities Indenture: Indenture dated as of February 19, 2003, 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 June 3, 2003
Original Issue Date:
Underlying Securities $350,000,000 (principal amount $1,000 per security)
Original Amount Issued:
Underlying Securities 333-104633
Commission Filing Number:
Underlying Securities March 1, 2033
Maturity Date:
Underlying Securities March 1, 2033
Principal Payment Date:
Underlying Securities March 1 and September 1, or if any such date is not a business Interest
Payment Dates: day, then the next succeeding business day to the persons in
whose names the Underlying Securities are registered on the February 15 and
August 15 prior to the relevant payment date.
Underlying Securities 6.95% per annum.
Interest Rate:
Underlying Securities March 1 and September 1.
Record Dates:
Underlying Securities The Underlying Securities Issuer will have the option to redeem the Underlying
Redemption: 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, 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 35 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 and payable in U.S.
Authorized Denomination dollars and are available in minimum denominations of $1,000
and Specified Currency: and integral multiples thereof.
Underlying Securities "Baa2" with negative outlook by Xxxxx'x and "BBB" by S&P.
Rating as of Closing:
Underlying Securities Form: Book-entry security with DTC.
EXHIBIT A
Standard Terms for Trust Agreements
(begins on next page)
Exhibit A
STANDARD TERMS FOR TRUST AGREEMENTS
between
XXXXXXX XXXXX DEPOSITOR, INC.,
as Depositor,
and
THE BANK OF NEW YORK,
as Trustee and as Securities Intermediary
TRUST CERTIFICATES
Dated as of November 5, 2004
Reconciliation and tie between the Standard Terms, dated as of November
5, 2004, and the Trust Indenture Act of 1939, as amended. This reconciliation
and tie does not constitute part of the Standard Terms.
================================================================================
Trust Indenture Act Standard
of 1939 Section Terms Section
--------------------------------------------------------------------------------
310(a)(1) 7.07
--------------------------------------------------------------------------------
(a)(2) 7.07
--------------------------------------------------------------------------------
(a)(5) 7.07
--------------------------------------------------------------------------------
312(a) 7.14
--------------------------------------------------------------------------------
313(a) 7.16
--------------------------------------------------------------------------------
314(a) 3.10
--------------------------------------------------------------------------------
(c)(1) 1.03
--------------------------------------------------------------------------------
(c)(2) 1.03
--------------------------------------------------------------------------------
(e) 1.03
--------------------------------------------------------------------------------
315(a)(1) 7.01
--------------------------------------------------------------------------------
315(a)(2) 7.03
--------------------------------------------------------------------------------
315(b) 7.01(d)
--------------------------------------------------------------------------------
315(d) 7.01(c)
--------------------------------------------------------------------------------
316(a)(1)(A) 5.19
--------------------------------------------------------------------------------
(a)(1)(B) 5.20
--------------------------------------------------------------------------------
(b) 5.21
--------------------------------------------------------------------------------
(c) 1.03(b)
--------------------------------------------------------------------------------
317(a)(1) 5.18
--------------------------------------------------------------------------------
(b) 5.13
--------------------------------------------------------------------------------
318(a) 11.11
================================================================================
TABLE OF CONTENTS
Article I DEFINITIONS AND ASSUMPTIONS.......................................1
Section 1.01. Definitions...............................................1
Section 1.02. Rules of Construction. Unless the context
otherwise requires:......................................13
Section 1.03. Compliance Certificates and Opinions; Record Date........13
Article II DECLARATION OF TRUSTS; ISSUANCE OF CERTIFICATES;
PURPOSE AND CLASSIFICATION OF TRUSTS............................14
Section 2.01. Creation and Declaration of Trusts;
Assignment of Deposited Assets...........................14
Section 2.02. Acceptance by Trustee....................................15
Section 2.03. Representations and Warranties of the Depositor..........15
Section 2.04. Breach of Representation, Warranty or Covenant...........16
Section 2.05. Agreement to Execute, Authenticate and Deliver
Certificates.............................................16
Section 2.06. Custody and Holding of Deposited Assets..................16
Article III ADMINISTRATION OF EACH TRUST...................................17
Section 3.01. Administration of Each Trust.............................17
Section 3.02. Collection of Certain Underlying Security Payments.......17
Section 3.04. Distribution or Sale of the Underlying Securities........18
Section 3.05. Investment of Funds in the Accounts......................19
Section 3.06. Maintenance of Credit Support............................19
Section 3.07. Realization upon Defaulted Underlying Securities.........19
Section 3.08. Retained Interest........................................20
Section 3.09. Access to Certain Documentation..........................20
Section 3.10. Reports by the Depositor.................................20
Section 3.11. Charges and Expenses.....................................21
Article IV DISTRIBUTIONS AND REPORTS TO CERTIFICATEHOLDERS.................21
Section 4.01. Distributions............................................21
Section 4.02. Distributions on Certificates............................21
Section 4.03. Reports to Certificateholders............................22
Section 4.04. Advances.................................................23
Section 4.05. Allocation of Realized Losses and Trust Expenses.........23
Section 4.06. Compliance with Withholding Requirements.................23
Section 4.07. Optional Exchange........................................24
Section 4.08. Call Right...............................................25
Article V THE CERTIFICATES.................................................26
Section 5.01. The Certificates.........................................26
Section 5.02. Execution, Authentication and Delivery...................26
Section 5.03. Temporary Certificates...................................27
Section 5.04. Registration; Registration of Transfer and Exchange......27
Section 5.05. Mutilated, Destroyed, Lost and Stolen Certificates.......28
Section 5.06. Persons Deemed Owners....................................29
Section 5.07. Cancellation.............................................29
- i -
Section 5.08. Global Securities........................................29
Section 5.09. Notices to Depository....................................30
Section 5.10. Definitive Certificates..................................30
Section 5.11. Currency of Distributions................................31
Section 5.12. Conditions of Execution, Authentication and
Delivery of New Series...................................31
Section 5.13. Appointment of Paying Agent..............................33
Section 5.14. Authenticating Agent.....................................33
Section 5.15. Voting Rights with Respect to Underlying Securities......34
Section 5.16. Actions by Certificateholders............................34
Section 5.17. Events of Default........................................35
Section 5.18. Judicial Proceedings Instituted by Trustee;
Trustee May Bring Suit...................................35
Section 5.19. Control by Certificateholders............................35
Section 5.20. Waiver of Past Defaults..................................35
Section 5.21. Right of Certificateholders to Receive Payments
Not to Be Impaired.......................................36
Section 5.22. Remedies Cumulative......................................36
Article VI THE DEPOSITOR...................................................36
Section 6.01. Liability of the Depositor...............................36
Section 6.02. Limitation on Liability of the Depositor.................36
Section 6.04. Merger or Consolidation of the Depositor.................37
Section 6.05. No Liability of the Depositor with Respect
to the Underlying Securities; Certificateholders
to Proceed Directly Against the Underlying
Securities Issuer(s).....................................37
Article VII THE TRUSTEE....................................................37
Section 7.01. Duties of Trustee........................................37
Section 7.02. Agreements Between Trustee and Administrative Agents.....40
Section 7.03. Certain Matters Affecting the Trustee....................41
Section 7.04. Trustee Not Liable for Recitals in Certificates or
Underlying Securities....................................42
Section 7.05. Trustee May Own Certificates.............................42
Section 7.06. Trustee's Fees and Expenses..............................42
Section 7.07. Eligibility Requirements for Trustee.....................42
Section 7.08. Resignation or Removal of the Trustee; Appointment
of Successor Trustee.....................................43
Section 7.09. Appointment of Office or Agency..........................45
Section 7.10. Representations and Warranties of Trustee................45
Section 7.11. Indemnification of Trustee by the Depositor;
Contribution.............................................45
Section 7.12. No Liability of the Trustee with Respect
to the Underlying Securities; Certificateholders
to Proceed Directly Against the Underlying
Securities Issuer(s).....................................46
Section 7.13. The Depositor to Furnish Trustee with Names
and Addresses of Certificateholders......................46
Section 7.14. Preservation of Information..............................47
Section 7.15. Reports by Trustee.......................................47
Section 7.16. Trustee's Application for Instructions from
the Depositor............................................47
- ii -
Article VIII MARKET AGENT..................................................47
Section 8.01. Market Agent.............................................47
Article IX SECURITIES INTERMEDIARY.........................................47
Section 9.01. Resignation or Removal of the Securities Intermediary;
Appointment of Successor Securities Intermediary.........47
Article X TERMINATION......................................................49
Section 10.01. Termination upon Liquidation of All
Underlying Securities....................................49
Article XI MISCELLANEOUS PROVISIONS........................................50
Section 11.01. Amendment...............................................50
Section 11.02. Limitation on Rights of Certificateholders..............51
Section 11.03. Governing Law...........................................52
Section 11.04. Notices.................................................52
Section 11.05. Notice to Rating Agencies...............................52
Section 11.06. Severability of Provisions..............................53
Section 11.07. Nonpetition Covenant....................................53
Section 11.08. No Recourse.............................................53
Section 11.09. Article and Section References..........................53
Section 11.10. Counterparts............................................53
Section 11.11. Trust Indenture Act.....................................53
- iii -
STANDARD TERMS FOR TRUST AGREEMENTS dated as of November 5, 2004
between XXXXXXX XXXXX DEPOSITOR, INC., a Delaware corporation, as Depositor (the
"Depositor"), and THE BANK OF NEW YORK, a New York corporation, as Trustee (in
such capacity, the "Trustee") and as securities intermediary (in such capacity,
the "Securities Intermediary").
PRELIMINARY STATEMENT
The Depositor, the Trustee and the Securities Intermediary have duly
authorized the execution and delivery of these Standard Terms for Trust
Agreements (the "Standard Terms") to provide for one or more Series (and one or
more Classes within each such Series) of Certificates, issuable from time to
time as provided in these Standard Terms.
Each such Series (inclusive of any Classes specified within such
Series) will be issued under a separate Supplement to these Standard Terms, duly
executed and delivered by the Depositor, the Trustee and the Securities
Intermediary. With respect to each Series, these Standard Terms and all
amendments hereof and, unless the context otherwise requires, the related
Supplement and all amendments thereto shall be known as the "Trust Agreement".
All representations, covenants and agreements made herein by each of
the Depositor, the Trustee and the Securities Intermediary are for the benefit
and security of the Holders and, to the extent provided in the applicable
Supplement, for the benefit and security of any Credit Support Provider or any
other party as specified therein.
The Depositor and the Securities Intermediary are entering into these
Standard Terms, and the Trustee is accepting the trust created hereby, for good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged.
ARTICLE I
DEFINITIONS AND ASSUMPTIONS
Section 1.01. Definitions. Except as otherwise specified herein or in
the applicable Supplement or as the context may otherwise require, the following
terms have the respective meanings set forth below for all purposes of this
Trust Agreement.
"Account": As defined in Section 3.05.
"Accounting Date": With respect to any Series, if applicable, as
defined in the related Supplement.
"Administration Account": As defined in Section 7.02.
"Administrative Agent": Any Person with which the Trustee has entered
into an Administration Agreement and that meets the qualifications of an
Administrative Agent, pursuant to Section 7.02.
"Administration Agreement": The written contract, if any, between the
Trustee and an Administrative Agent and any successor Trustee or Administrative
Agent providing that the Trustee can delegate certain of its administrative
obligations with respect to any Series hereunder.
"Administrative Agent Termination Event": With respect to any given
Series, any of the following: (i) any failure by an Administrative Agent to
remit to the Trustee any funds in respect of collections on the Underlying
Securities and Credit Support, if any, as required under this Trust Agreement,
that continues unremedied for five days after the giving of written notice of
such failure to the Administrative Agent by the Trustee or the Depositor, or to
the Administrative Agent, the Depositor and the Trustee by the Holders of not
less than 25% of the Voting Rights; (ii) any failure by an Administrative Agent
duly to observe or perform in any material respect any of its other covenants or
obligations under the Administration Agreement with respect to such Series that
continues unremedied for thirty days after the giving of written notice of such
failure to the Administrative Agent by the Trustee or the Depositor, or to the
Administrative Agent, the Depositor and the Trustee by the Holders of not less
than 25% of the Voting Rights; and (iii) events of insolvency, readjustment of
debt, marshalling of assets and liabilities or similar proceedings and certain
actions by or on behalf of an Administrative Agent indicating its insolvency or
inability to pay its obligations. Any additional
Administrative Agent Termination Event with respect to any given Series may be
set forth in the applicable Supplement.
"Advance": As defined in Section 4.04.
"Affiliate": With respect to any specified Person, any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control", when used with respect to any specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Allocation Ratio": With respect to any Series, as defined in the
related Supplement.
"Authenticating Agent": As defined in Section 5.14.
"Authorized Denomination": The minimum denomination in which a
Certificate may be issued, or any multiple thereof, as specified in the related
Supplement.
"Available Funds": Unless otherwise specified in the applicable
Supplement, for any Distribution Date in respect of a given Series or Class, the
sum of (i) all amounts actually received on or with respect to the Underlying
Securities (including Liquidation Proceeds and investment income earned on
Account funds invested pursuant to Section 3.05) with respect to such Series
during the related Collection Period, (ii) all amounts received pursuant to any
Credit Support Instruments with respect to such Series for such Distribution
Date and (iii) all other amounts, if any, specified by the applicable Supplement
less any amount held for the benefit of the Retained Interest.
"Beneficial Owner": With respect to Certificates held through a
Depository, the beneficial owner of a Certificate. For purposes only of Section
5.16, the Trustee shall be obligated to treat a Person who claims to be a
beneficial owner of a Certificate as a "Beneficial Owner" within the meaning of
the Supplement only if such Person has first delivered to the Trustee, (i) a
certificate or other writing executed by such Person stating the full name and
address of such Person, the principal distribution amount of the Certificate
with respect to which such Person claims to be the Beneficial Owner, and the
participant in the Depository ("such Person's Participant") through which such
Person holds its beneficial ownership interest in the Certificates and (ii) a
certificate or other writing executed by such Person's Participant confirming
that such Person's Participant holds on its own books and records Certificates
for the account of such Beneficial Owner and identifying the principal
distribution amount held for such Beneficial Owner.
"Book-Entry Securities": Securities maintained in the form of entries
(including, without limitation, the Security Entitlements in such Securities) in
the commercial book-entry system of the Fed and held for the Trustee, directly
or indirectly, by any Trustee's Fed Member. Book-Entry Securities shall not
include, in any event, any Certificated Security (or any Security Entitlement in
any Certificated Security) held, directly or indirectly, through a Clearing
Corporation.
"Business Day": With respect to any Series, as defined in the related
Supplement.
"Calculation Agent": If applicable with respect to any Series, as
specified in the applicable Supplement.
"Call Date": The date on which the Call Right may be exercised, as
specified in the applicable Supplement.
"Call Price": If applicable with respect to any Series, as specified in
the applicable Supplement.
"Callable Series": A Series or Class within such Series subject to a
Call Right, as specified in the applicable Supplement.
2
"Call Right": The right of the holder thereof (or any successor), as
named in the applicable Supplement, to purchase Certificates from the Holders
thereof or to purchase Underlying Securities from the Trust.
"Call Terms": The terms pursuant to which a Call Right may be
exercised, as set forth in the applicable Supplement.
"Certificate" and "Certificates": Any trust certificate or trust
certificates authorized by, executed pursuant to and authenticated and delivered
under, this Trust Agreement, and unless the context requires otherwise,
"Certificate" and "Certificates" shall also be deemed to refer to the Retained
Interest.
"Certificate Account": As defined in Section 3.03.
"Certificate Principal Balance": With respect to an Outstanding
Certificate, as determined at any time, the maximum amount that the Holder
thereof is entitled to receive as distributions allocable to principal payments
on the Underlying Securities. The Certificate Principal Balance, if any, of any
Class within a given Series (other than those Classes, if any, specified in the
related Supplement), as of any date of determination, shall be equal to the
aggregate initial Certificate Principal Balance thereof less the sum of (i) all
amounts allocable to prior distributions made to such Class in respect to
principal of the Underlying Securities, (ii) any reductions attributable to
Certificates surrendered in exchange for Underlying Securities, as and to the
extent provided in the applicable Supplement, and (iii) any reductions in the
Certificate Principal Balance thereof deemed to have occurred in connection with
allocations of (A) Realized Losses in respect of principal of the Underlying
Securities and (B) expenses of the Trust if any only to the extent specified in
the applicable Supplement, each as allocated to such Class pursuant to the
applicable Supplement.
"Certificate Register" and "Certificate Registrar": As defined in
Section 5.04.
"Certificated Security": As defined in Section 8-102(a)(4) of the UCC.
"Certificateholder": Any holder of a Certificate or a Retained
Interest.
"Class": With respect to any Series, any one of the classes of
Certificates of such Series, each class consisting of Certificates having
identical terms.
"Clearing Agency": An organization that (i) is registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act and (ii) is a
Clearing Corporation.
"Clearing Agency Participant": At any time, in respect of any Clearing
Agency, a securities intermediary that maintains Securities Accounts with such
Clearing Agency at such time.
"Clearing Corporation": The meaning specified in Section 8-102(a)(5) of
the UCC.
"Closing Date": With respect to any Series, the day on which
Certificates of such Series are first executed, authenticated and delivered, as
specified in the related Supplement.
"Code": The Internal Revenue Code of 1986, as amended, and Treasury
Regulations promulgated thereunder.
"Collection Period": With respect to any Distribution Date for a Series
(or Class within such Series), the period specified in the related Supplement.
"Commission": The Securities and Exchange Commission, as from time to
time constituted, created under the Exchange Act or, if at any time after the
execution and delivery of this Trust Agreement such Commission is not existing
and performing the duties now assigned to it, then the body then performing such
duties.
"Concentrated Underlying Securities": Any Underlying Securities that
constitute 10% or more of the total Underlying Securities with respect to a
Series of Certificates.
3
"Corporate Trust Office": The principal corporate trust office of the
Trustee located at the address set forth in the related Supplement or such other
address as the Trustee may designate from time to time by notice to the Holders
and the Depositor, or the principal corporate trust office of any successor
Trustee (or such other addresses as a successor Trustee may designate from time
to time by notice to the Holders and the Depositor).
"Credit Support": As specified in the related Supplement, a Letter of
Credit, Limited Guaranty, Surety Bond, Swap Agreement, Swap Guarantee, or other
asset intended to support or ensure the timely or ultimate distributions of
amounts due in respect of a Series (or Class within such Series).
"Credit Support Instrument": The instrument or document pursuant to
which the Credit Support for a given Series (or Class within such Series) is
provided, as specified in the applicable Supplement.
"Credit Support Provider": With respect to any Series (or Class within
such Series), the Person, if any, that will provide any Credit Support with
respect to all or a portion of a Series or Class, as specified in the applicable
Supplement.
"Cut-off Date": With respect to any Series, the date specified as such
in the related Supplement. For purposes of this Trust Agreement, any Underlying
Security acquired by the Depositor after the applicable Cut-off Date but prior
to the applicable Closing Date and included in the related Trust as of such
Closing Date shall be deemed to have been Outstanding as of such Cut-off Date
and references to the principal balance of such Underlying Security as of such
Cut-off Date shall be deemed to be to the principal balance of such Underlying
Security as of the date on which it was acquired by the Depositor.
"Definitive Certificates": As defined in Section 5.10.
"Deposited Assets": With respect to any Series, the following assets,
properties and items (together with the accounts and book-entry accounts
containing or reflecting, directly or indirectly, such assets, properties and
items), in each case, wherever located, however held and whether now existing or
hereafter acquired:
(i) all Underlying Securities and Related Assets;
(ii) all payments receivable or received in respect of the
Underlying Securities including the immediate and continuing right to
claim for, collect, receive and give receipt for principal, premium, if
any, and interest payments in respect of the Underlying Securities and
all other monies payable thereunder;
(iii) all Financial Assets, Security Entitlements and Investment
Property in, constituting, evidenced by, resulting from or otherwise
related to, any of the Deposited Assets;
(iv) all other rights and remedies (but none of the obligations)
comprising, arising or resulting from or related to the Grant of the
Deposited Assets including, without limitation, the right to give and
receive notices and other communications, to make waivers or other
agreements, to exercise all rights and options of the Depositor, to
bring Proceedings in the name of the Depositor or otherwise, and
generally to exercise all of the rights and remedies of the Depositor
and to do and receive anything that the Depositor is or may be entitled
to do or receive thereunder or with respect thereto; and
(v) any other assets identified as Deposited Assets in the related
Supplement, which assets may include cash, cash equivalents,
guarantees, letters of credit, financial insurance, interest rate,
currency, equity, commodity and credit-linked swaps, caps, floors,
collars and options, forward contracts, structured securities and other
instruments and transactions that credit enhance, hedge or otherwise
support the Underlying Securities designed to assure the servicing or
timely distribution of payments to Holders.
"Depositor": Xxxxxxx Xxxxx Depositor, Inc., a Delaware corporation,
and, if a successor Person shall have become the Depositor pursuant to any
applicable provisions of this Trust Agreement, "Depositor" shall mean such
successor Person. With respect to any
4
provisions of this Trust Agreement that relate to the provisions of the TIA,
"Depositor" shall include any obligor on the Certificates as the term obligor is
defined in the TIA.
"Depositor Order": A written order or request, respectively, signed in
the name of the Depositor by any one of its Executive Officers.
"Depository": With respect to the Certificates of any Series (or Class
within such Series) issuable in whole or in part in the form of one or more
Global Securities, the Person so designated in the applicable Supplement, and,
if at any time there is more than one such Person, "Depository" as used with
respect to the Certificates of any such Series or Class shall mean the
Depository with respect to the Certificates of that Series or Class.
"Discount Certificate": Any Certificate that is issued with "original
issue discount" within the meaning of Section 1273(a) of the Code and any other
Certificate designated by the Depositor as issued with original issue discount
for United States Federal income tax purposes.
"Distribution Date": With respect to any Series (or Class within such
Series), each date specified as a "Distribution Date" for such Series (or Class)
in the related Supplement.
"Distribution Election": With respect to any Series, as specified in
the related Supplement.
"Dollar" or "$" or "USD": Such currency of the United States as at the
time of payment is legal tender for the payment of public and private debts.
"Depository Securities": Securities consisting of Security Entitlements
to Certificated Securities, held by the Depository or a Clearing Corporation or
a nominee of either subject to the control of the Depository and in bearer form
or indorsed in blank by an appropriate Person or registered on the books of the
issuer thereof in the name of the Depository or its Clearing Corporation or a
nominee of either.
"DCR": Xxxx & Xxxxxx Credit Rating Co. and any successor thereto.
"Eligible Account": Either (i) an account or accounts maintained with a
Federal or State chartered depository institution or trust company the long-term
unsecured obligations of which are rated by the Rating Agency the higher of (x)
at least the then current long-term rating of the Certificates or (y) in one of
its two highest long-term rating categories (unless otherwise specified in the
Supplement) at the time any amounts are held in deposit therein or (ii) a trust
account(s) maintained as a segregated account(s) and held by a Federal or State
chartered depository institution or trust company in trust for the benefit of
the Certificateholders; provided, however, that such depository institution or
trust company has a long-term rating in one of the four highest categories by
the Rating Agency.
