EXHIBIT 4.1
EXECUTION COPY
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SERIES SUPPLEMENT
CALLABLE TREASURY STRIP TRUST CERTIFICATES
SERIES 1997-USTS-1
between
XXXXXX ABS CORPORATION,
as Depositor
and
THE BANK OF NEW YORK,
as Trustee
CALLABLE TREASURY STRIP TRUST CERTIFICATES
Dated as of September 26, 1997
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TABLE OF CONTENTS
Page
Section 1. Incorporation of Standard Terms...................1
Section 2. Definitions.......................................2
Section 3. Designation of Trust and Certificates.............7
Section 4. Satisfaction of Conditions to Initial Execution
and Delivery of Trust Certificates................8
Section 5. Distributions.....................................8
Section 6. Trustee's Fees....................................8
Section 7. Optional Exchange; Optional Redemption............8
Section 8. Events of Default................................10
Section 9. Miscellaneous....................................10
Section 10. Notices..........................................12
Section 11. Governing Law....................................13
Section 12. Counterparts.....................................13
Section 13. Termination of the Trust.........................13
Section 14. Amendments.......................................13
SCHEDULE I SERIES 1997-USTS-1 UNDERLYING
SECURITIES SCHEDULE
SCHEDULE II DESCRIPTION OF THE CALL RIGHTS
EXHIBIT A STANDARD TERMS FOR TRUST AGREEMENTS
EXHIBIT B FORM OF TRUST CERTIFICATE
i
SERIES SUPPLEMENT
CALLABLE TREASURY STRIP TRUST CERTIFICATES
Series 1997-USTS-1
SERIES SUPPLEMENT, Series 1997-USTS-1, dated as of September
26, 1997 (the "Series Supplement"), by and between XXXXXX ABS CORPORATION, as
Depositor (the "Depositor"), and THE BANK OF NEW YORK, as Trustee (the
"Trustee").
W I T N E S S E T H:
-------------------
WHEREAS, the Depositor desires to create the Trust designated
herein (the "Trust") by executing and delivering this Series Supplement, which
shall incorporate the terms of the Standard Terms for Trust Agreements, dated as
of February 28, 1996 (the "Standard Terms"; together with this Series
Supplement, the "Trust Agreement"), by and between the Depositor and the
Trustee, as modified by this Series Supplement;
WHEREAS, the Depositor desires to deposit the Underlying
Securities set forth on Schedule I attached hereto (the "Underlying Securities
Schedule") 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 trust certificates (the "Certificates") evidencing undivided
interests in the Trust; and
WHEREAS, the Trustee has joined in the execution of the
Standard Terms and this Series Supplement to evidence the acceptance by the
Trustee of the Trust;
NOW, THEREFORE, in consideration of the foregoing premises and
the mutual covenants expressed herein, it is hereby agreed by and between the
Depositor and the Trustee as follows:
Section 1. Incorporation of Standard Terms. Except as
-------------------------------
otherwise provided, 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 Series Supplement and the Standard Terms shall form a
single agreement between the parties. In the event of any inconsistency between
the provisions of this Series Supplement and the provisions of the Standard
Terms, the provisions of this Series
Supplement will control with respect to the transactions described herein.
Section 2. Definitions. (a) Except as otherwise specified
-----------
herein or as the context may otherwise require, the following terms shall have
the respective meanings set forth below for all purposes under this Series
Supplement. (Section 2(b) below sets forth terms listed in the Standard Terms
which are not applicable to this Series.) Capitalized terms used but not defined
herein shall have the meanings assigned to them in the Standard Terms.
"Available Funds" shall have the meaning specified in the
Standard Terms, except that investment income earned on funds invested pursuant
to Section 3.05 of the Standard Terms shall not be included in Available Funds.
"Bonds" shall have the meaning specified in Schedule I
hereto.
"Business Day" shall mean any day other than (i) Saturday or
Sunday or (ii) a day on which banking institutions in New York City, New York
are authorized or obligated by law or executive order to be closed for business
or (iii) a day that is not a business day for the purposes of the Underlying
Securities or the Indenture to the Underlying Securities.
"Call Rights" shall mean the rights to purchase at the
Redemption Price all of the Underlying Securities, and thereby cause an Optional
Redemption of the Certificates on any Redemption Date on or after November 15,
1998 through May 15, 2024, pursuant to the Optional Redemption provisions of
Section 7 hereof.
"Certificates" shall have the meaning specified in
Section 3(a) hereof.
"Closing Date" shall mean September 26, 1997.
"Corporate Trust Office" shall mean the office of The
Bank of New York located at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000.
"Currency" shall mean United States dollars.
"Depository" shall mean the Depository Trust Company.
2
"Distribution Date" shall mean the Scheduled
Distribution Date and each Optional Redemption Date.
"Eligible Account" shall have the meaning specified in
the Standard Terms.
"Eligible Investments" shall be as defined in the Standard
Terms; provided, however, that (i) the minimum required rating for long-term
instruments will be equal to the rating of the Underlying Securities, and (ii)
the rating of any short-term instruments will be A-1+ by S&P and P1 by Moody's.
"Exchange Request" shall have the meaning specified in
Section 7(b) hereof.
"Extraordinary Trust Expenses" shall have the meaning
specified in the Standard Terms.
"Moody's" shall mean Xxxxx'x Investors Service, Inc.
"Optional Exchange" shall mean the exchange of the
Certificates by the Trust pursuant to Section 7 hereof.
"Optional Exchange Date" shall mean May 15 and November
15 of each year.
"Optional Redemption" shall mean the redemption of the
Certificates by the Trust, in whole but not in part, resulting from the exercise
of Call Rights by the Rights Holder or Holders, pursuant to Section 7 hereof.
"Optional Redemption Date" shall mean May 15 and November 15
of each year (or if such date is not a Business Day, the next succeeding
Business Day), occurring on or after November 15, 1998 through May 15, 2024 on
which the Call Rights are exercised.
"Ordinary Expenses" shall mean the Trustee's ordinary expenses
and overhead in connection with its services as Trustee including the items
referred to in the definition of Ordinary Expenses in the Standard Terms.
"Prepaid Ordinary Expenses" shall be zero (0) for this
Series.
"Prospectus Supplement" shall mean the Prospectus Supplement,
dated September 23, 1997, as amended by an Amended Prospectus Supplement, dated
September 25, 1997, relating to the Certificates.
3
"Purchase Default" shall have the meaning specified in
Section 7(f) hereof.
"Purchaser" shall have the meaning specified in Section
7(f) hereof.
"Rating Agency" shall mean Moody's and S&P.
"Rating Agency Condition" shall have the meaning
specified in the Standard Terms.
"Record Date" shall mean, with respect to each Distribution
Date, the day immediately preceding the related Distribution Date.
"Redemption Date" shall mean any Distribution Date occurring
on or after November 15, 1998 through May 15, 2024, on which the proceeds of an
Optional Redemption are distributed to holders of the Certificates.
"Redemption Price" shall mean, for each related Redemption
Date, the percentage of the face amount of any Underlying Securities redeemed as
set forth in Schedule II.
"Redemption Request" shall have the meaning specified
in Section 7(e) hereof.
"Required Percentage--Amendment" shall be 66-2/3% of
the aggregate Voting Rights.
"Required Percentage--Direction of Trustee" shall be
66-2/3% of the aggregate Voting Rights.
"Required Percentage--Remedies" shall be 66-2/3% of the
aggregate Voting Rights.
"Required Percentage--Removal" shall be 66-2/3% of the
aggregate Voting Rights.
"Required Principal" shall have the meaning specified in the
Standard Terms; provided, however, that in the case of an Optional Redemption,
Required Principal shall be the Redemption
Price.
"Required Rating" shall mean, in the case of Moody's, the
rating assigned to the Underlying Securities by Moody's as of the Closing Date,
and, in the case of S&P, the rating assigned to the Underlying Securities by S&P
as of the Closing Date.
4
"Rights Holder" shall mean the holder or holders of the
Call Rights.
"S&P" shall mean Standard & Poor's, a division of The
XxXxxx-Xxxx Companies, Inc.
"Scheduled Distribution Date" shall mean November 15,
2024.
"Series" shall mean Series 1997-USTS-1.
"Trust Property" shall mean the Underlying Securities
described on Schedule I hereto.
"Underlying Securities Issuer" shall mean the United
States Treasury.
"Voting Rights" shall, in the entirety, be allocated among all
Certificateholders in proportion to the then outstanding principal balances of
their respective Certificates.
(b) The terms listed below are not applicable to this Series.
"Accounting Date"
"Basic Documents"
"Call Premium Percentage"
"Class"
"Collection Period"
"Credit Support"
"Credit Support Instrument"
"Credit Support Provider"
"Cut-off Date"
"Eligible Expense"
"Exchange Rate Agent"
"Fixed Pass-Through Rate"
5
"Floating Pass-Through Rate"
"Guaranteed Investment Contract"
"Initial Accrued Interest"
"Letter of Credit"
"Limited Guarantor"
"Limited Guaranty"
"Liquidation Proceeds"
"Market Agent"
"Market Agent Agreement"
"Notional Amount"
"Optional Exchange Date"
"Pass-Through Rate"
"Required Interest
"Required Premium"
"Requisite Reserve Amount"
"Retained Interest"
"Sub-Administration Agreement"
"Sub-Administration Agent"
"Surety Bond"
"Swap Agreement"
"Swap Counterparty"
"Swap Distribution Amount"
"Swap Guarantee"
"Swap Guarantor"
6
"Swap Receipt Amount"
"Swap Termination Payment"
Section 3. Designation of Trust and Certificates.
-------------------------------------
(a) The Trust created hereby shall be known as the
"Callable Treasury Strip Trust, Series 1997-USTS-1" the Certificates evidencing
certain undivided ownership interests therein shall be known as "Callable
Treasury Strip Trust Certificates, Series 1997-USTS-1" and the Call Rights
evidencing the rights to purchase all of the Underlying Securities (as described
on Schedule II hereto) shall be known as the "Series 1997-USTS-1 Call Rights."
(b) The Certificates shall be held through the Depository in
book-entry form and shall be substantially in the form attached hereto as
Exhibit B. The Certificates shall be issued in minimum denominations of $1,000
and integral multiples of $1,000 in excess thereof. Except as provided in the
Standard Terms, the Trust shall not issue additional Certificates or incur any
indebtedness.
(c) The Call Rights will be uncertificated and shall be as
described in Schedule II attached hereto. The Call Rights will initially be
issued to the Depositor or an affiliate thereof in an initial aggregate amount
of $131,078,000 representing the right to call the corresponding amount of
Underlying Securities and may be transferred by the Depositor to another party
in whole or in part at the sole option of the Depositor without the consent of
the Certificateholders or any other party. The Call Rights are exercisable only
at the direction of all of the holders thereof. The beneficial ownership
interest in the Call Rights will be recorded on the records of the Trustee. On
the Redemption Date, payment will be made on the Call Rights by wire transfer to
the account of the holder thereof on the related Record Date as specified in
written instructions to the Trustee. Notwithstanding any other provision of this
Agreement, the Trustee shall not agree to any amendment or modification of this
Agreement (including the Standard Terms) which would adversely affect in any
material respect the Rights Holders without the consent of such Rights Holders;
provided, however, that such consent shall not be necessary if the Underlying
Securities Issuer is then in default.
7
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 the
Underlying Securities Schedule; and
(ii) all documents required to be delivered to the Trustee
pursuant to Section 2.01 of the Standard Terms.
Section 5. Distributions. (a) On each Distribution
-------------
Date, the Trustee shall apply Available Funds in the Certificate
Account as follows:
(i) first, to the Trustee, reimbursement for Extraordinary
Trust Expenses, if any, incurred by the Trustee pursuant to Section
6(b) hereof; and
(ii) second, the remainder to the Certificateholders.
Section 6. Trustee's Fees. (a) As compensation for its
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services hereunder, the Depositor will pay the fees of the
Trustee. In a separate agreement, to be entered into between the
Depositor and the Trustee, the Depositor will agree to bear all
Ordinary Expenses.
(b) Extraordinary Trust Expenses shall not be paid out of the
Trust Property unless (i) such Extraordinary Trust Expenses relate to a time
when the Underlying Securities Issuer was in default of any payment obligation,
or (ii) Certificateholders representing 100% of the aggregate Voting Rights of
the Certificates have voted to require the Trustee to incur such Extraordinary
Trust Expenses.
Section 7. Optional Exchange; Optional Redemption.
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(a)(i) On each Optional Exchange Date, the Depositor or any
Affiliate thereof, if it is then the holder of Certificates of a certain
principal amount, may tender such Certificates to the Trustee on such Optional
Exchange Date and receive a distribution of a portion of the Underlying
Securities in a face amount at maturity equal to the principal amount of
Certificates then being tendered on such Optional Exchange Date; provided,
however, that in order to effect such Optional Exchange, the Depositor must have
continuously held the
8
Certificates that are the subject of such Optional Exchange for at least 180
days as of the date of such Optional Exchange and, provided, further, that, the
Depositor shall be permitted to tender no more than five percent (5%) of the
outstanding principal amount of Certificates on each Optional Exchange Date.
(ii) The Depositor must provide notice to the
Trustee (an "Exchange Request") no less than 7 Business Days (or such shorter
period acceptable to the Trustee and the Swap Counterparty) but not more than 45
days prior to an Optional Exchange Date that it requests an Optional Exchange of
Certificates on such Optional Exchange Date.
(iii) Prior to effecting an Optional Exchange, the
Trustee may require the Depositor or its affiliate to provide to the Trustee an
officer's certificate to the effect that such Person has continuously held for
at least 180 days the Certificates that are being tendered pursuant to such
Optional Exchange and the Trustee may rely on such officer's certificate in
determining that the conditions to such Optional Exchange have been met.
(b)(i) On any Distribution Date on or after the Distribution
Date in November 1998 through May 15, 2024, the Certificates may be redeemed at
the Redemption Price, in whole but not in part, by the Trust upon receipt of the
Redemption Price in respect of a proportionate amount of Underlying Securities
from each Rights Holder exercising Call Rights acquired from the Depositor.
(ii) The Rights Holder or Holders may provide
notice to the Trustee (a "Redemption Request") no less than 7 Business Days
prior to a Distribution Date occurring on or after the Distribution Date in
November 1998 through May 15, 2024 that it is or they are exercising its or
their Call Rights with respect to the Underlying Securities on such Redemption
Date.
(iii) Upon receipt of a Redemption Request, the
Trustee shall provide a conditional redemption notice to the Depository not less
than 7 Business Days prior to the applicable Redemption Date.
(iv) As a condition to any Optional Redemption, an
opinion of counsel to the Rights Holder shall be delivered to the Rating
Agencies, in form satisfactory to the Rating Agencies, indicating that payment
of the Redemption Price shall not be recoverable as a preferential transfer or
fraudulent conveyance
9
under the United States Bankruptcy Code. Such opinion may
contain customary assumptions and qualifications.
(v) Deliveries of the Underlying Securities by the
Trust to a Rights Holder (the "Purchaser") will only be made against payment by
the Purchaser of the Redemption Price in immediately available funds. Such
payment must occur no later than 10:00 a.m. New York City Time on the Redemption
Date. In the event that the Purchaser fails to make such payment by such time (a
"Purchase Default"), the sale shall be voided and the Optional Redemption will
be deemed not to be effective with respect to such Distribution Date, and the
Certificates and the Call Rights shall continue to remain outstanding.
(vi) The Trustee shall not consent to any amendment
or modification of this Agreement (including the Standard Terms) which would
alter the timing or amount of any payment of the Redemption Price.
(c) The Trustee shall not be obligated to determine whether an
Optional Exchange or Optional Redemption complies with the applicable provisions
for exemption under Rule 3a-7 of the Investment Company Act of 1940, as amended,
or the rules or regulations promulgated thereunder.
(d) This Section 7 shall not provide the Depositor with a lien
against, an interest in or a right to specific performance with respect to the
Underlying Securities.
Section 8. Events of Default. Within 30 days of the occurrence
-----------------
of an event of default under the Underlying Securities, the Trustee will give
notice to the Certificateholders and the Rights Holder, transmitted by mail, of
all such uncured or unwaived events of default known to it.
Section 9. Miscellaneous.
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(a) The provisions of Section 3.04, Liquidation of Underlying
Securities, of the Standard Terms shall not apply to the Series 1997-USTS-1
Certificates in the case of an Optional Redemption pursuant to Section 7 hereof.
(b) The provisions of Section 4.04, Advances, of the Standard
Terms shall not apply to the Series 1997-USTS-1 Certificates.
10
(c) The provisions of Section 4.07, Optional Exchange, of the
Standard Terms shall not apply to the Series 1997-USTS-1 Certificates.
(d) The Trustee shall forward reports to Certificateholders
pursuant to Section 4.03 of the Standard Terms to the New York Stock Exchange.
(e) The Certificateholders shall not be entitled to terminate
the Trust or cause the sale or other disposition of the Underlying Securities,
if and for so long as the Call Rights remains outstanding, without the consent
of the Rights Holder.
(f) In any conflict between the provisions of the Prospectus
Supplement and this Agreement (including the Standard Terms), the provisions of
the Prospectus Supplement shall prevail. Any affirmative statement of rights or
obligations of Certificateholders or the parties hereto included in the
Prospectus Supplement shall be deemed to be included herein.
(g) Interest earned on amounts invested pursuant to Section
3.05 of the Standard Terms shall be paid, on each Distribution Date, to the
Depositor as compensation for its services under the Standard Terms and this
Series Supplement; provided, however, that any interest earned on the Redemption
Price shall be paid, on the Redemption Date, to the Rights Holder.
(h) In any conflict between the provisions of this Series
Supplement and the Standard Terms, the provisions of this Series Supplement
shall control.
(i) The outstanding principal balance of the Certificates
shall not be reduced by the amount of any Realized Loss (as defined in the
Standard Terms).
(j) The Trust may not engage in any business or activities
other than in connection with, or relating to, the holding, protecting and
preserving of the Trust Property and the issuance of the Certificates, and 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 or otherwise
incur, assume or guarantee any indebtedness for money borrowed.
(k) Notwithstanding anything in the Trust Agreement to the
contrary, the Trustee may be removed upon 60 days prior
11
written notice delivered by the holders of the Certificates
representing the Required Percentage--Removal.
(l) In the event that the Internal Revenue Service challenges
the characterization of the Trust as a grantor trust, the Trustee shall then
file such forms as the Depositor may specify to establish the Trust's election
pursuant to Section 761 of the Code to exclude the Trust from the application of
Subchapter K of the Code and is hereby empowered to execute such forms on behalf
of the Certificateholders.
(m) Notwithstanding anything in the Standard Terms to the
contrary, the Trustee, upon written direction by the Depositor, will execute the
Certificates.
Section 10. Notices. All directions, demands and notices
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hereunder or under the Standard Terms shall be in writing and shall be delivered
as set forth below (unless written notice is otherwise provided to the Trustee).
If to the Depositor, to:
Xxxxxx ABS Corporation
3 World Financial Center
New York, New York 10285
Attention: Xxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Trustee, to:
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Department, Trustee
Administration
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Rating Agencies, to:
Xxxxx'x Investors Service, Inc.
00 Xxxxxx Xxxxxx 00X
Xxx Xxxx, Xxx Xxxx 00000
12
Attention: CBO/CLO Monitoring Department
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and to:
Standard & Poor's
00 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Structured Finance Surveillance
Group
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the New York Stock Exchange, to:
New York Stock Exchange, Inc.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Section 11. Governing Law. THIS SERIES SUPPLEMENT AND THE
-------------
TRANSACTIONS DESCRIBED HEREIN SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND
PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CHOICE OF
LAWS PROVISIONS THEREOF.
Section 12. Counterparts. This Series Supplement may
------------
be executed in any number of counterparts, each of which shall be deemed to be
an original, and all such counterparts shall constitute but one and the same
instrument.
Section 13. Termination of the Trust. The Trust shall
------------------------
terminate upon the earliest to occur of the payment in full at maturity or sale
by the Trust in accordance with the Call Rights of all of the Underlying
Securities and the distribution in full of all amounts due to the
Certificateholders.
Section 14. Amendments. Notwithstanding anything in
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the Trust Agreement to the contrary: At all times, 100% of all Voting Rights
will be allocated among all Certificateholders, in proportion to the then
outstanding principal balances of their
13
respective Certificates. The "Require Percentage--Amendment" of Voting Rights of
those Certificates that are materially adversely affected by any modification or
amendment of the Trust Agreement necessary to consent to such modification or
amendment shall be 66-2/3%. In addition to the other restrictions on
modification and amendment, the Trustee will not enter into any amendment or
modification of the Trust Agreement which would adversely affect in any material
respect the interests of the Rights Holders without the consent of Rights
Holders representing the right to make Redemption Requests with respect to
66-2/3% of the Underlying Securities; provided, however, that no such amendment
or modification will be permitted which would alter the timing or amount of any
payment of the Redemption Price, without the consent of all Rights Holders, or
which would alter the status of the Trust as a grantor trust for federal income
tax purposes. Further, no amendment to the Call Rights will be permitted which
would adversely affect in any material respect the interests of the
Certificateholders without the consent of Certificateholders representing 66-2/3
of the aggregate Voting Rights of those Certificates that are materially
adversely affected by such modification or amendment and without confirmation by
each Rating Agency that such amendment will not result in a downgrading or
withdrawal of its rating of the Certificates; provided, however, that no such
amendment or modification will be permitted which would alter the timing or
amount of any payment of the Redemption Price, without the consent of the
Certificateholders representing 100% of the aggregate Voting Rights of the
Certificates or which would alter the status of the Trust as a grantor trust for
federal income tax purposes. In addition, the Call Rights generally may not be
amended without the consent of 66-2/3% of the Rights Holders thereof (or 100%,
in the case of any amendment that would alter the timing or amount of any
payment of the Redemption Price.
14
IN WITNESS WHEREOF, the parties hereto have caused this Series
Supplement to be duly executed by their respective authorized officers as of the
date first written above.
XXXXXX ABS CORPORATION,
as Depositor
By: /s/ Xxxx X. Xxxx
---------------------------------
Name: Xxxx X. Xxxx
Title: Senior Vice President
THE BANK OF NEW YORK, not in its
individual capacity but solely as
Trustee on behalf of the Callable
Treasury Strip Trust, Series
1997-USTS-1
By: /s/ Xxxxxxxx Xxxxxxx
--------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Assistant Treasurer
15
SCHEDULE I
SERIES 1997-USTS-1
UNDERLYING SECURITIES SCHEDULE
------------------------------
Underlying Securities: Strips representing the
principal amount payable upon
maturity of United States
Treasury bonds due November
15, 2024 (the "Strips"),
subject to the Call Rights
Underlying Securities Issuer: United States Treasury
("United States Government")
CUSIP Number: 912803 BD 4
Principal Amount Deposited: $131,078,000
Original Issue Date: Unknown
Principal Amount of
Underlying Securities
Originally Issued: Unknown
Maturity Date: November 15, 2024
Interest Rate: 0.00%
Interest Payment Dates: Not Applicable
Initial Accrued Interest: Not Applicable
Redemption Dates: None
Redemption Prices: None
Priority: Unknown
Security: None
Rating as of Closing: "Aaa" by Moody's
"AAA" by S&P.
Form of Underlying Securities: Book-entry system of the U.S.
Federal Reserve Banks.
Retained Interest: None
I-1
SCHEDULE II
SERIES 1997-USTS-1
DESCRIPTION OF THE CALL RIGHTS
-------------------------------
The Call Rights represents the rights to purchase at a set
Redemption Price on each specific Redemption Date all of the Underlying
Securities. Such purchase will result in an Optional Redemption of the
Certificates. The Redemption Prices, as set forth below, correspond to the
related Redemption Dates.
Price as a Price as a
% of the % of the
Face Amount Face Amount
of the of the
Redemption Underlying Redemption Underlying
Date Securities Date Securities
---------- ----------- ---------- ------------
11/15/98 13.010% 11/15/11 36.069%
05/15/99 13.530 05/15/12 37.512
11/15/99 14.071 11/15/12 39.012
05/15/00 14.634 05/15/13 40.573
11/15/00 15.219 11/15/13 42.196
05/15/01 15.828 05/15/14 43.883
11/15/01 16.461 11/15/14 45.639
05/15/02 17.120 05/15/15 47.464
11/15/02 17.805 11/15/15 49.363
05/15/03 18.517 05/15/16 51.337
11/15/03 19.257 11/15/16 53.391
05/15/04 20.028 05/15/17 55.526
11/15/04 20.829 11/15/17 57.748
05/15/05 21.662 05/15/18 60.057
11/15/05 22.529 11/15/18 62.460
05/15/06 23.430 05/15/19 64.958
11/15/06 24.367 11/15/19 67.556
05/15/07 25.342 05/15/20 70.259
11/15/07 26.355 11/15/20 73.069
05/15/08 27.409 05/15/21 75.992
11/15/08 28.506 11/15/21 79.031
05/15/09 29.646 05/15/22 82.193
11/15/09 30.832 11/15/22 85.480
05/15/10 32.065 05/15/23 88.900
11/15/10 33.348 11/15/23 92.456
05/15/11 34.682 05/15/24 96.154
II-1
EXHIBIT A
Standard Terms for Trust Agreements
(begins on next page)
================================================================================
STANDARD TERMS FOR TRUST AGREEMENTS
between
XXXXXX ABS CORPORATION,
as Depositor
and
THE BANK OF NEW YORK,
as Trustee
BOND-BACKED CERTIFICATES
Dated as of February 28, 1996
================================================================================
TABLE OF CONTENTS
Page
PRELIMINARY STATEMENT...................................................... 1
ARTICLE I Definitions and Assumptions................................ 1
SECTION 1.01. Definitions...................................... 1
SECTION 1.02. Rules of Construction............................ 20
SECTION 1.03. Compliance Certificates and Opinions;
Record Date...................................... 21
ARTICLE II Declaration of Trusts; Issuance of Certificates;
Purpose and Classification of Trusts....................... 23
SECTION 2.01. Creation and Declaration of Trusts:
Assignment of Underlying Securities.............. 23
SECTION 2.02. Acceptance by Trustee............................ 25
SECTION 2.03. Representations and Warranties of the
Depositor. ...................................... 25
SECTION 2.04. Breach of Representation, Warranty or
Covenant......................................... 26
SECTION 2.05. Agreement to Authenticate and Deliver
Certificates..................................... 26
ARTICLE III Administration of each Trust............................... 27
SECTION 3.01. Administration of each Trust..................... 27
SECTION 3.02. Collection of Certain Underlying
Security Payments................................ 27
SECTION 3.03. Certificate Account.............................. 27
SECTION 3.04. Liquidation of the Underlying
Securities....................................... 29
SECTION 3.05. Investment of Funds in the Accounts.............. 29
SECTION 3.06. Maintenance of Credit Support.................... 30
SECTION 3.07. Realization Upon Defaulted Underlying
Securities....................................... 30
SECTION 3.08. Retained Interest................................ 31
SECTION 3.09. Access to Certain Documentation.................. 32
SECTION 3.10. Reports by the Depositor......................... 32
SECTION 3.11. Charges and Expenses............................. 33
ARTICLE IV Distributions and Reports to
Certificateholders......................................... 33
SECTION 4.01. Distributions.................................... 33
SECTION 4.02. Distributions on Certificates.................... 34
SECTION 4.03. Reports to Certificateholders.................... 36
SECTION 4.04. Advances......................................... 38
i
Page
SECTION 4.05. Allocation of Realized Losses and
Trust Expenses................................... 39
SECTION 4.06. Compliance with Withholding
Requirements..................................... 39
SECTION 4.07. Optional Exchange................................ 40
ARTICLE V The Certificates........................................... 42
SECTION 5.01. The Certificates................................. 42
SECTION 5.02. Execution, Authentication and
Delivery......................................... 43
SECTION 5.03. Temporary Certificates........................... 44
SECTION 5.04. Registration; Registration of
Transfer and Exchange............................ 45
SECTION 5.05. Mutilated, Destroyed, Lost and Stolen
Certificates..................................... 50
SECTION 5.06. Persons Deemed Owners............................ 51
SECTION 5.07. Cancellation..................................... 52
SECTION 5.08. Global Securities................................ 52
SECTION 5.09. Notices to Depository............................ 54
SECTION 5.10. Definitive Certificates.......................... 54
SECTION 5.11. Currency of Distributions in Respect
of Certificates.................................. 55
SECTION 5.12. Conditions of Authentication and
Delivery of New Series........................... 56
SECTION 5.13. Appointment of Paying Agent...................... 57
SECTION 5.14. Authenticating Agent............................. 58
SECTION 5.15. Voting Rights with Respect to
Underlying Securities............................ 59
SECTION 5.16. Actions by Certificateholders.................... 60
SECTION 5.17. Events of Default................................ 61
SECTION 5.18. Judicial Proceedings Instituted by
Trustee; Trustee May Bring Suit.................. 61
SECTION 5.19. Control by Certificateholders.................... 62
SECTION 5.20. Waiver of Past Defaults.......................... 62
SECTION 5.21. Right of Certificateholders to
Receive Payments Not to Be Impaired.............. 63
SECTION 5.22. Remedies Cumulative.............................. 63
ARTICLE VI The Depositor.............................................. 63
SECTION 6.01. Liability of the Depositor....................... 63
SECTION 6.02. Limitation on Liability of the
Depositor........................................ 64
SECTION 6.03. Depositor May Purchase Certificates.............. 65
SECTION 6.04. Merger or Consolidation of the
Depositor........................................ 65
SECTION 6.05. No Liability of the Depositor with
Respect to the Underlying Securities;
ii
Page
Certificateholders to Proceed
Directly Against the Issuer(s)................... 65
ARTICLE VII Concerning the Trustee..................................... 66
SECTION 7.01. Duties of Trustee................................ 66
SECTION 7.02. Between Trustee and Sub-
Administrative Agents............................ 70
SECTION 7.03. Certain Matters Affecting the
Trustee.......................................... 71
SECTION 7.04. Trustee Not Liable for Recitals in
Certificates or Underlying
Securities....................................... 73
SECTION 7.05. Trustee May Own Certificates..................... 73
SECTION 7.06. Trustee's Fees and Expenses...................... 73
SECTION 7.07. Eligibility Requirements for Trustee............. 74
SECTION 7.08. Resignation or Removal of the
Trustee; Appointment of Successor
Trustee.......................................... 75
SECTION 7.09. Appointment of Office or Agency.................. 77
SECTION 7.10. Representations and Warranties of
Trustee.......................................... 77
SECTION 7.11. Indemnification of Trustee by the
Depositor; Contribution.......................... 78
SECTION 7.12. Indemnification of Depositor by
Trustee.......................................... 80
SECTION 7.13. No Liability of the Trustee with
Respect to the Underlying Securities;
Certificateholders to Proceed
Directly Against the Issuer(s)................... 80
SECTION 7.14. The Depositor To Furnish Trustee with
Names and Addresses of
Certificateholders............................... 81
SECTION 7.15. Preservation of Information...................... 81
SECTION 7.16. Reports by Trustee............................... 81
SECTION 7.17. Trustee's Application for
Instructions from the Depositor.................. 81
ARTICLE VIII Market Agent............................................... 82
SECTION 8.01. Market Agent..................................... 82
ARTICLE IX Termination................................................ 82
SECTION 9.01. Termination upon Liquidation of All
Underlying Securities............................ 82
ARTICLE X Miscellaneous Provisions......................... 83
SECTION 10.01. Amendment........................................ 83
iii
Page
SECTION 10.02. Limitation on Rights of
Certificateholders............................... 85
SECTION 10.03. GOVERNING LAW.................................... 86
SECTION 10.04. Notices.......................................... 86
SECTION 10.05. Notice to Rating Agencies........................ 87
SECTION 10.06. Severability of Provisions....................... 88
SECTION 10.07. Grant of Security Interest....................... 88
SECTION 10.08. Nonpetition Covenant............................. 90
SECTION 10.09. No Recourse...................................... 90
SECTION 10.10. Article and Section References................... 90
SECTION 10.11. Counterparts..................................... 91
SECTION 10.12. Trust Indenture Act Controls..................... 91
iv
STANDARD TERMS FOR TRUST AGREEMENTS dated as of February
28, 1996, among XXXXXX ABS CORPORATION, a Delaware
corporation, as Depositor, and THE BANK OF NEW YORK, a New
York banking corporation, as Trustee.
PRELIMINARY STATEMENT
The Depositor and the Trustee 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) of Certificates will be issued only under a separate Series Supplement
to these Standard Terms, duly executed and delivered by the Depositor and the
Trustee. With respect to each Series, the applicable Series Supplement, together
with these Standard Terms, shall be known as the "Trust Agreement."
All representations, covenants and agreements made herein by each of
the Depositor and the Trustee are for the benefit and security of the
Certificateholders and, to the extent provided in the applicable Series
Supplement, for the benefit and security of any Credit Support Provider or any
other party as specified therein;
The Depositor is entering into these Standard Terms, and the Trustee
in accepting the trusts 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 Series 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 Series 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.
"Allowable Expense Amount": With respect to any
Series, as defined in the related Series Supplement.
"Authenticating Agent": As defined in Section 5.14.
"Authorized Newspaper": A newspaper in an official language of the
country of publication customarily published at least once a day, and
customarily published for at least five days in each calendar week, and of
general circulation in such city or cities specified pursuant to Section 5.01
with respect to the Certificates of any Series. Where successive publications
are required to be made in Authorized Newspapers, the successive publications
may be made in the same or in different newspapers in the same city meeting the
foregoing requirements and in each case on any Business Day in such city.
"Available Funds": Unless otherwise specified in the applicable
Series 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 on
amounts in the Accounts) 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 Series Supplement.
"Basic Documents": With respect to any Series, if
applicable, as defined in the related Series Supplement.
"Bearer Certificate": Any Certificate (with or without
Coupons), title to which passes by delivery only, but exclusive
of any Coupons.
2
"Beneficial Owner": Shall mean, 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 Series 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.
"Business Day": With respect to any Place of Distribution specified
pursuant to Section 5.01, any day that is not a Saturday, a Sunday or a legal
holiday or a day on which banking institutions or trust companies in such Place
of Distribution are authorized or obligated by law, regulation or executive
order to close or any day which is not a Business Day with respect to the
Underlying Securities, except as otherwise specified pursuant to Section 5.01
and any Business Day specified with respect to the Underlying Securities.
"Call Premium Percentage": With respect to any Series
(or Class with such Series), if applicable, as defined in the
related Series Supplement.
"Certificate Account": As defined in Section 3.03.
"Certificate Owners": As defined in Section 5.08.
"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 Series Supplement), as of any date of determination, shall be equal to
the aggregate initial Certificate Principal Balance thereof less the sum of (i)
all amount allocable to prior distributions made to such Class in respect to
principal of the Underlying Securities, (ii) any
3
reductions attributable to Certificates surrendered in exchange for Underlying
Securities, as and to the extent provided in the applicable Series 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 Series Supplement, each as
allocated to such Class pursuant to the applicable Series Supplement.
"Certificateholder": Any Holder of a Certificate.
"Certificate Register" and "Certificate Registrar": As
respectively defined in Section 5.04.
"Certificates": Any trust certificates authorized by,
and authenticated and delivered under, this Trust Agreement.
"Class": With respect to any Series, any one of the
classes of Certificates of such Series, each consisting of
Certificates having identical terms.
"Clearing Agency": An organization registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act.
"Closing Date": With respect to any Series, the day on
which Certificates of such Series are first executed,
authenticated and delivered.
"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 Series 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.
"Corporate Trust Office": The principal corporate
trust office of the Trustee located at the address set forth in
the related Series Supplement or such other addresses 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
4
successor Trustee (or such other addresses as a successor Trustee may designate
from time to time by notice to the Holders and the Depositor).
"Coupon": Any interest coupon appertaining to a Bearer
Certificate.
"Coupon Certificate": Any Bearer Certificate
authenticated and delivered with one or more Coupons appertaining
thereto.
"Credit Support": With respect to any Series (or any Class within
such Series), a letter of credit, surety bond, swap agreement, put or call
option or other asset intended to support or ensure the timely or ultimate
distributions of amounts due in respect of all or certain of the Underlying
Securities for such Series or Class, which in each case is specified as such in
the related Series Supplement.
"Credit Support Instrument": The instrument or
document pursuant to which the Credit Support for a given Series
(or any Class within such Series) is provided, as specified in
the applicable Series Supplement.
"Credit Support Provider": With respect to any Series (or any Class
with such Series), the Person, if any, that will provide any Credit Support with
respect to all or a portion of the Underlying Securities for such Series or
Class as specified in the applicable Series Supplement.
"Currency": Dollars or Foreign Currency.
"Cut-off Date": With respect to any Series, the date specified as
such in the related Series 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.
"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
5
designated as Depository by the Depositor pursuant to Section 5.01 until a
successor Depository shall have become such pursuant to the applicable
provisions of this Trust Agreement, and thereafter "Depository" shall mean or
include each Person who is then a Depository hereunder, 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.
"Depositor": Xxxxxx ABS Corporation, 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 provisions of this Trust Agreement that relate to
the provisions of this Trust Agreement that relate to the provisions of the
Trust Indenture Act, "Depositor" shall include any obligor on the Certificates
as the term obligor is defined in the Trust Indenture Act.
"Depositor Order" or "Depositor Request": A written
order or request, respectively, signed in the name of the
Depositor by any of its President or Vice Presidents.
"Depository Agreement": If applicable, the agreement
pursuant to which the Depository will agree to act as Depository
with respect to any Series (or Class within such Series) of
Certificates in accordance with Section 5.08.
"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) of Certificates, each date specified as
a "Distribution Date" for such Series (or Class) in the related
Series 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.
"Eligible Account": Either (i) an account or accounts
maintained with a Federal or State chartered depository
institution or trust company the long term unsecured debt
obligations of which are rated by the Rating Agency the higher of
6
(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 Series 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 Expense": With respect to any Series, as
specified in the related Series Supplement.
"Eligible Investments": With respect to any Series, unless otherwise
specified in the related Series 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" 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 of America;
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, it has the rating specified in such Series
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 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)
7
at the time of such investment or contractual commitment providing for
such investment have the rating specified in such Series Supplement for
Eligible Investments; provided, however, that such rating shall be no
lower than the rating on the Underlying Securities at the time of purchase
of the investments;
(iii) repurchase agreements with respect to (a) any security
described in clause (i) above or (b) any other security issued or
guaranteed by an agency or instrumentality of the United States, with an
entity having the credit rating specified in such Series Supplement for
Eligible Investments;
(iv) 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 Series 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 rating on the Underlying Securities; 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;
(v) commercial paper having at the time of such investment the
rating specified in the Series Supplement for Eligible Investments; and
(vi) a Guaranteed Investment Contract if and only if specified in
the related Series Supplement, provided that the Rating Agency Condition
is met.
"Event of Default": With respect to any Series (or
Class within such Series) of Certificates, as specified in the
related Series Supplement.
"Exchange Act": The Securities Exchange Act of 1934,
as amended.
"Exchange Rate Agent": With respect to any Series (or
Class within such Series) of Certificates, if applicable, the
8
Depositor or its agent so specified in the related Series Supplement.
"Extraordinary Trust Expense": Unless otherwise specified in the
related Series Supplement, 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.
"Final Scheduled Distribution Date": With respect to any
Certificate, the date on which all the unpaid principal of (and premium, if any,
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 Series Supplement.
"Fixed Pass-Through Rate": With respect to any Fixed
Rate Certificate, as defined in the related Series 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 Series
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
pursuant to Section 5.01 and the related Series Supplement.
"Foreign Currency": A currency issued by the
government of any country other than the United States or a
composite currency the value of which is determined by reference
to the values of the currencies of any group of countries.
"Global Security": A Registered Certificate or Bearer Certificate
evidencing all or part of a Series (or Class within such Series) of
Certificates, issued to the Depository for such Series or Class in accordance
with Section 5.08 and bearing the legend prescribed therein.
"Grant": To sell, convey, assign, transfer, create,
xxxxx x xxxx upon and a security interest in and right of set-off
against, deposit, set over and confirm to the Trustee pursuant to
these Standard Terms and a related Series Supplement; and the
9
terms "Granted" and "Granting" have the meanings correlative to the foregoing. A
Grant of any Underlying Securities or of any other instrument shall include all
rights, powers and options (but none of the obligations) of the Granting party
thereunder, 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 such Underlying Securities and all other moneys payable
thereunder, to give and receive notices and other communications, to make
waivers or other agreements, to exercise all rights and options, to bring
Proceedings in the name of the Granting party or otherwise, and generally to do
and receive anything that the Granting party is or may be entitled to do or
receive thereunder or with respect thereto.
"Guaranteed Investment Contract": With respect to any Series (or
Class within such Series), a guaranteed investment contract or surety bond
provided for in the related Series Supplement, Granted as part of the Trust or
to the Trustee for the benefit of the Certificateholders for such Series,
providing for the investment of funds in a related Account or related Accounts
and insuring a minimum or a fixed rate of return on the investment of such
funds, which contract or surety bond shall be an obligation of an insurance
company or other entity whose rating is no lower than the rating on the
Underlying Securities and shall satisfy any other requirements specified in such
Series Supplement.
"Holder": With respect to a Registered Certificate,
the Registered Holder thereof and, with respect to a Bearer
Certificate or a Coupon, the bearer thereof.
"Independent": When used with respect to any specified Person means
that the 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
as an officer, employee, promoter, underwriter, trustee, partner, director or
person performing similar functions.
"Initial Accrued Interest": With respect to any Series, shall mean,
with respect to each Underlying Security, the amount of interest which accrued
thereon from the Underlying Security Interest Payment Date of such Underlying
Security next preceding the deposit of such Underlying Security hereunder (or,
in the event that such Underlying Security Interest Payment Date is the first
Underlying Security Interest Payment Date to occur
10
after the original issuance of such Underlying Security, from the dated date
thereof) to, but excluding, the Closing Date.
"Issuer": Shall mean, with respect to an Underlying
Security, the issuer thereof (including, if applicable, the
guarantor of the Underlying Security) as identified in Appendix A
to the Series Supplement.
"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 Series Supplement.
"Limited Guarantor": With respect to the Underlying Securities
relating to any series (or Class within such Series), a Person specified in the
related Series Supplement as providing a guarantee or insurance policy or other
credit enhancement supporting the distributions in respect of such Series (or
Class) as and to the extent specified in such Series 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 Series Supplement.
"Liquidation Proceeds": The amounts received by the
Trustee in connection with (i) the liquidation of a defaulted
Underlying Security or collateral, if any, related thereto or
(ii) the repurchase, substitution or sale of a Underlying
Security.
"Market Agent": Shall mean the market agent or market
agents appointed pursuant to Section 8.01, and its or their
successors or assigns.
"Market Agent Agreement": With respect to any Series
shall mean the Market Agent Agreement, dated as of the Closing
Date, between the Trustee and the Market Agent, the form of which
will be attached to the Series Supplement, and any similar
11
agreement with a successor Market Agent, in each case as from time to time
amended or supplemented.
"Moody's": Shall mean 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 Series
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
Series Supplement.
"Officer's Certificate": A certificate signed by
anyone (or, if specified in these Standard Terms or any Series
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 Date": With respect to any Series
(or Class with such Series), as defined, if applicable, in the
related Series Supplement.
"Ordinary Expenses": The Trustee's customary fee for its services as
Trustee, 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 routing 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 authenticated
12
and delivered under these Standard Terms and the related Series
Supplement except:
(i) Certificates theretofore cancelled by the
Certificate Registrar or delivered to the Certificate
Registrar for cancellation; and
(ii) Certificates in exchange for or in lieu of which other
Certificates have been 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;
provided, however, that in determining whether the Holders of the required
percentage of the aggregate Voting Rights of the Certificates have given any
request, demand, authorization, direction, notice, consent or waiver hereunder,
Certificates beneficially owned by the Depositor, the Trustee, or any Affiliate
thereof shall be disregarded and deemed not to be Outstanding, and the Voting
Rights to which its Holder would otherwise be entitled 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 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 and that the pledgee is not, to the knowledge of the Trustee, the
Depositor, or any Affiliate of any thereof. The principal amount or notional
amount, as applicable, of a Discount Certificate that shall be deemed to be
Outstanding for the defemination referred to in the foregoing proviso shall be
the Certificate Principal Balance or Certificate Notional Amount, as applicable,
with respect thereto as of the date of such determination, and the principal
amount or notional amount, as applicable, of a Certificate denominated in a
Foreign Currency that shall be deemed to be Outstanding for purposes of the
determination referred to in the foregoing provision shall be the amount
calculated pursuant to Section 5.11(c).
"Participant": A broker, dealer, bank, other financial
institution or other Person for whom from time to time a
13
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) of Certificates (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 Series Supplement.
"Paying Agent": As defined in Section 5.13.
"Percentage Interest": With respect to a Certificate of any Series
or Class within a Series, the portion of such Series or Class evidenced by such
Certificate, expressed as a percentage, equal to the product of (x) a fraction,
the numerator of which is the initial Certificate Principal Balance or Notional
Amount, as applicable, represented by such Certificate and the denominator of
which is the aggregate initial Certificate Principal Balance or Notional Amount,
as applicable, of all the Certificates of such Series or Class and (y) 100.
"Person": Any individual, corporation, partnership,
joint venture, association, joint stock company, trust (including
any beneficiary thereof), unincorporated organization or
government or any agency or political subdivision thereof.
"Place of Distribution": With respect to any Series (or Class within
such Series) of Certificates, the place or places where the principal of (and
premium, if any) and interest on the Certificates or such Series (or Class) are
distributable as specified pursuant to Section 5.01.
"Predecessor Certificate": With respect to any particular
Certificate, every previous Certificate evidencing all or a portion of the same
interest as that evidenced by such particular Certificate; and for the purpose
of this definition, any Certificate authenticated and delivered under Section
5.05 in lieu of a lost, destroyed or stolen Certificate shall be deemed to
evidence the same interest as the lost, destroyed or stolen Certificate.
"Prepaid Ordinary Expenses": Unless otherwise
specified in the Series Supplement, the amount (if any) paid by
the Depositor to the Trustee on or before the Closing Date to
14
cover Ordinary Expenses, as specified in the related Series
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 rating organization specified in the related
Series Supplement that initially rates the Certificates of such Series (or
Class).
"Rating Agency Condition": With respect to any action or occurrence,
unless otherwise specified in the applicable Series Supplement, that each Rating
Agency shall have been given 10 days (or such shorter period acceptable to each
Rating Agency) prior 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 Losses": With respect to any defaulted and liquidated
Underlying Security, the excess, if any, of (x) the principal amount of such
Underlying Security plus accrued and unpaid interest thereon, plus expenses
incurred by the Trustee in connection with the practices and procedures referred
to in Section 3.07(b) to the extent reimbursable under these Standard Terms and
the related Series Supplement, over (y) Liquidation Proceeds with respect
thereto.
"Record Date": With respect to any Distribution Date
for any Series (or Class within such Series) of Registered
Certificates, the date specified in the related Series
Supplement.
"Registered Certificate": Any Certificate registered
as to principal, premium, if any, and interest in the Certificate
Register.
"Registered Holder": The Person in whose name a
Registered Certificate is registered in the Certificate Register
on the applicable Record Date.
"Required Interest": Unless otherwise specified in the
related Series Supplement, with respect to the Outstanding
Certificates of any Series or any Class thereof, the accrued and
undistributed interest on the Certificate Principal Balance or
Notional Amount of such Outstanding Certificates (or the amount
15
due under any related Coupons), computed at the applicable Pass-
Through Rate.
"Required Percentage--Amendment": Unless otherwise specified in the
related Series Supplement, if a Rating Agency Condition is specified in the
related Series Supplement and such Rating Agency Condition is met, or, if a
Rating Agency Condition is not so specified in the related Series Supplement,
66-2/3% of the aggregate Voting Rights of Certificates of such Series, and 100%
otherwise.
"Required Percentage--Definitive Certificates": Unless
otherwise specified in the related Series Supplement, 66 2/3% of
the aggregate Voting Rights of Certificates of such Series.
"Required Percentage--Direction of Trustee": Unless
otherwise specified in the related Series Supplement, 66 2/3% of
the aggregate Voting Rights of Certificates of such Series.
"Required Percentages--Remedies": Unless otherwise
specified in the related Series Supplement, 66-2/3% of the
aggregate Voting Rights of Certificates of such Series.
"Required Percentage--Removal of Trustee": Unless
otherwise specified in the related Series Supplement, more than
50% of the aggregate Voting Rights of Certificates of such
Series.
"Required Percentage--Waiver": Unless otherwise
specified in the related Series Supplement, 66-2/3% of the
aggregate Voting Rights of Certificates of such Series.
"Required Premium": If applicable, unless otherwise specified in the
related Series Supplement, with respect to the Certificates of any Series or any
Class thereof, an amount equal to the product, as determined on any Distribution
Date with respect to such Series and Class, of (i) the Required Principal for
such Series and Class and (ii) the Call Premium Percentage for such Series and
Class.
"Required Principal": As determined for any Distribution Date for a
given Series (or Class within such Series), unless otherwise specified in the
related Series 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
16
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 Series Supplement.
"Required Rating": With respect to any Series (or Class within such
Series), the rating category (or categories) specified in the Series Supplement
that, as a condition to the issuance of such Series or Class, is (or are) the
lowest category (or categories) in which the Certificates of such Series or
Class may be categorized by the Rating Agency.
"Requisite Reserve Amount": As of any date with respect to any
Series (or Class within such Series) of Certificates, 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 Series 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 of the Trustee, including any Vice President,
Assistant Vice President, Assistant Treasurer 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 Series Supplement,
held by the Person so specified in such Series Supplement.
"Sale Procedures": Unless otherwise specified in the Series
Supplement, shall mean that, with respect to any sale of one or more Underlying
Securities, the Market Agent, on behalf of the Trust, shall sell such Underlying
Security or Underlying Securities to the highest bidders among not less than two
solicited bidders for such Underlying Securities (one of which bidders may
include Xxxxxx Brothers Inc. or any affiliate thereof; provided, however, that
neither Xxxxxx Brothers Inc. nor any of its affiliates will be under any
obligation to bid, and which bidders need not be limited to recognized broker
dealers).
17
In the sole judgment of the Market Agent, bids may be evaluated on the basis of
bids for a single Underlying Security, a portion of the Underlying Securities or
all of the Underlying Securities being sold or any other basis selected in good
faith by the Market Agent.
"S&P": Shall mean Standard & Poor's, a division of The
XxXxxx-Xxxx Companies, Inc. and any successor thereof.
"Series": A separate series of Certificates issued
pursuant to these Standard Terms and a related Series Supplement,
which series may be divided into two or more Classes, as provided
in such Series Supplement.
"Series Supplement": An agreement incorporating these
Standard Terms that authorizes the issuance of a particular
Series (and each Class within such Series) of Certificates.
"Specified Currency": As defined in the related Series
Supplement.
"Sub-Administration Account": As defined in Section
7.02.
"Sub-Administration Agreement": The written contract,
if any, between the Trustee and a Sub-Administrative Agent and
any successor Trustee or Sub-Administrative Agent relating to the
administration of certain Underlying Securities as provided in
Section 7.02.
"Sub-Administration Agent": Any Person with which the
Trustee has entered into a Sub-Administration Agreement and which
meets the qualifications of a Sub-Administrative Agent pursuant
to Section 7.02.
"Surety Bond": If so specified in the Series Supplement, with
respect to any Series (or Class within such Series) of Certificates, the surety
bond providing for the distribution under certain circumstances specified in
such Series 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 Series Supplement.
"Swap Agreement": If so specified in the Series
Supplement, with respect to any Series, shall mean the ISDA
Master Agreement dated as of the Closing Date by and between the
Trust and the Swap Counterparty, the form of which Schedule is
18
attached thereto as Exhibit C, as the same may be amended or supplemented by
Confirmations from time to time as provided herein and therein.
"Swap Counterparty": If so specified in the Series
Supplement, with respect to any Series, shall be specified in the
Series Supplement.
"Swap Distribution Amount": If so specified in the Series
Supplement, with respect to any Series, shall mean 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 Series Supplement, with
respect to any Series, shall mean, the Guarantee issued by the Swap Guarantor in
favor of the Trust substantially in the form attached as Exhibit D to the Swap
Agreement.
"Swap Guarantor": If so specified in the Series
Supplement, with respect to any Series, shall be specified in the
Series Supplement.
"Swap Receipt Amount": If so specified in the Series
Supplement, with respect to any Series, shall mean 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 Series
Supplement, with respect to any Series, means the amount payable by the Swap
Counterparty to the Trust, or by the Trust to the Swap Counterparty, pursuant to
Section 6(e) of the Swap Agreement.
"Trust": With respect to any Series, the segregated asset or pool of
assets subject hereto, constituting the trust created hereby and by the related
Series Supplement and to be administered hereunder and thereunder, consisting of
those Underlying Securities and 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 Series Supplement, all for the benefit of the
Certificateholders of such Series as of any particular time.
"Trust Agreement": With respect to each Series of
Certificates, these Standard Terms and all amendments hereof and,
unless the context otherwise requires, the related Series
Supplement and all amendments thereto.
19
"Trustee": With respect to any Series, the Person so specified in
the applicable Series Supplement, until a successor Person shall have become the
Trustee pursuant to the applicable provisions of these Standard Terms and the
applicable Series Supplement, and thereafter "Trustee" shall mean such successor
Person.
"Trust Indenture Act": The Trust Indenture Act of
1939, as amended, as the same is in force and effect as of the
date hereof.
"Underlying Security" or "Underlying Securities": With respect to
any Series, the asset or assets Granted as part of the Trust for such Series or
acquired (or, in the case of an agreement, entered into) by the Trustee for the
benefit of the Holders of such Series, and, if and to the extent provided in the
applicable Series Supplement, for the benefit of any Credit Support Provider,
all as identified in the Schedule A to the related Series Supplement. The
Underlying Securities for any such Series or the related Trust shall not
constitute Underlying Securities for any other Series or any other Trust.
"Underlying Security Interest Payment Date": Shall mean, with
respect to an Underlying Security, each date specified in Schedule A to the
Series Supplement as a date on which interest is scheduled, as of the Closing
Date, to be payable by or on behalf of the Issuer on such Underlying Security in
accordance with its terms.
"Underlying Security Payment Date": Shall mean a Schedule Underlying
Security Payment Date and any other date on which interest, principal and/or
redemption premium is payable on an Underlying Security in accordance with its
terms.
"Uniform Commercial Code": The Uniform Commercial Code
as in effect in the relevant jurisdiction or, with respect to the
State of Louisiana, the equivalent body of statutory and common
law.
"United States": The United States of America
(including the States), its territories, its possessions and
other areas subject to its jurisdiction.
"Voting Rights": With respect to any Series (or Class within such
Series) of Certificates, the portion of the aggregate voting rights of the
Certificates of such Series or Class which shall be allocated to any Certificate
as specified in the applicable Series Supplement.
20
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 this Trust Agreement (other than a
certificate provided pursuant to Section 3.10(d)) shall include:
(1) a statement that the individual signing such certificate
or opinion has read such covenant or condition and the definitions herein
relating thereto;
21
(2) 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;
(3) 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
(4) 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 of any
subclass of Certificates entitled to give any consent, request, demand,
authorization, direction, notice, waiver or other Act. Notwithstanding Section
316(c) of the Trust Indenture Act, 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 of Certificates of the
applicable subclass at the close of business on such record date shall be deemed
to be Certificateholders of such subclass for the purposes of determining
whether Holders of the requisite aggregate Principal Amount of Outstanding
Certificates of such subclass have authorized or agreed or consented to such
consent, request, demand, authorization, direction, notice, waiver or other act,
and for that purpose the aggregate Principal Amount of the Outstanding
Certificates of such subclass 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 of Certificates of such
subclass on such record date shall be deemed effective unless it shall become
effective pursuant to the provisions of this Trust Agreement not later than one
year after the record date.
22
ARTICLE II
Declaration of Trusts; Issuance of Certificates;
Purpose and Classification of Trusts
SECTION 2.01. Creation and Declaration of Trusts: Assignment of
Underlying Securities. (a) The Depositor, concurrently with the execution and
delivery hereof, does hereby agree to Grant to the Trustee, on behalf and for
the benefit of the Certificateholders of each given Series of Certificates 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 attributable to each such Series (except for the
Underlying Securities attributable to such Series which are not Granted by the
Depositor, as specified in Schedule A to the applicable Series Supplement), now
existing or hereafter acquired, in each case as identified on the applicable
Schedule A, and all other assets included or to be included in the respective
Trust for the benefit of the Certificateholders of each such Series. Each such
Grant will include all interest, premium (if any) and principal received by or
on behalf of the Depositor of, on or with respect to any such Underlying
Securities due after the applicable Cut-off Date, and, unless otherwise
specified in the Series Supplement, will exclude (i) all interest, premium (if
any) and principal of, on or with respect to any such Underlying Securities due
on or before the applicable Cut-off Date and (ii) any Retained Interest in any
such Underlying Security.
(b) In connection with each Grant referred to in the preceding
paragraph, 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 which are to be acquired from
a Person other than the Depositor, as specified on the Underlying Securities
Schedule to the applicable Series Supplement) with the Trustee by physical
delivery of such Underlying Securities, duly endorsed, to the Trustee or (ii)
have delivered such Underlying Securities to a Clearing Agency, in which event
(A) the Trustee has accepted delivery of such Underlying Securities through such
Clearing Agency, and (B) the Underlying Securities have been credited to a trust
account of the Trustee, or its authorized agent, and the Trustee shall have the
right to hold and maintain such Underlying Securities on deposit with such
Clearing Agency for all purposes of this Trust Agreement.
23
(c) Unless otherwise specified in the applicable Series Supplement,
the Grant of such Underlying Securities by the Depositor for a given Series
accomplished hereby and by such Series Supplement is absolute and is intended by
the parties hereto as a sale.
(d) In the case of each delivery of Underlying Securities to the
Trustee, the Depositor shall be deemed thereby to represent and warrant to the
Trustee that:
(i) the Depositor is duly authorized to so deliver
such Underlying Securities;
(ii) the Underlying Securities so delivered are
genuine;
(iii) at the time of delivery of the Underlying Securities, such
Underlying Securities are free and clear of any lien, pledge, encumbrance,
right, charge, claim or other security interest; 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 of a Certificate;
The above representations and warranties shall survive the delivery
of such 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 best of its knowledge, as of the Closing Date, no
default or event of default with respect to the Underlying Securities has
occurred and is continuing.
(e) It is the intention of all of the parties hereto that the
transfer of the Trust Property hereunder and under any Series Supplement shall
constitute a sale and 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.
(f) 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 Trust Property and the issuance of the
Certificates, and other than
24
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 otherwise incur, assume or guarantee any indebtedness for money borrowed.
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 and the related documents referred to in
Section 2.01, now existing or hereafter acquired, and declares that it will hold
such Underlying Securities and documents 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 of Certificates, 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
Series 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 Series Supplement, to the Depositor's
knowledge, the information set forth in the Underlying Security 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 articles 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;
25
(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, 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 Series Supplement.
It is understood and agreed that the representations and warranties
of the Depositor set forth in this Section 2.04(a) shall survive delivery of the
respective documents 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 of Certificates, the Depositor shall cure
such breach in all material respects.
SECTION 2.05. Agreement to Authenticate and Deliver Certificates.
With respect to each Series of Certificates 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 and delivery to it by the
Depositor of executed Certificates and Coupons, if any, of such Series, cause to
be authenticated and delivered to or upon the
26
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 authorized denominations
evidencing ownership of the entire Trust for such Series, all in accordance with
the terms and subject to the conditions of Sections 5.02 and 5.13.
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 Series 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 Series 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
Sub-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
Series Supplement.
(b) The duties of the Trustee shall be performed in accordance with
applicable local, State and Federal law, and the Trustee shall make any and all
filings, reports, notices or applications with, 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 of Certificates, 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.
SECTION 3.03. Certificate Account. (a) For each
Series of Certificates, the Trustee shall establish and maintain
one or more Eligible Accounts (collectively, the "Certificate
27
Account"), held in trust for the benefit of the 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 of
Certificates, the Certificate Account shall be under the sole dominion and
control of the Trustee for the benefit of the related Certificateholders. With
respect to each Series of Certificates, 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 City time, and on the next Business Day otherwise), the
Trustee shall deposit or cause to be deposited in the Certificate Account all
amounts received by it with respect to the Underlying Securities, 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
4.03; and
(vi) any interest or investment income earned on funds deposited
in the related Accounts.
Unless otherwise specified in the applicable Series 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 5 Business Days (or such longer
period, not to exceed 30 calendar days, as to which the Rating Agency Condition
is met) establish a
28
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 and the Rating
Agent of the location of each Eligible Account constituting the Certificate
Account and prior to any change thereof.
SECTION 3.04. Liquidation of the Underlying Securities. If specified
in the applicable Series Supplement, upon the occurrences of specified events,
the Trustee shall direct the Market Agent to sell the Underlying Securities in
compliance with the Sale Procedures and to deposit the Liquidation Proceeds
therefrom into the Certificate Account pursuant to Section 3.03(a) hereof.
SECTION 3.05. Investment of Funds in the Accounts. The Trustee on
behalf of the Trust, may direct any depository institution maintaining the
Certificate Account or the Reserve Account, if any, for the applicable Series
and any other segregated Eligible Account the contents of which are held for the
benefit of Certificateholders of such 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, funds held in any Account
will be invested in the Eligible Investments specified in clause (ii) of the
definition thereof. 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 Series Supplement, any earnings with respect to such Permitted
Investments shall be paid to the Certificateholders (and, if applicable, the
Retained Interest holder) pro rata 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 Trustee shall:
(x) 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
29
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
(y) 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 at funds thereafter on
deposit in any Account.
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 Series Supplement, the Depositor shall, to the
extent specified in the applicable Series Supplement, establish and maintain, or
enter into, as applicable, in the name of the Trustee, either as a 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 Series
Supplement. To the extent specified in the applicable Series Supplement, the
Depositor will make or cause to be made any initial deposit to the Certificate
Account or any Reserve Account for the related Series as of the Closing Date.
Unless the Series 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 includible 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 Series Supplement to the extent that funds are not otherwise
available for such purpose. If specified in such Series 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 Series Supplement.
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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 Series Supplement, if
the Trustee, as applicable, is unable to obtain full recovery in respect of a
defaulted Underlying Security and any 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, (ii) interest accrued but unpaid thereon at the applicable
interest rate and (iii) 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 Series Supplement, the Trust for the applicable Series shall recognize a
Realized Loss equal to the amount of such difference. Any such reimbursed
Realized Loss shall be allocated pursuant to Section 4.05 among the
Certificateholders of such Series in the manner and priority set forth in the
related Series Supplement.
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 Series Supplement as and to the extent specified therein. With
respect to each Underlying Security, unless otherwise specified in the related
Series Supplement, the Retained Interest shall be deducted by the Trustee from
applicable collections in respect of such Underlying Security. Unless otherwise
provided in the applicable Series Supplement, collections in respect of Retained
Interest shall not be deposited in the Certificate Account for the applicable
Series and shall not constitute a part of the Trust for such Series, but shall
instead be distributed to the holder of such Retained Interest; provided,
however, that the Series Supplement for any Series with respect to which there
is a Retained Interest may provide that, notwithstanding the terms contained
herein, commingled amounts received in respect of assets inclusive of
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Underlying Securities and Retained Interest may initially be deposited in a
separate and discrete account established by the Trustee and such Series
Supplement may provide for additional terms relating thereto. Unless otherwise
provided in the applicable Series Supplement, after deduction of all applicable
fees as provided for in this Trust Agreement, on each Distribution Date the
Trustee shall allocate on a pari passu basis any partial recovery on an
Underlying Security between (a) the Retained Interest, if any, and (b)
distributions to Certificateholders of the applicable Series.
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 regarding the
Underlying Securities required by applicable laws and regulations. Such access
shall be afforded without charge, but only upon reasonable request and during
normal business hours at the offices of the Trustee designated by it. In
addition, access to the documentation 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 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:
(a) 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;
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(b) 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
Section 314(e) of the Trust Indenture Act;
(c) transmit to all Certificateholders, in the manner and to the
extent provided in Section 313(c) of the Trust Indenture Act, such
summaries of any information, documents and reports required to be filed
by the Company pursuant to subsections (a) and (b) of this Section 3.10 as
may be required by rules and regulations prescribed by the Commission; and
(d) 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 paragraph (d) 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 Series
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 Series
Supplement.
SECTION 3.11. Charges and Expenses. Except as otherwise provided in
this Trust Agreement or the related Series 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. 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.
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ARTICLE IV
Distributions and Reports to Certificateholders
SECTION 4.01. Distributions. (a) On each Distribution Date for a
given Series of Certificates, the Trustee shall apply Available Funds in the
Certificate Account for such Series in the manner and priority set forth in the
Series Supplement for such Series. In any event, however, any amounts collected
during any period shall be distributed to the Certificateholders no later than
the Distribution Date immediately following the receipt thereof.
(b) All distributions on the Certificates 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 Registered 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 Registered Certificate (or one or more Predecessor Certificates)
is registered at the close of business on the related Record Date
notwithstanding the cancellation of such Registered Certificate upon any
transfer or exchange subsequent to such related Record Date.
The distribution of interest and principal on Registered
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 Certificateholder is not a Depository, at the
Corporate Trust Office (except as otherwise specified pursuant to
Section 5.01) or, at that 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
Section 5.01 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 the
foregoing paragraph, with respect
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to a Certificateholder 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 Certificateholder 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.
In case a Coupon Certificate of any Series (or Class within such
Series) is surrendered in exchange for a Registered Certificate of such Series
or Class after the close of business (at an office or agency in a Place of
Distribution for such Series or Class) on any Record Date and before the opening
of business (at such office or agency) on the next succeeding Distribution Date,
such Coupon Certificate shall be surrendered without the Coupon relating to such
Distribution Date and interest will not be payable on such Distribution Date in
respect of the Registered Certificate issued in exchange for such Coupon
Certificate, but will be distributable only to the Holder of such Coupon when
due in accordance with the provisions of this Trust Agreement.
(b) Interest on any Coupon Certificate that is distributable and is
punctually distributed or duly provided for on any Distribution Date shall be
distributed to the Holder of the Coupon that has matured on such Distribution
Date upon surrender of such Coupon on such Distribution Date at the principal
London office of the Trustee or at such other Place of Distribution outside the
United States specified pursuant to Section 5.01.
Interest on any Bearer Certificate (other than a Coupon Certificate)
that is distributable and is punctually distributed or duly provided for on any
Distribution Date shall be distributed to the Holder of the Bearer Certificate
upon presentation of such Bearer Certificate and notation thereon on such
Distribution Date at the principal London office of the Trustee or at such other
Place of Distribution outside the United States specified pursuant to Section
5.01.
Unless otherwise specified pursuant to Section 5.01, at the
direction of the holder of any Bearer Certificate or Coupon Certificate payable
in Dollars, and subject to applicable laws
35
and regulations, distributions in respect of such Bearer Certificate or Coupon
will be made by check drawn on a bank in The City of New York or, in accordance
with arrangements satisfactory to the Trustee, by wire transfer to a Dollar
account maintained by such Holder with a bank outside the United States. If such
distribution at the offices of the Trustee or all Paying Agents, if any, outside
the United States becomes illegal or is effectively precluded because of the
imposition of exchange controls or similar restrictions on the full distribution
or receipt of such amounts in Dollars, the Depositor will appoint an office or
agent in the United States at which such distribution may be made. Unless
otherwise specified pursuant to Section 5.01, at the direction of the Holder of
any Bearer Certificate or Coupon payable in a Foreign Currency, distributions on
such Bearer Certificate or Coupon will be made by a check drawn on a bank
outside the United States or, in accordance with arrangements satisfactory to
the Trustee, by wire transfer to an appropriate account maintained by such
Holder outside the United States. Except as provided in this paragraph, no
distribution on any Bearer Certificate or Coupon will be made by mail to an
address in the United States or by transfer to an account maintained by the
Holder thereof in the United States.
(c) Subject to the foregoing provisions of this Section 4.02, 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.
(d) 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
Series Supplement applicable to that particular Series or Class of Certificates.
(e) With respect to any computations or calculations to be made
under these Standard Terms, the applicable Series Supplement and the
Certificates, except as otherwise provided, (i) 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, and (ii) all currency amounts will be rounded to the
nearest one-hundredth of a unit (with .005 of a unit being rounded upward).
(f) Unless specified otherwise in a Series Supplement, the final
distribution of principal and/or premium shall be made
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upon presentation and surrender of such Certificates at the
Corporate Trust Office.
SECTION 4.03. Reports to Certificateholders. Unless otherwise
specified in the applicable Series Supplement, on the next Business Day
following each such Distribution Date the Trustee shall forward or cause to be
forwarded to the Depositor, each Certificateholder of such Series, to each
Rating Agency rating such Services and such other Persons as may be specified in
such Series 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 and the Swap Receipt Amount, if any;
(ii) the Swap Distribution Amount, if any, for such
date;
(iii) the amount of the distribution on such Distribution Date to
Certificateholders of each Class of such Series allocable to principal of
and premium, if any, and interest on the Certificates of each such Class;
and the amount of aggregate unpaid interest accrued as of such
Distribution Date;
(iv) 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 Series Supplement;
(v) such other customary information as the Trustee deems
necessary or desirable, (or that any such Certificateholder reasonably
requests,) to enable such Certificateholders to prepare their tax returns;
(vi) if the Series 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 rating assigned by the
37
Rating Agency thereon and the current interest rate or rates thereon at
the close of business on such Distribution Date;
(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;
(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.
In the case of information furnished pursuant to subclauses (iii) and (v) above,
the amounts shall be expressed as a dollar amount (or the equivalent thereof in
any other Specified Currency) per minimum denomination of Certificates or for
such other specified portion thereof. 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 Certificateholder a statement
containing the information set forth in subclauses (iii) and (v) above,
aggregated for such calendar year or the applicable portion thereof during which
such person was a Certificateholder. 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
Certificateholders 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 Series 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 Series Supplement
for a given Series, and subject to the terms of paragraphs (b) and (c) 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
38
related Series 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. The Trustee
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 Series Supplement, as to which
any such unreimbursed 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 Series Supplement for a given Series, any Advances
made in respect of any Underlying Securities related to such Series (or Class
within such Series) that are subsequently 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 Amount 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 of Certificates, the manner and priority of the allocation
of Realized Losses, Administrative Fees, Eligible Expenses, Allowable Expense
Amounts and Extraordinary Trust Expenses, if any, on any Distribution Date among
the Classes, if any, of such Series shall be as set forth in the related Series
Supplement.
SECTION 4.06. Compliance with Withholding
Requirements. (a) Notwithstanding any other provision of this
Trust Agreement to the contrary, the Trustee shall comply with
39
all Federal withholding requirements respecting distributions to
Certificateholders of interest or original issue discount that the Trustee
reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for such withholding.
(b) Each Certificateholder 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 purpose income tax purposes in respect of distributions to
such Certificateholder, 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 Certificateholder 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).
(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
Certificateholder and may be withheld by the Trustee. The consent of
Certificateholder 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 Certificateholder 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 Certificateholder.
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SECTION 4.07. Optional Exchange. (a) The terms and conditions, if
any, upon which Certificates of any Series (or Class within such Series) may be
exchanged for a pro rata portion of the Underlying Securities of the related
Trust will be specified in the related Series Supplement; provided, however,
that any right of 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 the Depositor's and the Trustee's
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" for federal income tax purposes. Such terms may
relate to, but are not limited to, the following:
(1) a requirement that the exchanging Holder tender to the Trustee
Certificates of each Class within such Series;
(2) a minimum Certificate Principal Balance or Notional Amount, as
applicable, with respect to Certificates being tendered for exchange by a
single Holder:
(3) a requirement that the Certificate Principal Balance or National
Amount, as applicable, of each certificate tendered for exchange be an
integral multiple of an amount specified in such Series Supplement;
(4) specified dates during which a Holder may effect such an
exchange (each, an Optional Exchange Date);
(5) limitations on the right of an exchanging Holder to receive any
benefit upon exchange from any Credit Support or Underlying Securities
which are not debt Securities; and
(6) adjustments to the value of the proceeds of any exchange based
upon required prepayment of future expense allocations and the
establishment of a reserve for any anticipated Extraordinary Trust
Expenses.
(b) Unless otherwise provided in the applicable Series Supplement,
no Certificate may be exchanged pursuant to the preceding paragraph unless the
Trustee has received at least 30 days but not more than 45 days prior to an
Optional Exchange Date in accordance with delivery instructions specified in the
applicable Series Supplement (i) such Certificate with the form entitled "Option
to Elect Exchange" on the reverse thereof duly
41
completed, or (ii) in the case of Registered Certificates, 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 of such Registered
Certificate, the Certificate Principal Balance or Notional Amount of such
Registered Certificate to be exchanged and the Certificate number or a
description of the tenor and the terms of such Registered Certificate, a
statement that the option to elect 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 at such telegram, telex, facsimile transmission or letter, and
such Registered Certificate and form duly completed must be received by such
Trustee by such fifth Business Day. Any tender of a Certificate by the Holder
thereof for exchange shall be irrevocable. Unless otherwise provided in the
applicable Series Supplement, the exchange option may be exercised pursuant to
this Section by the Holder of a Certificate for less than the Certificate
Principal Balance or Notional Amount of such Certificate as long as the
Certificate Principal Balance or National Amount remaining Outstanding after
such exchange is an authorized denomination and all other exchange requirements
set forth in the related Series Supplement are satisfied upon such partial
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, in the case of any Registered Certificate, 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.
ARTICLE V
The Certificates
SECTION 5.01. The Certificates. (a) The Certificates of any Series
(or Class within such Series) may be issued in (x) fully registered form as
Registered Certificates or (y) bearer form with or without Coupons as Bearer
Certificates, and shall be substantially in the form of the exhibits with
respect thereto attached to the applicable Series Supplement.
42
The Certificates may be issued in one or more Series, each of which
series may, subject to the provisions of the Code and the intended status of
each Series Trust to constitute a fixed investment trust for federal income tax
purposes, 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 and Coupon shall bear upon its face the designation so selected
for the Series and Class to which it belongs. All Certificates and all Coupons
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 Series Supplement. Except as otherwise provided in a Series
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.
(b) Each Series (and all Classes within such Series) of Certificates
shall be created by a Series Supplement authorized by the Depositor and
establishing the terms and provisions of such Series. The several Series may,
subject to the provisions of the Code and the intended status of each Series
Trust to constitute a fixed investment trust for federal income tax purposes,
differ as between Series and any given Class may vary as between the other
Classes within any given Series.
SECTION 5.02. Execution, Authentication and Delivery. (a) The
Certificates and the Coupons, if any, shall be executed by the Depositor by its
President, its Treasurer, or one of its Vice Presidents, under its corporate
seal, which may be in facsimile form and imprinted or otherwise reproduced
thereon and shall be attested by its Secretary or one of its Assistant
Secretaries. The signature of any of these officers may be manual or facsimile.
Certificates and Coupons bearing the manual or facsimile signature of individual
who were at any time the proper officers of the Depositor shall be binding,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates or Coupons
or did not hold such offices at the date of such Certificates and Coupons.
43
(b) Each Certificate shall be dated as of the later of the date
specified in the related Series Supplement and the date of its authentication.
(c) No Certificate or Coupon appertaining thereto 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 authorized signatories, and
such certificate upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate (and any Coupons appertaining thereto) has been
duly authenticated and delivered hereunder and is entitled to the benefits of
this Trust Agreement. Except as permitted by Section 5.04, 5.05 or 5.06, the
Trustee shall not authenticate and deliver any Bearer Certificate unless all
appurtenant Coupons then matured have been detached and cancelled.
SECTION 5.03. Temporary Certificates. Pending the preparation of
Definitive Certificates of any Series (or Class within each such Series), the
Depositor may execute, and upon receipt of a Depositor Order, the Trustee shall
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 in lieu of which they
are issued, in registered form or, if authorized, in bearer form with one or
more Coupons or without Coupons, 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 by the Depositor and
shall be authenticated and delivered by the Trustee upon the same conditions and
in substantially the same manner, and with the same effect, as the Definitive
Certificate or Definitive Certificates in lieu of which is issued.
If temporary Certificates of any Series (or Class within such
Series) are issued, the Depositor will cause Definitive Certificates of such
Series or Class to be prepared without unreasonable delay. Except as otherwise
specified in the applicable Series Supplement with respect to a Series (or Class
within such Series) of Certificates issuable as Bearer Certificates or as one or
more Global Securities representing individual Bearer Certificates of such
Series or Class, (a) after the preparation of Definitive Certificates of such
Series or
44
Class, the temporary Certificates of such Series or Class shall be exchangeable
for Definitive Certificates of such Series or Class upon surrender of the
temporary Certificates of such Series or Class at the office of the Trustee in a
Place of Distribution for such Series or Class, without charge to the Holder,
except as provided in Section 5.04 in connection with a transfer and except that
a Person receiving definitive Bearer Certificates shall bear the cost of
insurance, postage, transportation and the like unless otherwise specified in
the applicable Series Supplement, and (b) upon surrender for cancellation of any
one or more temporary Certificates of any Series or Class within such Series
(accompanied by any unmatured Coupons appertaining thereto), the Depositor shall
execute and the Trustees shall authenticate and deliver in exchange therefore
Definitive Certificates with a like Certificate Principal Balance or Notional
Amount, as applicable, of the same Series (or Class within such Series) of
authorized denominations and of like tenor; provided, however, that no
definitive Bearer Certificate shall be delivered in exchange for a temporary
Registered Certificate; and provided, further, that delivery of a Global
Security representing individual Bearer Certificates or a Bearer Certificate
shall occur only outside the United States. 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 of such Series or Class, except as otherwise specified in the
applicable Series Supplement with respect to the payment of interest on Global
Securities in temporary form.
Unless otherwise specified pursuant to Section 5.01, the Depositor
will execute and deliver individual Bearer Certificates in exchange for
beneficial interests in the definitive Global Security and each Bearer
Certificate to the Trustee's principal office in London or to an authorized
agent at such other place outside the United States specified pursuant to
Section 5.01.
Upon any exchange of a portion of a temporary Global Security for a
definitive Global Security or for the individual Definitive Certificates
represented thereby pursuant to this Section 5.03 or Section 5.04, 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.
45
SECTION 5.04. Registration; Registration of Transfer and Exchange.
(a) The Trustee shall cause to be kept a register for each Series of Registered
Certificates (the registers maintained in such office and in any other office or
agency of the Trustee in a Place of Distribution 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 Registered Certificates and the
registration of transfers and exchanges of Registered Certificates. The Trustee
is hereby initially appointed Certificate Registrar for the purpose of
registering Registered Certificates and transfers and exchanges of Registered
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 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 of the Registered Certificates and the principal amounts and numbers of
such Registered Certificates.
(b) Upon surrender for registration of transfer any Registered
Certificate of any Series (or Class within such Series) at the office or agency
of the Trustee, if the requirements of Section 8-401(1) of the Uniform
Commercial Code are met to the Depositor's satisfaction, the Depositor shall
execute, and the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Registered Certificates of
any authorized denominations, of a like Series, Class and aggregate Certificate
Principal Balance or Notional Amount, as applicable. Except as otherwise
specified pursuant to Section 5.01, in no event may Registered Certificates,
including Registered Certificates received in exchange for Bearer Certificates,
be exchanged for Bearer Certificates.
(c) Notwithstanding any other provisions of this Section, 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
46
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, Registered Certificates of any
Series (or Class within such Series) (other than a Global Security, except as
set forth below) may be exchanged for other Registered Certificates of the same
Series or Class of any authorized denomination or denominations of like tenor
and aggregate Certificate Principal Balance or Notional Amount, as applicable,
upon surrender of the Registered Certificates to be exchanged at the office or
agency of the Trustee maintained for such purpose.
(e) At the option of the Holder, except as otherwise specified as
contemplated by Section 5.01 with respect to a Global Security representing
Bearer Certificates, Bearer Certificates of any Series (or Class within such
Series) may be exchanged for Registered Certificates (if the Certificates of
such Series or Class are issuable as Registered Certificates) or Bearer
Certificates of the same Series or Class, of any authorized denomination or
denominations, of like tenor and aggregate Certificate Principal Balance or
Notional Amount, as applicable, upon surrender of the Bearer Certificates to be
exchanged at the office or agency of the Trustee maintained for such purpose,
with all unmatured Coupons and all matured Coupons in default thereto
appertaining; provided, however, that delivery of a Bearer Certificate shall
occur only outside the United States. If the Holder of a Bearer Certificate is
unable to produce any such unmatured Coupon or Coupons or matured Coupon or
Coupons in default, such exchange may be effected if the Bearer Certificates are
accompanied by payment in funds acceptable to the Depositor and the Trustee in
an amount equal to the face amount of such missing Coupon or Coupons, or the
surrender of such missing Coupon or Coupons may be waived by the Depositor and
the Trustee if there be furnished to each of them such security or indemnity as
they may require to save each of them and any Paying Agent harmless. If
thereafter the Holder of such Bearer Certificate shall surrender for payment any
such missing Coupon in respect of which such a payment shall have been made,
such Holder shall be entitled to receive the amount of such payment; provided,
however, that, except as otherwise provided in Section 5.06, interest
represented by Coupons shall be payable only upon presentation and surrender of
those Coupons at an office or agency located outside the United States.
47
Whenever any Certificates are so surrendered for exchange, the
Depositor shall execute and the Trustee shall authenticate and deliver the
Certificates that the Holder making the exchange is entitled to receive.
Notwithstanding the foregoing, the exchange of Bearer Certificates
for Registered Certificates will be subject to the provisions of United States
income tax laws and regulations applicable to Certificates in effect at the time
of such exchange.
(f) If at the time the Depository for the Certificates of a Series
(or Class within such Series) notifies the Depositor that it is unwilling or
unable to continue as Depository for the Certificates of such Series or Class or
if at any time the Depository for the Certificates of such Series or Class shall
no longer be eligible under Section 5.08(b), the Depositor shall appoint a
successor Depository with respect to the Certificates of such Series or Class.
If a successor Depository for the Certificates of such Series or Class is not
appointed by the Depositor within 90 days after the Depositor receives such
notice or becomes aware of such ineligibility, the Depositor's election pursuant
to Section 5.01 shall no longer be effective with respect to the Certificates of
such Series or Class and the Depositor will execute, and the Trustee, upon
receipt of a Depositor Order for the authentication and delivery of individual
Certificates of such Series or Class, will authenticate and deliver individual
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.
(g) The Depositor may at any time and in its sole discretion
determine that individual Certificates of any Series (or Class within such
Series) issued in the form of one or more Global Securities shall no longer be
represented by such Global Security or Securities. In such event the Depositor
shall execute, and the Trustee, upon receipt of a Depositor Order for the
authentication and delivery of individual Certificates of such Series or Class,
shall authenticate and deliver, individual 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.
48
(h) If specified by the Depositor pursuant to Section 5.01 with
respect to a Series (or Class within such Series) of Certificates, the
Depository for such Series may surrender a Global Security for such Series or
Class in exchange in whole or in part for individual Certificates of such Series
or Class on such terms as are acceptable to the Depositor and such Depository.
Thereupon, the Depositor shall execute, and the Trustee, upon receipt of a
Depositor Order, shall authenticate and deliver, without service charge,
(i) to each Person specified by such Depository 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 a 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 in any of the preceding three
paragraphs, the Depositor shall execute, and the Trustee, upon receipt of a
Depositor Order, will authenticate and deliver individual Certificates (a) in
registered form in authorized denominations, if the Certificates of such Series
or Class are issuable as Registered Certificates, (b) in bearer form in
authorized denominations, with or without Coupons attached, if the Certificates
of such Series or Class are issuable as Bearer Certificates or (c) as either
Registered or Bearer Certificates, if the Certificates of such Series or Class
are issuable in either form; provided, however, that individual Bearer
Certificates shall be delivered in exchange for a Global Security only in
accordance with the procedures specified pursuant to Section 5.01.
Upon the exchange of a Global Security for individual Certificates,
such Global Security shall be cancelled by the Trustee. Individual Registered
Certificates issued in exchange for a Global Security pursuant to this Section
5.04 shall be registered in such names and in such authorized denominations as
the Depository for such Global Security, pursuant to instructions from its
Participants, any indirect participants or otherwise,
49
shall instruct the Trustee. The Trustee shall deliver such Registered
Certificates to the Person in whose names such Registered Certificates are so
registered. The Trustee shall deliver individual Bearer Certificates issued in
exchange for a Global Security pursuant to this Section 5.04 to the Persons and
in such authorized denominations as the Depository for such Global Security,
pursuant to instructions from its Participants, any indirect participants or
otherwise, shall instruct the Trustee; provided, however, that individual Bearer
Certificates shall be delivered in exchange for a Global Security only in
accordance with the procedures as may be specified pursuant to Section 5.01.
Notwithstanding the foregoing, the exchange of Bearer Certificates
for Registered Certificates will be subject to the provisions of United States
income tax laws and regulations applicable to Certificates in effect at the time
of such exchange.
(i) 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.
(j) Every Registered 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).
(k) No service charge shall be made to a Holder for any registration
of transfer or exchange of Certificates, but the Depositor 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.
50
SECTION 5.05. Mutilated, Destroyed, Lost and Stolen Certificates. If
(i) any mutilated Certificate or any mutilated Coupon with the Coupon
Certificate to which it appertains (and all unmatured Coupons attached thereto)
is surrendered to the Trustee at its Corporate Trust Office (in the case of
Registered Certificates) or at its principal London office (in the case of
Bearer Certificates) or (ii) the Depositor and the Trustee receive evidence to
their satisfaction of the destruction, loss or theft of any Certificate or any
Coupon, 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 or Coupon 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 or in exchange for the Coupon
Certificate to which such mutilated, destroyed lost or stolen Coupon
appertained, a new Certificate of the same Series or Class of like tenor, form,
terms and principal amount, bearing a number not contemporaneously Outstanding,
and, in the case of a Coupon Certificate, with such Coupons attached thereto so
that neither gain nor loss in interest shall result from such exchange or
substitution.
Upon the issuance of any new Certificate under this Section, the
Depositor may require the payment of a sum sufficient to cover any tax or other
governmental charge 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, with its Coupons, if
any, issued pursuant to this Section shall constitute complete and indefeasible
evidence of ownership in the Trust related to such Series, whether or not the
destroyed, lost or stolen Certificate or Coupon 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 and their Coupons, if any, duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Certificates or Coupons.
SECTION 5.06. Persons Deemed Owners. (a) The
Depositor, the Trustee and any agent of the Depositor or the
51
Trustee may treat the Person in whose name any Registered Certificate is
registered as the owner of such Registered 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 Registered Certificate and for all other
purposes whatsoever, whether or not such Registered Certificate be overdue, and
neither the Depositor or the Trustee, nor any agent of the Depositor or the
Trustee shall be affected by notice to the contrary.
(b) The Depositor, the Trustee and any agent of the Depositor or the
Trustee may treat the Holder of any Bearer Certificate or of any Coupon as the
absolute owner of such Bearer Certificate or Coupon for the purposes of
receiving distributions thereof or on account thereof and for all other purposes
whatsoever, whether or not such Bearer Certificate or Coupon be overdue, and
neither the Depositor, the Trustee, nor any agent of the Depositor or the
Trustee shall be affected by notice to the contrary. All distributions made to
any Holder, or upon his order, shall be valid, and, to the extent of the sum or
sums paid, effectual to satisfy and discharge the liability for moneys
distributable upon such Certificate or Coupon.
(c) None of the Depositor, the Trustee or any of their agents will
have any responsibility or liability for any aspect of the records relating to
or distributions made on account of beneficial ownership interests in a Global
Security or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
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 and all Coupons surrendered for
payment or exchange shall, if surrendered to any Person other than the Trustee,
be delivered to the Trustee and shall be promptly cancelled by it. No
Certificates or Coupons shall be authenticated in lieu of or in exchange for any
Certificates or Coupons cancelled as provided in this Section, except as
expressly permitted by this Trust Agreement.
SECTION 5.08. Global Securities. (a) If the Series Supplement
pursuant to Section 5.01 provides that a Series (or Class within such Series) of
Certificates shall be represented by one or more Global Securities, then the
Depositor shall execute and the Trustee shall authenticate and deliver one or
more Global Securities, then the Depositor shall execute and the Trustee shall
authenticate and deliver one or more Global Securities that
52
(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, if in registered form, 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 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 or by the Depository or any such nominee to a
successor Depository or a nominee of such successor Depository.
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 5.11. Unless and until
definitive, fully registered Certificates (the "Definitive Certificates") have
been issued to Holders of such Series or Class pursuant to Section 5.11:
(i) the provisions of this Section 5.09 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 owners of beneficial interests in such Series or Class
(collectively, the "Certificate Owners");
(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 Certificate 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
Certificate Owners and the Depository or its Participants;
53
(v) whenever this Trust Agreement requires or permits
actions to be taken based upon instructions or directions of Holders
of Certificates of such Series or Class evidencing a specified
percentage of the aggregate Voting Rights of such 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
Certificate 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.
(b) Each Depository designated pursuant to Section 5.01 for a Global
Security in registered form 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 Certificate 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 Certificate Owners.
SECTION 5.10. Definitive Certificates. If in respect of a Series (or
Class within such Series) represented by one or more Global Securities (i) the
Depositor advises the Trustee 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 is unable to locate a
qualified successor, (ii) the Depositor at its option advises the Trustee in
writing that it elects to terminate the book-entry system of such Series or
Class through the Depository or (iii) Certificate Owners representing beneficial
interests aggregating at least a majority (or such other Required
Percentage--Definitive Certificates that may be specified in a Series
Supplement) of the Voting Rights of the Certificates of such Series or Class
advise the Depository in writing that the continuation of a book-entry system
for such Series or Class through the Depository is no longer in the best
interests of the Certificates Owners of such Series or Class, then the
Depository
54
shall notify all Certificate 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 Certificates for such Series or
Class to Certificate 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
Depositor shall execute and the Trustee shall authenticate the Definitive
Certificates of such Series or Class in accordance with the instructions of the
Depository. None of the Depositor, the Certificate Registrar or the Trustee
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 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.
SECTION 5.11. Currency of Distributions in Respect of Certificates.
(a) Except as otherwise specified pursuant to Section 5.01 for Bearer
Certificates of any Series (or Class within such Series), distributions of the
principal of (and premium, if any) and interest on Bearer Certificates of such
Series or Class denominated in any Currency will be made in such Currency.
(b) Except as otherwise specified pursuant to Section 5.01 for
Registered Certificates of any Series (or Class within such Series),
distributions of the principal of (and premium, if any) and interest on
Registered Certificates of such Series or Class will be made in Dollars.
(c) For purposes of any provision of the Trust Agreement where the
Holders of Outstanding Certificates may perform an act that requires that a
specified percentage of the aggregate Voting Rights of the Certificates of all
Series perform such act and for purposes of any decision or determination by the
Trustee of amounts due and not distributed for the principal of (and premium, if
any) and interest on the Certificates of all Series in respect of which moneys
are to be disbursed ratably, the principal of (and premium, if any) or notional
amount of, as applicable, and interest on the Outstanding Certificates
denominated in a Foreign Currency will be the amount in Dollars based upon
exchange rates, determined as specified pursuant to Section 5.01 for
Certificates of such Series, as of the date for determining whether the Holders
entitled to perform such act have
55
performed it or as of the date of such decision or determination
by the Trustee, as the case may be.
(d) With respect to Certificates of any Series, any decision or
determination to be made regarding exchange rates shall be made by an Exchange
Rate Agent appointed by the Depositor; 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, in the opinion of the
Depositor at the time of such appointment, require such Exchange Rate Agent to
make such determination by a method provided in the applicable Series Supplement
for the making of such decision 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 the Certificates of such Series.
(e) If distributions in respect of a Certificate are required to 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
Certificate shall be made in Dollars until such Specified Currency is again so
used in the manner specified in the related Series Supplement.
SECTION 5.12. Conditions of Authentication and Delivery of New
Series. 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
Series Supplement. The Depositor shall execute and deliver Certificates of such
Series to the Trustee, with appropriate Coupons, if any, appertaining thereto,
and the Trustee shall authenticate and deliver such Certificates upon a
Depositor Order and upon delivery by the Depositor to the Trustee of the
following:
(1) The delivery of the Underlying Securities in
accordance with Section 2.01(b);
(2) Opinions of counsel to the Depositor, addressed to the
Trustee, in a form acceptable to the Trustee;
56
(3) 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 issuance
of 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 or
bylaws, 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;
(4) A Series Supplement consistent with the applicable provisions
of these Standard Terms;
(5) If applicable, a fully executed copy of the Swap Agreement,
together with all documents and opinions required to be
delivered to the Trust upon execution thereof pursuant to the
terms thereof;
(6) Written instructions by the Depositor to the Trustee directing
the Trustee to enter into and perform any obligations under
the Swap Agreement, if applicable, and/or the Market Agent
Agreement, if applicable.
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 Certificate 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.
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
57
Certificateholders of such Series from the Certificate Account for such Series
pursuant to the provisions of the applicable Series 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. 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. 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 Certificate- holders 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
Section 317(b) of the Trust Indenture Act. 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
58
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. 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 Section 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:
"This is one of the Certificates described in the
Standard Terms and the related Series Supplement.
Dated:
------------------------------
------------------------------
as Authenticating Agent
for the Trustee,
59
By "
------------------------------
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
("voting rights") by, owners of any of the Underlying Securities, the Trustee
shall give notice to the Certificateholders, setting forth (i) such information
as is contained in such notice to owners of Underlying Securities, (ii) a
statement that the Certificateholders will be entitled, subject to any
applicable provision of law and any applicable provisions of such Underlying
Securities (and to the extent of the voting rights allocated to the
Certificateholders pursuant to subsection 5.15(b)), 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
Certificateholders of record on such Record Date.
Upon the written request of the applicable Certificateholder,
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 (in each case to the extent of the
voting rights allocated pursuant to subsection 3.07(b) to such
Certificateholder). The Trustee shall not vote except as specifically authorized
and directed in written instructions from the applicable Certificateholder
entitled to give such instructions.
(b) Unless otherwise specified in the applicable Series Supplement,
the voting rights allocable to the owners of the Underlying Securities pursuant
to the terms thereof shall be allocated among the Certificateholders pro rata,
in the proportion that the denomination of each Certificate bears to the
aggregate denomination of all Certificates.
(c) 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 Certificateholder
agrees so long as it is an owner of such Certificate that it shall not grant any
60
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 Certificateholder or (ii) to any redemption or prepayment of the
Underlying Securities underlying the Certificates held by such
Certificateholder. 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
Certificateholder 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 Trustee in reliance thereon,
whether or not notation of such action is made upon such Certificate.
(d) Certificateholders of Certificates 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
Issuer(s). Such Certificateholders are not required to join other
Certificateholders of Certificates, the Depositor or the Trustee in order to
proceed against the Issuer(s).
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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 Series 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, entitled and empowered to institute any
suits, actions or 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 claim or 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, however, that:
(1) 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;
(2) the Trustee shall not determine that the action so directed
would be unjustly prejudicial to the Holders of Certificates of such Class
not taking part in such direction;
(3) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
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SECTION 5.20. Waiver of Past Defaults. The Holders of the Required
Percentage--Waiver of Certificates of any Series may 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 Event of Default thereunder with
respect to such Series of Certificates and its consequences or may instruct the
Trustee to waive any past default under this Trust Agreement and its
consequences, except a default:
(1) in the payment of the principal of or premium, if
any, or interest on the Underlying Securities;
(2) in respect of a covenant or provision hereof which under Article
VIII hereof cannot be modified or amended without the consent of the
Holder of each Outstanding Certificate affected; or
(3) specified in the applicable Series Supplement, if any, unless
the applicable Series Supplement provides otherwise.
Upon any such direction, the Trustee shall vote such percentage of
the Underlying Securities of the corresponding Series held by the Trustee as
corresponds to the percentage of the aggregate Principal Amount of the
Outstanding Certificates of such Series held by Holders who directed the Trustee
to waive such default or Event of Default thereunder. Upon any waiver that is
effective under the terms of such Class of Underlying Securities to waive such
default or Event of Default, such default or Event of Default shall cease to
exist with respect to this Trust Agreement, and, in the case of a default, 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 Certificateholders or in respect of any Underlying Securities 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, Special Payment Date or other date specified
63
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. (a) The Depositor shall be
liable in accordance herewith only to the extent of the obligations specifically
imposed by these Standard Terms and the related Series 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 Series Supplement or in the exercise of any of its rights or power 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
64
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, any 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 Calculation Agent, the Market
Agent or the other party 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 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
65
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 transfers 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
Issuer(s). (a) The sole obligor with respect to any Underlying Security is the
Issuer thereof. 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 Issuer of
any Underlying Security in the event of a default or to assert the rights and
privileges of Certificateholders of Certificates and has no duty in respect
thereof.
ARTICLE VII
Concerning 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 Series Supplement. The Trustee shall exercise
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 man would
exercise or use under the circumstances in the conduct of such person's own
affairs. 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. The Trustee shall not have any power to vary the
66
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 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 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; and
(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
67
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 Series 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 a 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 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 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 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 Calculation
Agent, the Market Agent
68
or the other party to this Trust Agreement. The Trustee 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;
(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 action, suit or other proceeding in respect of any
Underlying Securities;
(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 shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in reliance thereon, unless the
Trustee's taking, suffering or omitting such action shall have been
willful misconduct, in bad faith or negligent.
(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
69
Section 313(c) of the Trust Indenture Act, notice of such default hereunder
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 determine 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, 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
the applicants 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
applicants propose to transmit, and by reasonable proof that each such applicant
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 applicants access to all
information so furnished to or received by the Trustee; or
(ii) inform such applicants 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 applicants access to such
information, the Trustee shall, upon the written request of such applicants,
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 file periodic reports pursuant to the
Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder, in accordance with the customary practices of the
Depositor. The Depositor will respond
70
reasonably promptly to any inquiry of the Trustee as to such
customary practices of the Depositor.
SECTION 7.02. Between Trustee and Sub-Administrative Agents. (a)
Unless otherwise provided in a Series Supplement, the Trustee may enter into
Sub-Administration Agreements with one or more Sub-Administrative Agents in
order to delegate certain of its administrative obligations with respect to a
related Series under this Trust Agreement to such Sub-Administrative Agents;
provided, however, that (i) such delegation shall not release the Trustee from
the duties, obligations, responsibilities or liabilities arising under this
Trust Agreement; (ii) the Rating Agency Condition shall have been satisfied with
respect to the entering into of any such agreement and (iii) such agreements are
consistent with the terms of these Standard Terms and, with respect to
Certificates of any Series, the related Series Supplement. With respect to any
Series (or Class within such Series) of Certificates, each Sub-Administration
Agreement shall impose on the Sub-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 Sub-Administration
Agreement may be provided in the applicable Series Supplement. The Trustee shall
deliver to the Depositor copies of all Sub-Administration Agreements which it
enters into, and any amendments or modifications thereof, promptly upon the
Trustee's execution and delivery of any such instruments.
(b) The Trustee shall be entitled to terminate any
Sub-Administration Agreement which it enters into and the rights and obligations
of any Sub-Administrative Agent under any Sub- Administration Agreement in
accordance with the terms and conditions of any such Sub-Administration
Agreement. In the event of a termination of any Sub-Administration Agreement,
the Trustee shall simultaneously reassume direct responsibility for all
obligations delegated in such Sub-Administration Agreement without any act or
deed on the part of the applicable Sub- Administrative Agent, the Trustee shall
administer directly the related Underlying Securities or shall enter into a Sub-
Administration Agreement with a successor Sub-Administrative Agent which so
qualifies under Section 7.02.
(c) Unless otherwise provided in the applicable Series Supplements,
in the event a Sub-Administrative Agent is administering one or more Underlying
Securities pursuant to a Sub-Administration Agreement, the Sub-Administrative
Agent shall
71
be required immediately to direct the Trustee to deposit into an Eligible
Account established by such Sub-Administrative Agent (a "Sub-Administration
Account") any amounts collected with respect thereto, and all such amounts shall
be deposited into the related Certificate Account not later than the Business
Day after receipt thereof.
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, 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, 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
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Classes within any such Series), as specified by the applicable Series
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
(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 at the direction of the Depositor pursuant to 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 suit, action or 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.
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
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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, the
Trustee's interest shall be excluded.
SECTION 7.06. Trustee's Fees and Expenses. (a) The
applicable Series 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 Series
Supplement is greater than zero, the Trustee acknowledges that the Depositor has
paid to the Trustee an amount equal to the Prepaid Ordinary Expenses, and the
Trustee agrees that the payment of such amount shall constitute full and final
satisfaction of and payment for all Ordinary Expenses.
(c) If the Prepaid Ordinary Expenses set forth in the Series
Supplement is zero, the Series 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 or the Retained Interest at the rate or amount and
on the terms provided for in the Series Supplement. 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 Series
Supplement is zero, the Series 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 Series Supplement payable at the times set forth
therein. 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 9.01 hereof.
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(e) Subject to subsection 7.06(f), all Extraordinary 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 and
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 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 the Required Percentage--Remedies of the aggregate
principal amount of Certificates then outstanding, and (iii) the
Certificateholders, pursuant to the instructions given under clause (ii) above,
have agreed that such costs, expenses or liabilities shall either be (x) paid by
the Trustee from the Trust, in the case of a vote of 100% of the aggregate
principal amount of Certificates then outstanding, or (y) paid by the Trustee
(which payment shall be made out of its own funds and not from monies on deposit
in the Trust) in which case the Trustee shall be entitled to receive, upon
demand, reimbursement from those Certificateholders who have agreed to bear the
entire amount of such costs, expenses or liabilities, on a pro rata basis among
such Certificateholders.
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 eligible to act as a trustee under Section 310(a) of
the Trust Indenture Act, having a combined capital and surplus of at least
$50,000,000 and subject to supervision or examination by Federal or State
authority. 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 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. Such corporation or association must be rated in one of
the four highest rating categories by the Rating Agency. In the event that at
any time such Trustee shall cease to be eligible in accordance with the
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provisions of this Section, 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
with respect to any Class of Certificates under Section 310(b) of the Trust
Indenture Act and this Section, 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 (a) assist the
Depositor in finding a successor Trustee acceptable to the Depositor and (b)
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
7.04 hereof, and such removal shall take effect upon the appointment of the
successor trustee and its acceptance of such appointment as provided in the
succeeding paragraph; 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 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
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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 ninety (90) 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 90 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 Underlying Securities and parts thereof to such
successor. Any successor Trustee shall promptly give notice of its appointment
to the Certificateholders of Certificates for which it is successor Trustee in
the manner provided in Section 7.04 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.
SECTION 7.09. Appointment of Office or Agency. As specified in a
Series 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
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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 Series 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 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
78
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 legal action relating to this Trust Agreement or the Certificates or
the performance of any of the Trustee's duties hereunder, other than any loss,
liability or expense (i) that constitutes a specific liability of the Trustee
under this Trust Agreement or (ii) 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
or as a result of a breach of the Trustee's obligations and duties hereunder.
(b) If the indemnification provided for in the preceding paragraph
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
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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 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
80
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 shall survive the
termination or discharge of this Trust Agreement.
SECTION 7.12. Indemnification of Depositor by Trustee. The Trustee,
in its individual capacity and not from the assets of the Trust, shall indemnify
the Depositor and any successor trustee against any losses, claims, damages,
expenses (including without limitation the Depositor's costs and expenses in
defending itself against any losses, claims or investigations of any nature
whatsoever) or other liabilities, joint or several, which may arise out of acts
performed or omitted by the Trustee or its agents due to its or their
negligence, bad faith or willful misconduct.
SECTION 7.13. No Liability of the Trustee with Respect to the
Underlying Securities; Certificateholders to Proceed Directly Against the
Issuer(s). (a) The sole obligor with respect to any Underlying Security is the
Issuer thereof. 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 Issuer of
any Underlying Security in the event of a default or to assert the rights and
privileges of Certificateholders of Certificates and has no duty in respect
thereof except as expressly provided herein.
SECTION 7.14. The Depositor To Furnish Trustee with Names and
Addresses of Certificateholders. The Depositor will furnish to the Trustee
within 15 days after each 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;
81
provided, however, that so long as the Trustee is the sole Registrar, no such
list need be furnished.
SECTION 7.15. 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 7.16. Reports by Trustee. If required, within 60 days after
May 15 of each year, commencing with the year 1996, the Trustee shall transmit
to the Certificateholders, as provided in Section 313(c) of the Trust Indenture
Act, a brief report dated as of such May 15, if required by Section 313(a) of
the Trust Indenture Act.
SECTION 7.17. 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 are not set forth reasonably clearly in these
Standard Terms and the related Series 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 an officer of the Depositor actually receives such application, unless any
such 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.
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ARTICLE VIII
Market Agent
SECTION 8.01. Market Agent. (a) If specified for a specific Series,
on the Closing Date the Trustee shall enter into a Market Agent Agreement with
Xxxxxx Brothers Inc., as the initial Market Agent, in the form attached to the
related Series 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 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 Trustee 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
Termination
SECTION 9.01. 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 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 the trust created hereby
continue beyond the expiration of 21 years from the death of the last survivor
of the descendants of
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Xxxxxx X. Xxxxxxx, the late ambassador of the United States to the Court of St.
Xxxxx, living on the date hereof.
(b) Written notice of any termination shall be provided as set forth
in Section 10.05.
(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 9.01(a), 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 Series 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 9.01 and Section 4.01 hereof. Immediately following
the deposit of funds in trust hereunder, the Trust for such Series shall
terminate.
ARTICLE X
Miscellaneous Provisions
SECTION 10.01. Amendment. (a) This Trust Agreement may be amended
from time to time by the Depositor and the Trustee without the consent of any of
the Certificateholders for any of the following purposes: (i) to cure any
ambiguity or to correct or supplement any provision herein which may be
defective or inconsistent with any other provision herein or to provide for any
other terms or modify any other provisions with respect to matters or questions
arising under this Trust Agreement which shall not adversely affect the
interests of the Holders in any material respect; or (ii) to evidence and
provide for the acceptance of appointment hereunder of a change in Trustee as
Trustee for a Series of Certificates subsequent to the Closing Date for such
Series, and to add to or change any of the provisions of this Trust Agreement as
shall be necessary to provide for or facilitate the administration of the
separate Trusts hereunder by more than one trustee, pursuant to the requirements
of Section 5.01 hereof; or (iii) to evidence and provide for the acceptance of
appointment hereunder by a
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successor Trustee with respect to the Certificate of one or more Series or to
add or change any of the provisions of this Trust Agreement as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder; or (iv) to provide for the issuance of a new Series of Certificates
pursuant to a Series Supplement issued hereunder pursuant to Sections 5.01 and
5.12 hereof; provided, however, that in the case of any amendment the Rating
Agency Condition shall be satisfied with respect to such amendment and that no
such amendment shall cause any Trust created hereunder to fail to qualify as a
fixed investment trust for federal income tax purposes.
(b) Without limiting the generality of the foregoing, with respect
to any Series this Trust Agreement may also be modified or amended from time to
time by the Depositor and the Trustee with the consent of the Holders of
Certificates representing the Required Percentage--Amendment of the aggregate
Voting Rights of those Certificates to which such modification or amendment
relates for the purpose of adding any provisions 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) adversely affect in any material respect the interests of the
Holders of any Series (or Class within such Series) of Certificates in a manner
other than as described in (i), without the consent of the Holders of
Certificates of such Series or Class evidencing not less than the Required
Percentage-- Amendment of the aggregate Voting Rights of such Series or Class or
(iii) reduce the percentage of aggregate Voting Rights required by (ii), as
described in (ii), without the consent of the Holders of all Certificates of
such Series or Class then Outstanding.
Notwithstanding any other provision of this Trust Agreement, for
purposes of the giving or withholding of consents pursuant to this Section
10.01, Certificates registered in the name of the Depositor or the Trustee or
any affiliate thereof shall be entitled to Voting Rights with respect to matters
affecting such Certificates; and provided, further, that in the event the Rating
Agency Condition is not satisfied with respect to such modification or
amendment, the Required Percentage--Amendment shall be increased to require an
aggregate percentage of the aggregate Voting Rights in the amount specified in
the applicable Series Supplement. Notwithstanding any other provision of this
Trust Agreement, this Section 10.02(b) shall
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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 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 10.02. 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 then.
(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 pursuant to any provision
hereof.
(c) No Certificateholder of a given Series shall have any right by
virtue of any provision of this Trust Agreement to institute any suit, action or
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 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 action, suit or
proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs,
86
expenses and liabilities to be incurred therein or thereby, (iii) 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 action, suit or
proceeding, and (iv) 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 litigation 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, each and every Certificateholder and the Trustee shall be entitled to
such relief as can be given either at law or in equity.
SECTION 10.03. GOVERNING LAW. THIS TRUST AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE
TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY THE STATE OF NEW YORK AND
WITHOUT GIVING EFFECT TO SUCH STATE'S PRINCIPLES OF CONFLICTS OF LAW TO THE
EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE
REQUIRED THEREBY, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 10.04. Notices. (a) All directions, demands
and notices hereunder shall be in writing and shall be delivered
as set forth in the applicable Series Supplement.
(b) Any notice required to be provided to a Holder of a Registered
Certificate 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
87
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 notice required to be given to a holder of a Bearer
Certificate or Coupon shall be published in an Authorized Newspaper or
Newspapers in such Place or Places of Distribution as may be specified for a
given Series in the applicable Series Supplement, and such notice shall be
deemed sufficient if published on two separate Business Days within two Business
Days of the time prescribed in this Trust Agreement.
(d) 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 0
Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxx Xxxx, through
facsimile transmission number (000) 000-0000, telephone confirmation number
(000) 000-0000. The Depositor may change this information by written notice to
the Trustee.
(e) 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 000
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate Trust Trustee
Administration, facsimile transmission number (000) 000-0000, telephone
confirmation number (000) 000-0000. The Trustee may change this information by
notice to the Depositor.
(f) Any and all notices to be given to the Swap Counterparty, if
any, will be specified in the Series Supplement.
SECTION 10.05. 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.
88
(b) In addition, the Trustee shall promptly furnish to each Rating
Agency copies of each report to Certificateholders described in Section 4.02.
(c) Any such notice pursuant to this Section 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 Series 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, Xxx Xxxx
00000, Attention: CBO/CLO Monitoring Department, facsimile transmission
number (000) 000-0000, telephone confirmation number (212) 553- 1494.
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 S&P at Standard &
Poor's Rating Group, 00 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention:
Structured Finance Surveillance Group, facsimile transmission number (212)
000-0000, telephone confirmation number (212) 208- 1191. S&P may change
this information by notice to the Depositor and the Trustee.
SECTION 10.06. 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 10.07. Grant of Security Interest. (a) It is the express
intent of the parties hereto that each conveyance of any Underlying Securities
by the Depositor to the Trustee be, and be construed as, a sale of the
Underlying Securities by the Depositor and not a pledge of any Underlying
Securities by the Depositor to secure a debt or other obligation of the
Depositor.
89
(b) In the event that, notwithstanding the aforementioned intent of
the parties, any Underlying Securities are held to be property of the Depositor,
then, (x) it is the express intent of the parties that such conveyance be deemed
a pledge of such Underlying Securities by the Depositor to the Trustee to secure
a debt or other obligation of the Depositor and (y)(1) this Trust Agreement
shall also be deemed to be a security agreement within the meaning of Articles 8
and 9 of the Uniform Commercial Code as in effect from time to time in the State
of New York, or such other State as may be specified in the related Series
Supplement; (2) the conveyance provided for in Section 2.01 hereof shall be
deemed to be a grant by the Depositor to the Trustee of a security interest in
all the Depositor's right, title and interest in and to such Underlying
Securities and all amounts payable to the holders of such Underlying Securities
in accordance with the terms hereof and all proceeds of the conversion,
voluntary or involuntary, of the foregoing into cash, instruments, securities or
other property including all amounts from time to time held or invested in the
applicable Certificate Account, whether in the form of cash, instruments,
securities or other property; (3) the obligations secured by such security
agreement shall be deemed to be all the Depositor's obligations under this Trust
Agreement, including the obligation to provide to the Certificateholders the
benefits of this Trust Agreement relating to such Underlying Securities and the
applicable Trust; and (4) notifications to persons holding such property, and
acknowledgements, receipts or confirmations from persons holding such property,
shall be deemed notifications to, or acknowledgements, receipts or confirmations
from, financial intermediaries, bailees or agents (as applicable) of the Trustee
for the purpose of perfecting such security interest under applicable law.
Accordingly, the Depositor hereby grants to the Trustee a security
interest in the Underlying Securities and all other property described in clause
(y)(2) of the preceding paragraph, for the purpose of securing to the Trustee
the performance by the Depositor of the obligations described in clause (y)(3)
of the preceding paragraph. Notwithstanding the foregoing, the parties hereto
intend the Grant pursuant to Section 2.01 to be a true, absolute and
unconditional sale of the Underlying Securities and assets constituting the
applicable Trust by the Depositor to the Trustee.
(c) The Depositor and the Trustee shall to the extent consistent
with this Trust Agreement, take such actions as may be necessary to ensure that,
if this Trust Agreement were deemed to create a security interest in the
Underlying Securities, such
90
security interest would be deemed to be a perfected security interest of first
priority under applicable law and will be maintained as such for so long as any
of the Underlying Securities remain outstanding. Without limiting the generality
of the foregoing, the Trustee shall file, or shall cause to be filed, all
filings necessary to maintain the effectiveness of any original filings
necessary under the Uniform Commercial Code as in effect in any jurisdiction to
perfect the Trustee's security interest in or lien on the Underlying Securities,
including (x) continuation statements and (y) such other statements as may be
occasioned by (1) any change of name of the Depositor or the Trustee, (2) any
change of location of the place of business or the chief executive office of the
Depositor or (3) any transfer of any interest of the Depositor in any Underlying
Security.
SECTION 10.08. Nonpetition Covenant. Notwithstanding any prior
termination of this Trust Agreement, each of the Trustee (including any
Sub-Administrative Agent, Authenticating Agent, Calculation Agent, or 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 Trust acquiesce, petition or
otherwise invoke or cause the Trust to invoke the process of the United States
of America, any State or other political subdivision thereof or any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government for the purpose of commencing or
sustaining a case by or against the Trust 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 10.09. No Recourse. Neither the Trustee (including any
Sub-Administrative Agent, Authenticating Agent, Calculation Agent, or Paying
Agent) nor the Depositor shall have any recourse to the Underlying Securities,
except for as specifically provided in the related Series Supplement.
SECTION 10.10. 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 10.11. 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.
91
SECTION 10.12. Trust Indenture Act Controls. This Trust Agreement is
subject to the provisions of the Trust Indenture Act 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 Series Supplements, from failing to qualify under the Trust Indenture Act.
92
IN WITNESS WHEREOF, the Depositor and the Trustee have caused their
names to be signed hereto by their respective officers thereunto duly
authorized, in each case as of the day and year first above written.
XXXXXX ABS CORPORATION,
as Depositor
By: /s/ Xxxxx X. Xxxxxxxxx
----------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Managing Director
THE BANK OF NEW YORK,
as Trustee
By: /s/ Xxxxxx X. Xxxxx
----------------------------
Name: Xxxxxx X. Xxxxx
Title: Assistant Vice President
93
Reconciliation and tie between the Trust Agreement dated as of
February 28, 1996, and the Trust Indenture Act of 1939 as amended. This
reconciliation does not constitute part of Trust Agreement.
Trust Indenture Act Trust
of 1939 Section Agreement 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
(b) 3.11(d)
(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) 10.12
EXHIBIT B
Form of Certificate
-------------------
Form of Trust Certificate
-------------------------
NUMBER 1 $131,078,000
CUSIP NO. 131008 AA 2
SEE REVERSE FOR CERTAIN DEFINITIONS
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"),
TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE REPRESENTS A 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 OR THE TRUST ASSETS ARE INSURED OR
GUARANTEED BY ANY GOVERNMENTAL AGENCY OR ANY OTHER PERSON.
XXXXXX ABS CORPORATION
CALLABLE TREASURY STRIP TRUST CERTIFICATES
SERIES 1997-USTS-1
$131,078,000 PRINCIPAL AMOUNT
evidencing a fractional undivided beneficial ownership interest in the Trust, as
defined below, the property of which consists principally of strips representing
the principal amount payable upon maturity of $131,078,000 face amount of the
United States Treasury Bonds due November 15, 2024 issued by the United States
Treasury (the "Underlying Security Issuer") and all payments received thereon
(the "Trust Property"), deposited in trust by Xxxxxx ABS Corporation (the
"Depositor").
THIS CERTIFIES THAT CEDE & CO. is the registered owner of
$131,078,000 DOLLARS nonassessable, fully-paid, fractional undivided interest in
the Callable Treasury Strip Trust Certificates, Series 1997-USTS-1, formed by
the Depositor.
The Trust was created pursuant to a Standard Terms for Trust
Agreements, dated as of February 28, 1996 (the "Standard Terms"), between the
Depositor and The Bank of New York, a New York banking corporation, not in its
individual capacity but solely as Trustee (the "Trustee"), as supplemented by
the Series Supplement, Series 1997-USTS-1, dated as of September 26, 1997 (the
"Series Supplement" and, together with the Standard Terms, the "Trust
Agreement"), between the Depositor and the Trustee. This Certificate does not
purport to summarize the Trust Agreement and reference is hereby made to the
Trust Agreement for information with respect to the interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
obligations of the Trustee with respect hereto. A copy of the Trust Agreement
may be obtained from the Trustee by written request sent to the Corporate Trust
Office. Capitalized terms used but not defined herein have the meanings assigned
to them in the Trust Agreement.
This Certificate is one of the duly authorized Certificates
designated as the "Callable Treasury Strip Trust Certificates, Series
1997-USTS-1" (herein called the "Certificates"). This Certificate is issued
under and is subject to the terms, provisions and conditions of the Trust
Agreement, to which Trust Agreement the Holder of this Certificate by virtue of
the acceptance hereof assents and by which such Holder is bound. The Trust
Property consists of: (i) the ownership interest in, and the right to receive
payment at maturity on, the Underlying Securities described in the Trust
Agreement; and (ii) all funds which are deposited with the Trustee relating to
the Certificates, together with any and all income, proceeds and payments with
respect thereto; provided, however, that any income from the investment of Trust
funds in certain permitted investments ("Eligible Investments") do not
constitute Trust Property.
Subject to the terms and conditions of the Trust Agreement
(including the availability of funds for distributions) and until the obligation
created by the Trust Agreement shall have terminated in accordance therewith,
distributions will be made on each Distribution Date, to the Person in 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
(whether or not a Business Day). If a payment with respect to the Underlying
Securities is made to the Trustee after the date on which such payment was due,
then the Trustee will distribute any such amounts received on the next occurring
Business Day (a "Special Distribution Date").
2
Each Certificateholder, by its acceptance of a Certificate,
covenants and agrees that such Certificateholder will not at any time institute
against the Trust, or join in any institution against the Trust of, any
bankruptcy proceedings under any United States Federal or state bankruptcy or
similar law in connection with any obligations relating to the Certificates or
the Trust Agreement.
Distributions made on this Certificate will be made as
provided in the Trust Agreement by the Trustee by wire transfer in immediately
available funds, or check mailed to the Certificateholder of record in the
Certificate Register without the presentation or surrender of this Certificate
or the making of any notation hereon, except that with respect to Certificates
registered on the Record Date in the name of the nominee of the Clearing Agency
(initially, such nominee shall be Cede & Co.), payments will be made by wire
transfer in immediately available funds to the account designated by such
nominee. Except as otherwise provided in the Trust Agreement and notwithstanding
the above, the final distribution on this Certificate will be made after due
notice by the Trustee of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the Corporate Trust Office or
such other location as may be specified in such notice.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee, by manual signature, this Certificate
shall not entitle the Holder hereof to any benefit under the Trust Agreement or
be valid for any purpose.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE HOLDER HEREOF SHALL
BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
3
IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed as of the date set forth below.
CALLABLE TREASURY STRIP TRUST,
SERIES 1997-USTS-1
By: THE BANK OF NEW YORK
not in its individual
capacity but solely as
Trustee,
By: ---------------------------------
Authorized Officer
Dated: September 26, 1997
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is on one of the Callable Treasury Strip Trust
Certificates, Series 1997-USTS-1, described in the Trust Agreement referred to
herein.
THE BANK OF NEW YORK,
not in its individual
capacity but solely as
Trustee,
By: --------------------------------
Authorized Officer
4
(REVERSE OF CERTIFICATE)
The Certificates are limited in right of distribution to
certain payments and collections respecting the Underlying Securities, all as
more specifically set forth herein and in the Trust Agreement. The registered
Holder hereof, by its acceptance hereof, agrees that it will look solely to the
Trust Property (to the extent of its rights therein) for distributions
hereunder.
The Trust Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor and the Trustee and the rights of the
Certificateholders under the Trust Agreement at any time by the Depositor and
the Trustee with the consent of the holders of the Certificates in the manner
set forth in the Series Supplement and the Standard Terms. Any such consent by
the Holder of this Certificate (or any predecessor Certificate) shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange hereof or in lieu hereof whether or not notation of such consent in
made upon this Certificate. The Trust Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
The Certificates are issuable in fully registered form only in
minimum principal amounts of $1,000 and integral multiples thereof.
As provided in the Trust Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registerable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies of the Certificate Registrar maintained
by the Trustee in the Borough of Manhattan, the City of New York, duly endorsed
by or accompanied by an assignment in the form below and by such other documents
as required by the Trust Agreement, and thereupon one or more new Certificates
of the same class in authorized denominations evidencing the same principal
amount will be issued to the designated transferee or transferees. The initial
Certificate Registrar appointed under the Trust Agreement is The Bank of New
York.
No service charge will be made for any registration of
transfer or exchange, but the Trustee may require exchange of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any transfer or exchange of Certificates.
5
The Depositor and the Trustee and any agent of the Depositor
or the Trustee may treat the Person in whose name this Certificate is registered
as the owner hereof for all purposes, and neither the Depositor, the Trustee,
nor any such agent shall be affected by any notice to the contrary.
It is the intention of the parties to the Trust Agreement that
the Trust created thereunder shall constitute a fixed investment trust for
federal income tax purposes under Treasury Regulation Section 301.7701-4, and
the Certificateholder agrees to treat the Trust, any distributions therefrom and
its beneficial interest in the Certificates consistently with such
characterization.
The Trust and the obligations of the Depositor and the Trustee
created by the Trust Agreement with respect to the Certificates shall terminate
upon the earliest to occur of (i) the distribution in full of all amounts due to
Certificateholders and retirement of the Underlying Securities, (ii) the
distribution in full of all Underlying Securities to the exchanging
Certificateholders on any Optional Exchange Date and any amounts due to
Certificateholders on any Optional Exchange Date, and (iii) the expiration of 21
years from the death of the last survivor of the descendants of Xxxxxx X.
Xxxxxxx, the late Ambassador of the United States to the Court of St.
Xxxxx, living on the date hereof.
An employee benefit plan subject to the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), a plan described in Section
4975(e) of the Code, an entity whose underlying assets include plan assets by
reason of any such plan's investment in the entity, including an individual
retirement account or Xxxxx plan (any such, a "Plan") may purchase and hold
Certificates if either (i) the Underwriter is able to confirm the existence of
at least 100 independent purchasers or (ii) the Plan can represent and warrant
that its purchase and holding of the Certificates would not be prohibited under
ERISA or the Code.
6
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
--------------------------------------------------------------------------------
(Please print or type name and address, including postal zip
code, of assignee)
--------------------------------------------------------------------------------
the within Certificate, and all rights thereunder,
hereby irrevocably constituting and appointing
--------------------------------------------------------------------- Attorney
to transfer said Certificate on the books of the
Certificate Register, with full power of substitution in the premises.
Dated:
--------------------------- *
Signature Guaranteed:
--------------------------- *
*NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member of the New York Stock Exchange or a commercial bank or
trust company.
7
