EXHIBIT 4
PPLUS TRUST CERTIFICATES SERIES GSG-1
SERIES SUPPLEMENT
between
XXXXXXX XXXXX DEPOSITOR, INC.,
as Depositor,
and
THE BANK OF NEW YORK,
as Trustee and Securities Intermediary
Dated as of February 25, 2003
SERIES SUPPLEMENT, dated as of February 25, 2003 (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.
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"Authorized Denomination": With respect to Certificates, an aggregate
stated and/or notional principal amount of $1,000, as applicable.
"Business Day": Any day that is not a Saturday, a Sunday or a legal holiday
or a day on which banking institutions or trust companies in the City of New
York are authorized or obligated by law, regulation or executive order to close
and that also is specified as a Business Day with respect to the Underlying
Securities.
"Call Date": Any Business Day that (i) a Call Holder designates as a Call
Date on or after February 15, 2008; (ii) a Call Holder designates as a Call Date
before February 15, 2008 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 3,600,000 Class A Certificates and all 3,600,000 Class
B Certificates.
"Class A Allocation": The present value (discounted at the rate of 6.125%
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.
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"Class A Certificate Account": The Certificate Account established for the
Class A Certificateholders.
"Class A Certificates": The Certificates issued by the Trust in a stated
amount of $25 per trust certificate, entitled to receive on each Distribution
Date until and including the Final Scheduled Distribution Date, distributions at
a rate of 6.00% per annum on the stated amount of the Class A Certificates and a
cash distribution of the principal amount of the Underlying Securities on the
Final Scheduled Distribution Date and such other distributions as described
herein.
"Class B Allocation": The sum of the present values (discounted at the rate
of 6.125% per annum) of the Class B Payments (assuming, for purposes hereof,
that the Underlying Securities are paid in full on their stated maturity date,
and no portion thereof is accelerated or redeemed prior to such date).
"Class B Call Price" means the sum of the present values, discounted at a
rate of 6.125% 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 August 15, 2003 and ending
on the Final Scheduled Distribution Date, a distribution of 0.125% 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": February 25, 2003.
"Collection Period": (i) With respect to each August 15 Distribution Date,
the period beginning on the day after the February 15 Distribution Date of the
current year and ending on such August 15 Distribution Date, inclusive, and (ii)
with respect to each February 15 Distribution Date, the period beginning on the
day after the August 15 Distribution Date of the prior year and ending on such
February 15 Distribution Date, inclusive, except for the August 15, 2003
Distribution Date, as to which the Collection Period shall be the period
beginning on the
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Cut-off Date and ending on such August 15, 2003 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 Xxxxxx
Xxxxxx, 0xx Xxxxx, 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 Xxxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, XX
00000.
"Cut-off Date": February 25, 2003
"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": February 15 and August 15 of each year (or if such
date is not a Business Day, the next succeeding Business Day), commencing on
August 15, 2003 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
6.125% per year, of the unpaid payments due, or to become due, in respect
of the Class B Payments to be made on the Class B Certificates on or after
the date of payment (assuming, for purposes of such calculation, that the
Underlying Securities would have been paid in full at their stated
maturity, that such acceleration had not occurred, and that no portion
thereof would have been redeemed prior to such maturity date) then all
holders of outstanding Call Rights will be deemed to have exercised their
Call Rights automatically, and the Trustee, upon receiving such
acceleration proceeds from the Underlying Securities Issuer, shall, on the
first Business
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Day following receipt of such acceleration proceeds, distribute from such
acceleration proceeds the following amounts:
(A) the Class A Call Price or the Class B Call Price per
Certificate, as applicable, shall be distributed from such payment on
account of each Certificate called from the holder thereof (which
holders, pursuant to Section 2.02(d) of the Warrant Agreement, shall
exclude Certificateholders to whom Delivery Certificates (as defined
in the Warrant Agreement) were delivered in accordance with Section
2.02(d) of the Warrant Agreement),
(B) for each Class A Certificate, $25.00 plus any accrued and
unpaid interest on such Class A Certificate to that date of payment,
or, for each Class B Certificate, the sum of the present values,
discounted at the rate of 6.125% per annum, of the unpaid
distributions that were due, or to become due, in respect of the Class
B Payments to be made on such Class B Certificate on or after the date
of payment (assuming, for purposes of such calculation, that the
Underlying Securities would have been paid in full on their stated
maturity, and that such acceleration had not occurred, and that no
portion thereof would have been redeemed prior to such stated maturity
date), as applicable, shall be distributed from such payment on
account of each Certificate held by Certificateholders to whom
Delivery Certificates were delivered in accordance with Section
2.02(d) of the Warrant Agreement, and
(C) any amounts remaining shall be divided between the Classes in
accordance with the Allocation Ratio and each Class' portion shall be
distributed pro rata among the Call Holders that are deemed to have
exercised their Call Rights automatically pursuant to this clause with
respect to that Class and the Certificateholders of that Class to whom
Delivery Certificates were delivered in accordance with Section
2.02(d) of the Warrant Agreement;
If the payment to be made by the Underlying Securities Issuer
does not exceed the threshold set forth above, the Trustee shall
divide the amount of such payment between the Trust Certificate
Classes in accordance with the Allocation Ratio and distribute each
Class's portion of such amounts pro rata to the Trust
Certificateholders of that Class.
(ii) makes a partial payment of all amounts when due, then the
Trustee, upon receiving such payment, shall:
(A) immediately divide such payment between the Classes in
accordance with the Allocation Ratio and deposit each Class' portion
of such payment into that Class' Certificate Account for distribution
to such Class' Certificateholders pro rata on the first Business Day
following such deposit into such Certificate Account; provided, that
if the Underlying Securities Issuer places any condition, restriction
or obligation on the acceptance of such partial payment including but
not limited to a waiver of any right granted to a holder of the
Underlying
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Securities, such partial payment will be rejected by the Trustee and
no deposit will be made into the Certificate Account,
(B) divide a principal amount of the Underlying Securities equal
to the aggregate stated amount of the outstanding Class A Certificates
between the Classes in accordance with the Allocation Ratio and
distribute each Class' portion of the Underlying Securities to such
Class' Certificateholders pro rata and divide a pro rata portion of
the Related Assets between the Classes in accordance with the
Allocation Ratio and distribute each Class' portion of such Related
Assets to such Class' Certificateholders pro rata to each
Certificateholder's last address as it appears in the Certificate
Register within three Business Days of receiving said notice, and
(C) if any Underlying Securities are not distributed pursuant to
clause (B), immediately direct the Market Agent to sell all Underlying
Securities not so distributed and a pro rata portion of the Related
Assets held by the Trust, in accordance with the Sale Procedures, and
the Liquidation Proceeds, if any, shall be divided between the Classes
in accordance with the Allocation Ratio and each Class' portion shall
be deposited into such Class' Certificate Account and distributed to
such Class' Certificateholders pro rata on the first Business Day
following such deposit into such Certificate Account; or
(iii) fails to make such payment when due, then the Trustee, upon
receiving notice of such failure to make payment, shall:
(A) divide a principal amount of Underlying Securities equal to
the aggregate stated amount of the outstanding Class A Certificates
and a pro rata portion of the Related Assets in accordance with the
Allocation Ratio between the Classes in accordance with the Allocation
Ratio and distribute each Class' portion to such Class'
Certificateholders pro rata to each Certificateholder's last address
as it appears in the Certificate Register within three Business Days
of receiving said notice, and
(B) if any Underlying Securities are not distributed pursuant to
clause (A), immediately direct the Market Agent to sell all Underlying
Securities not so distributed and a pro rata portion of the Related
Assets held by the Trust, in accordance with the Sale Procedures, and
the Liquidation Proceeds, if any, shall be divided between the Classes
in accordance with the Allocation Ratio and each Class' portion shall
be deposited into such Class' Certificate Account and distributed to
such Class' Certificateholders pro rata on the first Business Day
following such deposit into such Certificate Account.
(c) If the Underlying Securities Issuer of any Concentrated Underlying
Securities ceases to be a reporting company under the Exchange Act, and no
parent guarantor of such Underlying Securities Issuer, if any, includes in its
Exchange Act reports condensed consolidating financial statements setting forth
financial information for the Underlying Securities Issuer, then the Trustee,
upon receiving notice of such event shall (A) divide a
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principal amount of Underlying Securities equal to the aggregate stated amount
of the outstanding Class A Certificates and a pro rata portion of the Related
Assets in accordance with the Allocation Ratio between the Classes in accordance
with the Allocation Ratio and distribute each Class' portion to such Class'
Certificateholders pro rata to each Certificateholder's last address as it
appears in the Certificate Register within three Business Days of receiving said
notice, and (B) if any Underlying Securities are not distributed pursuant to
clause (A), immediately direct the Market Agent to sell all Underlying
Securities not so distributed and a pro rata portion of the Related Assets held
by the Trust, in accordance with the Sale Procedures, and the Liquidation
Proceeds, if any, shall be divided between the Classes in accordance with the
Allocation Ratio and each Class' portion shall be deposited into such Class'
Certificate Account and distributed to such Class' Certificateholders pro rata
on the first Business Day following such deposit into such Certificate Account.
(d) Upon receiving (A) notice of an acceleration of the date of maturity of
the Underlying Securities and the Underlying Securities Issuer's partial payment
of all amounts when due as described in subsection (ii) of clause (b) above, or
(B) notice of the events set forth in clause (c) above, the Trustee shall, 10
days prior to the exercise of any remedy, provide written notice of the
termination of the Trust to the Call Holders. Notwithstanding subsection (ii) of
clause (b) and clause (c), the Trustee shall not distribute any such partial
payment, Underlying Securities or Related Assets to any Certificateholders
before the earlier of (i) the expiration of the 10-day notice of termination
period, and (ii) receipt by the Trust of notice of all Call Holders' election to
exercise their Class A Call Right or Class B Call Right, as applicable. If less
than all outstanding Class A Call Rights or Class B Call Rights are exercised,
upon receiving such notice of election, the Trustee shall select by lot (or by
such other reasonable procedure as may be established by the Trustee) for
purchase by such exercising Call Holders in the case of Class A Certificates the
stated amount of Class A Certificates equal to the stated amount of Class A Call
Rights being exercised multiplied by the aggregate stated amount of the
outstanding Class A Certificates not subject to Delivery Certificates divided by
the aggregate stated amount of the outstanding Class A Call Rights or, in the
case of Class B Certificates, the aggregate notional principal amount of Class B
Certificates equal to the aggregate notional principal amount of Class B Call
Rights being exercised multiplied by the aggregate notional principal amount of
the outstanding Class B Certificates not subject to Delivery Certificates
divided by the aggregate notional principal amount of the outstanding Class B
Call Rights. The Certificateholders of the Trust Certificates to be purchased
shall not be entitled to any right other than the right to receive payment of an
amount equal to the applicable Call Price on the date the applicable Call Rights
are exercised, and such Trust Certificates shall be deemed to have been
automatically surrendered by the Certificateholders to the Trust for further
transfer to the exercising Call Holders. The share of the payment, Underlying
Securities and Related Assets to be distributed with respect to such called
Trust Certificates shall be distributed to the exercising Call Holders. In the
case of a sale by the Market Agent of Underlying Securities and Related Assets
pursuant to clause (a) above, the Trustee shall deliver such Underlying
Securities and Related Assets to the purchaser of such Underlying Securities and
Related Assets only against payment in same day funds and the Trustee shall
deposit the same into the Certificate Account.
"Eligible Investments": As defined in the Standard Terms; provided,
however, that (i) the minimum required rating for long-term instruments will be
equal to the lower of the rating of the Underlying Securities or the Trust
Certificates, and (ii) the rating of any short-term
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instruments will be A-1+ by S&P and P1 by Xxxxx'x; and provided, further, that
any such investment matures no later than the Business Day prior to the next
succeeding Distribution Date.
"Escrow Agent": As will be set forth in the Escrow Agreement.
"Escrow Agreement": The escrow agreement to be entered into on the Exercise
Date among a given Call Holder, the Trustee and the Escrow Agent pursuant to
Section 14(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": February 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, 6.00%
per annum and with respect to the Class B Certificates, 0.125% 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
(payable in semi-annual installments of $1,000).
"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 February 20, 2003
relating to the Class A Certificates and the Prospectus Supplement dated
February 20, 2003 relating to the Class B Certificates.
"Rating Agency": Xxxxx'x and S&P.
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"Record Date": The Business Day immediately preceding each Distribution
Date.
"Series": PPLUS Trust Series GSG-1.
"Underlying Securities": The $90,000,000 aggregate principal amount of
6.125% Notes due February 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": The Xxxxxxx Xxxxx Group, Inc., a Delaware
corporation.
"Underlying Securities Prospectus Supplement": The prospectus supplement
dated February 6, 2003 and amended on February 10, 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 February 25, 2003,
by and between the Trust and the Warrant Agent (as defined in the Warrant
Agreement).
(b) The terms listed below are not applicable to this Series.
"Accounting Date"
"Administration Account"
"Administrative Agent"
"Administration Agreement"
"Administrative Agent Termination Event"
"Advance"
"Calculation Agent"
"Eligible Expense"
"Exchange Rate Agent"
"Floating Pass-Through Rate"
"Letter of Credit"
"Limited Guarantor"
"Limited Guaranty"
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"Notional Amount"
"Reserve Account"
"Requisite Reserve Amount"
"Retained Interest"
"Surety Bond"
"Swap Agreement"
"Swap Counterparty"
"Swap Distribution Amount"
"Swap Guarantee"
"Swap Guarantor"
"Swap Receipt Amount"
"Swap Termination Payment"
Section 3. Designation of Trust and Certificates. (a) The Trust created
hereby shall be known as the "PPLUS Trust Series GSG-1". The Class A
Certificates and Class B Certificates evidencing certain undivided ownership
interests therein shall be known as the "PPLUS Class A 6.00% Trust Certificates
Series GSG-1" and the "PPLUS Class B 0.125% Trust Certificates Series GSG-1,"
respectively.
(b) The Class A Certificates and Class B Certificates shall be held through
the Depository in book-entry form and shall be substantially in the form
attached hereto as Exhibits B and C, respectively. The Class A Certificates
shall be issued in authorized denominations of $25 and integral multiples
thereof and the Class B Certificates shall be issued with a notional principal
amount of $25 and integral multiples thereof. Except as provided in the Standard
Terms, the Trust shall not issue additional Certificates or incur any
indebtedness; 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 August 15, 2003 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 6.00% per annum on the stated amount of the Class A
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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 0.125% 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 6.00% per annum on the stated amount of the Class A
Certificates to holders of the Class A Certificates on such Distribution
Date and 0.125% 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 August 15, 2003 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., 6.00/6.125 to the Class A
Certificateholders and 0.125/6.125 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;
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(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
13
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:
(iii) 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;
(iv) 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;
(v) such exchange will not affect the characterization of the Trust as
a "grantor trust" under the Code;
(vi) 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;
(vii) 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
(viii) 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, 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
14
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.
15
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.
16
(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 10281
Attention: Xxxxx X. Xxxxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
17
If to the Trustee, to:
The Bank of New York
Corporate Trust Department
000 Xxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attention: PPLUS Trust Series GSG-1
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Securities Intermediary, to:
The Bank of New York
Corporate Trust Department
000 Xxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attention: PPLUS Trust Series GSG-1
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Warrant Agent, to
The Bank of New York
Corporate Trust Department
000 Xxxxxx Xxxxxx, 0xx Xxxxx,
Xxx Xxxx, XX 00000
Attention: PPLUS Trust Series GSG-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
00 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Structured Finance Surveillance Group
Telephone: (000) 000-0000
18
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
19
distribute the Redemption Amount first, pro rata to the Class A
Certificateholders until each shall have received the stated amount of each
Class A Certificate it holds plus accrued and unpaid distributions on the Class
A Certificates to the Redemption Date; second, pro rata to the Class B
Certificateholders until each shall have received the sum of the present values
(discounted at the rate of 6.125% 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 6.00/6.125 of such amount to the Class A Certificateholders
and 0.125/6.125 of such amount to the Class B Certificateholders, and within
each class the Redemption Amount will be distributed pro rata to the
Certificateholders of the Class A or Class B Certificates entitled to such
Redemption Amount upon the date such Redemption Amount is received in
immediately available funds by the Trust if such Redemption Amount is received
prior to 1:00 p.m. local time at the office of the Trustee and otherwise on the
next Business Day. (ii) Upon any redemption of the Underlying Securities in part
at the option of the Underlying Securities Issuer upon at least 30 days, but not
more than 60 days, prior notice pursuant to the Underlying Securities Indenture,
the Redemption Amount will be distributed pro rata to the holders of the
Underlying Securities, including the Trust. Upon any such redemption in part,
the Trustee shall select by lot (or by such other reasonable procedure as may be
established by the Trustee) a stated amount of Class A Certificates and an equal
notional principal amount of Class B Certificates equal to the aggregate amount
of each Class of Certificates then outstanding multiplied by the aggregate
principal amount of Underlying Securities subject to redemption and then held by
the Trust divided by the aggregate principal amount of Underlying Securities
then held by the Trust; provided that the amount of each Class of Trust
Certificates being selected by lot may be reduced by the aggregate stated amount
of Class A Certificates or notional principal amount of Class B Certificates, as
applicable, called pursuant to the exercise of Call Rights prior to such
redemption in accordance with the terms of the Warrant Agreement. Upon receiving
such Redemption Amount, the Trust shall distribute the Redemption Amount, first,
pro rata to the Class A Certificateholders selected by lot pursuant to this
subsection until each shall have received the stated amount of each Class A
Certificate it holds plus accrued and unpaid distributions on the Class A
Certificates to the Redemption Date; second, pro rata to the Class B
Certificateholders selected by lot pursuant to this subsection until each shall
have received the sum of the present values (discounted at the rate of 6.125%
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 6.00/6.125 of
such amount to the Class A Certificateholders and 0.125/6.125 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
20
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
21
holds Class A Certificates or Class B Certificates that are subject to
Call Rights, the Call Holder may deposit such Class A Certificates or
Class B Certificates with the Escrow Agent in lieu of the portion of
the Call Price that would relate thereto, and (b) if less than all of
the outstanding Class B Trust Certificates are to be purchased
pursuant to the exercise of the Warrants on an Exercise Date and the
exercising Call Holder at such time holds Class B Certificates that
are subject to Call Rights, the Call Holder may deposit such Class B
Certificates with the Escrow Agent in lieu of the portion of the Call
Price that would relate thereto.
(3) provide the Trustee with any other documents customary for a
transaction of this nature, including a certificate of the Call Holder
certifying the solvency of such Call Holder on such date; provided
that the Call Holder need not provide any such solvency certificate if
the rating of the senior, unsecured long-term debt of the Call Holder,
or the Call Holder's credit support provider, if applicable, by
Moody's and S&P is in one of the investment grade categories of
Xxxxx'x and S&P, respectively, on such date.
The provisions of this Section 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.
22
(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
23
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
24
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 GSG-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"
25
(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."
26
IN WITNESS WHEREOF, the parties hereto have caused this Supplement to be
duly executed by their respective authorized officers as of the date first
written above.
Xxxxxxx Xxxxx Depositor, Inc.,
as Depositor
By:
-----------------------------
Name: Xxxxx X. Xxxxxxxxxxx
Title: President
The Bank of New York,
not in its individual capacity
but as Trustee
By:
-----------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Authorized Signatory
The Bank of New York,
as Securities Intermediary
By:
-----------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Authorized Signatory
27
SCHEDULE I
PPLUS TRUST CERTIFICATES, SERIES GSG-1
UNDERLYING SECURITIES SCHEDULE
Underlying Securities: $90,000,000 6.125% Notes (principal amount $1,000
per security) due February 15, 2033 of the
Underlying Securities Issuer.
Underlying Securities
Indenture: Indenture dated as of May 19, 1999 between the
Underlying Securities Issuer and the Trustee.
Underlying Securities Issuer: The Xxxxxxx Xxxxx Group, Inc., a Delaware
corporation.
Underlying Securities Trustee: The Bank of New York
Underlying Securities 00000XXX0
CUSIP Number:
Underlying Securities February 13, 2003
Original Issue Date:
Underlying Securities $2,000,000,000 6.125% Notes due 2033 (principal
Original Amount Issued: amount $1,000 per security)
Underlying Securities 333-63082
Commission Filing Number:
Underlying Securities February 15, 2033
Maturity Date:
Underlying Securities February 15, 2033
Principal Payment Date:
Underlying Securities February 15 and August 15, or if any such date is
Interest Payment Dates: 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 February 1 or August 1,
respectively, immediately prior to the relevant
interest payment date, subject to certain
exceptions.
Underlying Securities 6.125% per annum.
Interest Rate:
Underlying Securities February 1 and August 1.
Record Dates:
Underlying Securities In certain circumstances summarized in the
Redemption: Prospectus Supplement, the Underlying Securities
will be redeemable at the option of the Underlying
Securities Issuer, in whole or in part, at a
redemption price equal to the greater of (1) 100%
of the principal amount of the underlying
securities to be redeemed or (2) as determined by
the quotation agent described below, the sum of
the present values of the remaining scheduled
payments of principal and interest on the
underlying securities to be redeemed, not
including any portion of these payments of
interest accrued as of the date on which the
underlying securities are to be redeemed,
discounted to the date on which the underlying
securities are to be redeemed on a semi-annual
basis assuming a 360-day year consisting of twelve
30-day months, at the adjusted treasury rate
described below plus 20 basis points, plus, in
each case, accrued interest on the underlying
securities to be redeemed to the date on which the
underlying securities are to be redeemed.
Additionally, the Underlying Securities Issuer
will be entitled, at its option, to redeem the
Underlying Securities in whole and not in part if
at any time it becomes obligated to pay additional
amounts on any Underlying Securities on the next
interest payment date, but only if its obligation
results from a change in the laws or regulations
of any U.S. taxing authority, or from a change in
any official interpretation or application of
those laws or regulations, that becomes effective
or is announced on or after February 6, 2003. If
it redeems the Underlying Securities pursuant to
this tax event redemption right, it will do so at
a redemption price equal to 100% of the principal
amount of the underlying securities redeemed, plus
accrued interest to the redemption date. Holders
of the underlying securities to be redeemed will
receive at least 30 days but not more than 60 days
notice of a redemption.
Underlying Securities None.
Collateral:
Underlying Securities None.
Amortization:
Underlying Securities Semi-annual.
Accrual Periods:
Underlying Securities The Underlying Securities are denominated and
Authorized Denomination payable in U.S. dollars and are available in
and Specified Currency: minimum denominations of $1,000 and integral
multiples thereof.
Underlying Securities "Aa3" by Xxxxx'x and "A+" by S&P.
Rating as of Closing:
Underlying Securities Form: Book-entry security with DTC.
EXHIBIT A
Standard Terms for Trust Agreements
(begins on next page)
EXHIBIT B
Form of Class A Certificate
(begins on next page)
EXHIBIT C
Form of Class B Certificate
(begins on next page)
EXHIBIT D
Market Agent Agreement
(begins on next page)
EXHIBIT E
Form of Escrow Agreement
(begins on next page)