"Eligible Investments": With respect to any Series, unless otherwise
specified in the related Supplement, any one or more of the following
obligations or securities; provided, however, that the total stated return
specified by the terms of each such obligation or security is at least equal to
the purchase price thereof; and provided further that no such instrument may
carry the symbol "r" from S&P in its rating:
(i) direct obligations of, and obligations fully guaranteed by,
the United States, the Federal Home Loan Mortgage Corporation, the
Federal National Mortgage Association, the Federal Farm Credit System
or any agency or instrumentality of the United States the obligations
of which are backed by the full faith and credit of the United States;
provided, however, that obligations of, or guaranteed by, the Federal
Home Loan Mortgage Corporation, the Federal National Mortgage
Association or the Federal Farm Credit System shall be Eligible
Investments only if, at the time of investment, such investment has the
rating specified in such Supplement for Eligible Investments;
(ii) demand and time deposits in, certificates of deposit of, or
banker's acceptances issued by any depository institution or trust
company (including the Trustee or any agent of the Trustee acting in
their respective commercial capacities) incorporated under the laws of
the United States or any State and
5
subject to supervision and examination by Federal and/or State banking
authorities so long as the commercial paper and/or the short-term debt
obligations of such depository institution or trust company (or, in the
case of a depository institution which is the principal subsidiary of a
holding company, the commercial paper or other short-term debt
obligations of such holding company) at the time of such investment or
contractual commitment providing for such investment have the rating
specified in such Supplement for Eligible Investments; provided,
however, that such rating shall be no lower than the lower of the
rating on the Underlying Securities or the Trust Certificates at the
time of purchase of the investments;
(iii) securities bearing interest or sold at a discount issued by
any corporation incorporated under the laws of the United States or any
State that have the rating specified in such Supplement for Eligible
Investments at the time of such investment or contractual commitment
providing for such investment; provided, however, that such rating
shall be no lower than the lower of the rating on the Underlying
Securities or the Trust Certificates; and provided further that
securities issued by any particular corporation will not be Eligible
Investments to the extent that investment therein will cause the then
outstanding principal amount of securities issued by such corporation
and held as part of the Trust for such Series to exceed 10% of the
aggregate outstanding principal balances and amounts of all the
Underlying Securities and Eligible Investments held as part of the
Trust for such Series; and
(iv) commercial paper having at the time of such investment the
rating specified in the Supplement for Eligible Investments.
"Entitlement Holder": As defined in Section 8-102(a)(7) of the UCC.
"Event of Default": With respect to any Series (or Class within such
Series), as specified in the related Supplement.
"Exchange Act": The Securities Exchange Act of 1934, as amended.
"Exchange Rate Agent": As specified in the Supplement.
"Executive Officer": With respect to any limited liability company or
corporation, the chief executive officer, the chief operating officer, the chief
financial officer, the president, any vice president, the secretary or the
treasurer of such limited liability company or corporation; with respect to any
partnership, any general partner xxxxxxx.
"Extraordinary Trust Expenses": Any and all costs, expenses or
liabilities arising out of the establishment, existence or administration of the
Trust, other than (i) Ordinary Expenses, and (ii) costs and expenses payable by
a particular Certificateholder, the Trustee or the Depositor pursuant to this
Trust Agreement. "Fed": The Federal Reserve Bank of New York.
"Fed Member Securities Account": In respect of any Person, an account
in the name of such Person at the Fed, to which account Book-Entry Securities
held for such Person are or may be credited.
"Federal Book-Entry Regulations": (a) the Federal regulations contained
in Subpart B ("Treasury/Reserve Automated Debt Entry System (TRADES)" governing
Book-Entry Securities consisting of U.S. Treasury bonds, notes and bills) and
Subpart D ("Additional Provisions") of 31 C.F.R. Part 357, 31 C.F.R. ss. 357.10
through ss. 357.14 and ss. 357.41 through ss. 357.44 (including related defined
terms in 31 C.F.R. ss. 357.2) and (b) to the extent substantially identical to
the federal regulations referred to in clause (a) above (as in effect from time
to time), the federal regulations governing other Book-Entry Securities.
"Final Scheduled Distribution Date": With respect to any Certificate,
the date on which all the unpaid principal of (and premium, if any, on) and
interest on such Certificate is scheduled, without giving effect to any
prepayment, exchange or early termination, to become due and payable as provided
therein and in the applicable Supplement.
6
"Financial Asset": As defined in Section 8-102(a)(9) of the UCC.
"Fitch": Fitch Investors Service, L.P., and any successor thereof.
"Fixed Pass-Through Rate": With respect to any Fixed Rate Certificate,
as defined in the related Supplement.
"Fixed Rate Certificate": A Certificate that provides for a payment of
interest at a Fixed Pass-Through Rate.
"Floating Pass-Through Rate": With respect to any Floating Rate
Certificate, as defined in the related Supplement.
"Floating Rate Certificate": A Certificate that provides for the
payment of interest at a Floating Pass-Through Rate determined periodically by
reference to a formula specified in the related Supplement.
"Global Security": A registered Certificate evidencing all or part of a
Series (or Class within such Series), issued to the Depository for such Series
or Class in accordance with Section 5.08 and bearing the legend prescribed
therein.
"Grant": To grant, bargain, sell, warrant, alienate, remise, demise,
release, convey, assign, transfer, deposit, set over and confirm to the Trustee
pursuant to these Standard Terms and the applicable Supplement; and the terms
"Granted" and "Granting" have the meanings correlative to the foregoing.
"Holder": The Person in whose name a Certificate or Retained Interest
is registered in the Certificate Register on the applicable Record Date. Where
the context requires, "Holder" may refer to the person entitled to exercise the
Voting Rights accompanying a Certificate.
"Independent": When used with respect to any Person means that such
Person (1) is in fact independent of the Depositor and of any Affiliate, (2)
does not have any direct or indirect material financial interest in the
Depositor or in any Affiliate and (3) is not connected with the Depositor or any
Affiliate as an officer, employee, promoter, underwriter, trustee, partner,
director or person performing similar functions.
"Investment Property": As defined in Section 9-115 of the UCC.
"Letter of Credit": With respect to any Series (or Class within such
Series), the letter of credit, if any, providing for the payment of all or a
portion of amounts due in respect of such Series (or Class), issued to the
Trustee for the benefit of the Holders of such Series (or Class), issued by the
related Credit Support Provider, all as specified in the related Supplement.
"Limited Guarantor": With respect to any Series (or Class within such
Series), a Person specified in the related Supplement as providing a guarantee
or insurance policy or other credit enhancement supporting the distributions in
respect of such Series (or Class within such Series) as and to the extent
specified in such Supplement.
"Limited Guaranty": With respect to any Series (or Class within such
Series), any guarantee of, or insurance policy or other comparable form of
credit enhancement with respect to, amounts required to be distributed in
respect of such Series (or Class) or payments under all or certain of the
Underlying Securities relating to such Series or Class, executed and delivered
by a Limited Guarantor in favor of the Trustee, for the benefit of the
Certificateholders, as specified in the related Supplement.
"Liquidation Price": If applicable with respect to any Series, the
price at which the Market Agent sells the Underlying Securities on behalf of the
Trustee, as specified in the applicable Supplement.
"Liquidation Proceeds": The amounts received by the Trustee in
connection with (i) the liquidation of a defaulted Underlying Security,
collateral, if any, related thereto, or Related Asset or (ii) the repurchase,
substitution or sale of an Underlying Security or Related Asset.
7
"Market Agent": The market agent or market agents, if any, appointed
pursuant to Section 8.01, and its or their successors or assigns.
"Market Agent Agreement": With respect to any Series, the agreement, if
any, dated as of the Closing Date, between the Trustee and the Market Agent, the
form of which will be attached to the related Supplement, and any similar
agreement with a successor Market Agent, in each case as from time to time
amended or supplemented.
"Xxxxxxx Xxxxx & Co.": Xxxxxxx Xxxxx & Co., a Delaware corporation.
"Minimum Wire Denomination": $10,000,000 or the equivalent in any
Specified Currency.
"Moody's": Xxxxx'x Investors Service, Inc. and any successors thereto.
"Notional Amount": With respect to any Class of Certificates, if
applicable, the initial notional amount specified in the related Supplement on
which distributions of interest may be determined at the applicable Pass-Through
Rate, as the same may be adjusted as specified in such Supplement.
"Officer's Certificate": A certificate signed by any (or, if specified
in these Standard Terms or any Supplement, more than one) Executive Officer of
the Depositor, and delivered to the Trustee.
"Opinion of Counsel": A written opinion of counsel, who may, except as
otherwise expressly provided in this Trust Agreement, be counsel for the
Depositor acceptable to the Trustee, except that any opinion of counsel relating
to the qualification of any account required to be maintained pursuant to this
Trust Agreement as an Eligible Account must be an opinion of counsel who is in
fact Independent of the Depositor.
"Optional Exchange": shall mean the exchange of Certificates of any
Series (or Class within such Series) for a pro rata portion of the Deposited
Assets of the related Trust.
"Optional Exchange Date": With respect to any Series (or Class within
such Series), as defined, if applicable, in the related Supplement.
"Optional Redemption": The right of an Underlying Securities Issuer to
redeem such Underlying Securities in accordance with the terms of the Underlying
Securities Indenture.
"Ordinary Expenses": The Trustee's customary fee for its services as
Trustee, as set forth in the related Supplement, including but not limited to
(i) the costs and expenses of preparing, sending and receiving all reports,
statements, notices, returns, filings, solicitation of consent or instructions,
or other communications required by this Trust Agreement, (ii) the costs and
expenses of holding and making ordinary collection or payments on the assets of
the Trust and of determining and making distributions, (iii) the costs and
expenses of the Trust's or Trustee's counsel, accountants and other experts for
ordinary or routine consultation or advice in connection with the establishment,
administration and termination of the Trust, and (iv) any other costs and
expenses that are, or reasonably should have been, expected to be incurred in
the ordinary course of administration of the Trust.
"Outstanding": With respect to Certificates of a specified Series (or
Class within such Series), as of any date of determination, all such
Certificates theretofore executed, authenticated and delivered under these
Standard Terms and the related Supplement except:
(i) Certificates theretofore cancelled by the Certificate
Registrar; and
(ii) Certificates, including Predecessor Certificates, in exchange
for or in lieu of which other Certificates have been executed,
authenticated and delivered pursuant to this Trust Agreement, unless
proof satisfactory to the Trustee is presented that any such
Certificates are held by a bona fide purchaser in whose hands such
Certificates are valid obligations of the Trust;
8
provided, however, that in determining whether any request, demand,
authorization, direction, notice, consent or waiver hereunder has been given by
the required percentage of the aggregate Voting Rights, Voting Rights
accompanying Certificates beneficially owned by the Depositor, the Trustee, or
any Affiliate thereof shall be disregarded and deemed not to be Outstanding, and
such Voting Rights shall not be taken into account in determining whether the
requisite percentage of aggregate Voting Rights necessary to effect any such
consent or take any such action has been obtained except that, in determining
whether the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Certificates with
respect to which the Depositor has provided the Trustee an Officer's Certificate
stating that such Certificates are so owned shall be so disregarded.
Certificates so owned that have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to such Certificates.
"Participant": A broker, dealer, bank, other financial institution or
other Person for whom from time to time a Depository effects book-entry
transfers and pledges of securities deposited with the Depository.
"Pass-Through Rate": With respect to any Series (or Class within such
Series) (except certain Discount Certificates and Certificates entitled to
nominal or no interest distributions), the annual rate at which interest accrues
on the Certificates of such Series (or Class), which may be a fixed rate or a
floating rate of interest, determined upon the basis and in the manner specified
in the related Supplement.
"Paying Agent": As defined in Section 5.13.
"Person": Any individual, limited liability company, corporation,
partnership, joint venture, association, joint stock company, trust (including
any beneficiary thereof), unincorporated organization or government or any
agency or political subdivision thereof.
"Predecessor Certificate": As defined in Section 5.05.
"Prepaid Ordinary Expenses": The amount (if any) paid by the Depositor
to the Trustee on or before the Closing Date to cover Ordinary Expenses, as
specified in the related Supplement.
"Proceeding": Any suit in equity, action at law or other judicial or
administrative proceeding.
"Rating Agency": With respect to any Series or Class within such
Series), each nationally recognized statistical rating organization, specified
in the related Supplement, that initially rates the Certificates of such Series
(or Class within such Series).
"Rating Agency Condition": With respect to any action or occurrence,
unless otherwise specified in the applicable Supplement, that each Rating Agency
shall have been given 10 days (or such shorter period acceptable to each Rating
Agency) prior written notice thereof and that each Rating Agency shall have
notified the Depositor and the Trustee in writing that such action or occurrence
will not result in a reduction or withdrawal of the then current rating of any
Certificate of the applicable Series.
"Realized Loss": With respect to any defaulted and liquidated
Underlying Security, the excess, if any, of (x) the price paid by the Depositor
for such Underlying Security plus expenses incurred by the Trustee in connection
with the practices and procedures referred to in Section 3.07(b) of these
Standard Terms, to the extent reimbursable under these Standard Terms and the
related Supplement, over (y) Liquidation Proceeds with respect thereto.
"Record Date": With respect to any Distribution Date for any Series (or
Class within such Series), the date specified in the related Supplement.
"Related Assets": Any assets held by a Trust the return of which is
linked to one or more Underlying Securities and which, if applicable, shall be
described in the related Supplement or a schedule thereto.
9
"Required Percentage--Amendment": Unless otherwise specified in the
related Supplement, if a Rating Agency Condition is specified in such Supplement
and such Rating Agency Condition is met, or, if a Rating Agency Condition is not
so specified in such Supplement, 66-2/3% of the aggregate Voting Rights of such
Series, and 100% otherwise.
"Required Percentage--Direction of Trustee": Unless otherwise specified
in the related Supplement, 66-2/3% of the aggregate Voting Rights of such
Series.
"Required Percentage--Remedies": Unless otherwise specified in the
related Supplement, 66-2/3% of the aggregate Voting Rights of such Series.
"Required Percentage--Removal of Securities Intermediary": Unless
otherwise specified in the related Supplement, more than 50% of the aggregate
Voting Rights of such Series.
"Required Percentage--Removal of Trustee": Unless otherwise specified
in the related Supplement, more than 50% of the aggregate Voting Rights of a
Series.
"Required Percentage--Waiver": Unless otherwise specified in the
related Supplement, 66-2/3% of the aggregate Voting Rights of a Series.
"Required Principal": As determined for any Distribution Date for a
given Series (or Class within such Series), unless otherwise specified in the
related Supplement, the amounts on deposit in the Certificate Account allocable
to principal payments on the Underlying Securities (including from Credit
Support, if any, and Advances, if any, but excluding amounts in respect of
principal payments to the extent that Advances with respect thereto were
distributed as Required Principal on a prior Distribution Date) and required to
be distributed in respect of the Certificates of such Series (or Class) in
accordance with the terms of such Certificates and such related Supplement.
"Requisite Reserve Amount": As of any date with respect to any Series
(or Class within such Series), the amount, if any, required to be maintained in
the Reserve Account, if any, for such Series or Class as specified in or
determined pursuant to the related Supplement.
"Reserve Account": An Eligible Account, if any, created and maintained
pursuant to Section 3.06.
"Responsible Officer": With respect to the Trustee, any officer within
the Corporate Trust Office, including any Managing Director, Senior Vice
President, Vice President, Assistant Vice President, Assistant Secretary or any
other officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers and also, with respect to a
particular matter, any other officer to whom such matter is referred because of
such officer's actual knowledge of and familiarity with the particular subject.
"Retained Interest": If applicable, with respect to any Underlying
Security, an ownership interest in and a right to a portion of the payments
thereon by the obligor thereof, as specified in the related Supplement, held by
the Person so specified in such Supplement.
"Sale Procedures": Unless otherwise specified in the Supplement, shall
mean that, with respect to any sale of one or more Underlying Securities or
Related Assets, the Market Agent, on behalf of the Trust, shall sell such
Underlying Securities or Related Assets to the highest bidders among not less
than two solicited bidders for such Underlying Securities or Related Assets (one
of which bidders may include Xxxxxxx Xxxxx & Co. or any Affiliate thereof;
provided, however, that neither Xxxxxxx Xxxxx & Co. nor any of its Affiliates
will be under any obligation to bid, and which bidders need not be limited to
recognized broker dealers). In the sole judgment of the Market Agent, bids may
be evaluated on the basis of bids for a single Underlying Security or Related
Asset, a portion of the Underlying Securities or Related Assets, or all of the
Underlying Securities or Related Assets being sold or any other basis selected
in good faith by the Market Agent.
"S&P": Standard & Poor's Ratings Services, and any successor thereof.
10
"Securities Account": As defined in Section 8-501(a) of the UCC.
"Securities Control": "Control" as defined in Section 8-106 of the UCC
and, for purposes of determining an interest in investment property under UCC
Article 9, Section 9-115(1)(e) of the UCC.
"securities intermediary": As defined in Section 8-102(a)(14) of the
UCC and, in respect of any Book-Entry Security, a "securities intermediary" (as
defined in 31 C.F.R. ss. 357.2 or, as applicable to such Book-Entry Security,
the corresponding Federal Book-Entry Regulations).
"Securities Intermediary": With respect to any Series, the Securities
Intermediary shall be the Person so specified in the applicable Supplement until
a successor Person shall have become the Securities Intermediary pursuant to the
applicable provisions of these Standard Terms and the applicable Supplement, and
thereafter "Securities Intermediary" shall mean such successor Person.
"Security": As defined in Section 8-102(a)(15) of the UCC.
"Security Certificate": As defined in Section 8-102(a)(9) of the UCC.
"Security Entitlement": As defined in Section 8-102(a)(17) of the UCC
or, in respect of any Book-Entry Security, as defined in 31 C.F.R. Section 357.2
(or, as applicable to such Book-Entry Security, the corresponding Federal
Book-Entry Regulations).
"Series": A separate series of Certificates issued pursuant to these
Standard Terms and a related Supplement, which series may be divided into two or
more Classes, as provided in such Supplement.
"Specified Currency": As specified in the related Supplement for the
applicable Series or Class, which may be a currency issued by the government of
any country or a composite currency the value of which is determined by
reference to the values of the currencies of any group of countries. If not
specified in the related Supplement, the Specified Currency shall be Dollars.
"State": Any one of the 50 states of the United States, or the District
of Columbia.
"Supplement": An agreement incorporating these Standard Terms that
authorizes the issuance of a particular Series (and each Class within such
Series) of Certificates.
"Surety Bond": If so specified in the Supplement with respect to any
Series (or Class within such Series), the surety bond providing for the
distribution under certain circumstances specified in such Supplement of amounts
to the Certificateholders of such Series (or Class), which surety bond will be
issued to the Trustee for the benefit of such Certificateholders by the related
Credit Support Provider, all as specified in such Supplement.
"Swap Agreement": If so specified in the Supplement with respect to any
Series, the ISDA Master Agreement dated as of the Closing Date by and between
the Trust and the Swap Counterparty, as the same may be amended or supplemented
from time to time as provided therein.
"Swap Counterparty": If so specified in the Supplement with respect to
any Series (or Class within such Series), as specified in such Supplement.
"Swap Distribution Amount": If so specified in the Supplement with
respect to any Series, all amounts then due and owing to the Swap Counterparty
pursuant to the Swap Agreement, other than Swap Termination Payments.
"Swap Guarantee": If so specified in the Supplement with respect to any
Series, the guarantee issued by the Swap Guarantor in favor of the Trust
substantially in the form attached as an exhibit to the Swap Agreement.
11
"Swap Guarantor": If so specified in the Supplement with respect to any
Series, the guarantor specified as such in such Supplement.
"Swap Receipt Amount": If so specified in the Supplement with respect
to any Series, all amounts due and owing to the Trust pursuant to the Swap
Agreement other than Swap Termination Payments.
"Swap Termination Payment": If so specified in the Supplement with
respect to any Series, the amount payable by the Swap Counterparty to the Trust,
or by the Trust to the Swap Counterparty, pursuant to the Swap Agreement.
"Tax Event": The right of an Underlying Securities Issuer to shorten
the maturity of or repurchase such Underlying Securities, in accordance with the
terms of the Underlying Securities Indenture, due to a change in the treatment
of such Underlying Securities under the Code.
"Trust": With respect to any Series, the segregated asset or pool of
assets subject hereto, constituting the trust created hereby and by the related
Supplement and to be administered hereunder and thereunder, consisting of those
Deposited Assets, the Credit Support, if applicable, and all sums distributed in
respect thereof that are specified as being part of the Trust for such Series in
the related Supplement, all for the benefit of the Certificateholders of such
Series as of any particular time.
"Trust Agreement": With respect to each Series, these Standard Terms
and all amendments hereof and, unless the context otherwise requires, the
related Supplement and all amendments thereto.
"Trustee": With respect to any Series, the Person so specified in the
applicable Supplement until a successor Person shall have become the Trustee
pursuant to the applicable provisions of these Standard Terms and the applicable
Supplement, and thereafter "Trustee" shall mean such successor Person.
"Trustee's Fed Member": Any Person that is eligible to maintain a Fed
Member Securities Account in such Person's name with the Fed and through which
the Trustee holds Book-Entry Securities.
"TIA": The Trust Indenture Act of 1939, as amended, as the same is in
force and effect as of the date hereof.
"UCC": The Uniform Commercial Code as in effect from time to time in
the State of New York and any successor statute.
"Underlying Securities Indenture": The indenture pursuant to which the
Underlying Securities were issued, as identified in the Underlying Securities
Schedule.
"Underlying Securities Issuer": With respect to an Underlying Security,
the issuer thereof (including, if applicable, the guarantor of the Underlying
Security), as identified in the Underlying Securities Schedule.
"Underlying Securities Schedule": Schedule I to the Supplement.
"Underlying Security" or "Underlying Securities": With respect to any
Series, the asset or assets identified in the Underlying Securities Schedule.
The Underlying Securities for any Series or the related Trust shall not
constitute Underlying Securities for any other Series or any other Trust.
"Underlying Security Interest Payment Date": With respect to an
Underlying Security, each date specified in the Underlying Securities Schedule
as a date on which interest is scheduled, as of the Closing Date, to be payable
by or on behalf of the Underlying Securities Issuer on such Underlying Security
in accordance with its terms.
"United States": The United States of America (including the States),
its territories, its possessions and other areas subject to its jurisdiction.
"Voting Rights": The voting rights with respect to the Underlying
Securities, which voting rights shall be allocated to Certificateholders of each
Class within a given
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Series (and to the holders of the Retained Interest and Call Right, if any) in
accordance with the Allocation Ratio.
Section 1.02. Rules of Construction. Unless the context otherwise
requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting
principles as in effect in the United States from time to time;
(iii) "or" is not exclusive;
(iv) the words "herein", "hereof", "hereunder" and other words of
similar import refer to this Trust Agreement as a whole and not to any
particular Article, Section or other subdivision;
(v) "including" means including without limitation; and
(vi) words in the singular include the plural and words in the
plural include the singular.
Section 1.03. Compliance Certificates and Opinions; Record Date. a)
Upon any application or request by the Depositor to the Trustee to take any
action under any provision of this Trust Agreement other than the initial
issuance of the Certificates, the Depositor shall furnish to the Trustee an
Officer's Certificate stating that, in the opinion of the signer thereof, all
conditions precedent, if any, provided for in this Trust Agreement relating to
the proposed action have been complied with and an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent, if any, have
been complied with, except that in the case of any such application or request
as to which the furnishing of such documents is specifically required by any
provision of this Trust Agreement relating to such particular application or
request, no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Trust Agreement (other than a
certificate provided pursuant to Section 3.10(d)) shall include:
(i) a statement that the individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(iii) a statement that, in the opinion of such individual, he or
she has made such examination or investigation as is necessary to
enable him or her to express an informed opinion as to whether or not
such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of such individual,
such condition or covenant has been complied with.
(b) The Depositor may at its option by delivery of an Officer's
Certificate to the Trustee set a record date to determine the Holders entitled
to give any consent, request, demand, authorization, direction, notice, waiver
or other act. Notwithstanding TIA Section 316(c), such record date shall be the
record date specified in such Officer's Certificate, which shall be a date not
more than 30 days prior to the first solicitation of Certificateholders in
connection therewith. If such a record date is fixed, such consent, request,
demand, authorization, direction, notice, waiver or other act may be given
before or after such record date, but only the Holders of record at the close of
business on such record date shall be deemed to be Holders for the purposes of
determining whether the requisite aggregate Voting Rights have authorized or
agreed or consented to such consent, request, demand, authorization, direction,
notice, waiver or other act, and for that purpose the aggregate Voting Rights
shall be computed as of such record date; provided, however, that no such
consent, request, demand, authorization, direction, notice, waiver or other act
by the Holders on such record date shall be deemed
13
effective unless it shall become effective pursuant to the provisions of this
Trust Agreement not later than one year after the record date.
ARTICLE II
DECLARATION OF TRUSTS; ISSUANCE OF CERTIFICATES;
PURPOSE AND CLASSIFICATION OF TRUSTS
Section 2.01. Creation and Declaration of Trusts; Assignment of
Deposited Assets. (a) The Depositor, concurrently with the execution and
delivery of the related Supplement, does hereby agree to Grant to the Trustee
for the benefit of the Trustee and the Certificateholders of each given Series
and without recourse, all the right, title and interest of the Depositor,
including any security interest therein for the benefit of the Depositor, in, to
and under the Underlying Securities and other Deposited Assets. Unless otherwise
specified in the Supplement, each such Grant will include all interest, premium
(if any) and principal of, on or with respect to any such Underlying Securities
due after the Cut-off Date and received by the Depositor, and will exclude all
interest, premium (if any) and principal of, on or with respect to any such
Underlying Securities due on or before the Cut-off Date. With respect to any
Concentrated Underlying Security, the Underlying Securities Schedule shall
include information regarding the payment terms of the Concentrated Underlying
Security, the maturity or terms thereof, the rating, if any, thereof and any
other material information with respect thereto.
(b) In connection with each Grant referred to in paragraph (a) of this
Section 2.01, the Depositor shall, not later than the applicable Closing Date,
either
(i) deposit the Underlying Securities for a given Series (except
for the Underlying Securities attributable to such Series that are to
be acquired from a Person other than the Depositor, as specified on the
Underlying Securities Schedule to the applicable Supplement) with the
Trustee by physical delivery of such Underlying Securities duly
endorsed, together with any documents necessary to transfer ownership
of such Underlying Securities, to the Trustee, or
(ii) have ensured that the Underlying Securities have been
delivered to a Clearing Agency, in which event (A) the Securities
Intermediary or its agent, on behalf of the Trustee, has accepted
delivery of such Underlying Securities through such Clearing Agency,
and (B) the Underlying Securities have been credited to a Securities
Account of the Trustee and maintained by the Securities Intermediary on
behalf of the Trustee, and the Securities Intermediary or its agent
shall have the right to hold and maintain such Underlying Securities on
deposit with such Clearing Agency for all purposes of this Trust
Agreement.
(c) In the case of each delivery of Underlying Securities referred to
in paragraph (b) of this Section 2.01, the Depositor shall be deemed thereby to
represent and warrant to the Trustee and the Securities Intermediary that:
(i) the Depositor is duly authorized to so deliver the Underlying
Securities;
(ii) the Underlying Securities so delivered are genuine;
(iii) 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
(iv) such delivery is irrevocable and free of any continuing claim
by the Depositor except such as the Depositor may have as a
Certificateholder.
The above representations and warranties shall survive the delivery of
the Underlying Securities and the Certificates in respect thereof. The Depositor
shall further be deemed by such delivery to have made the representations that
to the Depositor's knowledge but without having made any independent inquiry, as
of the Closing Date, no default or event of default with respect to the
Underlying Securities has occurred and is continuing.
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(d) Unless otherwise specified in the related Supplement, the Grant of
the Deposited Assets accomplished by this Trust Agreement is absolute and shall
constitute a sale. In addition, the Trust created hereunder and thereunder shall
constitute a fixed investment trust for federal income tax purposes under
Treasury Regulation Section 301.7701-4, and all parties hereto and thereto agree
to treat the Trust, any distributions therefrom and the beneficial interest in
the Certificates consistently with such characterization. The provisions of this
Trust Agreement shall be interpreted consistently with such characterization.
(e) 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.
(f) Anything herein to the contrary notwithstanding, none of the
Trustee, the Securities Intermediary or any of the Certificateholders assumes
any of the obligations of the Depositor or any other Person in respect of the
Underlying Securities.
(g) The Securities Intermediary expressly agrees with the Trustee and
the Certificateholders that, at all times from and after the date hereof, any
and all of the Deposited Assets held by the Securities Intermediary in the
Certificate Account are to be treated as Financial Assets under, and for all
purposes of, UCC Article 8 and UCC Article 9.
Section 2.02. Acceptance by Trustee. With respect to each Series, the
Trustee will acknowledge receipt by it, or by a custodian on its behalf, of the
related Underlying Securities now existing or hereafter acquired, and declares
that it will hold such Underlying Securities and all other documents delivered
to it pursuant to this Trust Agreement, and that it will hold all such assets
and such other assets (including Underlying Securities acquired from a Person
other than the Depositor) comprising the Trust for a given Series, in trust for
the exclusive use and benefit of all present and future Certificateholders of
such Series and for the purposes and subject to the terms and conditions set
forth in this Trust Agreement.
Section 2.03. Representations and Warranties of the Depositor. The
Depositor hereby represents and warrants to the Trustee that as of the Closing
Date or as of such other date specifically provided herein or in the applicable
Supplement:
(i) the Depositor is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware;
(ii) with respect to each Supplement, to the Depositor's knowledge
but without having made any independent inquiry, the information set
forth in the Underlying Securities Schedule with respect to each
Underlying Security is true and correct in all material respects at the
date or dates, respecting which, such information is furnished;
(iii) the execution and delivery of this Trust Agreement by the
Depositor and its performance of and compliance with the terms of this
Trust Agreement will not violate the Depositor's certificate of
incorporation or by-laws or constitute a default (or an event which,
with notice or lapse of time, or both, would constitute a default)
under, or result in the breach or acceleration of, any material
contract, agreement or other instrument to which the Depositor is a
party or which may be applicable to the Depositor or any of its assets;
(iv) the Depositor has the full power and authority to enter into
and consummate all transactions contemplated by this Trust Agreement,
has duly authorized the execution, delivery and performance of this
Trust Agreement and has duly executed and delivered this Trust
Agreement. This Trust Agreement, upon its execution and delivery by the
Depositor and assuming due authorization, execution and delivery by the
Trustee, will constitute a valid, legal and binding obligation of the
Depositor, enforceable against it in accordance with the terms hereof,
except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, receivership, moratorium or other laws relating to or
affecting the rights of creditors generally,
15
and by general equity principles (regardless of whether such
enforcement is considered a Proceeding in equity or at law); and
(v) any additional representations and warranties, if any, that
may be specified in the applicable Supplement.
It is understood and agreed that the representations and warranties of
the Depositor set forth in this Section 2.03 shall survive delivery of the
respective documents and the Underlying Securities to the Trustee and shall
inure to the benefit of the Trustee on behalf of the Certificateholders
notwithstanding any restrictive or qualified endorsement or assignment. Upon
discovery by any of the Depositor or the Trustee of a breach of any of the
foregoing representations and warranties which materially and adversely affects
the interests of the Certificateholders, the party discovering such breach shall
give prompt written notice thereof to the other party.
Section 2.04. Breach of Representation, Warranty or Covenant. Within 90
days of the earlier of discovery by the Depositor or receipt of notice by the
Depositor of a breach of any representation or warranty of the Depositor set
forth in Section 2.03 that materially and adversely affects the interests of the
Certificateholders of a given Series, the Depositor shall cure such breach in
all material respects.
Section 2.05. Agreement to Execute, Authenticate and Deliver
Certificates. With respect to each Series and the related Trust, the Trustee
hereby agrees and acknowledges that it will, concurrently with the Grant to and
receipt by it of the related Underlying Securities, cause to be executed,
authenticated and delivered to or upon the written order of the Depositor, in
exchange for the Underlying Securities and such other assets constituting the
Trust for a given Series, Certificates duly authenticated by or on behalf of the
Trustee in an Authorized Denomination evidencing ownership of the entire Trust
for such Series, all in accordance with the terms and subject to the conditions
of Section 5.02.
Section 2.06. Custody and Holding of Deposited Assets. (a) With respect
to each Series, the Trustee shall hold and maintain the Deposited Assets with
the Securities Intermediary in and through, and hereby directs the Securities
Intermediary to credit any and all such Deposited Assets to, the Certificate
Account (all as further provided in this Article II) in such manner as shall
enable the Trustee to be and have the rights of an Entitlement Holder with
respect to, and have sole dominion and control (including, without limitation,
Securities Control) over, such Deposited Assets.
(b) The Securities Intermediary hereby represents, warrants, covenants
and agrees that from and after the Closing Date:
(i) Each Certificate Account is a Securities Account, with the
Trustee (for its benefit and the benefit of the Certificateholders) as
the Entitlement Holder in, and having sole dominion and control
(including, without limitation, Securities Control) over, any and all
Deposited Assets (including, without limitation, any and all assets and
properties referred to in clause (ii) below) in such Certificate
Account.
(ii) All assets and properties from time to time transferred or
credited to the Certificate Account constitute Financial Assets.
(iii) The Securities Intermediary is (and will remain) a
securities intermediary and is acting (and will continue to act) as
such with respect to the Certificate Account, the Deposited Assets
therein and the Trustee as Entitlement Holder. Unless otherwise
instructed by the Trustee in writing, the Securities Intermediary will
treat the Trustee (for its benefit and the benefit of the
Certificateholders) as entitled to exercise the rights that comprise
the Deposited Assets in each Certificate Account. Further, the
Securities Intermediary is and will remain (A) a bank, banking
institution, financial firm or similar party, in each case, that
regularly accepts in its course of its business Book-Entry Securities
as a custodial service for customers and maintains Securities Accounts
in the name of such customers reflecting ownership of or interest in
such Securities, (B) will maintain its books and records reflecting
such Book-Entry Securities in the State of New York and (C) if the
Trustee maintains one or more Certificate Accounts with the Securities
Intermediary, will have entered into, and will maintain in full force
and effect, an agreement with the Trustee (which, on the date hereof,
is comprised of this Trust Agreement) to the effect that their
respective rights and obligations in
16
respect of each other, said Underlying Securities and said Certificate
Accounts are governed by the laws of the State of New York.
(iv) The Securities Intermediary shall hold any and all assets and
properties from time to time comprising the Deposited Assets (whether
individually or as part of a fungible bulk) in a manner such that the
Trustee will have dominion and control (including, without limitation,
Securities Control) over such Deposited Assets. The Securities
Intermediary will credit to the appropriate Certificate Account (and
will thereby or by book entry or otherwise identify as being subject to
the Grant to the Trustee hereunder) any and all assets and properties
from time to time comprising the Deposited Assets in accordance with
Section 2.06(a) hereof.
(v) To effect the intention of clauses (i) through (iv) above, the
Securities Intermediary or its agent maintains (and will continue to
maintain)
(A) one or more Securities Accounts with the Depository. The
Securities Intermediary or its agent will instruct the Depository
to credit such Securities Accounts of the Securities Intermediary
or its agent with the Depository with the Depository Securities
comprising from time to time the Deposited Assets; and
(B) one or more Fed Member Securities Accounts to which the
Securities Intermediary through its agent will instruct the Fed to
credit, in accordance with the Book-Entry Regulations, all
Book-Entry Securities from time to time comprising the Deposited
Assets.
ARTICLE III
ADMINISTRATION OF EACH TRUST
Section 3.01. Administration of Each Trust. (a) The Trustee shall
administer the Underlying Securities for each given Trust for the benefit of the
Certificateholders of the related Series. In engaging in such activities, the
Trustee shall follow or cause to be followed collection procedures in accordance
with the terms of these Standard Terms and the applicable Supplement, the
respective Underlying Securities and any applicable Credit Support Instruments.
With respect to each Trust, and subject only to the above-described standards
and the terms of these Standard Terms, the related Supplement and the respective
Underlying Securities and applicable Credit Support Instruments, if any, the
Trustee shall have full power and authority, acting alone or through
Administrative Agents as provided in Section 7.02, to do or cause to be done any
and all things in connection with such administration which it deems necessary
to comply with the terms of these Standard Terms and the applicable Supplement.
(b) The duties of the Trustee shall be performed in accordance with
applicable local, State and Federal law, and the Trustee shall, at the direction
of the Depositor, make any and all filings, reports, notices or applications
with (as prepared by the Depositor), and seek any comments and authorizations
from, the Commission and any State securities authority on behalf of the Trust
for each Series.
Section 3.02. Collection of Certain Underlying Security Payments. With
respect to any Series or Class, the Trustee shall make reasonable efforts to
collect all payments required to be made pursuant to the terms of the Underlying
Securities in a manner consistent with the terms of this Trust Agreement, such
Underlying Securities and any related Credit Support Instruments, if applicable.
Section 3.03. Certificate Accounts. (a) For each Series, the Trustee
shall establish and maintain one or more Eligible Accounts (collectively, the
"Certificate Accounts"), which shall be Securities Accounts and shall be held in
trust in the name of the Trustee for its benefit and the benefit of
Certificateholders of such Series. The Trustee on behalf of such
Certificateholders shall possess all right, title and interest in all funds on
deposit from time to time in each Certificate Account and in all proceeds
thereof. With respect to each Series and in accordance with Section 2.06, the
Certificate Accounts shall be under the sole dominion and control (including,
without limitation, Securities Control) of the Trustee for the benefit of the
related Certificateholders. With respect to each Series, not later than the
close of business on the Business Day on which the Trustee receives such amounts
in the form of immediately available funds (so long as such funds are received
by the Trustee by 3:00 p.m., New York
17
City time, and on the next Business Day otherwise), the Trustee shall deposit or
cause to be deposited in the Certificate Accounts all amounts received by it
with respect to the Deposited Assets, any Credit Support and all Liquidation
Proceeds related to such Series including:
(i) all payments on account of principal of such Underlying
Securities;
(ii) all payments on account of interest on such Underlying
Securities;
(iii) all payments on account of premium (if any) on such
Underlying Securities;
(iv) any payments in respect of any such Credit Support;
(v) any Advances made as required pursuant to Section 4.04; and
(vi) any interest or investment income earned on funds deposited
in the related Accounts.
Unless otherwise specified in the applicable Supplement, it is
understood and agreed that payments in the nature of prepayment or redemption
penalties, late payment charges, default interest or reinvestment income which
may be received by the Trustee shall be deposited by the Trustee in the
Certificate Account and shall not be retained by the Trustee for its own
account.
If, at any time, the Certificate Account for any Series ceases to be an
Eligible Account, the Trustee shall within five Business Days (or such longer
period, not to exceed 30 calendar days, as to which the Rating Agency Condition
is met) establish a new Certificate Account meeting the conditions specified
above and the Trustee shall within five Business Days transfer any cash and any
investments on deposit in the Certificate Account to such new Certificate
Account, and from the date such new Certificate Account is established, it shall
be the Certificate Account for such Series.
(b) The Trustee shall give notice to the Depositor of the location of
each Eligible Account constituting the Certificate Account and prior to any
change thereof, if such Eligible Account is or will be located at an institution
other than United States Trust Company of New York.
Section 3.04. Distribution or Sale of the Underlying Securities. If (a)
there occurs a payment default on the Underlying Securities, (b) there occurs an
acceleration of the date of maturity of the Underlying Securities, or (c) the
Underlying Securities Issuer of any Concentrated Underlying Securities ceases to
be a reporting company under the Exchange Act, then the Trustee, upon receiving
notice of the events set forth in (a), (b) or (c) shall exercise one of the
following remedies, in accordance with the Distribution Election:
(i) immediately direct the Market Agent to sell the Underlying
Securities and a pro rata portion of the Related Assets held by such
Trust, in accordance with the Sale Procedures, and the Liquidation
Proceeds, if any, shall be deposited into the Certificate Account for
distribution in accordance with the Allocation Ratio on the first
Business Day following such deposit into the Certificate Account;
(ii) distribute the Underlying Securities and a pro rata portion
of the Related Assets in accordance with the Allocation Ratio to each
Holder's last address as it appears in the Certificate Register within
three Business Days of receiving the notice referred to in the first
sentence of this Section 3.04; or
(iii) provide that the Holders of a given Series or Class may vote
in favor of either (i) or (ii), in accordance with the procedures set
forth in the applicable Supplement.
In the case of a sale by the Market Agent of Underlying Securities and
Related Assets pursuant to clause (i) of this Section 3.04, the Trustee shall
deliver such Underlying Securities and 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.
18
Section 3.05. Investment of Funds in the Accounts. The Trustee may
direct any depository institution maintaining the Certificate Account or the
Reserve Account, if any, for the Series and any other segregated Eligible
Account, which Eligible Account shall be a Securities Account the contents of
which are held for the benefit of Certificateholders of such applicable Series
(each, an "Account"), to invest the funds therein at the specific written
direction of the Depositor in one or more Eligible Investments bearing interest
or sold at a discount, which shall be held to maturity unless payable on demand
and which funds shall not be reinvested upon the maturity or demand for payment
of such Eligible Investment. If the Depositor does not provide any investment
directions by 10:00 a.m. on any Business Day, funds held in any Account will be
invested in the Eligible Investments specified in clause (iv) of the definition
thereof until receipt of investment directions to the contrary. Investments of
such funds shall be invested in Eligible Investments that will mature so that
such funds will be available for distribution on the next Distribution Date.
Except as otherwise provided in the applicable Supplement, any earnings with
respect to such Eligible Investments shall be paid to, and any losses with
respect to such Eligible Investments shall be solely for the account of, the
Certificateholders in proportion to their interest in the invested funds. In the
event amounts on deposit in an Account are at any time invested in an Eligible
Investment payable on demand, the Securities Intermediary, on behalf of the
Trustee and the Trust, shall:
(i) consistent with any notice required to be given thereunder,
demand that payment thereon be made on the last day such Eligible
Investment may otherwise mature hereunder in an amount equal to the
lesser of (1) all amounts then payable thereunder and (2) the amount
required to be withdrawn on such date; and
(ii) demand same day payment of all amounts due thereunder upon a
determination by the Trustee that such Eligible Investment would not
constitute an Eligible Investment in respect of funds thereafter on
deposit in any Account.
None of the Trustee, the Depositor or the Securities Intermediary shall in any
way be held liable by reason of any insufficiency in any Account resulting from
any loss on any Eligible Investment made in accordance with this Trust
Agreement.
Section 3.06. Maintenance of Credit Support. (a) On the applicable
Closing Date, the Trustee at the written direction of the Depositor or, if so
specified in the applicable Supplement, the Depositor shall, to the extent
specified in the applicable Supplement, establish and maintain, or enter into,
as applicable, in the name of the Trustee, either as part of the related Trust
or outside it, for the benefit of the Certificateholders of the related Series,
the Credit Support specified in the applicable Supplement. To the extent
specified in the applicable Supplement, the Depositor will make or cause to be
made any initial deposit to the Certificate Account or any Reserve Account
(which shall be an Eligible Account) for the related Series as of the Closing
Date. Unless the Supplement for a given Series provides otherwise, if a Reserve
Account exists for such Series, collections with respect to the Underlying
Securities for such Series not distributed to the Certificateholders of such
Series shall be deposited in the Reserve Account. The Reserve Account, if any,
shall be an asset of the Depositor (and the income earned on any amounts held in
the Reserve Account shall be allocable to the Depositor, who agrees to include
any such income in its gross income for all federal, state and local income and
franchise tax purposes) and will not be a part of or otherwise be included in
the Trust but will be held for the benefit of the Certificateholders.
(b) Amounts on deposit in the Reserve Account and amounts available
pursuant to any other Credit Support for such Series shall be applied by the
Trustee to make distributions of principal of and premium (if any) and interest
on the Certificates of such Series as required pursuant to Section 4.01 and the
applicable Supplement to the extent that funds are not otherwise available for
such purpose. If specified in such Supplement, immediately after each
Distribution Date, amounts on deposit in the Reserve Account for such Series in
excess of a specified amount shall be paid to the Person so specified in such
Supplement.
Section 3.07. Realization upon Defaulted Underlying Securities. (a) The
Trustee on behalf of the Certificateholders, shall assert claims under each
applicable Credit Support Instrument, and shall take such reasonable steps as
are necessary to receive payment or to permit recovery thereunder with respect
to any defaulted Underlying Securities, subject in all cases to the provisions
of Article VII hereof.
(b) Unless otherwise provided in the related Supplement, if the Trustee
is unable to obtain full recovery in respect of a defaulted Underlying Security
and any
19
related Credit Support Instrument pursuant to Section 3.07(a), the Trustee shall
follow or cause to be followed such normal practices and procedures as it deems
necessary or advisable to realize upon such defaulted Underlying Security and
such Credit Support Instrument, subject in all cases to the provisions of
Article VII hereof.
(c) If the Liquidation Proceeds of a defaulted Underlying Security are
less than the sum of (i) the outstanding principal balance of the defaulted
Underlying Security and (ii) the aggregate amount of expenses incurred by the
Trustee in connection with the practices and procedures referred to in paragraph
(b) of this Section 3.07 to the extent reimbursable under these Standard Terms
and the related Supplement, the Trust for the applicable Series shall recognize
a Realized Loss equal to the amount of such difference. Any such Realized Loss
shall be allocated in accordance with Section 4.05.
Section 3.08. Retained Interest. The Retained Interest, if any, in any
Underlying Security shall initially be held by the Person so specified in the
related Supplement as and to the extent specified therein.
Section 3.09. Access to Certain Documentation. The Trustee shall
provide to any Federal, State or local regulatory authority that may exercise
authority over any Certificateholder access to the documentation in the
Trustee's possession regarding the Underlying Securities required by applicable
laws and regulations. Such access shall be afforded without charge, but only
upon reasonable written request and during normal business hours at the offices
of the Trustee designated by it. In addition, access to the documentation in the
Trustee's possession regarding the Underlying Securities related to a given
Series (or Class within such Series) will be provided to any Certificateholder
of such Series (or Class) upon reasonable written request during normal business
hours at the offices of the Trustee designated by it at the expense of the
Certificateholder requesting such access.
Section 3.10. Reports by the Depositor. The Depositor shall:
(i) file with the Trustee, within 30 days after the Depositor is
required to file the same with the Commission, copies of the annual
reports and of the information, documents and other reports (or copies
of such portions of any of the foregoing as the Commission may from
time to time by rules and regulations prescribe) which the Depositor is
required to file with the Commission pursuant to Section 13 or Section
15(d) of the Exchange Act; or, if the Depositor is not required to file
information, documents or reports pursuant to either of such Sections,
then to file with the Trustee and the Commission, in accordance with
rules and regulations prescribed by the Commission, such of the
supplementary and periodic information, documents and reports which may
be required pursuant to Section 13 of the Exchange Act in respect of a
security listed and registered on a national securities exchange as may
be prescribed in such rules and regulations;
(ii) file with the Trustee and the Commission, in accordance with
the rules and regulations prescribed by the Commission, such additional
information, documents and reports with respect to compliance by the
Depositor with the conditions and covenants provided for in this Trust
Agreement, as may be required by such rules and regulations,
certificates or opinions of independent accountants, conforming to the
requirements of TIA Section 314(e);
(iii) supply to the Trustee (and the Trustee shall transmit to all
Certificateholders, in the manner and to the extent provided in TIA
Section 313(c)), such summaries of any information, documents and
reports required to be filed by the Depositor pursuant to clauses (i)
and (ii) of this Section 3.10 as may be required by rules and
regulations prescribed by the Commission; and
(iv) furnish to the Trustee, not less often than annually, a
certificate from the principal executive, financial or accounting
officer of the Depositor as to his or her knowledge of the Depositor's
compliance with all conditions and covenants under this Trust
Agreement. For purposes of this clause (iv), such compliance shall be
determined without regard to any period of grace or requirement of
notice provided under this Trust Agreement.
Any reports, statements, documents or other information required to be furnished
by the Depositor to the Trustee pursuant to these Standard Terms or any
Supplement shall be deemed to have been delivered to the Trustee if the Trustee
is in possession of such reports, statements, documents or other information at
the time they are to be furnished pursuant to these Standard Terms or any
Supplement.
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Section 3.11. Charges and Expenses. Except as otherwise provided in
these Standard Terms or the related Supplement, no amounts in the nature of fees
or charges shall be payable by or withheld from the Trust, the Depositor or any
other person and there shall be no recourse or claim against the Trust or the
property of the Trust for all or any part of any fees or charges payable to any
person.
ARTICLE IV
DISTRIBUTIONS AND REPORTS TO CERTIFICATEHOLDERS
Section 4.01. Distributions. (a) On each Distribution Date for a given
Series, the Trustee shall apply Available Funds in the Certificate Account for
such Series in the manner and priority set forth in the Supplement for such
Series. In any event, however, any amounts collected during any period shall be
distributed to the Holders no later than the Distribution Date immediately
following the receipt thereof.
(b) All distributions to Holders shall be payable only from Available
Funds, and no provision of this Trust Agreement shall be deemed to create any
obligation on the part of the Trustee or the Depositor to make any distribution
from any other source.
Section 4.02. Distributions on Certificates. (a) Distributions on any
Certificate that are payable and are punctually paid or duly provided for on any
Distribution Date shall be distributed to the Person in whose name such
Certificate (or one or more Predecessor Certificates) is registered at the close
of business on the related Record Date notwithstanding the cancellation of such
Certificate upon any transfer or exchange subsequent to such related Record
Date.
The distribution of interest and principal on Certificates shall be
made:
(i) if the Certificateholder is a Depository, to the Depository,
which shall credit the relevant Participant's account at such
Depository in accordance with the policies and procedure of the
Depository; or
(ii) if the Holder is not a Depository, at the Corporate Trust
Office (except as otherwise specified pursuant to the applicable
Supplement) or, at the option of the Trustee, by check mailed to the
address of the Person entitled thereto as such address shall appear in
the Certificate Register or, if provided pursuant to the applicable
Supplement and in accordance with arrangements satisfactory to the
Trustee, at the option of the registered Holder by wire transfer to an
account designated by the registered Holder. Notwithstanding clause (i)
of this paragraph (a), with respect to a Holder of Certificates not
held in a Depository and having at least the Minimum Wire Denomination,
such payment shall be made by wire transfer of immediately available
funds to the account designated by such Holder in a written request
received by the Trustee not later than 10 days prior to such
Distribution Date; provided, however, that if a wire transfer cannot be
made for any reason, payment shall be made by check. The Trustee shall
not be required to send federal funds wires until any corresponding
payments which were not same day funds when received by it have become
same day funds.
(b) Each Certificate delivered under this Trust Agreement upon transfer
of or in exchange for or in lieu of any other Certificate shall carry the rights
to interest accrued and undistributed, and to accrue, that were carried by such
other Certificate.
(c) All computations of interest due with respect to any Certificate of
any Series or Class within such Series shall be made as specified in the
Supplement applicable to that particular Series or Class.
(d) With respect to any computations or calculations to be made under
these Standard Terms, the applicable Supplement and the Certificates, except as
otherwise provided, all percentages resulting from any calculation of accrued
interest will be rounded, if necessary, to the nearest 1/100,000 of 1%
(.0000001), with five one-millionths of a percentage point rounded upward.
(e) The final distribution of principal and/or premium shall be made
upon presentation and surrender of such Certificates at the Corporate Trust
Office.
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Section 4.03. Reports to Certificateholders. On the fifth Business Day
following each such Distribution Date the Trustee shall forward or cause to be
forwarded to the Depositor, each Holder of such Series, to each Rating Agency
rating such Series and such other Persons as may be specified in such
Supplement, a statement setting forth:
(i) the amounts received by the Trustee as of the last such
statement in respect of principal, interest and premium on the
Underlying Securities, the Swap Receipt Amount, if any, and any other
derivatives transaction that may be entered into by the Trust pursuant
to the terms of these Standard Terms and the related Supplement;
(ii) the Swap Distribution Amount, if any, received by the Trustee
as of such Distribution Date and any other amounts payable pursuant to
any other derivatives transaction that may be entered into by the Trust
pursuant to the terms of these Standard Terms and the related
Supplement;
(iii) the amount of compensation received by the Trustee, and any
Administrative Agent, for the period relating to such Distribution
Date, and such other customary and sufficient information as is
reasonably necessary to enable Holders to calculate their federal
income tax liability with respect to the Certificates; provided,
however, the Trustee shall be permitted to seek the advice of counsel
and such other experts as it may deem necessary in its reasonable
judgment in order to determine that information which is reasonably
necessary to provide to the Holders;
(iv) the amount of the distribution on such Distribution Date to
Holders allocable to principal of and premium, if any, and interest on
the Certificates of each such Class and to the Retained Interest, and
the amount of aggregate unpaid interest accrued as of such Distribution
Date;
(v) in the case of each Class of Floating Rate Certificates of
such Series, the respective Floating Pass-Through Rate applicable to
each such Class on such Distribution Date, as calculated in accordance
with the method specified in such Certificates and the related
Supplement;
(vi) if the Supplement provides for Advances, the aggregate amount
of Advances, if any, included in such distribution, and the aggregate
amount of unreimbursed Advances, if any, at the close of business on
such Distribution Date;
(vii) the aggregate stated principal amount and, if applicable,
notional amount of the Underlying Securities related to such Series,
the current interest rate or rates thereon at the close of business on
such Distribution Date, and the current rating assigned to the
Certificates, as provided to the Trustee in writing in an instrument
specifically referring to this Trust Agreement by the applicable rating
agency;
(viii) the aggregate Certificate Principal Balance (or Notional
Amount, if applicable) of each Class of such Series at the close of
business on such Distribution Date, separately identifying any
reduction in such aggregate Certificate Principal Balance (or Notional
Amount) due to the allocation of any Realized Losses on such
Distribution Date or otherwise as may be specified by the Depositor;
(ix) as to any Series (or any Class within such Series) for which
Credit Support has been obtained, the amount or notional amount of
coverage of each element of Credit Support (and rating, if any,
thereof) included therein as of the close of business on such
Distribution Date; and
(x) any other information appropriate for a Series, as specified
in the applicable Supplement.
Within a reasonable period of time after the end of each calendar year,
the Trustee shall furnish to each Person who at any time during each such
calendar year was a Holder a statement containing the information set forth in
clause (iii) above, aggregated for such calendar year during which such person
was a Holder. Such obligation of the Trustee shall be deemed to have been
satisfied to the extent that substantially comparable information shall be
provided by the Trustee pursuant to any requirements of the Code as are from
time to time in effect. The Trustee shall supply to Holders in
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writing at such Xxxxxx's expense who so request all materials received by the
Trustee from the Underlying Securities Issuer.
Section 4.04. Advances. (a) Unless otherwise specified in the
applicable Supplement, the Trustee shall have no obligation to make Advances (as
defined below) with respect to the Underlying Securities or in favor of the
Holders of any Series (or Class within such Series) of Certificates.
(b) However, as and to the extent provided in the Supplement for a
given Series, and subject to the terms of paragraphs (c) and (d) of this Section
4.04, on or prior to each Distribution Date, the Trustee shall advance or cause
to be advanced in immediately available funds for deposit in the Certificate
Account for such Series an advance (each, an "Advance") in an amount equal,
unless otherwise specified in the related Supplement, to the aggregate of
distributions of principal, premium (if any) and interest due on the Underlying
Securities for such Series (or Class) during the related Collection Period, to
the extent remaining unpaid at the time of such Advance. In satisfaction of its
obligation to make such Advances, the Trustee shall make such Advances from its
own funds and may recover Advances from late collections received by the Trustee
on the applicable Underlying Securities, proceeds from any applicable Credit
Support, if any, and Liquidation Proceeds with respect to the Underlying
Securities for such Series or Class, as specified in the related Supplement, as
to which any such Advance was made.
(c) Notwithstanding any provision herein to the contrary, no Advance
shall be required to be made hereunder if the Trustee reasonably believes that
it will be unable to recover such Advance from related late collections, Credit
Support proceeds, if any, or Liquidation Proceeds with respect to the applicable
Underlying Securities. It is further understood and agreed that the Trustee
shall not be obligated to make any Advances in respect of reductions in the
amount of collections on the Underlying Securities due to bankruptcy proceedings
with respect to the Underlying Securities or the obligors thereof.
(d) Notwithstanding any provision herein to the contrary, unless
otherwise provided in the related Supplement for a given Series, any Advances
made in respect of any Underlying Securities related to such Series (or Class
within such Series) that subsequently are deemed by the Trustee to be
nonrecoverable from related late collections, Credit Support proceeds, if any,
or Liquidation Proceeds may be reimbursed to the Trustee through the application
of amounts on deposit in the Certificate Account for such Series allocable to
any of such Underlying Securities prior to the distributions of interest,
premium (if any) and principal with respect to the Certificates of such Series
or Class.
Section 4.05. Allocation of Realized Losses and Trust Expenses. With
respect to any Series, Realized Losses and Extraordinary Trust Expenses, if any,
shall be allocated on any Distribution Date in accordance with the Allocation
Ratio, provided, however, that distributions pursuant to Section 3.04 shall be
completed as the earliest practicable date.
Section 4.06. Compliance with Withholding Requirements. (a)
Notwithstanding any other provision of this Trust Agreement to the contrary, the
Trustee shall comply with all Federal withholding requirements respecting
distributions to Holders of interest or original issue discount that the Trustee
believes are applicable under the Code. The consent of Holders shall not be
required for such withholding.
(b) Each Holder will provide the Trustee (and, so long as the
Certificates are held at a Depository in the form of Global Certificates, each
Beneficial Owner of the Certificates will provide such Depository and the
Trustee) with evidence that there should not be any withholding tax assessed for
Federal income tax purposes in respect of distributions to such Holder, such
evidence to take the form of a statement, on a duly executed and up-to-date
Internal Revenue Service Form W-8 (or successor form), Form W-9 (or successor
form), or Form 4224 (or successor form), as applicable, that identifies the
Beneficial Owner of the Certificate; provided, however, that for so long as the
Certificates are held at a Depository in the form of Global Certificates, the
Holder shall have no obligation to provide the Trustee with any such evidence
except to the extent it has received such evidence from Beneficial Owners of the
Certificates. The Trustee shall not be required to accept any such Internal
Revenue Service forms if it believes that they are not accurate (but the Trustee
shall not be required to make any independent investigation to determine their
accuracy).
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(c) If any tax or other governmental charge shall become payable by or
on behalf of the Trustee, including any tax or governmental charge required to
be withheld from any payment by the Trustee under the provisions of any
applicable law or regulation with respect to any Underlying Securities or the
Certificates, such tax or governmental charge shall be payable by the Holder and
may be withheld by the Trustee. The consent of the Holder shall not be required
for such withholding. In the event the Trustee does withhold any amount from
interest or original issue discount distributions or Advances thereof to any
Holder pursuant to Federal withholding requirements, the Trustee shall indicate
in the statement required pursuant to Section 4.03 the amount so withheld.
(d) The Depositor and the Trustee shall have the right to refuse the
surrender, registration of transfer or exchange of any Certificate with respect
to which such tax or other governmental charge shall be payable until such
payment shall have been made by the Holder thereof.
Section 4.07. Optional Exchange. (a) The terms and conditions, if any,
of an Optional Exchange will be specified in the related Supplement; provided,
however, that any right of Optional Exchange shall be exercisable only to the
extent that the Depositor provides upon the Trustee's request an Opinion of
Counsel that (i) such exchange would not be inconsistent with continued
satisfaction of the applicable requirements for exemption under Rule 3a-7 (or
other applicable rule or exemption) under the Investment Company Act of 1940, as
amended, and all applicable rules, regulations and interpretations thereunder
and (ii) such exchange would not affect the characterization of the Trust as a
"grantor trust" under the Code. The terms of an Optional Exchange may include,
but are not limited to, the following:
(i) a requirement that the exchanging Holder tender to the Trustee
Certificates of each Class within such Series;
(ii) a minimum Certificate Principal Balance or Notional Amount,
as applicable, with respect to Certificates being tendered for exchange
by a single Holder;
(iii) a requirement that the Certificate Principal Balance or
Notional Amount, as applicable, of each Certificate tendered for
exchange be an Authorized Denomination;
(iv) specified dates on which a Holder may effect such an Optional
Exchange (each, an "Optional Exchange Date"), as specified in the
applicable Supplement;
(v) limitations on the right of an exchanging Holder to receive
any benefit upon Optional Exchange from any Credit Support; and
(vi) adjustments to the value of the proceeds of any Optional
Exchange based upon required prepayment of future expense allocations
and the establishment of a reserve for any unanticipated Extraordinary
Trust Expenses.
(b) Unless otherwise provided in the applicable Supplement, no
Certificate may be exchanged pursuant to this Section 4.07 unless the Trustee
has received at least 30 days (or such shorter period acceptable to the Trustee
or specified in the applicable Supplement) but not more than 45 days prior to an
Optional Exchange Date a telegram, telex, facsimile transmission or letter from
a member of a national securities exchange or the National Association of
Securities Dealers, Inc., the Depository (in accordance with its normal
procedures) or a commercial bank or trust company in the United States setting
forth the name of the Holder, the Certificate Principal Balance or Notional
Amount of such Registered Certificate to be exchanged and the number or a
description of the tenor and the terms of such Certificate, a statement that the
Optional Exchange is being exercised thereby and an assurance that the
Registered Certificate to be exchanged with the form entitled "Option to Elect
Exchange" on the reverse of the Registered Certificate duly completed will be
received by such Trustee not later than five Business Days after the date of
such telegram, telex, facsimile transmission or letter, and such Certificate and
form duly completed must be received by such Trustee by such fifth Business Day.
Any tender by the Holder thereof for Optional Exchange shall be irrevocable.
Unless otherwise provided in the applicable Supplement, the Optional Exchange
option may be exercised pursuant to this Section 4.07 by the Holder of a
Certificate for less than the aggregate Certificate Principal Balance or
Notional Amount of such Certificate as long as the Certificate Principal Balance
or Notional Amount remaining Outstanding after such Optional Exchange is an
Authorized Denomination and all other requirements set forth in the related
Supplement are satisfied. Upon such partial
24
exchange, such Certificate shall be cancelled and a new Certificate or
Certificates for the remaining Certificate Principal Balance or Notional Amount
thereof shall be issued (which shall be in the name of the Holder of such
exchanged Certificate).
(c) Upon the completion of any such Optional Exchange, the Trustee
shall give prompt written notice thereof to each Rating Agency.
Section 4.08. Call Right. (a) The holder of a Call Right may purchase
Certificates of a given Series or Class from the Holders thereof prior to
maturity if the applicable Supplement designates such Series or Class as a
Callable Series, or upon the occurrence of a Tax Event or an Optional
Redemption. The Call Terms shall be set forth in the applicable Supplement and
shall include, without limitation, the following:
(i) the initial holder of the Call Right;
(ii) whether the Certificate Principal Balance or Notional Amount
of each Certificate being purchased pursuant to the Call Right must be
an Authorized Denomination;
(iii) the Call Date or Dates; and
(iv) the Call Price.
(b) A Call Right may be exercised at the option of the holder thereof,
in accordance with the Call Terms, upon not less than 35 days' (or such shorter
period acceptable to the Trustee or specified in the applicable Supplement) nor
more than 60 days' prior notice sent via facsimile with transmission confirmed
to the Trustee at the Corporate Trust Office. Such notice to the Trustee shall
include the Certificate Principal Balance (or Notional Amount) of the
Certificates to be purchased and shall reference the Call Price and the Call
Date. On or prior to the second Business Day following receipt of such notice
from the holder of the Call Right, the Trustee shall notify the Holders of the
Certificates by first class mail; such notices shall state:
(i) the Certificate Principal Balance (or Notional Amount) of
Certificates to be purchased;
(ii) the Call Price;
(iii) the name and address of the Paying Agent;
(iv) that Certificates called for purchase must be surrendered to
the Paying Agent in order to collect the Call Price;
(v) that interest on Certificates called for purchase pursuant to
the Call Right ceases to accrue 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
Paying Agent; and
(vi) that, if any Certificate contains a CUSIP, CINS or ISIN
number, no representation is being made as to the correctness of the
CUSIP, CINS or ISIN number either as printed on the Certificates or as
contained in such notice and that reliance may be placed only on the
other identification numbers printed on the Certificates.
(c) If less than all of the Certificates are to be purchased pursuant
to the exercise of the Call Right, the Trustee shall select the Certificates to
be purchased in accordance with the requirements of the principal national
securities exchange on which the Certificates are listed or, if the Certificates
are not listed on a national securities exchange, on a pro rata basis, by lot or
by such other method as such Trustee in its sole discretion shall deem to be
fair and appropriate. The Trustee shall notify the Depositor and the Certificate
Registrar promptly in writing of the Certificates or portions of the
Certificates to be purchased by the holder of the Call Right, provided, however,
that this Section 4.08(c) shall not apply to Certificates subject to a Call
Right due to a Tax Event or an Optional Redemption.
25
(d) 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. Upon surrender of any
Certificates to the Paying Agent, the Holders of such Certificates shall be paid
the Call Price. Notice of purchase shall be deemed to be given when mailed,
whether or not the Holder receives the notice. In any event, failure to give
such notice, or any defect therein, shall not affect the validity of the
proceedings for the purchase of Certificates held by Holders to whom such notice
was properly given.
(e) At or prior to 12:00 noon on the Call Date, the holder of the Call
Right to be exercised shall deposit with the Paying Agent by wire transfer in
same-day funds money sufficient to pay the Call Price of the Certificates to be
redeemed on that date.
(f) If a notice has been given in the manner provided above, the
Certificates or portion of Certificates specified in such notice to be purchased
shall become due and payable on the Call Date at the Call Price stated therein,
together with accrued interest (if applicable) on and after such dates. Upon
surrender of any Certificate in connection with the Call Right, such Certificate
shall be paid and redeemed by the holder of the Call Right at the Call Price.
(g) 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.
(h) Notwithstanding anything to the contrary in these Standard Terms or
any Supplement, a Series or Class will be subject to a Call Right of the
Underlying Securities Issuer if the Underlying Securities Issuer gives notice of
a Tax Event or an Optional Redemption, regardless of whether such Series or
Class is also designated a Callable Series in the applicable Supplement, and in
the case of a Tax Event or an Optional Redemption the required notice of the
Call Right shall be the lesser of the time set forth in Section 4.08(b) and the
time set forth in the notice provisions relating to such Tax Event or Optional
Redemption, respectively, in the Underlying Securities Indenture, as specified
in the related Supplement.
ARTICLE V
THE CERTIFICATES
Section 5.01. The Certificates. (a) The Certificates of any Series (or
Class within such Series) shall be issued in fully registered form without
coupons and shall be substantially in the form of the exhibit attached to the
applicable Supplement.
(b) Each Series (and all Classes within such Series) shall be created
by a Supplement authorized by the Depositor and establishing the terms and
provisions of such Series. Each Trust must be a fixed investment trust under the
Code. Each such Series may be issued in one or more Classes, with such further
particular designation added or incorporated in such title for the Certificates
of any particular Series or Class within such Series as the Depositor may
determine. Each Certificate shall bear upon its face the designation so selected
for the Series and Class to which it belongs. All Certificates of the same
Series and Class shall be identical in all respects except for the denominations
thereof. All Certificates of all Classes within any one Series at any time
Outstanding shall be identical except for differences among the Certificates of
the different Classes within such Series specified in the applicable Supplement.
Except as otherwise provided in the related Supplement, all Certificates of a
particular Series (and all Classes within such Series) issued under this Trust
Agreement shall be in all respects equally and ratably entitled to the benefits
hereof without preference, priority or distinction on account of the actual time
or times of authentication and delivery, all in accordance with the terms and
provisions of this Trust Agreement.
Section 5.02. Execution, Authentication and Delivery. (a) The
Certificates shall be executed by the Trustee by one of its Responsible
Officers, which may be in facsimile form and imprinted or otherwise reproduced
thereon. The signature of any of the Responsible Officers may be manual or
facsimile. Certificates bearing the manual or facsimile signature of individuals
who were at any time the Responsible Officers of the Trustee shall be binding,
notwithstanding that such individuals or any of them have
26
ceased to hold such offices prior to the authentication and delivery of such
Certificates.
(b) Each Certificate shall be dated as of the later of the date
specified in the related Supplement and the date of its authentication.
(c) No Certificate shall be entitled to any benefit under this Trust
Agreement or be valid or obligatory for any purpose, unless there appears on
such Certificate a certificate of authentication substantially in one of the
forms provided for herein executed by the Trustee by the manual signature of one
of its Responsible Officers, and such signature upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder and is entitled to the benefits of this
Trust Agreement.
Section 5.03. Temporary Certificates. Pending the preparation of
Definitive Certificates or permanent Global Securities of any Series (or Class
within each such Series), and upon receipt of a Depositor Order, the Trustee
shall execute, authenticate and deliver temporary Certificates which are
printed, lithographed, typewritten, mimeographed or otherwise produced, in any
Authorized Denomination, substantially of the tenor of the Definitive
Certificates or permanent Global Securities in lieu of which they are issued, in
registered form and with such appropriate insertions, omissions, substitutions
and other variations as may be authorized by such Depositor Order. Any such
temporary Certificate may be in global form, representing all or a portion of
the Outstanding Certificates of such Series or Class. Every such temporary
Certificate shall be executed, authenticated and delivered by the Trustee upon
the same conditions and in substantially the same manner, and with the same
effect, as the Definitive Certificates or permanent Global Securities in lieu of
which is issued.
If temporary Certificates of any Series (or Class within such Series)
are issued, the Trustee will cause Definitive Certificates or Global Securities
of such Series or Class to be prepared without unreasonable delay. After the
preparation of Definitive Certificates of such Series or Class, the temporary
Certificates of such Series or Class shall be exchangeable for Definitive
Certificates or permanent Global Securities of such Series or Class upon
surrender of the temporary Certificates of such Series or Class at the Corporate
Trust Office, without charge to the Holder. Upon surrender for cancellation of
any one or more temporary Certificates of any Series or Class within such
Series, the Trustee, upon receipt of a Depositor Order, shall execute,
authenticate and deliver in exchange therefor Definitive Certificates or
permanent Global Securities with a like Certificate Principal Balance or
Notional Amount, as applicable, of the same Series (or Class within such Series)
of Authorized Denomination and of like tenor. Until so exchanged, temporary
Certificates of any Series (or Class within such Series) shall in all respects
be entitled to the same benefits under this Trust Agreement as Definitive
Certificates or permanent Global Securities of such Series or Class, except as
otherwise specified in the applicable Supplement.
Upon any exchange of a portion of a temporary Global Security for a
permanent definitive Global Security or for the individual Definitive
Certificates represented thereby, the temporary Global Security shall be
endorsed by the Trustee to reflect the reduction of the aggregate Certificate
Principal Balance or Notional Amount, as applicable, evidenced thereby,
whereupon the aggregate Certificate Principal Balance or Notional Amount, as
applicable, of such temporary Global Security shall be reduced for all purposes
by the amount so exchanged and endorsed.
Section 5.04. Registration; Registration of Transfer and Exchange. (a)
The Trustee shall cause to be kept a register for each Series (the registers
maintained in such office and in any other office or agency of the Trustee being
herein sometimes collectively referred to as the "Certificate Register") in
which a transfer agent and registrar (which may be the Trustee) (the
"Certificate Registrar") shall provide for the registration of Certificates and
the registration of transfers and exchanges of Certificates. The Trustee is
hereby initially appointed Certificate Registrar for the purpose of registering
Certificates and transfers and exchanges of Certificates as herein provided;
provided, however, that the Trustee may appoint one or more co-Certificate
Registrars. Upon any resignation of any Certificate Registrar, the Depositor
shall promptly appoint a successor or, in the absence of such appointment,
assume the duties of Certificate Registrar.
If a Person other than the Trustee is appointed by the Depositor as
Certificate Registrar, the Depositor will give the Trustee prompt written notice
of the appointment of a Certificate Registrar and of the location, and any
change in the location, of the
27
Certificate Register, and the Trustee shall have the right to rely upon a
certificate executed on behalf of the Certificate Registrar by an Executive
Officer thereof as to the names and addresses of the Holders and the principal
amounts and numbers of the Certificates held by each Holder.
(b) Upon surrender for registration of transfer any Certificate of any
Series (or Class within such Series) at the office or agency of the Trustee, if
the requirements of Section 8-401(a) of the UCC are met to the Depositor's
satisfaction, the Depositor shall execute, and the Trustee, upon receipt of a
Depositor Order, shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Certificates of any Authorized
Denominations, of a like Series, Class and aggregate Certificate Principal
Balance or Notional Amount, as applicable.
(c) Notwithstanding any other provisions of this Section 5.04, unless
and until it is exchanged in whole or in part for the individual Certificates
represented thereby, a Global Security representing all or a portion of the
Certificates of a Series (or Class within such Series) may not be transferred
except as a whole by the Depository for such Series or Class to a nominee of
such Depository or by a nominee of such Depository to such Depository or another
nominee of such Depository or by such Depository or any such nominee to a
successor Depository for such Series or Class or a nominee of such successor
Depository.
(d) At the option of the Holder, Certificates of any Series (or Class
within such Series) (other than a Global Security, except as set forth below)
may be exchanged for other Certificates of the same Series or Class of any
Authorized Denomination of like tenor and aggregate Certificate Principal
Balance or Notional Amount, as applicable, upon surrender of the Certificates to
be exchanged at the office or agency of the Trustee maintained for such purpose.
(e) All Certificates issued upon any registration of transfer or
exchange of Certificates shall constitute complete and indefeasible evidence of
ownership in the Trust related to such Certificates and be entitled to the same
benefits under this Trust Agreement as the Certificates surrendered upon such
registration of transfer or exchange.
(f) Every Certificate presented or surrendered for registration of
transfer or exchange shall (if so required by the Depositor, the Trustee or the
Certificate Registrar) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Depositor, the Trustee or the
Certificate Registrar, duly executed, by the Holder thereof or his attorney duly
authorized in writing, with such signature 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).
(g) No service charge shall be made to a Holder for any registration of
transfer or exchange of Certificates, 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 registration of transfer or exchange of Certificates,
other than exchanges pursuant to Section 5.03 not involving any transfer.
Section 5.05. Mutilated, Destroyed, Lost and Stolen Certificates. If
(i) any mutilated Certificate is surrendered to the Trustee at its Corporate
Trust Office or (ii) the Depositor and the Trustee receive evidence to their
satisfaction of the destruction, loss or theft of any Certificate, and there is
delivered to the Depositor and the Trustee such security or indemnity as they
may require to hold each of them and any Paying Agent harmless, and neither the
Depositor nor the Trustee receives notice that such Certificate has been
acquired by a bona fide purchaser, then the Depositor shall execute and the
Trustee, upon receipt of a Depositor Order, shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of the same Series or Class of like tenor, form,
terms and principal amount, bearing a number not contemporaneously Outstanding.
Any Certificate executed, authenticated and delivered under this Section 5.05 in
lieu of a lost, destroyed or stolen Certificate (a "Predecessor Certificate")
shall be deemed to evidence the same interest as the Predecessor Certificate.
Upon the issuance of any new Certificate under this Section 5.05, the
Trustee may require the payment of a sum sufficient to cover any tax or other
governmental charge
28
that may be imposed in respect thereto and any other expenses (including the
fees and expenses of the Trustee) connected therewith.
Every new Certificate of any Series or Class issued pursuant to this
Section 5.05 shall constitute complete and indefeasible evidence of ownership in
the Trust related to such Series, whether or not the Predecessor Certificate
shall be at any time enforceable by anyone, and shall be entitled to all the
benefits of this Trust Agreement equally and proportionately with any and all
other Certificates of that Series or Class duly issued hereunder.
The provisions of this Section 5.05 are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of Predecessor Certificates.
Section 5.06. Persons Deemed Owners. (a) The Depositor, the Trustee,
the Securities Intermediary and any agent of the Depositor, the Trustee or the
Securities Intermediary may treat the Person in whose name any Certificate is
registered as the owner of such Certificate for the purpose of receiving
distributions of principal of (and premium, if any) and (subject to Section
4.02) interest, if any, on such Certificate and for all other purposes
whatsoever, whether or not such Certificate be overdue, and neither the
Depositor, the Trustee or the Securities Intermediary, nor any agent of the
Depositor, the Trustee or the Securities Intermediary shall be affected by
notice to the contrary.
(b) None of the Depositor, the Trustee, the Securities Intermediary or
any of their agents will have any responsibility or liability for any aspect of
the records relating to or distributions made by the Depository to Beneficial
Owners of interests in a Global Security or for maintaining, supervising or
reviewing any records relating to such Beneficial Owners.
Section 5.07. Cancellation. Unless otherwise specified pursuant to
Section 5.01 for Certificates of any Series, all Certificates surrendered for
payment, redemption, transfer or exchange shall, if surrendered to any Person
other than the Trustee, be delivered to the Trustee and shall be promptly
cancelled by the Trustee. No Certificates shall be authenticated in lieu of or
in exchange for any Certificates cancelled as provided in this Section 5.07,
except as expressly permitted by this Trust Agreement.
Section 5.08. Global Securities. (a) If the Supplement provides that a
Series (or Class within such Series) of Certificates shall be held by the
Depository in book-entry form, then the Depositor shall execute and, upon
receipt of a Depositor Order, the Trustee shall authenticate and deliver one or
more Global Securities that (i) shall represent an aggregate initial Certificate
Principal Balance or Notional Amount, as applicable, equal to the aggregate
initial Certificate Principal Balance or Notional Amount, as applicable, of the
Certificates of such Series or Class to be represented by such one or more
Global Securities, (ii) shall be registered in the name of the Depository for
such Global Security or Securities or the nominee of such Depository, (iii)
shall be delivered by the Trustee to such Depository or pursuant to such
Depository's instruction and (iv) shall bear a legend substantially to the
following effect:
"UNLESS THIS GLOBAL SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF A NOMINEE OF THE DEPOSITORY (AND
ANY PAYMENT IS MADE TO A NOMINEE OF THE DEPOSITORY), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH
AS THE REGISTERED OWNER HEREOF HAS AN INTEREST HEREIN.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR THE INDIVIDUAL
CERTIFICATES REPRESENTED HEREBY, THIS GLOBAL SECURITY MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A
NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR TO ANOTHER NOMINEE OF THE
DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR
A NOMINEE OF SUCH SUCCESSOR DEPOSITORY."
(b) No Holder of a Certificate of such Series or Class will receive a
Definitive Certificate representing such Holder's interest in such Certificate
or Certificates, except as provided in Section 5.10. Unless and until Definitive
29
Certificates have been issued to Holders of such Series or Class pursuant to
Section 5.10:
(i) the provisions of this Section 5.08 shall be in full force and
effect;
(ii) the Certificate Registrar and the Trustee shall be entitled
to deal with the Depository for all purposes of this Trust Agreement
(including the distribution of principal of, and premium, if any, and
interest on the Certificates and the giving of instructions or
directions hereunder) as the sole Holder of the Certificates of such
Series or Class, and shall have no obligation to the Beneficial Owners
of interests in such Series or Class;
(iii) to the extent that the provisions of this Section 5.08
conflict with any other provisions of this Trust Agreement, the
provisions of this Section 5.08 shall control;
(iv) the rights of Beneficial Owners of such Series or Class shall
be exercised only through the Depository and shall be limited to those
established by law and agreements between such Beneficial Owners and
the Depository or its Participants; and
(v) whenever this Trust Agreement requires or permits actions to
be taken based upon instructions or directions of Holders of a
specified percentage of the aggregate Voting Rights of a Series or
Class, the Depository shall be deemed to represent such percentage only
to the extent that it has received instructions to such effect from
Beneficial Owners of such Series or Class or Participants in such
Depository's system owning or representing, respectively, such required
percentage of the beneficial interest in the Certificates of such
Series or Class and has delivered such instructions to the Trustee.
(c) Each Depository for a Global Security must, at the time of its
designation and at all times while it serves as such Depository, be a Clearing
Agency registered under the Exchange Act and any other applicable statute or
regulation.
Section 5.09. Notices to Depository. Whenever a notice or other
communication to the Holders of a Series or Class within such Series represented
by one or more Global Securities is required under this Trust Agreement, unless
and until Definitive Certificates for such Series or Class shall have been
issued to such Beneficial Owners pursuant to Section 5.10, the Trustee shall
give all such notices and communications specified herein to be given to Holders
of the Certificates of such Series to the Depository, and shall have no
obligation to the Beneficial Owners.
Section 5.10. Definitive Certificates. (a) If in respect of a Series
(or Class within such Series) represented by one or more Global Securities (i)
the Depositor advises the Trustee and the Securities Intermediary in writing
that the Depository is no longer willing or able to properly discharge its
responsibilities with respect to the Certificates of such Series or Class and
the Depositor does not appoint a successor within 90 days or (ii) the Depositor
at its option advises the Trustee and the Securities Intermediary in writing
that it elects to terminate the book-entry system of such Series or Class
through the Depository, then the Depository shall notify all Beneficial Owners
or Participants in the Depository's system with respect to such Series or Class
and the Trustee of the occurrence of any such event and of the availability of
definitive, fully registered Certificates ("Definitive Certificates") for such
Series or Class to Beneficial Owners of such Series or Class requesting the
same.
Upon surrender to the Trustee of the Global Securities of such Series
or Class by the Depository, accompanied by registration instructions, the
Trustee upon receipt of a Depositor Order for the execution, authentication and
delivery of Definitive Certificates of such Series or Class, will execute,
authenticate and deliver Definitive Certificates of such Series or Class in an
aggregate Certificate Principal Balance or Notional Amount, as applicable, equal
to the aggregate Certificate Principal Balance or Notional Amount, as
applicable, of the Global Security or Securities representing Certificates of
such Series or Class in exchange for such Global Security or Securities. None of
the Depositor, the Certificate Registrar, the Trustee or the Securities
Intermediary shall be liable for any delay in delivery of such instructions and
may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the exchange of a Global Security for Definitive
Certificates, such Global Security shall be cancelled by the Trustee. Definitive
Certificates issued in exchange for a Global Security shall be registered in
such names and in such Authorized Denominations as the
30
Depository for such Global Security, pursuant to instructions from its
Participants, any indirect participants or otherwise, shall instruct the
Trustee. The Trustee shall deliver such Certificates to the Person in whose
names such Certificates are so registered. Upon the issuance of Definitive
Certificates of Series or Class, the Trustee shall recognize the holders of the
Definitive Certificates of such Series or Class as Holders.
(b) In addition, if the Depositor so specifies with respect to the
Certificates of a given Series, a Beneficial Owner may, on terms acceptable to
the Depositor and the Depository for such Global Security, receive individual
Definitive Certificates in exchange for such beneficial interest. Upon the
request of such Beneficial Owner, the Trustee upon receipt of a Depositor Order
shall execute, authenticate and deliver, without service charge,
(i) to each such Person specified, a new individual Certificate or
Certificates of the same Series or Class, of any Authorized
Denomination as requested by such Person in an aggregate Certificate
Principal Balance or Notional Amount, as applicable, equal to and in
exchange for such Person's beneficial interest in the Global Security;
and
(ii) to such Depository a new Global Security in an Authorized
Denomination equal to the difference, if any, between the aggregate
Certificate Principal Balance or Notional Amount, as applicable, of the
surrendered Global Security and the aggregate Certificate Principal
Balance or Notional Amount, as applicable, of individual Certificates
delivered to Holders thereof.
In any exchange provided for above, the Trustee, upon receipt of a
Depositor Order, will execute, authenticate and deliver individual Certificates
in registered form in Authorized Denominations.
Section 5.11. Currency of Distributions. (a) Except as otherwise
specified pursuant to the applicable Supplement, distributions of the principal
of (and premium, if any) and interest in respect of Certificates of any Series
or Class will be made in Dollars.
(b) In the case of a Series denominated in a Specified Currency other
than the Dollar, all exchange rate calculations shall be based upon the noon
buying rate in New York City for cable transfers as certified for customs
purposes by the Fed for such Specified Currency. If the Fed does not publish a
noon buying rate for the applicable Specified Currency, the applicable
Supplement will designate the source for calculating the Dollar value of such
Specified Currency.
(c) With respect to any Series, any decision or determination to be
made regarding exchange rates shall be made by an Exchange Rate Agent, provided,
however, that such Exchange Rate Agent shall accept such appointment in writing
and the terms of such appointment shall be acceptable to the Trustee and shall
require such Exchange Rate Agent to make such determination by the method
provided in Section 5.11(b) for the making of such decisions or determination.
All decisions and determinations of such Exchange Rate Agent regarding exchange
rates shall be in its sole discretion and shall, in the absence of manifest
error, be conclusive for all purposes and irrevocably binding upon the
Depositor, the Trustee and all Holders of such Series.
(d) If distributions in respect of a Series must be made in a Specified
Currency other than Dollars and such currency is unavailable due to the
imposition of exchange controls or other circumstances beyond the control of the
Trustee and the Depositor or is no longer used by the government of the country
issuing such Specified Currency or is no longer commonly used for the settlement
of transactions by public institutions of or within the international banking
community, then all distributions in respect of such Series shall be made in
Dollars until such Specified Currency is available.
Section 5.12. Conditions of Execution, Authentication and Delivery of
New Series. (a) Certificates of a new Series may be issued at any time and from
time to time after the execution and delivery of these Standard Terms and the
related Supplement. The Trustee shall execute, authenticate and deliver such
Certificates upon a Depositor Order and upon delivery by the Depositor to the
Trustee of the following:
31
(i) The delivery of the Underlying Securities in accordance with
Section 2.01(b);
(ii) An Opinion of Counsel to the Depositor, addressed to the
Trustee, stating:
1. The Certificates are in the form contemplated by the Trust
Agreement and assuming that the Certificates have been duly
executed, authenticated and delivered by the Trustee in the manner
described in its certificate delivered today, the Certificates are
entitled to the benefits provided in the Trust Agreement and
constitute valid and binding obligations of the Trust, enforceable
against the Trust in accordance with their terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar laws affecting
enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding
in equity or at law), and will be entitled to the benefits of the
Trust Agreement.
2. Execution, authentication and delivery of such
Certificates by the Trustee will not violate the terms of the
Trust Agreement.
3. The execution and delivery of the Trust Agreement will not
contravene the certificate of incorporation or by-laws of the
Company or result in any violation of any of the terms or
provisions of any law or regulation or, to our knowledge of any
indenture, mortgage or other agreement by which the Company is
bound.
4. The Trust Agreement has been duly authorized, executed and
delivered by the Company and (assuming the due authorization,
execution and delivery thereof by the Trustee and the Securities
Intermediary) constitutes a legal, valid and binding obligation of
the Company enforceable against the Company in accordance with its
terms, except as enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or other similar
laws affecting enforcement of creditors' rights generally and
except as enforcement thereof is subject to general principles of
equity (regardless of whether enforcement is considered in a
proceeding in equity or at law).
(iii) An Officer's Certificate of the Depositor, dated as of the
Closing Date, to the effect that all of the requirements of this
Section 5.12 have been satisfied, and that the Depositor is not in
breach of this Trust Agreement and that the execution and delivery of
this Trust Agreement and the Certificates will not result in any breach
of any of the terms, conditions, or provisions of, or constitute a
default under, the Depositor's certificate of incorporation and
by-laws, or any indenture, mortgage, deed of transfer or other
agreement or instrument to which the Depositor is a party or by which
it or its property is bound or any order of any court or administrative
agency entered in any Proceeding to which the Depositor is a party or
by which it or its property may be bound or to which it or its property
may be subject;
(iv) A Supplement consistent with the applicable provisions of
these Standard Terms; (v) All agreements, instruments or other
documents called for by the applicable Supplement as a condition to the
issuance of the Certificates of such Series; (vi) If applicable, a
fully executed copy of any Swap Agreement or other Credit Support
Instrument, together with all documents and opinions required to be
delivered to the Trust upon execution thereof pursuant to the terms
thereof; and (vii) Written instructions by the Depositor to the Trustee
directing the Trustee to enter into and perform any obligations under
any Swap Agreement or other Credit Support Instrument, if applicable,
and/or the Market Agent Agreement, if applicable.
(b) If all the Certificates of a Series are not to be originally issued
at the same time, then the documents required to be delivered pursuant to this
Section 5.12 must be delivered only once, prior to the authentication and
delivery of the first Certificate of such Series; provided, however, that any
subsequent Depositor Order to the Trustee to authenticate Certificates of such
Series upon original issuance shall constitute a representation and warranty by
the Depositor that, as of the date of such request, the statements made in this
Section 5.12 shall be true and correct as if made on such date.
32
Section 5.13. Appointment of Paying Agent. The Trustee may appoint one
or more paying agents (each, a "Paying Agent") with respect to the Certificates
of any Series. Any such Paying Agent shall be authorized to make distributions
to Certificateholders of such Series from the Certificate Account for such
Series pursuant to the provisions of the Supplement and shall report the amounts
of such distributions to the Trustee. Any Paying Agent shall have the revocable
power to withdraw funds from such Certificate Account for the purpose of making
the distributions referred to above. The Trustee may revoke such power and
remove the Paying Agent if the Trustee determines in its sole discretion that
the Paying Agent shall have failed to perform its obligations under this Trust
Agreement in any material respect; provided, however, no Paying Agent may be
removed or replaced until a successor (which successor may be the Trustee) has
been appointed as provided for herein and has accepted the appointment. The
Paying Agent shall initially be the Trustee and any co-paying agent chosen by
the Trustee and acceptable to the Depositor, including, if and so long as any
Series or Class within such Series is listed on the Luxembourg Stock Exchange
and such exchange so requires, a co-paying agent in Luxembourg or another
European city, as specified in the related Supplement. Any Paying Agent shall be
permitted to resign as Paying Agent upon 30 days' notice to the Trustee. In the
event that the Trustee shall no longer be the Paying Agent, the Trustee shall
appoint a successor or additional Paying Agent. The Trustee shall cause each
successor to act as Paying Agent to execute and deliver to Trustee an instrument
in which such successor or additional Paying Agent shall agree with the Trustee
that it will hold all sums, if any, held by it for distribution to the
Certificateholders in trust for the benefit of the Certificateholders entitled
thereto until such sums shall be distributed to such Certificateholders and will
agree to such other matters as are required by TIA Section 317(b). The Paying
Agent shall return all unclaimed funds to the Trustee and upon removal shall
also return all funds in its possession to the Trustee. The provisions of
Sections 7.01, 7.03, 7.04 and 7.06 shall apply to the Trustee also in its role
as Paying Agent, for so long as the Trustee shall act as Paying Agent. Any
reference in this Trust Agreement to the Paying Agent shall include any
co-paying agent unless the context requires otherwise. Notwithstanding anything
contained herein to the contrary, the appointment of a Paying Agent pursuant to
this Section 5.13 shall not release the Trustee from the duties, obligations,
responsibilities or liabilities arising under this Trust Agreement other than
with respect to funds paid to such Paying Agent.
Section 5.14. Authenticating Agent. (a) The Trustee may appoint one or
more Authenticating Agents (each, an "Authenticating Agent") with respect to the
Certificates of any Series which shall be authorized to act on behalf of the
Trustee in authenticating such Certificates in connection with the issuance,
delivery and registration of transfer or exchange of such Certificates. Whenever
reference is made in this Trust Agreement to the authentication of Certificates
by the Trustee or the Trustee's certificate of authentication, such reference
shall be deemed to include authentication on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent must be
acceptable to the Depositor. Notwithstanding anything contained herein to the
contrary, the appointment of an Authenticating Agent pursuant to this Section
5.14 shall not release the Trustee from the duties, obligations,
responsibilities or liabilities arising under this Trust Agreement.
(b) Any institution succeeding to the corporate agency business of any
Authenticating Agent shall continue to be an Authenticating Agent without the
execution or filing of any power or any further act on the part of the Trustee
or such Authenticating Agent. An Authenticating Agent may at any time resign by
giving notice of resignation to the Trustee and to the Depositor. The Trustee
may at any time terminate the agency of an Authenticating Agent by giving notice
of termination to such Authenticating Agent and to the Depositor. Upon receiving
such a notice of resignation or upon such a termination, or in case at any time
an Authenticating Agent shall cease to be acceptable to the Trustee or the
Depositor, the Trustee promptly may appoint a successor Authenticating Agent
which may be the Trustee. Any successor Authenticating Agent upon acceptance of
its appointment hereunder shall become vested with all the rights, powers and
duties of its predecessor hereunder, with like effect as if originally named as
an Authenticating Agent. No successor Authenticating Agent shall be appointed
unless acceptable to the Depositor. The Trustee agrees to pay to each
Authenticating Agent from time to time reasonable compensation for its services
under this Section. The provisions of Sections 7.01, 7.03 and 7.04 shall be
applicable to any Authenticating Agent.
(c) Pursuant to an appointment made under this Section, the
Certificates may have endorsed thereon, in lieu of the Trustee's certificate of
authentication, an alternate certificate of authentication in substantially the
following form:
33
"This is one of the Certificates described in the Standard Terms and
the related Supplement.
Dated: [NAME OF AUTHENTICATING AGENT]
as Authenticating Agent
for the Trustee,
By:_____________________
Authorized Officer"
Section 5.15. Voting Rights with Respect to Underlying Securities. (a)
Within five Business Days after receipt of notice of any meeting of, or other
occasion for the exercise of voting rights or the giving of consents by owners
of any of the Underlying Securities, the Trustee shall give notice to the
Holders, setting forth (i) such information as is contained in such notice to
owners of Underlying Securities, (ii) a statement that Holders will be entitled,
subject to any applicable provision of law and any applicable provisions of such
Underlying Securities to instruct the Trustee as to the exercise of Voting
Rights, if any, pertaining to such Underlying Securities and (iii) a statement
as to the manner in which instructions may be given to the Trustee to give a
discretionary proxy to a person designated in the notice received by the
Trustee. Such notice shall be given by the Trustee to the Holders of record on
such Record Date.
Upon the written request of the applicable Holder, received on or
before the date established by the Trustee for such purpose, the Trustee shall
endeavor, insofar as practicable and permitted under any applicable provision of
law and any applicable provision of or governing the Underlying Securities, to
vote in accordance with any nondiscretionary instruction set forth in such
written request. The Trustee shall not vote except as specifically authorized
and directed in written instructions from the applicable Holder entitled to give
such instructions. Notwithstanding the foregoing, if the Trustee determines
(based solely upon advice furnished by nationally recognized independent tax
counsel, whether at the request of any Holder or otherwise) that the exercise of
voting rights with respect to any Underlying Securities could result in a "sale
or other disposition" of such Underlying Securities within the meaning of
Section 1001(a) of the Code, as amended, the Trustee shall exercise such voting
rights in a manner that would not result in any such sale or other disposition.
The Trustee will have no responsibility to undertake on its own initiative to
determine that any exercise of voting rights will result in any such sale or
other disposition.
(b) By accepting delivery of a Certificate, whether upon original
issuance or subsequent transfer, exchange or replacement thereof, and without
regard to whether ownership is beneficial or otherwise, the Holder agrees so
long as it is an owner thereof that it shall not grant any consent (i) to any
conversion of the timing of payment of, or the method or rate of accruing,
interest on the Underlying Securities underlying the Certificates held by such
Holder or (ii) to any redemption or prepayment of the Underlying Securities
underlying the Certificates held by such Holder. The Trustee shall not grant any
consent solicited from the owners of the Underlying Securities underlying the
Certificates with respect to the matters set forth in this Section nor shall it
accept or take any action in respect of any consent, proxy or instructions
received from any Holder in contravention of the provisions of this Section.
Section 5.16. Actions by Certificateholders. (a) Wherever in this Trust
Agreement a provision is made that an action may be taken or a notice, demand or
instruction given by Certificateholders or Beneficial Owners, such action,
notice or instruction may be taken or given by any Certificateholder or
Beneficial Owner.
(b) Each Certificateholder or Beneficial Owner shall have the right to
assert any rights and privileges of a Certificateholder or Beneficial Owner, and
shall have the right to proceed directly and individually against any Person to
enforce any remedies hereunder and shall not be required to act in concert with
any other Certificateholder or Beneficial Owner or any other Person.
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other act by a Certificateholder or Beneficial Owner of a Certificate
shall bind such Certificateholder or Beneficial Owner and every subsequent
Certificateholder or Beneficial Owner of such Certificate or any Certificate
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof in respect of anything done, suffered or omitted to be done by the
Certificateholder or Beneficial Owner or the
34
Trustee in reliance thereon, whether or not notation of such action is made upon
such Certificate.
(d) Holders are beneficial owners of the right to receive principal
payments and interest payments to which such Certificates relate and, as such,
will have the right following an event of default with respect to any Underlying
Security to proceed directly against the Underlying Securities Issuer(s). Such
Certificateholders are not required to join other Holders of Certificates, the
Depositor, the Trustee or the Securities Intermediary in order to proceed
against the Underlying Securities Issuer(s).
Section 5.17. Events of Default. If any Event of Default shall occur
and be continuing with respect to any Class of Certificates, then, and in each
and every case, the Trustee shall exercise any rights in respect of the related
Underlying Securities as provided in the applicable Supplement.
Section 5.18. Judicial Proceedings Instituted by Trustee; Trustee May
Bring Suit. If there shall be a failure to make payment of the principal of or
premium, if any, or interest on any Underlying Security, then the Trustee, in
its own name, and as trustee of an express trust, as holder of such Underlying
Security, shall be, to the extent permitted by and in accordance with the terms
of the Underlying Security, subject to the limitations on acceleration and the
exercise of remedies set forth therein, and further subject to the provisions of
Sections 7.01(c) and 7.06(f) herein, entitled and empowered to institute
Proceedings at law, in equity or otherwise, including the power to make a demand
on the trustee in respect of such Underlying Security, if provided for, to take
action to enforce the Underlying Security for the collection of the sums so due
and unpaid on such Underlying Security and may prosecute any such Proceeding to
judgment or final decree with respect to the whole amount of any such sums so
due and unpaid.
Section 5.19. Control by Certificateholders. The Holders of
Certificates of any Class holding Certificates representing not less than the
Required Percentage--Direction of Trustee of the aggregate Voting Rights of the
Outstanding Certificates of such Class shall have the right to direct the time,
method and place of conducting any Proceeding for any remedy available to the
Trustee or exercising any trust or power conferred on the Trustee under this
Trust Agreement, including any right of the Trustee as holder of the Underlying
Securities; provided that:
(i) such direction shall not be in conflict with any rule of law
or with this Trust Agreement and would not involve the Trustee in
personal liability or expense;
(ii) the Trustee shall determine, based upon an Opinion of
Counsel, that the action so directed would not be unjustly prejudicial
to the Holders of Certificates of such Class not taking part in such
direction; and
(iii) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
Section 5.20. Waiver of Past Defaults. The Holders of the Required
Percentage--Waiver of Certificates of any Series may (a) waive any past default
under this Trust Agreement and its consequences or (b) direct the Trustee to
vote such percentage of the Underlying Securities held by the Trustee as
corresponds to the percentage of the aggregate Principal Amount of the
Certificates of such Series held by such Holders to waive any past default
thereunder and its consequences with respect to such Series; provided that such
Holders may not waive or direct the Trustee to waive a default
(i) in the payment of the principal of or premium, if any, or
interest on the Underlying Securities; or
(ii) in respect of a covenant or provision hereof that under
Section 11.01 hereof cannot be modified or amended without the consent
of the Holder of each Outstanding Certificate affected.
Upon any waiver of a default under this Trust Agreement or direction that is
effective to waive a default in respect of the Underlying Securities, such
default shall cease to exist with respect to this Trust Agreement, any Event of
Default arising therefrom shall be deemed to have been cured for every purpose
of this Trust Agreement and any direction given by the Trustee on behalf of such
Holders in respect of any Underlying Securities
35
shall be annulled with respect thereto; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.
Section 5.21. Right of Certificateholders to Receive Payments Not to Be
Impaired. Anything in this Trust Agreement to the contrary notwithstanding, the
right of any Certificateholder to receive distributions of payments required
pursuant to Section 4.01 hereof on the Certificates when due, or to institute
suit for enforcement of any such payment on or after the applicable Distribution
Date or other date specified herein for the making of such payment, shall not be
impaired or affected without the consent of such Certificateholder.
Section 5.22. Remedies Cumulative. Every remedy given hereunder to the
Trustee or to any of the Certificateholders shall not be exclusive of any other
remedy or remedies, and every such remedy shall be cumulative and in addition to
every other remedy given hereunder or now or hereafter given by statute, law,
equity or otherwise.
ARTICLE VI
THE DEPOSITOR
Section 6.01. Liability of the Depositor. The Depositor shall be liable
in accordance herewith only to the extent of the obligations specifically
imposed by these Standard Terms and the related Supplement.
Section 6.02. Limitation on Liability of the Depositor. (a) The
Depositor shall not be under any obligation to expend or risk its own funds or
otherwise incur financial liability in the performance of its duties hereunder
or under a Supplement or in the exercise of any of its rights or powers if
reasonable grounds exist for believing that the repayment or such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it.
(b) Neither the Depositor nor any of its directors, officers, employees
or agents shall be under any liability to any Trust or the Certificateholders of
any Series for any action taken, or for refraining from the taking of any
action, in good faith pursuant to this Trust Agreement, or for errors in
judgment; provided, however, that this provision shall not protect the Depositor
against any breach of representations, warranties or covenants made herein, or
against any liability which would otherwise be imposed by reason of willful
misfeasance, bad faith or negligence in the performance of duties or by reason
of reckless disregard of obligations and duties hereunder.
(c) The Depositor shall not be under any obligation to appear in,
prosecute or defend any legal action unless such action is related to its
respective duties under this Trust Agreement and, in its opinion, does not
involve it in any expense or liability; provided, however, that the Depositor
may in its discretion undertake any such action which it may deem necessary or
desirable with respect to this Trust Agreement and the rights and duties of the
parties hereto and the interests of the Certificateholders hereunder. The
Depositor shall be under no obligation whatsoever to appear in, prosecute or
defend any action, suit or other Proceeding in respect of any Underlying
Securities.
(d) The Depositor shall not be liable to any Certificateholder for any
action or non-action by it in reliance upon the advice of or information from
legal counsel, accountants, and a Certificateholder of a Certificate or any
other person believed by it in good faith to be competent to give such advice or
information, including, without limitation, the Market Agent or the other
parties to this Trust Agreement. The Depositor may rely and shall be protected
in acting upon any written notice, request, direction or other document believed
by it to be genuine and to have been signed or presented by the proper party or
parties.
(e) The Depositor shall not incur any liability to any
Certificateholder if, by reason of any provision of any present or future law,
or regulation thereunder, or any governmental authority, or by any reason of any
act of God or war or other circumstance beyond the control of the relevant
party, the Depositor shall be prevented or forbidden from doing or performing
any act or thing which the terms of this Trust Agreement provide shall be done
or performed; and the Depositor shall not incur any liability to any
Certificateholder by reason of any non-performance or delay, caused as
aforesaid, in the performance of any act or thing which the terms of this Trust
Agreement provide shall or may be done or performed, or by reason of any
exercise of, or failure to exercise, any discretion provided for in this Trust
Agreement.
Section 6.03. Depositor May Purchase Certificates. The Depositor may at
any time purchase Certificates in the open market or otherwise. Certificates so
purchased by
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the Depositor may, at the discretion of the Depositor, be held or resold.
Certificates beneficially owned by the Depositor will be disregarded for
purposes of determining whether the required percentage of the aggregate Voting
Rights has given any request, demand, authorization, direction, notice, consent
or waiver hereunder.
Section 6.04. Merger or Consolidation of the Depositor.Nothing in this
Trust Agreement shall prevent any consolidation or merger of the Depositor with
or into any other corporation, or any consolidation or merger of any other
corporation with or into the Depositor or any sale or transfer of all or
substantially all of the property and assets of the Depositor to any other
Person lawfully entitled to acquire the same; provided, however, that, so long
as Certificates are outstanding hereunder, the Depositor covenants and agrees
that any such consolidation, merger, sale or transfer shall be upon the
condition that the due and punctual performance and observance of all the terms,
covenants and conditions of this Trust Agreement to be kept or performed by the
Depositor shall be assumed by the Person (if other than the Depositor) formed by
or resulting from any such consolidation or merger, or which shall have received
the transfer of all or substantially all of the property and assets of the
Depositor, just as fully and effectually as if successor Person had been the
original party of the first part hereto; and in the event of any such sale or
transfer the predecessor Depositor may be dissolved, wound up and liquidated at
any time thereafter.
Section 6.05. No Liability of the Depositor with Respect to the
Underlying Securities; Certificateholders to Proceed Directly Against the
Underlying Securities Issuer(s). (a) The sole obligor with respect to any
Underlying Security is the Underlying Securities Issuer(s). The Depositor shall
not have any obligation on or with respect to the Underlying Securities; and its
obligations with respect to Certificates shall be solely as set forth in this
Trust Agreement.
(b) The Depositor is not authorized to proceed against the Underlying
Securities Issuer in the event of a default or to assert the rights and
privileges of Certificateholders and has no duty in respect thereof.
ARTICLE VII
THE TRUSTEE
Section 7.01. Duties of Trustee. (a) The Trustee undertakes to perform
such duties and only such duties as are specifically set forth in these Standard
Terms and the related Supplement. The Trustee shall exercise in case of receipt
of notice of Default (as such term is defined in paragraph (d) below) such of
the rights and powers vested in it by this Trust Agreement, and shall use the
same degree of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs. In the event that the Underlying Securities Issuer ceases to file
periodic reports under the Exchange Act, the Depositor shall notify the Trustee
of that fact and the Trustee shall take such actions as specifically set forth
in the Supplement. The Trustee shall exercise those rights in a manner
consistent with the status of any Trust created hereunder as a fixed investment
trust for federal income tax purposes as directed by the Depositor. The Trustee
shall not have any power to vary the investment of any Certificateholders of any
Series or to accept any assets (other than proceeds of the Underlying
Securities) other than the Underlying Securities transferred to it on the
Closing Date of any Series. Any permissive right of the Trustee enumerated in
this Trust Agreement shall not be construed as a duty and shall be interpreted
consistently with the status of the Trust as a fixed investment trust.
(b) The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Trust Agreement, shall examine them to determine, in its best
judgment, whether they conform to the requirements of this Trust Agreement. If
any such instrument is found not to conform to the requirements of this Trust
Agreement, the Trustee shall take action as it deems appropriate to have the
instrument corrected, and if the instrument is not corrected to the Trustee's
satisfaction, the Trustee will provide notice thereof to the Depositor and
Certificateholders.
(c) No provision of this Trust Agreement shall be construed to relieve
the Trustee from liability for its own negligent action, its own negligent
failure to act or its own misconduct; provided, however, that:
(i) the duties and obligations of the Trustee shall be determined
solely by the express provisions of this Trust Agreement, the Trustee
shall not be liable except
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for the performance of such duties and obligations as are specifically
set forth in this Trust Agreement, no implied covenants or obligations
shall be read into this Trust Agreement against the Trustee and, in the
absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates or
opinions furnished to the Trustee that conform to the requirements of
this Trust Agreement;
(ii) the Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer or Responsible
Officers of the Trustee, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts;
(iii) the Trustee shall not be personally liable with respect to
any action taken, suffered or omitted to be taken by it in good faith
in accordance with the direction of Holders of the Required
Percentage--Direction of Trustee of the aggregate Voting Rights of a
given Series (or Class or group of Classes within such Series), as
specified in the applicable Supplement relating to the time, method and
place of conducting any Proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee,
under this Trust Agreement;
(iv) the Trustee shall not be required to expend or risk its own
funds or otherwise incur financial liability in the performance of any
of its duties hereunder or in the exercise of any of its rights or
powers if there is reasonable ground for believing that the repayment
of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it;
(v) except for actions expressly authorized by this Trust
Agreement, the Trustee shall take no actions reasonably likely to
impair the interests of the Trust in any Underlying Security now
existing or hereafter acquired or to impair the value of any Underlying
Security now existing or hereafter acquired;
(vi) except as expressly provided in this Trust Agreement, the
Trustee shall have no power to vary the corpus of the Trust including
by (A) accepting any substitute obligation or asset for an Underlying
Security initially assigned to the Trustee under Section 2.01, (B)
adding any other investment, obligation or security to the Trust or (C)
withdrawing from the Trust any Underlying Securities;
(vii) in the event that the Paying Agent or the Certificate
Registrar shall fail to perform any obligation, duty or agreement in
the manner or on the day required to be performed by the Paying Agent
or Certificate Registrar, as the case may be, under this Trust
Agreement, the Trustee shall be obligated promptly upon its knowledge
thereof to perform such obligation, duty or agreement in the manner so
required;
(viii) the Trustee shall not be liable to any Certificateholder
for any action or non-action by it in reliance upon the advice of or
information from legal counsel, accountants, any Certificateholder or
any other person believed by it in good faith to be competent to give
such advice or information, including, without limitation, the Market
Agent or the other parties to this Trust Agreement. The Trustee may
rely and shall be protected in acting upon any written notice,
facsimile transmission, request, direction or other document believed
by it to be genuine and to have been signed or presented by the proper
party or parties;
(ix) the Trustee shall not incur any liability to any
Certificateholder if, by reason of any provision of any present or
future law, or regulation thereunder, or any governmental authority, or
by any reason of any act of God or war or other circumstance beyond the
control of the relevant party, the Trustee shall be prevented or
forbidden from doing or performing any act or thing which the terms of
this Trust Agreement provide shall be done or performed; and the
Trustee shall not incur any liability to any Certificateholder by
reason of any non-performance or delay, caused as aforesaid, in the
performance of any act or thing which the terms of this Trust Agreement
provide shall or may be done or performed, or by reason of any exercise
of, or failure to exercise, any discretion provided for in this Trust
Agreement;
(x) the Trustee shall be under no obligation whatsoever to appear
in, prosecute or defend any Proceeding in respect of any Underlying
Securities;
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(xi) whenever in the administration of this Trust Agreement the
Trustee shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the
Trustee (unless other evidence be herein specifically prescribed) may,
in the absence of bad faith on its part, conclusively rely upon an
Officers' Certificate; and (xii) the Trustee may consult with counsel
of its selection and, the advice of such counsel or any Opinion of
Counsel selected by the Trustee with due care shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in reliance thereon.
(d) As promptly as practicable after, and in any event within 10 days
after, the occurrence of any Default (as such term is defined below) hereunder
with respect to any Class of Certificates, the Trustee shall transmit by mail to
the Depositor and the Holders of Certificates of such Class in accordance with
TIA Section 313(c), notice of such Default hereunder actually known to the
Trustee, unless such Default shall have been cured or waived; provided, however,
that, except in the case of a Default in the payment of the principal of or
premium, if any, or interest on any Underlying Security, the Trustee shall be
protected in withholding such notice if and so long as a trust committee of
Responsible Officers of the Trustee in good faith determines that the
withholding of such notice is in the interests of the Holders of the
Certificates of such Class. For the purpose of this Section 7.01(d), the term
"Default" means, with respect to any Class of Certificates, any event that is,
or after notice or lapse of time or both would become, an Event of Default with
respect to such Class of Certificates.
(e) Within five (5) Business Days after the receipt by the Trustee of a
written application by any three or more Certificateholders stating that such
Certificateholders desire to communicate with other Certificateholders with
respect to their rights under this Trust Agreement or under the Certificates,
and accompanied by a copy of the form of proxy or other communication which such
Certificateholders propose to transmit, and by reasonable proof that each such
Certificateholder has owned its Certificates for a period of at least six (6)
months preceding the date of such application, the Trustee shall, at its
election, either:
(i) afford to such Certificateholders access to all information so
furnished to or received by the Trustee; or
(ii) inform such Certificateholders as to the approximate number
of Certificateholders according to the most recent information so
furnished to or received by the Trustee, and as to the approximate cost
of mailing to such Certificateholders the form of proxy or other
communication, if any, specified in such application.
If the Trustee shall elect not to afford to such Certificateholders access to
such information, the Trustee shall, upon the written request of such
Certificateholders, mail to all such Certificateholders copies of the form of
proxy or other communication which is specified in such request, with reasonable
promptness after a tender to the Trustee of the material to be mailed and of
payment, or provision for the payment, of the reasonable expenses of such
mailing.
(f) The Trustee shall prepare for filing, at the direction of and with
information provided by the Depositor, periodic reports for the Trust pursuant
to the Exchange Act, and the rules and regulations promulgated thereunder on
behalf of the Depositor. The Depositor shall respond reasonably promptly to any
inquiry of the Trustee concerning such reports and shall provide the information
required for such reports within three days of the filing due date.
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Section 7.02. Agreements Between Trustee and Administrative Agents. (a)
The Trustee may enter into Administration Agreements with one or more
Administrative Agents in order to delegate to such Administrative Agents certain
of its administrative obligations with respect to a Series hereunder; provided,
however, that:
(i) such delegation shall not release the Trustee from the duties,
obligations, responsibilities or liabilities arising hereunder;
(ii) the Rating Agency Condition shall have been satisfied with
respect to the entering into of any such agreement;
(iii) such agreement must be consistent with these Standard Terms
and, with respect to Certificates of any Series, the related
Supplement;
(iv) the Trustee will remain solely liable for all fees and
expenses it may owe to such Administrative Agent;
(v) the Administrative Agent shall give representations and
warranties in such Administration Agreement that are the same in
substance as those set forth in Section 7.10 herein (references therein
to the Trust Agreement, the Trustee and the Depositor shall be to the
applicable Administration Agreement, Administrative Agent and Trustee,
respectively, for purposes of this Section 7.02(a)); and
(vi) such Administrative Agent shall meet the eligibility
requirements of a Trustee pursuant to Section 7.07 herein.
An Administration Agreement must provide that an entity serving as
Administrative Agent may resign from its obligations and duties under this Trust
Agreement with respect to any Series only if such resignation, and the
appointment of a successor, would satisfy the Rating Agency Condition or upon a
determination that the duties of the Administrative Agent with respect to such
Series are no longer permissible under applicable law. No such resignation shall
become effective until the Trustee or a successor Administrative Agent has
assumed the obligations of such Administrative Agent with respect to such
Series. In addition, with respect to any Series (or Class within such Series),
each Administration Agreement shall impose on the Administrative Agent
requirements conforming to the provisions set forth in Section 3.01 and provide
for administration of the related Trust and all or certain specified Underlying
Securities for such Series consistent with the terms of this Trust Agreement.
Additional requirements relating to the scope and contents of any Administration
Agreement may be provided in the applicable Supplement. The Trustee shall
deliver to the Depositor copies of all Administration Agreements into which it
enters, and any amendments or modifications thereof, promptly upon the Trustee's
execution and delivery of any such instruments.
(b) Upon the occurrence of an Administrative Agent Termination Event,
the Trustee shall be entitled to terminate the relevant Administration Agreement
and the rights and obligations of any such Administrative Agent under any
Administration Agreement in accordance with the terms and conditions of any such
Administration Agreement. If such Administration Agreement is terminated, the
Trustee shall simultaneously reassume direct responsibility for all obligations
delegated in such Administration Agreement without any act or deed on the part
of the applicable Administrative Agent, and the Trustee shall administer
directly the related Underlying Securities or shall enter into an Administration
Agreement with a successor Administrative Agent which so qualifies under Section
7.02(a). If the Trustee is unwilling or unable to act, it may appoint, or
petition a court of competent jurisdiction for the appointment of, an
Administrative Agent which so qualifies under Section 7.02(a). Pending such
appointment, the Trustee must act in such capacity (except that if the Trustee
is prohibited by law from doing so, then the Trustee will not be so obligated).
(c) If an Administrative Agent is administering one or more Underlying
Securities pursuant to an Administration Agreement, the Administrative Agent
shall deposit into an Eligible Account established by such Administrative Agent
(an "Administration Account") any amounts collected with respect thereto, and
all such amounts shall be distributed to the Trustee for deposit into the
related Certificate Account not later than the Business Day after receipt
thereof.
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Section 7.03. Certain Matters Affecting the Trustee. (a) Except as
otherwise provided in this Article VII:
(i) the Trustee may request and rely upon and shall be protected
in acting or refraining from acting upon any resolution, Officer's
Certificate, certificate of auditors or any other certificate,
statement, instrument, opinion, report, notice, facsimile transmission,
request, consent, order, appraisal, bond or other paper or document
reasonably believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(ii) the Trustee may consult with counsel and any Opinion of
Counsel shall be full and complete authorization and protection in
respect of any action taken or suffered or omitted by it hereunder in
good faith and in accordance with such Opinion of Counsel;
(iii) the Trustee shall be under no obligation to exercise any of
the trusts or powers vested in it by this Trust Agreement or to
institute, conduct or defend any litigation hereunder or in relation
hereto, at the request, order or direction of any of the
Certificateholders, pursuant to the provisions of this Trust Agreement,
unless such Certificateholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby;
(iv) the Trustee shall not be personally liable for any action
taken, suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon
it by this Trust Agreement;
(v) the Trustee shall not be bound to make any investigation into
the facts of matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, facsimile transmission, request,
consent, order, appraisal, approval, bond or other paper or document
believed by it to be genuine, unless requested in writing to do so by
Holders of the Required Percentage--Direction of Trustee of the
aggregate Voting Rights of the affected Series (or Class or Classes
within any such Series), as specified by the applicable Supplement;
provided, however, that if the payment within a reasonable time to the
Trustee of the costs, expenses or liabilities likely to be incurred by
it in the making of such investigation is, in the opinion of the
Trustee, not reasonably assured to the Trustee by the security afforded
to it by the terms of this Trust Agreement, the Trustee may require
reasonable indemnity against such expense or liability as a condition
to taking any such action;
(vi) the Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents
or attorneys or a custodian and shall not be liable for any misconduct
or negligence of any such agents or attorneys selected with due care by
it; and
(vii) the Trustee shall not be personally liable for any loss
resulting from the investment of funds held in any Certificate Account
or Reserve Account in accordance with Section 3.05.
(b) All rights of action under this Trust Agreement or under any of the
Certificates, enforceable by the Trustee, may be enforced by it without the
possession of any of the Certificates of any Series (or Class within such
Series), or the production thereof at the trial or other Proceeding relating
thereto, and any such Proceeding instituted by the Trustee shall be brought in
its name for the benefit of all the Holders of such Certificates, subject to the
provisions of this Trust Agreement.
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Section 7.04. Trustee Not Liable for Recitals in Certificates or
Underlying Securities. The Trustee assumes no responsibility for the correctness
of the recitals contained herein and in the Certificates or in any document
issued in connection with the sale of the Certificates (other than the signature
and authentication on the Certificates). Except as set forth in Section 7.10,
the Trustee makes no representations or warranties as to the validity or
sufficiency of this Trust Agreement or of the Certificates of any Series (other
than the signature and authentication on the Certificates) or of any Underlying
Security or related document. The Trustee shall not be accountable for the use
or application by the Depositor, of any of the Certificates or of the proceeds
of such Certificates.
Section 7.05. Trustee May Own Certificates. The Trustee in its
individual capacity or any other capacity may become the owner or pledgee of
Certificates with the same rights it would have if it were not Trustee;
provided, however, that in determining whether the required percentage of
aggregate Voting Rights shall have consented to any action hereunder requiring
the consent of the Certificateholders, any interest beneficially held by the
Trustee in its individual capacity shall be excluded.
Section 7.06. Trustee's Fees and Expenses. (a) The applicable
Supplement shall specify the amount and circumstances of the Trustee's
compensation and the source thereof.
(b) If the Prepaid Ordinary Expenses set forth in the Supplement is
greater than zero, the Trustee acknowledges that the Depositor has paid to the
Trustee an amount equal to the Prepaid Ordinary Expenses specified therein, and
the Trustee agrees that the payment of such amount shall constitute full and
final satisfaction of and payment for all such expenses.
(c) If the Prepaid Ordinary Expenses set forth in the Supplement is
zero, the Supplement may indicate that Ordinary Expenses will be paid for by the
Trust, in which case the Trustee shall be paid on a periodic basis by the Trust
at the rate or amount and on the terms provided for in the Supplement. In such
cases, the Trustee agrees that its right to receive such payments from the Trust
shall constitute full and final satisfaction of and payment for all Ordinary
Expenses and that the Trustee shall have no claim on payment of Ordinary
Expenses from any other source, including the Depositor.
(d) If the Prepaid Ordinary Expenses set forth in the Supplement is
zero, the Supplement may provide that the Depositor shall pay to the Trustee
from time to time a fee for its services and expenses as Trustee as set forth in
the Supplement payable at the times set forth therein. In such cases, the
Trustee agrees that its right to receive such payments from the Depositor shall
constitute full and final satisfaction of and payment for all Ordinary Expenses
and that the Trustee shall have no claim for payment of Ordinary Expenses from
the Trust. The Trustee further agrees that, notwithstanding any failure by the
Depositor to make such periodic payments of the Ordinary Expenses, the Trustee
shall continue to perform its obligations under this Trust Agreement. The
Depositor's obligations to pay Ordinary Expenses under this Trust Agreement
shall be extinguished and of no further effect upon the payment of Ordinary
Expenses due and owing on the termination of the Trust pursuant to Section 10.01
hereof.
(e) Subject to paragraph (f) of this Section 7.06, all Extraordinary
Trust Expenses, to the extent not paid by a third party are, and shall be,
obligations of the Trust and when due and payable shall be satisfied solely by
the Trust.
(f) The Trustee shall not take any action, including appearing in,
instituting or conducting any action or suit hereunder or in relation hereto
which is not indemnifiable under Section 7.11 hereof which, in the Trustee's
opinion, would or might cause it to incur costs, expenses or liabilities that
are Extraordinary Trust Expenses unless (i) the Trustee is satisfied that it
will have adequate security or indemnity in respect of such costs, expenses and
liabilities, (ii) the Trustee has been instructed to do so by Certificateholders
representing not less than 100% of the aggregate principal amount of
Certificates then outstanding and (iii) such Certificateholders have agreed that
such costs, expenses or liabilities shall be paid by the Trustee from the Trust.
Section 7.07. Eligibility Requirements for Trustee. (a) The Trustee
hereunder shall at all times be a corporation or an association which is not an
Affiliate of the Depositor (but may have normal banking relationships with the
Depositor and its Affiliates) organized and doing business under the laws of any
State or the United States, authorized under such laws to exercise corporate
trust powers which shall be
42
eligible to act as a trustee under TIA Section 310(a), having a combined capital
and surplus of at least $50,000,000, subject to supervision or examination by
Federal or State authority and have a rating from S&P of BBB- or higher. If such
corporation or association publishes reports of conditions at least annually,
pursuant to law or to the requirements of the aforesaid supervising or examining
authority, then for the purposes of this Section 7.07 the combined capital and
surplus of such corporation or association shall be deemed to be its combined
capital and surplus as set forth in its most recent report of conditions so
published. In the event that at any time such Trustee shall cease to be eligible
in accordance with the provisions of this Section 7.07, such Trustee shall
resign immediately in the manner and with the effect specified in Section 7.08.
(b) In determining whether the Trustee has a conflicting interest under
TIA Section 310(b) with respect to any Class of Certificates and this Section
7.07, each other Class of Certificate will be treated as having been issued
under an indenture other than this Trust Agreement.
Section 7.08. Resignation or Removal of the Trustee; Appointment of
Successor Trustee. (a) The Trustee may at any time resign as Trustee hereunder
by written notice of its election so to do, delivered to the Depositor, and such
resignation shall take effect upon the appointment of a successor Trustee and
its acceptance of such appointment as hereinafter provided; provided, however,
that in the event of such resignation, the Trustee shall (i) assist the
Depositor in finding a successor Trustee acceptable to the Depositor and (ii)
negotiate in good faith concerning any prepaid but unaccrued fees.
(b) The Depositor or Holders of the Required Percentage--Removal of
Trustee of Certificates may at any time remove the Trustee as Trustee hereunder
by written notice delivered to the Trustee in the manner provided in Section
11.04 hereof, and such removal shall take effect upon the appointment of the
successor Trustee and its acceptance of such appointment as provided in
paragraph (e) of this Section 7.08; provided, however, that in the event of such
removal, the Depositor shall negotiate in good faith with the Trustee in order
to agree regarding payment of the termination costs of the Trustee resulting
from such removal.
(c) Upon the designation and acceptance thereof of a successor Trustee,
following either resignation or removal of the Trustee, the Trustee shall
deliver to the successor Trustee all records relating to the Certificates in the
form and manner then maintained by the Trustee, which shall include a hard copy
thereof upon written request of the successor Trustee.
(d) If at any time the Trustee shall become incapable of acting or
shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or of
its property shall be appointed, or any public officer shall take charge or
control of the Trustee or of its property of affairs for the purpose of
rehabilitation, conservation or liquidation, the Depositor shall petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee. In the event the Trustee resigns or is
removed, the Trustee shall reimburse the Depositor for any fees or charges
previously paid to the Trustee in respect of duties not yet performed under this
Trust Agreement which remain to be performed by a successor Trustee.
(e) In case at any time the Trustee acting hereunder notifies the
Depositor that it elects to resign or the Depositor or Holders of the Required
Percentage--Removal of Trustee of Certificates notifies or notify the Trustee
that it or they elects or elect to remove the Trustee as Trustee, the Depositor
shall, within sixty (60) days after the delivery of the notice of resignation or
removal, appoint a successor Trustee, which shall satisfy the requirements for a
trustee under Section 7.07. If no successor Trustee has been appointed within
sixty (60) days after the Trustee has given written notice of its election to
resign or the Depositor or Holders of the Required Percentage--Removal of
Trustee of Certificates have given written notice to the Trustee of its or their
election to remove the Trustee, as the case may be, the Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
Every successor Trustee shall execute and deliver to its predecessor and to the
Depositor an instrument in writing accepting its appointment hereunder, and
thereupon such successor Trustee, without any further act or deed, shall become
fully vested with all the rights, powers, duties and obligations of its
predecessor and for all purposes shall be the Trustee under this Trust
Agreement, and such predecessor, upon payment of all sums due it and on the
written request of the Depositor, shall execute and deliver an instrument
transferring to such successor all rights, obligations and powers of such
predecessor hereunder, and shall duly assign, transfer and deliver all right,
title and interest in the Deposited Assets and parts thereof to such successor.
Any successor Trustee shall promptly give
43
notice of its appointment to the Certificateholders of Certificates for which it
is successor Trustee in the manner provided in Section 11.04 hereof.
(f) Any corporation into or with which the Trustee may be merged,
consolidated or converted shall be the successor of such Trustee without the
execution or filing of any document or any further act.
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Section 7.09. Appointment of Office or Agency. As specified in a
Supplement, the Trustee shall appoint an office or agency in The City of New
York where the Certificates may be surrendered for registration of transfer or
exchange, and presented for the final distribution with respect thereto, and
where notices and demands to or upon the Trustee in respect of the Certificates
of the related Series and this Trust Agreement may be served.
Section 7.10. Representations and Warranties of Trustee. The Trustee
represents and warrants that:
(i) the Trustee is duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation or
association;
(ii) neither the execution nor the delivery by the Trustee of this
Trust Agreement, nor the consummation by it of the transactions
contemplated hereby nor compliance by it with any of the terms or
provisions hereof will contravene any Federal or New York law,
governmental rule or regulation governing the banking or trust powers
of the Trustee or any judgment or order binding on it, or violate its
charter documents or by-laws or constitute a default under (or an event
which, without notice or lapse of time or both, would constitute a
default) under, or result in the breach or acceleration of any material
contract, indenture, mortgage, agreement or instrument to which it is a
party or by which any of its properties may be bound;
(iii) the Trustee has full power, authority and right to execute,
deliver and perform its duties and obligations as set forth herein and
in each Supplement to which it is a party and has taken all necessary
action to authorize the execution, delivery and performance by it of
this Trust Agreement;
(iv) this Trust Agreement has been duly executed and delivered by
the Trustee and constitutes, subject to due execution by the Depositor,
the legal, valid and binding obligation of the Trustee, enforceable in
accordance with its terms, except as enforcement may be limited by the
applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the rights of creditors generally and general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law);
(v) the Trustee is not in violation, and the execution and
delivery of the Trust Agreement by the Trustee and its performance and
compliance with the terms thereof will not constitute a violation, of
any order or decree of any court or any order or regulation of any
federal, state, municipal or governmental agency having jurisdiction
over the Trustee or its properties, which violation would reasonably be
expected to have a material adverse effect on the condition (financial
or otherwise) or operations of the Trustee or its properties or on the
performance of its duties hereunder;
(vi) there are no actions or proceedings against, or
investigations of, the Trustee pending, or, to the knowledge of the
Trustee, threatened, before any court, administrative agency or other
tribunal (A) that could reasonably be expected to prohibit its entering
into the Trust Agreement, (B) seeking to prevent the issuance of the
Certificates contemplated by the Trust Agreement or (C) that could
reasonably affect the performance by the Trustee of its obligations
under, or the validity or enforceability against the Trustee of, the
Trust Agreement; and
(vii) no consent, approval, authorization or order of any court,
governmental agency or body is required for the execution, delivery and
performance by the Trustee of, or compliance by the Trustee with, the
Trust Agreement, or for the consummation of the transactions
contemplated by the Trust Agreement, except for such consents,
approvals, authorizations and orders, if any, that have been obtained
prior to the Closing Date.
The representations and warranties of the Trustee set forth in this Section 7.10
shall survive the receipt of Underlying Securities by the Trustee and shall
survive the delivery of the Trust Agreement by the Trustee to the Depositor.
Section 7.11. Indemnification of Trustee by the Depositor;
Contribution. (a) The Depositor agrees, to the extent the Trustee is not
reimbursed pursuant to Section 7.06 hereof, to indemnify the Trustee against,
and hold it harmless from, any loss, expense or liability incurred in connection
with any Proceeding relating to this Trust
45
Agreement or the Certificates or the performance of any of the Trustee's duties
hereunder, other than any loss, liability or expense incurred by reason of
wilful misfeasance, bad faith or negligence in the performance of the Trustee's
duties hereunder or by reason of reckless disregard of the Trustee's obligations
and duties hereunder.
(b) If the indemnification provided for in paragraph (a) of this
Section 7.11 is invalid or unenforceable in accordance with its terms, then the
Depositor shall contribute to the amount paid or payable by the Trustee as a
result of such liability in such proportion as is appropriate to reflect the
relative benefits received by the Depositor on one hand and the Trustee as
Trustee on the other hand. For this purpose (i) the benefits received by the
Depositor shall be the aggregate amount received by it upon the sale of such
Certificates, less the costs and expenses of such sale, including the cost of
acquisition of the Underlying Securities or parts thereof evidenced thereby, and
(ii) the benefits received by the Trustee, as Trustee shall be the aggregate
amount of fees received by it as Trustee, less costs and expenses incurred by it
as Trustee in relation to such Certificates. If, however, the allocation
provided by the immediately preceding two sentences is not permitted by
applicable law, then the Depositor shall contribute to such amount paid or
payable by the Trustee in such proportion as is appropriate to reflect not only
such relative benefits but also the relative fault of the Depositor on the one
hand and the Trustee on the other in connection with the actions or omissions
which resulted in such liability, as well as any other relevant equitable
considerations.
(c) In case any claim shall be made or action brought against the
Trustee for any reason for which indemnity may be sought against the Depositor
as provided above, the Trustee may promptly notify the Depositor in writing
setting forth the particulars of such claim or action and the Depositor may
assume the defense thereof. In the event that the Depositor assumes the defense,
the Trustee shall have the right to retain separate counsel in any such action
but shall bear the fees and expenses of such counsel unless (i) the Depositor
shall have specifically authorized the retaining of such counsel or (ii) the
parties to such suit include the Trustee and the Depositor, and the Trustee has
been advised in writing by such counsel that one or more legal defenses may be
available to it which may not be available to the Depositor, in which case the
Depositor shall not be entitled to assume the defense of such suit
notwithstanding its obligation to bear the reasonable fees and expenses of such
counsel.
(d) The term "Liability", as used in this Section 7.11, shall include
any losses, claims, damages, expenses (including without limitation the
Trustee's reasonable costs, expenses and attorneys' fees and expenses) in
defending itself against any losses, claims or investigations of any nature
whatsoever.
(e) The obligations of the Depositor under this Section 7.11 shall be
in addition to any liability which the Depositor may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of the
Trustee, and to each person, if any, who controls the Trustee within the meaning
of the Exchange Act.
(f) Notwithstanding anything to the contrary contained in this Section
7.11, the Depositor shall not be liable for settlement of any such claim by the
Trustee entered into without the prior written consent of the Depositor, which
consent shall not be unreasonably withheld.
(g) The indemnity provided in this Section 7.11 shall survive the
termination or discharge of this Trust Agreement.
Section 7.12. No Liability of the Trustee with Respect to the
Underlying Securities; Certificateholders to Proceed Directly Against the
Underlying Securities Issuer(s). (a) The sole obligor with respect to any
Underlying Security is the Underlying Securities Issuer(s). The Trustee shall
not have any obligation on or with respect to the Underlying Securities; and its
obligations with respect to Certificates shall be solely as set forth in this
Trust Agreement.
(b) The Trustee is not authorized to proceed against the Underlying
Securities Issuer in the event of a default or to assert the rights and
privileges of Certificateholders of Certificates and has no right or duty in
respect thereof except as expressly provided herein.
Section 7.13. The Depositor to Furnish Trustee with Names and Addresses
of Certificateholders. The Depositor will furnish to the Trustee within 15 days
after each
46
Record Date with respect to any Distribution Date, and at such other times as
the Trustee may request in writing, within 30 days after receipt by the
Depositor of any such request, a list, in such form as the Trustee may
reasonably require, of all information in the possession or control of the
Depositor as to the names and addresses of the Certificateholders, in each case
as of a date not more than 15 days prior to the time such list is furnished;
provided, however, that so long as the Trustee is the sole Registrar, no such
list need be furnished.
Section 7.14. Preservation of Information. The Trustee shall preserve,
in as current a form as is reasonably practicable, the names and addresses of
Certificateholders contained in the most recent list furnished to the Trustee as
provided in Section 7.14, and the names and addresses of Certificateholders
received by the Trustee in its capacity as Registrar, if so acting. The Trustee
may destroy any list furnished to it as provided in Section 7.14, upon receipt
of a new list so furnished.
Section 7.15. Reports by Trustee. If required, within 60 days after May
15 of each year, commencing with the year 1998, the Trustee shall transmit to
the Certificateholders, as provided in TIA Section 313(c), a brief report dated
as of such May 15, if required by TIA Section 313(a).
Section 7.16. Trustee's Application for Instructions from the
Depositor. Any application by the Trustee for written instructions from the
Depositor may, at the option of the Trustee, set forth in writing any action
proposed to be taken or omitted by the Trustee under this Trust Agreement and
the date on and/or after which such action shall be taken or such omission shall
be effective, if, but only if, the obligations of the Trustee with respect to
such proposed action or omission, in the view of the Trustee, are not set forth
reasonably clearly in these Standard Terms and the related Supplement. The
Trustee shall not be liable for any action taken by, or omission of, the Trustee
in accordance with a proposal included in such application on or after the date
specified in such application (which date shall not be less than ten (10)
Business Days after the date a Responsible Officer of the Depositor actually
receives such application, unless any such Responsible Officer shall have
consented in writing to any earlier date) unless, prior to taking any such
action (or the effective date in the case of an omission), the Trustee shall
have received written instructions in response to such application specifying
the action to be taken or omitted; provided, however, that this provision shall
not protect the Trustee from liability for any action or omission constituting
willful misconduct, bad faith or negligence.
ARTICLE VIII
MARKET AGENT
Section 8.01. Market Agent. (a) If specified for a given Series, on the
Closing Date the Trustee shall enter into a Market Agent Agreement with Xxxxxxx
Xxxxx & Co. as the initial Market Agent, in the form attached to the related
Supplement. The Market Agent shall serve as such under the terms and provisions
hereof and of the Market Agent Agreement. The Market Agent, including any
successor appointed pursuant hereto, shall be a member of the National
Association of Securities Dealers, Inc., have capitalization of at least
$25,000,000, and be authorized by law to perform all the duties imposed upon it
by this Trust Agreement and the Market Agent Agreement. The Market Agent may be
removed at any time by the Trustee, acting at the written direction of the
Depositor; provided, however, that such removal shall not take effect until the
appointment of a successor Market Agent. The Market Agent may resign upon 30
days' written notice delivered to the Trustee. The Depositor shall use its best
efforts to appoint a successor Market Agent that is a qualified institution,
effective as of the effectiveness of any such resignation or removal.
ARTICLE IX
SECURITIES INTERMEDIARY
Section 9.01. Resignation or Removal of the Securities Intermediary;
Appointment of Successor Securities Intermediary. (a) The Securities
Intermediary may at any time resign as Securities Intermediary hereunder by
written notice of its election so to do, delivered to the Trustee and the
Depositor, and such resignation shall take effect upon the appointment of a
successor Securities Intermediary and its acceptance of such appointment as
hereinafter provided; provided, however, that in the event of such resignation,
the Securities Intermediary shall (i) assist the Trustee and the Depositor
47
in finding a successor Securities Intermediary acceptable to the Trustee and the
Depositor and (ii) negotiate in good faith concerning any prepaid but unaccrued
fees.
(b) The Trustee, the Depositor or the Holders of the Required
Percentage--Removal of Securities Intermediary of Certificates may at any time
remove the Securities Intermediary as Securities Intermediary hereunder by
written notice delivered to the Securities Intermediary in the manner provided
in Section 11.04 hereof, and such removal shall take effect upon the appointment
of the successor Securities Intermediary and its acceptance of such appointment
as provided in paragraph (e) of this Section 9.01; provided, however, that in
the event of such removal, the Depositor shall negotiate in good faith with the
Securities Intermediary in order to agree regarding payment of the termination
costs of the Securities Intermediary resulting from such removal.
(c) Upon the designation and acceptance thereof of a successor
Securities Intermediary, following either resignation or removal of the
Securities Intermediary, the Securities Intermediary shall deliver to the
successor Securities Intermediary all records relating to the Certificates in
the form and manner then maintained by the Securities Intermediary, which shall
include a hard copy thereof upon written request of the successor Securities
Intermediary.
(d) If at any time the Securities Intermediary shall become incapable
of acting or shall be adjudged a bankrupt or insolvent, or a receiver of the
Securities Intermediary or of its property shall be appointed, or any public
officer shall take charge or control of the Securities Intermediary or of its
property of affairs for the purpose of rehabilitation, conservation or
liquidation, the Depositor shall petition any court of competent jurisdiction
for the removal of the Securities Intermediary and the appointment of a
successor Securities Intermediary. In the event the Securities Intermediary
resigns or is removed, the Securities Intermediary shall reimburse the Depositor
for any fees or charges previously paid to the Securities Intermediary in
respect of duties not yet performed under this Trust Agreement which remain to
be performed by a successor Securities Intermediary.
(e) In case at any time the Securities Intermediary acting hereunder
notifies the Trustee or the Depositor that it elects to resign or the Trustee,
the Depositor or Holders of the Required Percentage--Removal of Securities
Intermediary of Certificates notifies or notify the Securities Intermediary that
it or they elects or elect to remove the Securities Intermediary as Securities
Intermediary, the Depositor shall, within sixty (60) days after the delivery of
the notice of resignation or removal, appoint a successor Securities
Intermediary, which shall satisfy the requirements set forth in Section 2.06. If
no successor Securities Intermediary has been appointed within sixty (60) days
after the Securities Intermediary has given written notice of its election to
resign or the Trustee, the Depositor or Holders of the Required
Percentage--Removal of Securities Intermediary of Certificates have given
written notice to the Securities Intermediary of its or their election to remove
the Securities Intermediary, as the case may be, the Securities Intermediary may
petition any court of competent jurisdiction for the appointment of a successor
Securities Intermediary. Every successor Securities Intermediary shall execute
and deliver to its predecessor, to the Trustee and to the Depositor an
instrument in writing accepting its appointment hereunder, and thereupon such
successor Securities Intermediary, without any further act or deed, shall become
fully vested with all the rights, powers, duties and obligations of its
predecessor and for all purposes shall be the Securities Intermediary under this
Trust Agreement, and such predecessor, upon payment of all sums due it and on
the written request of the Trustee and the Depositor, shall execute and deliver
an instrument transferring to such successor all rights, obligations and powers
of such predecessor hereunder, and shall duly assign, transfer and deliver all
right, title and interest in the Deposited Assets and parts thereof to such
successor. Any successor Securities Intermediary shall promptly give notice of
its appointment to the Certificateholders of Certificates for which it is
successor Securities Intermediary in the manner provided in Section 11.04
hereof.
(f) Any corporation into or with which the Securities Intermediary may
be merged, consolidated or converted shall be the successor of such Securities
Intermediary without the execution or filing of any document or any further act.
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ARTICLE X
TERMINATION
Section 10.01. Termination upon Liquidation of All Underlying
Securities. (a) The respective obligations and responsibilities under this Trust
Agreement of the Depositor and the Trustee (other than the obligations of the
Trustee to make distributions to Holders of the Certificates of any given Series
as hereafter set forth and to provide information reports and information tax
reporting) shall terminate upon the distribution to such Holders of all amounts
held in all the Accounts for such Series and required to be paid to such Holders
pursuant to this Trust Agreement on the Distribution Date coinciding with the
final payment on or other liquidation (which may include redemption or other
purchase thereof by the applicable Underlying Securities Issuer) (or any Advance
with respect thereto) of the last Underlying Security remaining in the Trust for
such Series or the disposition of all property acquired upon liquidation of any
such Underlying Security; provided, however, that in no event shall any trust
created hereby continue beyond the earlier of (1) any date set forth in Section
13 of the applicable Supplement as the termination date for such trust or (2)
the expiration of 21 years from the death of the last survivor of the
descendants of Xxxxxx X. Xxxxxxx, the late ambassador of the United States to
the Court of St. Xxxxx, living on the date hereof.
(b) The Depositor shall provide the Trustee with written notice of any
of the events set forth in paragraph (a) of this Section 10.01.
(c) Upon presentation and surrender of the Certificates by the
Certificateholders on the Final Scheduled Distribution Date, or the Distribution
Date coinciding with or next following the earlier to occur of the occurrences
specified in paragraph (a) of this Section 10.01, with respect to the applicable
Series of Certificates, the Trustee shall distribute to each Holder presenting
and surrendering its Certificates (i) the amount otherwise distributable on such
Distribution Date in accordance with Section 4.01 in respect of the Certificates
so presented and surrendered, or (ii) as specified in the applicable Supplement,
if in connection with the Trustee's sale of all the remaining Underlying
Securities. Any funds not distributed on such Distribution Date shall be set
aside and held in trust for the benefit of Certificateholders not presenting and
surrendering their Certificates in the aforesaid manner, and shall be disposed
of in accordance with this Section 10.01 and Section 4.01 hereof. Immediately
following the deposit of funds in trust hereunder, the Trust for such Series
shall terminate. Subject to applicable escheat laws, the Trustee shall pay to
the Depositor any cash that remains unclaimed, together with interest, if any,
thereon, held by the Trustee on the date two years after such termination.
49
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01. Amendment. (a) Unless otherwise specified in the
applicable Supplement, this Trust Agreement may be amended from time to time by
the Depositor, the Trustee and the Securities Intermediary without notice to or
consent of any of the Certificateholders, for any of the following purposes:
(i) to cure any ambiguity;
(ii) to correct or supplement any provision herein that may be
inconsistent with any other provision herein or in the Supplement;
(iii) to change the Trustee or the Securities Intermediary for a
Series subsequent to the Closing Date for such Series;
(iv) to provide for administration of separate Trusts by more than
one trustee;
(v) to provide for a successor Trustee or successor Securities
Intermediary with respect to Certificates of one or more Series;
(vi) to provide for the issuance of a new Series pursuant to a
Supplement issued hereunder pursuant to Sections 5.01 and 5.12 hereof;
(vii) to add or supplement any Credit Support for the benefit of
any Certificateholders (provided, however, that if any such addition
affects any Series or Class of Certificateholders differently than any
other Series or Class of Certificateholders, then such addition will
not, as evidenced by an Opinion of Counsel, have a material adverse
effect on the interests of any affected Series or Class of
Certificateholders);
(viii) to add to the covenants, restrictions or obligations of the
Depositor, the Trustee, the Securities Intermediary or the
Administrative Agent, if any, for the benefit of the
Certificateholders;
(ix) to comply with any requirements imposed by the Code; or
(x) to add, change or eliminate any other provisions with respect
to matters or questions arising under this Trust Agreement.
Any amendment made pursuant to this paragraph (a) is subject to the
condition that such amendment shall satisfy the Rating Agency Condition with
respect to such amendment and shall not cause any Trust created hereunder to
fail to qualify as a fixed investment trust (or "grantor trust") for federal
income tax purposes.
(b) Without limiting the generality of the foregoing, unless otherwise
specified in the applicable Supplement, with respect to any Series, this Trust
Agreement may also be modified or amended from time to time by the Depositor,
the Trustee and the Securities Intermediary with the consent of the Holders of
Certificates representing the Required Percentage--Amendment of the aggregate
Voting Rights of those Certificates that are adversely affected by such
modification or amendment for the purpose of adding any provision to or changing
in any manner or eliminating any of the provisions of this Trust Agreement or of
modifying in any manner the rights of the Holders of Certificates; provided,
however, that no such amendment shall (i) reduce in any manner the amount of, or
delay the timing of, payments received on Underlying Securities which are
required to be distributed on any Certificate without the consent of the Holders
of such Certificates, (ii) reduce the percentage of aggregate Voting Rights
required to take any action specified in this Trust Agreement, without the
consent of the Holders of all Certificates of such Series or Class then
Outstanding, or (iii) cause any Trust created hereunder to fail to qualify as a
fixed investment trust (or "grantor trust") for federal income tax purposes.
Notwithstanding any other provision of this Trust Agreement, for
purposes of the giving or withholding of consents pursuant to this Section
11.01, Certificates registered in the name of the Depositor, the Trustee, the
Securities Intermediary or any Affiliate of the Depositor, the Trustee or the
Securities Intermediary shall be entitled to Voting
50
Rights with respect to matters affecting such Certificates. Notwithstanding any
other provision of this Trust Agreement, this paragraph (b) shall not be amended
without the unanimous consent of the Holders of all such Certificates.
(c) Promptly after the execution of any such amendment or modification,
the Trustee shall furnish a copy of such amendment or modification to each
Certificateholder of the affected Series or Class and to the Rating Agency. It
shall not be necessary for the consent of Certificateholders under this Section
11.01 to approve the particular form of any proposed amendment, but it shall be
sufficient if such consent shall approve the substance thereof. The manner of
obtaining such consents and of evidencing the authorization of the execution
thereof by Certificateholders shall be subject to such reasonable regulations as
the Trustee may prescribe.
Section 11.02. Limitation on Rights of Certificateholders. (a) The
death or incapacity of any Certificateholder shall not operate to terminate this
Trust Agreement or the Trust, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
Proceeding in any court for a partition or winding up of the applicable Trust,
nor otherwise affect the rights, obligations and liabilities of the parties
hereto or any of them.
(b) No Certificateholder of a given Series shall have any right to vote
(except as expressly provided for herein) or in any manner otherwise control the
operation and management of any Trust, or the obligations of the parties hereto,
nor shall anything herein set forth, or contained in the terms of the
Certificates, be construed so as to constitute the Certificateholders from time
to time as partners or members of an association; nor shall any
Certificateholder be under any liability to any third person by reason of any
action taken by the parties to this Trust Agreement other than pursuant to the
provisions hereof.
(c) No Certificateholder of a given Series shall have any right by
virtue of any provision of this Trust Agreement to institute any Proceeding in
equity or at law upon or under or with respect to this Trust Agreement, unless:
(i) such Holder previously shall have given to the Trustee a
written notice of breach of this Trust Agreement and of the continuance
thereof;
(ii) the Holders of Certificates of such Series evidencing not
less than the Required Percentage--Remedies of the aggregate Voting
Rights of such Series shall have made written request upon the Trustee
to institute such Proceeding in its own name as Trustee hereunder;
(iii) such Certificateholder or Certificateholders shall have
offered to the Trustee such reasonable indemnity as it may require
against the costs, expenses and liabilities to be incurred therein or
thereby;
(iv) the Trustee, for 15 days after its receipt of such notice,
request and offer of indemnity, shall have neglected or refused to
institute any such Proceeding; and
(v) no direction inconsistent with such written request has been
given to the Trustee during such 15-day period by Certificateholders
evidencing not less than the Required Percentage--Remedies of the
aggregate Voting Rights of such Series.
It is understood and agreed that the Trustee shall not be obligated to make any
investigation of matters arising under this Trust Agreement or to institute,
conduct or defend any Proceeding hereunder or in relation hereto at the request,
order or direction of any Certificateholders unless such Certificateholders have
offered to the Trustee the reasonable indemnity referred to above. It is further
understood and agreed, and expressly covenanted by each Certificateholder of
each Series with every other Certificateholder of such Series and the Trustee,
that no one or more Holders of Certificates of such Series shall have any right
in any manner whatever by virtue of any provision of this Trust Agreement to
affect, disturb or prejudice the rights of the Holders of any other of the
Certificates of such Series, or to obtain or seek to obtain priority over or
preference to any other such Holder, or to enforce any right under this Trust
Agreement, except in the manner herein provided and for the equal, ratable and
common benefit of all Certificateholders of such Series. For the protection and
enforcement of the provisions of this Section 11.02, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
51
Section 11.03. Governing Law. This Trust Agreement (including, without
limitation, the establishment and maintenance of Certificate Accounts and all
interests, duties and obligations of the parties hereunder or thereunder or with
respect hereto or thereto) and each Certificate shall be construed in accordance
with and governed by the law of the State of New York.
Section 11.04. Notices. (a) All directions, demands and notices
hereunder shall be in writing and shall be delivered as set forth in the
applicable Supplement.
(b) Any notice required to be provided to a Holder shall be given by
first class mail, postage prepaid, at the last address of such Holder as shown
in the Certificate Register. Any notice so mailed within the time prescribed in
this Trust Agreement shall be conclusively presumed to have been duly given when
mailed, whether or not the Certificateholder receives such notice.
(c) Any and all notices to be given to the Depositor shall be deemed to
have been duly given if sent by facsimile transmission to the Depositor at
Xxxxxxx Xxxxx & Co., World Financial Center, New York, New York 10080,
Attention: Xxxxxxx X. Xxxxxx, facsimile transmission number (000) 000-0000,
telephone confirmation number (000) 000-0000. The Depositor may change this
information by written notice to the Trustee and to the Securities Intermediary.
(d) Any and all notices to be given to the Trustee shall be deemed to
have been duly given if sent by facsimile transmission to the Trustee at he Bank
of New York, 000 Xxxxxxx Xxxxxx, Xxxxx 0X, Xxx Xxxx, XX 00000, Attn: Corporate
Trust Dealing & Trading Group, referencing the designation of the applicable
Series, facsimile transmission number (000) 000-0000, telephone confirmation
number (000) 000-0000. The Trustee may change this information by notice to the
Depositor and to the Securities Intermediary.
(e) Any and all notices to be given to the Securities Intermediary
shall be deemed to have been duly given if sent by facsimile transmission to the
Securities Intermediary at The Bank of New York, 000 Xxxxxxx Xxxxxx, Xxxxx 0X,
Xxx Xxxx, XX 00000, Attn: Corporate Trust Dealing & Trading Group, referencing
the designation of the applicable Series, facsimile transmission number (212)
000-0000, telephone confirmation number (000) 000-0000. The Securities
Intermediary may change this information by notice to the Depositor and to the
Trustee.
(f) Any and all notices to be given to the Swap Counterparty, if any,
will be specified in the Supplement.
Section 11.05. Notice to Rating Agencies. (a) The Trustee shall use its
best efforts promptly to provide notice to each Rating Agency with respect to
each of the following of which it has actual knowledge:
(i) any change or amendment to this Trust Agreement;
(ii) the resignation or termination of the Trustee;
(iii) the final payment to Holders of the Certificates of any
Class;
(iv) any change in the location of the Certificate Account; and
(v) any event that would result in the inability of the Trustee to
make Advances.
(b) In addition, the Trustee shall promptly furnish to each Rating
Agency copies of each report to Certificateholders described in Section 4.03.
(c) Any such notice pursuant to this Section 11.05 shall be in writing
and shall be deemed to have been duly given if personally delivered or mailed by
first class mail, postage prepaid, or by express delivery service to each Rating
Agency at the address specified below or in the applicable Supplement.
(d) (i) Any and all notices to be given to Moody's shall be deemed to
have been duly given if sent by facsimile transmission to Moody's at Xxxxx'x
Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, XX 00000, Attention:
CBO/CLO Monitoring Department, facsimile transmission number (000) 000-0000,
telephone confirmation
52
number (000) 000-0000. Moody's may change this information by notice to
the Depositor and the Trustee.
(ii) Any and all notices to be given to S&P shall be deemed to
have been duly given if sent by facsimile transmission to Standard &
Poor's Ratings Services, 00 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX
00000, Attention: Structured Finance Surveillance Group, facsimile
transmission number (000) 000-0000, telephone confirmation number (212)
438-2482. S&P may change this information by notice to the Depositor
and the Trustee.
(iii) Any and all notices to be given to DCR shall be deemed to
have been duly given in sent by facsimile transmission to DCR at Duff &
Xxxxxx Credit Rating Co., 00 X. Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, XX
00000-0000, Attention: Xxxxx X'Xxxxxxx, facsimile transmission number
(000) 000-0000, telephone confirmation number (312) 368- 3100. DCR may
change this information by notice to the Depositor and the Trustee.
(iv) Any and all notices to be given to Fitch shall be deemed to
have been duly given in sent by facsimile transmission to Fitch at
Fitch Investors Service, L.P., Xxx Xxxxx Xxxxxx Xxxxx, Xxx Xxxx, XX
00000, telephone confirmation number (000) 000-0000. Fitch may change
this information by notice to the Depositor and the Trustee.
Section 11.06. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Trust Agreement shall be for
any reason whatsoever held invalid, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Trust Agreement and shall in no way affect the
validity or enforceability of the other provisions of this Trust Agreement or of
the Certificates or the rights of the Holders thereof.
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 a Series, acquiesce, petition or otherwise invoke or cause a
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 11.08. No Recourse. None of the Trustee (including any
Administrative Agent, Authenticating Agent or Paying Agent), the Securities
Intermediary or the Depositor shall have any recourse to the Underlying
Securities, except as specifically provided in the related Supplement.
Section 11.09. Article and Section References. All Article and Section
references used in these Standard Terms, unless otherwise provided, are to
Articles and Sections in these Standard Terms.
Section 11.10. Counterparts. These Standard Terms may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute one and the
same instrument.
Section 11.11. Trust Indenture Act. This Trust Agreement is subject to
the provisions of the TIA and shall, to the extent applicable, be governed by
such provisions. The Trustee agrees to take all actions within its control to
prevent these Standard Terms, as supplemented by any Supplements, from failing
to qualify under the TIA.
53
IN WITNESS WHEREOF, the Depositor, the Trustee and the Securities
Intermediary have caused these Standard Terms to be duly executed by their
respective officers thereunto duly authorized, in each case as of the day and
year first above written.
XXXXXXX XXXXX DEPOSITOR, INC.,
as Depositor
By: /s/ Xxxxxxx Xxxxxxxxxxxx
------------------------------
Name: Xxxxxxx Xxxxxxxxxxxx
Title: President
THE BANK OF NEW YORK,
as Trustee
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Vice President
THE BANK OF NEW YORK,
as Securities Intermediary
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Vice President
54
EXHIBIT B
Form of Class A Certificate
(begins on next page)
Exhibit B
FORM OF TRUST CERTIFICATE
No. A- $ 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 LTD-1
PPLUS CLASS A 6.7% CALLABLE TRUST CERTIFICATES SERIES LTD-1
-----
$ STATED AMOUNT TRUST CERTIFICATES
---------
($25 STATED AMOUNT PER TRUST CERTIFICATE)
evidencing a fractional undivided beneficial ownership interest in the Trust, as
defined below, the property of which consists principally of $25,000,000
aggregate principal amount of 6.95% Exchange Debentures (the `Underlying
Securities") due 2033 issued by Limited Brands, Inc., 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 LTD-1 formed by the Depositor. Under the Trust Agreement, the Class A
Certificateholders are entitled to receive on each Distribution Date until March
1, 2033 the distributions, if any, received on the Underlying Securities, which
will represent distributions at a rate of 6.7% per annum on the Stated Amount of
the Certificates.
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 Trust Series LTD-1 Supplement,
dated as of April 7, 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 A 6.7% Callable Trust Certificates Series LTD-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.
IN WITNESS WHEREOF, the Trustee has caused this Class A Certificate to
be duly executed as of the date set forth below.
PPLUS TRUST SERIES LTD-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 A Certificates described in the Trust
Agreement referred to herein.
PPLUS TRUST SERIES LTD-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
(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 Certificate-holders 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) March 1, 2033.
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 C
Form of Class B Certificate
(begins on next page)
Exhibit C
FORM OF TRUST CERTIFICATE
No. A- $ 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 LTD-1
PPLUS CLASS B 0.25% CALLABLE TRUST CERTIFICATES SERIES LTD-1
--------
$ STATED AMOUNT TRUST CERTIFICATES
-------
($25 STATED AMOUNT PER TRUST CERTIFICATE)
evidencing a fractional undivided beneficial ownership interest in the Trust, as
defined below, the property of which consists principally of $25,000,000
aggregate principal amount of 6.95% Exchange Debentures (the `Underlying
Securities") due 2033 issued by Limited Brands, Inc., 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 LTD-1 formed by the Depositor. Under the Trust Agreement, the Class B
Certificateholders are entitled to receive on each Distribution Date until March
1, 2033 the distributions, if any, received on the Underlying Securities, which
will represent distributions at a rate of 0.25% per annum on the Stated Amount
of the Certificates.
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 Trust Series LTD-1 Supplement,
dated as of April 7, 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 0.25% Callable Trust Certificates Series LTD-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.
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 LTD-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 LTD-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
(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 Certificate-holders 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) March 1, 2033.
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
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(PLEASE INSERT SOCIAL SECURITY OR TAXPAYER IDENTIFICATION OR OTHER IDENTIFYING
NUMBER OF ASSIGNEE)
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(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
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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
Market Agent Agreement
(begins on next page)
Exhibit D
MARKET AGENT AGREEMENT
MARKET AGENT AGREEMENT, dated as of April 7, 2006 (the "Agreement"), by
and between Xxxxxxx Xxxxx & Co. ("Xxxxxxx Xxxxx & Co.") and the PPLUS Trust
Series LTD-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
2
Affiliate just as fully and effectually as if such Affiliate had been the
original party of the first part to this Agreement.
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
LTD-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.
3
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: /s/ Xxxxxxx X. Xxxxxx
---------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Authorized Signatory
PPLUS TRUST SERIES LTD-1
By: THE BANK OF NEW YORK, solely in its capacity
as Trustee under the Trust Agreement and not in
its individual capacity
By: /s/ Xxxxxxxx Xxxxxxx
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Name: Xxxxxxxx Xxxxxxx
Title: Authorized Signatory
[MARKET AGREEMENT SIGNATURE PAGE]
EXHIBIT E
Form of Escrow Agreement
(begins on next page)
Exhibit E
FORM OF
ESCROW DEPOSIT AGREEMENT
THIS ESCROW DEPOSIT AGREEMENT, dated as of this day of among PPLUS
Trust Series LTD-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 April 5, 2006
(the "Series Supplement," and, together with the Standard Terms, the "Trust
Agreement"), providing for the issuance by the Trust of PPLUS Class A 6.7%
Callable Trust Certificates Series LTD-1 and PPLUS Class B 0.25% Callable Trust
Certificates Series LTD-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 April
5, 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 LTD-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
2
Holder gives such written notice, then the Escrow Agent shall pay the cash
amount in the 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.
3
7. Indemnification of Escrow Agent. The Holder and its successors and
assigns agrees to indemnify and hold Escrow Agent harmless against any and all
losses, claims, 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 LTD-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 LTD-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
4
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 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 LTD-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 LTD-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:
