EXHIBIT 4.2
PPLUS TRUST CERTIFICATES SERIES CMT-1
SERIES SUPPLEMENT
between
XXXXXXX XXXXX DEPOSITOR, INC.,
as Depositor,
and
THE BANK OF NEW YORK,
as Trustee and Securities Intermediary
Dated as of April 16, 2004
SERIES SUPPLEMENT, dated as of April 16, 2004 (the "Supplement"),
by and between XXXXXXX XXXXX DEPOSITOR, INC., a Delaware corporation, as
Depositor, THE BANK OF NEW YORK, a New York corporation, as Trustee and
Securities Intermediary.
W I T N E S S E T H:
WHEREAS, the Depositor desires to create the Trust designated
herein (the "Trust") by executing and delivering this Supplement, which shall
incorporate the terms of the Standard Terms for Trust Agreements, dated as of
February 20, 1998 (the "Standard Terms" and, together with this Supplement, the
"Trust Agreement"), by and between the Depositor and the Trustee and Securities
Intermediary, as modified by this Supplement;
WHEREAS, the Depositor desires to deposit the Underlying
Securities set forth on Schedule I attached hereto into the Trust;
WHEREAS, in connection with the creation of the Trust and the
deposit therein of the Underlying Securities, it is desired to provide for the
issuance of (a) the Certificates evidencing undivided interests in the Trust and
(b) Call Rights;
WHEREAS, the Trustee has joined in the execution of the Standard
Terms and this Supplement to evidence the acceptance by the Trustee of the
Trust; and
WHEREAS, the Securities Intermediary has joined in the execution
of the Standard Terms and this Supplement to evidence the acceptance by the
Securities Intermediary of its obligations thereunder and hereunder;
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants expressed herein, it is hereby agreed by and between the
Depositor and the Trustee and Securities Intermediary as follows:
Section 1. Incorporation of Standard Terms. All of the provisions
of the Standard Terms, a copy of which is attached hereto as Exhibit A, are
hereby incorporated herein by reference in their entirety and this Supplement
and the Standard Terms shall form a single agreement among the parties. In the
event of any inconsistency between the provisions of this Supplement and the
provisions of the Standard Terms, the provisions of this Supplement will control
with respect to the transactions described herein.
Section 2. Definitions. Except as otherwise specified herein or as
the context may otherwise require, the following terms shall have the respective
meanings set forth below for all purposes under this Supplement (Section 2(b)
hereof sets forth terms listed in the Standard Terms that are not applicable to
this Series). Capitalized terms used but not defined herein shall have the
meanings assigned to them in the Standard Terms.
"Allocation Ratio": The ratio of the Class A Allocation to the
Class B Allocation. Voting Rights, Liquidation Proceeds, Realized Losses and
Extraordinary Trust Expenses shall be allocated between Class A
Certificateholders and Class B Certificateholders in accordance with the
Allocation Ratio and, within each Class, each of the foregoing rights and
obligations shall be allocated to Certificateholders in accordance with their
pro rata interests in such Class.
"Authorized Denomination": With respect to Certificates, an
aggregate stated and/or notional principal amount of $1,000, as applicable.
"Business Day": Any day that is not a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust companies in the
City of New York are authorized or obligated by law, regulation or executive
order to close and that also is specified as a Business Day with respect to the
Underlying Securities.
"Call Date": Any Business Day that (i) a Call Holder designates as
a Call Date on or after March 15, 2009; (ii) a Call Holder designates as a Call
Date before March 15, 2009 after the announcement of any redemption of the
Underlying Securities or other unscheduled payment of the Underlying Securities
or after receipt by the Call Holder of notice of the termination of the Trust;
provided that if a Call Right is to be exercised after the announcement of any
redemption of the Underlying Securities or other unscheduled payment of the
Underlying Securities and prior to such redemption or other unscheduled payment,
then the Call Date designated by the Call Holder must be the second Business Day
prior to such redemption or other unscheduled payment; (iii) at any time is
deemed a Call Date upon an acceleration of the Underlying Securities and payment
in full by the Underlying Securities Issuer of all amounts when due; or (iv) at
any time in the case of a tender offer for the Underlying Securities, a Call
Holder is deemed to designate as a Call Date pursuant to Section 2.02(i)(iv) of
the Warrant Agreement.
"Call Holder": The holder of a Class A Call Right or a Class B
Call Right.
"Call Price": The Class A Call Price and the Class B Call Price.
"Call Right": The Class A Call Right and the Class B Call Right.
"Certificates": All 1,400,000 Class A Certificates and all
1,400,000 Class B Certificates.
"Class A Allocation": The present value (discounted at the rate of
7.05% per annum) of (i) the unpaid interest, except for the Class B Payments,
due or to become due on the Underlying Securities on or prior to the Final
Scheduled Distribution Date and (ii) the principal amount of the Underlying
Securities (in each case assuming that the Underlying Securities are paid in
full when due and are not accelerated or redeemed prior to their stated
maturity).
"Class A Call Price" means $25.00 per Class A Certificate being
called plus any accrued and unpaid interest on each Class A Certificate being
called to the Call Date. Any payments of interest on the Call Date by the Trust
to the applicable Class A Certificateholder shall be excluded.
"Class A Call Right": The right, but not the obligation, pursuant
to the Warrant Agreement and any related Warrant Certificates (as defined in the
Warrant Agreement) of one or more Call Holders to purchase from the Class A
Certificateholders on a Call Date some or all of the Class A Certificates for
the Class A Call Price.
"Class A Certificate Account": The Certificate Account established
for the Class A Certificateholders.
"Class A Certificates": The Certificates issued by the Trust in a
stated amount of $25.00 per trust certificate, entitled to receive on each
Distribution Date until and including the Final Scheduled Distribution Date,
distributions at a rate of 6.25% per annum on the stated amount of the Class A
Certificates and a cash distribution of the principal amount of the Underlying
Securities on the Final Scheduled Distribution Date and such other distributions
as described herein.
"Class B Allocation": The sum of the present values (discounted at
the rate of 7.05% per annum) of the Class B Payments (assuming, for purposes
hereof, that the Underlying Securities are paid in full on their stated maturity
date, and no portion thereof is accelerated or redeemed prior to such date).
"Class B Call Price" means the sum of the present values,
discounted at a rate of 7.05% per annum, of the unpaid distributions due, or to
become due, in respect of the Class B Payments to be made on each Class B
Certificate being called on or after the Call Date (assuming, for purposes
hereof, that the Underlying Securities are paid in full on their stated maturity
date, and no portion thereof is accelerated or redeemed prior to such date). Any
payments of interest on the Call Date by the Trust to the applicable Class B
Certificateholder shall be excluded.
"Class B Call Right": The right, but not the obligation, pursuant
to the Warrant Agreement and any related Warrant Certificates (as defined in the
Warrant Agreement) of one or more Call Holders to purchase from the Class B
Certificateholders on a Call Date some or all of the Class B Certificates for
the Class B Call Price.
"Class B Certificate Account": The Certificate Account established
for the Class B Certificateholders.
"Class B Certificates": The Certificates issued by the Trust with
the right to receive, on each Distribution Date, commencing on September 15,
2004 and ending on the Final Scheduled Distribution Date, a distribution of
0.80% per annum of the aggregate notional principal amount of Class B
Certificates and such other distributions as described herein.
"Class B Payments" will have the meaning given to it in Section
3(d).
"Closing Date": April 16, 2004.
"Collection Period": (i) With respect to each March 15
Distribution Date, the period beginning on the day after the September 15
Distribution Date of the current year and ending on such March 15 Distribution
Date, inclusive, and (ii) with respect to each September 15 Distribution Date,
the period beginning on the day after the March 15 Distribution Date of the
prior year and ending on such September 15 Distribution Date, inclusive, except
for the September 15, 2004 Distribution Date, as to which the Collection Period
shall be the period beginning on the Cut-off Date and ending on such September
15, 2004 Distribution Date, inclusive; provided, however, that clauses (i) and
(ii) shall be subject to Section 9(c) hereof.
"Corporate Trust Office": The office of the Trustee located at 000
Xxxxxxx Xxxxxx, Xxxxx 0X, Xxx Xxxx, XX 00000, Attention: Corporate Trust
Department; provided, however, that the office at which certificated securities
are delivered for registration of transfer, cancellation or exchange shall be
the office of the Trustee, located at 000 Xxxxxxx Xxxxxx, Xxxxx 0X, Xxx Xxxx, XX
00000.
"Cut-off Date": April 16, 2004.
"Delivery Certificates" has the meaning given to it in Section
2.02 of the Warrant Agreement.
"Depository": The Depository Trust Company, its nominees and their
respective successors.
"Distribution Date": March 15 and September 15 of each year (or if
such date is not a Business Day, the next succeeding Business Day), commencing
on September 15, 2004 and ending on the Final Scheduled Distribution Date.
"Distribution Election": (a) If there occurs an Event of Default
(as defined in the Underlying Securities Indenture) on the Underlying Securities
under clauses (1) or (2) of Section 5.01 of the Underlying Securities Indenture,
then the Trustee, upon receiving notice of such event, shall, on or immediately
after the 30th day after such event, direct the Market Agent to sell the
Underlying Securities and a pro rata portion of the Related Assets held by the
Trust, in accordance with the Sale Procedures, and the Liquidation Proceeds, if
any, shall be divided between the Classes in accordance with the Allocation
Ratio and each Class' portion shall be deposited into such Class' Certificate
Account and distributed to such Class' Certificateholders pro rata on the first
Business Day following such deposit into such Certificate Account.
(b) If, prior to the day on which the Market Agent sells the
Underlying Securities pursuant to paragraph (a) above, there occurs (and the
trustee receives notice of such occurrence) an acceleration of the date of
maturity of the Underlying Securities and the Underlying Securities are declared
to be immediately due and payable in accordance with the Underlying Securities
Indenture, and the Underlying Securities Issuer:
(i) makes full payment of all amounts when due, and such payment
exceeds the sum of (x) the aggregate stated amount of the Class A
Certificates plus any accrued and unpaid distributions to the date of
payment and (y) the sum of the present values, discounted at the rate
of 7.05% per year, of the unpaid payments due, or to become due, in
respect of the Class B Payments to be made on the Class B Certificates
on or after the date of payment (assuming, for purposes of such
calculation, that the Underlying Securities would have been paid in
full at their stated maturity, that such acceleration had not occurred,
and that no portion thereof would have been redeemed prior to such
maturity date) then all holders of outstanding Call Rights will be
deemed to have exercised their Call Rights automatically, and the
Trustee, upon receiving such acceleration proceeds from the Underlying
Securities Issuer, shall, on the first Business Day following receipt
of such acceleration proceeds, distribute from such acceleration
proceeds the following amounts:
(A) the Class A Call Price or the Class B Call Price per
Certificate, as applicable, shall be distributed from such payment
on account of each Certificate called from the holder thereof
(which holders, pursuant to Section 2.02(d) of the Warrant
Agreement, shall exclude Certificateholders to whom Delivery
Certificates (as defined in the Warrant Agreement) were delivered
in accordance with Section 2.02(d) of the Warrant Agreement),
(B) for each Class A Certificate, $25.00 plus any accrued and
unpaid interest on such Class A Certificate to that date of
payment, or, for each Class B Certificate, the sum of the present
values, discounted at the rate of 7.05% per annum, of the unpaid
distributions that were due, or to become due, in respect of the
Class B Payments to be made on such Class B Certificate on or
after the date of payment (assuming, for purposes of such
calculation, that the Underlying Securities would have been paid
in full on their stated maturity, and that such acceleration had
not occurred, and that no portion thereof would have been redeemed
prior to such stated maturity date), as applicable, shall be
distributed from such payment on account of each Certificate held
by Certificateholders to whom Delivery Certificates were delivered
in accordance with Section 2.02(d) of the Warrant Agreement, and
(C) any amounts remaining shall be divided between the
Classes in accordance with the Allocation Ratio and each Class'
portion shall be distributed pro rata among the Call Holders that
are deemed to have exercised their Call Rights automatically
pursuant to this clause with respect to that Class and the
Certificateholders of that Class to whom Delivery Certificates
were delivered in accordance with Section 2.02(d) of the Warrant
Agreement;
If the payment to be made by the Underlying Securities Issuer
does not exceed the threshold set forth above, the Trustee shall
divide the amount of such payment between the Trust Certificate
Classes in accordance with the Allocation Ratio and distribute
each Class's portion of such amounts pro rata to the Trust
Certificateholders of that Class.
(ii) makes a partial payment of all amounts when due, then the
Trustee, upon receiving such payment, shall:
(A) immediately divide such payment between the Classes in
accordance with the Allocation Ratio and deposit each Class'
portion of such payment into that Class' Certificate Account for
distribution to such Class' Certificateholders pro rata on the
first Business Day following such deposit into such Certificate
Account; provided, that if the Underlying Securities Issuer places
any condition, restriction or obligation on the acceptance of such
partial payment including but not limited to a waiver of any right
granted to a holder of the Underlying Securities, such partial
payment will be rejected by the Trustee and no deposit will be
made into the Certificate Account,
(B) divide a principal amount of the Underlying Securities
equal to the aggregate stated amount of the outstanding Class A
Certificates between the Classes in accordance with the Allocation
Ratio and distribute each Class' portion of the Underlying
Securities to such Class' Certificateholders pro rata and divide a
pro rata portion of the Related Assets between the Classes in
accordance with the Allocation Ratio and distribute each Class'
portion of such Related Assets to such Class' Certificateholders
pro rata to each Certificateholder's last address as it appears in
the Certificate Register within three Business Days of receiving
said notice, and
(C) if any Underlying Securities are not distributed pursuant
to clause (B), immediately direct the Market Agent to sell all
Underlying Securities not so distributed and a pro rata portion of
the Related Assets held by the Trust, in accordance with the Sale
Procedures, and the Liquidation Proceeds, if any, shall be divided
between the Classes in accordance with the Allocation Ratio and
each Class' portion shall be deposited into such Class'
Certificate Account and distributed to such Class'
Certificateholders pro rata on the first Business Day following
such deposit into such Certificate Account; or
(iii) fails to make such payment when due, then the Trustee, upon
receiving notice of such failure to make payment, shall:
(A) divide a principal amount of Underlying Securities equal
to the aggregate stated amount of the outstanding Class A
Certificates and a pro rata portion of the Related Assets in
accordance with the Allocation Ratio between the Classes in
accordance with the Allocation Ratio and distribute each Class'
portion to such Class' Certificateholders pro rata to each
Certificateholder's last address as it appears in the Certificate
Register within three Business Days of receiving said notice, and
(B) if any Underlying Securities are not distributed pursuant
to clause (A), immediately direct the Market Agent to sell all
Underlying Securities not so distributed and a pro rata portion of
the Related Assets held by the Trust, in accordance with the Sale
Procedures, and the Liquidation Proceeds, if any, shall be divided
between the Classes in accordance with the Allocation Ratio and
each Class' portion shall be deposited into such Class'
Certificate Account and distributed to such Class'
Certificateholders pro rata on the first Business Day following
such deposit into such Certificate Account.
(c) If the Underlying Securities Issuer of any Concentrated
Underlying Securities ceases to be a reporting company under the Exchange Act,
and no parent guarantor of such Underlying Securities Issuer, if any, includes
in its Exchange Act reports condensed consolidating financial statements setting
forth financial information for the Underlying Securities Issuer, then the
Trustee, upon receiving notice of such event shall (A) divide a principal amount
of Underlying Securities equal to the aggregate stated amount of the outstanding
Class A Certificates and a pro rata portion of the Related Assets in accordance
with the Allocation Ratio between the Classes in accordance with the Allocation
Ratio and distribute
each Class' portion to such Class' Certificateholders pro rata to each
Certificateholder's last address as it appears in the Certificate Register
within three Business Days of receiving said notice, and (B) if any Underlying
Securities are not distributed pursuant to clause (A), immediately direct the
Market Agent to sell all Underlying Securities not so distributed and a pro rata
portion of the Related Assets held by the Trust, in accordance with the Sale
Procedures, and the Liquidation Proceeds, if any, shall be divided between the
Classes in accordance with the Allocation Ratio and each Class' portion shall be
deposited into such Class' Certificate Account and distributed to such Class'
Certificateholders pro rata on the first Business Day following such deposit
into such Certificate Account.
(d) Upon receiving (A) notice of an acceleration of the date of
maturity of the Underlying Securities and the Underlying Securities Issuer's
partial payment of all amounts when due as described in subsection (ii) of
clause (b) above, or (B) notice of the events set forth in clause (c) above, the
Trustee shall, 10 days prior to the exercise of any remedy, provide written
notice of the termination of the Trust to the Call Holders. Notwithstanding
subsection (ii) of clause (b) and clause (c), the Trustee shall not distribute
any such partial payment, Underlying Securities or Related Assets to any
Certificateholders before the earlier of (i) the expiration of the 10-day notice
of termination period, and (ii) receipt by the Trust of notice of all Call
Holders' election to exercise their Class A Call Right or Class B Call Right, as
applicable. If less than all outstanding Class A Call Rights or Class B Call
Rights are exercised, upon receiving such notice of election, the Trustee shall
select by lot (or by such other reasonable procedure as may be established by
the Trustee) for purchase by such exercising Call Holders in the case of Class A
Certificates the stated amount of Class A Certificates equal to the stated
amount of Class A Call Rights being exercised multiplied by the aggregate stated
amount of the outstanding Class A Certificates not subject to Delivery
Certificates divided by the aggregate stated amount of the outstanding Class A
Call Rights or, in the case of Class B Certificates, the aggregate notional
principal amount of Class B Certificates equal to the aggregate notional
principal amount of Class B Call Rights being exercised multiplied by the
aggregate notional principal amount of the outstanding Class B Certificates not
subject to Delivery Certificates divided by the aggregate notional principal
amount of the outstanding Class B Call Rights. The Certificateholders of the
Trust Certificates to be purchased shall not be entitled to any right other than
the right to receive payment of an amount equal to the applicable Call Price on
the date the applicable Call Rights are exercised, and such Trust Certificates
shall be deemed to have been automatically surrendered by the Certificateholders
to the Trust for further transfer to the exercising Call Holders. The share of
the payment, Underlying Securities and Related Assets to be distributed with
respect to such called Trust Certificates shall be distributed to the exercising
Call Holders. In the case of a sale by the Market Agent of Underlying Securities
and Related Assets pursuant to clause (a) above, the Trustee shall deliver such
Underlying Securities and Related Assets to the purchaser of such Underlying
Securities and Related Assets only against payment in same day funds and the
Trustee shall deposit the same into the Certificate Account.
"Eligible Investments": As defined in the Standard Terms;
provided, however, that (i) the minimum required rating for long-term
instruments will be equal to the lower of the rating of the Underlying
Securities or the Trust Certificates, and (ii) the rating of any short-term
instruments will be A-1+ by Standard & Poor's Ratings Services and P1 by Xxxxx'x
Investors Service, Inc.; and provided, further, that any such investment matures
no later than the Business Day prior to the next succeeding Distribution Date.
"Escrow Agent": As will be set forth in the Escrow Agreement.
"Escrow Agreement": The escrow agreement to be entered into on the
Exercise Date among a given Call Holder, the Trustee and the Escrow Agent
pursuant to Section 14(c)(iii)(2) hereof.
"Event of Default": (i) A default in the payment of any interest
on any Underlying Security after the same becomes due and payable (subject to
any applicable grace period), (ii) a default in the payment of the principal of
or any installment of principal of any Underlying Security when the same becomes
due and payable and (iii) any other event specified as an event of default in
the Underlying Securities Indenture. For a summary of certain events of default
in the Underlying Securities Indenture, please refer to the Prospectus
Supplement.
"Exercise Date": any date on which a Call Holder notifies the
Trustee of its intention to exercise its Call Right in accordance with the
provision of Section 14(c)(iii), any date a Call Holder is deemed to have
exercised its Call Right pursuant to Section 2.02(i)(iv) of the Warrant
Agreement, or any date following the acceleration of the Underlying Securities
and payment in full of all amounts when due by the Underlying Securities Issuer.
"Final Scheduled Distribution Date": March 15, 2033 (or if such
date is not a Business Day, the next succeeding Business Day).
"Fixed Pass-Through Rate": With respect to the Class A
Certificates, 6.25% per annum and with respect to the Class B Certificates,
0.80% per annum.
"Optional Exchange Date": Any Distribution Date or such date as is
designated pursuant to Section 7(b) hereof.
"Ordinary Expenses": The compensation due to the Trustee for
Ordinary Expenses as defined in the Standard Terms, which, with respect to
Ordinary Expenses other than those referred to in clause (iii) of such
definition and other than the costs of converting to XXXXX format the periodic
reports required for the Trust under the Exchange Act, shall be fixed at $2,000
per annum.
"Pass-Through Rate": For each Class of Certificates, the
associated Fixed Pass-Through Rate.
"Prepaid Ordinary Expenses": Zero (0).
"Prospectus Supplements": The Prospectus Supplement dated August
19, 2003 relating to the Class A Certificates and the Prospectus Supplement
dated August 19, 2003 relating to the Class B Certificates.
"Rating Agency": Xxxxx'x Investors Service, Inc. and Standard &
Poor's Ratings Services.
"Record Date": The Business Day immediately preceding each
Distribution Date.
"Series": PPLUS Trust Series CMT-1.
"Underlying Securities": The $35,000,000 aggregate principal
amount of 7.05% Notes due March 15, 2033 issued by the Underlying Securities
Issuer, as described in Schedule I hereto.
"Underlying Securities Indenture": As set forth in Schedule I.
"Underlying Securities Issuer": Comcast Corporation, a
Pennsylvania corporation.
"Underlying Securities Prospectus Supplement": The prospectus
supplement dated March 12, 2003 filed with the Securities and Exchange
Commission by the Underlying Securities Issuer with respect to the Underlying
Securities.
"Warrant Agreement": The Warrant Agreement, dated as of April 16,
2004, by and between the Trust and the Warrant Agent (as defined in the Warrant
Agreement).
(b) The terms listed below are not applicable to this Series.
"Accounting Date"
"Administration Account"
"Administrative Agent"
"Administrative Agent Termination Event"
"Administration Agreement"
"Advance"
"Calculation Agent"
"Eligible Expense"
"Exchange Rate Agent"
"Floating Pass-Through Rate"
"Letter of Credit"
"Limited Guarantor"
"Limited Guaranty"
"Notional Amount"
"Requisite Reserve Amount"
"Reserve Account"
"Retained Interest"
"Surety Bond"
"Swap Agreement"
"Swap Counterparty"
"Swap Distribution Amount"
"Swap Guarantee"
"Swap Guarantor"
"Swap Receipt Amount"
"Swap Termination Payment"
Section 3. Designation of Trust and Certificates. (a) The Trust
created hereby shall be known as the "PPLUS Trust Series CMT-1". The Class A
Certificates and Class B Certificates evidencing certain undivided ownership
interests therein shall be known as the "PPLUS Class A 6.25% Trust Certificates
Series CMT-1" and the "PPLUS Class B 0.80% Trust Certificates Series CMT-1,"
respectively.
(b) The Class A Certificates and Class B Certificates shall be
held through the Depository in book-entry form and shall be substantially in the
form attached hereto as Exhibits B and C, respectively. The Class A Certificates
shall be issued in authorized denominations of $25.00 and integral multiples
thereof and the Class B Certificates shall be issued with a notional principal
amount of $25.00 and integral multiples thereof. Except as provided in the
Standard Terms, the Trust shall not issue additional Certificates or incur any
indebtedness; provided, however, from time to time, upon obtaining prior written
confirmation by each Rating Agency that such action will not result in a
downgrading or withdrawal of its rating of the Certificates, the Depositor may,
without the consent of the Certificateholders, increase the amount of the
Underlying Securities in the Trust and the Trust may issue a corresponding
amount of additional Certificates in accordance with Section 5.12(a) of the
Standard Terms except that clauses (v), (vi) and (vii) of Section 5.12(a) shall
not apply to this Series and a corresponding number of additional Warrants in
accordance with Article I of the Warrant Agreement.
(c) The Class A Certificates will be entitled to receive (i) on
each Distribution Date, commencing on September 15, 2004 and ending on the Final
Scheduled Distribution Date, or such earlier date if the Underlying Securities
are redeemed prior to the Final Scheduled Distribution Date, distributions at a
rate of 6.25% per annum on the stated amount of the Class A Certificates and
(ii) on the Final Scheduled Distribution Date, a distribution of the aggregate
principal amount of the Underlying Securities.
(d) On each Distribution Date, the Class B Certificates will be
entitled to receive a distribution of 0.80% per annum multiplied by the notional
principal amount of the Class B Certificates (the "Class B Payments").
(e) Any reference to the principal amount of the Certificates
shall be construed as a reference to the stated amount of the Class A
Certificates and/or the notional principal amount of the Class B Certificates,
unless otherwise indicated.
Section 4. Satisfaction of Conditions to Initial Execution and
Delivery of Trust Certificates. The Trustee hereby acknowledges receipt, on or
prior to the Closing Date, of:
(i) the Underlying Securities set forth on Schedule I hereto; and
(ii) all documents set forth in Section 5.12 of the Standard Terms
except that clauses (v), (vi) and (vii) of Section 5.12(a) shall not
apply to this Series.
Section 5. Distributions. (a) On each Distribution Date, the
Trustee shall apply the funds in the Certificate Account, solely to the extent
of Available Funds in the Certificate Account, as follows:
(i) first, to the Trustee, reimbursement for any approved
Extraordinary Trust Expenses incurred by the Trustee in accordance with
Section 6(b) hereof and approved by not less than 100% of the
Certificateholders;
(ii) second, pro rata to the holders of the Class A Certificates
and Class B Certificates, distributions accrued during the related
Collection Period at the rate of 6.25% per annum on the stated amount
of the Class A Certificates to holders of the Class A Certificates on
such Distribution Date and 0.80% per annum multiplied by the notional
principal amount of Class B Certificates to holders of the Class B
Certificates on such Distribution Date, commencing on September 15,
2004 and ending on the Final Scheduled Distribution Date;
(iii) third, divided between the Classes in accordance with the
proportionate interest of each Class in any delayed interest payments
on the Underlying Securities (e.g., 6.25/7.05 to the Class A
Certificateholders and 0.80/7.05 to the Class B Certificateholders) and
each Class' portion distributed to the holders of each Class pro rata,
if available, any additional payments paid by the Underlying Securities
Issuer as a result of a delay in the receipt by the Trustee of any
interest payment on the Underlying Securities;
(iv) fourth, pro rata to the Class A Certificateholders, on the
Final Scheduled Distribution Date only, a distribution of the aggregate
principal amount of the Underlying Securities;
(v) fifth, to the extent there remain Available Funds in the
Certificate Account, to any creditors of the Trust in satisfaction of
liabilities thereto; and
(vi) sixth, to the extent there remain Available Funds in the
Certificate Account, to Xxxxxxx Xxxxx Capital Services, Inc. and if no
Available Funds remain in the Certificate Account then no distribution
will be made pursuant to this Section 5(a)(vi).
Subject to Section 9(c) hereof, to the extent Available Funds are insufficient
to make any required distributions due to the Certificates on any Distribution
Date, any shortfall will be carried over and will be distributed on the next
Distribution Date on which sufficient funds are available on the Available Funds
to pay such shortfall. Neither Xxxxxxx Xxxxx & Co. nor any of its Affiliates
will have any claim against the Trust pursuant to Section 5(a)(vi) if the Trust
fails to make a distribution on a Distribution Date to such person because no
Available Funds remain in the Certificate Account on such Distribution Date.
(b) On an Optional Exchange Date, the Trustee shall distribute to
Xxxxxxx Xxxxx & Co. or any of its Affiliates, other than the Depositor, or any
other Person exercising an optional exchange pursuant to Section 7 hereof, as
the case may be, Underlying Securities in accordance with Section 7 hereof.
Section 6. Trustee's Fees; Escrow Agent's Fees. (a) Payment to the
Trustee of Ordinary Expenses shall be as set forth in a separate agreement
between the Trustee and the Depositor. The Trustee agrees that in the event
Ordinary Expenses are not paid in accordance with such agreement, it shall (i)
not have any claim or recourse against the Trust or the property of the Trust
with respect thereto and (ii) continue to perform all of its services as set
forth herein unless it elects to resign as Trustee in accordance with Section
7.08 of the Standard Terms.
(b) Extraordinary Trust Expenses shall not be paid out of the
Deposited Assets unless (i) the Trustee is satisfied that it will have adequate
security or indemnity in respect of such costs, expenses and liabilities, and
(ii) all the Certificateholders of Certificates then outstanding have voted to
require the Trustee to incur such Extraordinary Trust Expenses. If Extraordinary
Trust Expenses are not approved unanimously as set forth in clause (ii), such
Extraordinary Trust Expenses shall not be an obligation of the Trust, and the
Trustee shall not file any claim against the Trust therefor notwithstanding
failure of Certificateholders to reimburse the Trustee. In addition, if the
conditions in (i) and (ii) are not both satisfied, the Trustee shall not be
obligated to incur any Extraordinary Trust Expense.
(c) In the event that one or more Call Holders is required to
deposit the applicable Call Price with the Escrow Agent on the Exercise Date
pursuant to Section 14(c)(iii)(2) hereof, the Depositor and the Escrow Agent
shall enter into an agreement reasonably acceptable to both parties thereto
whereby the Depositor shall pay to the Escrow Agent a fee in consideration for
its services under the Escrow Agreement or Escrow Agreements, as applicable.
Section 7. Optional Exchange. (a) Xxxxxxx Xxxxx & Co. or any of
its Affiliates (other than the Depositor), if it holds Certificates, or any
other (i) Person or (ii) group of Affiliated Persons (in each case other than
the Depositor) holding Class A Certificates with an aggregate stated amount of
$5 million or more and an equal aggregate notional principal amount of Class B
Certificates, all acquired pursuant to the exercise of Class A Call Rights or
Class B Call Rights held by it, (provided that, in the case of a group of
Affiliated Persons, no single Affiliated Person holds Class A Certificates with
an aggregate stated amount of less than
$500,000 and Class B Certificates with a notional principal amount of less than
$500,000 acquired pursuant to the exercise of Class A Call Rights or Class B
Call Rights, as applicable, held by it) may notify the Trustee, not less than 30
days but not more than 60 days prior to any Optional Exchange Date, that:
(i) such Person intends or Affiliated Persons intend to tender an
Authorized Denomination of Class A Certificates and an equal number of
Class B Certificates that it holds or they hold to the Trustee on such
Optional Exchange Date in exchange for a proportional amount of
Underlying Securities;
(ii) such exchange will not cause the Trust or Depositor to fail
to satisfy the applicable requirements for exemption under Rule 3a-7
under the Investment Company Act of 1940, as amended;
(iii) such exchange will not affect the characterization of the
Trust as a "grantor trust" under the Code;
(iv) in the case of an exchange of less than all outstanding
Certificates, such exchange will not cause a failure to satisfy the
minimum requirements for the Class A Certificates to remain listed on
the New York Stock Exchange, unless the Person or Affiliated Persons
tendering such Certificates will hold all remaining outstanding
Certificates upon completion of the exchange of such Certificates
pursuant to this Section 7;
(v) such exchange will not be made with respect to Certificates
subject to outstanding Call Rights held by any Person or Affiliated
Persons other than the Person or Affiliated Persons exercising such
exchange; and
(vi) in the case of an exchange by a person other xxxx Xxxxxxx
Xxxxx & Co. or any of its Affiliates (other than the Depositor), such
exchange will be made with respect to an aggregate stated amount of
Class A Certificates equal to the aggregate stated amount of Class A
Certificates acquired by such Person or Affiliated Persons pursuant to
the exercise of the applicable Call Rights held by it or them.
Upon tender of such Class A Certificates and Class B Certificates on such
Optional Exchange Date, the Trustee will deliver to the Person or Affiliated
Persons tendering such Certificates an amount of Underlying Securities having a
principal amount equal to the aggregate principal amount of Underlying
Securities then held by the Trust times the aggregate stated amount of Class A
Certificates being tendered divided by the aggregate stated amount of Class A
Certificates then outstanding, and in the case of an exchange by Xxxxxxx Xxxxx &
Co. or any of its Affiliates, where such Person or Affiliated Person holds
unexercised Class A Call Rights respecting the exchanged Class A Certificates
and a corresponding number of unexercised Class B Call Rights respecting the
exchanged Class B Certificates, such unexercised Class A Call Rights and Class B
Call Rights held by such Person or Affiliated Person shall be cancelled. Any
Call Holder that has properly provided notice of exercise to the Warrant Agent
and has deposited the Call Price with the Escrow Agent may concurrently
designate an Optional Exchange Date,
and such Optional Exchange Date shall be specified in the notice of exercise,
provided, however, that such Optional Exchange Date shall not occur prior to the
applicable Call Date.
(b) When a tender offer for the Underlying Securities is pending,
Xxxxxxx Xxxxx & Co. or any of its Affiliates (other than the Depositor), if it
holds Certificates, or any other Person or Affiliated Persons (other than the
Depositor, or an Affiliate of the Person making such tender offer) holding Class
A Certificates with an aggregate stated amount of $5 million or more and an
equal aggregate notional principal amount of Class B Certificates, all acquired
pursuant to the exercise of the applicable Call Rights held by it (provided
that, in the case of a group of Affiliated Persons, no single Affiliated Person
holds Class A Certificates with an aggregate stated amount of less than $500,000
and Class B Certificates with a notional principal amount of less than $500,000
acquired pursuant to the exercise of Class A Call Rights or Class B Call Rights,
as applicable, held by it), may notify the Trustee, not less than 5 days but not
more than 60 days prior to any such Optional Exchange Date as they may
designate, that:
(i) such Person intends or such Affiliated Persons intend to
tender an Authorized Denomination of Class A Certificates with an
aggregate stated amount of $5 million or more and a corresponding
number of Class B Certificates that it holds or they hold to the
Trustee on such Optional Exchange Date in exchange for a proportional
amount of Underlying Securities;
(ii) such exchange will not cause the Trust or Depositor to fail
to satisfy the applicable requirements for exemption under Rule 3a-7
under the Investment Company Act of 1940, as amended;
(iii) such exchange will not affect the characterization of the
Trust as a "grantor trust" under the Code,
(iv) in the case of an exchange of less than all outstanding
Certificates, such exchange will not cause a failure to satisfy the
minimum requirements for the Certificates to remain listed on the New
York Stock Exchange, unless the Person or Affiliated Persons tendering
such Certificates will hold all remaining outstanding Certificates upon
completion of the exchange of such Certificates pursuant to this
Section 7;
(v) such exchange will not be made with respect to Certificates
subject to outstanding Call Rights held by any Person or Affiliated
Persons other than the Person or Affiliated Persons exercising such
exchange; and
(vi) in the case of an exchange by a person other xxxx Xxxxxxx
Xxxxx & Co. or any of its Affiliates (other than the Depositor), such
exchange will be made with respect to an aggregate stated amount of
Class A Certificates equal to the aggregate stated amount of Class A
Certificates acquired by such Person or Affiliated Persons pursuant to
the exercise of Call Rights held by it or them.
Upon tender of such Class A Certificates and Class B Certificates on such
Optional Exchange Date, the Trustee will deliver to the Person or Affiliated
Persons tendering such Certificates an amount of Underlying Securities having a
principal amount equal to the aggregate principal
amount of Underlying Securities then held by the Trust times the aggregate
stated amount of Class A Certificates being tendered divided by the aggregate
stated amount of Class A Certificates then outstanding, and in the case of an
exchange by Xxxxxxx Xxxxx & Co. or any of its Affiliates, where such Person or
Affiliated Person holds unexercised Class A Call Rights respecting the exchanged
Class A Certificates and a corresponding number of unexercised Class B Call
Rights respecting the exchanged Class B Certificates, such unexercised Class A
Call Rights and Class B Call Rights held by such Person or Affiliated Person
shall be cancelled.
(c) The requirements set forth in paragraphs (a)(ii), (a)(v) and
(a)(vi) of Section 4.07 of the Standard Terms do not apply to an Optional
Exchange pursuant to this Section 7.
(d) Any costs associated with the exercise of the rights granted
under paragraphs (a) and (b) of this Section 7 will be borne by the Person or
Affiliated Persons exercising such rights and not by the Trust.
(e) In no event can an Optional Exchange be made unless an equal
number of Class A and Class B Certificates are tendered for exchange by each
Holder exercising this Optional Exchange right.
Section 8. Events of Default. Within 30 days of its receipt of
notice of the occurrence of an Event of Default, the Trustee will give notice to
the Certificateholders, transmitted by mail, of all such uncured or unwaived
Events of Default actually known to it. However, unless there is an Event of
Default relating to the payment of principal of or interest on any of the
Underlying Securities, the Trustee will be protected in withholding such notice
if in good faith it determines that the withholding of such notice is in the
interest of the Certificateholders; provided, however, that the Trustee shall
give notice of an Event of Default to the extent required under "Distribution
Election."
Section 9. Miscellaneous. (a) The provisions of Section 4.04,
Advances, of the Standard Terms shall not apply to the Certificates.
(b) The Certificateholders shall not be entitled to terminate the
Trust or cause the sale or other disposition of the Underlying Securities;
provided, however, that Certificateholders holding all, but not less than all,
of the outstanding Certificates may exercise their rights under Section 13(b)
with respect to all such Certificates.
(c) If the Trustee has not received payment with respect to a
Collection Period on the Underlying Securities on or prior to the related
Distribution Date, such distribution will be made promptly upon receipt of such
payment. No additional amounts shall accrue on the Certificates or be owed to
Certificateholders as a result of such delay; provided, however, that any
additional interest owed and paid by the Underlying Securities Issuer as a
result of such delay shall be paid to the Class A Certificateholders and Class B
Certificateholders, proportionately to the ratio of their respective
entitlements to interest payments.
(d) The outstanding principal balance of the Class A Certificates
and the aggregate notional principal amount of the Class B Certificates shall
not be reduced by the amount of any Realized Loss.
(e) The Trust may not engage in any business or activities other
than in connection with, or relating to, the holding, protecting and preserving
of the Deposited Assets and the issuance of the Certificates and Call Rights,
and other than those required or authorized by the Trust Agreement or incidental
and necessary to accomplish such activities. The Trust may not issue or sell any
certificates or other obligations other than the Certificates and Call Rights,
or otherwise incur, assume or guarantee any indebtedness for money borrowed.
(f) The Trust may not consolidate, amalgamate, merge with or into,
or be replaced by or convey, transfer or lease its properties and assets
substantially as an entirety to, any another entity or permit any other entity
to consolidate, amalgamate, merge with or into, or replace the Trust.
(g) Except as expressly provided in the Trust Agreement, the Trust
may not sell the Underlying Securities.
(h) If the Trustee resigns or is removed as Trustee in accordance
with Section 7.08 of the Trust Agreement, in addition to providing the Depositor
with written notice, the Trustee shall also provide the Rating Agencies with
written notice.
(i) Xxxxxxx Xxxxx & Co. shall act as the Market Agent and shall
serve in such capacity in accordance with the terms of the Market Agent
Agreement attached hereto as Exhibit D.
(j) Notwithstanding anything in the Trust Agreement to the
contrary, the Trustee may be removed upon 60 days prior written notice delivered
by Certificateholders holding Certificates that represent the Required
Percentage-Removal, and such removal shall take effect upon the appointment of a
successor Trustee and its acceptance of such appointment as provided in the
Trust Agreement.
Section 10. Notices. (a) All directions, demands and notices
hereunder or under the Standard Terms shall be in writing and shall be delivered
as set forth below (unless written notice is otherwise provided to the Trustee).
If to the Depositor, to:
Xxxxxxx Xxxxx Depositor, Inc.
c/x Xxxxxxx Xxxxx & Co.
World Financial Center
New York, NY 10080
Attention: Xxxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Trustee, to:
The Bank of New York
Corporate Trust Dealing & Trading Group
000 Xxxxxxx Xxxxxx, Xxxxx 0X
Xxx Xxxx, XX 00000
Attention: PPLUS Trust Series CMT-1
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Securities Intermediary, to:
The Bank of New York
Corporate Trust Dealing & Trading Group
000 Xxxxxxx Xxxxxx, Xxxxx 0X
Xxx Xxxx, XX 00000
Attention: PPLUS Trust Series CMT-1
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Warrant Agent, to
The Bank of New York
Corporate Trust Dealing & Trading Group
000 Xxxxxxx Xxxxxx, Xxxxx 0X
Xxx Xxxx, XX 00000
Attention: PPLUS Trust Series CMT-1
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Rating Agencies, to:
Xxxxx'x Investors Service, Inc.
00 Xxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: CBO/CLO Monitoring Department
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and to:
Standard & Poor's Ratings Services
00 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Structured Finance Surveillance Group
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(b) Copies of any tender offer materials and all directions,
demands and notices required to be given to the Certificateholders hereunder or
under the Standard Terms will be given to the Warrant Agent by facsimile
transmission and by mail.
Section 11. Governing Law. This Supplement and the transactions
described herein shall be construed in accordance with and governed by the laws
of the State of New York.
Section 12. Counterparts. This Supplement may be executed in any
number of counterparts, each of which shall be deemed to be an original, and all
such counterparts shall constitute but one and the same instrument.
Section 13. Termination of the Trust. (a) The Trust shall
terminate upon the earlier of (i) the payment in full at maturity or sale by the
Trust after a payment default on the Underlying Securities and the distribution
in full of all amounts due to the Certificateholders, (ii) the distribution to
the Certificateholders of all Underlying Securities in accordance with the
Distribution Election, (iii) the exchange of all outstanding Certificates for
Underlying Securities pursuant to one or more Optional Exchanges, (iv) the Final
Scheduled Distribution Date and (v) the holders of all, but not less than all,
of the Certificates exercising their election in Section 13(b) below.
(b) Certificateholders who hold all, but not less than all, of the
outstanding Certificates may, upon prior written notice to the Rating Agencies,
elect to terminate the Trust at any time; provided that (i) the exercise of such
termination right would not cause the Trust or the Depositor to fail to satisfy
the applicable requirements for exemption under Rule 3a-7 under the Investment
Company Act of 1940, as amended and (ii) if and for so long as the call warrants
remain outstanding, all of the Call Holders have consented to such termination.
(c) To the extent that the provisions of this Section 13 conflict
with Section 10.01 of the Standard Terms, the latter shall control.
Section 14. Sale or Redemption of Underlying Securities; Call
Right
(a) In the case of Extraordinary Trust Expenses approved by 100%
of the Certificateholders of each Class, pursuant to Section 6(b) hereof, the
Trustee may, upon prior written notice to the Rating Agencies, elect to sell all
or a portion of the Underlying Securities to pay such Extraordinary Trust
Expenses.
(b) As a holder of the Underlying Securities, the Trust may
receive redemption proceeds (the "Redemption Amount") upon the redemption of the
Underlying Securities, in whole or in part, by the Underlying Securities Issuer
pursuant to the Underlying Securities Indenture and the Underlying Securities
Prospectus Supplement. (i) Upon the
redemption of the Underlying Securities in whole, but not in part, (A) on the
stated maturity date of such Underlying Securities or (B) at the option of the
Underlying Securities Issuer, upon at least 30 days, but not more than 60 days,
prior notice pursuant to the Underlying Securities Indenture, the Redemption
Amount will be distributed pro rata to the holders of the Underlying Securities,
including the Trust. Upon receiving such Redemption Amount, the Trust shall
distribute the Redemption Amount first, pro rata to the Class A
Certificateholders until each shall have received the stated amount of each
Class A Certificate it holds plus accrued and unpaid distributions on the Class
A Certificates to the Redemption Date; second, pro rata to the Class B
Certificateholders until each shall have received the sum of the present values
(discounted at the rate of 7.05% per annum) of the Class B Payments on or after
the Redemption Date (assuming, for purposes of such calculation, that the
Underlying Securities would have been paid in full on their stated maturity with
no such redemption or acceleration); and third, any remaining Redemption Amount
will be divided between the Classes of trust certificates in accordance with a
percentage equal to 6.25/7.05 of such amount to the Class A Certificateholders
and 0.80/7.05 of such amount to the Class B Certificateholders, and within each
class the Redemption Amount will be distributed pro rata to the
Certificateholders of the Class A or Class B Certificates entitled to such
Redemption Amount upon the date such Redemption Amount is received in
immediately available funds by the Trust if such Redemption Amount is received
prior to 1:00 p.m. local time at the office of the Trustee and otherwise on the
next Business Day. (ii) Upon any redemption of the Underlying Securities in part
at the option of the Underlying Securities Issuer upon at least 30 days, but not
more than 60 days, prior notice pursuant to the Underlying Securities Indenture,
the Redemption Amount will be distributed pro rata to the holders of the
Underlying Securities, including the Trust. Upon any such redemption in part,
the Trustee shall select by lot (or by such other reasonable procedure as may be
established by the Trustee) a stated amount of Class A Certificates and an equal
notional principal amount of Class B Certificates equal to the aggregate amount
of each Class of Certificates then outstanding multiplied by the aggregate
principal amount of Underlying Securities subject to redemption and then held by
the Trust divided by the aggregate principal amount of Underlying Securities
then held by the Trust; provided that the amount of each Class of Trust
Certificates being selected by lot may be reduced by the aggregate stated amount
of Class A Certificates or notional principal amount of Class B Certificates, as
applicable, called pursuant to the exercise of Call Rights prior to such
redemption in accordance with the terms of the Warrant Agreement. Upon receiving
such Redemption Amount, the Trust shall distribute the Redemption Amount, first,
pro rata to the Class A Certificateholders selected by lot pursuant to this
subsection until each shall have received the stated amount of each Class A
Certificate it holds plus accrued and unpaid distributions on the Class A
Certificates to the Redemption Date; second, pro rata to the Class B
Certificateholders selected by lot pursuant to this subsection until each shall
have received the sum of the present values (discounted at the rate of 7.05% per
annum) of the Class B Payments on or after the Redemption Date (assuming for
purposes of such calculation, that the Underlying Securities would have been
paid in full on their stated maturity with no such redemption or acceleration);
and third, any remaining Redemption Amount will be divided between the Classes
of trust certificates in accordance with a percentage equal to 6.25/7.05 of such
amount to the Class A Certificateholders and 0.80/7.05 of such amount to the
Class B Certificateholders, and within each class the Redemption Amount will be
distributed pro rata to the Certificateholders of the Class A or Class B
Certificates. Such Redemption Amount will be distributed to the Class A and
Class B Certificateholders entitled to such Redemption Amount upon the date such
Redemption Amount is received in immediately available funds by the Trust if
such Redemption Amount is received prior to 1:00 pm local time at the office of
the Trustee and otherwise on the next Business Day. Upon distribution of the
Redemption Amount by the Trustee, the Trust Certificates called pursuant to the
exercise of Call Rights and the Trust Certificates selected by lot pursuant to
this subsection (ii) shall be deemed to have been surrendered for cancellation
by the Trust, and the aggregate stated amount of the outstanding Class A
Certificates and the aggregate notional principal amount of the outstanding
Class B Certificates shall be reduced by the aggregate stated amount of such
Class A Certificates and the aggregate notional principal amount of such Class B
Certificates, as applicable; provided that the right of a Certificateholder to
receive the Call Price will not be affected by any such deemed surrender.
Payment of the Redemption Amount with respect to the Certificates will be made
to the Call Holder exercising the Call Rights.
(c) The Call Terms are as follows:
(i) The initial holders of the Call Rights are as named in the
Call Warrants and such holders may transfer the Call Rights, in whole
or in part, to one or more third parties in privately negotiated
transactions;
(ii) A Call Holder that has met the exercise requirements set
forth in paragraph (c)(iii) of this Section 14 may, on the Call Date,
exercise its option to purchase, in whole or in part, a principal or
notional amount of Class A or Class B Certificates, as applicable,
proportionate to such Call Holder's exercised Call Warrants, in
Authorized Denominations of the Class A or Class B Certificates at the
Class A Call Price or Class B Call Price, as applicable;
(iii) In order to exercise its Call Right on a Call Date, a Call
Holder must, not less than 30 days (or not less than three days in the
case of an announcement of any redemption of the Underlying Securities
or other unscheduled payment of the Underlying Securities or after
receipt of notice of termination of the Trust or not less than five
Business Days prior to the expiration of a tender offer for the
Underlying Securities) but not more than 60 days prior to such Call
Date:
(1) notify the Trustee in writing of its intention to
exercise such Call Right (which notice is irrevocable, subject to
Section 2.02(i)(v) of the Warrant Agreement) and whether such
exercise is in connection with a tender offer for the Underlying
Securities. In the event that such notice is provided in
connection with a tender offer for the Underlying Securities, if
the exercising Holder did not receive from the Warrant Agent
notice of a Tender Offer, then such Holder shall also provide the
Warrant Agent with any information the Holder may have from a
third-party source indicating that such Tender Offer is pending.
(2) deposit the applicable Call Price with the Escrow Agent
(the "Escrow Deposit") to be held in escrow pursuant to an Escrow
Agreement reasonably satisfactory to the Trustee and substantially
in the form attached hereto as Exhibit E (to be entered into
immediately preceding delivery of the applicable Call Price by
such Call Holder to the Escrow Agent) until such Call Price is
paid
by the Trustee to the Certificateholders in accordance with
paragraph (d) of this Section 14 or returned to the exercising
Holders pursuant to subsection (i) of Section 2.02 of the Warrant
Agreement; provided, that if (a) all of the outstanding Trust
Certificates of a given Class are to be purchased pursuant to the
exercise of the Warrants on an Exercise Date and the exercising
Call Holder at such time holds Class A Certificates or Class B
Certificates that are subject to Call Rights, the Call Holder may
deposit such Class A Certificates or Class B Certificates with the
Escrow Agent in lieu of the portion of the Call Price that would
relate thereto, and (b) if less than all of the outstanding Class
B Trust Certificates are to be purchased pursuant to the exercise
of the Warrants on an Exercise Date and the exercising Call Holder
at such time holds Class B Certificates that are subject to Call
Rights, the Call Holder may deposit such Class B Certificates with
the Escrow Agent in lieu of the portion of the Call Price that
would relate thereto.
(3) provide the Trustee with any other documents customary
for a transaction of this nature, including a certificate of the
Call Holder certifying the solvency of such Call Holder on such
date; provided that the Call Holder need not provide any such
solvency certificate if the rating of the senior, unsecured
long-term debt of the Call Holder, or the Call Holder's credit
support provider, if applicable, by Xxxxx'x Investors Service,
Inc. and Standard & Poor's Ratings Services is in one of the
investment grade categories of Xxxxx'x Investors Service, Inc. and
Standard & Poor's Ratings Services, respectively, on such date.
The provisions of this Section 14(c)(iii)(1) through (3) shall not apply if
Warrants are being exercised upon an acceleration of the Underlying Securities
and payment in full by the Underlying Securities Issuer of all amounts due upon
such acceleration.
(d) In connection with any exercise of the Call Rights to purchase
Class A Certificates, the Trustee shall select by lot (or by such other
reasonable procedure as may be established by the Trustee) a stated amount of
the outstanding Class A Certificates to be surrendered by the Class A
Certificateholders thereof to the Trustee upon any such exercise (other than
Class A Trust Certificates held by any Person to whom a Delivery Certificate was
delivered in accordance with Section 2.02(d) of the Warrant Agreement, as
evidenced by the registration of such Delivery Certificate in the Delivery
Register in accordance with Section 4.01 of the Warrant Agreement), deliver such
Class A Certificates to the exercising Call Holder and the proceeds of the Class
A Call Price shall be distributed pro rata among such Class A Certificateholders
on the Call Date in accordance with the provisions of the Warrant Agreement. In
connection with any exercise of the Call Rights to purchase Class B
Certificates, if the amount to be purchased exceeds the amount of Trust
Certificates of such Class held by the Call Holder and deposited with the Escrow
Agent, the Trustee shall select by lot (or by such other reasonable procedure as
may be established by the Trustee) an aggregate notional principal amount of the
outstanding Class B Certificates to be surrendered by the Class B
Certificateholders thereof to the Trustee upon any such exercise (other than
Class B Trust Certificates held by any Persons to whom a Delivery Certificate
was delivered in accordance with Section 2.02(d) of the Warrant Agreement, as
evidenced by the registration of such Delivery Certificate in the Delivery
Register in accordance with Section 4.01 of the Warrant Agreement), deliver such
Class B Certificates to the exercising Call Holder and the proceeds of the Class
B Call Price shall be distributed pro
rata among such Certificateholders on the Call Date in accordance with the
provisions of the Warrant Agreement. Upon distribution of the applicable Call
Price, the Trust Certificates called pursuant to the exercise of Call Rights
shall be deemed to have been surrendered and such Trust Certificates shall be
transferred to the Call Holder; provided that the right of a Certificateholder
to receive the Call Price will not be affected by any such deemed surrender.
(e) The rights of the Certificateholders under the Trust Agreement
and the Certificates are limited by the terms, provisions and conditions of the
Trust Agreement and the Warrant Agreement with respect to the exercise of the
applicable Call Rights by the Call Holder. The Certificateholders, by their
acceptance of Certificates, covenant and agree to tender any and all
Certificates to the Warrant Agent upon the Call Holder's exercise of Call Rights
and deposit of the applicable Call Price with the Escrow Agent for such
Certificates in accordance with the applicable procedures in the Warrant
Agreement.
(f) Upon receipt of a notice of a tender offer for the Underlying
Securities, the Trustee shall deliver notice of the tender offer to the Warrant
Agent and holders of Delivery Certificates (as defined in Section 2.02(d) of the
Warrant Agreement) within two Business Days after receipt of notice from the
Tender Offeror (as defined in the Warrant Agreement). Within two Business Days
of the expiration of the period for validly delivering tender offer exercise
notices pursuant to Section 2.02(i)(i) of the Warrant Agreement, the Trustee
shall, after giving effect to the exercise of Call Rights with respect to Trust
Certificates already held by the Call Holder, as set forth in the Warrant
Agreement, (A) select by lot (or by such other reasonable procedure as may be
established by the Trustee), in the case of Class A Certificates, a stated
amount of Class A Certificates equal to the aggregate stated amount of Class A
Certificates not subject to Delivery Certificates then outstanding multiplied by
the aggregate principal amount of Class A Call Rights being exercised divided by
the aggregate principal amount of the outstanding Class A Call Rights and, in
the case of Class B Certificates an aggregate notional principal amount of Class
B Certificates equal to the aggregate notional principal amount of Class B
Certificates not subject to Delivery Certificates then outstanding multiplied by
the aggregate notional principal amount of Class B Call Rights being exercised
divided by the aggregate notional principal amount of the outstanding Class B
Call Rights and (B) notify the Certificateholders of the selected Certificates
that, subject to Section 2.02(i) of the Warrant Agreement, such Certificates
will be purchased on the Call Date. Upon the Trustee's receipt of the tender
offer proceeds, the applicable Call Price will be distributed pursuant to
Section 2.02(e) and Section 2.02(i)(vi) of the Warrant Agreement pro rata to the
Certificateholders whose Certificates have been purchased and the tender offer
proceeds will be distributed by the Trustee pro rata to the exercising Call
Holders pursuant to Section 2.02(i) of the Warrant Agreement. Upon distribution
of the applicable Call Price and tender offer proceeds, the Trust Certificates
called pursuant to the exercise of Call Rights shall be deemed to have been
surrendered for cancellation by the Trustee and the aggregate stated amount of
the outstanding Trust Certificates shall be reduced by the aggregate stated
amount of such Trust Certificates; provided that the right of a
Certificateholder to receive the Call Price will not be affected by any such
deemed surrender.
Section 15. Amendments. Notwithstanding anything in the Trust
Agreement to the contrary, in addition to the other restrictions on modification
and amendment contained herein, the Trustee shall not enter into any amendment
or modification of the Trust Agreement
that would adversely affect in any material respect the interests of the
Certificateholders or the Call Holders without the consent of 100% of such
Certificateholders or Call Holders, as the case may be; provided, however, that
no such amendment or modification will be permitted if the Trustee has been
advised by the Depositor that such amendment or modification would alter the
status of the Trust as a "grantor trust" for federal income tax purposes.
Further, no amendment shall be permitted pursuant to paragraphs (vi), (vii) and
(x) of Section 11.01(a) of the Standard Terms without prior written confirmation
by each Rating Agency that such amendment will not result in a downgrading or
withdrawal of its rating of the Certificates. The Trustee may consult with
counsel and shall be entitled to rely upon an Opinion of Counsel for purposes of
determining compliance with the provisions of this Section 15.
Section 16. Voting of Underlying Securities, Modification of
Indenture. The Trustee, as holder of the Underlying Securities, has the right to
vote and give consents and waivers in respect of the Underlying Securities as
permitted by the Depository and except as otherwise limited by the Trust
Agreement. In the event that the Trustee receives a request from the Depository,
the Underlying Securities trustee or the Underlying Securities Issuer for its
consent to any amendment, modification or waiver of the Underlying Securities,
the Underlying Securities Indenture or any other document thereunder or relating
thereto, or receives any other solicitation for any action with respect to the
Underlying Securities, the Trustee shall mail a notice of such proposed
amendment, modification, waiver or solicitation to each Certificateholder of
record as of such date. The Trustee shall request instructions from the
Certificateholders as to whether or not to consent to or vote to accept such
amendment, modification, waiver or solicitation. The Trustee shall consent or
vote, or refrain from consenting or voting, in the same proportion (based on the
relative outstanding principal balances of the Certificates) as the Certificates
of the Trust were actually voted or not voted by the Certificateholders thereof
as of a date determined by the Trustee prior to the date on which such consent
or vote is required after weighing the votes of the Class A Certificateholders
and the Class B Certificateholders in accordance with the Allocation Ratio;
provided, however, that, notwithstanding anything in the Trust Agreement to the
contrary, the Trustee shall at no time vote on or consent to any matter (i)
unless such vote or consent would not (based on an Opinion of Counsel) alter the
status of the Trust as a "grantor trust" for federal income tax purposes or
result in the imposition of tax upon the Certificateholders, or (ii) that would
alter the timing or amount of any payment on the Underlying Securities,
including, without limitation, any demand to accelerate the Underlying
Securities, except in the event of a default under the Underlying Securities or
an event that with the passage of time would become an event of default under
the Underlying Securities and with the consent of 100% of the Certificateholders
and 100% of the Call Holders, or (iii) except as provided in the following
paragraph, that would result in the exchange or substitution of any of the
outstanding Underlying Securities pursuant to a plan for the refunding or
refinancing of such Underlying Securities except in the event of a default under
the Underlying Securities Indenture and only with the consent of 100% of the
Certificateholders and 100% of the Call Holders. The Trustee shall have no
liability for any failure to act resulting from Certificateholders' or Call
Holders' late return of, or failure to return, directions requested by the
Trustee from the Certificateholders and Call Holders.
If an offer is made by the Underlying Securities Issuer to issue
new obligations in exchange and substitution for any of the Underlying
Securities, pursuant to a plan for the refunding or refinancing of the
outstanding Underlying Securities or any other offer is made for
the Underlying Securities, the Trustee shall notify the Certificateholders, the
Call Holders and the Rating Agencies of such offer promptly. Subject to Sections
7(b) and 14 in connection with a tender offer and the exercise of Call Rights or
Optional Exchange rights, the Trustee must reject any such offer unless the
Trustee is directed by the affirmative vote of 100% of the Certificateholders
and 100% of the Call Holders to accept such offer, the Trustee has received the
tax opinion described above and if the Trustee is so directed, the Trustee shall
promptly notify the Rating Agencies of such direction accompanied by evidence of
the affirmative vote of such Certificateholders and Call Holders.
If an event of default under the Underlying Securities Indenture
occurs and is continuing, and if directed by 100% of the Certificateholders, the
Trustee shall vote the Underlying Securities in favor of directing, or take such
other action as may be appropriate to direct, the Underlying Securities trustee
to declare the unpaid principal amount of the Underlying Securities and any
accrued and unpaid interest thereon to be due and payable.
Section 17. Call Right Documentation. Simultaneously with the
execution hereof, the Depositor hereby directs the Trustee, in the name of and
on behalf of the Trust, to enter into a Warrant Agreement and any related
Warrant Certificates (as defined in the Warrant Agreement) evidencing the Call
Rights and to make representations contained therein on behalf of the Trust. At
the direction of the Depositor, the Trustee shall execute such further documents
as may be required to evidence any transfer of any or all of the rights,
interests or obligations under the Warrant Agreement and any related Warrant
Certificates.
Section 18. Third Party Beneficiary. The Escrow Agent and each
Call Holder shall be third party beneficiaries of this Trust Agreement.
Section 19. Nonpetition Covenant. Solely with respect to the Trust
and the Series and for no other purpose, Section 11.07 of the Standard terms is
hereby deleted and replaced with the following:
"Section 11.07. Nonpetition Covenant. Notwithstanding any prior
termination of this Trust Agreement, each of the Trustee (including any
Administrative Agent, Authenticating Agent and Paying Agent) and the Depositor
agrees that it shall not, until the date which is one year and one day after the
termination of the PPLUS Trust Series CMT-1, acquiesce, petition or otherwise
invoke or cause the Trust to invoke the process of the United States, any State
or other political subdivision thereof or any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government for the purpose of commencing or sustaining a case by or against
the Trust under a Federal or state bankruptcy, insolvency or similar law or
appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or
other similar official of such Trust or all or any part of the property or
assets of such Trust or ordering the winding up or liquidation of the affairs of
such Trust.
Section 20. Amendments to Standard Terms. Solely with respect to
the Trust and the Series and for no other purpose, the Standard Terms are hereby
amended as follows:
(a) Clause (iii) of Subsection (c) of Section 2.01 of the Standard
Terms shall be deleted and replaced with the following:
"at the time of delivery of the Underlying Securities, Depositor
owns such Underlying Securities, has the right to transfer its interest in such
Underlying Securities and such Underlying Securities are free and clear of any
lien, pledge, encumbrance, right, charge, claim or other security interest
(other than the lien created by this Trust Agreement); and"
(b) Subsection (e) of Section 2.01 of the Standard Terms shall be
deleted and replaced with the following:
"Any Trust created hereunder shall not engage in any business or
activities other than in connection with, or relating to, the holding,
protecting and preserving of the Deposited Assets and the issuance of
the Certificates and, if applicable, Call Rights, and other than those
required or authorized by this Trust Agreement or incidental to and
necessary to accomplish such activities. Any Trust created hereunder
shall not issue or sell any certificates or other obligations other
than the Certificates or, if applicable, Call Rights or otherwise
incur, assume or guarantee any indebtedness for money borrowed."
(c) Clause (v) of Subsection (b) of Section 4.08 of the Standard
Terms shall be deleted and replaced with the following:
"that Holders of Certificates receiving notice of Call Rights
being exercised with respect to the Certificates held by them shall not
be entitled to any interest on the Certificates for any period on and
after the Call Date, and the only remaining right of Holders of such
Certificates is to receive payment of the Call Price upon surrender of
the Certificates to the Warrant Agent; and"
(d) The first sentence of subsection (d) of Section 4.08 of the
Standard Terms shall be deleted and replaced with the following:
"Once such notice is mailed to a Holder, such Holder shall not be
entitled to any right as a Holder other than the right to receive
payment of the Call Price on the Call Date and the Certificates subject
to the Call Right shall be deemed to have been automatically
surrendered to the Trust for further transfer to the holder exercising
its Call Right."
(e) Subsection (e) of Section 4.08 of the Standard Terms shall be
deleted and replaced with the following:
"Subject to Section 2.02(a)(i) of the Warrant Agreement, at or
prior to 12:00 noon on the Call Date, the holder of the Call Right to
be exercised shall deposit with the Escrow Agent by wire transfer in
same-day funds money sufficient to pay the Call Price of the
Certificates to be purchased on that date."
(f) Subsection (f) of Section 4.08 of the Standard Terms shall be
deleted and replaced with the following:
"This subsection has been intentionally left blank."
(g) Subsection (g) of Section 4.08 shall be deleted and replaced
with the following:
"Upon surrender of any Certificate that is purchased in part, the
Depositor shall execute and the Trustee shall authenticate and deliver
to the Holder a new Certificate equal in principal amount to the
portion of such surrendered Certificate not purchased."
IN WITNESS WHEREOF, the parties hereto have caused this Supplement
to be duly executed by their respective authorized officers as of the date first
written above.
Xxxxxxx Xxxxx Depositor, Inc.,
as Depositor
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
The Bank of New York,
not in its individual capacity
but as Trustee
By: /s/ Xxxxxxxx Xxxxxxx
---------------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Authorized Signatory
The Bank of New York,
as Securities Intermediary
By: /s/ Xxxxxxxx Xxxxxxx
---------------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Authorized Signatory
[SERIES SUPPLEMENT SIGNATURE PAGE]
SCHEDULE I
PPLUS TRUST CERTIFICATES, SERIES CMT-1
UNDERLYING SECURITIES SCHEDULE
Underlying Securities: $35,000,000 7.05% Notes due March 15,
2033 of the Underlying Securities Issuer.
Underlying Securities Issuer: Comcast Corporation, a Pennsylvania
corporation.
Underlying Securities Guarantors: Comcast Cable Communications, Inc.,
Comcast Cable Communications Holdings,
Inc., Comcast Cable Holdings, LLC,
Comcast MO of Delaware, Inc. and Comcast
MO Group, Inc.
Underlying Securities Indenture: Indenture dated as of January 7, 2003,
among the Underlying Securities
Guarantors, the Underlying Securities
Issuer and the Underlying Securities
Trustee, as amended and supplemented by
the first supplemental indenture dated as
of March 25, 2003.
Underlying Securities Trustee: The Bank of New York
Underlying Securities 00000XXX0
CUSIP Number:
Underlying Securities March 14, 2003
Original Issue Date:
Underlying Securities $750,000,000 7.05% Notes due 2033
Original Amount Issued: (principal amount $1,000 per security)
Underlying Securities 333-101861
Commission File Number:
Underlying Securities March 15, 2033
Maturity Date:
Underlying Securities March 15, 2033
Principal Payment Date:
Underlying Securities March 15 and September 15, or if any such
Interest Payment Dates: date is not a business day, then the next
succeeding business day to the persons in
whose names the Underlying Securities are
registered at the close of business on
the March 1 or September 1, respectively,
immediately prior to the relevant
interest payment
date, subject to certain exceptions.
Underlying Securities 7.05% per annum.
Interest Rate:
Underlying Securities March 1 and September 1.
Record Dates:
Underlying Securities The Underlying Securities Issuer will
Redemption: have the option to redeem the Underlying
Securities as a whole at any time or in
part from time to time, at the option of
the Underlying Securities Issuer, at a
redemption price equal to the greater of
(i) 100% of their principal amount and
(ii) the sum of the present values of the
remaining scheduled payments of principal
and interest thereon (exclusive of
interest accrued to the date of
redemption) discounted to the redemption
date on a semiannual basis (assuming a
360-day year consisting of twelve 30-day
months) at, in each case, the Treasury
Rate plus 40 basis points, plus in each
case accrued interest thereon to the date
of redemption.
Underlying Securities None.
Collateral:
Underlying Securities None.
Amortization:
Underlying Securities Semi-annual.
Accrual Periods:
Underlying Securities The Underlying Securities are denominated
Authorized Denomination and payable in U.S. dollars and are
and Specified Currency: available in minimum denominations of
$1,000 and integral multiples thereof.
Underlying Securities "Baa3" by Xxxxx'x Investors Service, Inc.
Rating as of Closing: and "BBB" by Standard & Poor's Ratings
Services.
Underlying Securities Form: Book-entry security with DTC.
EXHIBIT A
STANDARD TERMS FOR TRUST AGREEMENTS
between
XXXXXXX XXXXX DEPOSITOR, INC.,
as Depositor,
and
UNITED STATES TRUST COMPANY OF NEW YORK,
as Trustee and as Securities Intermediary
TRUST CERTIFICATES
Dated as of February 20, 1998
Reconciliation and tie between the Standard Terms, dated as of
February 20, 1998, and the Trust Indenture Act of 1939, as amended. This
reconciliation and tie does not constitute part of the Standard Terms.
================================================================================
Trust Indenture Act Standard
of 1939 Section Terms Section
--------------------------------------------------------------------------------
310(a)(1) 7.07
--------------------------------------------------------------------------------
(a)(2) 7.07
--------------------------------------------------------------------------------
(a)(5) 7.07
--------------------------------------------------------------------------------
312(a) 7.14
--------------------------------------------------------------------------------
313(a) 7.16
--------------------------------------------------------------------------------
314(a) 3.10
--------------------------------------------------------------------------------
(c)(1) 1.03
--------------------------------------------------------------------------------
(c)(2) 1.03
--------------------------------------------------------------------------------
(e) 1.03
--------------------------------------------------------------------------------
315(a)(1) 7.01
--------------------------------------------------------------------------------
315(a)(2) 7.03
--------------------------------------------------------------------------------
315(b) 7.01(d)
--------------------------------------------------------------------------------
315(d) 7.01(c)
--------------------------------------------------------------------------------
316(a)(1)(A) 5.19
--------------------------------------------------------------------------------
(a)(1)(B) 5.20
-------------------------------------------------------------------------------
(b) 5.21
--------------------------------------------------------------------------------
(c) 1.03(b)
--------------------------------------------------------------------------------
317(a)(1) 5.18
--------------------------------------------------------------------------------
(b) 5.13
--------------------------------------------------------------------------------
318(a) 11.11
================================================================================
TABLE OF CONTENTS
Article I Definitions AND ASSUMPTIONS..........................................1
Section 1.01. Definitions....................................................1
Section 1.02. Rules of Construction.........................................13
Section 1.03. Compliance Certificates and Opinions; Record Date.............13
Article II DECLARATION OF TRUSTS; ISSUANCE OF CERTIFICATES; PURPOSE AND
CLASSIFICATION OF TRUSTS.....................................................14
Section 2.01. Creation and Declaration of Trusts; Assignment of
Deposited Assets............................................14
Section 2.02. Acceptance by Trustee.........................................16
Section 2.03. Representations and Warranties of the Depositor...............16
Section 2.04. Breach of Representation, Warranty or Covenant................16
Section 2.05. Agreement to Execute, Authenticate and Deliver Certificates...16
Section 2.06. Custody and Holding of Deposited Assets.......................17
Article III ADMINISTRATION OF EACH TRUST......................................18
Section 3.01. Administration of Each Trust..................................18
Section 3.02. Collection of Certain Underlying Security Payments............18
Section 3.04. Distribution or Sale of the Underlying Securities.............19
Section 3.05. Investment of Funds in the Accounts...........................20
Section 3.06. Maintenance of Credit Support.................................20
Section 3.07. Realization upon Defaulted Underlying Securities..............20
Section 3.08. Retained Interest.............................................21
Section 3.09. Access to Certain Documentation...............................21
Section 3.10. Reports by the Depositor......................................21
Section 3.11. Charges and Expenses..........................................22
Article IV DISTRIBUTIONS AND REPORTS TO CERTIFICATEHOLDERS....................22
Section 4.01. Distributions.................................................22
Section 4.02. Distributions on Certificates.................................22
Section 4.03. Reports to Certificateholders.................................23
Section 4.04. Advances......................................................24
Section 4.05. Allocation of Realized Losses and Trust Expenses..............24
Section 4.06. Compliance with Withholding Requirements......................24
Section 4.07. Optional Exchange.............................................25
Section 4.08. Call Right....................................................26
Article V THE CERTIFICATES....................................................27
Section 5.01. The Certificates..............................................27
Section 5.02. Execution, Authentication and Delivery........................28
Section 5.03. Temporary Certificates........................................28
Section 5.04. Registration; Registration of Transfer and Exchange...........28
Section 5.05. Mutilated, Destroyed, Lost and Stolen Certificates............29
Section 5.06. Persons Deemed Owners.........................................30
Section 5.07. Cancellation..................................................30
-i-
Section 5.08. Global Securities.............................................30
Section 5.09. Notices to Depository.........................................31
Section 5.10. Definitive Certificates.......................................31
Section 5.11. Currency of Distributions.....................................32
Section 5.12. Conditions of Execution, Authentication and Delivery of
New Series..................................................32
Section 5.13. Appointment of Paying Agent...................................34
Section 5.14. Authenticating Agent..........................................34
Section 5.15. Voting Rights with Respect to Underlying Securities...........35
Section 5.16. Actions by Certificateholders.................................35
Section 5.17. Events of Default.............................................36
Section 5.18. Judicial Proceedings Instituted by Trustee; Trustee May
Bring Suit..................................................36
Section 5.19. Control by Certificateholders.................................36
Section 5.20. Waiver of Past Defaults.......................................36
Section 5.21. Right of Certificateholders to Receive Payments Not to Be
Impaired....................................................37
Section 5.22. Remedies Cumulative...........................................37
Article VI THE DEPOSITOR......................................................37
Section 6.01. Liability of the Depositor....................................37
Section 6.02. Limitation on Liability of the Depositor......................37
Section 6.03. Depositor May Purchase Certificates...........................37
Section 6.04. Merger or Consolidation of the Depositor......................38
Section 6.05. No Liability of the Depositor with Respect to the
Underlying Securities; Certificateholders to Proceed
Directly Against the Underlying Securities Issuer(s)........38
Article VII THE TRUSTEE.......................................................38
Section 7.01. Duties of Trustee.............................................38
Section 7.02. Agreements Between Trustee and Administrative Agents..........41
Section 7.03. Certain Matters Affecting the Trustee.........................42
Section 7.04. Trustee Not Liable for Recitals in Certificates or
Underlying Securities.......................................43
Section 7.05. Trustee May Own Certificates..................................43
Section 7.06. Trustee's Fees and Expenses...................................43
Section 7.07. Eligibility Requirements for Trustee..........................43
Section 7.08. Resignation or Removal of the Trustee; Appointment of
Successor Trustee...........................................44
Section 7.09. Appointment of Office or Agency...............................46
Section 7.10. Representations and Warranties of Trustee.....................46
Section 7.11. Indemnification of Trustee by the Depositor; Contribution.....46
Section 7.12. No Liability of the Trustee with Respect to the
Underlying Securities; Certificateholders to Proceed
Directly Against the Underlying Securities Issuer(s)........47
Section 7.13. The Depositor to Furnish Trustee with Names and
Addresses of Certificateholders.............................47
Section 7.14. Preservation of Information...................................48
Section 7.15. Reports by Trustee............................................48
Section 7.16. Trustee's Application for Instructions from the Depositor.....48
-ii-
Article VIII MARKET AGENT.....................................................48
Section 8.01. Market Agent..................................................48
Article IX SECURITIES INTERMEDIARY............................................48
Section 9.01. Resignation or Removal of the Securities Intermediary;
Appointment of Successor Securities Intermediary..............48
Article X TERMINATION.........................................................50
Section 10.01. Termination upon Liquidation of All Underlying Securities....50
Article XI MISCELLANEOUS PROVISIONS...........................................51
Section 11.01. Amendment....................................................51
Section 11.02. Limitation on Rights of Certificateholders...................52
Section 11.03. Governing Law................................................53
Section 11.04. Notices......................................................53
Section 11.05. Notice to Rating Agencies....................................53
Section 11.06. Severability of Provisions...................................54
Section 11.07. Nonpetition Covenant.........................................54
Section 11.08. No Recourse..................................................54
Section 11.09. Article and Section References...............................54
Section 11.10. Counterparts.................................................54
Section 11.11. Trust Indenture Act..........................................54
STANDARD TERMS FOR TRUST AGREEMENTS dated as of February 20, 1998
between XXXXXXX XXXXX DEPOSITOR, INC., a Delaware corporation, as Depositor (the
"Depositor"), and UNITED STATES TRUST COMPANY OF NEW YORK, a New York
corporation, as Trustee (in such capacity, the "Trustee") and as securities
intermediary (in such capacity, the "Securities Intermediary").
PRELIMINARY STATEMENT
The Depositor, the Trustee and the Securities Intermediary
have duly authorized the execution and delivery of these Standard Terms for
Trust Agreements (the "Standard Terms") to provide for one or more Series (and
one or more Classes within each such Series) of Certificates, issuable from time
to time as provided in these Standard Terms.
Each such Series (inclusive of any Classes specified within such
Series) will be issued under a separate Supplement to these Standard Terms, duly
executed and delivered by the Depositor, the Trustee and the Securities
Intermediary. With respect to each Series, these Standard Terms and all
amendments hereof and, unless the context otherwise requires, the related
Supplement and all amendments thereto shall be known as the "Trust Agreement".
All representations, covenants and agreements made herein by each of
the Depositor, the Trustee and the Securities Intermediary are for the benefit
and security of the Holders and, to the extent provided in the applicable
Supplement, for the benefit and security of any Credit Support Provider or any
other party as specified therein.
The Depositor and the Securities Intermediary are entering into
these Standard Terms, and the Trustee is accepting the trust created hereby, for
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged.
Article I
Definitions AND ASSUMPTIONS
Section 1.01. Definitions. Except as otherwise specified herein or
in the applicable Supplement or as the context may otherwise require, the
following terms have the respective meanings set forth below for all purposes of
this Trust Agreement.
"Account": As defined in Section 3.05.
"Accounting Date": With respect to any Series, if applicable, as
defined in the related Supplement.
"Administration Account": As defined in Section 7.02.
"Administration Agreement": The written contract, if any, between
the Trustee and an Administrative Agent and any successor Trustee or
Administrative Agent providing that the Trustee can delegate certain of its
administrative obligations with respect to any Series hereunder.
"Administrative Agent": Any Person with which the Trustee has
entered into an Administration Agreement and that meets the qualifications of an
Administrative Agent, pursuant to Section 7.02.
"Administrative Agent Termination Event": With respect to any given
Series, any of the following: (i) any failure by an Administrative Agent to
remit to the Trustee any funds in respect of collections on the Underlying
Securities and Credit Support, if any, as required under this Trust Agreement,
that continues unremedied for five days after the giving of written notice of
such failure to the Administrative Agent by the Trustee or the Depositor, or to
the Administrative Agent, the Depositor and the Trustee by the Holders of not
less than 25% of the Voting Rights; (ii) any failure by an Administrative Agent
duly to observe or perform in any material respect any of its other covenants or
obligations under the Administration Agreement with respect to such Series that
continues unremedied for thirty days after the giving of written notice of such
failure to the Administrative Agent by the Trustee or the Depositor, or to the
Administrative Agent, the Depositor and the Trustee by the Holders of not less
than 25% of the Voting Rights; and (iii) events of insolvency, readjustment of
debt, marshalling of assets and liabilities or similar proceedings and certain
actions by or on behalf of an Administrative Agent
indicating its insolvency or inability to pay its obligations. Any additional
Administrative Agent Termination Event with respect to any given Series may be
set forth in the applicable Supplement.
"Advance": As defined in Section 4.04.
"Affiliate": With respect to any specified Person, any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control", when used with respect to any specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Allocation Ratio": With respect to any Series, as defined in the
related Supplement.
"Authenticating Agent": As defined in Section 5.14.
"Authorized Denomination": The minimum denomination in which a
Certificate may be issued, or any multiple thereof, as specified in the related
Supplement.
"Available Funds": Unless otherwise specified in the applicable
Supplement, for any Distribution Date in respect of a given Series or Class, the
sum of (i) all amounts actually received on or with respect to the Underlying
Securities (including Liquidation Proceeds and investment income earned on
Account funds invested pursuant to Section 3.05) with respect to such Series
during the related Collection Period, (ii) all amounts received pursuant to any
Credit Support Instruments with respect to such Series for such Distribution
Date and (iii) all other amounts, if any, specified by the applicable Supplement
less any amount held for the benefit of the Retained Interest.
"Beneficial Owner": With respect to Certificates held through a
Depository, the beneficial owner of a Certificate. For purposes only of Section
5.16, the Trustee shall be obligated to treat a Person who claims to be a
beneficial owner of a Certificate as a "Beneficial Owner" within the meaning of
the Supplement only if such Person has first delivered to the Trustee, (i) a
certificate or other writing executed by such Person stating the full name and
address of such Person, the principal distribution amount of the Certificate
with respect to which such Person claims to be the Beneficial Owner, and the
participant in the Depository ("such Person's Participant") through which such
Person holds its beneficial ownership interest in the Certificates and (ii) a
certificate or other writing executed by such Person's Participant confirming
that such Person's Participant holds on its own books and records Certificates
for the account of such Beneficial Owner and identifying the principal
distribution amount held for such Beneficial Owner.
"Book-Entry Securities": Securities maintained in the form of
entries (including, without limitation, the Security Entitlements in such
Securities) in the commercial book-entry system of the Fed and held for the
Trustee, directly or indirectly, by any Trustee's Fed Member. Book-Entry
Securities shall not include, in any event, any Certificated Security (or any
Security Entitlement in any Certificated Security) held, directly or indirectly,
through a Clearing Corporation.
"Business Day": With respect to any Series, as defined in the
related Supplement.
"Calculation Agent": If applicable with respect to any Series, as
specified in the applicable Supplement.
"Call Date": The date on which the Call Right may be exercised, as
specified in the applicable Supplement.
"Call Price": If applicable with respect to any Series, as
specified in the applicable Supplement.
2
"Call Right": The right of the holder thereof (or any successor), as
named in the applicable Supplement, to purchase Certificates from the Holders
thereof or to purchase Underlying Securities from the Trust.
"Call Terms": The terms pursuant to which a Call Right may be
exercised, as set forth in the applicable Supplement.
"Callable Series": A Series or Class within such Series subject to
a Call Right, as specified in the applicable Supplement.
"Certificate" and "Certificates": Any trust certificate or trust
certificates authorized by, executed pursuant to and authenticated and delivered
under, this Trust Agreement, and unless the context requires otherwise,
"Certificate" and "Certificates" shall also be deemed to refer to the Retained
Interest.
"Certificate Account": As defined in Section 3.03.
"Certificate Principal Balance": With respect to an Outstanding
Certificate, as determined at any time, the maximum amount that the Holder
thereof is entitled to receive as distributions allocable to principal payments
on the Underlying Securities. The Certificate Principal Balance, if any, of any
Class within a given Series (other than those Classes, if any, specified in the
related Supplement), as of any date of determination, shall be equal to the
aggregate initial Certificate Principal Balance thereof less the sum of (i) all
amounts allocable to prior distributions made to such Class in respect to
principal of the Underlying Securities, (ii) any reductions attributable to
Certificates surrendered in exchange for Underlying Securities, as and to the
extent provided in the applicable Supplement, and (iii) any reductions in the
Certificate Principal Balance thereof deemed to have occurred in connection with
allocations of (A) Realized Losses in respect of principal of the Underlying
Securities and (B) expenses of the Trust if any only to the extent specified in
the applicable Supplement, each as allocated to such Class pursuant to the
applicable Supplement.
"Certificate Register" and "Certificate Registrar": As defined in
Section 5.04.
"Certificated Security": As defined in Section 8-102(a)(4) of the
UCC.
"Certificateholder": Any holder of a Certificate or a Retained
Interest.
"Class": With respect to any Series, any one of the classes of
Certificates of such Series, each class consisting of Certificates having
identical terms.
"Clearing Agency": An organization that (i) is registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act and (ii) is a
Clearing Corporation.
"Clearing Agency Participant": At any time, in respect of any
Clearing Agency, a securities intermediary that maintains Securities Accounts
with such Clearing Agency at such time.
"Clearing Corporation": The meaning specified in Section
8-102(a)(5) of the UCC.
"Closing Date": With respect to any Series, the day on which
Certificates of such Series are first executed, authenticated and delivered, as
specified in the related Supplement.
"Code": The Internal Revenue Code of 1986, as amended, and Treasury
Regulations promulgated thereunder.
"Collection Period": With respect to any Distribution Date for a
Series (or Class within such Series), the period specified in the related
Supplement.
"Commission": The Securities and Exchange Commission, as from time
to time constituted, created under the Exchange Act or, if at any time after the
execution and delivery of this Trust Agreement such Commission is not existing
and performing the duties now assigned to it, then the body then performing such
duties.
"Concentrated Underlying Securities": Any Underlying Securities that
constitute 10% or more of the total Underlying Securities with respect to a
Series of Certificates.
3
"Corporate Trust Office": The principal corporate trust office of
the Trustee located at the address set forth in the related Supplement or such
other address as the Trustee may designate from time to time by notice to the
Holders and the Depositor, or the principal corporate trust office of any
successor Trustee (or such other addresses as a successor Trustee may designate
from time to time by notice to the Holders and the Depositor).
"Credit Support": As specified in the related Supplement, a Letter
of Credit, Limited Guaranty, Surety Bond, Swap Agreement, Swap Guarantee, or
other asset intended to support or ensure the timely or ultimate distributions
of amounts due in respect of a Series (or Class within such Series).
"Credit Support Instrument": The instrument or document pursuant to
which the Credit Support for a given Series (or Class within such Series) is
provided, as specified in the applicable Supplement.
"Credit Support Provider": With respect to any Series (or Class
within such Series), the Person, if any, that will provide any Credit Support
with respect to all or a portion of a Series or Class, as specified in the
applicable Supplement.
"Cut-off Date": With respect to any Series, the date specified as
such in the related Supplement. For purposes of this Trust Agreement, any
Underlying Security acquired by the Depositor after the applicable Cut-off Date
but prior to the applicable Closing Date and included in the related Trust as of
such Closing Date shall be deemed to have been Outstanding as of such Cut-off
Date and references to the principal balance of such Underlying Security as of
such Cut-off Date shall be deemed to be to the principal balance of such
Underlying Security as of the date on which it was acquired by the Depositor.
"Definitive Certificates": As defined in Section 5.10.
"Deposited Assets": With respect to any Series, the following
assets, properties and items (together with the accounts and book-entry accounts
containing or reflecting, directly or indirectly, such assets, properties and
items), in each case, wherever located, however held and whether now existing or
hereafter acquired:
(i) all Underlying Securities and Related Assets;
(ii) all payments receivable or received in respect of the Underlying
Securities including the immediate and continuing right to claim for,
collect, receive and give receipt for principal, premium, if any, and
interest payments in respect of the Underlying Securities and all other
monies payable thereunder;
(iii) all Financial Assets, Security Entitlements and Investment
Property in, constituting, evidenced by, resulting from or otherwise
related to, any of the Deposited Assets;
(iv) all other rights and remedies (but none of the obligations)
comprising, arising or resulting from or related to the Grant of the
Deposited Assets including, without limitation, the right to give and
receive notices and other communications, to make waivers or other
agreements, to exercise all rights and options of the Depositor, to bring
Proceedings in the name of the Depositor or otherwise, and generally to
exercise all of the rights and remedies of the Depositor and to do and
receive anything that the Depositor is or may be entitled to do or receive
thereunder or with respect thereto; and
(v) any other assets identified as Deposited Assets in the related
Supplement, which assets may include cash, cash equivalents, guarantees,
letters of credit, financial insurance, interest rate, currency, equity,
commodity and credit-linked swaps, caps, floors, collars and options,
forward contracts, structured securities and other instruments and
transactions that credit enhance, hedge or otherwise support the Underlying
Securities designed to assure the servicing or timely distribution of
payments to Holders.
"Depositor": Xxxxxxx Xxxxx Depositor, Inc., a Delaware corporation,
and, if a successor Person shall have become the Depositor pursuant to any
applicable provisions of this Trust Agreement, "Depositor" shall mean such
successor Person. With respect to any
4
provisions of this Trust Agreement that relate to the provisions of the TIA,
"Depositor" shall include any obligor on the Certificates as the term obligor
is defined in the TIA.
"Depositor Order": A written order or request, respectively, signed
in the name of the Depositor by any one of its Executive Officers.
"Depository": With respect to the Certificates of any Series (or
Class within such Series) issuable in whole or in part in the form of one or
more Global Securities, the Person so designated in the applicable Supplement,
and, if at any time there is more than one such Person, "Depository" as used
with respect to the Certificates of any such Series or Class shall mean the
Depository with respect to the Certificates of that Series or Class.
"Discount Certificate": Any Certificate that is issued with
"original issue discount" within the meaning of Section 1273(a) of the Code and
any other Certificate designated by the Depositor as issued with original issue
discount for United States Federal income tax purposes.
"Distribution Date": With respect to any Series (or Class within
such Series), each date specified as a "Distribution Date" for such Series (or
Class) in the related Supplement.
"Distribution Election": With respect to any Series, as specified
in the related Supplement.
"Depository Securities": Securities consisting of Security
Entitlements to Certificated Securities, held by the Depository or a Clearing
Corporation or a nominee of either subject to the control of the Depository and
in bearer form or indorsed in blank by an appropriate Person or registered on
the books of the issuer thereof in the name of the Depository or its Clearing
Corporation or a nominee of either.
"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.
"DCR": Xxxx & Xxxxxx Credit Rating Co. and any successor thereto.
"Eligible Account": Either (i) an account or accounts maintained
with a Federal or State chartered depository institution or trust company the
long-term unsecured obligations of which are rated by the Rating Agency the
higher of (x) at least the then current long-term rating of the Certificates or
(y) in one of its two highest long-term rating categories (unless otherwise
specified in the Supplement) at the time any amounts are held in deposit therein
or (ii) a trust account(s) maintained as a segregated account(s) and held by a
Federal or State chartered depository institution or trust company in trust for
the benefit of the Certificateholders; provided, however, that such depository
institution or trust company has a long-term rating in one of the four highest
categories by the Rating Agency.
"Eligible Investments": With respect to any Series, unless otherwise
specified in the related Supplement, any one or more of the following
obligations or securities; provided, however, that the total stated return
specified by the terms of each such obligation or security is at least equal to
the purchase price thereof; and provided further that no such instrument may
carry the symbol "r" from S&P in its rating:
(i) direct obligations of, and obligations fully guaranteed by, the
United States, the Federal Home Loan Mortgage Corporation, the Federal
National Mortgage Association, the Federal Farm Credit System or any agency
or instrumentality of the United States the obligations of which are backed
by the full faith and credit of the United States; provided, however, that
obligations of, or guaranteed by, the Federal Home Loan Mortgage
Corporation, the Federal National Mortgage Association or the Federal Farm
Credit System shall be Eligible Investments only if, at the time of
investment, such investment has the rating specified in such Supplement for
Eligible Investments;
(ii) demand and time deposits in, certificates of deposit of, or
banker's acceptances issued by any depository institution or trust company
(including the Trustee or any agent of the Trustee acting in their
respective commercial capacities) incorporated under the laws of the United
States or any State and
5
subject to supervision and examination by Federal and/or State banking
authorities so long as the commercial paper and/or the short-term debt
obligations of such depository institution or trust company (or, in the
case of a depository institution which is the principal subsidiary of a
holding company, the commercial paper or other short-term debt obligations
of such holding company) at the time of such investment or contractual
commitment providing for such investment have the rating specified in such
Supplement for Eligible Investments; provided, however, that such rating
shall be no lower than the lower of the rating on the Underlying Securities
or the Trust Certificates at the time of purchase of the investments;
(iii) securities bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States or any State
that have the rating specified in such Supplement for Eligible Investments
at the time of such investment or contractual commitment providing for such
investment; provided, however, that such rating shall be no lower than the
lower of the rating on the Underlying Securities or the Trust Certificates;
and provided further that securities issued by any particular corporation
will not be Eligible Investments to the extent that investment therein will
cause the then outstanding principal amount of securities issued by such
corporation and held as part of the Trust for such Series to exceed 10% of
the aggregate outstanding principal balances and amounts of all the
Underlying Securities and Eligible Investments held as part of the Trust
for such Series; and
(iv) commercial paper having at the time of such investment the rating
specified in the Supplement for Eligible Investments.
"Entitlement Holder": As defined in Section 8-102(a)(7) of the UCC.
"Event of Default": With respect to any Series (or Class within
such Series), as specified in the related Supplement.
"Exchange Act": The Securities Exchange Act of 1934, as amended.
"Exchange Rate Agent": As specified in the Supplement.
"Executive Officer": With respect to any limited liability company
or corporation, the chief executive officer, the chief operating officer, the
chief financial officer, the president, any vice president, the secretary or the
treasurer of such limited liability company or corporation; with respect to any
partnership, any general partner xxxxxxx.
"Extraordinary Trust Expenses": Any and all costs, expenses or
liabilities arising out of the establishment, existence or administration of the
Trust, other than (i) Ordinary Expenses, and (ii) costs and expenses payable by
a particular Certificateholder, the Trustee or the Depositor pursuant to this
Trust Agreement.
"Fed": The Federal Reserve Bank of New York.
"Fed Member Securities Account": In respect of any Person, an
account in the name of such Person at the Fed, to which account Book-Entry
Securities held for such Person are or may be credited.
"Federal Book-Entry Regulations": (a) the Federal regulations
contained in Subpart B ("Treasury/Reserve Automated Debt Entry System (TRADES)"
governing Book-Entry Securities consisting of U.S. Treasury bonds, notes and
bills) and Subpart D ("Additional Provisions") of 31 C.F.R. Part 357, 31 C.F.R.
ss. 357.10 through ss. 357.14 and ss. 357.41 through ss. 357.44 (including
related defined terms in 31 C.F.R. ss. 357.2) and (b) to the extent
substantially identical to the federal regulations referred to in clause (a)
above (as in effect from time to time), the federal regulations governing other
Book-Entry Securities.
"Final Scheduled Distribution Date": With respect to any
Certificate, the date on which all the unpaid principal of (and premium, if any,
on) and interest on such Certificate is scheduled, without giving effect to any
prepayment, exchange or early termination, to become due and payable as provided
therein and in the applicable Supplement.
6
"Financial Asset": As defined in Section 8-102(a)(9) of the UCC.
"Fitch": Fitch Investors Service, L.P., and any successor thereof.
"Fixed Pass-Through Rate": With respect to any Fixed Rate
Certificate, as defined in the related Supplement.
"Fixed Rate Certificate": A Certificate that provides for a payment
of interest at a Fixed Pass-Through Rate.
"Floating Pass-Through Rate": With respect to any Floating Rate
Certificate, as defined in the related Supplement.
"Floating Rate Certificate": A Certificate that provides for the
payment of interest at a Floating Pass-Through Rate determined periodically by
reference to a formula specified in the related Supplement.
"Global Security": A registered Certificate evidencing all or part
of a Series (or Class within such Series), issued to the Depository for such
Series or Class in accordance with Section 5.08 and bearing the legend
prescribed therein.
"Grant": To grant, bargain, sell, warrant, alienate, remise, demise,
release, convey, assign, transfer, deposit, set over and confirm to the Trustee
pursuant to these Standard Terms and the applicable Supplement; and the terms
"Granted" and "Granting" have the meanings correlative to the foregoing.
"Holder": The Person in whose name a Certificate or Retained
Interest is registered in the Certificate Register on the applicable Record
Date. Where the context requires, "Holder" may refer to the person entitled to
exercise the Voting Rights accompanying a Certificate.
"Independent": When used with respect to any Person means that such
Person (1) is in fact independent of the Depositor and of any Affiliate, (2)
does not have any direct or indirect material financial interest in the
Depositor or in any Affiliate and (3) is not connected with the Depositor or any
Affiliate as an officer, employee, promoter, underwriter, trustee, partner,
director or person performing similar functions.
"Investment Property": As defined in Section 9-115 of the UCC.
"Letter of Credit": With respect to any Series (or Class within such
Series), the letter of credit, if any, providing for the payment of all or a
portion of amounts due in respect of such Series (or Class), issued to the
Trustee for the benefit of the Holders of such Series (or Class), issued by the
related Credit Support Provider, all as specified in the related Supplement.
"Limited Guarantor": With respect to any Series (or Class within
such Series), a Person specified in the related Supplement as providing a
guarantee or insurance policy or other credit enhancement supporting the
distributions in respect of such Series (or Class within such Series) as and to
the extent specified in such Supplement.
"Limited Guaranty": With respect to any Series (or Class within such
Series), any guarantee of, or insurance policy or other comparable form of
credit enhancement with respect to, amounts required to be distributed in
respect of such Series (or Class) or payments under all or certain of the
Underlying Securities relating to such Series or Class, executed and delivered
by a Limited Guarantor in favor of the Trustee, for the benefit of the
Certificateholders, as specified in the related Supplement.
"Liquidation Price": If applicable with respect to any Series, the
price at which the Market Agent sells the Underlying Securities on behalf of the
Trustee, as specified in the applicable Supplement.
"Liquidation Proceeds": The amounts received by the Trustee in
connection with (i) the liquidation of a defaulted Underlying Security,
collateral, if any, related thereto, or Related Asset or (ii) the repurchase,
substitution or sale of an Underlying Security or Related Asset.
7
"Market Agent": The market agent or market agents, if any, appointed
pursuant to Section 8.01, and its or their successors or assigns.
"Market Agent Agreement": With respect to any Series, the agreement,
if any, dated as of the Closing Date, between the Trustee and the Market Agent,
the form of which will be attached to the related Supplement, and any similar
agreement with a successor Market Agent, in each case as from time to time
amended or supplemented.
"Xxxxxxx Xxxxx & Co.": Xxxxxxx Xxxxx & Co., a Delaware corporation.
"Minimum Wire Denomination": $10,000,000 or the equivalent in any
Specified Currency.
"Moody's": Xxxxx'x Investors Service, Inc. and any successors
thereto.
"Notional Amount": With respect to any Class of Certificates, if
applicable, the initial notional amount specified in the related Supplement on
which distributions of interest may be determined at the applicable Pass-Through
Rate, as the same may be adjusted as specified in such Supplement.
"Officer's Certificate": A certificate signed by any (or, if
specified in these Standard Terms or any Supplement, more than one) Executive
Officer of the Depositor, and delivered to the Trustee.
"Opinion of Counsel": A written opinion of counsel, who may, except
as otherwise expressly provided in this Trust Agreement, be counsel for the
Depositor acceptable to the Trustee, except that any opinion of counsel relating
to the qualification of any account required to be maintained pursuant to this
Trust Agreement as an Eligible Account must be an opinion of counsel who is in
fact Independent of the Depositor.
"Optional Exchange": shall mean the exchange of Certificates of any
Series (or Class within such Series) for a pro rata portion of the Deposited
Assets of the related Trust.
"Optional Exchange Date": With respect to any Series (or Class
within such Series), as defined, if applicable, in the related Supplement.
"Optional Redemption": The right of an Underlying Securities Issuer
to redeem such Underlying Securities in accordance with the terms of the
Underlying Securities Indenture.
"Ordinary Expenses": The Trustee's customary fee for its services as
Trustee, as set forth in the related Supplement, including but not limited to
(i) the costs and expenses of preparing, sending and receiving all reports,
statements, notices, returns, filings, solicitation of consent or instructions,
or other communications required by this Trust Agreement, (ii) the costs and
expenses of holding and making ordinary collection or payments on the assets of
the Trust and of determining and making distributions, (iii) the costs and
expenses of the Trust's or Trustee's counsel, accountants and other experts for
ordinary or routine consultation or advice in connection with the establishment,
administration and termination of the Trust, and (iv) any other costs and
expenses that are, or reasonably should have been, expected to be incurred in
the ordinary course of administration of the Trust.
"Outstanding": With respect to Certificates of a specified Series
(or Class within such Series), as of any date of determination, all such
Certificates theretofore executed, authenticated and delivered under these
Standard Terms and the related Supplement except:
(i) Certificates theretofore cancelled by the Certificate Registrar;
and
(ii) Certificates, including Predecessor Certificates, in exchange for
or in lieu of which other Certificates have been executed, authenticated
and delivered pursuant to this Trust Agreement, unless proof satisfactory
to the Trustee is presented that any such Certificates are held by a bona
fide purchaser in whose hands such Certificates are valid obligations of
the Trust;
8
provided, however, that in determining whether any request, demand,
authorization, direction, notice, consent or waiver hereunder has been given by
the required percentage of the aggregate Voting Rights, Voting Rights
accompanying Certificates beneficially owned by the Depositor, the Trustee, or
any Affiliate thereof shall be disregarded and deemed not to be Outstanding, and
such Voting Rights shall not be taken into account in determining whether the
requisite percentage of aggregate Voting Rights necessary to effect any such
consent or take any such action has been obtained except that, in determining
whether the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Certificates with
respect to which the Depositor has provided the Trustee an Officer's Certificate
stating that such Certificates are so owned shall be so disregarded.
Certificates so owned that have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to such Certificates.
"Participant": A broker, dealer, bank, other financial institution
or other Person for whom from time to time a Depository effects book-entry
transfers and pledges of securities deposited with the Depository.
"Pass-Through Rate": With respect to any Series (or Class within
such Series) (except certain Discount Certificates and Certificates entitled to
nominal or no interest distributions), the annual rate at which interest accrues
on the Certificates of such Series (or Class), which may be a fixed rate or a
floating rate of interest, determined upon the basis and in the manner specified
in the related Supplement.
"Paying Agent": As defined in Section 5.13.
"Person": Any individual, limited liability company, corporation,
partnership, joint venture, association, joint stock company, trust (including
any beneficiary thereof), unincorporated organization or government or any
agency or political subdivision thereof.
"Predecessor Certificate": As defined in Section 5.05.
"Prepaid Ordinary Expenses": The amount (if any) paid by the
Depositor to the Trustee on or before the Closing Date to cover Ordinary
Expenses, as specified in the related Supplement.
"Proceeding": Any suit in equity, action at law or other judicial
or administrative proceeding.
"Rating Agency": With respect to any Series or Class within such
Series), each nationally recognized statistical rating organization, specified
in the related Supplement, that initially rates the Certificates of such Series
(or Class within such Series).
"Rating Agency Condition": With respect to any action or occurrence,
unless otherwise specified in the applicable Supplement, that each Rating Agency
shall have been given 10 days (or such shorter period acceptable to each Rating
Agency) prior written notice thereof and that each Rating Agency shall have
notified the Depositor and the Trustee in writing that such action or occurrence
will not result in a reduction or withdrawal of the then current rating of any
Certificate of the applicable Series.
"Realized Loss": With respect to any defaulted and liquidated
Underlying Security, the excess, if any, of (x) the price paid by the Depositor
for such Underlying Security plus expenses incurred by the Trustee in connection
with the practices and procedures referred to in Section 3.07(b) of these
Standard Terms, to the extent reimbursable under these Standard Terms and the
related Supplement, over (y) Liquidation Proceeds with respect thereto.
"Record Date": With respect to any Distribution Date for any Series
(or Class within such Series), the date specified in the related Supplement.
"Related Assets": Any assets held by a Trust the return of which is
linked to one or more Underlying Securities and which, if applicable, shall be
described in the related Supplement or a schedule thereto.
9
"Required Percentage--Amendment": Unless otherwise specified in the
related Supplement, if a Rating Agency Condition is specified in such Supplement
and such Rating Agency Condition is met, or, if a Rating Agency Condition is not
so specified in such Supplement, 66-2/3% of the aggregate Voting Rights of such
Series, and 100% otherwise.
"Required Percentage--Direction of Trustee": Unless otherwise
specified in the related Supplement, 66-2/3% of the aggregate Voting Rights of
such Series.
"Required Percentage--Remedies": Unless otherwise specified in the
related Supplement, 66-2/3% of the aggregate Voting Rights of such Series.
"Required Percentage--Removal of Securities Intermediary": Unless
otherwise specified in the related Supplement, more than 50% of the aggregate
Voting Rights of such Series.
"Required Percentage--Removal of Trustee": Unless otherwise
specified in the related Supplement, more than 50% of the aggregate Voting
Rights of a Series.
"Required Percentage--Waiver": Unless otherwise specified in the
related Supplement, 66-2/3% of the aggregate Voting Rights of a Series.
"Required Principal": As determined for any Distribution Date for a
given Series (or Class within such Series), unless otherwise specified in the
related Supplement, the amounts on deposit in the Certificate Account allocable
to principal payments on the Underlying Securities (including from Credit
Support, if any, and Advances, if any, but excluding amounts in respect of
principal payments to the extent that Advances with respect thereto were
distributed as Required Principal on a prior Distribution Date) and required to
be distributed in respect of the Certificates of such Series (or Class) in
accordance with the terms of such Certificates and such related Supplement.
"Requisite Reserve Amount": As of any date with respect to any
Series (or Class within such Series), the amount, if any, required to be
maintained in the Reserve Account, if any, for such Series or Class as specified
in or determined pursuant to the related Supplement.
"Reserve Account": An Eligible Account, if any, created and
maintained pursuant to Section 3.06.
"Responsible Officer": With respect to the Trustee, any officer
within the Corporate Trust Office, including any Managing Director, Senior Vice
President, Vice President, Assistant Vice President, Assistant Secretary or any
other officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers and also, with respect to a
particular matter, any other officer to whom such matter is referred because of
such officer's actual knowledge of and familiarity with the particular subject.
"Retained Interest": If applicable, with respect to any Underlying
Security, an ownership interest in and a right to a portion of the payments
thereon by the obligor thereof, as specified in the related Supplement, held by
the Person so specified in such Supplement.
"Sale Procedures": Unless otherwise specified in the Supplement,
shall mean that, with respect to any sale of one or more Underlying Securities
or Related Assets, the Market Agent, on behalf of the Trust, shall sell such
Underlying Securities or Related Assets to the highest bidders among not less
than two solicited bidders for such Underlying Securities or Related Assets (one
of which bidders may include Xxxxxxx Xxxxx & Co. or any Affiliate thereof;
provided, however, that neither Xxxxxxx Xxxxx & Co. nor any of its Affiliates
will be under any obligation to bid, and which bidders need not be limited to
recognized broker dealers). In the sole judgment of the Market Agent, bids may
be evaluated on the basis of bids for a single Underlying Security or Related
Asset, a portion of the Underlying Securities or Related Assets, or all of the
Underlying Securities or Related Assets being sold or any other basis selected
in good faith by the Market Agent.
"S&P": Standard & Poor's Ratings Services, and any successor
thereof.
10
"Securities Account": As defined in Section 8-501(a) of the UCC.
"Securities Control": "Control" as defined in Section 8-106 of the
UCC and, for purposes of determining an interest in investment property under
UCC Article 9, Section 9-115(1)(e) of the UCC.
"securities intermediary": As defined in Section 8-102(a)(14) of the
UCC and, in respect of any Book-Entry Security, a "securities intermediary" (as
defined in 31 C.F.R. ss. 357.2 or, as applicable to such Book-Entry Security,
the corresponding Federal Book-Entry Regulations).
"Securities Intermediary": With respect to any Series, the
Securities Intermediary shall be the Person so specified in the applicable
Supplement until a successor Person shall have become the Securities
Intermediary pursuant to the applicable provisions of these Standard Terms and
the applicable Supplement, and thereafter "Securities Intermediary" shall mean
such successor Person.
"Security": As defined in Section 8-102(a)(15) of the UCC.
"Security Certificate": As defined in Section 8-102(a)(9) of the
UCC.
"Security Entitlement": As defined in Section 8-102(a)(17) of the
UCC or, in respect of any Book-Entry Security, as defined in 31 C.F.R. Section
357.2 (or, as applicable to such Book-Entry Security, the corresponding Federal
Book-Entry Regulations).
"Series": A separate series of Certificates issued pursuant to these
Standard Terms and a related Supplement, which series may be divided into two or
more Classes, as provided in such Supplement.
"Specified Currency": As specified in the related Supplement for the
applicable Series or Class, which may be a currency issued by the government of
any country or a composite currency the value of which is determined by
reference to the values of the currencies of any group of countries. If not
specified in the related Supplement, the Specified Currency shall be Dollars.
"State": Any one of the 50 states of the United States, or the
District of Columbia.
"Supplement": An agreement incorporating these Standard Terms that
authorizes the issuance of a particular Series (and each Class within such
Series) of Certificates.
"Surety Bond": If so specified in the Supplement with respect to any
Series (or Class within such Series), the surety bond providing for the
distribution under certain circumstances specified in such Supplement of amounts
to the Certificateholders of such Series (or Class), which surety bond will be
issued to the Trustee for the benefit of such Certificateholders by the related
Credit Support Provider, all as specified in such Supplement.
"Swap Agreement": If so specified in the Supplement with respect to
any Series, the ISDA Master Agreement dated as of the Closing Date by and
between the Trust and the Swap Counterparty, as the same may be amended or
supplemented from time to time as provided therein.
"Swap Counterparty": If so specified in the Supplement with respect
to any Series (or Class within such Series), as specified in such Supplement.
"Swap Distribution Amount": If so specified in the Supplement with
respect to any Series, all amounts then due and owing to the Swap Counterparty
pursuant to the Swap Agreement, other than Swap Termination Payments.
"Swap Guarantee": If so specified in the Supplement with respect to
any Series, the guarantee issued by the Swap Guarantor in favor of the Trust
substantially in the form attached as an exhibit to the Swap Agreement.
11
"Swap Guarantor": If so specified in the Supplement with respect to
any Series, the guarantor specified as such in such Supplement.
"Swap Receipt Amount": If so specified in the Supplement with
respect to any Series, all amounts due and owing to the Trust pursuant to the
Swap Agreement other than Swap Termination Payments.
"Swap Termination Payment": If so specified in the Supplement with
respect to any Series, the amount payable by the Swap Counterparty to the Trust,
or by the Trust to the Swap Counterparty, pursuant to the Swap Agreement.
"Tax Event": The right of an Underlying Securities Issuer to shorten
the maturity of or repurchase such Underlying Securities, in accordance with the
terms of the Underlying Securities Indenture, due to a change in the treatment
of such Underlying Securities under the Code.
"Trust": With respect to any Series, the segregated asset or pool of
assets subject hereto, constituting the trust created hereby and by the related
Supplement and to be administered hereunder and thereunder, consisting of those
Deposited Assets, the Credit Support, if applicable, and all sums distributed in
respect thereof that are specified as being part of the Trust for such Series in
the related Supplement, all for the benefit of the Certificateholders of such
Series as of any particular time.
"Trust Agreement": With respect to each Series, these Standard Terms
and all amendments hereof and, unless the context otherwise requires, the
related Supplement and all amendments thereto.
"Trustee": With respect to any Series, the Person so specified in
the applicable Supplement until a successor Person shall have become the Trustee
pursuant to the applicable provisions of these Standard Terms and the applicable
Supplement, and thereafter "Trustee" shall mean such successor Person.
"Trustee's Fed Member": Any Person that is eligible to maintain a
Fed Member Securities Account in such Person's name with the Fed and through
which the Trustee holds Book-Entry Securities.
"TIA": The Trust Indenture Act of 1939, as amended, as the same is
in force and effect as of the date hereof.
"UCC": The Uniform Commercial Code as in effect from time to time in
the State of New York and any successor statute.
"Underlying Securities Indenture": The indenture pursuant to which
the Underlying Securities were issued, as identified in the Underlying
Securities Schedule.
"Underlying Securities Issuer": With respect to an Underlying
Security, the issuer thereof (including, if applicable, the guarantor of the
Underlying Security), as identified in the Underlying Securities Schedule.
"Underlying Securities Schedule": Schedule I to the Supplement.
"Underlying Security" or "Underlying Securities": With respect to
any Series, the asset or assets identified in the Underlying Securities
Schedule. The Underlying Securities for any Series or the related Trust shall
not constitute Underlying Securities for any other Series or any other Trust.
"Underlying Security Interest Payment Date": With respect to an
Underlying Security, each date specified in the Underlying Securities Schedule
as a date on which interest is scheduled, as of the Closing Date, to be payable
by or on behalf of the Underlying Securities Issuer on such Underlying Security
in accordance with its terms.
"United States": The United States of America (including the
States), its territories, its possessions and other areas subject to its
jurisdiction.
"Voting Rights": The voting rights with respect to the Underlying
Securities, which voting rights shall be allocated to Certificateholders of each
Class within a given
12
Series (and to the holders of the Retained Interest and Call Right, if any) in
accordance with the Allocation Ratio.
Section 1.02. Rules of Construction. Unless the context otherwise
requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning assigned
to it in accordance with generally accepted accounting principles as in
effect in the United States from time to time;
(iii) "or" is not exclusive;
(iv) the words "herein", "hereof", "hereunder" and other words of
similar import refer to this Trust Agreement as a whole and not to any
particular Article, Section or other subdivision;
(v) "including" means including without limitation; and
(vi) words in the singular include the plural and words in the plural
include the singular.
Section 1.03. Compliance Certificates and Opinions; Record Date. a)
Upon any application or request by the Depositor to the Trustee to take any
action under any provision of this Trust Agreement other than the initial
issuance of the Certificates, the Depositor shall furnish to the Trustee an
Officer's Certificate stating that, in the opinion of the signer thereof, all
conditions precedent, if any, provided for in this Trust Agreement relating to
the proposed action have been complied with and an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent, if any, have
been complied with, except that in the case of any such application or request
as to which the furnishing of such documents is specifically required by any
provision of this Trust Agreement relating to such particular application or
request, no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Trust Agreement (other than a
certificate provided pursuant to Section 3.10(d)) shall include:
(i) a statement that the individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(ii) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(iii) a statement that, in the opinion of such individual, he or she
has made such examination or investigation as is necessary to enable him
or her to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(iv) a statement as to whether, in the opinion of such individual,
such condition or covenant has been complied with.
(b) The Depositor may at its option by delivery of an Officer's
Certificate to the Trustee set a record date to determine the Holders entitled
to give any consent, request, demand, authorization, direction, notice, waiver
or other act. Notwithstanding TIA Section 316(c), such record date shall be the
record date specified in such Officer's Certificate, which shall be a date not
more than 30 days prior to the first solicitation of Certificateholders in
connection therewith. If such a record date is fixed, such consent, request,
demand, authorization, direction, notice, waiver or other act may be given
before or after such record date, but only the Holders of record at the close of
business on such record date shall be deemed to be Holders for the purposes of
determining whether the requisite aggregate Voting Rights have authorized or
agreed or consented to such consent, request, demand, authorization, direction,
notice, waiver or other act, and for that purpose the aggregate Voting Rights
shall be computed as of such record date; provided, however, that no such
consent, request, demand, authorization, direction, notice, waiver or other act
by the Holders on such record date shall be deemed
13
effective unless it shall become effective pursuant to the provisions of this
Trust Agreement not later than one year after the record date.
Article II
DECLARATION OF TRUSTS; ISSUANCE OF CERTIFICATES;
PURPOSE AND CLASSIFICATION OF TRUSTS
Section 2.01. Creation and Declaration of Trusts; Assignment of
Deposited Assets. (a) The Depositor, concurrently with the execution and
delivery of the related Supplement, does hereby agree to Grant to the Trustee
for the benefit of the Trustee and the Certificateholders of each given Series
and without recourse, all the right, title and interest of the Depositor,
including any security interest therein for the benefit of the Depositor, in, to
and under the Underlying Securities and other Deposited Assets. Unless otherwise
specified in the Supplement, each such Grant will include all interest, premium
(if any) and principal of, on or with respect to any such Underlying Securities
due after the Cut-off Date and received by the Depositor, and will exclude all
interest, premium (if any) and principal of, on or with respect to any such
Underlying Securities due on or before the Cut-off Date. With respect to any
Concentrated Underlying Security, the Underlying Securities Schedule shall
include information regarding the payment terms of the Concentrated Underlying
Security, the maturity or terms thereof, the rating, if any, thereof and any
other material information with respect thereto.
(b) In connection with each Grant referred to in paragraph (a) of
this Section 2.01, the Depositor shall, not later than the applicable Closing
Date, either
(i) deposit the Underlying Securities for a given Series (except for
the Underlying Securities attributable to such Series that are to be
acquired from a Person other than the Depositor, as specified on the
Underlying Securities Schedule to the applicable Supplement) with the
Trustee by physical delivery of such Underlying Securities duly endorsed,
together with any documents necessary to transfer ownership of such
Underlying Securities, to the Trustee, or
(ii) have ensured that the Underlying Securities have been delivered
to a Clearing Agency, in which event (A) the Securities Intermediary or
its agent, on behalf of the Trustee, has accepted delivery of such
Underlying Securities through such Clearing Agency, and (B) the
Underlying Securities have been credited to a Securities Account of the
Trustee and maintained by the Securities Intermediary on behalf of the
Trustee, and the Securities Intermediary or its agent shall have the
right to hold and maintain such Underlying Securities on deposit with
such Clearing Agency for all purposes of this Trust Agreement.
(c) In the case of each delivery of Underlying Securities referred
to in paragraph (b) of this Section 2.01, the Depositor shall be deemed thereby
to represent and warrant to the Trustee and the Securities Intermediary that:
(i) the Depositor is duly authorized to so deliver the Underlying
Securities;
(ii) the Underlying Securities so delivered are genuine;
(iii) at the time of delivery of the Underlying Securities, such
Underlying Securities are free and clear of any lien, pledge,
encumbrance, right, charge, claim or other security interest (other than
the lien created by this Trust Agreement); and
(iv) such delivery is irrevocable and free of any continuing claim
by the Depositor except such as the Depositor may have as a
Certificateholder.
The above representations and warranties shall survive the delivery
of the Underlying Securities and the Certificates in respect thereof. The
Depositor shall further be deemed by such delivery to have made the
representations that to the Depositor's knowledge but without having made any
independent inquiry, as of the Closing Date, no default or event of default with
respect to the Underlying Securities has occurred and is continuing.
(d) Unless otherwise specified in the related Supplement, the Grant
of the Deposited Assets accomplished by this Trust Agreement is absolute and
shall constitute a
14
sale. In addition, the Trust created hereunder and thereunder shall constitute a
fixed investment trust for federal income tax purposes under Treasury Regulation
Section 301.7701-4, and all parties hereto and thereto agree to treat the Trust,
any distributions therefrom and the beneficial interest in the Certificates
consistently with such characterization. The provisions of this Trust Agreement
shall be interpreted consistently with such characterization.
(e) Any Trust created hereunder shall not engage in any business or
activities other than in connection with, or relating to, the holding,
protecting and preserving of the Deposited Assets and the issuance of the
Certificates, and other than those required or authorized by this Trust
Agreement or incidental to and necessary to accomplish such activities. Any
Trust created hereunder shall not issue or sell any certificates or other
obligations other than the Certificates or otherwise incur, assume or guarantee
any indebtedness for money borrowed.
(f) Anything herein to the contrary notwithstanding, none of the
Trustee, the Securities Intermediary or any of the Certificateholders assumes
any of the obligations of the Depositor or any other Person in respect of the
Underlying Securities.
(g) The Securities Intermediary expressly agrees with the Trustee
and the Certificateholders that, at all times from and after the date hereof,
any and all of the Deposited Assets held by the Securities Intermediary in the
Certificate Account are to be treated as Financial Assets under, and for all
purposes of, UCC Article 8 and UCC Article 9.
15
Section 2.02. Acceptance by Trustee. With respect to each Series,
the Trustee will acknowledge receipt by it, or by a custodian on its behalf, of
the related Underlying Securities now existing or hereafter acquired, and
declares that it will hold such Underlying Securities and all other documents
delivered to it pursuant to this Trust Agreement, and that it will hold all such
assets and such other assets (including Underlying Securities acquired from a
Person other than the Depositor) comprising the Trust for a given Series, in
trust for the exclusive use and benefit of all present and future
Certificateholders of such Series and for the purposes and subject to the terms
and conditions set forth in this Trust Agreement.
Section 2.03. Representations and Warranties of the Depositor. The
Depositor hereby represents and warrants to the Trustee that as of the Closing
Date or as of such other date specifically provided herein or in the applicable
Supplement:
(i) the Depositor is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware;
(ii) with respect to each Supplement, to the Depositor's knowledge
but without having made any independent inquiry, the information set
forth in the Underlying Securities Schedule with respect to each
Underlying Security is true and correct in all material respects at the
date or dates, respecting which, such information is furnished;
(iii) the execution and delivery of this Trust Agreement by the
Depositor and its performance of and compliance with the terms of this
Trust Agreement will not violate the Depositor's certificate of
incorporation or by-laws or constitute a default (or an event which, with
notice or lapse of time, or both, would constitute a default) under, or
result in the breach or acceleration of, any material contract, agreement
or other instrument to which the Depositor is a party or which may be
applicable to the Depositor or any of its assets;
(iv) the Depositor has the full power and authority to enter into
and consummate all transactions contemplated by this Trust Agreement, has
duly authorized the execution, delivery and performance of this Trust
Agreement and has duly executed and delivered this Trust Agreement. This
Trust Agreement, upon its execution and delivery by the Depositor and
assuming due authorization, execution and delivery by the Trustee, will
constitute a valid, legal and binding obligation of the Depositor,
enforceable against it in accordance with the terms hereof, except as
such enforcement may be limited by bankruptcy, insolvency,
reorganization, receivership, moratorium or other laws relating to or
affecting the rights of creditors generally, and by general equity
principles (regardless of whether such enforcement is considered a
Proceeding in equity or at law); and
(v) any additional representations and warranties, if any, that may
be specified in the applicable Supplement.
It is understood and agreed that the representations and warranties
of the Depositor set forth in this Section 2.03 shall survive delivery of the
respective documents and the Underlying Securities to the Trustee and shall
inure to the benefit of the Trustee on behalf of the Certificateholders
notwithstanding any restrictive or qualified endorsement or assignment. Upon
discovery by any of the Depositor or the Trustee of a breach of any of the
foregoing representations and warranties which materially and adversely affects
the interests of the Certificateholders, the party discovering such breach shall
give prompt written notice thereof to the other party.
Section 2.04. Breach of Representation, Warranty or Covenant. Within
90 days of the earlier of discovery by the Depositor or receipt of notice by the
Depositor of a breach of any representation or warranty of the Depositor set
forth in Section 2.03 that materially and adversely affects the interests of the
Certificateholders of a given Series, the Depositor shall cure such breach in
all material respects.
Section 2.05. Agreement to Execute, Authenticate and Deliver
Certificates. With respect to each Series and the related Trust, the Trustee
hereby agrees and acknowledges that it will, concurrently with the Grant to and
receipt by it of the related Underlying Securities, cause to be executed,
authenticated and delivered to or upon the written order of the Depositor, in
exchange for the Underlying Securities and such other assets constituting the
Trust for a given Series, Certificates duly authenticated by or on behalf of the
Trustee in an Authorized Denomination evidencing
16
ownership of the entire Trust for such Series, all in accordance with the terms
and subject to the conditions of Section 5.02.
Section 2.06. Custody and Holding of Deposited Assets. (a) With
respect to each Series, the Trustee shall hold and maintain the Deposited Assets
with the Securities Intermediary in and through, and hereby directs the
Securities Intermediary to credit any and all such Deposited Assets to, the
Certificate Account (all as further provided in this Article II) in such manner
as shall enable the Trustee to be and have the rights of an Entitlement Holder
with respect to, and have sole dominion and control (including, without
limitation, Securities Control) over, such Deposited Assets.
(b) The Securities Intermediary hereby represents, warrants,
covenants and agrees that from and after the Closing Date:
(i) Each Certificate Account is a Securities Account, with the
Trustee (for its benefit and the benefit of the Certificateholders) as
the Entitlement Holder in, and having sole dominion and control
(including, without limitation, Securities Control) over, any and all
Deposited Assets (including, without limitation, any and all assets and
properties referred to in clause (ii) below) in such Certificate Account.
(ii) All assets and properties from time to time transferred or
credited to the Certificate Account constitute Financial Assets.
(iii) The Securities Intermediary is (and will remain) a securities
intermediary and is acting (and will continue to act) as such with
respect to the Certificate Account, the Deposited Assets therein and the
Trustee as Entitlement Holder. Unless otherwise instructed by the Trustee
in writing, the Securities Intermediary will treat the Trustee (for its
benefit and the benefit of the Certificateholders) as entitled to
exercise the rights that comprise the Deposited Assets in each
Certificate Account. Further, the Securities Intermediary is and will
remain (A) a bank, banking institution, financial firm or similar party,
in each case, that regularly accepts in its course of its business
Book-Entry Securities as a custodial service for customers and maintains
Securities Accounts in the name of such customers reflecting ownership of
or interest in such Securities, (B) will maintain its books and records
reflecting such Book-Entry Securities in the State of New York and (C) if
the Trustee maintains one or more Certificate Accounts with the
Securities Intermediary, will have entered into, and will maintain in
full force and effect, an agreement with the Trustee (which, on the date
hereof, is comprised of this Trust Agreement) to the effect that their
respective rights and obligations in respect of each other, said
Underlying Securities and said Certificate Accounts are governed by the
laws of the State of New York.
(iv) The Securities Intermediary shall hold any and all assets and
properties from time to time comprising the Deposited Assets (whether
individually or as part of a fungible bulk) in a manner such that the
Trustee will have dominion and control (including, without limitation,
Securities Control) over such Deposited Assets. The Securities
Intermediary will credit to the appropriate Certificate Account (and will
thereby or by book entry or otherwise identify as being subject to the
Grant to the Trustee hereunder) any and all assets and properties from
time to time comprising the Deposited Assets in accordance with Section
2.06(a) hereof.
(v) To effect the intention of clauses (i) through (iv) above, the
Securities Intermediary or its agent maintains (and will continue to
maintain)
(A) one or more Securities Accounts with the Depository. The
Securities Intermediary or its agent will instruct the Depository to
credit such Securities Accounts of the Securities Intermediary or its
agent with the Depository with the Depository Securities comprising
from time to time the Deposited Assets; and
(B) one or more Fed Member Securities Accounts to which the
Securities Intermediary through its agent will instruct the Fed to
credit, in accordance with the Book-Entry Regulations, all
Book-Entry Securities from time to time comprising the Deposited
Assets.
17
ARTICLE III
ADMINISTRATION OF EACH TRUST
Section 3.01. Administration of Each Trust. (a) The Trustee shall
administer the Underlying Securities for each given Trust for the benefit of the
Certificateholders of the related Series. In engaging in such activities, the
Trustee shall follow or cause to be followed collection procedures in accordance
with the terms of these Standard Terms and the applicable Supplement, the
respective Underlying Securities and any applicable Credit Support Instruments.
With respect to each Trust, and subject only to the above-described standards
and the terms of these Standard Terms, the related Supplement and the respective
Underlying Securities and applicable Credit Support Instruments, if any, the
Trustee shall have full power and authority, acting alone or through
Administrative Agents as provided in Section 7.02, to do or cause to be done any
and all things in connection with such administration which it deems necessary
to comply with the terms of these Standard Terms and the applicable Supplement.
(b) The duties of the Trustee shall be performed in accordance with
applicable local, State and Federal law, and the Trustee shall, at the direction
of the Depositor, make any and all filings, reports, notices or applications
with (as prepared by the Depositor), and seek any comments and authorizations
from, the Commission and any State securities authority on behalf of the Trust
for each Series.
Section 3.02. Collection of Certain Underlying Security Payments.
With respect to any Series or Class, the Trustee shall make reasonable efforts
to collect all payments required to be made pursuant to the terms of the
Underlying Securities in a manner consistent with the terms of this Trust
Agreement, such Underlying Securities and any related Credit Support
Instruments, if applicable.
Section 3.03. Certificate Accounts. (a) For each Series, the Trustee
shall establish and maintain one or more Eligible Accounts (collectively, the
"Certificate Accounts"), which shall be Securities Accounts and shall be held in
trust in the name of the Trustee for its benefit and the benefit of
Certificateholders of such Series. The Trustee on behalf of such
Certificateholders shall possess all right, title and interest in all funds on
deposit from time to time in each Certificate Account and in all proceeds
thereof. With respect to each Series and in accordance with Section 2.06, the
Certificate Accounts shall be under the sole dominion and control (including,
without limitation, Securities Control) of the Trustee for the benefit of the
related Certificateholders. With respect to each Series, not later than the
close of business on the Business Day on which the Trustee receives such amounts
in the form of immediately available funds (so long as such funds are received
by the Trustee by 3:00 p.m., New York City time, and on the next Business Day
otherwise), the Trustee shall deposit or cause to be deposited in the
Certificate Accounts all amounts received by it with respect to the Deposited
Assets, any Credit Support and all Liquidation Proceeds related to such Series
including:
(i) all payments on account of principal of such Underlying
Securities;
(ii) all payments on account of interest on such Underlying
Securities;
(iii) all payments on account of premium (if any) on such Underlying
Securities;
(iv) any payments in respect of any such Credit Support;
(v) any Advances made as required pursuant to Section 4.04; and
(vi) any interest or investment income earned on funds deposited in
the related Accounts.
Unless otherwise specified in the applicable Supplement, it is
understood and agreed that payments in the nature of prepayment or redemption
penalties, late payment charges, default interest or reinvestment income which
may be received by the Trustee shall be deposited by the Trustee in the
Certificate Account and shall not be retained by the Trustee for its own
account.
If, at any time, the Certificate Account for any Series ceases to be
an Eligible Account, the Trustee shall within five Business Days (or such longer
period, not to exceed 30 calendar days, as to which the Rating Agency Condition
is met) establish a new
18
Certificate Account meeting the conditions specified above and the Trustee shall
within five Business Days transfer any cash and any investments on deposit in
the Certificate Account to such new Certificate Account, and from the date such
new Certificate Account is established, it shall be the Certificate Account for
such Series.
(b) The Trustee shall give notice to the Depositor of the location
of each Eligible Account constituting the Certificate Account and prior to any
change thereof, if such Eligible Account is or will be located at an institution
other than United States Trust Company of New York.
Section 3.04. Distribution or Sale of the Underlying Securities. If
(a) there occurs a payment default on the Underlying Securities, (b) there
occurs an acceleration of the date of maturity of the Underlying Securities, or
(c) the Underlying Securities Issuer of any Concentrated Underlying Securities
ceases to be a reporting company under the Exchange Act, then the Trustee, upon
receiving notice of the events set forth in (a), (b) or (c) shall exercise one
of the following remedies, in accordance with the Distribution Election:
(i) immediately direct the Market Agent to sell the Underlying
Securities and a pro rata portion of the Related Assets held by such
Trust, in accordance with the Sale Procedures, and the Liquidation
Proceeds, if any, shall be deposited into the Certificate Account for
distribution in accordance with the Allocation Ratio on the first
Business Day following such deposit into the Certificate Account;
(ii) distribute the Underlying Securities and a pro rata portion of
the Related Assets in accordance with the Allocation Ratio to each
Holder's last address as it appears in the Certificate Register within
three Business Days of receiving the notice referred to in the first
sentence of this Section 3.04; or
(iii) provide that the Holders of a given Series or Class may vote
in favor of either (i) or (ii), in accordance with the procedures set
forth in the applicable Supplement.
In the case of a sale by the Market Agent of Underlying Securities
and Related Assets pursuant to clause (i) of this Section 3.04, the Trustee
shall deliver such Underlying Securities and Related Assets to the purchaser of
such Underlying Securities and Related Assets only against payment in same day
funds and the Trustee shall deposit the same into the Certificate Account.
19
Section 3.05. Investment of Funds in the Accounts. The Trustee may
direct any depository institution maintaining the Certificate Account or the
Reserve Account, if any, for the Series and any other segregated Eligible
Account, which Eligible Account shall be a Securities Account the contents of
which are held for the benefit of Certificateholders of such applicable Series
(each, an "Account"), to invest the funds therein at the specific written
direction of the Depositor in one or more Eligible Investments bearing interest
or sold at a discount, which shall be held to maturity unless payable on demand
and which funds shall not be reinvested upon the maturity or demand for payment
of such Eligible Investment. If the Depositor does not provide any investment
directions by 10:00 a.m. on any Business Day, funds held in any Account will be
invested in the Eligible Investments specified in clause (iv) of the definition
thereof until receipt of investment directions to the contrary. Investments of
such funds shall be invested in Eligible Investments that will mature so that
such funds will be available for distribution on the next Distribution Date.
Except as otherwise provided in the applicable Supplement, any earnings with
respect to such Eligible Investments shall be paid to, and any losses with
respect to such Eligible Investments shall be solely for the account of, the
Certificateholders in proportion to their interest in the invested funds. In the
event amounts on deposit in an Account are at any time invested in an Eligible
Investment payable on demand, the Securities Intermediary, on behalf of the
Trustee and the Trust, shall:
(i) consistent with any notice required to be given thereunder,
demand that payment thereon be made on the last day such Eligible
Investment may otherwise mature hereunder in an amount equal to the
lesser of (1) all amounts then payable thereunder and (2) the amount
required to be withdrawn on such date; and
(ii) demand same day payment of all amounts due thereunder upon a
determination by the Trustee that such Eligible Investment would not
constitute an Eligible Investment in respect of funds thereafter on
deposit in any Account.
None of the Trustee, the Depositor or the Securities Intermediary shall in any
way be held liable by reason of any insufficiency in any Account resulting from
any loss on any Eligible Investment made in accordance with this Trust
Agreement.
Section 3.06. Maintenance of Credit Support. (a) On the applicable
Closing Date, the Trustee at the written direction of the Depositor or, if so
specified in the applicable Supplement, the Depositor shall, to the extent
specified in the applicable Supplement, establish and maintain, or enter into,
as applicable, in the name of the Trustee, either as part of the related Trust
or outside it, for the benefit of the Certificateholders of the related Series,
the Credit Support specified in the applicable Supplement. To the extent
specified in the applicable Supplement, the Depositor will make or cause to be
made any initial deposit to the Certificate Account or any Reserve Account
(which shall be an Eligible Account) for the related Series as of the Closing
Date. Unless the Supplement for a given Series provides otherwise, if a Reserve
Account exists for such Series, collections with respect to the Underlying
Securities for such Series not distributed to the Certificateholders of such
Series shall be deposited in the Reserve Account. The Reserve Account, if any,
shall be an asset of the Depositor (and the income earned on any amounts held in
the Reserve Account shall be allocable to the Depositor, who agrees to include
any such income in its gross income for all federal, state and local income and
franchise tax purposes) and will not be a part of or otherwise be included in
the Trust but will be held for the benefit of the Certificateholders.
(b) Amounts on deposit in the Reserve Account and amounts available
pursuant to any other Credit Support for such Series shall be applied by the
Trustee to make distributions of principal of and premium (if any) and interest
on the Certificates of such Series as required pursuant to Section 4.01 and the
applicable Supplement to the extent that funds are not otherwise available for
such purpose. If specified in such Supplement, immediately after each
Distribution Date, amounts on deposit in the Reserve Account for such Series in
excess of a specified amount shall be paid to the Person so specified in such
Supplement.
Section 3.07. Realization upon Defaulted Underlying Securities. (a)
The Trustee on behalf of the Certificateholders, shall assert claims under each
applicable Credit Support Instrument, and shall take such reasonable steps as
are necessary to receive payment or to permit recovery thereunder with respect
to any defaulted Underlying Securities, subject in all cases to the provisions
of Article VII hereof.
(b) Unless otherwise provided in the related Supplement, if the
Trustee is unable to obtain full recovery in respect of a defaulted Underlying
Security and any
20
related Credit Support Instrument pursuant to Section 3.07(a), the Trustee shall
follow or cause to be followed such normal practices and procedures as it deems
necessary or advisable to realize upon such defaulted Underlying Security and
such Credit Support Instrument, subject in all cases to the provisions of
Article VII hereof.
(c) If the Liquidation Proceeds of a defaulted Underlying Security
are less than the sum of (i) the outstanding principal balance of the defaulted
Underlying Security and (ii) the aggregate amount of expenses incurred by the
Trustee in connection with the practices and procedures referred to in paragraph
(b) of this Section 3.07 to the extent reimbursable under these Standard Terms
and the related Supplement, the Trust for the applicable Series shall recognize
a Realized Loss equal to the amount of such difference. Any such Realized Loss
shall be allocated in accordance with Section 4.05.
Section 3.08. Retained Interest. The Retained Interest, if any, in
any Underlying Security shall initially be held by the Person so specified in
the related Supplement as and to the extent specified therein.
Section 3.09. Access to Certain Documentation. The Trustee shall
provide to any Federal, State or local regulatory authority that may exercise
authority over any Certificateholder access to the documentation in the
Trustee's possession regarding the Underlying Securities required by applicable
laws and regulations. Such access shall be afforded without charge, but only
upon reasonable written request and during normal business hours at the offices
of the Trustee designated by it. In addition, access to the documentation in the
Trustee's possession regarding the Underlying Securities related to a given
Series (or Class within such Series) will be provided to any Certificateholder
of such Series (or Class) upon reasonable written request during normal business
hours at the offices of the Trustee designated by it at the expense of the
Certificateholder requesting such access.
Section 3.10. Reports by the Depositor. The Depositor shall:
(i) file with the Trustee, within 30 days after the Depositor is
required to file the same with the Commission, copies of the annual
reports and of the information, documents and other reports (or copies
of such portions of any of the foregoing as the Commission may from
time to time by rules and regulations prescribe) which the Depositor
is required to file with the Commission pursuant to Section 13 or
Section 15(d) of the Exchange Act; or, if the Depositor is not
required to file information, documents or reports pursuant to either
of such Sections, then to file with the Trustee and the Commission, in
accordance with rules and regulations prescribed by the Commission,
such of the supplementary and periodic information, documents and
reports which may be required pursuant to Section 13 of the Exchange
Act in respect of a security listed and registered on a national
securities exchange as may be prescribed in such rules and
regulations;
(ii) file with the Trustee and the Commission, in accordance with
the rules and regulations prescribed by the Commission, such additional
information, documents and reports with respect to compliance by the
Depositor with the conditions and covenants provided for in this Trust
Agreement, as may be required by such rules and regulations, certificates
or opinions of independent accountants, conforming to the requirements of
TIA Section 314(e);
(iii) supply to the Trustee (and the Trustee shall transmit to all
Certificateholders, in the manner and to the extent provided in TIA
Section 313(c)), such summaries of any information, documents and reports
required to be filed by the Depositor pursuant to clauses (i) and (ii) of
this Section 3.10 as may be required by rules and regulations prescribed
by the Commission; and
(iv) furnish to the Trustee, not less often than annually, a
certificate from the principal executive, financial or accounting officer
of the Depositor as to his or her knowledge of the Depositor's compliance
with all conditions and covenants under this Trust Agreement. For
purposes of this clause (iv), such compliance shall be determined without
regard to any period of grace or requirement of notice provided under
this Trust Agreement.
Any reports, statements, documents or other information required to be furnished
by the Depositor to the Trustee pursuant to these Standard Terms or any
Supplement shall be deemed to have been delivered to the Trustee if the Trustee
is in possession of such reports, statements, documents or other information at
the time they are to be furnished pursuant to these Standard Terms or any
Supplement.
21
Section 3.11. Charges and Expenses. Except as otherwise provided in
these Standard Terms or the related Supplement, no amounts in the nature of fees
or charges shall be payable by or withheld from the Trust, the Depositor or any
other person and there shall be no recourse or claim against the Trust or the
property of the Trust for all or any part of any fees or charges payable to any
person.
ARTICLE IV
DISTRIBUTIONS AND REPORTS TO CERTIFICATEHOLDERS
Section 4.01. Distributions. (a) On each Distribution Date for a
given Series, the Trustee shall apply Available Funds in the Certificate Account
for such Series in the manner and priority set forth in the Supplement for such
Series. In any event, however, any amounts collected during any period shall be
distributed to the Holders no later than the Distribution Date immediately
following the receipt thereof.
(b) All distributions to Holders shall be payable only from
Available Funds, and no provision of this Trust Agreement shall be deemed to
create any obligation on the part of the Trustee or the Depositor to make any
distribution from any other source.
Section 4.02. Distributions on Certificates. (a) Distributions on
any Certificate that are payable and are punctually paid or duly provided for on
any Distribution Date shall be distributed to the Person in whose name such
Certificate (or one or more Predecessor Certificates) is registered at the close
of business on the related Record Date notwithstanding the cancellation of such
Certificate upon any transfer or exchange subsequent to such related Record
Date.
The distribution of interest and principal on Certificates shall be
made:
(i) if the Certificateholder is a Depository, to the Depository,
which shall credit the relevant Participant's account at such Depository
in accordance with the policies and procedure of the Depository; or
(ii) if the Holder is not a Depository, at the Corporate Trust
Office (except as otherwise specified pursuant to the applicable
Supplement) or, at the option of the Trustee, by check mailed to the
address of the Person entitled thereto as such address shall appear in
the Certificate Register or, if provided pursuant to the applicable
Supplement and in accordance with arrangements satisfactory to the
Trustee, at the option of the registered Holder by wire transfer to an
account designated by the registered Holder. Notwithstanding clause (i)
of this paragraph (a), with respect to a Holder of Certificates not held
in a Depository and having at least the Minimum Wire Denomination, such
payment shall be made by wire transfer of immediately available funds to
the account designated by such Holder in a written request received by
the Trustee not later than 10 days prior to such Distribution Date;
provided, however, that if a wire transfer cannot be made for any reason,
payment shall be made by check. The Trustee shall not be required to send
federal funds wires until any corresponding payments which were not same
day funds when received by it have become same day funds.
(b) Each Certificate delivered under this Trust Agreement upon
transfer of or in exchange for or in lieu of any other Certificate shall carry
the rights to interest accrued and undistributed, and to accrue, that were
carried by such other Certificate.
(c) All computations of interest due with respect to any Certificate
of any Series or Class within such Series shall be made as specified in the
Supplement applicable to that particular Series or Class.
(d) With respect to any computations or calculations to be made
under these Standard Terms, the applicable Supplement and the Certificates,
except as otherwise provided, all percentages resulting from any calculation of
accrued interest will be rounded, if necessary, to the nearest 1/100,000 of 1%
(.0000001), with five one-millionths of a percentage point rounded upward.
(e) The final distribution of principal and/or premium shall be made
upon presentation and surrender of such Certificates at the Corporate Trust
Office.
22
Section 4.03. Reports to Certificateholders. On the fifth Business
Day following each such Distribution Date the Trustee shall forward or cause to
be forwarded to the Depositor, each Holder of such Series, to each Rating Agency
rating such Series and such other Persons as may be specified in such
Supplement, a statement setting forth:
(i) the amounts received by the Trustee as of the last such
statement in respect of principal, interest and premium on the Underlying
Securities, the Swap Receipt Amount, if any, and any other derivatives
transaction that may be entered into by the Trust pursuant to the terms
of these Standard Terms and the related Supplement;
(ii) the Swap Distribution Amount, if any, received by the Trustee
as of such Distribution Date and any other amounts payable pursuant to
any other derivatives transaction that may be entered into by the Trust
pursuant to the terms of these Standard Terms and the related Supplement;
(iii) the amount of compensation received by the Trustee, and any
Administrative Agent, for the period relating to such Distribution Date,
and such other customary and sufficient information as is reasonably
necessary to enable Holders to calculate their federal income tax
liability with respect to the Certificates; provided, however, the
Trustee shall be permitted to seek the advice of counsel and such other
experts as it may deem necessary in its reasonable judgment in order to
determine that information which is reasonably necessary to provide to
the Holders;
(iv) the amount of the distribution on such Distribution Date to
Holders allocable to principal of and premium, if any, and interest on
the Certificates of each such Class and to the Retained Interest, and the
amount of aggregate unpaid interest accrued as of such Distribution Date;
(v) in the case of each Class of Floating Rate Certificates of such
Series, the respective Floating Pass-Through Rate applicable to each such
Class on such Distribution Date, as calculated in accordance with the
method specified in such Certificates and the related Supplement;
(vi) if the Supplement provides for Advances, the aggregate amount
of Advances, if any, included in such distribution, and the aggregate
amount of unreimbursed Advances, if any, at the close of business on such
Distribution Date;
(vii) the aggregate stated principal amount and, if applicable,
notional amount of the Underlying Securities related to such Series, the
current interest rate or rates thereon at the close of business on such
Distribution Date, and the current rating assigned to the Certificates,
as provided to the Trustee in writing in an instrument specifically
referring to this Trust Agreement by the applicable rating agency;
(viii) the aggregate Certificate Principal Balance (or Notional
Amount, if applicable) of each Class of such Series at the close of
business on such Distribution Date, separately identifying any reduction
in such aggregate Certificate Principal Balance (or Notional Amount) due
to the allocation of any Realized Losses on such Distribution Date or
otherwise as may be specified by the Depositor;
(ix) as to any Series (or any Class within such Series) for which
Credit Support has been obtained, the amount or notional amount of
coverage of each element of Credit Support (and rating, if any, thereof)
included therein as of the close of business on such Distribution Date;
and
(x) any other information appropriate for a Series, as specified in
the applicable Supplement.
Within a reasonable period of time after the end of each calendar
year, the Trustee shall furnish to each Person who at any time during each such
calendar year was a Holder a statement containing the information set forth in
clause (iii) above, aggregated for such calendar year during which such person
was a Holder. Such obligation of the Trustee shall be deemed to have been
satisfied to the extent that substantially comparable information shall be
provided by the Trustee pursuant to any requirements of the Code as are from
time to time in effect. The Trustee shall supply to Holders in
23
writing at such Xxxxxx's expense who so request all materials received by the
Trustee from the Underlying Securities Issuer.
Section 4.04. Advances. (a) Unless otherwise specified in the
applicable Supplement, the Trustee shall have no obligation to make Advances (as
defined below) with respect to the Underlying Securities or in favor of the
Holders of any Series (or Class within such Series) of Certificates.
(b) However, as and to the extent provided in the Supplement for a
given Series, and subject to the terms of paragraphs (c) and (d) of this Section
4.04, on or prior to each Distribution Date, the Trustee shall advance or cause
to be advanced in immediately available funds for deposit in the Certificate
Account for such Series an advance (each, an "Advance") in an amount equal,
unless otherwise specified in the related Supplement, to the aggregate of
distributions of principal, premium (if any) and interest due on the Underlying
Securities for such Series (or Class) during the related Collection Period, to
the extent remaining unpaid at the time of such Advance. In satisfaction of its
obligation to make such Advances, the Trustee shall make such Advances from its
own funds and may recover Advances from late collections received by the Trustee
on the applicable Underlying Securities, proceeds from any applicable Credit
Support, if any, and Liquidation Proceeds with respect to the Underlying
Securities for such Series or Class, as specified in the related Supplement, as
to which any such Advance was made.
(c) Notwithstanding any provision herein to the contrary, no Advance
shall be required to be made hereunder if the Trustee reasonably believes that
it will be unable to recover such Advance from related late collections, Credit
Support proceeds, if any, or Liquidation Proceeds with respect to the applicable
Underlying Securities. It is further understood and agreed that the Trustee
shall not be obligated to make any Advances in respect of reductions in the
amount of collections on the Underlying Securities due to bankruptcy proceedings
with respect to the Underlying Securities or the obligors thereof.
(d) Notwithstanding any provision herein to the contrary, unless
otherwise provided in the related Supplement for a given Series, any Advances
made in respect of any Underlying Securities related to such Series (or Class
within such Series) that subsequently are deemed by the Trustee to be
nonrecoverable from related late collections, Credit Support proceeds, if any,
or Liquidation Proceeds may be reimbursed to the Trustee through the application
of amounts on deposit in the Certificate Account for such Series allocable to
any of such Underlying Securities prior to the distributions of interest,
premium (if any) and principal with respect to the Certificates of such Series
or Class.
Section 4.05. Allocation of Realized Losses and Trust Expenses. With
respect to any Series, Realized Losses and Extraordinary Trust Expenses, if any,
shall be allocated on any Distribution Date in accordance with the Allocation
Ratio, provided, however, that distributions pursuant to Section 3.04 shall be
completed as the earliest practicable date.
Section 4.06. Compliance with Withholding Requirements. (a)
Notwithstanding any other provision of this Trust Agreement to the contrary, the
Trustee shall comply with all Federal withholding requirements respecting
distributions to Holders of interest or original issue discount that the Trustee
believes are applicable under the Code. The consent of Holders shall not be
required for such withholding.
(b) Each Holder will provide the Trustee (and, so long as the
Certificates are held at a Depository in the form of Global Certificates, each
Beneficial Owner of the Certificates will provide such Depository and the
Trustee) with evidence that there should not be any withholding tax assessed for
Federal income tax purposes in respect of distributions to such Holder, such
evidence to take the form of a statement, on a duly executed and up-to-date
Internal Revenue Service Form W-8 (or successor form), Form W-9 (or successor
form), or Form 4224 (or successor form), as applicable, that identifies the
Beneficial Owner of the Certificate; provided, however, that for so long as the
Certificates are held at a Depository in the form of Global Certificates, the
Holder shall have no obligation to provide the Trustee with any such evidence
except to the extent it has received such evidence from Beneficial Owners of the
Certificates. The Trustee shall not be required to accept any such Internal
Revenue Service forms if it believes that they are not accurate (but the Trustee
shall not be required to make any independent investigation to determine their
accuracy).
24
(c) If any tax or other governmental charge shall become payable by
or on behalf of the Trustee, including any tax or governmental charge required
to be withheld from any payment by the Trustee under the provisions of any
applicable law or regulation with respect to any Underlying Securities or the
Certificates, such tax or governmental charge shall be payable by the Holder and
may be withheld by the Trustee. The consent of the Holder shall not be required
for such withholding. In the event the Trustee does withhold any amount from
interest or original issue discount distributions or Advances thereof to any
Holder pursuant to Federal withholding requirements, the Trustee shall indicate
in the statement required pursuant to Section 4.03 the amount so withheld.
(d) The Depositor and the Trustee shall have the right to refuse the
surrender, registration of transfer or exchange of any Certificate with respect
to which such tax or other governmental charge shall be payable until such
payment shall have been made by the Holder thereof.
Section 4.07. Optional Exchange. (a) The terms and conditions, if
any, of an Optional Exchange will be specified in the related Supplement;
provided, however, that any right of Optional Exchange shall be exercisable only
to the extent that the Depositor provides upon the Trustee's request an Opinion
of Counsel that (i) such exchange would not be inconsistent with continued
satisfaction of the applicable requirements for exemption under Rule 3a-7 (or
other applicable rule or exemption) under the Investment Company Act of 1940, as
amended, and all applicable rules, regulations and interpretations thereunder
and (ii) such exchange would not affect the characterization of the Trust as a
"grantor trust" under the Code. The terms of an Optional Exchange may include,
but are not limited to, the following:
(i) a requirement that the exchanging Holder tender to the Trustee
Certificates of each Class within such Series;
(ii) a minimum Certificate Principal Balance or Notional Amount, as
applicable, with respect to Certificates being tendered for exchange by a
single Holder;
(iii) a requirement that the Certificate Principal Balance or
Notional Amount, as applicable, of each Certificate tendered for exchange
be an Authorized Denomination;
(iv) specified dates on which a Holder may effect such an Optional
Exchange (each, an "Optional Exchange Date"), as specified in the
applicable Supplement;
(v) limitations on the right of an exchanging Holder to receive any
benefit upon Optional Exchange from any Credit Support; and
(vi) adjustments to the value of the proceeds of any Optional
Exchange based upon required prepayment of future expense allocations and
the establishment of a reserve for any unanticipated Extraordinary Trust
Expenses.
(b) Unless otherwise provided in the applicable Supplement, no
Certificate may be exchanged pursuant to this Section 4.07 unless the Trustee
has received at least 30 days (or such shorter period acceptable to the Trustee
or specified in the applicable Supplement) but not more than 45 days prior to an
Optional Exchange Date a telegram, telex, facsimile transmission or letter from
a member of a national securities exchange or the National Association of
Securities Dealers, Inc., the Depository (in accordance with its normal
procedures) or a commercial bank or trust company in the United States setting
forth the name of the Holder, the Certificate Principal Balance or Notional
Amount of such Registered Certificate to be exchanged and the number or a
description of the tenor and the terms of such Certificate, a statement that the
Optional Exchange is being exercised thereby and an assurance that the
Registered Certificate to be exchanged with the form entitled "Option to Elect
Exchange" on the reverse of the Registered Certificate duly completed will be
received by such Trustee not later than five Business Days after the date of
such telegram, telex, facsimile transmission or letter, and such Certificate and
form duly completed must be received by such Trustee by such fifth Business Day.
Any tender by the Holder thereof for Optional Exchange shall be irrevocable.
Unless otherwise provided in the applicable Supplement, the Optional Exchange
option may be exercised pursuant to this Section 4.07 by the Holder of a
Certificate for less than the aggregate Certificate Principal Balance or
Notional Amount of such Certificate as long as the Certificate Principal Balance
or Notional Amount remaining Outstanding after such Optional Exchange is an
Authorized Denomination and all other requirements set forth in the related
Supplement are satisfied. Upon such partial
25
exchange, such Certificate shall be cancelled and a new Certificate or
Certificates for the remaining Certificate Principal Balance or Notional Amount
thereof shall be issued (which shall be in the name of the Holder of such
exchanged Certificate).
(c) Upon the completion of any such Optional Exchange, the Trustee
shall give prompt written notice thereof to each Rating Agency.
Section 4.08. Call Right. (a) The holder of a Call Right may
purchase Certificates of a given Series or Class from the Holders thereof prior
to maturity if the applicable Supplement designates such Series or Class as a
Callable Series, or upon the occurrence of a Tax Event or an Optional
Redemption. The Call Terms shall be set forth in the applicable Supplement and
shall include, without limitation, the following:
(i) the initial holder of the Call Right;
(ii) whether the Certificate Principal Balance or Notional Amount of
each Certificate being purchased pursuant to the Call Right must be an
Authorized Denomination;
(iii) the Call Date or Dates; and
(iv) the Call Price.
(b) A Call Right may be exercised at the option of the holder
thereof, in accordance with the Call Terms, upon not less than 35 days'
(or such shorter period acceptable to the Trustee or specified in the
applicable Supplement) nor more than 60 days' prior notice sent via
facsimile with transmission confirmed to the Trustee at the Corporate
Trust Office. Such notice to the Trustee shall include the Certificate
Principal Balance (or Notional Amount) of the Certificates to be
purchased and shall reference the Call Price and the Call Date. On or
prior to the second Business Day following receipt of such notice from
the holder of the Call Right, the Trustee shall notify the Holders of the
Certificates by first class mail; such notices shall state:
(i) the Certificate Principal Balance (or Notional Amount) of
Certificates to be purchased;
(ii) the Call Price;
(iii) the name and address of the Paying Agent;
(iv) that Certificates called for purchase must be surrendered to
the Paying Agent in order to collect the Call Price;
(v) that interest on Certificates called for purchase pursuant to
the Call Right ceases to accrue on and after the Call Date, and the only
remaining right of Holders of such Certificates is to receive payment of
the Call Price upon surrender of the Certificates to the Paying Agent;
and
(vi) that, if any Certificate contains a CUSIP, CINS or ISIN number,
no representation is being made as to the correctness of the CUSIP, CINS
or ISIN number either as printed on the Certificates or as contained in
such notice and that reliance may be placed only on the other
identification numbers printed on the Certificates.
(c) If less than all of the Certificates are to be purchased
pursuant to the exercise of the Call Right, the Trustee shall select the
Certificates to be purchased in accordance with the requirements of the
principal national securities exchange on which the Certificates are
listed or, if the Certificates are not listed on a national securities
exchange, on a pro rata basis, by lot or by such other method as such
Trustee in its sole discretion shall deem to be fair and appropriate. The
Trustee shall notify the Depositor and the Certificate Registrar promptly
in writing of the Certificates or portions of the Certificates to be
purchased by the holder of the Call Right, provided, however, that this
Section 4.08(c) shall not apply to Certificates subject to a Call Right
due to a Tax Event or an Optional Redemption.
26
(d) Once such notice is mailed to the Holders, the Certificates
called for purchase become due and payable on the Call Date and at the
Call Price. Upon surrender of any Certificates to the Paying Agent, the
Holders of such Certificates shall be paid the Call Price. Notice of
purchase shall be deemed to be given when mailed, whether or not the
Holder receives the notice. In any event, failure to give such notice, or
any defect therein, shall not affect the validity of the proceedings for
the purchase of Certificates held by Holders to whom such notice was
properly given.
(e) At or prior to 12:00 noon on the Call Date, the holder of the
Call Right to be exercised shall deposit with the Paying Agent by wire
transfer in same-day funds money sufficient to pay the Call Price of the
Certificates to be redeemed on that date.
(f) If a notice has been given in the manner provided above, the
Certificates or portion of Certificates specified in such notice to be
purchased shall become due and payable on the Call Date at the Call Price
stated therein, together with accrued interest (if applicable) on and
after such dates. Upon surrender of any Certificate in connection with
the Call Right, such Certificate shall be paid and redeemed by the holder
of the Call Right at the Call Price.
(g) Upon surrender of any Certificate that is purchased in part, the
Depositor shall execute and the Trustee shall authenticate and deliver to
the Holder a new Certificate equal in principal amount to the unredeemed
portion of such surrendered Certificate.
(h) Notwithstanding anything to the contrary in these Standard Terms
or any Supplement, a Series or Class will be subject to a Call Right of
the Underlying Securities Issuer if the Underlying Securities Issuer
gives notice of a Tax Event or an Optional Redemption, regardless of
whether such Series or Class is also designated a Callable Series in the
applicable Supplement, and in the case of a Tax Event or an Optional
Redemption the required notice of the Call Right shall be the lesser of
the time set forth in Section 4.08(b) and the time set forth in the
notice provisions relating to such Tax Event or Optional Redemption,
respectively, in the Underlying Securities Indenture, as specified in the
related Supplement.
ARTICLE V
THE CERTIFICATES
Section 5.01. The Certificates. (a) The Certificates of any Series
(or Class within such Series) shall be issued in fully registered form without
coupons and shall be substantially in the form of the exhibit attached to the
applicable Supplement.
(b) Each Series (and all Classes within such Series) shall be
created by a Supplement authorized by the Depositor and establishing the terms
and provisions of such Series. Each Trust must be a fixed investment trust under
the Code. Each such Series may be issued in one or more Classes, with such
further particular designation added or incorporated in such title for the
Certificates of any particular Series or Class within such Series as the
Depositor may determine. Each Certificate shall bear upon its face the
designation so selected for the Series and Class to which it belongs. All
Certificates of the same Series and Class shall be identical in all respects
except for the denominations thereof. All Certificates of all Classes within any
one Series at any time Outstanding shall be identical except for differences
among the Certificates of the different Classes within such Series specified in
the applicable Supplement. Except as otherwise provided in the related
Supplement, all Certificates of a particular Series (and all Classes within such
Series) issued under this Trust Agreement shall be in all respects equally and
ratably entitled to the benefits hereof without preference, priority or
distinction on account of the actual time or times of authentication and
delivery, all in accordance with the terms and provisions of this Trust
Agreement.
27
Section 5.02. Execution, Authentication and Delivery. (a) The
Certificates shall be executed by the Trustee by one of its Responsible
Officers, which may be in facsimile form and imprinted or otherwise reproduced
thereon. The signature of any of the Responsible Officers may be manual or
facsimile. Certificates bearing the manual or facsimile signature of individuals
who were at any time the Responsible Officers of the Trustee shall be binding,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates.
(b) Each Certificate shall be dated as of the later of the date
specified in the related Supplement and the date of its authentication.
(c) No Certificate shall be entitled to any benefit under this Trust
Agreement or be valid or obligatory for any purpose, unless there appears on
such Certificate a certificate of authentication substantially in one of the
forms provided for herein executed by the Trustee by the manual signature of one
of its Responsible Officers, and such signature upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder and is entitled to the benefits of this
Trust Agreement.
Section 5.03. Temporary Certificates. Pending the preparation of
Definitive Certificates or permanent Global Securities of any Series (or Class
within each such Series), and upon receipt of a Depositor Order, the Trustee
shall execute, authenticate and deliver temporary Certificates which are
printed, lithographed, typewritten, mimeographed or otherwise produced, in any
Authorized Denomination, substantially of the tenor of the Definitive
Certificates or permanent Global Securities in lieu of which they are issued, in
registered form and with such appropriate insertions, omissions, substitutions
and other variations as may be authorized by such Depositor Order. Any such
temporary Certificate may be in global form, representing all or a portion of
the Outstanding Certificates of such Series or Class. Every such temporary
Certificate shall be executed, authenticated and delivered by the Trustee upon
the same conditions and in substantially the same manner, and with the same
effect, as the Definitive Certificates or permanent Global Securities in lieu of
which is issued.
If temporary Certificates of any Series (or Class within such
Series) are issued, the Trustee will cause Definitive Certificates or Global
Securities of such Series or Class to be prepared without unreasonable delay.
After the preparation of Definitive Certificates of such Series or Class, the
temporary Certificates of such Series or Class shall be exchangeable for
Definitive Certificates or permanent Global Securities of such Series or Class
upon surrender of the temporary Certificates of such Series or Class at the
Corporate Trust Office, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Certificates of any Series or Class
within such Series, the Trustee, upon receipt of a Depositor Order, shall
execute, authenticate and deliver in exchange therefor Definitive Certificates
or permanent Global Securities with a like Certificate Principal Balance or
Notional Amount, as applicable, of the same Series (or Class within such Series)
of Authorized Denomination and of like tenor. Until so exchanged, temporary
Certificates of any Series (or Class within such Series) shall in all respects
be entitled to the same benefits under this Trust Agreement as Definitive
Certificates or permanent Global Securities of such Series or Class, except as
otherwise specified in the applicable Supplement.
Upon any exchange of a portion of a temporary Global Security for a
permanent definitive Global Security or for the individual Definitive
Certificates represented thereby, the temporary Global Security shall be
endorsed by the Trustee to reflect the reduction of the aggregate Certificate
Principal Balance or Notional Amount, as applicable, evidenced thereby,
whereupon the aggregate Certificate Principal Balance or Notional Amount, as
applicable, of such temporary Global Security shall be reduced for all purposes
by the amount so exchanged and endorsed.
Section 5.04. Registration; Registration of Transfer and Exchange.
(a) The Trustee shall cause to be kept a register for each Series (the registers
maintained in such office and in any other office or agency of the Trustee being
herein sometimes collectively referred to as the "Certificate Register") in
which a transfer agent and registrar (which may be the Trustee) (the
"Certificate Registrar") shall provide for the registration of Certificates and
the registration of transfers and exchanges of Certificates. The Trustee is
hereby initially appointed Certificate Registrar for the purpose of registering
Certificates and transfers and exchanges of Certificates as herein provided;
provided, however, that the Trustee may appoint one or more co-Certificate
Registrars. Upon any resignation of any Certificate Registrar, the Depositor
shall
28
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 and the principal amounts and numbers of the Certificates held by each
Holder.
(b) Upon surrender for registration of transfer any Certificate of
any Series (or Class within such Series) at the office or agency of the Trustee,
if the requirements of Section 8-401(a) of the UCC are met to the Depositor's
satisfaction, the Depositor shall execute, and the Trustee, upon receipt of a
Depositor Order, shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Certificates of any Authorized
Denominations, of a like Series, Class and aggregate Certificate Principal
Balance or Notional Amount, as applicable.
(c) Notwithstanding any other provisions of this Section 5.04,
unless and until it is exchanged in whole or in part for the individual
Certificates represented thereby, a Global Security representing all or a
portion of the Certificates of a Series (or Class within such Series) may not be
transferred except as a whole by the Depository for such Series or Class to a
nominee of such Depository or by a nominee of such Depository to such Depository
or another nominee of such Depository or by such Depository or any such nominee
to a successor Depository for such Series or Class or a nominee of such
successor Depository.
(d) At the option of the Holder, Certificates of any Series (or
Class within such Series) (other than a Global Security, except as set forth
below) may be exchanged for other Certificates of the same Series or Class of
any Authorized Denomination of like tenor and aggregate Certificate Principal
Balance or Notional Amount, as applicable, upon surrender of the Certificates to
be exchanged at the office or agency of the Trustee maintained for such purpose.
(e) All Certificates issued upon any registration of transfer or
exchange of Certificates shall constitute complete and indefeasible evidence of
ownership in the Trust related to such Certificates and be entitled to the same
benefits under this Trust Agreement as the Certificates surrendered upon such
registration of transfer or exchange.
(f) Every Certificate presented or surrendered for registration of
transfer or exchange shall (if so required by the Depositor, the Trustee or the
Certificate Registrar) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Depositor, the Trustee or the
Certificate Registrar, duly executed, by the Holder thereof or his attorney duly
authorized in writing, with such signature guaranteed by a brokerage firm or
financial institution that is a member of a Securities Approved Medallion
Program such as Securities Transfer Agents Medallion Program (STAMP), Stock
Exchange Medallion Program (SEMP) or New York Stock Exchange Inc. Medallion
Signature Program (MSP).
(g) No service charge shall be made to a Holder for any registration
of transfer or exchange of Certificates, but the Trustee may require payment of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any registration of transfer or exchange of
Certificates, other than exchanges pursuant to Section 5.03 not involving any
transfer.
Section 5.05. Mutilated, Destroyed, Lost and Stolen Certificates. If
(i) any mutilated Certificate is surrendered to the Trustee at its Corporate
Trust Office or (ii) the Depositor and the Trustee receive evidence to their
satisfaction of the destruction, loss or theft of any Certificate, and there is
delivered to the Depositor and the Trustee such security or indemnity as they
may require to hold each of them and any Paying Agent harmless, and neither the
Depositor nor the Trustee receives notice that such Certificate has been
acquired by a bona fide purchaser, then the Depositor shall execute and the
Trustee, upon receipt of a Depositor Order, shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of the same Series or Class of like tenor, form,
terms and principal amount, bearing a number not contemporaneously Outstanding.
Any Certificate executed, authenticated and delivered under this Section 5.05 in
lieu of a lost, destroyed or
29
stolen Certificate (a "Predecessor Certificate") shall be deemed to evidence the
same interest as the Predecessor Certificate.
Upon the issuance of any new Certificate under this Section 5.05,
the Trustee may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in respect thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Certificate of any Series or Class issued pursuant to this
Section 5.05 shall constitute complete and indefeasible evidence of ownership in
the Trust related to such Series, whether or not the Predecessor Certificate
shall be at any time enforceable by anyone, and shall be entitled to all the
benefits of this Trust Agreement equally and proportionately with any and all
other Certificates of that Series or Class duly issued hereunder.
The provisions of this Section 5.05 are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of Predecessor Certificates.
Section 5.06. Persons Deemed Owners. (a) The Depositor, the Trustee,
the Securities Intermediary and any agent of the Depositor, the Trustee or the
Securities Intermediary may treat the Person in whose name any Certificate is
registered as the owner of such Certificate for the purpose of receiving
distributions of principal of (and premium, if any) and (subject to Section
4.02) interest, if any, on such Certificate and for all other purposes
whatsoever, whether or not such Certificate be overdue, and neither the
Depositor, the Trustee or the Securities Intermediary, nor any agent of the
Depositor, the Trustee or the Securities Intermediary shall be affected by
notice to the contrary.
(b) None of the Depositor, the Trustee, the Securities Intermediary
or any of their agents will have any responsibility or liability for any aspect
of the records relating to or distributions made by the Depository to Beneficial
Owners of interests in a Global Security or for maintaining, supervising or
reviewing any records relating to such Beneficial Owners.
Section 5.07. Cancellation. Unless otherwise specified pursuant to
Section 5.01 for Certificates of any Series, all Certificates surrendered for
payment, redemption, transfer or exchange shall, if surrendered to any Person
other than the Trustee, be delivered to the Trustee and shall be promptly
cancelled by the Trustee. No Certificates shall be authenticated in lieu of or
in exchange for any Certificates cancelled as provided in this Section 5.07,
except as expressly permitted by this Trust Agreement.
Section 5.08. Global Securities. (a) If the Supplement provides that
a Series (or Class within such Series) of Certificates shall be held by the
Depository in book-entry form, then the Depositor shall execute and, upon
receipt of a Depositor Order, the Trustee shall authenticate and deliver one or
more Global Securities that (i) shall represent an aggregate initial Certificate
Principal Balance or Notional Amount, as applicable, equal to the aggregate
initial Certificate Principal Balance or Notional Amount, as applicable, of the
Certificates of such Series or Class to be represented by such one or more
Global Securities, (ii) shall be registered in the name of the Depository for
such Global Security or Securities or the nominee of such Depository, (iii)
shall be delivered by the Trustee to such Depository or pursuant to such
Depository's instruction and (iv) shall bear a legend substantially to the
following effect:
"UNLESS THIS GLOBAL SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF A NOMINEE OF THE DEPOSITORY (AND
ANY PAYMENT IS MADE TO A NOMINEE OF THE DEPOSITORY), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH
AS THE REGISTERED OWNER HEREOF HAS AN INTEREST HEREIN.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR THE INDIVIDUAL
CERTIFICATES REPRESENTED HEREBY, THIS GLOBAL SECURITY MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A
NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR TO ANOTHER NOMINEE OF THE
DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR
A NOMINEE OF SUCH SUCCESSOR DEPOSITORY."
30
(b) No Holder of a Certificate of such Series or Class will
receive a Definitive Certificate representing such Holder's interest in such
Certificate or Certificates, except as provided in Section 5.10. Unless and
until Definitive Certificates have been issued to Holders of such Series or
Class pursuant to Section 5.10:
(i) the provisions of this Section 5.08 shall be in full force and
effect;
(ii) the Certificate Registrar and the Trustee shall be entitled to
deal with the Depository for all purposes of this Trust Agreement
(including the distribution of principal of, and premium, if any, and
interest on the Certificates and the giving of instructions or directions
hereunder) as the sole Holder of the Certificates of such Series or
Class, and shall have no obligation to the Beneficial Owners of interests
in such Series or Class;
(iii) to the extent that the provisions of this Section 5.08
conflict with any other provisions of this Trust Agreement, the
provisions of this Section 5.08 shall control;
(iv) the rights of Beneficial Owners of such Series or Class shall
be exercised only through the Depository and shall be limited to those
established by law and agreements between such Beneficial Owners and the
Depository or its Participants; and
(v) whenever this Trust Agreement requires or permits actions to be
taken based upon instructions or directions of Holders of a specified
percentage of the aggregate Voting Rights of a Series or Class, the
Depository shall be deemed to represent such percentage only to the
extent that it has received instructions to such effect from Beneficial
Owners of such Series or Class or Participants in such Depository's
system owning or representing, respectively, such required percentage of
the beneficial interest in the Certificates of such Series or Class and
has delivered such instructions to the Trustee.
(c) Each Depository for a Global Security must, at the time of its
designation and at all times while it serves as such Depository, be a
Clearing Agency registered under the Exchange Act and any other applicable
statute or regulation.
Section 5.09. Notices to Depository. Whenever a notice or other
communication to the Holders of a Series or Class within such Series represented
by one or more Global Securities is required under this Trust Agreement, unless
and until Definitive Certificates for such Series or Class shall have been
issued to such Beneficial Owners pursuant to Section 5.10, the Trustee shall
give all such notices and communications specified herein to be given to Holders
of the Certificates of such Series to the Depository, and shall have no
obligation to the Beneficial Owners.
Section 5.10. Definitive Certificates. (a) If in respect of a Series
(or Class within such Series) represented by one or more Global Securities (i)
the Depositor advises the Trustee and the Securities Intermediary in writing
that the Depository is no longer willing or able to properly discharge its
responsibilities with respect to the Certificates of such Series or Class and
the Depositor does not appoint a successor within 90 days or (ii) the Depositor
at its option advises the Trustee and the Securities Intermediary in writing
that it elects to terminate the book-entry system of such Series or Class
through the Depository, then the Depository shall notify all Beneficial Owners
or Participants in the Depository's system with respect to such Series or Class
and the Trustee of the occurrence of any such event and of the availability of
definitive, fully registered Certificates ("Definitive Certificates") for such
Series or Class to Beneficial Owners of such Series or Class requesting the
same.
Upon surrender to the Trustee of the Global Securities of such
Series or Class by the Depository, accompanied by registration instructions, the
Trustee upon receipt of a Depositor Order for the execution, authentication and
delivery of Definitive Certificates of such Series or Class, will execute,
authenticate and deliver Definitive Certificates of such Series or Class in an
aggregate Certificate Principal Balance or Notional Amount, as applicable, equal
to the aggregate Certificate Principal Balance or Notional Amount, as
applicable, of the Global Security or Securities representing Certificates of
such Series or Class in exchange for such Global Security or Securities. None of
the Depositor, the Certificate Registrar, the Trustee or the Securities
Intermediary shall be liable for any delay in delivery of such instructions and
may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the
31
exchange of a Global Security for Definitive Certificates, such Global Security
shall be cancelled by the Trustee. Definitive Certificates issued in exchange
for a Global Security shall be registered in such names and in such Authorized
Denominations as the Depository for such Global Security, pursuant to
instructions from its Participants, any indirect participants or otherwise,
shall instruct the Trustee. The Trustee shall deliver such Certificates to the
Person in whose names such Certificates are so registered. Upon the issuance of
Definitive Certificates of Series or Class, the Trustee shall recognize the
holders of the Definitive Certificates of such Series or Class as Holders.
(b) In addition, if the Depositor so specifies with respect to the
Certificates of a given Series, a Beneficial Owner may, on terms
acceptable to the Depositor and the Depository for such Global Security,
receive individual Definitive Certificates in exchange for such
beneficial interest. Upon the request of such Beneficial Owner, the
Trustee upon receipt of a Depositor Order shall execute, authenticate and
deliver, without service charge,
(i) to each such Person specified, a new individual Certificate or
Certificates of the same Series or Class, of any Authorized Denomination
as requested by such Person in an aggregate Certificate Principal Balance
or Notional Amount, as applicable, equal to and in exchange for such
Person's beneficial interest in the Global Security; and
(ii) to such Depository a new Global Security in an Authorized
Denomination equal to the difference, if any, between the aggregate
Certificate Principal Balance or Notional Amount, as applicable, of the
surrendered Global Security and the aggregate Certificate Principal
Balance or Notional Amount, as applicable, of individual Certificates
delivered to Holders thereof.
In any exchange provided for above, the Trustee, upon receipt of a
Depositor Order, will execute, authenticate and deliver individual Certificates
in registered form in Authorized Denominations.
Section 5.11. Currency of Distributions. (a) Except as otherwise
specified pursuant to the applicable Supplement, distributions of the principal
of (and premium, if any) and interest in respect of Certificates of any Series
or Class will be made in Dollars.
(b) In the case of a Series denominated in a Specified Currency
other than the Dollar, all exchange rate calculations shall be based upon the
noon buying rate in New York City for cable transfers as certified for customs
purposes by the Fed for such Specified Currency. If the Fed does not publish a
noon buying rate for the applicable Specified Currency, the applicable
Supplement will designate the source for calculating the Dollar value of such
Specified Currency.
(c) With respect to any Series, any decision or determination to be
made regarding exchange rates shall be made by an Exchange Rate Agent, provided,
however, that such Exchange Rate Agent shall accept such appointment in writing
and the terms of such appointment shall be acceptable to the Trustee and shall
require such Exchange Rate Agent to make such determination by the method
provided in Section 5.11(b) for the making of such decisions or determination.
All decisions and determinations of such Exchange Rate Agent regarding exchange
rates shall be in its sole discretion and shall, in the absence of manifest
error, be conclusive for all purposes and irrevocably binding upon the
Depositor, the Trustee and all Holders of such Series.
(d) If distributions in respect of a Series must be made in a
Specified Currency other than Dollars and such currency is unavailable due to
the imposition of exchange controls or other circumstances beyond the control of
the Trustee and the Depositor or is no longer used by the government of the
country issuing such Specified Currency or is no longer commonly used for the
settlement of transactions by public institutions of or within the international
banking community, then all distributions in respect of such Series shall be
made in Dollars until such Specified Currency is available.
Section 5.12. Conditions of Execution, Authentication and Delivery
of New Series. (a) Certificates of a new Series may be issued at any time and
from time to time after the execution and delivery of these Standard Terms and
the related Supplement. The Trustee shall execute, authenticate and deliver such
Certificates upon a Depositor Order and upon delivery by the Depositor to the
Trustee of the following:
32
(i) The delivery of the Underlying Securities in accordance with
Section 2.01(b);
(ii) An Opinion of Counsel to the Depositor, addressed to the
Trustee, stating:
1. The Certificates are in the form contemplated by the Trust
Agreement and assuming that the Certificates have been duly executed,
authenticated and delivered by the Trustee in the manner described in
its certificate delivered today, the Certificates are entitled to the
benefits provided in the Trust Agreement and constitute valid and
binding obligations of the Trust, enforceable against the Trust in
accordance with their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors' rights generally and
except as enforcement thereof is subject to general principles of
equity (regardless of whether enforcement is considered in a proceeding
in equity or at law), and will be entitled to the benefits of the Trust
Agreement.
2. Execution, authentication and delivery of such Certificates
by the Trustee will not violate the terms of the Trust Agreement.
3. The execution and delivery of the Trust Agreement will not
contravene the certificate of incorporation or by-laws of the Company
or result in any violation of any of the terms or provisions of any law
or regulation or, to our knowledge of any indenture, mortgage or other
agreement by which the Company is bound.
4. The Trust Agreement has been duly authorized, executed and
delivered by the Company and (assuming the due authorization, execution
and delivery thereof by the Trustee and the Securities Intermediary)
constitutes a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or other similar laws affecting
enforcement of creditors' rights generally and except as enforcement
thereof is subject to general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at law).
(iii) An Officer's Certificate of the Depositor, dated as of the
Closing Date, to the effect that all of the requirements of this Section
5.12 have been satisfied, and that the Depositor is not in breach of this
Trust Agreement and that the execution and delivery of this Trust
Agreement and the Certificates will not result in any breach of any of
the terms, conditions, or provisions of, or constitute a default under,
the Depositor's certificate of incorporation and by-laws, or any
indenture, mortgage, deed of transfer or other agreement or instrument to
which the Depositor is a party or by which it or its property is bound or
any order of any court or administrative agency entered in any Proceeding
to which the Depositor is a party or by which it or its property may be
bound or to which it or its property may be subject;
(iv) A Supplement consistent with the applicable provisions of these
Standard Terms; (v) All agreements, instruments or other documents called
for by the applicable Supplement as a condition to the issuance of the
Certificates of such Series; (vi) If applicable, a fully executed copy of
any Swap Agreement or other Credit Support Instrument, together with all
documents and opinions required to be delivered to the Trust upon
execution thereof pursuant to the terms thereof; and (vii) Written
instructions by the Depositor to the Trustee directing the Trustee to
enter into and perform any obligations under any Swap Agreement or other
Credit Support Instrument, if applicable, and/or the Market Agent
Agreement, if applicable.
(b) If all the Certificates of a Series are not to be originally
issued at the same time, then the documents required to be delivered
pursuant to this Section 5.12 must be delivered only once, prior to the
authentication and delivery of the first Certificate of such Series;
provided, however, that any subsequent Depositor Order to the Trustee to
authenticate Certificates of such Series upon original issuance shall
constitute a representation and warranty by the Depositor that, as of the
date of such request, the statements made in this Section 5.12 shall be
true and correct as if made on such date.
33
Section 5.13. Appointment of Paying Agent. The Trustee may appoint
one or more paying agents (each, a "Paying Agent") with respect to the
Certificates of any Series. Any such Paying Agent shall be authorized to make
distributions to Certificateholders of such Series from the Certificate Account
for such Series pursuant to the provisions of the Supplement and shall report
the amounts of such distributions to the Trustee. Any Paying Agent shall have
the revocable power to withdraw funds from such Certificate Account for the
purpose of making the distributions referred to above. The Trustee may revoke
such power and remove the Paying Agent if the Trustee determines in its sole
discretion that the Paying Agent shall have failed to perform its obligations
under this Trust Agreement in any material respect; provided, however, no Paying
Agent may be removed or replaced until a successor (which successor may be the
Trustee) has been appointed as provided for herein and has accepted the
appointment. The Paying Agent shall initially be the Trustee and any co-paying
agent chosen by the Trustee and acceptable to the Depositor, including, if and
so long as any Series or Class within such Series is listed on the Luxembourg
Stock Exchange and such exchange so requires, a co-paying agent in Luxembourg or
another European city, as specified in the related Supplement. Any Paying Agent
shall be permitted to resign as Paying Agent upon 30 days' notice to the
Trustee. In the event that the Trustee shall no longer be the Paying Agent, the
Trustee shall appoint a successor or additional Paying Agent. The Trustee shall
cause each successor to act as Paying Agent to execute and deliver to Trustee an
instrument in which such successor or additional Paying Agent shall agree with
the Trustee that it will hold all sums, if any, held by it for distribution to
the Certificateholders in trust for the benefit of the Certificateholders
entitled thereto until such sums shall be distributed to such Certificateholders
and will agree to such other matters as are required by TIA Section 317(b). The
Paying Agent shall return all unclaimed funds to the Trustee and upon removal
shall also return all funds in its possession to the Trustee. The provisions of
Sections 7.01, 7.03, 7.04 and 7.06 shall apply to the Trustee also in its role
as Paying Agent, for so long as the Trustee shall act as Paying Agent. Any
reference in this Trust Agreement to the Paying Agent shall include any
co-paying agent unless the context requires otherwise. Notwithstanding anything
contained herein to the contrary, the appointment of a Paying Agent pursuant to
this Section 5.13 shall not release the Trustee from the duties, obligations,
responsibilities or liabilities arising under this Trust Agreement other than
with respect to funds paid to such Paying Agent.
Section 5.14. Authenticating Agent. (a) The Trustee may appoint one
or more Authenticating Agents (each, an "Authenticating Agent") with respect to
the Certificates of any Series which shall be authorized to act on behalf of the
Trustee in authenticating such Certificates in connection with the issuance,
delivery and registration of transfer or exchange of such Certificates. Whenever
reference is made in this Trust Agreement to the authentication of Certificates
by the Trustee or the Trustee's certificate of authentication, such reference
shall be deemed to include authentication on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent must be
acceptable to the Depositor. Notwithstanding anything contained herein to the
contrary, the appointment of an Authenticating Agent pursuant to this Section
5.14 shall not release the Trustee from the duties, obligations,
responsibilities or liabilities arising under this Trust Agreement.
(b) Any institution succeeding to the corporate agency business of
any Authenticating Agent shall continue to be an Authenticating Agent without
the execution or filing of any power or any further act on the part of the
Trustee or such Authenticating Agent. An Authenticating Agent may at any time
resign by giving notice of resignation to the Trustee and to the Depositor. The
Trustee may at any time terminate the agency of an Authenticating Agent by
giving notice of termination to such Authenticating Agent and to the Depositor.
Upon receiving such a notice of resignation or upon such a termination, or in
case at any time an Authenticating Agent shall cease to be acceptable to the
Trustee or the Depositor, the Trustee promptly may appoint a successor
Authenticating Agent which may be the Trustee. Any successor Authenticating
Agent upon acceptance of its appointment hereunder shall become vested with all
the rights, powers and duties of its predecessor hereunder, with like effect as
if originally named as an Authenticating Agent. No successor Authenticating
Agent shall be appointed unless acceptable to the Depositor. The Trustee agrees
to pay to each Authenticating Agent from time to time reasonable compensation
for its services under this Section. The provisions of Sections 7.01, 7.03 and
7.04 shall be applicable to any Authenticating Agent.
(c) Pursuant to an appointment made under this Section, the
Certificates may have endorsed thereon, in lieu of the Trustee's certificate of
authentication, an alternate certificate of authentication in substantially the
following form:
34
"This is one of the Certificates described in the Standard Terms and
the related Supplement.
Dated: [NAME OF AUTHENTICATING AGENT]
as Authenticating Agent
for the Trustee,
By:
-----------------------
Authorized Officer"
Section 5.15. Voting Rights with Respect to Underlying Securities.
(a) Within five Business Days after receipt of notice of any meeting of, or
other occasion for the exercise of voting rights or the giving of consents by
owners of any of the Underlying Securities, the Trustee shall give notice to the
Holders, setting forth (i) such information as is contained in such notice to
owners of Underlying Securities, (ii) a statement that Holders will be entitled,
subject to any applicable provision of law and any applicable provisions of such
Underlying Securities to instruct the Trustee as to the exercise of Voting
Rights, if any, pertaining to such Underlying Securities and (iii) a statement
as to the manner in which instructions may be given to the Trustee to give a
discretionary proxy to a person designated in the notice received by the
Trustee. Such notice shall be given by the Trustee to the Holders of record on
such Record Date.
Upon the written request of the applicable Holder, received on or
before the date established by the Trustee for such purpose, the Trustee shall
endeavor, insofar as practicable and permitted under any applicable provision of
law and any applicable provision of or governing the Underlying Securities, to
vote in accordance with any nondiscretionary instruction set forth in such
written request. The Trustee shall not vote except as specifically authorized
and directed in written instructions from the applicable Holder entitled to give
such instructions. Notwithstanding the foregoing, if the Trustee determines
(based solely upon advice furnished by nationally recognized independent tax
counsel, whether at the request of any Holder or otherwise) that the exercise of
voting rights with respect to any Underlying Securities could result in a "sale
or other disposition" of such Underlying Securities within the meaning of
Section 1001(a) of the Code, as amended, the Trustee shall exercise such voting
rights in a manner that would not result in any such sale or other disposition.
The Trustee will have no responsibility to undertake on its own initiative to
determine that any exercise of voting rights will result in any such sale or
other disposition.
(b) By accepting delivery of a Certificate, whether upon original
issuance or subsequent transfer, exchange or replacement thereof, and without
regard to whether ownership is beneficial or otherwise, the Holder agrees so
long as it is an owner thereof that it shall not grant any consent (i) to any
conversion of the timing of payment of, or the method or rate of accruing,
interest on the Underlying Securities underlying the Certificates held by such
Holder or (ii) to any redemption or prepayment of the Underlying Securities
underlying the Certificates held by such Holder. The Trustee shall not grant any
consent solicited from the owners of the Underlying Securities underlying the
Certificates with respect to the matters set forth in this Section nor shall it
accept or take any action in respect of any consent, proxy or instructions
received from any Holder in contravention of the provisions of this Section.
Section 5.16. Actions by Certificateholders. (a) Wherever in this
Trust Agreement a provision is made that an action may be taken or a notice,
demand or instruction given by Certificateholders or Beneficial Owners, such
action, notice or instruction may be taken or given by any Certificateholder or
Beneficial Owner.
(b) Each Certificateholder or Beneficial Owner shall have the right
to assert any rights and privileges of a Certificateholder or Beneficial Owner,
and shall have the right to proceed directly and individually against any Person
to enforce any remedies hereunder and shall not be required to act in concert
with any other Certificateholder or Beneficial Owner or any other Person.
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other act by a Certificateholder or Beneficial Owner of a Certificate
shall bind such Certificateholder or Beneficial Owner and every subsequent
Certificateholder or Beneficial Owner of such Certificate or any Certificate
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof in respect of anything done, suffered or omitted to be done by the
Certificateholder or Beneficial Owner or the
35
Trustee in reliance thereon, whether or not notation of such action is made upon
such Certificate.
(d) Holders are beneficial owners of the right to receive principal
payments and interest payments to which such Certificates relate and, as such,
will have the right following an event of default with respect to any Underlying
Security to proceed directly against the Underlying Securities Issuer(s). Such
Certificateholders are not required to join other Holders of Certificates, the
Depositor, the Trustee or the Securities Intermediary in order to proceed
against the Underlying Securities Issuer(s).
Section 5.17. Events of Default. If any Event of Default shall occur
and be continuing with respect to any Class of Certificates, then, and in each
and every case, the Trustee shall exercise any rights in respect of the related
Underlying Securities as provided in the applicable Supplement.
Section 5.18. Judicial Proceedings Instituted by Trustee; Trustee
May Bring Suit. If there shall be a failure to make payment of the principal of
or premium, if any, or interest on any Underlying Security, then the Trustee, in
its own name, and as trustee of an express trust, as holder of such Underlying
Security, shall be, to the extent permitted by and in accordance with the terms
of the Underlying Security, subject to the limitations on acceleration and the
exercise of remedies set forth therein, and further subject to the provisions of
Sections 7.01(c) and 7.06(f) herein, entitled and empowered to institute
Proceedings at law, in equity or otherwise, including the power to make a demand
on the trustee in respect of such Underlying Security, if provided for, to take
action to enforce the Underlying Security for the collection of the sums so due
and unpaid on such Underlying Security and may prosecute any such Proceeding to
judgment or final decree with respect to the whole amount of any such sums so
due and unpaid.
Section 5.19. Control by Certificateholders. The Holders of
Certificates of any Class holding Certificates representing not less than the
Required Percentage--Direction of Trustee of the aggregate Voting Rights of the
Outstanding Certificates of such Class shall have the right to direct the time,
method and place of conducting any Proceeding for any remedy available to the
Trustee or exercising any trust or power conferred on the Trustee under this
Trust Agreement, including any right of the Trustee as holder of the Underlying
Securities; provided that:
(i) such direction shall not be in conflict with any rule of law or
with this Trust Agreement and would not involve the Trustee in personal
liability or expense;
(ii) the Trustee shall determine, based upon an Opinion of Counsel,
that the action so directed would not be unjustly prejudicial to the
Holders of Certificates of such Class not taking part in such direction;
and
(iii) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
Section 5.20. Waiver of Past Defaults. The Holders of the Required
Percentage--Waiver of Certificates of any Series may (a) waive any past default
under this Trust Agreement and its consequences or (b) direct the Trustee to
vote such percentage of the Underlying Securities held by the Trustee as
corresponds to the percentage of the aggregate Principal Amount of the
Certificates of such Series held by such Holders to waive any past default
thereunder and its consequences with respect to such Series; provided that such
Holders may not waive or direct the Trustee to waive a default
(i) in the payment of the principal of or premium, if any, or
interest on the Underlying Securities; or
(ii) in respect of a covenant or provision hereof that under Section
11.01 hereof cannot be modified or amended without the consent of the
Holder of each Outstanding Certificate affected.
Upon any waiver of a default under this Trust Agreement or direction that is
effective to waive a default in respect of the Underlying Securities, such
default shall cease to exist with respect to this Trust Agreement, any Event of
Default arising therefrom shall be deemed to have been cured for every purpose
of this Trust Agreement and any direction given by the Trustee on behalf of such
Holders in respect of any Underlying Securities
36
shall be annulled with respect thereto; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.
Section 5.21. Right of Certificateholders to Receive Payments Not to
Be Impaired. Anything in this Trust Agreement to the contrary notwithstanding,
the right of any Certificateholder to receive distributions of payments required
pursuant to Section 4.01 hereof on the Certificates when due, or to institute
suit for enforcement of any such payment on or after the applicable Distribution
Date or other date specified herein for the making of such payment, shall not be
impaired or affected without the consent of such Certificateholder.
Section 5.22. Remedies Cumulative. Every remedy given hereunder to
the Trustee or to any of the Certificateholders shall not be exclusive of any
other remedy or remedies, and every such remedy shall be cumulative and in
addition to every other remedy given hereunder or now or hereafter given by
statute, law, equity or otherwise.
ARTICLE VI
THE DEPOSITOR
Section 6.01. Liability of the Depositor. The Depositor shall be
liable in accordance herewith only to the extent of the obligations specifically
imposed by these Standard Terms and the related Supplement.
Section 6.02. Limitation on Liability of the Depositor. (a) The
Depositor shall not be under any obligation to expend or risk its own funds or
otherwise incur financial liability in the performance of its duties hereunder
or under a Supplement or in the exercise of any of its rights or powers if
reasonable grounds exist for believing that the repayment or such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it.
(b) Neither the Depositor nor any of its directors, officers,
employees or agents shall be under any liability to any Trust or the
Certificateholders of any Series for any action taken, or for refraining from
the taking of any action, in good faith pursuant to this Trust Agreement, or for
errors in judgment; provided, however, that this provision shall not protect the
Depositor against any breach of representations, warranties or covenants made
herein, or against any liability which would otherwise be imposed by reason of
willful misfeasance, bad faith or negligence in the performance of duties or by
reason of reckless disregard of obligations and duties hereunder.
(c) The Depositor shall not be under any obligation to appear in,
prosecute or defend any legal action unless such action is related to its
respective duties under this Trust Agreement and, in its opinion, does not
involve it in any expense or liability; provided, however, that the Depositor
may in its discretion undertake any such action which it may deem necessary or
desirable with respect to this Trust Agreement and the rights and duties of the
parties hereto and the interests of the Certificateholders hereunder. The
Depositor shall be under no obligation whatsoever to appear in, prosecute or
defend any action, suit or other Proceeding in respect of any Underlying
Securities.
(d) The Depositor shall not be liable to any Certificateholder for
any action or non-action by it in reliance upon the advice of or information
from legal counsel, accountants, and a Certificateholder of a Certificate or any
other person believed by it in good faith to be competent to give such advice or
information, including, without limitation, the Market Agent or the other
parties to this Trust Agreement. The Depositor may rely and shall be protected
in acting upon any written notice, request, direction or other document believed
by it to be genuine and to have been signed or presented by the proper party or
parties.
(e) The Depositor shall not incur any liability to any
Certificateholder if, by reason of any provision of any present or future law,
or regulation thereunder, or any governmental authority, or by any reason of any
act of God or war or other circumstance beyond the control of the relevant
party, the Depositor shall be prevented or forbidden from doing or performing
any act or thing which the terms of this Trust Agreement provide shall be done
or performed; and the Depositor shall not incur any liability to any
Certificateholder by reason of any non-performance or delay, caused as
aforesaid, in the performance of any act or thing which the terms of this Trust
Agreement provide shall or may be done or performed, or by reason of any
exercise of, or failure to exercise, any discretion provided for in this Trust
Agreement.
Section 6.03. Depositor May Purchase Certificates. The Depositor may
at any time purchase Certificates in the open market or otherwise. Certificates
so purchased by
37
the Depositor may, at the discretion of the Depositor, be held or resold.
Certificates beneficially owned by the Depositor will be disregarded for
purposes of determining whether the required percentage of the aggregate
Voting Rights has given any request, demand, authorization, direction, notice,
consent or waiver hereunder.
Section 6.04. Merger or Consolidation of the Depositor.Nothing in
this Trust Agreement shall prevent any consolidation or merger of the Depositor
with or into any other corporation, or any consolidation or merger of any other
corporation with or into the Depositor or any sale or transfer of all or
substantially all of the property and assets of the Depositor to any other
Person lawfully entitled to acquire the same; provided, however, that, so long
as Certificates are outstanding hereunder, the Depositor covenants and agrees
that any such consolidation, merger, sale or transfer shall be upon the
condition that the due and punctual performance and observance of all the terms,
covenants and conditions of this Trust Agreement to be kept or performed by the
Depositor shall be assumed by the Person (if other than the Depositor) formed by
or resulting from any such consolidation or merger, or which shall have received
the transfer of all or substantially all of the property and assets of the
Depositor, just as fully and effectually as if successor Person had been the
original party of the first part hereto; and in the event of any such sale or
transfer the predecessor Depositor may be dissolved, wound up and liquidated at
any time thereafter.
Section 6.05. No Liability of the Depositor with Respect to the
Underlying Securities; Certificateholders to Proceed Directly Against the
Underlying Securities Issuer(s). (a) The sole obligor with respect to any
Underlying Security is the Underlying Securities Issuer(s). The Depositor shall
not have any obligation on or with respect to the Underlying Securities; and its
obligations with respect to Certificates shall be solely as set forth in this
Trust Agreement.
(b) The Depositor is not authorized to proceed against the
Underlying Securities Issuer in the event of a default or to assert the rights
and privileges of Certificateholders and has no duty in respect thereof.
ARTICLE VII
THE TRUSTEE
Section 7.01. Duties of Trustee. (a) The Trustee undertakes to
perform such duties and only such duties as are specifically set forth in these
Standard Terms and the related Supplement. The Trustee shall exercise in case of
receipt of notice of Default (as such term is defined in paragraph (d) below)
such of the rights and powers vested in it by this Trust Agreement, and shall
use the same degree of care and skill in their exercise, as a prudent person
would exercise or use under the circumstances in the conduct of such person's
own affairs. In the event that the Underlying Securities Issuer ceases to file
periodic reports under the Exchange Act, the Depositor shall notify the Trustee
of that fact and the Trustee shall take such actions as specifically set forth
in the Supplement. The Trustee shall exercise those rights in a manner
consistent with the status of any Trust created hereunder as a fixed investment
trust for federal income tax purposes as directed by the Depositor. The Trustee
shall not have any power to vary the investment of any Certificateholders of any
Series or to accept any assets (other than proceeds of the Underlying
Securities) other than the Underlying Securities transferred to it on the
Closing Date of any Series. Any permissive right of the Trustee enumerated in
this Trust Agreement shall not be construed as a duty and shall be interpreted
consistently with the status of the Trust as a fixed investment trust.
(b) The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments
furnished to the Trustee which are specifically required to be furnished
pursuant to any provision of this Trust Agreement, shall examine them to
determine, in its best judgment, whether they conform to the requirements
of this Trust Agreement. If any such instrument is found not to conform
to the requirements of this Trust Agreement, the Trustee shall take
action as it deems appropriate to have the instrument corrected, and if
the instrument is not corrected to the Trustee's satisfaction, the
Trustee will provide notice thereof to the Depositor and
Certificateholders.
(c) No provision of this Trust Agreement shall be construed to
relieve the Trustee from liability for its own negligent action, its own
negligent failure to act or its own misconduct; provided, however, that:
(i) the duties and obligations of the Trustee shall be determined
solely by the express provisions of this Trust Agreement, the Trustee
shall not be liable except
38
for the performance of such duties and obligations as are specifically
set forth in this Trust Agreement, no implied covenants or obligations
shall be read into this Trust Agreement against the Trustee and, in the
absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon any certificates or opinions
furnished to the Trustee that conform to the requirements of this Trust
Agreement;
(ii) the Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer or Responsible
Officers of the Trustee, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts;
(iii) the Trustee shall not be personally liable with respect to any
action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of Holders of the Required
Percentage--Direction of Trustee of the aggregate Voting Rights of a
given Series (or Class or group of Classes within such Series), as
specified in the applicable Supplement relating to the time, method and
place of conducting any Proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee,
under this Trust Agreement;
(iv) the Trustee shall not be required to expend or risk its own
funds or otherwise incur financial liability in the performance of any of
its duties hereunder or in the exercise of any of its rights or powers if
there is reasonable ground for believing that the repayment of such funds
or adequate indemnity against such risk or liability is not reasonably
assured to it;
(v) except for actions expressly authorized by this Trust Agreement,
the Trustee shall take no actions reasonably likely to impair the
interests of the Trust in any Underlying Security now existing or
hereafter acquired or to impair the value of any Underlying Security now
existing or hereafter acquired;
(vi) except as expressly provided in this Trust Agreement, the
Trustee shall have no power to vary the corpus of the Trust including by
(A) accepting any substitute obligation or asset for an Underlying
Security initially assigned to the Trustee under Section 2.01, (B) adding
any other investment, obligation or security to the Trust or (C)
withdrawing from the Trust any Underlying Securities;
(vii) in the event that the Paying Agent or the Certificate
Registrar shall fail to perform any obligation, duty or agreement in the
manner or on the day required to be performed by the Paying Agent or
Certificate Registrar, as the case may be, under this Trust Agreement,
the Trustee shall be obligated promptly upon its knowledge thereof to
perform such obligation, duty or agreement in the manner so required;
(viii) the Trustee shall not be liable to any Certificateholder for
any action or non-action by it in reliance upon the advice of or
information from legal counsel, accountants, any Certificateholder or any
other person believed by it in good faith to be competent to give such
advice or information, including, without limitation, the Market Agent or
the other parties to this Trust Agreement. The Trustee may rely and shall
be protected in acting upon any written notice, facsimile transmission,
request, direction or other document believed by it to be genuine and to
have been signed or presented by the proper party or parties;
(ix) the Trustee shall not incur any liability to any
Certificateholder if, by reason of any provision of any present or future
law, or regulation thereunder, or any governmental authority, or by any
reason of any act of God or war or other circumstance beyond the control
of the relevant party, the Trustee shall be prevented or forbidden from
doing or performing any act or thing which the terms of this Trust
Agreement provide shall be done or performed; and the Trustee shall not
incur any liability to any Certificateholder by reason of any
non-performance or delay, caused as aforesaid, in the performance of any
act or thing which the terms of this Trust Agreement provide shall or may
be done or performed, or by reason of any exercise of, or failure to
exercise, any discretion provided for in this Trust Agreement;
(x) the Trustee shall be under no obligation whatsoever to appear
in, prosecute or defend any Proceeding in respect of any Underlying
Securities;
39
(xi) whenever in the administration of this Trust Agreement the
Trustee shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the Trustee
(unless other evidence be herein specifically prescribed) may, in the
absence of bad faith on its part, conclusively rely upon an Officers'
Certificate; and (xii) the Trustee may consult with counsel of its
selection and, the advice of such counsel or any Opinion of Counsel
selected by the Trustee with due care shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in reliance thereon.
(d) As promptly as practicable after, and in any event within 10
days after, the occurrence of any Default (as such term is defined below)
hereunder with respect to any Class of Certificates, the Trustee shall
transmit by mail to the Depositor and the Holders of Certificates of such
Class in accordance with TIA Section 313(c), notice of such Default
hereunder actually known to the Trustee, unless such Default shall have
been cured or waived; provided, however, that, except in the case of a
Default in the payment of the principal of or premium, if any, or
interest on any Underlying Security, the Trustee shall be protected in
withholding such notice if and so long as a trust committee of
Responsible Officers of the Trustee in good faith determines that the
withholding of such notice is in the interests of the Holders of the
Certificates of such Class. For the purpose of this Section 7.01(d), the
term "Default" means, with respect to any Class of Certificates, any
event that is, or after notice or lapse of time or both would become, an
Event of Default with respect to such Class of Certificates.
(e) Within five (5) Business Days after the receipt by the Trustee
of a written application by any three or more Certificateholders stating
that such Certificateholders desire to communicate with other
Certificateholders with respect to their rights under this Trust
Agreement or under the Certificates, and accompanied by a copy of the
form of proxy or other communication which such Certificateholders
propose to transmit, and by reasonable proof that each such
Certificateholder has owned its Certificates for a period of at least six
(6) months preceding the date of such application, the Trustee shall, at
its election, either:
(i) afford to such Certificateholders access to all information so
furnished to or received by the Trustee; or
(ii) inform such Certificateholders as to the approximate number of
Certificateholders according to the most recent information so furnished
to or received by the Trustee, and as to the approximate cost of mailing
to such Certificateholders the form of proxy or other communication, if
any, specified in such application.
If the Trustee shall elect not to afford to such Certificateholders access to
such information, the Trustee shall, upon the written request of such
Certificateholders, mail to all such Certificateholders copies of the form of
proxy or other communication which is specified in such request, with reasonable
promptness after a tender to the Trustee of the material to be mailed and of
payment, or provision for the payment, of the reasonable expenses of such
mailing.
(f) The Trustee shall prepare for filing, at the direction of and
with information provided by the Depositor, periodic reports for the Trust
pursuant to the Exchange Act, and the rules and regulations promulgated
thereunder on behalf of the Depositor. The Depositor shall respond reasonably
promptly to any inquiry of the Trustee concerning such reports and shall provide
the information required for such reports within three days of the filing due
date.
40
Section 7.02. Agreements Between Trustee and Administrative Agents.
(a) The Trustee may enter into Administration Agreements with one or more
Administrative Agents in order to delegate to such Administrative Agents certain
of its administrative obligations with respect to a Series hereunder; provided,
however, that:
(i) such delegation shall not release the Trustee from the duties,
obligations, responsibilities or liabilities arising hereunder;
(ii) the Rating Agency Condition shall have been satisfied with
respect to the entering into of any such agreement;
(iii) such agreement must be consistent with these Standard Terms
and, with respect to Certificates of any Series, the related Supplement;
(iv) the Trustee will remain solely liable for all fees and expenses
it may owe to such Administrative Agent;
(v) the Administrative Agent shall give representations and
warranties in such Administration Agreement that are the same in
substance as those set forth in Section 7.10 herein (references therein
to the Trust Agreement, the Trustee and the Depositor shall be to the
applicable Administration Agreement, Administrative Agent and Trustee,
respectively, for purposes of this Section 7.02(a)); and
(vi) such Administrative Agent shall meet the eligibility
requirements of a Trustee pursuant to Section 7.07 herein.
An Administration Agreement must provide that an entity serving as
Administrative Agent may resign from its obligations and duties under this Trust
Agreement with respect to any Series only if such resignation, and the
appointment of a successor, would satisfy the Rating Agency Condition or upon a
determination that the duties of the Administrative Agent with respect to such
Series are no longer permissible under applicable law. No such resignation shall
become effective until the Trustee or a successor Administrative Agent has
assumed the obligations of such Administrative Agent with respect to such
Series. In addition, with respect to any Series (or Class within such Series),
each Administration Agreement shall impose on the Administrative Agent
requirements conforming to the provisions set forth in Section 3.01 and provide
for administration of the related Trust and all or certain specified Underlying
Securities for such Series consistent with the terms of this Trust Agreement.
Additional requirements relating to the scope and contents of any Administration
Agreement may be provided in the applicable Supplement. The Trustee shall
deliver to the Depositor copies of all Administration Agreements into which it
enters, and any amendments or modifications thereof, promptly upon the Trustee's
execution and delivery of any such instruments.
(b) Upon the occurrence of an Administrative Agent Termination
Event, the Trustee shall be entitled to terminate the relevant Administration
Agreement and the rights and obligations of any such Administrative Agent under
any Administration Agreement in accordance with the terms and conditions of any
such Administration Agreement. If such Administration Agreement is terminated,
the Trustee shall simultaneously reassume direct responsibility for all
obligations delegated in such Administration Agreement without any act or deed
on the part of the applicable Administrative Agent, and the Trustee shall
administer directly the related Underlying Securities or shall enter into an
Administration Agreement with a successor Administrative Agent which so
qualifies under Section 7.02(a). If the Trustee is unwilling or unable to act,
it may appoint, or petition a court of competent jurisdiction for the
appointment of, an Administrative Agent which so qualifies under Section
7.02(a). Pending such appointment, the Trustee must act in such capacity (except
that if the Trustee is prohibited by law from doing so, then the Trustee will
not be so obligated).
(c) If an Administrative Agent is administering one or more
Underlying Securities pursuant to an Administration Agreement, the
Administrative Agent shall deposit into an Eligible Account established by such
Administrative Agent (an "Administration Account") any amounts collected with
respect thereto, and all such amounts shall be distributed to the Trustee for
deposit into the related Certificate Account not later than the Business Day
after receipt thereof.
41
Section 7.03. Certain Matters Affecting the Trustee. (a) Except as
otherwise provided in this Article VII:
(i) the Trustee may request and rely upon and shall be protected in
acting or refraining from acting upon any resolution, Officer's
Certificate, certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, facsimile transmission, request,
consent, order, appraisal, bond or other paper or document reasonably
believed by it to be genuine and to have been signed or presented by the
proper party or parties;
(ii) the Trustee may consult with counsel and any Opinion of Counsel
shall be full and complete authorization and protection in respect of any
action taken or suffered or omitted by it hereunder in good faith and in
accordance with such Opinion of Counsel;
(iii) the Trustee shall be under no obligation to exercise any of
the trusts or powers vested in it by this Trust Agreement or to
institute, conduct or defend any litigation hereunder or in relation
hereto, at the request, order or direction of any of the
Certificateholders, pursuant to the provisions of this Trust Agreement,
unless such Certificateholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby;
(iv) the Trustee shall not be personally liable for any action
taken, suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon it
by this Trust Agreement;
(v) the Trustee shall not be bound to make any investigation into
the facts of matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, facsimile transmission, request,
consent, order, appraisal, approval, bond or other paper or document
believed by it to be genuine, unless requested in writing to do so by
Holders of the Required Percentage--Direction of Trustee of the aggregate
Voting Rights of the affected Series (or Class or Classes within any such
Series), as specified by the applicable Supplement; provided, however,
that if the payment within a reasonable time to the Trustee of the costs,
expenses or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured
to the Trustee by the security afforded to it by the terms of this Trust
Agreement, the Trustee may require reasonable indemnity against such
expense or liability as a condition to taking any such action;
(vi) the Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents
or attorneys or a custodian and shall not be liable for any misconduct or
negligence of any such agents or attorneys selected with due care by it;
and
(vii) the Trustee shall not be personally liable for any loss
resulting from the investment of funds held in any Certificate Account or
Reserve Account in accordance with Section 3.05.
(b) All rights of action under this Trust Agreement or under any of
the Certificates, enforceable by the Trustee, may be enforced by it
without the possession of any of the Certificates of any Series (or Class
within such Series), or the production thereof at the trial or other
Proceeding relating thereto, and any such Proceeding instituted by the
Trustee shall be brought in its name for the benefit of all the Holders
of such Certificates, subject to the provisions of this Trust Agreement.
42
Section 7.04. Trustee Not Liable for Recitals in Certificates or
Underlying Securities. The Trustee assumes no responsibility for the correctness
of the recitals contained herein and in the Certificates or in any document
issued in connection with the sale of the Certificates (other than the signature
and authentication on the Certificates). Except as set forth in Section 7.10,
the Trustee makes no representations or warranties as to the validity or
sufficiency of this Trust Agreement or of the Certificates of any Series (other
than the signature and authentication on the Certificates) or of any Underlying
Security or related document. The Trustee shall not be accountable for the use
or application by the Depositor, of any of the Certificates or of the proceeds
of such Certificates.
Section 7.05. Trustee May Own Certificates. The Trustee in its
individual capacity or any other capacity may become the owner or pledgee of
Certificates with the same rights it would have if it were not Trustee;
provided, however, that in determining whether the required percentage of
aggregate Voting Rights shall have consented to any action hereunder requiring
the consent of the Certificateholders, any interest beneficially held by the
Trustee in its individual capacity shall be excluded.
Section 7.06. Trustee's Fees and Expenses. (a) The applicable
Supplement shall specify the amount and circumstances of the Trustee's
compensation and the source thereof.
(b) If the Prepaid Ordinary Expenses set forth in the Supplement is
greater than zero, the Trustee acknowledges that the Depositor has paid to the
Trustee an amount equal to the Prepaid Ordinary Expenses specified therein, and
the Trustee agrees that the payment of such amount shall constitute full and
final satisfaction of and payment for all such expenses.
(c) If the Prepaid Ordinary Expenses set forth in the Supplement is
zero, the Supplement may indicate that Ordinary Expenses will be paid for by the
Trust, in which case the Trustee shall be paid on a periodic basis by the Trust
at the rate or amount and on the terms provided for in the Supplement. In such
cases, the Trustee agrees that its right to receive such payments from the Trust
shall constitute full and final satisfaction of and payment for all Ordinary
Expenses and that the Trustee shall have no claim on payment of Ordinary
Expenses from any other source, including the Depositor.
(d) If the Prepaid Ordinary Expenses set forth in the Supplement is
zero, the Supplement may provide that the Depositor shall pay to the Trustee
from time to time a fee for its services and expenses as Trustee as set forth in
the Supplement payable at the times set forth therein. In such cases, the
Trustee agrees that its right to receive such payments from the Depositor shall
constitute full and final satisfaction of and payment for all Ordinary Expenses
and that the Trustee shall have no claim for payment of Ordinary Expenses from
the Trust. The Trustee further agrees that, notwithstanding any failure by the
Depositor to make such periodic payments of the Ordinary Expenses, the Trustee
shall continue to perform its obligations under this Trust Agreement. The
Depositor's obligations to pay Ordinary Expenses under this Trust Agreement
shall be extinguished and of no further effect upon the payment of Ordinary
Expenses due and owing on the termination of the Trust pursuant to Section 10.01
hereof.
(e) Subject to paragraph (f) of this Section 7.06, all Extraordinary
Trust Expenses, to the extent not paid by a third party are, and shall be,
obligations of the Trust and when due and payable shall be satisfied solely by
the Trust.
(f) The Trustee shall not take any action, including appearing in,
instituting or conducting any action or suit hereunder or in relation hereto
which is not indemnifiable under Section 7.11 hereof which, in the Trustee's
opinion, would or might cause it to incur costs, expenses or liabilities that
are Extraordinary Trust Expenses unless (i) the Trustee is satisfied that it
will have adequate security or indemnity in respect of such costs, expenses and
liabilities, (ii) the Trustee has been instructed to do so by Certificateholders
representing not less than 100% of the aggregate principal amount of
Certificates then outstanding and (iii) such Certificateholders have agreed that
such costs, expenses or liabilities shall be paid by the Trustee from the Trust.
Section 7.07. Eligibility Requirements for Trustee. (a) The Trustee
hereunder shall at all times be a corporation or an association which is not an
Affiliate of the Depositor (but may have normal banking relationships with the
Depositor and its Affiliates) organized and doing business under the laws of any
State or the United States, authorized under such laws to exercise corporate
trust powers which shall be
43
eligible to act as a trustee under TIA Section 310(a), having a combined capital
and surplus of at least $50,000,000, subject to supervision or examination by
Federal or State authority and have a rating from S&P of BBB- or higher. If such
corporation or association publishes reports of conditions at least annually,
pursuant to law or to the requirements of the aforesaid supervising or examining
authority, then for the purposes of this Section 7.07 the combined capital and
surplus of such corporation or association shall be deemed to be its combined
capital and surplus as set forth in its most recent report of conditions so
published. In the event that at any time such Trustee shall cease to be eligible
in accordance with the provisions of this Section 7.07, such Trustee shall
resign immediately in the manner and with the effect specified in Section 7.08.
(b) In determining whether the Trustee has a conflicting interest
under TIA Section 310(b) with respect to any Class of Certificates and this
Section 7.07, each other Class of Certificate will be treated as having been
issued under an indenture other than this Trust Agreement.
Section 7.08. Resignation or Removal of the Trustee; Appointment of
Successor Trustee. (a) The Trustee may at any time resign as Trustee hereunder
by written notice of its election so to do, delivered to the Depositor, and such
resignation shall take effect upon the appointment of a successor Trustee and
its acceptance of such appointment as hereinafter provided; provided, however,
that in the event of such resignation, the Trustee shall (i) assist the
Depositor in finding a successor Trustee acceptable to the Depositor and (ii)
negotiate in good faith concerning any prepaid but unaccrued fees.
(b) The Depositor or Holders of the Required Percentage--Removal of
Trustee of Certificates may at any time remove the Trustee as Trustee hereunder
by written notice delivered to the Trustee in the manner provided in Section
11.04 hereof, and such removal shall take effect upon the appointment of the
successor Trustee and its acceptance of such appointment as provided in
paragraph (e) of this Section 7.08; provided, however, that in the event of such
removal, the Depositor shall negotiate in good faith with the Trustee in order
to agree regarding payment of the termination costs of the Trustee resulting
from such removal.
(c) Upon the designation and acceptance thereof of a successor
Trustee, following either resignation or removal of the Trustee, the Trustee
shall deliver to the successor Trustee all records relating to the Certificates
in the form and manner then maintained by the Trustee, which shall include a
hard copy thereof upon written request of the successor Trustee.
(d) If at any time the Trustee shall become incapable of acting or
shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or of
its property shall be appointed, or any public officer shall take charge or
control of the Trustee or of its property of affairs for the purpose of
rehabilitation, conservation or liquidation, the Depositor shall petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee. In the event the Trustee resigns or is
removed, the Trustee shall reimburse the Depositor for any fees or charges
previously paid to the Trustee in respect of duties not yet performed under this
Trust Agreement which remain to be performed by a successor Trustee.
(e) In case at any time the Trustee acting hereunder notifies the
Depositor that it elects to resign or the Depositor or Holders of the Required
Percentage--Removal of Trustee of Certificates notifies or notify the Trustee
that it or they elects or elect to remove the Trustee as Trustee, the Depositor
shall, within sixty (60) days after the delivery of the notice of resignation or
removal, appoint a successor Trustee, which shall satisfy the requirements for a
trustee under Section 7.07. If no successor Trustee has been appointed within
sixty (60) days after the Trustee has given written notice of its election to
resign or the Depositor or Holders of the Required Percentage--Removal of
Trustee of Certificates have given written notice to the Trustee of its or their
election to remove the Trustee, as the case may be, the Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
Every successor Trustee shall execute and deliver to its predecessor and to the
Depositor an instrument in writing accepting its appointment hereunder, and
thereupon such successor Trustee, without any further act or deed, shall become
fully vested with all the rights, powers, duties and obligations of its
predecessor and for all purposes shall be the Trustee under this Trust
Agreement, and such predecessor, upon payment of all sums due it and on the
written request of the Depositor, shall execute and deliver an instrument
transferring to such successor all rights, obligations and powers of such
predecessor hereunder, and shall duly assign, transfer and deliver all right,
title and interest in the Deposited Assets and parts thereof to such successor.
Any successor Trustee shall promptly give
44
notice of its appointment to the Certificateholders of Certificates for which it
is successor Trustee in the manner provided in Section 11.04 hereof.
(f) Any corporation into or with which the Trustee may be merged,
consolidated or converted shall be the successor of such Trustee without the
execution or filing of any document or any further act.
45
Section 7.09. Appointment of Office or Agency. As specified in a
Supplement, the Trustee shall appoint an office or agency in The City of New
York where the Certificates may be surrendered for registration of transfer or
exchange, and presented for the final distribution with respect thereto, and
where notices and demands to or upon the Trustee in respect of the Certificates
of the related Series and this Trust Agreement may be served.
Section 7.10. Representations and Warranties of Trustee. The Trustee
represents and warrants that:
(i) the Trustee is duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation or
association;
(ii) neither the execution nor the delivery by the Trustee of this
Trust Agreement, nor the consummation by it of the transactions
contemplated hereby nor compliance by it with any of the terms or
provisions hereof will contravene any Federal or New York law,
governmental rule or regulation governing the banking or trust powers of
the Trustee or any judgment or order binding on it, or violate its
charter documents or by-laws or constitute a default under (or an event
which, without notice or lapse of time or both, would constitute a
default) under, or result in the breach or acceleration of any material
contract, indenture, mortgage, agreement or instrument to which it is a
party or by which any of its properties may be bound;
(iii) the Trustee has full power, authority and right to execute,
deliver and perform its duties and obligations as set forth herein and in
each Supplement to which it is a party and has taken all necessary action
to authorize the execution, delivery and performance by it of this Trust
Agreement;
(iv) this Trust Agreement has been duly executed and delivered by
the Trustee and constitutes, subject to due execution by the Depositor,
the legal, valid and binding obligation of the Trustee, enforceable in
accordance with its terms, except as enforcement may be limited by the
applicable bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the rights of creditors generally and general principles
of equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law);
(v) the Trustee is not in violation, and the execution and delivery
of the Trust Agreement by the Trustee and its performance and compliance
with the terms thereof will not constitute a violation, of any order or
decree of any court or any order or regulation of any federal, state,
municipal or governmental agency having jurisdiction over the Trustee or
its properties, which violation would reasonably be expected to have a
material adverse effect on the condition (financial or otherwise) or
operations of the Trustee or its properties or on the performance of its
duties hereunder;
(vi) there are no actions or proceedings against, or investigations
of, the Trustee pending, or, to the knowledge of the Trustee, threatened,
before any court, administrative agency or other tribunal (A) that could
reasonably be expected to prohibit its entering into the Trust Agreement,
(B) seeking to prevent the issuance of the Certificates contemplated by
the Trust Agreement or (C) that could reasonably affect the performance
by the Trustee of its obligations under, or the validity or
enforceability against the Trustee of, the Trust Agreement; and
(vii) no consent, approval, authorization or order of any court,
governmental agency or body is required for the execution, delivery and
performance by the Trustee of, or compliance by the Trustee with, the
Trust Agreement, or for the consummation of the transactions contemplated
by the Trust Agreement, except for such consents, approvals,
authorizations and orders, if any, that have been obtained prior to the
Closing Date.
The representations and warranties of the Trustee set forth in this Section 7.10
shall survive the receipt of Underlying Securities by the Trustee and shall
survive the delivery of the Trust Agreement by the Trustee to the Depositor.
Section 7.11. Indemnification of Trustee by the Depositor;
Contribution. (a) The Depositor agrees, to the extent the Trustee is not
reimbursed pursuant to Section 7.06 hereof, to indemnify the Trustee against,
and hold it harmless from, any loss, expense or liability incurred in connection
with any Proceeding relating to this Trust
46
Agreement or the Certificates or the performance of any of the Trustee's duties
hereunder, other than any loss, liability or expense incurred by reason of
wilful misfeasance, bad faith or negligence in the performance of the Trustee's
duties hereunder or by reason of reckless disregard of the Trustee's obligations
and duties hereunder.
(b) If the indemnification provided for in paragraph (a) of this
Section 7.11 is invalid or unenforceable in accordance with its terms, then the
Depositor shall contribute to the amount paid or payable by the Trustee as a
result of such liability in such proportion as is appropriate to reflect the
relative benefits received by the Depositor on one hand and the Trustee as
Trustee on the other hand. For this purpose (i) the benefits received by the
Depositor shall be the aggregate amount received by it upon the sale of such
Certificates, less the costs and expenses of such sale, including the cost of
acquisition of the Underlying Securities or parts thereof evidenced thereby, and
(ii) the benefits received by the Trustee, as Trustee shall be the aggregate
amount of fees received by it as Trustee, less costs and expenses incurred by it
as Trustee in relation to such Certificates. If, however, the allocation
provided by the immediately preceding two sentences is not permitted by
applicable law, then the Depositor shall contribute to such amount paid or
payable by the Trustee in such proportion as is appropriate to reflect not only
such relative benefits but also the relative fault of the Depositor on the one
hand and the Trustee on the other in connection with the actions or omissions
which resulted in such liability, as well as any other relevant equitable
considerations.
(c) In case any claim shall be made or action brought against the
Trustee for any reason for which indemnity may be sought against the Depositor
as provided above, the Trustee may promptly notify the Depositor in writing
setting forth the particulars of such claim or action and the Depositor may
assume the defense thereof. In the event that the Depositor assumes the defense,
the Trustee shall have the right to retain separate counsel in any such action
but shall bear the fees and expenses of such counsel unless (i) the Depositor
shall have specifically authorized the retaining of such counsel or (ii) the
parties to such suit include the Trustee and the Depositor, and the Trustee has
been advised in writing by such counsel that one or more legal defenses may be
available to it which may not be available to the Depositor, in which case the
Depositor shall not be entitled to assume the defense of such suit
notwithstanding its obligation to bear the reasonable fees and expenses of such
counsel.
(d) The term "Liability", as used in this Section 7.11, shall
include any losses, claims, damages, expenses (including without limitation the
Trustee's reasonable costs, expenses and attorneys' fees and expenses) in
defending itself against any losses, claims or investigations of any nature
whatsoever.
(e) The obligations of the Depositor under this Section 7.11 shall
be in addition to any liability which the Depositor may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of the
Trustee, and to each person, if any, who controls the Trustee within the meaning
of the Exchange Act.
(f) Notwithstanding anything to the contrary contained in this
Section 7.11, the Depositor shall not be liable for settlement of any such claim
by the Trustee entered into without the prior written consent of the Depositor,
which consent shall not be unreasonably withheld.
(g) The indemnity provided in this Section 7.11 shall survive the
termination or discharge of this Trust Agreement.
Section 7.12. No Liability of the Trustee with Respect to the
Underlying Securities; Certificateholders to Proceed Directly Against the
Underlying Securities Issuer(s). (a) The sole obligor with respect to any
Underlying Security is the Underlying Securities Issuer(s). The Trustee shall
not have any obligation on or with respect to the Underlying Securities; and its
obligations with respect to Certificates shall be solely as set forth in this
Trust Agreement.
(b) The Trustee is not authorized to proceed against the Underlying
Securities Issuer in the event of a default or to assert the rights and
privileges of Certificateholders of Certificates and has no right or duty in
respect thereof except as expressly provided herein.
Section 7.13. The Depositor to Furnish Trustee with Names and
Addresses of Certificateholders. The Depositor will furnish to the Trustee
within 15 days after each
47
Record Date with respect to any Distribution Date, and at such other times as
the Trustee may request in writing, within 30 days after receipt by the
Depositor of any such request, a list, in such form as the Trustee may
reasonably require, of all information in the possession or control of the
Depositor as to the names and addresses of the Certificateholders, in each case
as of a date not more than 15 days prior to the time such list is furnished;
provided, however, that so long as the Trustee is the sole Registrar, no such
list need be furnished.
Section 7.14. Preservation of Information. The Trustee shall
preserve, in as current a form as is reasonably practicable, the names and
addresses of Certificateholders contained in the most recent list furnished to
the Trustee as provided in Section 7.14, and the names and addresses of
Certificateholders received by the Trustee in its capacity as Registrar, if so
acting. The Trustee may destroy any list furnished to it as provided in Section
7.14, upon receipt of a new list so furnished.
Section 7.15. Reports by Trustee. If required, within 60 days after
May 15 of each year, commencing with the year 1998, the Trustee shall transmit
to the Certificateholders, as provided in TIA Section 313(c), a brief report
dated as of such May 15, if required by TIA Section 313(a).
Section 7.16. Trustee's Application for Instructions from the
Depositor. Any application by the Trustee for written instructions from the
Depositor may, at the option of the Trustee, set forth in writing any action
proposed to be taken or omitted by the Trustee under this Trust Agreement and
the date on and/or after which such action shall be taken or such omission shall
be effective, if, but only if, the obligations of the Trustee with respect to
such proposed action or omission, in the view of the Trustee, are not set forth
reasonably clearly in these Standard Terms and the related Supplement. The
Trustee shall not be liable for any action taken by, or omission of, the Trustee
in accordance with a proposal included in such application on or after the date
specified in such application (which date shall not be less than ten (10)
Business Days after the date a Responsible Officer of the Depositor actually
receives such application, unless any such Responsible Officer shall have
consented in writing to any earlier date) unless, prior to taking any such
action (or the effective date in the case of an omission), the Trustee shall
have received written instructions in response to such application specifying
the action to be taken or omitted; provided, however, that this provision shall
not protect the Trustee from liability for any action or omission constituting
willful misconduct, bad faith or negligence.
ARTICLE VIII
MARKET AGENT
Section 8.01. Market Agent. (a) If specified for a given Series, on
the Closing Date the Trustee shall enter into a Market Agent Agreement with
Xxxxxxx Xxxxx & Co. as the initial Market Agent, in the form attached to the
related Supplement. The Market Agent shall serve as such under the terms and
provisions hereof and of the Market Agent Agreement. The Market Agent, including
any successor appointed pursuant hereto, shall be a member of the National
Association of Securities Dealers, Inc., have capitalization of at least
$25,000,000, and be authorized by law to perform all the duties imposed upon it
by this Trust Agreement and the Market Agent Agreement. The Market Agent may be
removed at any time by the Trustee, acting at the written direction of the
Depositor; provided, however, that such removal shall not take effect until the
appointment of a successor Market Agent. The Market Agent may resign upon 30
days' written notice delivered to the Trustee. The Depositor shall use its best
efforts to appoint a successor Market Agent that is a qualified institution,
effective as of the effectiveness of any such resignation or removal.
ARTICLE IX
SECURITIES INTERMEDIARY
Section 9.01. Resignation or Removal of the Securities Intermediary;
Appointment of Successor Securities Intermediary. (a) The Securities
Intermediary may at any time resign as Securities Intermediary hereunder by
written notice of its election so to do, delivered to the Trustee and the
Depositor, and such resignation shall take effect upon the appointment of a
successor Securities Intermediary and its acceptance of such appointment as
hereinafter provided; provided, however, that in the event of such resignation,
the Securities Intermediary shall (i) assist the Trustee and the Depositor
48
in finding a successor Securities Intermediary acceptable to the Trustee and the
Depositor and (ii) negotiate in good faith concerning any prepaid but unaccrued
fees.
(b) The Trustee, the Depositor or the Holders of the Required
Percentage--Removal of Securities Intermediary of Certificates may at any time
remove the Securities Intermediary as Securities Intermediary hereunder by
written notice delivered to the Securities Intermediary in the manner provided
in Section 11.04 hereof, and such removal shall take effect upon the appointment
of the successor Securities Intermediary and its acceptance of such appointment
as provided in paragraph (e) of this Section 9.01; provided, however, that in
the event of such removal, the Depositor shall negotiate in good faith with the
Securities Intermediary in order to agree regarding payment of the termination
costs of the Securities Intermediary resulting from such removal.
(c) Upon the designation and acceptance thereof of a successor
Securities Intermediary, following either resignation or removal of the
Securities Intermediary, the Securities Intermediary shall deliver to the
successor Securities Intermediary all records relating to the Certificates in
the form and manner then maintained by the Securities Intermediary, which shall
include a hard copy thereof upon written request of the successor Securities
Intermediary.
(d) If at any time the Securities Intermediary shall become
incapable of acting or shall be adjudged a bankrupt or insolvent, or a receiver
of the Securities Intermediary or of its property shall be appointed, or any
public officer shall take charge or control of the Securities Intermediary or of
its property of affairs for the purpose of rehabilitation, conservation or
liquidation, the Depositor shall petition any court of competent jurisdiction
for the removal of the Securities Intermediary and the appointment of a
successor Securities Intermediary. In the event the Securities Intermediary
resigns or is removed, the Securities Intermediary shall reimburse the Depositor
for any fees or charges previously paid to the Securities Intermediary in
respect of duties not yet performed under this Trust Agreement which remain to
be performed by a successor Securities Intermediary.
(e) In case at any time the Securities Intermediary acting hereunder
notifies the Trustee or the Depositor that it elects to resign or the Trustee,
the Depositor or Holders of the Required Percentage--Removal of Securities
Intermediary of Certificates notifies or notify the Securities Intermediary that
it or they elects or elect to remove the Securities Intermediary as Securities
Intermediary, the Depositor shall, within sixty (60) days after the delivery of
the notice of resignation or removal, appoint a successor Securities
Intermediary, which shall satisfy the requirements set forth in Section 2.06. If
no successor Securities Intermediary has been appointed within sixty (60) days
after the Securities Intermediary has given written notice of its election to
resign or the Trustee, the Depositor or Holders of the Required
Percentage--Removal of Securities Intermediary of Certificates have given
written notice to the Securities Intermediary of its or their election to remove
the Securities Intermediary, as the case may be, the Securities Intermediary may
petition any court of competent jurisdiction for the appointment of a successor
Securities Intermediary. Every successor Securities Intermediary shall execute
and deliver to its predecessor, to the Trustee and to the Depositor an
instrument in writing accepting its appointment hereunder, and thereupon such
successor Securities Intermediary, without any further act or deed, shall become
fully vested with all the rights, powers, duties and obligations of its
predecessor and for all purposes shall be the Securities Intermediary under this
Trust Agreement, and such predecessor, upon payment of all sums due it and on
the written request of the Trustee and the Depositor, shall execute and deliver
an instrument transferring to such successor all rights, obligations and powers
of such predecessor hereunder, and shall duly assign, transfer and deliver all
right, title and interest in the Deposited Assets and parts thereof to such
successor. Any successor Securities Intermediary shall promptly give notice of
its appointment to the Certificateholders of Certificates for which it is
successor Securities Intermediary in the manner provided in Section 11.04
hereof.
(f) Any corporation into or with which the Securities Intermediary
may be merged, consolidated or converted shall be the successor of such
Securities Intermediary without the execution or filing of any document or any
further act.
49
ARTICLE X
TERMINATION
Section 10.01. Termination upon Liquidation of All Underlying
Securities. (a) The respective obligations and responsibilities under this Trust
Agreement of the Depositor and the Trustee (other than the obligations of the
Trustee to make distributions to Holders of the Certificates of any given Series
as hereafter set forth and to provide information reports and information tax
reporting) shall terminate upon the distribution to such Holders of all amounts
held in all the Accounts for such Series and required to be paid to such Holders
pursuant to this Trust Agreement on the Distribution Date coinciding with the
final payment on or other liquidation (which may include redemption or other
purchase thereof by the applicable Underlying Securities Issuer) (or any Advance
with respect thereto) of the last Underlying Security remaining in the Trust for
such Series or the disposition of all property acquired upon liquidation of any
such Underlying Security; provided, however, that in no event shall any trust
created hereby continue beyond the earlier of (1) any date set forth in Section
13 of the applicable Supplement as the termination date for such trust or (2)
the expiration of 21 years from the death of the last survivor of the
descendants of Xxxxxx X. Xxxxxxx, the late ambassador of the United States to
the Court of St. Xxxxx, living on the date hereof.
(b) The Depositor shall provide the Trustee with written notice of
any of the events set forth in paragraph (a) of this Section 10.01.
(c) Upon presentation and surrender of the Certificates by the
Certificateholders on the Final Scheduled Distribution Date, or the Distribution
Date coinciding with or next following the earlier to occur of the occurrences
specified in paragraph (a) of this Section 10.01, with respect to the applicable
Series of Certificates, the Trustee shall distribute to each Holder presenting
and surrendering its Certificates (i) the amount otherwise distributable on such
Distribution Date in accordance with Section 4.01 in respect of the Certificates
so presented and surrendered, or (ii) as specified in the applicable Supplement,
if in connection with the Trustee's sale of all the remaining Underlying
Securities. Any funds not distributed on such Distribution Date shall be set
aside and held in trust for the benefit of Certificateholders not presenting and
surrendering their Certificates in the aforesaid manner, and shall be disposed
of in accordance with this Section 10.01 and Section 4.01 hereof. Immediately
following the deposit of funds in trust hereunder, the Trust for such Series
shall terminate. Subject to applicable escheat laws, the Trustee shall pay to
the Depositor any cash that remains unclaimed, together with interest, if any,
thereon, held by the Trustee on the date two years after such termination.
50
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01. Amendment. (a) Unless otherwise specified in the
applicable Supplement, this Trust Agreement may be amended from time to time by
the Depositor, the Trustee and the Securities Intermediary without notice to or
consent of any of the Certificateholders, for any of the following purposes:
(i) to cure any ambiguity;
(ii) to correct or supplement any provision herein that may be
inconsistent with any other provision herein or in the Supplement;
(iii) to change the Trustee or the Securities Intermediary for a
Series subsequent to the Closing Date for such Series;
(iv) to provide for administration of separate Trusts by more than
one trustee;
(v) to provide for a successor Trustee or successor Securities
Intermediary with respect to Certificates of one or more Series;
(vi) to provide for the issuance of a new Series pursuant to a
Supplement issued hereunder pursuant to Sections 5.01 and 5.12 hereof;
(vii) to add or supplement any Credit Support for the benefit of any
Certificateholders (provided, however, that if any such addition affects
any Series or Class of Certificateholders differently than any other
Series or Class of Certificateholders, then such addition will not, as
evidenced by an Opinion of Counsel, have a material adverse effect on the
interests of any affected Series or Class of Certificateholders);
(viii) to add to the covenants, restrictions or obligations of the
Depositor, the Trustee, the Securities Intermediary or the Administrative
Agent, if any, for the benefit of the Certificateholders;
(ix) to comply with any requirements imposed by the Code; or
(x) to add, change or eliminate any other provisions with respect to
matters or questions arising under this Trust Agreement.
Any amendment made pursuant to this paragraph (a) is subject to the
condition that such amendment shall satisfy the Rating Agency Condition with
respect to such amendment and shall not cause any Trust created hereunder to
fail to qualify as a fixed investment trust (or "grantor trust") for federal
income tax purposes.
(b) Without limiting the generality of the foregoing, unless
otherwise specified in the applicable Supplement, with respect to any Series,
this Trust Agreement may also be modified or amended from time to time by the
Depositor, the Trustee and the Securities Intermediary with the consent of the
Holders of Certificates representing the Required Percentage--Amendment of the
aggregate Voting Rights of those Certificates that are adversely affected by
such modification or amendment for the purpose of adding any provision to or
changing in any manner or eliminating any of the provisions of this Trust
Agreement or of modifying in any manner the rights of the Holders of
Certificates; provided, however, that no such amendment shall (i) reduce in any
manner the amount of, or delay the timing of, payments received on Underlying
Securities which are required to be distributed on any Certificate without the
consent of the Holders of such Certificates, (ii) reduce the percentage of
aggregate Voting Rights required to take any action specified in this Trust
Agreement, without the consent of the Holders of all Certificates of such Series
or Class then Outstanding, or (iii) cause any Trust created hereunder to fail to
qualify as a fixed investment trust (or "grantor trust") for federal income tax
purposes.
Notwithstanding any other provision of this Trust Agreement, for
purposes of the giving or withholding of consents pursuant to this Section
11.01, Certificates registered in the name of the Depositor, the Trustee, the
Securities Intermediary or any Affiliate of the Depositor, the Trustee or the
Securities Intermediary shall be entitled to Voting
51
Rights with respect to matters affecting such Certificates. Notwithstanding any
other provision of this Trust Agreement, this paragraph (b) shall not be amended
without the unanimous consent of the Holders of all such Certificates.
(c) Promptly after the execution of any such amendment or
modification, the Trustee shall furnish a copy of such amendment or modification
to each Certificateholder of the affected Series or Class and to the Rating
Agency. It shall not be necessary for the consent of Certificateholders under
this Section 11.01 to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
regulations as the Trustee may prescribe.
Section 11.02. Limitation on Rights of Certificateholders. (a) The
death or incapacity of any Certificateholder shall not operate to terminate this
Trust Agreement or the Trust, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
Proceeding in any court for a partition or winding up of the applicable Trust,
nor otherwise affect the rights, obligations and liabilities of the parties
hereto or any of them.
(b) No Certificateholder of a given Series shall have any right to
vote (except as expressly provided for herein) or in any manner otherwise
control the operation and management of any Trust, or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in the terms
of the Certificates, be construed so as to constitute the Certificateholders
from time to time as partners or members of an association; nor shall any
Certificateholder be under any liability to any third person by reason of any
action taken by the parties to this Trust Agreement other than pursuant to the
provisions hereof.
(c) No Certificateholder of a given Series shall have any right by
virtue of any provision of this Trust Agreement to institute any Proceeding in
equity or at law upon or under or with respect to this Trust Agreement, unless:
(i) such Holder previously shall have given to the Trustee a written
notice of breach of this Trust Agreement and of the continuance thereof;
(ii) the Holders of Certificates of such Series evidencing not less
than the Required Percentage--Remedies of the aggregate Voting Rights of
such Series shall have made written request upon the Trustee to institute
such Proceeding in its own name as Trustee hereunder;
(iii) such Certificateholder or Certificateholders shall have
offered to the Trustee such reasonable indemnity as it may require
against the costs, expenses and liabilities to be incurred therein or
thereby;
(iv) the Trustee, for 15 days after its receipt of such notice,
request and offer of indemnity, shall have neglected or refused to
institute any such Proceeding; and
(v) no direction inconsistent with such written request has been
given to the Trustee during such 15-day period by Certificateholders
evidencing not less than the Required Percentage--Remedies of the
aggregate Voting Rights of such Series.
It is understood and agreed that the Trustee shall not be obligated to make any
investigation of matters arising under this Trust Agreement or to institute,
conduct or defend any Proceeding hereunder or in relation hereto at the request,
order or direction of any Certificateholders unless such Certificateholders have
offered to the Trustee the reasonable indemnity referred to above. It is further
understood and agreed, and expressly covenanted by each Certificateholder of
each Series with every other Certificateholder of such Series and the Trustee,
that no one or more Holders of Certificates of such Series shall have any right
in any manner whatever by virtue of any provision of this Trust Agreement to
affect, disturb or prejudice the rights of the Holders of any other of the
Certificates of such Series, or to obtain or seek to obtain priority over or
preference to any other such Holder, or to enforce any right under this Trust
Agreement, except in the manner herein provided and for the equal, ratable and
common benefit of all Certificateholders of such Series. For the protection and
enforcement of the provisions of this Section 11.02, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
52
Section 11.03. Governing Law. This Trust Agreement (including,
without limitation, the establishment and maintenance of Certificate Accounts
and all interests, duties and obligations of the parties hereunder or thereunder
or with respect hereto or thereto) and each Certificate shall be construed in
accordance with and governed by the law of the State of New York.
Section 11.04. Notices. (a) All directions, demands and notices
hereunder shall be in writing and shall be delivered as set forth in the
applicable Supplement.
(b) Any notice required to be provided to a Holder shall be given by
first class mail, postage prepaid, at the last address of such Holder as shown
in the Certificate Register. Any notice so mailed within the time prescribed in
this Trust Agreement shall be conclusively presumed to have been duly given when
mailed, whether or not the Certificateholder receives such notice.
(c) Any and all notices to be given to the Depositor shall be deemed
to have been duly given if sent by facsimile transmission to the Depositor at
Xxxxxxx Xxxxx & Co., World Financial Center, New York, New York 10281,
Attention: Xxxxx X. Xxxxx, facsimile transmission number (000) 000-0000,
telephone confirmation number (212) 449- 6177. The Depositor may change this
information by written notice to the Trustee and to the Securities Intermediary.
(d) Any and all notices to be given to the Trustee shall be deemed
to have been duly given if sent by facsimile transmission to the Trustee at
United States Trust Company of New York, 000 Xxxx 00xx Xxxxxx, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: STEERS, referencing the designation of the
applicable Series, facsimile transmission number (000) 000-0000, telephone
confirmation number (000) 000-0000. The Trustee may change this information by
notice to the Depositor and to the Securities Intermediary.
(e) Any and all notices to be given to the Securities Intermediary
shall be deemed to have been duly given if sent by facsimile transmission to the
Securities Intermediary at United States Trust Company of New York, 000 Xxxx
00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: STEERS,
referencing the designation of the applicable Series, facsimile transmission
number (000) 000-0000, telephone confirmation number (000) 000-0000. The
Securities Intermediary may change this information by notice to the Depositor
and to the Trustee.
(f) Any and all notices to be given to the Swap Counterparty, if
any, will be specified in the Supplement.
Section 11.05. Notice to Rating Agencies. (a) The Trustee shall use
its best efforts promptly to provide notice to each Rating Agency with respect
to each of the following of which it has actual knowledge:
(i) any change or amendment to this Trust Agreement;
(ii) the resignation or termination of the Trustee;
(iii) the final payment to Holders of the Certificates of any Class;
(iv) any change in the location of the Certificate Account; and
(v) any event that would result in the inability of the Trustee to
make Advances.
(b) In addition, the Trustee shall promptly furnish to each Rating
Agency copies of each report to Certificateholders described in Section 4.03.
(c) Any such notice pursuant to this Section 11.05 shall be in
writing and shall be deemed to have been duly given if personally delivered or
mailed by first class mail, postage prepaid, or by express delivery service to
each Rating Agency at the address specified below or in the applicable
Supplement.
(d) (i) Any and all notices to be given to Moody's shall be deemed
to have been duly given if sent by facsimile transmission to Moody's at Xxxxx'x
Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
CBO/CLO Monitoring
53
Department, facsimile transmission number (000) 000-0000, telephone confirmation
number (000) 000-0000. Moody's may change this information by notice to the
Depositor and the Trustee.
(ii) Any and all notices to be given to S&P shall be deemed to have
been duly given if sent by facsimile transmission to S&P at Standard &
Poor's Rating Group, 00 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Structured Finance Surveillance Group, facsimile transmission number
(000) 000-0000, telephone confirmation number (000) 000-0000. S&P may
change this information by notice to the Depositor and the Trustee.
(iii) Any and all notices to be given to DCR shall be deemed to have
been duly given in sent by facsimile transmission to DCR at Duff & Xxxxxx
Credit Rating Co., 00 X. Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, XX
00000-0000, Attention: Xxxxx X'Xxxxxxx, facsimile transmission number
(000) 000-0000, telephone confirmation number (312) 368- 3100. DCR may
change this information by notice to the Depositor and the Trustee.
(iv) Any and all notices to be given to Fitch shall be deemed to
have been duly given in sent by facsimile transmission to Fitch at Fitch
Investors Service, L.P., Xxx Xxxxx Xxxxxx Xxxxx, Xxx Xxxx, XX 00000,
facsimile transmission number (000) 000-0000, telephone confirmation
number (000) 000-0000. Fitch may change this information by notice to the
Depositor and the Trustee.
Section 11.06. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Trust Agreement shall be for
any reason whatsoever held invalid, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Trust Agreement and shall in no way affect the
validity or enforceability of the other provisions of this Trust Agreement or of
the Certificates or the rights of the Holders thereof.
Section 11.07. Nonpetition Covenant. Notwithstanding any prior
termination of this Trust Agreement, each of the Trustee (including any
Administrative Agent, Authenticating Agent and Paying Agent) and the Depositor
agrees that it shall not, until the date which is one year and one day after the
termination of a Series, acquiesce, petition or otherwise invoke or cause a
Trust to invoke the process of the United States, any State or other political
subdivision thereof or any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government for the
purpose of commencing or sustaining a case by or against the Trust under a
Federal or state bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official
of such Trust or all or any part of the property or assets of such Trust or
ordering the winding up or liquidation of the affairs of such Trust.
Section 11.08. No Recourse. None of the Trustee (including any
Administrative Agent, Authenticating Agent or Paying Agent), the Securities
Intermediary or the Depositor shall have any recourse to the Underlying
Securities, except as specifically provided in the related Supplement.
Section 11.09. Article and Section References. All Article and
Section references used in these Standard Terms, unless otherwise provided, are
to Articles and Sections in these Standard Terms.
Section 11.10. Counterparts. These Standard Terms may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute one and the
same instrument.
Section 11.11. Trust Indenture Act. This Trust Agreement is subject
to the provisions of the TIA and shall, to the extent applicable, be governed by
such provisions. The Trustee agrees to take all actions within its control to
prevent these Standard Terms, as supplemented by any Supplements, from failing
to qualify under the TIA.
54
IN WITNESS WHEREOF, the Depositor, the Trustee and the Securities
Intermediary have caused these Standard Terms to be duly executed by their
respective officers thereunto duly authorized, in each case as of the day and
year first above written.
XXXXXXX XXXXX DEPOSITOR, INC.,
as Depositor
By: /s/ Xxxxx X. Xxxxx
------------------------------
Name: Xxxxx X. Xxxxx
Title: President
UNITED STATES TRUST COMPANY OF NEW YORK,
as Trustee
By: /s/ Xxxx Xxxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
UNITED STATES TRUST COMPANY OF NEW YORK,
as Securities Intermediary
By: /s/ Xxxx Xxxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
55
EXHIBIT B
Form of Class A Certificate
TRUST CERTIFICATE
No. A-1 $35,000,000 CUSIP NO. 73941X 77 5
SEE REVERSE FOR CERTAIN DEFINITIONS
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR THE INDIVIDUAL
CERTIFICATES REPRESENTED HEREBY, THIS CERTIFICATE MAY NOT BE TRANSFERRED EXCEPT
AS A WHOLE BY DTC TO CEDE & CO. OR BY CEDE & CO. TO DTC OR TO ANOTHER NOMINEE OF
DTC OR BY DTC OR CEDE & CO. TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITORY.
THIS CERTIFICATE REPRESENTS A FRACTIONAL UNDIVIDED INTEREST IN THE TRUST AND
DOES NOT EVIDENCE AN OBLIGATION OF, OR AN INTEREST IN, AND IS NOT GUARANTEED BY
THE DEPOSITOR OR THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS
CERTIFICATE NOR THE DEPOSITED ASSETS ARE INSURED OR GUARANTEED BY ANY
GOVERNMENTAL AGENCY OR ANY OTHER PERSON.
THE HOLDER OF THIS CERTIFICATE SHALL HAVE NO DIRECT RIGHT TO PRINCIPAL OR
INTEREST PAYMENTS IN RESPECT OF THE UNDERLYING SECURITIES. THE REGISTERED HOLDER
HEREOF, BY ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL LOOK SOLELY TO THE ASSETS
DEPOSITED IN THE TRUST, TO THE EXTENT OF ITS RIGHTS THEREIN, FOR DISTRIBUTIONS
HEREUNDER.
PPLUS TRUST SERIES CMT-1
1,400,000 PPLUS CLASS A 6.25% TRUST CERTIFICATES SERIES CMT-1
$35,000,000 STATED AMOUNT TRUST CERTIFICATES
($25 STATED AMOUNT PER TRUST CERTIFICATE)
evidencing a fractional undivided beneficial ownership interest in the Trust, as
defined below, the property of which consists principally of $35,000,000
aggregate principal amount of 7.05% Notes due 2033 (the "Underlying Securities")
issued by Comcast Corporation, a Pennsylvania corporation, and all payments
received thereon, deposited in trust by Xxxxxxx Xxxxx Depositor, Inc. (the
"Depositor").
THIS CERTIFIES THAT CEDE & CO. is the registered owner of a
nonassessable, fully-paid, fractional undivided interest in the PPLUS Trust
Series CMT-1 formed by the Depositor. Under the Trust Agreement, the Class A
Certificateholders are entitled to receive on each Distribution Date until March
15, 2033, the distributions, if any, received on the Underlying Securities,
which will represent distributions at a rate of 6.25% per annum on the Stated
Amount of the Certificates.
The Trust was created pursuant to a Standard Terms for Trust
Agreements, dated as of February 20, 1998 (the "Standard Terms"), between the
Depositor and The Bank of New York, as successor to United States Trust Company
of New York, a New York corporation, as Trustee (the "Trustee") and as
securities intermediary (the "Securities Intermediary"), as supplemented by the
Series Supplement, dated as of April 16, 2004 (the "Series Supplement" and,
together with the Standard Terms, the "Trust Agreement"), between the Depositor
and the Trustee and the Securities Intermediary. This Certificate does not
purport to summarize the Trust Agreement and reference is hereby made to the
Trust Agreement for information with respect to the interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
obligations of the Trustee with respect hereto. A copy of the Trust Agreement
may be obtained from the Trustee by written request sent to the Corporate Trust
Office. Capitalized terms used but not defined herein have the meanings assigned
to them in the Trust Agreement.
This Certificate is one of the duly authorized Certificates designated
as the PPLUS Class A 6.25% Trust Certificates Series CMT-1 (herein called the
"Certificates"). This Certificate is issued under and is subject to the terms,
provisions and conditions of the Trust Agreement, to which Trust Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound. Further, subject to the terms, provisions and
conditions of the Trust Agreement, the Trust will issue Call Rights, which will
be sold in one or more privately negotiated transactions. The rights of the
Certificateholders under the Trust Agreement and this Certificate are limited by
the terms, provisions and conditions of the Trust Agreement and the Warrant
Agreement with respect to the exercise of Call Rights by the holders of Call
Rights. The Certificateholders, by their acceptance of the Certificates,
covenant and agree to tender any and all Certificates to the Warrant Agent upon
the holder's exercise of Call
Rights and deposit of the Call Price with the Escrow Agent for such Certificates
in accordance with the applicable procedures in the Warrant Agreement. The
property of the Trust consists of the Underlying Securities, all payments
received or receivable on the Underlying Securities accrued on or after the
Cut-off Date, and the other Deposited Assets, if any, all as more fully
specified in the Trust Agreement.
Subject to the terms and conditions of the Trust Agreement (including
the availability of funds for distributions) and until the obligation created by
the Trust Agreement shall have terminated in accordance therewith, distributions
will be made on each Distribution Date to the Person in whose name this
Certificate is registered on the applicable Record Date, in an amount equal to
such Certificateholder's fractional undivided interest in the amount required to
be distributed to the Holders of the Certificates on such Distribution Date. The
Record Date applicable to any Distribution Date is the close of business on the
day immediately preceding such Distribution Date.
Each Certificateholder, by its acceptance of a Certificate, covenants
and agrees that such Certificateholder will not at any time institute against
the Trust, or join in any institution against the Trust of, any bankruptcy
proceedings under any United States federal or state bankruptcy or similar law
in connection with any obligations relating to the Certificates or the Trust
Agreement.
Distributions made on this Certificate will be made as provided in the
Trust Agreement by the Trustee by check mailed to the Certificateholder of
record in the Certificate Register or by wire transfer to an account designated
by such Holder without the presentation or surrender of this Certificate or the
making of any notation hereon of, except that with respect to Certificates
registered on the Record Date in the name of the nominee of the Clearing Agency
(initially, such nominee shall be Cede & Co.), payments will be made by wire
transfer in immediately available funds to the account designated by such
nominee. Except as otherwise provided in the Trust Agreement and notwithstanding
the above, the final distribution on this Certificate will be made after due
notice by the Trustee of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the Corporate Trust Office or
such other location as may be specified in such notice.
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
The Trustee does not assume responsibility for the accuracy of the
statements in the Certificate (and the reverse hereof).
Unless the certificate of authentication hereon has been executed by
or on behalf of the Trustee, this Certificate shall not entitle the Holder
hereof to any benefit under the Trust Agreement or be valid for any purpose.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE LAW OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the Trustee has caused this Class A Certificate to
be duly executed as of the date set forth below.
PPLUS TRUST SERIES CMT-1
By: THE BANK OF NEW YORK,
solely in its capacity as Trustee
under the Trust Agreement and not
in its individual capacity
Dated: April 16, 2004 By:
-----------------------------------
Authorized Signatory
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates described in the Trust
Agreement referred to herein.
PPLUS TRUST SERIES CMT-1
By: THE BANK OF NEW YORK,
solely in its capacity as Trustee
under the Trust Agreement and not
in its individual capacity
Dated: April 16, 2004 By:
-----------------------------------
Authorized Signatory
[TRUST CERTIFICATE - CLASS A SIGNATURE PAGE]
(REVERSE OF CERTIFICATE)
The Certificates are limited in right of distribution to certain
payments and collections respecting the Underlying Securities, all as more
specifically set forth herein and in the Trust Agreement. The registered Holder
hereof, by its acceptance hereof, agrees that it will look solely to the
Deposited Assets (to the extent of its rights therein) for interest
distributions hereunder. Both the Underlying Securities and Call Holders that
exercise their Call Rights may be sources of principal distributions on the
Certificates. The rights of the Certificate-holders under the Trust Agreement
and this Certificate are limited by the terms, provisions and conditions of the
Trust Agreement and the Warrant Agreement with respect to the exercise of Call
Rights by the holders of Call Rights. The Certificateholders, by their
acceptance of the Certificates, covenant and agree to tender any and all
Certificates to the Warrant Agent upon the holder's exercise of Call Rights and
deposit of the Call Price with the Escrow Agent for such Certificates in
accordance with the applicable procedures in the Warrant Agreement.
The Trust Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of the
Depositor and the Trustee and the rights of the Certificateholders under the
Trust Agreement at any time by the Depositor and the Trustee with the consent of
the Holders of Certificates evidencing greater than 66 2/3% of the aggregate
Voting Rights of the Certificates subject to certain provisions set forth in the
Trust Agreement. Any such consent by the Holder of this Certificate (or any
predecessor Certificate) shall be conclusive and binding on such Holder and upon
all future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange hereof or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Trust Agreement also permits
the amendment thereof, in certain limited circumstances, without the consent of
the Holders of any of the Certificates.
As provided in the Trust Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies of the Certificate Registrar maintained by
the Trustee in the Borough of Manhattan, The City of New York, duly endorsed by,
or accompanied by an assignment in the form below and by such other documents as
required by the Trust Agreement signed by, the Holder hereof, and thereupon one
or more new Certificates of the same class in Authorized Denominations
evidencing the same principal amount will be issued to the designated transferee
or transferees. The initial Certificate Registrar appointed under the Trust
Agreement is United States Trust Company of New York.
No service charge will be made for any registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection with any
transfer or exchange of Certificates.
The Depositor, the Trustee and the Securities Intermediary and any
agent of the Depositor, the Trustee or the Securities Intermediary may treat the
Person in whose name this Certificate is registered as the owner hereof for all
purposes, and neither the Depositor, the Trustee, or the Securities Intermediary
nor any such agent shall be affected by any notice to the contrary.
It is the intention of the parties to the Trust Agreement that the
Trust created thereunder shall constitute a fixed investment trust for United
States federal income tax purposes under Treasury Regulation Section 301.7701-4,
and the Certificateholder, by its acceptance of this Certificate, agrees to
treat the Certificates, the distributions from the Trust and its beneficial
interest in the Trust consistently with such characterization.
The Trust may not engage in any business or activities other than in
connection with, or relating to, the holding, protecting and preserving of the
Deposited Assets and the issuance of the Certificates and the Call Rights, and
other than those required or authorized by the Trust Agreement or incidental and
necessary to accomplish such activities. The Trust may not issue or sell any
certificates or other obligations other than the Certificates and the Call
Rights or otherwise incur, assume or guarantee any indebtedness for money
borrowed.
The Trust and the obligations of the Depositor, the Trustee and the
Securities Intermediary created by the Trust Agreement with respect to the
Certificates shall terminate upon the earlier of (i) the payment in full at
maturity or sale by the Trust after a payment default on or an acceleration or
other early payment of the Underlying Securities and the distribution in full of
all amounts due in respect of the Certificates and (ii) March 15, 2033.
If an employee benefit plan subject to the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), including an individual retirement
account or Xxxxx plan (each, a "Plan"), purchases Certificates, certain aspects
of such investment, including the operation of the Trust, might be subject to
the prohibited transaction provisions under ERISA and the Internal Revenue Code
of 1986, as amended (the "Code"), unless certain exemptions apply. A Plan should
consult its advisors concerning the ability of such Plan to purchase
Certificates under ERISA or the Code.
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers
unto
--------------------------------------------------------------------------------
(PLEASE INSERT SOCIAL SECURITY OR TAXPAYER IDENTIFICATION OR OTHER IDENTIFYING
NUMBER OF ASSIGNEE)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(PLEASE PRINT OR TYPE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE, OF ASSIGNEE)
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
_________________________________________ Attorney to transfer said Certificate
on the books of the Certificate Registrar, with full power of substitution in
the premises.
Dated:
Signature : _______________________________________*
Signature Guarantee : _______________________________________*
* NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a brokerage firm or financial institution that is a member of a
Securities Approved Medallion Program such as Securities Transfer Agents
Medallion Program (STAMP), Stock Exchange Medallion Program (SEMP) or New York
Stock Exchange Inc. Medallion Signature Program (MSP).
OPTION TO ELECT EXCHANGE
If you wish to have this Certificate, or a portion thereof, exchanged
by the Trustee pursuant to Section 4.07 of the Standard Terms, check the Box: __
If you wish to have less than all of this Certificate exchanged, state
the amount:
$ .
-------------------------
Date:
Your Signature :
--------------------------------
(Sign exactly as your name appears
on the other side of this Certificate)
Signature Guarantee :
--------------------------------
EXHIBIT C
Form of Class B Certificate
TRUST CERTIFICATE
No. B-1 CUSIP NO. 73941X 76 7
SEE REVERSE FOR CERTAIN DEFINITIONS
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR THE INDIVIDUAL
CERTIFICATES REPRESENTED HEREBY, THIS CERTIFICATE MAY NOT BE TRANSFERRED EXCEPT
AS A WHOLE BY DTC TO CEDE & CO. OR BY CEDE & CO. TO DTC OR TO ANOTHER NOMINEE OF
DTC OR BY DTC OR CEDE & CO. TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITORY.
THIS CERTIFICATE REPRESENTS A FRACTIONAL UNDIVIDED INTEREST IN THE TRUST AND
DOES NOT EVIDENCE AN OBLIGATION OF, OR AN INTEREST IN, AND IS NOT GUARANTEED BY
THE DEPOSITOR OR THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS
CERTIFICATE NOR THE DEPOSITED ASSETS ARE INSURED OR GUARANTEED BY ANY
GOVERNMENTAL AGENCY OR ANY OTHER PERSON.
THE HOLDER OF THIS CERTIFICATE SHALL HAVE NO DIRECT RIGHT TO PRINCIPAL OR
INTEREST PAYMENTS IN RESPECT OF THE UNDERLYING SECURITIES. THE REGISTERED HOLDER
HEREOF, BY ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL LOOK SOLELY TO THE ASSETS
DEPOSITED IN THE TRUST, TO THE EXTENT OF ITS RIGHTS THEREIN, FOR DISTRIBUTIONS
HEREUNDER.
PPLUS TRUST SERIES CMT-1
1,400,000 PPLUS CLASS B 0.80% TRUST CERTIFICATES SERIES CMT-1
($25 NOTIONAL PRINCIPAL AMOUNT PER TRUST CERTIFICATE)
evidencing a fractional undivided beneficial ownership interest in the Trust, as
defined below, the property of which consists principally of $35,000,000
aggregate principal amount of 7.05% Notes due 2033 (the "Underlying Securities")
issued by Comcast Corporation, a Pennsylvania corporation, and all payments
received thereon, deposited in trust by Xxxxxxx Xxxxx Depositor, Inc. (the
"Depositor").
THIS CERTIFIES THAT CEDE & CO. is the registered owner of a
nonassessable, fully-paid, fractional undivided interest in the PPLUS Trust
Series CMT-1 formed by the Depositor. Under the Trust Agreement, the Class B
Certificateholders are entitled to receive on each Distribution Date until March
15, 2033, the distributions, if any, received on the Underlying Securities,
which will represent distributions at a rate of 0.80% per annum on the principal
amount of the Underlying Securities.
The Trust was created pursuant to a Standard Terms for Trust
Agreements, dated as of February 20, 1998 (the "Standard Terms"), between the
Depositor and The Bank of New York, as successor to United States Trust Company
of New York, a New York corporation, as Trustee (the "Trustee") and as
securities intermediary (the "Securities Intermediary"), as supplemented by the
Series Supplement, dated as of April 16, 2004 (the "Series Supplement" and,
together with the Standard Terms, the "Trust Agreement"), between the Depositor
and the Trustee and the Securities Intermediary. This Certificate does not
purport to summarize the Trust Agreement and reference is hereby made to the
Trust Agreement for information with respect to the interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
obligations of the Trustee with respect hereto. A copy of the Trust Agreement
may be obtained from the Trustee by written request sent to the Corporate Trust
Office. Capitalized terms used but not defined herein have the meanings assigned
to them in the Trust Agreement.
This Certificate is one of the duly authorized Certificates designated
as the PPLUS Class B 0.80% Trust Certificates Series CMT-1 (herein called the
"Certificates"). This Certificate is issued under and is subject to the terms,
provisions and conditions of the Trust Agreement, to which Trust Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound. Further, subject to the terms, provisions and
conditions of the Trust Agreement, the Trust will issue Call Rights, which will
be sold in one or more privately negotiated transactions. The rights of the
Certificateholders under the Trust Agreement and this Certificate are limited by
the terms, provisions and conditions of the Trust Agreement and the Warrant
Agreement with respect to the exercise of Call Rights by the holders of Call
Rights. The Certificateholders, by their acceptance of the Certificates,
covenant and agree to tender any and all Certificates to the Warrant Agent upon
the holder's exercise of Call Rights and deposit of the Call Price with the
Escrow Agent for such Certificates in accordance with the applicable procedures
in the Warrant Agreement. The property of the Trust consists of the Underlying
Securities, all payments received or receivable on the Underlying Securities
accrued on or after the Cut-off Date, and the other Deposited Assets, if any,
all as more fully specified in the Trust Agreement.
Subject to the terms and conditions of the Trust Agreement (including
the availability of funds for distributions) and until the obligation created by
the Trust Agreement shall have terminated in accordance therewith, distributions
will be made on each Distribution Date to the Person in whose name this
Certificate is registered on the applicable Record Date, in an amount equal to
such Certificateholder's fractional undivided interest in the amount required to
be distributed to the Holders of the Certificates on such Distribution Date. The
Record Date applicable to any Distribution Date is the close of business on the
day immediately preceding such Distribution Date.
Each Certificateholder, by its acceptance of a Certificate, covenants
and agrees that such Certificateholder will not at any time institute against
the Trust, or join in any institution against the Trust of, any bankruptcy
proceedings under any United States federal or state bankruptcy or similar law
in connection with any obligations relating to the Certificates or the Trust
Agreement.
Distributions made on this Certificate will be made as provided in the
Trust Agreement by the Trustee by check mailed to the Certificateholder of
record in the Certificate Register or by wire transfer to an account designated
by such Holder without the presentation or surrender of this Certificate or the
making of any notation hereon of, except that with respect to Certificates
registered on the Record Date in the name of the nominee of the Clearing Agency
(initially, such nominee shall be Cede & Co.), payments will be made by wire
transfer in immediately available funds to the account designated by such
nominee. Except as otherwise provided in the Trust Agreement and notwithstanding
the above, the final distribution on this Certificate will be made after due
notice by the Trustee of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the Corporate Trust Office or
such other location as may be specified in such notice.
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
The Trustee does not assume responsibility for the accuracy of the
statements in the Certificate (and the reverse hereof).
Unless the certificate of authentication hereon has been executed by
or on behalf of the Trustee, this Certificate shall not entitle the Holder
hereof to any benefit under the Trust Agreement or be valid for any purpose.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE LAW OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the Trustee has caused this Class B Certificate to
be duly executed as of the date set forth below.
PPLUS TRUST SERIES CMT-1
By: THE BANK OF NEW YORK,
solely in its capacity as Trustee
under the Trust Agreement and not
in its individual capacity
Dated: April 16, 2004 By:
-----------------------------------
Authorized Signatory
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates described in the Trust
Agreement referred to herein.
PPLUS TRUST SERIES CMT-1
By: THE BANK OF NEW YORK,
solely in its capacity as Trustee
under the Trust Agreement and not
in its individual capacity
Dated: April 16, 2004 By:
-----------------------------------
Authorized Signatory
[TRUST CERTIFICATE - CLASS B SIGNATURE PAGE]
(REVERSE OF CERTIFICATE)
The Certificates are limited in right of distribution to certain
payments and collections respecting the Underlying Securities, all as more
specifically set forth herein and in the Trust Agreement. The registered Holder
hereof, by its acceptance hereof, agrees that it will look solely to the
Deposited Assets (to the extent of its rights therein) for interest
distributions hereunder. Both the Underlying Securities and Call Holders that
exercise their Call Rights may be sources of principal distributions on the
Certificates. The rights of the Certificate-holders under the Trust Agreement
and this Certificate are limited by the terms, provisions and conditions of the
Trust Agreement and the Warrant Agreement with respect to the exercise of Call
Rights by the holders of Call Rights. The Certificateholders, by their
acceptance of the Certificates, covenant and agree to tender any and all
Certificates to the Warrant Agent upon the holder's exercise of Call Rights and
deposit of the Call Price with the Escrow Agent for such Certificates in
accordance with the applicable procedures in the Warrant Agreement.
The Trust Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of the
Depositor and the Trustee and the rights of the Certificateholders under the
Trust Agreement at any time by the Depositor and the Trustee with the consent of
the Holders of Certificates evidencing greater than 66 2/3% of the aggregate
Voting Rights of the Certificates subject to certain provisions set forth in the
Trust Agreement. Any such consent by the Holder of this Certificate (or any
predecessor Certificate) shall be conclusive and binding on such Holder and upon
all future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange hereof or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Trust Agreement also permits
the amendment thereof, in certain limited circumstances, without the consent of
the Holders of any of the Certificates.
As provided in the Trust Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies of the Certificate Registrar maintained by
the Trustee in the Borough of Manhattan, The City of New York, duly endorsed by,
or accompanied by an assignment in the form below and by such other documents as
required by the Trust Agreement signed by, the Holder hereof, and thereupon one
or more new Certificates of the same class in Authorized Denominations
evidencing the same principal amount will be issued to the designated transferee
or transferees. The initial Certificate Registrar appointed under the Trust
Agreement is United States Trust Company of New York.
No service charge will be made for any registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection with any
transfer or exchange of Certificates.
The Depositor, the Trustee and the Securities Intermediary and any
agent of the Depositor, the Trustee or the Securities Intermediary may treat the
Person in whose name this Certificate is registered as the owner hereof for all
purposes, and neither the Depositor, the Trustee, or the Securities Intermediary
nor any such agent shall be affected by any notice to the contrary.
It is the intention of the parties to the Trust Agreement that the
Trust created thereunder shall constitute a fixed investment trust for United
States federal income tax purposes under Treasury Regulation Section 301.7701-4,
and the Certificateholder, by its acceptance of this Certificate, agrees to
treat the Certificates, the distributions from the Trust and its beneficial
interest in the Trust consistently with such characterization.
The Trust may not engage in any business or activities other than in
connection with, or relating to, the holding, protecting and preserving of the
Deposited Assets and the issuance of the Certificates and the Call Rights, and
other than those required or authorized by the Trust Agreement or incidental and
necessary to accomplish such activities. The Trust may not issue or sell any
certificates or other obligations other than the Certificates and the Call
Rights or otherwise incur, assume or guarantee any indebtedness for money
borrowed.
The Trust and the obligations of the Depositor, the Trustee and the
Securities Intermediary created by the Trust Agreement with respect to the
Certificates shall terminate upon the earlier of (i) the payment in full at
maturity or sale by the Trust after a payment default on or an acceleration or
other early payment of the Underlying Securities and the distribution in full of
all amounts due in respect of the Certificates and (ii) March 15, 2033.
If an employee benefit plan subject to the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), including an individual retirement
account or Xxxxx plan (each, a "Plan"), purchases Certificates, certain aspects
of such investment, including the operation of the Trust, might be subject to
the prohibited transaction provisions under ERISA and the Internal Revenue Code
of 1986, as amended (the "Code"), unless certain exemptions apply. A Plan should
consult its advisors concerning the ability of such Plan to purchase
Certificates under ERISA or the Code.
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers
unto
--------------------------------------------------------------------------------
(PLEASE INSERT SOCIAL SECURITY OR TAXPAYER IDENTIFICATION OR OTHER IDENTIFYING
NUMBER OF ASSIGNEE)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(PLEASE PRINT OR TYPE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE, OF ASSIGNEE)
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
_____________________________ Attorney to transfer said Certificate on the books
of the Certificate Registrar, with full power of substitution in the premises.
Dated:
Signature : *
--------------------------------
Signature Guarantee : *
--------------------------------
* NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a brokerage firm or financial institution that is a member of a
Securities Approved Medallion Program such as Securities Transfer Agents
Medallion Program (STAMP), Stock Exchange Medallion Program (SEMP) or New York
Stock Exchange Inc. Medallion Signature Program (MSP).
OPTION TO ELECT EXCHANGE
If you wish to have this Certificate, or a portion thereof, exchanged
by the Trustee pursuant to Section 4.07 of the Standard Terms, check the Box:|_|
If you wish to have less than all of this Certificate exchanged, state
the amount:
$ .
-------------------
Date:
Your Signature :
------------------------------------
(Sign exactly as your name appears
on the other side of this Certificate)
Signature Guarantee :
------------------------------------
EXHIBIT D
Market Agent Agreement
MARKET AGENT AGREEMENT
----------------------
MARKET AGENT AGREEMENT, dated as of April 16, 2004 (the "Agreement"),
by and between Xxxxxxx Xxxxx & Co. ("Xxxxxxx Xxxxx & Co.") and the PPLUS Trust
Series CMT-1 (the "Trust"), a New York trust created under the Standard Terms
for Trust Agreements, dated as of February 20, 1998 (the "Standard Terms"),
between Xxxxxxx Xxxxx Depositor, Inc., as depositor (the "Depositor") and The
Bank of New York, as successor to United States Trust Company of New York, as
trustee (the "Trustee") and as securities intermediary (the "Securities
Intermediary"), as amended and supplemented by the Series Supplement, dated as
of the date hereof, between the Depositor and the Trustee and Securities
Intermediary (the Standard Terms, together with the Series Supplement, the
"Trust Agreement"). Capitalized terms used but not defined herein shall have the
meanings ascribed to them in the Trust Agreement. This Agreement shall
constitute the "Market Agent Agreement" as defined in the Trust Agreement.
W I T N E S S E T H:
WHEREAS, the Trust desires to retain Xxxxxxx Xxxxx & Co. to render
certain services to the Trust in the manner and on the terms hereinafter set
forth;
WHEREAS, Xxxxxxx Xxxxx & Co. is a recognized broker dealer meeting the
qualifications for a Market Agent set forth in the Trust Agreement and desires
to provide such services to the Trust on the terms and conditions hereinafter
set forth; and
WHEREAS, the Trustee has been directed to enter into and execute this
Market Agent Agreement with Xxxxxxx Xxxxx & Co. as the initial Market Agent
pursuant to Section 8.01 of the Standard Terms;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained, Xxxxxxx Xxxxx & Co. and the Trust hereby agree as
follows:
Section 1. Duties of the Market Agent. The Trust hereby employs
Xxxxxxx Xxxxx & Co. to act as the Market Agent for the Trust and to furnish to
the Trust all of the services of the Market Agent set forth herein and in the
Trust Agreement, including but not limited to acting on behalf of the Trust in
connection with the sale and purchase of Underlying Securities as provided in
the Trust Agreement. The Market Agent may solicit and accept bids from
Certificateholders for the Underlying Securities. Xxxxxxx Xxxxx & Co. hereby
accepts such employment and agrees during the term of the Certificates to render
such services and to assume the obligations of the Market Agent under the Trust
Agreement under the terms and conditions herein set forth.
Section 2. Compensation of Xxxxxxx Xxxxx & Co. The Depositor shall pay
Xxxxxxx Xxxxx & Co. a fee as shall be separately agreed between the Depositor
and Xxxxxxx Xxxxx & Co. It shall be the sole responsibility of the Depositor to
pay such fee and the Trust shall have no obligation to compensate Xxxxxxx Xxxxx
& Co. for the services it renders pursuant to the terms of this Market Agent
Agreement, except that the Trust shall pay Xxxxxxx Xxxxx & Co. a fee for any
sale of the Underlying Securities in an amount that is customary for such a sale
at the time of such sale.
Section 3. Limitation of Liability of the Market Agent. The Market
Agent shall not be liable in contract, tort or otherwise to the Trust for any
losses, costs or damages arising out of its performance of its obligations and
duties hereunder except for willful misconduct or negligence in the performance
of its duties, or by reason of reckless disregard of its obligations and duties
hereunder.
Section 4. Term of this Agreement. This Agreement, which shall be a
binding agreement as of the date hereof and shall inure to the benefit of the
respective successors and permitted assigns of the parties hereto, shall
terminate upon the earlier to occur of (a) the termination of the Trust
Agreement, (b) the removal of the Market Agent by the Trustee in accordance with
the Trust Agreement or (c) 30 days after written notice of Xxxxxxx Xxxxx & Co.'s
resignation as Market Agent is delivered to the Trustee.
Section 5. Amendments. No amendment or waiver of any provision of this
Agreement nor consent to any departure herefrom by any party hereto shall in any
event be effective unless the same shall be in writing and signed by the party
against which enforcement of such amendment or waiver or consent is sought, and
then such waiver or consent shall be effective only in the specific instance and
for the specific purpose for which it is given.
Section 6. Notice Addresses. Except as otherwise expressly provided
herein, all notices and other communications provided for hereunder shall be
deemed to have been duly given if sent by facsimile transmission (a) if to the
Market Agent, as set forth below and (b) if to the Trustee, as set forth in the
Trust Agreement;
If to Xxxxxxx Xxxxx & Co.: Xxxxxxx Xxxxx & Co.
4 World Financial Center
North Tower, 7th Floor
New York, NY 10080
Attention: Xxxxxxx X. Xxxxxx
Xxxxxxxxx: (000) 000-0000
Telephone confirmation: (000) 000-0000
Section 7. Assignment. Except as provided in this Section 7, this
Agreement may not be assigned by the Market Agent without the prior consent of
the Trustee in accordance with the Trust Agreement.
The Market Agent shall have the right to transfer and assign all of
its rights, duties, obligations and liabilities under this Agreement to an
Affiliate of the Market Agent; provided, however, that such transfer and
assignment shall be on the condition that the due and punctual performance and
observance of all the terms and conditions of this Agreement to be performed by
the Market Agent shall, by an agreement supplemental hereto, be assumed by such
Affiliate just as fully and effectually as if such Affiliate had been the
original party of the first part to this Agreement.
2
Section 8. Applicable Law. This Agreement shall be governed by the
laws of the State of New York.
Section 9. Entire Agreement. This Agreement embodies the entire
agreement and understanding between Xxxxxxx Xxxxx & Co. and the Trust and
supersedes any and all prior agreements and understandings between Xxxxxxx Xxxxx
& Co. and the Trust relating to the subject matter hereof.
Section 10. Counterparts. This Agreement may be signed in any number
of counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
Section 11. Severability of Provisions. If one or more of the
provisions of this Agreement shall be for any reason whatsoever held invalid or
unenforceable, such provisions shall be deemed severable from the remaining
covenants, agreements and provisions of this Agreement and such invalidity or
unenforceability shall in no way affect the validity or enforceability of such
remaining provisions or the rights of any parties thereunder. To the extent
permitted by law, the parties hereto hereby waive any provision of law that
renders any provision of this Agreement invalid or unenforceable in any respect.
Section 12. Nonpetition Covenant. Notwithstanding any prior
termination of this Agreement, Xxxxxxx Xxxxx & Co. agrees that it shall not,
until the date which is one year and one day after the termination of the PPLUS
Trust Series CMT-1 pursuant to the terms of Section 13 of the Series Supplement,
acquiesce, petition or otherwise invoke or cause the Trust to invoke the process
of the United States, any State or other political subdivision thereof or any
entity exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government for the purpose of commencing or
sustaining a case by or against the Trust under a Federal or state bankruptcy,
insolvency or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Trust or all
or any part of the property or assets of the Trust or ordering the winding up or
liquidation of the affairs of the Trust.
Section 13. No Recourse. Xxxxxxx Xxxxx & Co. shall have no recourse to
the Underlying Securities with respect to any fees owed to Xxxxxxx Xxxxx & Co.
under Section 2 of this agreement. This Section 13 shall not be read as limiting
any right Xxxxxxx Xxxxx & Co. may have to the Underlying Securities pursuant to
any security, call right or other instrument, obligation or agreement the Trust
may issue or enter into from time to time.
3
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Market Agent Agreement as of the day and year first above written.
XXXXXXX XXXXX & CO.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Authorized Signatory
PPLUS TRUST SERIES CMT-1
By: THE BANK OF NEW YORK, solely in its capacity as
Trustee under the Trust Agreement and not in its
individual capacity
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Authorized Signatory
[MARKET AGREEMENT SIGNATURE PAGE]
EXHIBIT E
FORM OF
ESCROW DEPOSIT AGREEMENT
THIS ESCROW DEPOSIT AGREEMENT, dated as of this __ day of_____ among
PPLUS Trust Series CMT-1 (the "Trust"), by The Bank of New York, a New York
corporation, as Trustee of the Trust ("Trustee"), [ ], a [ ] corporation,
as Escrow Agent ("Escrow Agent"), and [ ], a [ ] corporation ("Holder").
W I T N E S S E T H:
WHEREAS, the Trustee and Xxxxxxx Xxxxx Depositor, Inc. ( "Depositor")
entered into a Standard Terms for Trust Agreement dated February 20, 1998 (the
"Standard Terms"), as supplemented by a Series Supplement dated April 16, 2004
(the "Series Supplement," and, together with the Standard Terms, the "Trust
Agreement"), providing for the issuance by the Trust of PPLUS Class A 6.25%
Trust Certificates Series CMT-1 and PPLUS Class B0.80% Trust Certificates Series
CMT-1 (collectively, the "Trust Certificates") and delivery of related call
warrants on the Trust Certificates (each a "Warrant," and collectively, the
"Warrants") as described in the Warrant Agreement dated April 16, 2004 (the
"Warrant Agreement") among the Trust and The Bank of New York, as Warrant Agent
(the "Warrant Agent"); and
WHEREAS, the Holder is [one of the holders] [the holder] of the
Warrants; and
WHEREAS, it is a condition precedent to the exercise of the Warrants
that the Holder enter into this Agreement and deliver the Escrow Deposit (as
defined herein) to the Escrow Agent not less than 30 days (or not less than
three days in the case of the announcement of any redemption or other
unscheduled payment of the Underlying Securities or receipt of notice of
termination of the Trust or when a tender offer for the Underlying Securities is
pending not less than five days prior to the expiration of the tender offer
acceptance period) but not more than 60 days prior to the Exercise Date (as
defined in the Warrant Agreement); and
WHEREAS, the parties desire that Escrow Agent shall hold, and Escrow
Agent has agreed to hold, the Escrow Deposit in escrow on the terms and
conditions provided in this Agreement.
NOW THEREFORE, the parties hereto mutually agree as follows:
1. Escrow Deposit. Concurrently with the execution and delivery of
this Agreement, the Holder will deliver [the sum of ____________________ Dollars
($_____________) in lawful money of the United States of America by wire
transfer of immediately available funds] [and] [[ ] Class A Trust
Certificates] [and] [[ ] Class B Trust Certificates] in accordance with
Section 14 of the Series Supplement] (the "Escrow Deposit"), to Escrow Agent to
be held by Escrow Agent in escrow on the terms and conditions hereinafter
provided. Escrow Agent hereby acknowledges receipt of the Escrow Deposit. Any
cash amounts in the Escrow Deposit may be increased or decreased in accordance
with the terms of Section 2.02(i)(vi) of the Warrant Agreement and the terms of
this agreement
will apply with equal force and effect to any such increased or decreased cash
amounts in the Escrow Deposit.
2. Investment of Escrow Deposit. Following the delivery of the Escrow
Deposit to Escrow Agent, Escrow Agent shall cause any cash in the Escrow Deposit
to be deposited in an interest bearing account, designated as the "PPLUS Trust
Series CMT-1 Warrant Escrow Account," and shall advise the Trust by telephone by
5:00 p.m., New York City time, on the date hereof of the amount so deposited in
its account. The Escrow Agent will promptly confirm such telephone advice in
writing to the Trust. The Escrow Agent is hereby directed to invest any cash in
the Escrow Deposit in (i) U.S. Treasury Securities or (ii) money market accounts
in banks having combined capital, surplus and undivided profits of $50,000,000
or more. All investments shall [have a maturity of ________ days or less during
the _______ days immediately after deposit of the Escrow Deposit, and thereafter
shall] be available on demand without penalty unless Escrow Agent is otherwise
directed in writing by both the Holder and the Trust.
3. Disposition of Escrow Deposit Prior to and at Closing.
(a) On the Exercise Date, simultaneously with the transfer of Trust
Certificates to the Holder that were subject to the Holder's Warrants (including
any such Trust Certificates deposited as set forth in paragraph 1), except where
the Exercise Date is a deemed Exercise Date pursuant to Section 2.02(i)(iv) of
the Warrant Agreement, in which case no such transfer will occur, (the
"Closing," the period of time between the initial deposit of the Escrow Deposit
and the Closing being referred to as the "Escrow Period") in accordance with the
terms of the Warrant Agreement (i) the Escrow Agent shall pay to the Holder all
interest, and interest earned on interest, on any cash in the Escrow Deposit to
the Closing Date in lawful money of the United States of America by wire
transfer of immediately available funds to a bank account or bank accounts
designated by the Holder or, at the Holder's option, by a bank check or bank
checks payable to the order of a payee or payees designated by the Holder, (ii)
the Escrow Agent shall pay any cash amounts in the Escrow Deposit in lawful
money of the United States of America by wire transfer of immediately available
funds to a single bank account or bank accounts designated by the Warrant Agent,
or, at the Warrant Agent's option, by a bank check or bank checks payable to the
order of a payee or payees designated by the Warrant Agent and (iii) the Escrow
Agent shall deliver any Trust Certificates in the Escrow Deposit to the Warrant
Agent.
(b) If, during the Escrow Period, the Trust Agreement is terminated in
accordance with Section 10 of the Standard Terms and Section 13 of the Series
Supplement, then Escrow Agent shall, ten (10) business days after written notice
by Trust and the Holder of such termination, (i) return any Trust Certificates
in the Escrow Deposit to the Holder and (ii) pay to the Holder any cash in the
Escrow Deposit, plus all interest, and interest earned on interest, on such
cash, in lawful money of the United States of America by wire transfer of
immediately available funds to a bank account or bank accounts designated by the
Holder or, at the Holder's option, by a bank check or bank checks payable to the
order of a payee or payees designated by the Holder; provided, however, that if
the Escrow Agent receives a written objection from the Trust to such release of
such cash in the Escrow Deposit within seven (7) business days after the Holder
gives such written notice, then the Escrow Agent shall pay the cash amount in
the
2
Escrow Deposit and any interest, and interest earned on interest, on such
amounts in accordance with joint written instructions from the Holder and the
Trust, or, in the absence of such joint written instructions, the provisions of
Section 6 hereof shall apply.
4. Liability of Escrow Agent. The Escrow Agent shall not incur any
liability to any party for damages, losses or expenses for (a) any act or
failure to act made or omitted in good faith and without gross negligence or
willful misconduct or (b) any action taken or omitted in reliance upon any
instrument that the Escrow Agent shall in good faith believe to be genuine, nor
will the Escrow Agent be liable or responsible for forgeries, fraud,
impersonations, or determining the scope of any representative authority. In
addition, the Escrow Agent may consult with legal counsel in connection with the
Escrow Agent's duties under this Agreement and shall be fully protected in any
act taken, suffered, or permitted by it in good faith in accordance with the
advice of counsel. The Escrow Agent is not responsible for determining and
verifying the authority of any person acting or purporting to act on behalf of
any party to this Agreement.
5. Escrow. The Escrow Agent can incur reasonable expenses in
connection with its duties and incur legal fees and expenses in connection with
this Agreement with any firm, and such expenses shall be paid or reimbursed, as
the case may be, in accordance with Section 7 of this Agreement. In the event
that the conditions of this Agreement are not properly fulfilled, or if the
Escrow Agent renders any service not provided for in this Agreement, or if the
parties request a substantial modification of its terms, or if any controversy
arises, or if the Escrow Agent is made a party to, or intervenes in, any
litigation pertaining to this escrow or its subject matter, the Escrow Agent
shall be reasonably compensated for such extraordinary service and reimbursed
for all reasonable costs, attorneys' fees and expenses of any firm occasioned by
such default, delay, controversy or litigation and the Escrow Agent shall have
the right to retain all documents and/or other things of value at any time held
by Escrow Agent in this escrow until such compensation, fees, costs, and
expenses are paid.
6. Controversies. If any controversy arises relating to this
Agreement, or with any other party concerning the subject matter of this
Agreement, its terms or conditions, the Escrow Agent will not be required to
determine the controversy or to take any action regarding it. The Escrow Agent
may hold the Escrow Funds (as hereinafter defined) and may wait for settlement
of any such controversy by final appropriate legal proceedings or other means,
as, in the Escrow Agent's discretion, the Escrow Agent may deem appropriate
despite what may be set forth elsewhere in this Agreement. In such event, the
Escrow Agent will not be liable for damages as long as the Escrow Agent acts in
good faith and without gross negligence or willful misconduct. The Escrow Agent
is authorized to deposit with the clerk of any court the Escrow Funds held
hereunder. Upon initiating an interpleader or declaratory judgment or any other
action seeking to determine the rights of the parties hereunder and depositing
the Escrow Funds, the Escrow Agent shall be fully released and discharged of and
from all further obligations and liability imposed by the terms of this
Agreement, but not as to acts of the Escrow Agent prior thereto. As used herein,
the term "Escrow Funds" means the Escrow Deposit plus all interest, and interest
earned on interest, on the Escrow Deposit.
7. Indemnification of Escrow Agent. The Holder and its successors and
assigns agrees to indemnify and hold Xxxxxx Agent harmless against any and all
losses, claims,
3
damages, liabilities and expenses, including reasonable costs of investigation
and reasonable counsel fees and disbursements, that may be imposed on the Escrow
Agent or incurred by the Escrow Agent in good faith and without gross negligence
or willful misconduct in connection with the performance of the duties under
this Agreement, including, but not limited to, any litigation arising from this
Agreement or involving its subject matter.
8. Termination. Except for the provisions of Section 7, which shall
survive this Agreement, this Agreement shall terminate upon the day on which all
of the Escrow Funds are disbursed in full in accordance with this Agreement.
9. Mailing Instructions, Etc. Instructions and other documents
delivered under this Agreement shall be valid if (i) hand-delivered, (ii) sent
by registered or certified mail, return receipt requested, (iii) sent by Federal
Express or other reliable overnight courier service, or (iv) transmitted by
telecopy.
(a) If to the Holder at:
-------------------------
-------------------------
-------------------------
Attn: ------------------
Telecopy ( )
Telephone ( )
(b) If to the Trust, at:
PPLUS Trust Series CMT-1
c/o The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 0X
Xxx Xxxx, XX 00000
Attn: Corporate Trust Dealing & Trading Group
PPLUS Trust Series CMT-1
Facsimile (000) 000-0000
Telephone (000) 000-0000
(c) If to the Escrow Agent, at:
-------------------------
-------------------------
-------------------------
Attn: ------------------
Telecopy ( )
Telephone ( )
Each notice, demand, instruction or communication which shall be given or made
in the manner described above shall be deemed sufficiently given or made at such
time as it is delivered to the addressee in the case of personal delivery or
registered or certified mail, one (1) business day following delivery to the
courier if sent by Federal Express or other reliable overnight courier or
4
upon receipt of the telecopy if sent by telecopy, followed by a written
confirmation within two (2) business days.
10. Trust Agreement; Defined Terms. Defined terms used herein shall
have the respective meanings set forth in the Trust Agreement unless otherwise
defined herein.
11. Binding. This Agreement shall be binding upon, inure to the
benefit of, and be enforceable by the parties hereto and their respective
successors and assigns.
12. Governing Law. This Agreement shall be deemed a contract made
under the laws of the State of New York, and together with the rights and
obligations of the parties hereunder, shall be construed and enforced in
accordance with and governed by the laws of such state (but not including the
choice-of-law rules thereof).
13. Counterparts. This Agreement may be executed simultaneously in
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
14. Captions. Any captions are solely for convenience of reference and
shall not be used in construing or interpreting this Agreement.
15. Entire Agreement. This Agreement sets forth the entire agreement
among the parties with respect to the subject matter hereof and supersedes all
prior or oral agreements or understandings with respect thereto.
16. Nonpetition Covenant. Notwithstanding any prior termination of
this Agreement, the Escrow Agent agrees that it shall not, until the date which
is one year and one day after the termination of the PPLUS Trust Series CMT-1
pursuant to the terms of Section 13 of the Series Supplement, acquiesce,
petition or otherwise invoke or cause the Trust to invoke the process of the
United States, any State or other political subdivision thereof or any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government for the purpose of commencing or
sustaining a case by or against the Trust under a Federal or state bankruptcy,
insolvency or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Trust or all
or any part of the property or assets of the Trust or ordering the winding up or
liquidation of the affairs of the Trust.
17. No Recourse. The Escrow Agent shall have no recourse to the
Underlying Securities with respect to any fees owed to the Escrow Agent under
Section 7 of this agreement. This Section 17 shall not be read as limiting any
right the Escrow Agent may have to the Underlying Securities pursuant to any
security, call right or other instrument, obligation or agreement the Trust may
issue or enter into from time to time.
5
IN WITNESS WHEREOF, the parties hereto have executed this Escrow
Agreement as of the day and year first above written.
PPLUS Trust Series CMT-1
By: THE BANK OF NEW YORK, solely in its
capacity as Trustee under the Trust
Agreement and not in its individual
capacity
By:
-----------------------------------
Name:
Title:
, as Escrow Agent
-----------------
By:
-----------------------------------
Name:
Title:
, as Holder
-----------------
By:
-----------------------------------
Name:
Title:
