SERIES SUPPLEMENT
FREEDOM CERTIFICATES(SM)
USAUTOS SERIES 2004-1 TRUST
between
FREEDOM DEPOSITORY, LLC
as Depositor,
and
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee,
FREEDOM CERTIFICATES(SM)
Dated as of October 28, 2004
Table of Contents
PAGE
Section 1. Incorporation of Standard Terms...................................1
Section 2. Definitions.......................................................1
Section 3. Designation of Trust and Certificates.............................8
Section 4. Trust Certificates...............................................11
Section 5. Distributions....................................................11
Section 6. Trustee's Fees...................................................16
Section 7. Optional Exchange; Optional Call.................................16
Section 8. Notices of Events of Default.....................................21
Section 9. Miscellaneous....................................................22
Section 10. Governing Law....................................................25
Section 11. Counterparts.....................................................25
Section 12. Termination of the Trust.........................................25
Section 13. Sale of Underlying Securities; Optional Exchange.................25
Section 14. Amendments.......................................................26
Section 15. Voting of Underlying Securities, Modification of Indenture.......26
Section 16. Additional Depositor Representation..............................27
SCHEDULE I. SERIES 2004-1 UNDERLYING SECURITIES SCHEDULE
EXHIBIT A-1 FORM OF TRUST CERTIFICATE CLASS A
EXHIBIT A-2 FORM OF TRUST CERTIFICATE CLASS X
EXHIBIT B FORM OF WARRANT AGENT AGREEMENT
EXHIBIT C FORM OF INVESTMENT LETTER
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SERIES SUPPLEMENT
FREEDOM CERTIFICATES(SM)
USAUTOS SERIES 2004-1 TRUST
SERIES SUPPLEMENT, USAutos Series 2004-1 Trust, dated as of October 28,
2004 (the "Series Supplement"), by and between FREEDOM DEPOSITORY, LLC, as
Depositor (the "Depositor"), and U.S. BANK TRUST NATIONAL ASSOCIATION, as
Trustee (the "Trustee").
W I T N E S S E T H:
WHEREAS, the Depositor desires to create the Trust designated herein
(the "Trust") by executing and delivering this Series Supplement, which shall
incorporate the terms of the Standard Terms for Trust Agreements, dated as of
October 1, 2004 (the "Standard Terms;" and together with this Series Supplement,
the "Trust Agreement"), by and between the Depositor and the Trustee, as
modified by this Series Supplement;
WHEREAS, the Depositor desires to deposit into the Trust the Underlying
Securities described on Schedule I attached hereto, the general terms of which
are described in the Prospectus Supplement under the heading "Description of the
Deposited Assets - Underlying Securities;"
WHEREAS, in connection with the creation of the Trust and the deposit
therein of the Underlying Securities, it is desired to provide for the issuance
of trust certificates evidencing undivided interests in the Trust and call
warrants related thereto; and
WHEREAS, the Trustee has joined in the execution of the Standard Terms
and this Series Supplement to evidence the acceptance by the Trustee of the
Trust.
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants expressed herein, it is hereby agreed by and between the
Depositor and the Trustee as follows:
Section 1. INCORPORATION OF STANDARD TERMS. Except as otherwise
provided herein, all of the provisions of the Standard Terms are hereby
incorporated herein by reference in their entirety, and this Series Supplement
and the Standard Terms shall form a single agreement between the parties. In the
event of any inconsistency between the provisions of this Series Supplement and
the provisions of the Standard Terms, the provisions of this Series Supplement
will control with respect to the Freedom Certificates(SM), USAutos Series 2004-1
and the transactions described herein.
Section 2. DEFINITIONS.
(a) Except as otherwise specified herein or as the context may
otherwise require, the following terms shall have the respective meanings set
forth below for all purposes under this Series Supplement. (Section 2(b) below
sets forth terms listed in the Standard Terms which are
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not applicable to this Series.) Capitalized terms used but not defined herein
shall have the meanings assigned to them in the Standard Terms.
"Accredited Investor" shall mean a Person that qualifies as an
"accredited investor" within the meaning of Rule 501(a) under the Securities
Act.
"Available Funds" shall have the meaning specified in the Standard
Terms.
"Business Day" shall mean any day other than a Saturday or a Sunday, or
a day on which banking institutions in New York, New York are authorized or
obligated by law or executive order to be closed.
"Calculation Agent" shall mean Freedom Depository, LLC or such
affiliate thereof as shall be designated by Amherst Securities Group, L.P.
"Call Date" shall mean any Business Day that any holder of Call
Warrants designates as a Call Date occurring (i) on or after October 28, 2005,
(ii) after one of the Underlying Securities Issuers announces that it will
redeem, prepay or otherwise make an unscheduled payment on the related
Underlying Securities, (iii) after the Trustee notifies the Certificateholders
of any proposed sale of any of the Underlying Securities pursuant to the
provisions of Section 5(d) or 5(h) of this Series Supplement or (iv) on the date
on which one of the Underlying Securities Issuers or an affiliate thereof
consummates a tender offer for some or all of the Underlying Securities is
consummated.
"Call Notice" shall have the meaning specified in Section 1.1 of the
Warrant Agent Agreement.
"Call Price" shall mean, for each related Call Date, (i) in the case of
the Class A Certificates, 100% of the outstanding Certificate Principal Balance
of the Class A Certificates being purchased pursuant to the exercise of the Call
Warrants, plus any accrued and unpaid interest on such amount to but excluding
the Call Date and, (ii) in the case of the Class X Certificates, the present
value of all amounts that would otherwise have been payable on the Class X
Certificates being purchased pursuant to the exercise of the Call Warrants for
the period from the related Call Date to the Final Scheduled Distribution Date,
using a discount rate of 6.00% per annum and assuming no delinquencies,
deferrals, redemptions or prepayments on the Underlying Securities shall occur
after the related Call Date.
"Call Warrants" shall have the meaning specified in Section 3 hereof.
"Called Certificates" shall have the meaning specified in Section 1.1
(b) of the Warrant Agent Agreement.
"Certificate Principal Balance" shall have the meaning specified in
Section 3 hereof.
"Certificates" shall have the meaning specified in Section 3 hereof.
"Class A Allocation" shall mean the sum of the present values
(discounted at the rate of 5.10% per annum) of (i) any unpaid interest due or to
become due on the Class A Certificates
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and (ii) the outstanding Certificate Principal Balance of the Class A
Certificates, (in each case) assuming that the Class A Certificates were paid
when due and were not redeemed or prepaid prior to their stated maturity.
"Class A Amount" shall mean an amount equal to interest at a rate of
5.10% per annum on the outstanding Certificate Principal Balance of the Class A
Certificates.
"Class A Certificates" shall mean the Certificates, in the form
attached hereto as Exhibit A-1, to be issued by the Trust representing a
proportionate undivided beneficial ownership interest in certain distributions
to be made by the Trust and having the characteristics described herein and in
the Certificates.
"Class X Allocation" shall mean the present value (discounted at the
rate of 6.00% per annum) of any unpaid amounts due or to become due on the
outstanding notional amount of the Class X Certificates (assuming that the Class
X Certificates were paid when due and were not redeemed or prepaid prior to
their stated maturity).
"Class X Amount" shall mean an amount equal to interest at the
applicable Class X Rate on the outstanding notional amount of the Class X
Certificates, which notional amount shall be equal to the Certificate Principal
Balance of the Class A Certificates, as reduced from time to time pursuant to
this Supplement.
"Class X Certificates" shall mean the Certificates, in the form
attached hereto as Exhibit A-2, to be issued by the Trust representing a
proportionate undivided beneficial ownership interest in certain distributions
to be made by the Trust and having the characteristics described herein and in
the Certificates.
"Class X Rate" shall mean, for each Distribution Date, a rate per annum
determined by dividing (x) the sum of (i) the product of (a) the outstanding
principal amount of 7.375% Underlying Securities held by the Trust and (b)
2.2125% and (ii) the product of (a) the outstanding principal amount of 7.25%
Underlying Securities held by the Trust and (b) 2.2125% by (y) the aggregate
outstanding principal amount of 7.375% Underlying Securities and 7.25%
Underlying Securities held by the Trust.
"Certificates" shall mean the certificates in the form attached hereto
as Exhibit A, to be issued by the Trust representing a proportionate undivided
beneficial ownership interest in certain distributions to be made by the Trust
and having the characteristics described herein and in the Certificates.
"Closing Date" shall mean October 28, 2004.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collection Period" shall mean, (i) with respect to each September
Distribution Date, the period beginning on the day after the March Distribution
Date of such year and ending on such September Distribution Date, inclusive,
and, (ii) with respect to each March Distribution Date, the period beginning on
the day after the September Distribution Date of the prior year and ending on
such March Distribution Date, inclusive; provided, however, that clauses (i) and
(ii)
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shall be subject to Section 9(f) hereof. The initial Collection Period shall be
the period beginning on October 28, 2004 and ending on the March Distribution
Date in 2005.
"Corporate Trust Office" shall mean the office of U.S. Bank Trust
National Association located at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Currency" shall mean United States Dollars.
"Depository" shall mean The Depository Trust Company, its nominees and
their respective successors.
"Distribution Date" shall mean March 3 and September 3 of each year (or
if any such date is not a Business Day, the next succeeding Business Day),
commencing in March, 2005; and ending on the earlier of the Final Scheduled
Distribution Date and any date on which all Underlying Securities are redeemed,
prepaid or liquidated in whole for any reason other than their maturity.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
"Event of Default" shall mean (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 Indenture.
"Exchange Act" shall mean the Securities and Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"Final Scheduled Distribution Date" shall mean the Distribution Date in
March, 2011.
"Indenture" shall mean either of the related indentures between an
Underlying Securities Issuer and the related Underlying Securities Trustee,
pursuant to which the Underlying Securities were issued, as supplemented.
"Liquidation Price" shall mean the price at which the Trustee sells the
Underlying Securities.
"Maturity Date" shall have the meaning specified in Schedule I hereto.
"Moody's" shall mean Xxxxx'x Investors Service, Inc.
"Optional Call" shall mean the call of the Certificates by the Warrant
Holder, in whole, resulting from the exercise of Call Warrants by the Warrant
Holder, pursuant to Section 7(d) hereof.
"Optional Exchange" shall mean the exchange of the Certificates by the
Trust for the Underlying Securities pursuant to Section 7(a) hereof.
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"Optional Exchange Date" shall mean any date on which Underlying
Securities subject to Optional Exchange are distributed to a Certificateholder.
"Ordinary Expenses" shall mean the Trustee's ordinary expenses and
overhead in connection with its services as Trustee, including the items
referred to in the definition of Ordinary Expenses in the Standard Terms.
"Plan" means (a) an employee benefit plan (as defined in Section 3(3)
of ERISA), (b) a plan described in Section 4975(e)(1) of the Code or (c) any
entity whose underlying assets are treated as assets of any such plan by reason
of such plan's investment in the entity.
"Prepaid Ordinary Expenses" shall be zero for this Series.
"Prospectus Supplement" shall mean the Prospectus Supplement, dated
October 21, 2004, relating to the Class A Certificates.
"QIB" shall have the meaning set forth in Section 3(e) hereof.
"Rating Agencies" shall mean Moody's and S&P.
"Record Date" shall mean, with respect to each Distribution Date, the
day immediately preceding the related Distribution Date.
"Required Percentage--Amendment" shall be 66-2/3% of the aggregate
Voting Rights, unless the subject amendment requires the vote of holders of only
one class of Certificates pursuant to the Standard Terms, in which case 66-2/3%
of the Voting Rights of such Class.
"Required Percentage--Direction of Trustee" shall be 66-2/3% of the
aggregate Voting Rights.
"Required Percentage--Remedies" shall be 66-2/3% of the aggregate
Voting Rights.
"Required Percentage--Removal" shall be 66-2/3% of the aggregate Voting
Rights.
"Required Rating" shall mean, in the case of Moody's, the rating
assigned to the Underlying Securities by Moody's as of the Closing Date, and, in
the case of S&P, the rating assigned to the Underlying Securities by S&P as of
the Closing Date.
"Resale Restriction Termination Date" shall have the meaning set forth
in Section 3(e) hereof.
"Rule 144A" shall have the meaning set forth in Section 3(e) hereof.
"S&P" shall mean Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc.
"SEC Reporting Failure" shall mean, with respect to an Underlying
Securities Issuer, the date determined by the Depositor within a reasonable time
following such Underlying Securities Issuer's either (x) having stated in
writing that it intends permanently to cease filing periodic
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reports required under the Exchange Act or (y) having failed to file all
required periodic reports for one full year.
"Securities Act" shall mean the United States Securities Act of 1933,
as amended.
"Securities Intermediary" shall mean initially, U.S. Bank Trust
National Association.
"Series" shall mean the USAutos Series 2004-1.
"Special Distribution Date" shall have the meaning specified in Section
5 hereof.
"Trustee Fee" shall mean the amount paid to the Trustee by the
Depositor on the Closing Date.
"Trust Property" shall mean the Underlying Securities described on
Schedule I hereto, the Certificate Account and any additional Underlying
Securities sold to the Trust pursuant to Section 3(d) hereof.
"UCC" shall mean the Uniform Commercial Code as in effect in the
applicable jurisdiction.
"Underlying Securities" shall mean (i) $2,000,000 aggregate principal
amount of 7.375% Debentures due February 1, 2011 issued by Ford Motor Credit
Company (the "7.375% Underlying Securities") and (ii) $2,000,000 aggregate
principal amount of 7.25% Debentures due March 2, 2011 issued by General Motors
Acceptance Corporation (the "7.25% Underlying Securities") each as set forth in
Schedule I attached hereto (subject to Section 3(d) hereof).
"Underlying Securities Issuers" shall mean Ford Motor Credit Company
and General Motors Acceptance Corporation, and any successors in respect of the
Underlying Securities.
"Underlying Securities Trustees" shall mean The Chase Manhattan Bank
with respect to the 7.375% Underlying Securities and The Bank of New York with
respect to the 7.25% Underlying Securities.
"Underwriter" shall mean Amherst Securities Group, L.P.
"Voting Rights" shall be allocated between the holders of the Class A
Certificates and the holders of the Class X Certificates, pro rata, in
proportion to the ratio of the Class A Allocation to the Class X Allocation. The
Class A Voting Rights will be allocated among Class A Certificateholders in
proportion to the then unpaid Certificate Principal Balances of their respective
Certificates. The Class X Voting Rights will be allocated among the Class X
Certificateholders in proportion to the then outstanding notional amounts of
their respective Certificates.
"Warrant Agent" shall mean initially, U.S. Bank Trust National
Association.
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"Warrant Agent Agreement" shall mean that certain Warrant Agent
Agreement, dated as of the date hereof, between the Depositor and U.S. Bank
Trust National Association, as Warrant Agent and as Trustee, as the same may be
amended from time to time.
"Warrant Holder" shall mean the holder of a Call Warrant.
(b) The terms listed below are not applicable to this Series.
"Accounting Date"
"Administrative Fees"
"Advance"
"Allowable Expense Amounts"
"Basic Documents"
"Calculation Agent"
"Call Premium Percentage"
"Credit Support"
"Credit Support Instrument"
"Credit Support Provider"
"Cut-off Date"
"Eligible Expense"
"Eligible Investments"
"Exchange Rate Agent"
"Fixed Pass-Through Rate"
"Floating Pass-Through Rate"
"Guaranteed Investment Contract"
"Letter of Credit"
"Limited Guarantor"
"Limited Guaranty"
"Minimum Wire Denomination"
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"Pass-Through Rate"
"Place of Distribution"
"Purchase Price"
"Required Premium"
"Required Principal"
"Requisite Reserve Amount"
"Retained Interest"
"Sale Procedures"
"Sub-Administration Account"
"Sub-Administration Agreement"
"Sub-Administration Agent"
"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. The Trust created
hereby shall be known as the "USAutos Series 2004-1 Trust." The Certificates
evidencing certain undivided ownership interests therein shall be known as
"Freedom Certificates(SM), USAutos Corporate Backed Series 2004-1." The
Certificates shall consist of the Class A Certificates and the Class X
Certificates (together, the "Certificates"). The Trust is also issuing call
warrants with respect to the Certificates ("Call Warrants").
(a) The Class A Certificates shall be held through the Depository in
book-entry form and shall be substantially in the form attached hereto as
Exhibit A-1. The Class X Certificates shall initially be in physical form and,
as set forth in Section 3(d) below, shall be held subsequent to the Closing Date
in physical form or through the Depository in book-entry form and shall be
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substantially in the form attached hereto as Exhibit A-2. The Class A
Certificates shall be issued in denominations of $1,000. The Class X
Certificates shall be issued in minimum notional denominations of $100,000 and
integral multiples of $1 in excess thereof; provided, however, that on any Call
Date on which a Warrant Holder shall concurrently exchange Called Certificates
for a distribution of Underlying Securities in accordance with the provisions of
Section 7 hereof, Called Certificates may be issued in other denominations.
Except as provided in the Standard Terms and in paragraph (d) in this Section,
the Trust shall not issue additional Certificates or additional Call Warrants or
incur any indebtedness.
(b) The Class A Certificates shall consist initially of 4,000
Certificates having an initial aggregate certificate principal balance (the
"Certificate Principal Balance") of $4,000,000. The Class X Certificates are
interest-only Certificates and shall have an initial aggregate notional amount
equal to the initial Certificate Principal Balance of the Class A Certificates.
(c) The holders of the Class A Certificates will be entitled to receive
on each Distribution Date an amount equal to their pro rata share of Available
Funds calculated as follows: the amount of the Available Funds multiplied by a
ratio the numerator of which is the Class A Amount and the denominator of which
is the sum of the Class A Amount and the Class X Amount each as determined on
the such Distribution Date. The holders of the Class X Certificates will be
entitled to receive on each Distribution Date an amount equal to their pro rata
share of Available Funds calculated as follows: the amount of the Available
Funds multiplied by a ratio the numerator of which is the Class X Amount and the
denominator of which is the sum of the Class A Amount and the Class X Amount
each as determined on the such Distribution Date. On the Distribution Date
occurring in March 2005, the Trustee shall cause the Trust to pay to the
Depositor the amount of interest accrued and paid on the (i) 7.375% Underlying
Securities from August 1, 2004 to but not including the Closing Date and (ii)
7.25% Underlying Securities from September 2, 2004, to but not including the
Closing Date; provided, however, that in the event an Optional Exchange Date
shall occur prior to the Distribution Date in March 2005, a pro rata portion of
such amount shall be paid to the Depositor on the Optional Exchange Date in
accordance with the provisions of Section 7(b)(vii) hereof. If the Depositor is
not paid any such amount on such date, it will have a claim for such amount. If
Available Funds are insufficient to pay such amount, on each Distribution Date
the Trustee will apply Available Funds first to the holders of the Certificates
in payment of all amounts owned on the Certificates in respect of accrued
interest and then to the Depositor until the Depositor is paid in full.
(d) No Class X Certificate may be offered, resold, assigned or
otherwise transferred (including by pledge or hypothecation) at any time prior
to (x) the date which is two years, or such shorter period of time as permitted
by Rule 144(k) under the Securities Act, after the later of the original issue
date of such Class X Certificates and the last date on which the Depositor or
any "affiliate" (as defined in Rule 144 under the Securities Act) of the
Depositor was the owner of such Class X Certificates (or any predecessor
thereto) or (y) such later date, if any, as may be required by a change in
applicable securities laws (the "Resale Restriction Termination Date") unless
such offer, resale, assignment or transfer is (i) to the Trust, (ii) pursuant to
an effective registration statement under the Securities Act, (iii) to a
qualified institutional buyer (a "QIB"), as such term is defined in Rule 144A
promulgated under the Securities Act ("Rule 144A"), in accordance with Rule 144A
or (iv) pursuant to another available exemption from registration provided under
the Securities Act (including transfers to Accredited Investors), and, in each
of
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cases (i) through (iv), in accordance with any applicable securities laws of any
state of the United States and other jurisdictions. Notwithstanding the
foregoing, Class X Certificate may not be offered, resold, assigned or otherwise
transferred (including by pledge or hypothecation) at any time unless the
prospective transferee is acquiring the Call Warrants concurrently with the
Class X Certificates. Prior to any offer, resale, assignment or transfer of any
Class X Certificates in the manner described in clause (iii) above, the
prospective transferee and the prospective transferor shall be required to
deliver to the Trustee an executed copy of an Investment Letter with respect to
the Class X Certificates to be transferred substantially in the form of Exhibit
C hereto and in the event the resale, assignment or transfer shall involve Class
X Certificates then being held in physical form, such Class X Certificates shall
be delivered to the Trustee for cancellation and the Trustee shall instruct the
Depository to increase the aggregate notional amount of the Class X Certificates
held in book-entry form by an amount equal to the aggregate notional amount of
the Class X Certificates so resold, assigned or transferred and to issue a
beneficial interest in such global Class X Certificates to such transferee.
Prior to any offer, resale, assignment or transfer of any Class X Certificates
in the manner described in clause (iv) above, the prospective transferee and the
prospective transferor shall be required to deliver to the Trustee documentation
certifying that the offer, resale, assignment or transfer complies with the
provisions of said clause (iv) and, in the event any such Class X Certificate
shall then be held in book-entry form and such resale, assignment or transfer
shall be to an Accredited Investor that is not a QIB, the Trustee shall instruct
the Depository to decrease the aggregate notional amount of the Class X
Certificates held in book-entry form and the Trustee shall authenticate and
deliver one or more Class X Certificates in physical form in an aggregate
notional amount equal to the amount of Class X Certificates resold, assigned or
transferred. In addition to the foregoing, each prospective transferee of any
Class X Certificates in the manner contemplated by clause (iii) above shall
acknowledge, represent and agree as follows:
(1) The transferee (x) is a QIB, (y) is aware that the
sale to it is being made in reliance on Rule 144A and
(z) is acquiring such Class X Certificates for its
own account or for the account of a QIB.
(2) The transferee understands that the Class X
Certificates are being offered in a transaction not
involving any public offering in the United States
within the meaning of the Securities Act, and that
the Class X Certificates have not been and will not
be registered under the Securities Act.
(3) The transferee agrees that (A) if in the future it
decides to offer, resell, pledge or otherwise
transfer the Class X Certificates prior to the Resale
Restriction Termination Date, such Class X
Certificates shall only be offered, resold, assigned
or otherwise transferred (i) to the Trust, (ii)
pursuant to an effective registration statement under
the Securities Act, (iii) to a QIB, in accordance
with Rule 144A or (iv) pursuant to another available
exemption from registration provided under the
Securities Act (including any transfer to an
Accredited Investor), and, in each of cases (i)
through (iv), in accordance with any applicable
securities laws of any state of the United States and
other jurisdictions and (B) the
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transferee will, and each subsequent holder is
required to, notify any subsequent purchaser of such
Class X Certificates from it of the resale
restrictions referred to in clause (A) above.
(4) The transferee, concurrent with the transfer of the
Class X Certificate is acquiring the Call Warrants.
(e) The Class X Certificates will, unless otherwise agreed by the
Depositor and the Trustee, bear a legend substantially to the following effect:
"THIS CLASS X CERTIFICATE (OR ITS PREDECESSOR) HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND
MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT
WHILE A REGISTRATION UNDER SUCH ACT IS IN EFFECT OR PURSUANT
TO AN EXEMPTION THEREFROM UNDER SUCH ACT. THE CLASS X
CERTIFICATE REPRESENTED HEREBY MAY BE TRANSFERRED ONLY IN
ACCORDANCE WITH THE TERMS OF THE SERIES SUPPLEMENT.
EACH PURCHASER OF THIS CLASS X CERTIFICATE IS HEREBY NOTIFIED
THAT THE SELLER OF THIS CLASS X CERTIFICATE MAY BE RELYING ON
THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER."
Section 4. TRUST CERTIFICATES. The Trustee hereby acknowledges receipt,
on or prior to the Closing Date, of:
(a) the Underlying Securities set forth on Schedule I hereto; and
(b) all documents required to be delivered to the Trustee pursuant to
Section 2.01 of the Standard Terms.
Section 5. DISTRIBUTIONS.
(a) Except as otherwise provided in Sections 5(b), 5(c) and 5(j), on
each applicable Distribution Date (or such later date as specified in Section
9(f)), the Trustee shall apply Available Funds in the Certificate Account as
follows:
(i) The Trustee will pay the interest portion of Available
Funds:
(1) first, to the Trustee, as reimbursement for any
Extraordinary Trust Expenses incurred by the Trustee in
accordance with Section 6(b) below and approved by 100% of the
Certificateholders; and
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(2) second, to the holders of the Class A
Certificates and the holders of the Class X Certificates,
interest accrued and unpaid on each such Class, pro rata, in
proportion to their entitlements thereto.
(ii) the Trustee will pay the principal portion of Available
Funds:
(1) first, to the Trustee, as reimbursement for any
remaining Extraordinary Trust Expenses incurred by the Trustee
in accordance with Section 6(b) below and approved by 100% of
the Certificateholders; and
(2) second, to the holders of the Class A
Certificates, the remaining available principal portion of
Available Funds, in an aggregate amount not to exceed the
outstanding Certificate Principal Balance of the Class A
Certificates.
(iii) any Available Funds remaining in the Certificate Account
after the payments set forth in clauses 5(a)(i) and 5(a)(ii) above
shall be paid to the Trustee as reasonable compensation for services
rendered to the Depositor, up to $1,000.
(iv) the Trustee will pay any Available Funds remaining in the
Certificate Account after the distributions in clauses 5(a)(i) through
5(a)(iii) above to the holders of the Class A Certificates and Class X
Certificates pro rata in proportion to the interest rate on each such
class of Certificates.
The Class X Certificates are not entitled to distributions of
principal.
Any portion of the Available Funds (i) that does not constitute principal of, or
interest on, the Underlying Securities, (ii) that is not received in connection
with a tender offer, redemption, prepayment or liquidation of any Underlying
Securities and (iii) for which allocation by the Trustee is not otherwise
contemplated by this Series Supplement, shall be remitted by the Trustee to the
Depositor.
(b) Notwithstanding the foregoing, if any of the Underlying Securities
are redeemed, prepaid or liquidated in whole or in part for any reason other
than due to the occurrence of an Event of Default, an SEC Reporting Failure, or
at their maturity, the Trustee shall apply Available Funds in the manner
described in Section 5(g) in the following order of priority:
(i) first, to the Trustee, as reimbursement for any
Extraordinary Trust Expenses incurred by the Trustee in accordance with
Section 6(b) below and approved by 100% of the Certificateholders;
(ii) second, to the holders of the Class A Certificates, an
amount equal to the principal amount of Underlying Securities so
redeemed, prepaid or liquidated plus accrued and unpaid interest on the
amount of Class A Certificates redeemed in connection with such
principal payment;
(iii) third, to the holders of the Class X Certificates, an
amount not to exceed the present value of all amounts that would
otherwise have been payable on the Class X Certificates for the period
from the date of such redemption or prepayment to the Final
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Scheduled Distribution Date using a discount rate of 6.00% per annum,
assuming no delinquencies, deferrals, redemptions or prepayments on the
Underlying Securities;
(iv) fourth, to the Trustee, as reasonable compensation for
services rendered to the Depositor, any remainder up to $1,000; and
(v) fifth, any remainder to the holders of the Class A
Certificates and the Class X Certificates pro rata in proportion to the
ratio of the Class A Allocation to the Class X Allocation.
(c) Notwithstanding the foregoing, if any of the Underlying Securities
are redeemed, prepaid or liquidated in whole or in part due to the occurrence of
an Event of Default, the Trustee shall distribute Available Funds with respect
to such Underlying Securities to the holders of the Class A Certificates and the
holders of the Class X Certificates in accordance with the ratio of the Class A
Allocation to the Class X Allocation.
(d) Unless otherwise instructed by holders of Certificates representing
a majority of the Voting Rights, thirty (30) days after giving notice pursuant
to Section 8 hereof, the Trustee shall sell the Underlying Securities for which
an Event of Default has occurred pursuant to Section 13 hereof and deposit the
Liquidation Proceeds, if any, into the Certificate Account for distribution not
later than two (2) Business Days after the receipt of immediately available
funds in accordance with Section 5(b) hereof; provided, however, that if any
Warrant Holder designates any day on or prior to the proposed sale date as a
Call Date and Optional Exchange Date pursuant to Section 7, the portion of
Underlying Securities related to such Optional Exchange shall not be sold but
shall be distributed to the Warrant Holder pursuant to Section 7 and the Warrant
Agent Agreement.
(e) If the Trustee receives non-cash property in respect of any of the
Underlying Securities as a result of a payment default on the Underlying
Securities (including from the sale thereof), the Trustee will promptly give
notice to the Depository, or for any Certificates which are not then held by DTC
or any other depository, directly to the registered holders of the Certificates
then outstanding and unpaid and to the Warrant Agent. Such notice shall state
that the Trustee shall, and the Trustee shall, not later than 30 days after the
receipt of such property, allocate and distribute such property to the holders
of Class A Certificates and Class X Certificates then outstanding and unpaid
(after deducting the costs incurred in connection therewith) in accordance with
Section 5(b) hereof. Property other than cash will be liquidated by the Trustee,
and the proceeds thereof distributed in cash, only to the extent necessary to
avoid distribution of fractional securities to Certificateholders. In-kind
distribution of such property to Certificateholders, based on the market value
of such property as of the date of distribution to Certificateholders, will be
deemed to reduce the Certificate Principal Balance of the Class A Certificates
on a dollar-for-dollar basis. The outstanding notional amounts of the Class X
Certificates shall be reduced, pro rata among all Class X Certificateholders, by
an amount equal to the amount by which the Certificate Principal Balance of the
Class A Certificates is reduced.
(f) Subject to Section 9(f) hereof, to the extent Available Funds are
insufficient to make any scheduled interest or principal payments on any class
of Certificates on any Distribution Date, any shortfall will be carried over and
will be distributed on the next Distribution Date (or
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date referred to in Section 5(h) hereof) on which sufficient funds are available
to pay such shortfall.
(g) If a payment with respect to the Underlying Securities is made to
the Trustee (i) after the payment date of the Underlying Securities on which
such payment was due or (ii) in connection with redemption, prepayment or
liquidation, in whole or in part, of the Underlying Securities for any reason
other than due to the occurrence of an Event of Default, an SEC Reporting
Failure or at their maturity, the Trustee will distribute any such amounts
received in accordance with the provisions of this Section 5 on the next
occurring Business Day (a "Special Distribution Date") as if the funds had
constituted Available Funds on the Distribution Date immediately preceding such
Special Distribution Date; provided, however, that the Record Date for such
Special Distribution Date shall be one Business Day prior to the day on which
the related payment was received with respect to the Underlying Securities.
(h) Upon the occurrence of an SEC Reporting Failure, the Depositor
shall instruct the Trustee within a reasonable time to (i) notify the Warrant
Agent that the Underlying Securities are proposed to be sold and that any Call
Warrants and related Optional Exchange rights must be exercised no later than
the date specified in the notice (which shall be not less than ten Business Days
after the date of such notice) and (ii) to the extent that the Warrant Holders
fail to exercise their Call Warrants and related Optional Exchange rights on or
prior to such date, to sell the Underlying Securities of the Underlying
Securities Issuer that experienced the SEC Reporting Failure and distribute the
proceeds of such sale to the Certificateholders in accordance with the following
order of priority: first, to the Trustee, as reimbursement for any Extraordinary
Trust Expenses incurred by the Trustee in accordance with Section 6(b) below and
approved by 100% of the Certificateholders; and second, any remainder to the
holders of the Class A Certificates and the Class X Certificates pro rata in
proportion to the ratio of the Class A Allocation to the Class X Allocation, as
determined by the Calculation Agent.
(i) On any date on which Underlying Securities are redeemed, prepaid or
liquidated for any reason, the aggregate outstanding notional amount of the
Class X Certificates shall be reduced by an amount equal to the principal amount
of the Underlying Securities so redeemed, prepaid or liquidated, the reduction
for the Class X Certificates to be allocated pro rata among all Class X
Certificates.
(j) (i) Within five Business Days (or such longer period as shall be
acceptable to the Trustee) of receipt of notice of an SEC Reporting Failure, any
Class A Certificateholder or Class X Certificateholder may direct the Trustee to
distribute all or a portion of such Certificateholder's pro rata share of such
Underlying Securities to it, in lieu of any proceeds received upon liquidation
of any of the Underlying Securities. The respective pro rata shares of the Class
A and Class X Certificateholders in such Underlying Securities shall be
determined by allocating the portion of the principal amount remaining after
reimbursement of the Trustee for any Extraordinary Trust Expenses approved by
100% of the Certificateholders to the Class A Certificateholders and the Class X
Certificateholders in accordance with the ratio of the Class A Allocation to the
Class X Allocation. The pro rata share of each of the Class A Certificateholders
in such Underlying Securities to be distributed shall be determined based on the
then unpaid Certificate Principal Balances of their Class A Certificates and the
pro rata share of each of the
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Class X Certificateholders in such Underlying Securities to be distributed shall
be determined based on the then outstanding notional amounts of their respective
Certificates.
(ii) Within five Business Days (or such longer period as shall
be acceptable to the Trustee) of receipt of notice of an Event of
Default or any other liquidation of any of the Underlying Securities by
the Trustee, any Class X Certificateholder may direct the Trustee to
distribute all or a portion of such Class X Certificateholder's pro
rata share (as determined by the Calculation Agent in accordance with
this Section 5(j)) of such Underlying Securities to it, in lieu of any
proceeds received upon liquidation of such Underlying Securities. Upon
the occurrence of an Event of Default, each Class X Certificateholder's
pro rata share of such Underlying Securities shall be determined by
allocating the principal amount of such Underlying Securities to the
Class A Certificateholders and the Class X Certificateholders in
accordance with the ratio of the Class A Allocation to the Class X
Allocation. The pro rata share of each of the Class X
Certificateholders in the Underlying Securities to be distributed shall
be determined based on the then outstanding notional amounts of their
respective Certificates. In the event of a liquidation of any of the
Underlying Securities by the Trustee for any reason other than upon the
occurrence of an Event of Default or an SEC Reporting Failure, each
Class X Certificateholder's pro rata share of such Underlying
Securities shall be equal to the lesser of (1) a pro rata share (based
on the proportion of the aggregate notional amount of such holder's
Class X Certificates to the outstanding aggregate notional amount of
the Class X Certificates) of the principal amount of such Underlying
Securities remaining after the Trustee has allocated Available Funds in
accordance with Sections 5(b)(i) and 5(b)(ii) hereof and (2) the
present value of all amounts that would otherwise have been payable on
such Class X Certificate for the period from the date of such
redemption or prepayment to the Final Scheduled Distribution Date using
a discount rate of 6.00% per annum, assuming no delinquencies,
deferrals, redemptions or prepayments on such Underlying Securities.
(iii) The amount requested to be distributed pursuant to
Section 5(j)(i) or 5(j)(ii) must be in an even multiple of the minimum
denomination of the Underlying Securities and may not exceed such
requesting Certificateholder's pro rata share (as determined by the
Calculation Agent in accordance with this Section 5(j)) of the
Underlying Securities. Upon receipt of any such direction from a Class
A Certificateholder or Class X Certificateholder, the Trustee shall not
liquidate the requested portion of Underlying Securities and instead
shall cause such Underlying Securities to be distributed to the
requesting Class A Certificateholder or Class X Certificateholder;
provided, that the Trustee shall not cause the distribution of any
Underlying Securities to any Class A Certificateholder or Class X
Certificateholder unless, but for the requesting Class A
Certificateholder or Class X Certificateholder's giving direction in
accordance with this Section 5(j), such Underlying Securities would be
liquidated as otherwise provided in this Agreement. Any portion of any
Class A Certificateholder's or Class X Certificateholder's pro rata
share of the Underlying Securities that is not distributed, based on
the failure to meet the minimum denomination requirements or otherwise,
shall be sold in accordance with the provisions of Section 5(d) or 5(h)
hereof, as applicable and the proceeds thereof distributed to such
Class A Certificateholder or Class X Certificateholder.
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(iv) All decisions and determinations of the Calculation Agent
pursuant to this Section 5(j) shall be in its sole discretion and
shall, in the absence of manifest error, be conclusive for all purposes
and irrevocably binding upon the Certificateholders.
Section 6. TRUSTEE'S FEES.
(a) As compensation for its services hereunder, the Trustee shall be
entitled to the Trustee Fee and any amounts payable under clauses 5(a)(iii) and
(5)(b)(iv) above. The Trustee Fee shall be paid by the Depositor and not from
Trust Property. The Trustee shall bear all Ordinary Expenses. Failure by the
Depositor to pay such amount shall not entitle the Trustee to any payment or
reimbursement from the Trust, nor shall such failure release the Trustee from
the duties it is required to perform under the Trust Agreement.
(b) Extraordinary Expenses shall not be paid out of the Trust Property
unless all the holders of the Class A Certificates and Class X Certificates then
outstanding have directed the Trustee to incur such Extraordinary Expenses. The
Trustee may incur other Extraordinary Expenses if any lesser percentage of the
Certificateholders requesting such action pursuant hereto reimburse the Trustee
for the cost thereof from their own funds in advance. If Extraordinary Expenses
are not approved unanimously as set forth in the first sentence of this Section
6(b), such Extraordinary 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.
Section 7. OPTIONAL CALL; OPTIONAL EXCHANGE.
(a) (i) On (A) any Distribution Date, (B) any date on which a tender
offer for some or all of the Underlying Securities is consummated or
(C) any date on which any of the Underlying Securities are to be
redeemed by the related Underlying Securities Issuer, any holder of
Class A Certificates, Class X Certificates and the related Call
Warrants, if Call Warrants related to such Certificates are
outstanding, may exchange such Certificates and, if applicable, Call
Warrants, for a distribution of 7.375% Underlying Securities and 7.25%
Underlying Securities representing a like percentage of such 7.375%
Underlying Securities and 7.25% Underlying Securities as such
Certificates represent of all outstanding Certificates.
(ii) On any Call Date, any Warrant Holder may exchange Called
Certificates for a distribution of 7.375% Underlying Securities and
7.25% Underlying Securities representing a like percentage of such
7.375% Underlying Securities and 7.25% Underlying Securities as such
Called Certificates represent of all outstanding Certificates;
provided, however, that any such exchange shall either (x) result from
an exercise of all Call Warrants owned by such Warrant Holder or (y)
occur on a Call Date on which such Warrant Holder, alone or together
with one or more other Warrant Holders, shall exchange Called
Certificates relating to Underlying Securities having an aggregate
principal amount equal to or in excess of the product of (i) 0.1 and
(ii) the aggregate principal amount of the Underlying Securities
deposited into the Trust on the Closing Date. Notwithstanding the
foregoing, following the consummation of any exchange described above,
the remaining 7.375% Underlying Securities and 7.25% Underlying
16
Securities held by the Trust must be in the same proportion to each
other as exists on the date hereof.
(b) The following conditions shall apply to any Optional Exchange.
(i) A notice specifying the number of Certificates being
surrendered and the Optional Exchange Date shall be delivered to the
Trustee no less than 5 days (or such shorter period acceptable to the
Trustee) but not more than 30 days before the Optional Exchange Date;
provided, however, that for an Optional Exchange to occur on a Call
Date, unless otherwise specified therein, the Call Notice shall be
deemed to be the notice required hereunder.
(ii) Certificates and, if applicable, the Call Warrants, shall
be surrendered to the Trustee no later than 10:00 a.m. (New York City
time) on the Optional Exchange Date; provided that for an Optional
Exchange to occur on a Call Date, payment of the Call Price to the
Warrant Agent pursuant to Section 1.1(a)(iii) of the Warrant Agent
Agreement shall satisfy the requirement to surrender Certificates.
(iii) The Trustee shall have received an opinion of counsel
stating that the Optional Exchange would not cause the Trust to be
treated as an association or publicly traded partnership taxable as a
corporation for federal income tax purposes.
(iv) If the Certificateholder is the Depositor or any
Affiliate of the Depositor, (1) the Trustee shall have received a
certification from the Certificateholder that any Certificates being
surrendered have been held for at least six months, and (2) the
Certificates being surrendered may represent no more than 5% (or 25% in
the case of Certificates acquired by the Underwriters but never
distributed to investors) of the then outstanding Certificates.
(v) The Trustee shall not be obligated to determine whether an
Optional Exchange complies with the applicable provisions for exemption
under Rule 3a-7 of the Investment Company Act of 1940, as amended, or
the rules or regulations promulgated thereunder.
(vi) The provisions of Section 4.07 of the Standard Terms
shall not apply to an Optional Exchange pursuant to this Section 7(b).
This Section 7(b) shall not provide any person with a lien against, an
interest in or a right to specific performance with respect to the
Underlying Securities; provided that satisfaction of the conditions set
forth in this Section 7(b) shall entitle the Certificateholder or
Warrant Holder, as applicable, to a distribution thereof.
(vii) In the event such Optional Exchange shall occur prior to
the Distribution Date in March 2005, the Certificateholder shall have
paid to the Trustee, for distribution to the Depositor, on the Optional
Exchange Date an amount equal to the sum obtained by multiplying the
amount of accrued interest on the (i) 7.375% Underlying Securities from
August 1, 2004 to but not including the Closing Date and (ii) 7.25%
Underlying Securities from September 2, 2004, to but not including the
Closing Date by a fraction, the numerator of which shall be the number
of Certificates being exchanged on such
17
Optional Exchange Date and the denominator of which shall be the total
number of Certificates.
(viii) In the event that the face amount of 7.375% Underlying
Securities or the face amount of 7.25% Underlying Securities to be
distributed in connection with any Optional Exchange pursuant to
Section 7(a) is not an even multiple of $1,000, such amount shall be
rounded down to the nearest $1,000; provided, however, that the Trustee
shall further adjust the proportionate distribution of 7.375%
Underlying Securities and 7.25% Underlying Securities so that, after
giving effect to such rounding, the remaining Underlying Securities in
the Trust are scheduled to distribute sufficient interest to pay the
scheduled interest on the Certificates through the Final Scheduled
Distribution Date. In the event of such a rounding, the aggregate
principal amount of Certificates accepted for exchange shall be reduced
to take into account the effect of such rounding and the
Certificateholders (and, if applicable, the relevant Warrant Holders)
requesting the Optional Exchange shall be issued Certificates in the
amount of the remainder. If such Certificates are Called Certificates,
they may be exchanged for a distribution of Underlying Securities on
any subsequent Call Date on which the other requirements of Section
7(a) are met. For purposes of this provision, in any Optional Exchange
of Certificates for Underlying Securities on a Call Date by two or more
Certificateholders (and, if applicable, the relevant Warrant Holders),
if so instructed irrevocably in writing by all such Certificateholders
(and, if applicable, all such Warrant Holders), the Trustee shall
determine the effects of rounding for purposes of the second preceding
sentence with regard to the aggregate amount of 7.375% Underlying
Securities and the aggregate amount of 7.25% Underlying Securities to
be distributed (rather than each such Certificateholder's (and, if
applicable, Warrant Holder's) individual allotment) and shall round
each Certificateholder's (and, if applicable, Warrant Holder's)
proportionate distribution in accordance with such instructions from
such parties.
(c) Concurrently with the execution of this Series Supplement, the
Trustee, on behalf of the Trust, shall execute the Warrant Agent Agreement and
the Call Warrants, dated as of the date hereof and substantially in the form of
Exhibit B hereto, initially evidencing all of the Call Warrants. The Trustee
shall perform the Trust's obligations under the Warrant Agent Agreement and the
Call Warrants in accordance with their respective terms.
(d) Call Warrants may be exercised by the Warrant Holder in whole, but
not in part, on any Call Date. In addition to the conditions set forth in
Section 1.1 of the Warrant Agent Agreement, the following conditions shall apply
to any Optional Call.
(i) An opinion of counsel to the Warrant Holder shall have
been delivered to the Rating Agencies, in form satisfactory to the
Rating Agencies, indicating that payment of the Call Price shall not be
recoverable as a preferential transfer or fraudulent conveyance under
the United States Bankruptcy Code. Such opinion may contain customary
assumptions and qualifications.
(ii) The Warrant Holder shall have provided a certificate of
solvency to the Trustee.
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(iii) Class A Certificates and Class X Certificates
representing a like percentage of all outstanding Class A Certificates
and Class X Certificates shall be surrendered.
(iv) Upon receipt of a Call Notice, the Trustee shall provide
a conditional call notice to the Depository not less than 3 Business
Days prior to the Call Date.
(v) Delivery of a Call Notice does not give rise to an
obligation on the part of the Warrant Holder to pay the Call Price. If,
by 10:00 a.m. (New York City time) on the Call Date, the Warrant Holder
has not paid the Call Price, except in connection with a Call Notice
relating to a tender offer for or redemption of the Underlying
Securities, then the Call Notice shall automatically expire and none of
the Warrant Holder, the Warrant Agent or the Trustee shall have any
obligation with respect to the Call Notice. The expiration of a Call
Notice shall in no way affect the Warrant Xxxxxx's right to deliver a
Call Notice at a later date. The Call Price for a call in connection
with a tender offer or redemption shall be deducted from the proceeds
of a tender offer or redemption by the Trust pursuant to Section
7(g)(iii) or Section 7(h)(iii), as applicable.
(vi) The Trustee shall not consent to any amendment or
modification of this Agreement (including the Standard Terms) which
would adversely affect the Warrant Holders (including, without
limitation, any alteration of the timing or amount of any payment of
the Call Price or any other provision of this Agreement in a manner
adverse to the Warrant Holders) without the prior written consent of
100% of the Warrant Holders. For purposes of this clause, no amendment,
modification or supplement required to provide for any purchase by the
Trustee of additional Underlying Securities and authentication and
delivery by the Trustee of additional Certificates and Call Warrants
pursuant to Section 3(d) shall be deemed to adversely affect the
Warrant Holders.
(vii) The Trustee shall not be obligated to determine whether
an Optional Call complies with the applicable provisions for exemption
under Rule 3a-7 of the Investment Company Act of 1940, as amended, or
the rules or regulations promulgated thereunder.
(e) This Section 7 shall not provide the Warrant Holder with a lien
against, an interest in or a right to specific performance with respect to the
Underlying Securities; provided that satisfaction of the conditions set forth in
Section 7(b) shall entitle the Certificateholders or the Warrant Holders, as
applicable, to a distribution of the Underlying Securities.
(f) The rights of the Certificateholders under the Trust Agreement and
the Certificates are limited by the terms, provisions and conditions of the
Trust Agreement, the Warrant Agent Agreement and the Call Warrants with respect
to the exercise of the Call Warrants by the Warrant Holder. The
Certificateholders, by their acceptance of Certificates, covenant and agree to
tender any and all Called Certificates to the Trustee upon the Warrant Holder's
exercise of Call Warrants and payment of the Call Price for such Certificates in
accordance with the provisions hereof and of the Warrant Agent Agreement.
(g) (i) If the Trustee receives notice of a tender offer for some or
all of the 7.25% Underlying Securities or 7.375% Underlying Securities, the
Trustee shall within one Business Day notify the Warrant Agent and forward to
the Warrant Agent copies of all materials received
19
by the Trustee in connection therewith. Upon the commencement of a tender offer
from the Underlying Securities Issuer or an affiliate thereof and if the Trustee
receives a Call Notice from any Warrant Holder no later than five Business Days
prior to the expiration of the tender offer acceptance period that such Warrant
Holder desires to exercise all or a portion of its Call Warrants in connection
with the consummation of any such tender offer, then the Trustee shall tender,
in compliance with the tender offer requirements, an amount of 7.25% Underlying
Securities and/or 7.375% Underlying Securities, as applicable, equal to the
amount of such 7.40 Underlying Securities and/or 7.375% Underlying Securities
that would be distributable to the Warrant Holder with respect to an Optional
Exchange of the Called Certificates called by such Warrant Holder; provided that
any Optional Call or Optional Exchange undertaken in connection with any such
tender offer shall be subject to the provisions of Section 7 hereof.
(ii) The Call Date and Optional Exchange Date for any exercise
of Call Warrants in connection with a tender offer shall be deemed to
be the Business Day on which the related Underlying Securities are
accepted for payment and paid for.
(iii) The Call Price shall be deducted from the tender offer
proceeds and paid to Certificateholders in accordance with Section
7(d)(v), and the excess of the tender offer proceeds over the Call
Price shall be paid to the exercising Warrant Holders pro rata in
respect to their proportionate exercises of Call Warrants or, if the
Call Price exceeds the tender offer proceeds, the amount of such excess
shall be paid by the exercising Warrant Holders pro rata in respect to
their proportionate exercises of Call Warrants.
(iv) If fewer than all tendered Underlying Securities are
accepted for payment and paid for, (A) the amount of Call Warrants
exercised shall be reduced to an amount that corresponds to a number of
Certificates that could be exchanged in an Optional Exchange for the
Underlying Securities accepted for payment and paid for (without regard
to any restrictions on the amount to be exchanged, so long as such
restrictions would have been satisfied had all tendered Underlying
Securities been accepted for payment and paid for); (B) each Warrant
Holder's exercise shall be reduced by its share (proportionate to the
amount specified in its exercise notice) of the amount of Underlying
Securities not accepted for payment and paid for; (C) the Call Price
shall be determined after giving effect to the reduction specified in
clause (B); (D) the Call Warrants that relate to the reduction
specified in clause (B) shall remain outstanding; and (E) the excess of
the tender offer proceeds over the Call Price shall be allocated in
proportion to the amount of Call Warrants deemed exercised as set forth
in clause (A) above or, if the Call Price exceeds the tender offer
proceeds the amount of such excess shall be paid by the exercising
Warrant Holders pro rata in respect to their proportionate exercises of
Call Warrants.
(v) If the tender offer is terminated by the Underlying
Securities Issuer or any other tender offeror without consummation
thereof or if all tenders by the Trust of Underlying Securities are
otherwise rejected, then (1) the Call Notices will be of no further
force and effect, and (2) any Call Warrants relating to such Call
Notices will not be exercised and will remain outstanding.
20
(h)(i) If the Trustee receives notice of a redemption by the Underlying
Securities Issuer for some or all of the 7.25% Underlying Securities and/or
7.375% Underlying Securities, the Trustee shall, within three Business Days,
notify the Warrant Agent and forward to the Warrant Agent copies of all
materials received by the Trustee in connection therewith. Any Warrant Holder
that desires to call the related Underlying Securities in connection with a
redemption by the Underlying Securities Issuer shall send a Call Notice to the
Trustee no later than seven Business Days prior to the date such Underlying
Securities are to be redeemed.
(ii) The Call Date and Optional Exchange Date for any exercise
of Call Warrants in connection with a redemption by the Underlying
Securities Issuer shall be deemed to be the Business Day on which such
Underlying Securities are redeemed by the Underlying Securities Issuer.
(iii) The Call Price shall be deducted from the redemption
proceeds and paid to Certificateholders in accordance with Section
7(d)(v), and the excess of the redemption proceeds over the Call Price
shall be paid to the exercising Warrant Holders pro rata in respect to
their proportionate exercises of Call Warrants.
(iv) If fewer than all Underlying Securities are redeemed by
the Underlying Securities Issuer and the amount of Call Warrants
exercised corresponds to a number of Class A and Class X Certificates
that could be exchanged in an Optional Exchange for a principal amount
of Underlying Securities that exceeds the principal amount of
Underlying Securities actually redeemed, then, unless otherwise
directed by any exercising Warrant Holder, (A) the amount of Call
Warrants exercised shall be reduced to an amount that corresponds to a
number of Class A and Class X Certificates that could be exchanged in
an Optional Exchange for the principal amount of Underlying Securities
redeemed by the Underlying Securities Issuer (without regard to any
restrictions on the amount to be exchanged); (B) each Warrant Holder's
exercise shall be reduced by its share (proportionate to the amount
specified in its exercise notice) of the amount of such excess; (C) the
Call Price shall be determined after giving effect to the reduction
specified in clause (B); (D) the Call Warrants that relate to the
reduction specified in clause (B) shall remain outstanding; and (E) the
excess of the redemption proceeds over the Call Price shall be
allocated in proportion to the amount of Call Warrants deemed exercised
as set forth in clause (A) above.
(v) If the Underlying Securities are not redeemed by the
Underlying Securities Issuer for any reason, then (1) the Call Notices
will be of no further force and effect, and (2) any Call Warrants
relating to such Call Notices will not be exercised and will remain
outstanding.
Section 8. NOTICES OF EVENTS OF DEFAULT.
As promptly as practicable after, and in any event within 30 days
after, the occurrence of any Event of Default with respect to either the 7.375%
Underlying Securities or the 7.25% Underlying Securities actually known to the
Trustee, the Trustee shall give notice of such Event of Default with respect to
such Underlying Securities to the Depository, or, if any Certificates are not
then held by DTC or any other depository, directly to the registered holders of
such
21
Certificates and to the Warrant Agent. However, except in the case of 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.
Section 9. MISCELLANEOUS.
(a) The provisions of Section 4.04, Advances, of the Standard Terms
shall not apply to the USAutos Corporate Backed Series 2004-1 Certificates.
(b) The provisions of Section 4.07, Optional Exchange, of the Standard
Terms shall not apply to the USAutos Corporate Backed Series 2004-1
Certificates.
(c) The Trustee shall simultaneously forward reports to
Certificateholders pursuant to Section 4.03 of the Standard Terms and to the
American Stock Exchange.
(d) Except as expressly provided herein, the Certificateholders shall
not be entitled to terminate the Trust or cause the sale or other disposition of
the Underlying Securities.
(e) The provisions of Section 3.07(d) of the Standard Terms shall not
apply to the USAutos Series 2004-1 Certificates.
(f) 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 X
Certificateholders, pro rata, in proportion to their respective entitlements to
such delayed payments.
(g) The outstanding principal balance, or notional amount, as the case
may be, of the Certificates shall not be reduced by the amount of any Realized
Losses (as defined in the Standard Terms).
(h) The Trust may not engage in any business or activities other than
in connection with, or relating to, the holding, protecting and preserving of
the Trust Property and the issuance of the Certificates and the Call Warrants,
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
Warrants or otherwise incur, assume or guarantee any indebtedness for money
borrowed.
(i) Notwithstanding anything in the Trust Agreement to the contrary,
the Trustee may be removed upon 60 days prior written notice delivered by the
holders of Certificates representing the Required Percentage-Removal.
(j) In the event that the Internal Revenue Service challenges the
characterization of the Trust as a grantor trust, the Trustee shall then file
such forms as the Depositor may specify to establish the Trust's election
pursuant to Section 761 of the Code to exclude the Trust from the
22
application of Subchapter K of the Code and is hereby empowered to execute such
forms on behalf of the Certificateholders.
(k) Notwithstanding anything in the Standard Terms to the contrary, the
Trustee, upon written direction by the Depositor, will execute the Certificates.
(l) In relation to Section 7.01(f) of the Standard Terms, any periodic
reports filed by the Trustee pursuant to the Exchange Act in accordance with the
customary practices of the Depositor, need not contain any independent reports.
(m) Notwithstanding anything in the Trust Agreement to the contrary,
the Trustee will have no recourse to the Underlying Securities.
(n) A Plan fiduciary, whether or not a Certificateholder at such time,
may request in writing that the Trustee provide such Plan fiduciary with such
information as shall be necessary for it to determine whether any of the Call
Warrant holders is (i) a "party in interest" (within the meaning of ERISA,
Section 3(14)); or (ii) a "disqualified person" within the meaning of Internal
Revenue Code ("Code") Section 4975(e)(2) with respect to any employee benefit
plan or Plan identified to the Trustee by such Plan fiduciary at the time such
request is made in order for the Plan fiduciary to determine whether an
investment in the Certificates by such Plan is or would be permissible under
ERISA or the Code. Any such written request of a Plan fiduciary shall be
accompanied by a certification of the Plan fiduciary, opinion of counsel
experienced in such issues, and such other documentation as the Trustee may
require, in order to establish that such disclosure is necessary for the Plan
fiduciary to determine compliance with ERISA and the Code, as well as a
confidentiality agreement, whereby the Plan fiduciary agrees not to disclose the
identity of any Call Warrant holders except to any legal or other experts as
necessary to make such determination. The holder of a Call Warrant shall upon
reasonable request of the Trustee, in order for the Trustee to satisfy its
obligations to a Plan fiduciary, provide the Trustee with any one or more of the
following, in the sole discretion of the Call Warrant holder: (i) a certificate
that each of the Call Warrant holders is not (x) a "party in interest" (within
the meaning of ERISA, Section 3(14)) with respect to any "employee benefit plan"
as defined in ERISA, Section 3(3); or (y) a "disqualified person" within the
meaning of Internal Revenue Code Section 4975(e)(2) with respect to a "Plan" as
defined in Code Section 4975(e)(1) except in each case with respect to plans
sponsored by the Call Warrant holder or its affiliates which cover employees of
the Call Warrant holder and/or such affiliates; (ii) a certificate that each of
the Call Warrant holders is not such a "party in interest" or "disqualified
person" with respect to any employee benefit plan or Plan identified to the
Trustee by such Plan fiduciary at the time such request is made; or (iii) a
written consent to the limited disclosure of the respective Call Warrant
holder's identity to a specific Plan fiduciary solely for purposes of allowing
the Trustee to satisfy its obligations to a Plan fiduciary.
(o) The Trust will not merge or consolidate with any other entity
without confirmation from each Rating Agency that such merger or consolidation
will not result in the qualification, reduction or withdrawal of its
then-current rating on the Certificates.
23
(p) 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:
Amherst Securities Group, L.P.
0000 Xxxxx Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Trustee or the Warrant Agent, to:
U.S. Bank Trust National Association
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Rating Agencies, to:
Xxxxx'x Investors Service, Inc.
00 Xxxxxx Xxxxxx 00X
Xxx Xxxx, Xxx Xxxx 00000
Attention: CBO/CLO Monitoring Department
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and to:
Standard & Poor's Ratings Services
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Structured Finance Surveillance Group
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Copies of all directions, demands and notices required to be given to
the Certificateholders hereunder or under the Standard Terms will also be given
to the Warrant Holders in writing as set forth in this Section 9, and copies of
all directions, demands and notices required to be given to the Trustee
hereunder or under the Standard Terms will also be given to the Warrant Agent in
writing as set forth in this Section 9(p).
(q) Each of the representations, covenants and agreements made herein
by each of the Depositor and the Trustee are for the benefit of the
Certiticateholders and the Warrant Holders.
24
(r) The provisions of Section 2.01(d) (iii) of the Standard Terms shall
not apply to the USAutos Corporate Backed Series 2004-1 Certificates and the
following shall be deemed to be inserted in its place:
"at the time of delivery of the Underlying Securities, the
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;
and"
(s) Upon the instruction of the Depositor, the Trustee shall appoint a
firm of independent certified public accountants to review each of the
distribution reports prepared by the Trustee pursuant to Section 4.03 of the
Standard Terms and to verify (x) that such reports and the calculations made
therein were made accurately and in accordance with the terms of the Trust
Agreement and (y) that the Depositor and the Trustee have each fulfilled their
obligations under this Trust Agreement. The Trustee shall instruct the
accountants (i) to promptly report to the Trustee any errors in such
distribution reports discovered in verifying such calculations and (ii) to
render to the Trustee an annual examination report, prepared in compliance with
established or stated criteria as set forth in the professional standards of the
Public Company Accounting Oversight Board, within 45 days (or such longer period
as may be acceptable to the Trustee) following the end of each calendar year
that specifies the calculations made in reviewing the distribution reports
prepared by the Trustee for the previous calendar year and such accountants'
associated findings.
Section 10. GOVERNING LAW. THIS SERIES SUPPLEMENT AND THE TRANSACTIONS
DESCRIBED HEREIN SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED WITHIN
THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CHOICE OF LAWS PROVISIONS
THEREOF (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW).
Section 11. COUNTERPARTS. This Series Supplement may be executed in any
number of counterparts, each of which shall be deemed to be an original, and all
such counterparts shall constitute but one and the same instrument.
Section 12. TERMINATION OF THE TRUST. The Trust shall terminate upon
the earliest to occur of (i) the payment in full at maturity or sale by the
Trust after a payment default, call or an acceleration or other early payment of
the Underlying Securities and the distribution in full of all amounts due to the
Class A Certificateholders and Class X Certificateholders; (ii) the exercise of
all outstanding Call Warrants by the Warrant Holder; (iii) the final scheduled
Distribution Date and (iv) 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.
Section 13. SALE OF UNDERLYING SECURITIES; OPTIONAL EXCHANGE. In the
event of a sale of the Underlying Securities pursuant to this Agreement or
pursuant to the instructions of the Warrant Agent under Section 1.2 of the
Warrant Agent Agreement, the Trustee shall solicit bids for the sale of the
Underlying Securities with settlement thereof on or before the third Business
25
Day after such sale from three leading dealers in the relevant market. Any of
the following dealers (or their successors) shall be deemed to qualify as
leading dealers: (1) Credit Suisse First Boston LLC, (2) Xxxxxxx, Xxxxx & Co.,
(3) Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated, (4) UBS Securities LLC,
(5) Citigroup Global Markets Inc., and (6) except in the case of a sale related
to the exercise of Call Warrants by the Depositor or any Affiliate thereof,
Amherst Securities Group, L.P. The Trustee shall not be responsible for the
failure to obtain a bid so long as it has made reasonable efforts to obtain
bids. If a bid for the sale of the Underlying Securities has been accepted by
the Trustee but the sale has failed to settle on the proposed settlement date,
the Trustee shall request new bids from such leading dealers. In the event of an
Optional Exchange, the Trustee shall only deliver the Underlying Securities to
the purchaser of such Underlying Securities or sell the Underlying Securities
pursuant to this Section 13, as the case may be, against payment in same day
funds deposited into the Certificate Account.
Section 14. AMENDMENTS. Notwithstanding anything in the Trust Agreement
to the contrary, in addition to the other restrictions on modification and
amendment contained therein, the Trustee shall not enter into any amendment or
modification of the Trust Agreement which would adversely affect in any material
respect the interests of the holders of any class of Certificates without the
consent of the holders of 100% of such class of Certificates; provided, however,
that no such amendment or modification will be permitted which would cause the
Trust to be taxed as an association or publicly traded partnership taxable as a
corporation for federal income tax purposes. Unless otherwise agreed, the
Trustee shall provide five Business Days written notice to each Rating Agency
before entering into any amendment or modification of the Trust Agreement
pursuant to this Section 14.
Section 15. VOTING OF UNDERLYING SECURITIES, MODIFICATION OF INDENTURE.
(a) 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 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 as the Voting Rights 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;
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) cause the
Trust to be taxed as an association or publicly traded partnership taxable as a
corporation under the Code, (ii) which 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
26
the Underlying Securities or an event which with the passage of time would
become an event of default under the Underlying Securities and with the
unanimous consent of Certificateholders representing 100% of the aggregate
Voting Rights and 100% of the Warrant Holders, or (iii) which 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 Indenture and only with
the consent of Certificateholders representing 100% of the aggregate Voting
Rights and 100% of the Warrant Holders. The Trustee shall have no liability for
any failure to act resulting from Certificateholders' late return of, or failure
to return, directions requested by the Trustee from the Certificateholders.
(b) In the event that 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 Class A Certificateholders,
Class X Certificateholders and the Warrant Holders of such offer promptly.
Subject to the rights of the Warrant Holders to exercise Call Warrants in
connection with a tender offer for the Underlying Securities, the Trustee must
reject any such offer unless an event of default has occurred on the related
Underlying Securities and the Trustee is directed by the affirmative vote of the
holders of 100% of the Certificates and Call Warrants to accept such offer and
the Trustee has received the tax opinion described above. If pursuant to the
preceding sentence, the Trustee accepts any such offer the Trustee shall
promptly notify the Rating Agencies.
(c) If an event of default under the Indenture occurs and is
continuing, and if directed by a majority of the outstanding Class A
Certificateholders and Class X 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 16. ADDITIONAL DEPOSITOR REPRESENTATION. It is the express
intent of the parties hereto that the conveyance of the Underlying Securities by
the Depositor to the Trustee be, and be construed as, a sale of the Underlying
Securities by the Depositor and not a pledge of any Underlying Securities by the
Depositor to secure a debt or other obligation of the Depositor. In the event
that, notwithstanding the aforementioned intent of the parties, any Underlying
Securities are held to be property of the Depositor, then, it is the express
intent of the parties that such conveyance be deemed a pledge of such Underlying
Securities and all proceeds thereof by the Depositor to the Trustee to secure a
debt or other obligation of the Depositor, pursuant to Section 10.07 of the
Standard Terms. In connection with any such grant of a security interest in the
Underlying Securities and all proceeds thereof (including any such grant in
connection with any sale of additional Underlying Securities pursuant to Section
3(d)), the Depositor hereby represents and warrants to Trustee as follows:
(i) In the event the Underlying Securities are held to be property of the
Depositor, then the Trust Agreement creates a valid and continuing
security interest (as defined in the UCC) in the Underlying Securities
in favor of the Securities Intermediary which security interest is
prior to all other liens, and is enforceable as such as against
creditors of, and purchasers from, the Depositor.
27
(ii) The Underlying Securities have been credited to a trust account (the
"Securities Account") established in the name of the Trustee in
accordance with Section 2.01 of the Standard Terms. U.S. Bank Trust
National Association, as securities intermediary (the "Securities
Intermediary") has established the Securities Account and has agreed to
treat the Underlying Securities as "financial assets" within the
meaning of the UCC.
(iii) Immediately prior to the transfer of the Underlying Securities to the
Trust, the Depositor owned and had good and marketable title to the
Underlying Securities free and clear of any lien, claim or encumbrance
of any Person.
(iv) The Depositor has received all consents and approvals required by the
terms of the Underlying Securities for the transfer to the Trustee all
of the Depositor's interest and rights in the Underlying Securities as
contemplated by the Trust Agreement.
(v) The Depositor has taken all steps necessary to cause the Securities
Intermediary to identify on its records that the Trustee is the Person
owning the security entitlements credited to the Securities Account.
(vi) Other than the security interest granted to the Trust pursuant to this
Agreement, the Depositor has not assigned, pledged, sold, granted a
security interest in or otherwise conveyed any interest in the
Underlying Securities (or, if any such interest has been assigned,
pledged or otherwise encumbered, it has been released). The Depositor
has not authorized the filing of and is not aware of any financing
statements against the Depositor that include a description of the
Underlying Securities other than any financing statement relating to
the security interest granted to the Trust hereunder. The Depositor is
not aware of any judgment or tax lien filings against the Depositor.
(vii) The Securities Account is not in the name of any Person other than the
Trustee. The Depositor has not consented to the compliance by the
Securities Intermediary, with entitlement orders of any Person other
than the Trustee.
28
IN WITNESS WHEREOF, the parties hereto have caused this Series Supplement to be
duly executed by their respective authorized officers as of the date first
written above.
FREEDOM DEPOSITORY, LLC,
as Depositor
By: ASG GENERAL PARTNER, INC.
its Manager
By: /s/ Xxxx X. Xxxxxx
------------------------
Name: Xxxx X. Xxxxxx
Title: President
U.S. BANK TRUST NATIONAL
ASSOCIATION, not in its
individual capacity but solely
as Trustee on behalf of the
USAutos Series 2004-1 Trust
By: /s/ Xxxxxxx Xxxxx
--------------------------------
Name: Xxxxxxx Xxxxx
Title: Vice President
SCHEDULE I
USAUTOS SERIES 2004-1
UNDERLYING SECURITIES SCHEDULE
7.375% Underlying Securities
----------------------------
Underlying Securities: 7.375% Notes due 2011.
Underlying Securities Issuer: Ford Motor Credit Company.
CUSIP Number: 345397ts2.
Principal Amount Deposited: $2,000,000.
Original Issue Date: April 20, 2001.
Principal Amount of $1,000,000,000.
Underlying Securities
Originally Issued:
Maturity Date: February 1, 2011.
Interest Rate: 7.375% per annum.
Interest Payment Dates: February 1st and August 1st.
Ratings: "BBB-" by Standard & Poor's Ratings Services,
a division of The XxXxxx-Xxxx Companies, Inc.
"A3" by Xxxxx'x Investors Service, Inc.
7.25% Underlying Securities
---------------------------
Underlying Securities: 7.25% Notes due 2011.
Underlying Securities Issuer: General Motors Acceptance Corporation.
CUSIP Number: 00000xx0.
Principal Amount Deposited: $2,000,000.
Original Issue Date: March 2, 2001.
Principal Amount of $2,000,000,000.
Underlying Securities
Originally Issued:
Maturity Date: March 2, 2011.
Interest Rate: 7.25% per annum.
Interest Payment Dates: March 2nd and September 2nd.
Ratings: "BBB-" by Standard & Poor's Ratings Services,
a division of The XxXxxx-Xxxx Companies, Inc.
"A3" by Xxxxx'x Investors Service, Inc.
EXHIBIT A-1
CLASS A CERTIFICATE
NUMBER 1 4,000 $1,000 PAR CERTIFICATES
CUSIP NUMBER: 35637V AB 4
ISIN NUMBER : US35637VAB45
SEE REVERSE FOR CERTAIN DEFINITIONS
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE REPRESENTS A PROPORTIONATE UNDIVIDED BENEFICIAL OWNERSHIP
INTEREST IN THE TRUST AND DOES NOT EVIDENCE AN OBLIGATION OF, OR AN INTEREST IN,
AND IS NOT GUARANTEED BY THE DEPOSITOR OR THE TRUSTEE OR ANY OF THEIR RESPECTIVE
AFFILIATES. NEITHER THIS CERTIFICATE NOR THE TRUST ASSETS ARE INSURED OR
GUARANTEED BY ANY GOVERNMENTAL AGENCY OR ANY OTHER PERSON.
THE CERTIFICATEHOLDERS, BY THEIR ACCEPTANCE OF CERTIFICATES, COVENANT AND AGREE
TO TENDER ANY AND ALL CALLED CERTIFICATES TO THE TRUSTEE UPON THE WARRANT
HOLDER'S EXERCISE OF CALL WARRANTS AND PAYMENT OF THE CALL PRICE FOR SUCH
CERTIFICATES IN ACCORDANCE WITH THE PROVISIONS HEREOF AND OF THE WARRANT AGENT
AGREEMENT.
AMHERST SECURITIES GROUP, L.P.
4,000 $1,000 PAR CERTIFICATES
FREEDOM CERTIFICATES(SM),
USAUTOS SERIES 2004-1
5.10% INTEREST RATE
FINAL SCHEDULED DISTRIBUTION DATE: March 3, 2011
evidencing a proportionate undivided beneficial ownership interest in the Trust,
as defined below, the property of which consists principally of $2,000,000
aggregate principal amount of 7.375% Notes due February 1, 2011, issued by Ford
Motor Credit Company ("Ford") and $2,000,000 aggregate principal amount of 7.25%
Notes due March 2, 2011, issued by General Motors Acceptance Corporation
("GMAC"), and all payments on or collections in respect of the Underlying
Securities received (the "Trust Property"), deposited in trust by Freedom
Depository, LLC (the "Depositor").
THIS CERTIFIES THAT CEDE & CO. is the registered owner of an aggregate of
$4,000,000 DOLLARS nonassessable, fully-paid, proportionate undivided beneficial
ownership interest in the USAutos Series 2004-1 Trust, formed by the Depositor.
The Trust was created pursuant to a Standard Terms for Trust Agreements, dated
as of October 1, 2004 (the "Standard Terms"), between the Depositor and U.S.
Bank Trust National Association, a national banking association, not in its
individual capacity but solely as Trustee (the "Trustee"), as supplemented by
the Series Supplement in respect of the USAutos Series 2004-1, dated as of
October 1, 2004 (the "Series Supplement" and, together with the Standard Terms,
the "Trust Agreement"), between the Depositor and the Trustee. This Certificate
does not purport to summarize the Trust Agreement and reference is hereby made
to the Trust Agreement for information with respect to the interests, rights,
benefits, obligations, proceeds and duties evidenced hereby and the rights,
duties and obligations of the Trustee with respect hereto. A copy of the Trust
Agreement may be obtained from the Trustee by written request sent to the
Corporate Trust Office. Capitalized terms used but not defined herein have the
meanings assigned to them in the Trust Agreement.
This Certificate is one of the duly authorized Certificates designated as the
"Freedom Certificates(SM), USAutos Series 2004-1" (herein called the
"Certificates"). This Certificate is issued under and is subject to the terms,
provisions and conditions of the Trust Agreement, to which Trust Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound. The Trust Property consists of: (i) Underlying
Securities described in the Trust Agreement, and (ii) all payments on or
collections in respect of the Underlying Securities accrued on or after October
28, 2004, together with any and all income, proceeds and payments with respect
thereto.
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 of interest will be made on this
Certificate on each Distribution Date.
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 proportionate undivided beneficial ownership interest
in the amount required to be distributed to the holders of the Certificates on
such Distribution Date. The Record Date applicable to any Distribution Date is
the close of business on the day immediately preceding such Distribution Date
(whether or not a Business Day). If a payment with respect to the Underlying
Securities is made to the Trustee after the date on which such payment was due,
then the Trustee will distribute any such amounts received on the next occurring
Business Day.
Each Certificateholder, by its acceptance of a Certificate, covenants and agrees
that such Certificateholder will not at any time institute against the Trust, or
join in any institution against the Trust of, any bankruptcy proceedings under
any United States Federal or state bankruptcy or similar law in connection with
any obligations relating to the Certificates or the Trust Agreement.
Distributions made on this Certificate will be made as provided in the Trust
Agreement by the Trustee by wire transfer in immediately available funds, or
check mailed to the Certificateholder of record in the Certificate Register
without the presentation or surrender of this Certificate or the making of any
notation hereon, except that with respect to Certificates registered on the
Record Date in the name of the nominee of the Clearing Agency (initially, such
nominee shall be Cede & Co.), payments will be made by wire transfer in
immediately available funds to the account designated by such nominee. Except as
otherwise provided in the Trust Agreement and notwithstanding the above, the
final distribution on this Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the Corporate Trust Office or such other
location as may be specified in such notice.
Reference is hereby made to the further provisions of this Certificate set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee, by manual signature, this Certificate shall not entitle
the Holder hereof to any benefit under the Trust Agreement or be valid for any
purpose.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE HOLDER HEREOF SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed
as of the date set forth below.
USAUTOS SERIES 2004-1 TRUST
By: U.S. BANK TRUST NATIONAL ASSOCIATION
not in its individual capacity
but solely as Trustee.
By:
---------------------------------------
Authorized Signatory
Dated: October 28, 2004
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Freedom Certificates(SM), USAutos Series 2004-1, described in
the Trust Agreement referred to herein.
U.S. BANK TRUST NATIONAL ASSOCIATION not in its individual capacity but solely
as Trustee,
By:
--------------------------------------------
Authorized Signatory
(REVERSE OF CERTIFICATE)
The Certificates are limited in right of distribution to certain payments and
collections respecting the Underlying Securities, all as more specifically set
forth herein and in the Trust Agreement. The registered Holder hereof, by its
acceptance hereof, agrees that it will look solely to the Trust Property (to the
extent of its rights therein) for distributions hereunder.
The Trust Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor and the Trustee and the rights of the Certificateholders under the
Trust Agreement at any time by the Depositor and the Trustee with the consent of
the holders of Class A Certificates in the manner set forth in the Series
Supplement and the Standard Terms. Any such consent by the Holder of this
Certificate (or any predecessor Certificate) shall be conclusive and binding on
such Holder and upon all future holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange hereof or in lieu
hereof whether or not a 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.
The Certificates are issuable in fully registered form only in denominations of
$1,000.
As provided in the Trust Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registerable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies of the Certificate Registrar maintained by the Trustee in
the Borough of Manhattan, the City of New York, duly endorsed by or accompanied
by an assignment in the form below and by such other documents as required by
the Trust Agreement, and thereupon one or more new Certificates of the same
class in authorized denominations evidencing the same principal amount will be
issued to the designated transferee or transferees. The initial Certificate
Registrar appointed under the Trust Agreement is U.S. Bank Trust National
Association.
No service charge will be made for any registration of transfer or exchange, but
the Trustee may require exchange of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.
The Depositor and the Trustee and any agent of the Depositor or the Trustee may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and neither the Depositor, the Trustee, nor any such
agent shall be affected by any notice to the contrary.
It is the intention of the parties to the Trust Agreement that the Trust created
thereunder shall constitute a fixed investment trust for federal income tax
purposes under Treasury Regulation Section 301.7701-4, and the Certificateholder
agrees to treat the Trust, any distributions therefrom and its beneficial
interest in the Certificates consistently with such characterization.
The Trust and the obligations of the Depositor and the Trustee created by the
Trust Agreement with respect to the Certificates shall terminate upon the
earliest to occur of (i) the 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 to the
Class A Certificateholders and Class X Certificateholders; (ii) the exercise of
all outstanding Call
Warrants by the Warrant holders; (iii) the Final Scheduled Distribution Date and
(iv) the expiration of 21 years from the death of the last survivor of the
descendants of Xxxxxx X. Xxxxxxx, the late Ambassador of the United States to
the Court of St. Xxxxx, living on the date hereof.
An employee benefit plan subject to the Employee Retirement Income Security Act
of 1974, as amended ("ERISA"), a plan described in Section 4975(e) of the Code,
an entity whose underlying assets include plan assets by reason of any such
plan's investment in the entity, including an individual retirement account or
Xxxxx plan (any such, a "Plan") may purchase and hold Certificates if the Plan
can represent and warrant that its purchase and holding of the Certificates
would not be prohibited under ERISA or the Code.
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
(Please print or type name and address, including postal zip code, of assignee)
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing ______________________ Attorney to transfer said
Certificate on the books of the Certificate Register, with full power of
substitution in the premises.
Dated:
*
Signature Guaranteed:
*
*NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Signatures must be guaranteed by
an "eligible guarantor institution" meeting the requirements of the Certificate
Registrar, which requirements include membership or participation in the
Security Transfer Agent Medallion Program ("STAMP") or such other "signature
guarantee program" as may be determined by the Certificate Registrar in addition
to, or in substitution for, STAMP, all in accordance with the Securities
Exchange Act of 1934, as amended.
SCHEDULE I
USAUTOS SERIES 2004-1
UNDERLYING SECURITIES SCHEDULE
7.375% Underlying Securities
----------------------------
Underlying Securities: 7.375% Notes due 2011.
Underlying Securities Issuer: Ford Motor Credit Company.
CUSIP Number: 345397ts2.
Principal Amount Deposited: $2,000,000.
Original Issue Date: April 20, 2001.
Principal Amount of $1,000,000,000.
Underlying Securities
Originally Issued:
Maturity Date: February 1, 2011.
Interest Rate: 7.375% per annum.
Interest Payment Dates: February 1st and August 1st.
Ratings: "BBB-" by Standard & Poor's Ratings Services,
a division of The XxXxxx-Xxxx Companies, Inc.
"A3" by Xxxxx'x Investors Service, Inc.
7.25% Underlying Securities
---------------------------
Underlying Securities: 7.25% Notes due 2011.
Underlying Securities Issuer: General Motors Acceptance Corporation.
CUSIP Number: 00000xx0.
Principal Amount Deposited: $2,000,000.
Original Issue Date: March 2, 2001.
Principal Amount of $2,000,000,000.
Underlying Securities
Originally Issued:
Maturity Date: March 2, 2011.
Interest Rate: 7.25% per annum.
Interest Payment Dates: March 2nd and September 2nd.
Ratings: "BBB-" by Standard & Poor's Ratings Services,
a division of The XxXxxx-Xxxx Companies, Inc.
"A3" by Xxxxx'x Investors Service, Inc.
EXHIBIT A-2
CLASS X CERTIFICATE
NUMBER 1
SEE REVERSE FOR CERTAIN DEFINITIONS
THIS CLASS X CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE TRANSFERRED, SOLD OR
OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION UNDER SUCH ACT IS IN EFFECT OR
PURSUANT TO AN EXEMPTION THEREFROM UNDER SUCH ACT. THE CLASS X CERTIFICATE
REPRESENTED HEREBY MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF THE
SERIES SUPPLEMENT.
EACH PURCHASER OF THIS CLASS X CERTIFICATE IS HEREBY NOTIFIED THAT THE SELLER OF
THIS CLASS X CERTIFICATE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF
SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE NOTIONAL AMOUNT OF THIS CLASS X CERTIFICATE IS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING NOTIONAL AMOUNT OF THIS CLASS X CERTIFICATE AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
THIS CERTIFICATE REPRESENTS A PROPORTIONATE UNDIVIDED BENEFICIAL OWNERSHIP
INTEREST IN THE TRUST AND DOES NOT EVIDENCE AN OBLIGATION OF, OR AN INTEREST IN,
AND IS NOT GUARANTEED BY THE DEPOSITOR OR THE TRUSTEE OR ANY OF THEIR RESPECTIVE
AFFILIATES. NEITHER THIS CERTIFICATE NOR THE TRUST ASSETS ARE INSURED OR
GUARANTEED BY ANY GOVERNMENTAL AGENCY OR ANY OTHER PERSON.
THE CERTIFICATEHOLDERS, BY THEIR ACCEPTANCE OF CERTIFICATES, COVENANT AND AGREE
TO TENDER ANY AND ALL CALLED CERTIFICATES TO THE TRUSTEE UPON THE WARRANT
HOLDER'S EXERCISE OF CALL WARRANTS AND PAYMENT OF THE CALL PRICE FOR SUCH
CERTIFICATES IN ACCORDANCE WITH THE PROVISIONS HEREOF AND OF THE WARRANT AGENT
AGREEMENT.
AMHERST SECURITIES GROUP, L.P.
FREEDOM CERTIFICATES(SM),
USAUTOS SERIES 2004-1
$4,000,000 NOTIONAL AMOUNT
2.2125% INITIAL INTEREST RATE
FINAL SCHEDULED DISTRIBUTION DATE: March 3, 2011
evidencing a proportionate undivided beneficial ownership interest in
the Trust, as defined below, the property of which consists principally of
$2,000,000 aggregate principal amount of 7.375% Notes due February 1, 2011,
issued by Ford Motor Credit Company ("Ford") and $2,000,000 aggregate principal
amount of 7.25% Notes due March 2, 2011, issued by General Motors Acceptance
Corporation ("GMAC"), and all payments on or collections in respect of the
Underlying Securities received (the "Trust Property"), deposited in trust by
Freedom Depository, LLC(the "Depositor").
THIS CERTIFIES THAT Amherst Funding Group, L.P., 0000 Xxxxx Xxxxxxx xx Xxxxx
Xxxxxxx Xxxxx 000X, Xxxxxx, Xxxxx 00000, is the registered owner of an aggregate
of $4,000,000 DOLLARS notional amount nonassessable, fully-paid, proportionate
undivided beneficial ownership interest in the USAutos Series 2004-1 Trust,
formed by the Depositor. The Trust was created pursuant to a Standard Terms for
Trust Agreements, dated as of October 1, 2004 (the "Standard Terms"), between
the Depositor and U.S. Bank Trust National Association , a national banking
association, not in its individual capacity but solely as Trustee (the
"Trustee"), as supplemented by the Series Supplement, USAutos Series 2004-1,
dated as of October 28, 2004 (the "Series Supplement" and, together with the
Standard Terms, the "Trust Agreement"), between the Depositor and the Trustee.
This Certificate does not purport to summarize the Trust Agreement and reference
is hereby made to the Trust Agreement for information with respect to the
interests, rights, benefits, obligations, proceeds and duties evidenced hereby
and the rights, duties and obligations of the Trustee with respect hereto. A
copy of the Trust Agreement may be obtained from the Trustee by written request
sent to the Corporate Trust Office. Capitalized terms used but not defined
herein have the meanings assigned to them in the Trust Agreement.
This Certificate is one of the duly authorized Certificates designated as the
"Freedom Certificates(SM), USAutos Series 2004-1" (herein called the
"Certificates"). This Certificate is issued under and is subject to the terms,
provisions and conditions of the Trust Agreement, to which Trust Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound. The Trust Property consists of: (i) Underlying
Securities described in the Trust Agreement, and (ii) all payments on or
collections in respect of the Underlying Securities accrued on or after October
28, 2004, together with any and all income, proceeds and payments with respect
thereto.
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 of
interest will be made on this Certificate on each Distribution Date.
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 proportionate undivided beneficial ownership interest
in the amount required to be distributed to the holders of the Certificates on
such Distribution Date. The Record Date applicable to any Distribution Date is
the close of business on the day immediately preceding such Distribution Date
(whether or not a Business Day). If a payment with respect to the Underlying
Securities is made to the Trustee after the date on which such payment was due,
then the Trustee will distribute any such amounts received on the next occurring
Business Day.
Each Certificateholder, by its acceptance of a Certificate, covenants and agrees
that such Certificateholder will not at any time institute against the Trust, or
join in any institution against the Trust of, any bankruptcy proceedings under
any United States Federal or state bankruptcy or similar law in connection with
any obligations relating to the Certificates or the Trust Agreement.
Distributions made on this Certificate will be made as provided in the Trust
Agreement by the Trustee by wire transfer in immediately available funds, or
check mailed to the Certificateholder of record in the Certificate Register
without the presentation or surrender of this Certificate or the making of any
notation hereon. Except as otherwise provided in the Trust Agreement and
notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the Corporate Trust
Office or such other location as may be specified in such notice.
Reference is hereby made to the further provisions of this Certificate set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee, by manual signature, this Certificate shall not entitle
the Holder hereof to any benefit under the Trust Agreement or be valid for any
purpose.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE HOLDER HEREOF SHALL
BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed
as of the date set forth below.
USAUTOS SERIES 2004-1 TRUST
By: U.S. BANK TRUST NATIONAL ASSOCIATION
not in its individual capacity but
solely as Trustee.
By:
-------------------------------------
Authorized Signatory
Dated: October 28, 2004
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Freedom Certificates(SM), USAutos Series 2004-1, described in
the Trust Agreement referred to herein.
U.S. BANK TRUST NATIONAL ASSOCIATION
not in its individual capacity but solely
as Trustee,
By:
---------------------------------------
Authorized Signatory
(REVERSE OF CERTIFICATE)
The Certificates are limited in right of distribution to certain payments and
collections respecting the Underlying Securities, all as more specifically set
forth herein and in the Trust Agreement. The registered Holder hereof, by its
acceptance hereof, agrees that it will look solely to the Trust Property (to the
extent of its rights therein) for distributions hereunder.
The Trust Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor and the Trustee and the rights of the Certificateholders under the
Trust Agreement at any time by the Depositor and the Trustee with the consent of
the holders of Class X Certificates in the manner set forth in the Series
Supplement and the Standard Terms. Any such consent by the Holder of this
Certificate (or any predecessor Certificate) shall be conclusive and binding on
such Holder and upon all future holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange hereof or in lieu
hereof whether or not notation of such consent 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.
The Certificates are issuable in fully registered form only in minimum
denominations of $100,000 and in integral multiples of $1 in excess thereof.
As provided in the Trust Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registerable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies of the Certificate Registrar maintained by the Trustee in
the Borough of Manhattan, the City of New York, duly endorsed by or accompanied
by an assignment in the form below and by such other documents as required by
the Trust Agreement, and thereupon one or more new Certificates of the same
class in authorized denominations evidencing the same notional amount will be
issued to the designated transferee or transferees. The initial Certificate
Registrar appointed under the Trust Agreement is U.S. Bank Trust National
Association.
No service charge will be made for any registration of transfer or exchange, but
the Trustee may require exchange of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.
The Depositor and the Trustee and any agent of the Depositor or the Trustee may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and neither the Depositor, the Trustee, nor any such
agent shall be affected by any notice to the contrary.
It is the intention of the parties to the Trust Agreement that the Trust created
thereunder shall constitute a fixed investment trust for federal income tax
purposes under Treasury Regulation Section 301.7701-4, and the Certificateholder
agrees to treat the Trust, any distributions therefrom and its beneficial
interest in the Certificates consistently with such characterization.
The Trust and the obligations of the Depositor and the Trustee created by the
Trust Agreement with respect to the Certificates shall terminate upon the
earliest to occur of (i) the 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 to the
Class
A Certificateholders and Class X Certificateholders; (ii) the exercise of all
outstanding Call Warrants by the Warrant holders; (iii) the Final Scheduled
Distribution Date and (iv) 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 Xx. Xxxxx, living on the date hereof.
An employee benefit plan subject to the Employee Retirement Income Security Act
of 1974, as amended ("ERISA"), a plan described in Section 4975(e) of the Code,
an entity whose underlying assets include plan assets by reason of any such
plan's investment in the entity, including an individual retirement account or
Xxxxx plan (any such, a "Plan") may purchase and hold Certificates if the Plan
can represent and warrant that its purchase and holding of the Certificates
would not be prohibited under ERISA or the Code.
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
(Please print or type name and address, including postal zip code, of assignee)
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing ________________________________ Attorney to
transfer said Certificate on the books of the Certificate Register, with full
power of substitution in the premises.
Dated:
*
Signature Guaranteed:
*
*NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Signatures must be guaranteed by
an "eligible guarantor institution" meeting the requirements of the Certificate
Registrar, which requirements include membership or participation in the
Security Transfer Agent Medallion Program ("STAMP") or such other "signature
guarantee program" as may be determined by the Certificate Registrar in addition
to, or in substitution for, STAMP, all in accordance with the Securities
Exchange Act of 1934, as amended.
SCHEDULE I
USAUTOS SERIES 2004-1
UNDERLYING SECURITIES SCHEDULE
7.375% Underlying Securities
----------------------------
Underlying Securities: 7.375% Notes due 2011.
Underlying Securities Issuer: Ford Motor Credit Company.
CUSIP Number: 345397ts2.
Principal Amount Deposited: $2,000,000.
Original Issue Date: April 20, 2001.
Principal Amount of $1,000,000,000.
Underlying Securities
Originally Issued:
Maturity Date: February 1, 2011.
Interest Rate: 7.375% per annum.
Interest Payment Dates: February 1st and August 1st.
Ratings: "BBB-" by Standard & Poor's Ratings Services,
a division of The XxXxxx-Xxxx Companies, Inc.
"A3" by Xxxxx'x Investors Service, Inc.
7.25% Underlying Securities
---------------------------
Underlying Securities: 7.25% Notes due 2011.
Underlying Securities Issuer: General Motors Acceptance Corporation.
CUSIP Number: 00000xx0.
Principal Amount Deposited: $2,000,000.
Original Issue Date: March 2, 2001.
Principal Amount of $2,000,000,000.
Underlying Securities
Originally Issued:
Maturity Date: March 2, 2011.
Interest Rate: 7.25% per annum.
Interest Payment Dates: March 2nd and September 2nd.
Ratings: "BBB-" by Standard & Poor's Ratings Services,
a division of The XxXxxx-Xxxx Companies, Inc.
"A3" by Xxxxx'x Investors Service, Inc.
EXHIBIT B
WARRANT AGENT AGREEMENT
FREEDOM CERTIFICATES(SM)
USAUTOS SERIES 2004-1 TRUST
WARRANT AGENT AGREEMENT, dated as of October 28, 2004 (the "WARRANT
AGENT AGREEMENT"), by and between FREEDOM DEPOSITORY, LLC, as depositor (the
"DEPOSITOR"), U.S. BANK TRUST NATIONAL ASSOCIATION, as not in its individual
capacity but solely as trustee (the "TRUSTEE") and U.S. BANK TRUST NATIONAL
ASSOCIATION, as Warrant Agent (the "WARRANT AGENT").
W I T N E S S E T H:
WHEREAS, the Depositor created USAutos Series 2004-1 Trust (the
"TRUST"), a trust created under the laws of the State of New York pursuant to a
Standard Terms for Trust Agreements, dated as of October 1, 2004 (the "STANDARD
TERMS"), between Freedom Depository (the "DEPOSITOR") and U.S. Bank Trust
National Association, a national banking association, not in its individual
capacity but solely as trustee (the "TRUSTEE"), as supplemented by the Series
Supplement 2004-1, dated as of October 28, 2004 (the "SERIES SUPPLEMENT" and,
together with the Standard Terms, the "TRUST AGREEMENT"), between the Depositor
and the Trustee; and
WHEREAS, in connection with the creation of the Trust and the deposit
therein of the Underlying Securities, it is desired to provide for the issuance
of trust certificates (the "CERTIFICATES") evidencing undivided interests in the
Trust and call warrants with respect to the Certificates ("CALL WARRANTS").
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants expressed herein, it is hereby agreed by and between the
Depositor, the Warrant Agent and the Trustee that except as otherwise specified
herein or as the context may otherwise require, capitalized terms used herein
but not defined herein shall have the respective meanings set forth below in the
Series Supplement, and as follows:
ARTICLE I
EXERCISE OF CALL WARRANTS
Section 1.1 MANNER OF EXERCISE.
(a) Call Warrants may be exercised by any holder thereof (each, a
"WARRANT HOLDER") in whole or in part on any Call Date. The following conditions
shall apply to any exercise of Call Warrants:
(i) A notice (each, a "CALL NOTICE") specifying that all,
but not less than all the Call Warrants are being exercised and the
Call Date shall be delivered to the Warrant
Agent and the Trustee at least five (5) Business Days before such Call
Date.
(ii) The Warrant Holder shall surrender the Call Warrants
to the Warrant Agent at its office specified in Section 7.3 hereof no
later than 10:00 a.m. (New York City time) on such Call Date.
(iii) Except as otherwise provided herein in connection
with a Call Notice relating to a tender offer for or redemption of
Underlying Securities, the Warrant Holder shall have made payment to
the Warrant Agent, by wire transfer or other immediately available
funds acceptable to the Warrant Agent, in the amount of the Call Price,
no later than 10:00 a.m. (New York City time) on the Call Date.
(iv) The Warrant Holder may not exercise the Call Warrants
at any time when such Warrant Holder is insolvent, and such Warrant
Holder shall be required to certify that it is solvent at the time of
exercise, by completing the form of subscription ("FORM OF
SUBSCRIPTION") attached to the Call Warrants and delivering such
completed Form of Subscription to the Trustee on or prior to the Call
Date and by delivering to the Trustee a form reasonably satisfactory to
the Trustee of the solvency certificate required pursuant to Section
7(d)(ii) of the Series Supplement.
(v) The Warrant Holder shall have satisfied all
conditions to the exercise of the Call Warrants set forth in Section
7(d) of the Series Supplement.
(b) Upon exercise of the Call Warrants, any Warrant Holder other
than the Depositor or any Affiliate of the Depositor shall be entitled to
delivery by the Trustee of the Called Certificates. The "CALLED CERTIFICATES"
shall be, in the case of the Class A Certificates, Class A Certificates having a
Certificate Principal Balance equal to $1,000 per Call Warrant, and in the case
of the Class X Certificates, Class X Certificates having a notional balance
equal to $4,000,000 per Call Warrant; provided, however, that Called
Certificates must meet the minimum denomination requirements set forth in
Section 3(a) of the Series Supplement. Unless otherwise specified therein, each
Call Notice shall be deemed to be notice of an Optional Exchange pursuant to
Section 7(b) of the Series Supplement; it being expressly understood that any
Optional Exchange must comply with provisions of Section 7(a) and 7(b) of the
Series Supplement. Any Warrant Holder which is the Depositor or any Affiliate of
the Depositor shall receive the proceeds of the sale of the Called Underlying
Securities and shall not be entitled to receive the related Called Certificates
or Called Underlying Securities. "CALLED UNDERLYING SECURITIES" are (i) 7.375%
Underlying Securities which represent the same percentage of the 7.375%
Underlying Securities as the Called Certificates represent of the Class A
Certificates and the Class X Certificates and (ii) 7.25% Underlying Securities
which represent the same percentage of the 7.25% Underlying Securities as the
Called Certificates represent of the Class A Certificates and the Class X
Certificates.
(c) The Warrant Agent shall notify the Trustee immediately upon
its receipt of a Call Notice and upon receipt of payment of the Call Price. The
Warrant Agent shall transfer the amount of any paid Call Price to the Trustee in
immediately available funds, for deposit in the Certificate Account and
application pursuant to the Trust Agreement on the applicable Call Date (and,
pending such transfer, shall hold such amount for the benefit of the Warrant
Holder in a
segregated trust account).
(d) Delivery of a Call Notice does not give rise to an obligation
on the part of the Warrant Holder to pay the Call Price. If, by 10:00 a.m. (New
York City time) on the Call Date, the Warrant Holder has not paid the Call
Price, except in connection with a Call Notice relating to a tender offer for or
redemption of Underlying Securities, then the Call Notice shall automatically
expire and none of the Warrant Holder, the Warrant Agent or the Trustee shall
have any obligation with respect to the Call Notice. The expiration of a Call
Notice shall in no way affect the Warrant Xxxxxx's right to deliver a Call
Notice at a later date. The Call Price for a call in connection with a tender
offer or redemption shall be deducted from the proceeds of a tender offer or a
redemption by the Trust pursuant to Section 7(g)(iii) or Section 7(h)(iii), as
applicable, of the Series Supplement.
Section 1.2 TRANSFER OF CERTIFICATES. As soon as practicable after each
surrender of the Call Warrants in whole or in part on the Call Date and upon
satisfaction of all other requirements described in the Call Warrants and in
Section 1.1 hereof, the Warrant Agent shall instruct the Trustee as follows:
(a) if Call Warrants are being exercised by any Warrant Holder
other than the Depositor or any Affiliate of the Depositor, to cause the Called
Certificates to reflect the Warrant Holder's beneficial ownership of such
Certificates and if such Call Notice is also deemed to be a notice of Optional
Exchange (it being expressly understood that any Optional Exchange must comply
with provisions of Section 7(a) and 7(b) of the Series Supplement), to cause a
distribution of Underlying Securities to the Warrant Holder in accordance with
Section 7(a) of the Series Supplement, provided, however, that if such Call
Notice and Optional Exchange is in connection with a tender offer or a
redemption, the Warrant Agent shall instruct the Trustee to distribute to the
exercising Warrant Holder the excess of the tender offer or redemption proceeds
over the Call Price pursuant to Section 7(g)(iii) or Section 7(h)(iii), as
applicable, of the Series Supplement, or
(b) if the Call Warrants are being exercised by the Depositor or
any Affiliate of the Depositor, to cause the Called Underlying Securities to be
sold pursuant to Section 13 of the Series Supplement and to distribute the
proceeds of such sale to the Warrant Holder.
In each case, the Trustee shall act in accordance with such
instructions.
Section 1.3 CANCELLATION AND DESTRUCTION OF CALL WARRANTS. All Call
Warrants surrendered to the Warrant Agent for the purpose of exercise (in whole
but not in part) pursuant to Section 1.1 and actually exercised, or for the
purpose of transfer or exchange pursuant to Article IV, shall be cancelled by
the Warrant Agent, and no Call Warrant (other than that reflecting any such
transfer or exchange) shall be issued in lieu thereof. The Warrant Agent shall
destroy all cancelled Call Warrants.
Section 1.4 NO RIGHTS AS HOLDER OF CERTIFICATES CONFERRED BY CALL
WARRANTS. Prior to the exercise thereof, the Call Warrants shall not entitle the
Warrant Holder to any of the rights of a holder of the Certificates, including,
without limitation, the right to receive the payment of any
amount on or in respect of the Certificates or to enforce any of the covenants
of the Trust Agreement.
Section 1.5 PRO RATA REDUCTION OF CALL WARRANTS IF PARTIAL REDEMPTION
OF UNDERLYING SECURITIES. If Underlying Securities are redeemed in part by the
Underlying Securities Issuer and the Warrant Holders do not exercise their Call
Rights in connection with such partial redemption, the Warrant Amount or
Registered Warrant Amount, as the case may be, held by each Warrant Holder shall
be reduced proportionately so that the aggregate amount of Class A Certificates
callable by Call Warrants shall equal the amount of outstanding Class A
Certificates after giving effect to such partial redemption and the aggregate
notional amount of Class X Certificates callable by Call Warrants shall equal
the outstanding notional amount of Class X Certificates after giving effect to
such partial redemption. The Warrant Agent shall make such adjustments to its
records as shall be necessary to reflect such reductions and shall notify the
Depository or each Warrant Holder, as the case may be, of such adjustments.
ARTICLE II
THE CALL WARRANTS
Section 2.1 THE CALL WARRANTS.
(a) The Call Warrants shall initially be issued as one or
more Certificated Call Warrants in definitive, fully registered form
without coupons in the name of the purchaser. Upon issuance, the
Certificated Call Warrants shall initially be delivered to the
purchaser or its nominee. Such Certificated Call Warrants shall
initially be registered in the name of to the purchaser or its nominee.
The Call Warrants shall be held subsequent to the Closing Date as
Certificated Call Warrants or Global Call Warrants as set forth in
Section 4.2(a) below. The Global Call Warrants shall be issued, as one
or more Global Call Warrants, in definitive, fully registered form
without coupons, and DTC shall be the Depository. Upon issuance, the
Global Call Warrants shall initially be deposited with the Trustee in
its capacity as custodian on behalf of DTC. Such Global Call Warrants
shall initially be registered in the name of Cede & Co. or another
nominee designated by DTC. Global Call Warrants shall clear and settle
in book-entry only form through the facilities of the Depository.
Unless and until it is exchanged in whole or in part for Certificated
Call Warrants, a Global Call Warrant may not be transferred except as a
whole by the Depository for such Global Call Warrant 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 of such Depository or a nominee of such
successor. The Registered Warrant Amount of Call Warrants may from time
to time be increased or decreased by adjustments made on the records of
the Trustee, as custodian for DTC for such Global Call Warrant, as
provided in this Section.
(b) The Warrant Agent shall register the transfer or
exchange of any Global Call Warrant without requiring any additional
certification.
(c) Interests of beneficial owners in a Global Call
Warrant may be transferred
in accordance with the rules and procedures of DTC and any other
applicable Depositories. In connection with any exchange of beneficial
ownership interests in a Global Call Warrant for Certificated Call
Warrants pursuant to Section 2.3, the Warrant Agent shall reflect on
its books and records the date of such exchange and a decrease in the
Registered Warrant Amount of such Global Call Warrant in an amount
equal to the Warrant Amount of the beneficial ownership interests in
such Global Call Warrant being exchanged for Certificated Call
Warrants.
Section 2.2 CANCELLATION. All Call Warrants presented and surrendered
for payment, transfer or exchange shall be delivered to the Warrant Agent and
shall be promptly canceled by it. No Call Warrants shall be authenticated in
lieu of or in exchange for any Call Warrants canceled as provided in this
Section 2.2.
Section 2.3 CERTIFICATED CALL WARRANTS. Any Global Call Warrant
representing Call Warrants shall be exchangeable for Certificated Call Warrants
only if (i) the Depository advises the Depositor in writing that it is no longer
willing or able to properly discharge its responsibilities with respect to the
Call Warrants and the Depositor is unable to locate a qualified successor within
60 calendar days or (ii) the Depositor, at its option, advises the Trustee in
writing that it elects to terminate the book-entry system through the
Depository. Any Global Call Warrant that is exchangeable pursuant to the
preceding sentence will be exchangeable for Certificated Call Warrants of like
tenor and Warrant Amount, as applicable, in any authorized denomination or
denominations and registered in the names of such Person or Persons as the
Depository shall direct. Upon such exchange, the Warrant Agent shall execute and
authenticate such Certificated Call Warrants and register the same in the name
of, and deliver the same to, such Person or Persons consistent with the
provisions hereof.
ARTICLE III
RESTRICTIONS ON TRANSFER
Section 3.1 RESTRICTIVE LEGENDS. Except as otherwise permitted by this
Article III, each Call Warrant (including each Call Warrant issued upon the
transfer of any Call Warrant) shall be issued with a legend in substantially the
following form:
"THESE CALL WARRANTS (OR ITS PREDECESSOR) HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION
UNDER SUCH ACT IS IN EFFECT OR PURSUANT TO AN EXEMPTION THEREFROM UNDER
SUCH ACT. THE CALL WARRANTS REPRESENTED HEREBY MAY BE TRANSFERRED ONLY
IN COMPLIANCE WITH THE CONDITIONS SPECIFIED IN THESE CALL WARRANTS.
EACH PURCHASER OF THIS CALL WARRANT IS HEREBY NOTIFIED THAT THE SELLER
OF THESE CALL WARRANTS MAY BE RELYING ON THE EXEMPTION FROM THE
PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER."
Section 3.2 NOTICE OF PROPOSED TRANSFER. Prior to any transfer of any
Call Warrant or
portion thereof, the Warrant Holder will give five (5) Business Days (or such
lesser period acceptable to the Warrant Agent) prior written notice to the
Warrant Agent of such Warrant Holder's intention to effect such transfer.
ARTICLE IV
REGISTRATION AND TRANSFER OF CALL WARRANTS, ETC.
Section 4.1 WARRANT REGISTER; OWNERSHIP OF CALL WARRANTS. The Warrant
Agent will keep a register in which the Warrant Agent will provide for the
registration of Call Warrants and the registration of transfers of Call Warrants
representing numbers of Call Warrants. Prior to due presentment of a Call
Warrant for registration of transfer, the Depositor, the Trustee, the Warrant
Agent and any agent of the Depositor, the Trustee or the Warrant Agent may treat
the Person in whose name any Call Warrant is registered as the owner of such
Call Warrant for any purposes whatsoever, and none of the Depositor, the
Trustee, the Warrant Agent or any agent of the Depositor, the Trustee or the
Warrant Agent shall be affected by notice to the contrary.
None of the Depositor, the Trustee, the Warrant Agent or any agent of
the Depositor, the Trustee or the Warrant Agent shall have any responsibility or
liability for any aspect of the records relating to, or payments made on account
of, beneficial ownership interests of a Global Call Warrant or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
Notwithstanding the foregoing, with respect to any Global Call Warrant,
nothing herein shall prevent the Depositor, the Trustee, the Warrant Agent or
any agent of the Depositor, the Trustee or the Warrant Agent from giving effect
to any written certification, proxy or other authorization furnished by any
Depository, as a Warrant Holder, with respect to such Global Call Warrant or
impair, as between such Depository and owners of beneficial interests in such
Global Call Warrant, the operation of customary practices governing the exercise
of the rights of such Depository (or its nominee) as Warrant Holder of such
Global Call Warrant.
Section 4.2 TRANSFER AND EXCHANGE OF CALL WARRANTS.
(a) No Call Warrant may be offered, resold, assigned or
otherwise transferred (including by pledge or hypothecation) at any
time prior to (x) the date which is two years, or such shorter period
of time as permitted by Rule 144(k) under the Securities Act, after the
later of the original issue date of such Call Warrant and the last date
on which the Depositor or any "affiliate" (as defined in Rule 144 under
the Securities Act) of the Depositor was the owner of such Call Warrant
(or any predecessor thereto) or (y) such later date, if any, as may be
required by a change in applicable securities laws (the "RESALE
RESTRICTION TERMINATION DATE") unless such offer, resale, assignment or
transfer is (i) to the Trust, (ii) pursuant to an effective
registration statement under the Securities Act, (iii) to a qualified
institutional buyer (a "QIB"), as such term is defined in Rule 144A
promulgated under the Securities Act ("RULE 144A"), in accordance with
Rule 144A or (iv) pursuant to another available exemption from
registration provided under the Securities Act (including transfers to
Accredited Investors), and, in each of cases (i) through (iv), in
accordance with any applicable securities laws of any state of the
United
States and other jurisdictions. Notwithstanding the foregoing, the Call
Warrants may not be offered, resold, assigned or otherwise transferred
(including by pledge or hypothecation) at any time unless the
prospective transferee is acquiring the Class X Certificates and the
Call Warrants concurrently. Prior to any offer, resale, assignment or
transfer of any Call Warrant in the manner described in clause (iii)
above, the prospective transferee and the prospective transferor shall
be required to deliver to the Trustee an executed copy of an Investment
Letter with respect to the Call Warrant to be transferred substantially
in the form of Exhibit A hereto and in the event the resale, assignment
or transfer shall involve Call Warrants then being held in physical
form, such Call Warrants shall be delivered to the Trustee for
cancellation and the Trustee shall instruct the Depository to increase
the aggregate notional amount of the Call Warrants held in book-entry
form by an amount equal to the aggregate notional amount of the Call
Warrants so resold, assigned or transferred and to issue a beneficial
interest in such global Call Warrants to such transferee. Prior to any
offer, resale, assignment or transfer of any Call Warrants in the
manner described in clause (iv) above, the prospective transferee and
the prospective transferor shall be required to deliver to the Trustee
documentation certifying that the offer, resale, assignment or transfer
complies with the provisions of said clause (iv) and, in the event any
such Call Warrant shall then be held in book-entry form and such
resale, assignment or transfer shall be to an Accredited Investor that
is not a QIB, the Trustee shall instruct the Depository to decrease the
aggregate notional amount of the Call Warrants held in book-entry form
and the Trustee shall authenticate and deliver one or more Call
Warrants in physical form in an aggregate notional amount equal to the
amount of Call Warrants resold, assigned or transferred. In addition to
the foregoing, each prospective transferee of any Call Warrants in the
manner contemplated by clause (iii) above shall acknowledge, represent
and agree as follows:
(1) The transferee (x) is a QIB, (y) is aware
that the sale to it is being made in
reliance on Rule 144A and (z) is acquiring
such Call Warrants for its own account or
for the account of a QIB.
(2) The transferee understands that the Call
Warrants are being offered in a transaction
not involving any public offering in the
United States within the meaning of the
Securities Act, and that the Call Warrants
have not been and will not be registered
under the Securities Act.
(3) The transferee agrees that (A) if in the
future it decides to offer, resell, pledge
or otherwise transfer the Call Warrants
prior to the Resale Restriction Termination
Date, such Call Warrants shall only be
offered, resold, assigned or otherwise
transferred (i) to the Trust, (ii) pursuant
to an effective registration statement under
the Securities Act, (iii) to a QIB, in
accordance with Rule 144A or (iv) pursuant
to another available exemption from
registration provided under the Securities
Act (including any transfer to an Accredited
Investor), and, in each of cases (i) through
(iv), in accordance with any applicable
securities laws of any state of the United
States and other jurisdictions and (B) the
transferee will, and each subsequent
holder is required to, notify any subsequent
purchaser of such Call Warrants from it of
the resale restrictions referred to in
clause (A) above.
(4) The transferee, concurrent with the transfer
of the Class X Certificates is acquiring the
Call Warrants.
(b) Upon surrender of any Certificated Call Warrants for
registration of transfer or for exchange to the Warrant Agent, the
Warrant Agent shall (subject to compliance with Article III) promptly
execute and deliver, and cause the Trustee, on behalf of the Trust, to
execute and deliver, in exchange therefor, a new Certificated Call
Warrant of like tenor and evidencing a like number of Call Warrants, in
the name of such Warrant Holder or as such Warrant Holder (upon payment
by such Warrant Holder of any applicable transfer taxes or government
charges) may direct; provided that as a condition precedent for
transferring the Call Warrants, the prospective transferee shall
deliver to the Trustee and the Depositor an executed copy of the
Investment Letter (set forth as Exhibit A hereto) if the same is
required pursuant to the provisions of clause (a) above.
Section 4.3 REPLACEMENT OF CALL WARRANTS. Upon receipt of evidence
reasonably satisfactory to the Warrant Agent of the loss, theft, destruction or
mutilation of any Call Warrant and, in the case of any such loss, theft or
destruction of any Call Warrant, upon delivery of an indemnity bond in such
reasonable amount as the Warrant Agent may determine, or, in the case of any
such mutilation, upon the surrender of such Call Warrant for cancellation to the
Warrant Agent, the Warrant Agent shall execute and deliver, and cause the
Trustee, on behalf of the Trust, to execute and deliver, in lieu thereof, a new
Call Warrant of like tenor bearing a number not contemporaneously outstanding.
Section 4.4 EXECUTION AND DELIVERY OF CALL WARRANTS BY TRUSTEE. The
Trustee, on behalf of the Trust, hereby agrees (subject to compliance with
Article III) to execute and deliver such new Call Warrants issued in accordance
with Section 1.2 or this Article IV as the Warrant Agent shall request in
accordance herewith.
Section 4.5 ADDITIONAL CALL WARRANTS. The Trustee shall execute and
deliver, in a manner consistent with Article II hereof, additional Call Warrants
on behalf of the Trust with respect to any additional Certificates issued by the
Trust following the sale of additional Underlying Securities to the Trust, in
accordance with the provisions of Section 3(d) of the Series Supplement.
ARTICLE V
DEFINITIONS
As used herein, unless the context otherwise requires, the following
terms have the following respective meanings:
"ACCREDITED INVESTOR": a Person that qualifies as an "accredited
investor" within the meaning of Rule 501(a) under the Securities Act.
"BUSINESS DAY": As defined in the Trust Agreement.
"CALL DATE" Any Business Day (i) on or after October 28, 2005, (ii)
after the Underlying Securities Issuer announces that it will redeem, prepay or
otherwise make an unscheduled payment on the Underlying Securities, (iii) after
the Trustee notifies the Certificateholders of any proposed sale of the
Underlying Securities pursuant to the provisions of the Series Supplement or
(iv) on the date on which the Underlying Securities Issuer or affiliate thereof
consummates a tender offer for some or all of the Underlying Securities.
"CALL NOTICE": As defined in Section 1.1(a)(i) hereof.
"CALL PRICE": For each related Call Date, (i) in the case of the Class
A Certificates, 100% of the outstanding Certificate Principal Balance of the
Class A Certificates being purchased pursuant to the exercise of the Call
Warrants, plus any accrued and unpaid interest on such amount to but excluding
the Call Date and, (ii) in the case of the Class X Certificates, the present
value of all amounts that would otherwise have been payable on the Class X
Certificates being purchased pursuant to the exercise of the Call Warrants for
the period from the related Call Date to the Final Scheduled Distribution Date
using a discount rate of 6.00% per annum, assuming no delinquencies, deferrals,
redemptions or prepayments on the Underlying Securities shall occur after the
related Call Date.
"CALL WARRANTS": As defined in the recitals.
"CALLED CERTIFICATES": As defined in Section 1.1(b) hereof.
"CALLED UNDERLYING SECURITIES": As defined in Section 1.1(b) hereof.
"CERTIFICATED CALL WARRANT": Any Call Warrant in definitive, physical
form registered in the name of a Person other than the Depository or its
nominee.
"CLASS A CERTIFICATES": the 5.10% Class A Certificates due March 3,
2011 issued by USAutos Series 2004-1.
"CLASS X CERTIFICATES": the 2.2125% Class X Certificates due March 3,
2011 issued by USAutos Series 2004-1.
"CLOSING DATE": October 28, 2004.
"DEPOSITOR": As defined in the recitals.
"DEPOSITOR ORDER": As defined in the Trust Agreement.
"DEPOSITORY": DTC initially, or such other depository appointed by the
Depositor.
"DTC": The Depository Trust Company, a limited purpose trust company
organized under the laws of the State of New York, and any of its successors or
assigns.
"GLOBAL CALL WARRANT": A registered Call Warrant in the name of the
Depository or its nominee.
"PERSON": Any individual, corporation, partnership, joint venture,
association, joint stock company, trust (including any beneficiary thereof),
unincorporated organization or government or any agency or political subdivision
thereof.
"QIB": As defined in Section 4.2 hereof.
"RATING AGENCIES": Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies, Inc. and Xxxxx'x Investors Service, Inc. and any of
their respective successors.
"REGISTERED WARRANT AMOUNT": The Warrant Amount represented by the
Global Call Warrants.
"RESALE RESTRICTION TERMINATION DATE": As defined in Section 4.2
hereof.
"RESPONSIBLE OFFICER": As defined in the Trust Agreement.
"RULE 144A": As defined in Section 4.2 hereof.
"SECURITIES ACT": The Securities Act of 1933, or any similar federal
statute, and the rules and regulations of the Commission thereunder, all as the
same shall be in effect at the time.
"TRUST": As defined in the recitals.
"TRUST AGREEMENT": As defined in the recitals.
"TRUSTEE": As defined in the recitals, or any successor thereto under
the Trust Agreement.
"WARRANT AGENT": As defined in the recitals, or any successor thereto
under this Warrant Agent Agreement.
"WARRANT AGENT AGREEMENT": As defined in the recitals.
"WARRANT AMOUNT": With respect to any Warrant Holder, the number of
Call Warrants relating to Class A Certificates and Call Warrants relating to the
Class X Certificates, held by such Warrant Holder.
"WARRANT HOLDER": As defined in Section 1.1(a) hereof.
ARTICLE VI
WARRANT AGENT
Section 6.1 LIMITATION ON LIABILITY. The Warrant Agent shall be
protected and shall incur no liability for or in respect of any action taken,
suffered or omitted by it in connection with its administration of the Call
Warrants in reliance upon any instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, direction, consent,
certificate, statement or other paper or document in good faith believed by it
to be genuine and to be signed, executed and, where necessary, verified and
acknowledged, by the proper Person or Persons.
Section 6.2 DUTIES OF WARRANT AGENT. The Warrant Agent undertakes only
the specific duties and obligations imposed hereunder upon the following terms
and conditions, by all of which the Depositor, the Trust, the Trustee and each
Warrant Holder shall be bound:
(a) The Warrant Agent may consult with legal counsel (who
may be legal counsel for the Depositor), and the opinion of such
counsel shall be full and complete authorization and protection to the
Warrant Agent as to any action taken or omitted by it in good faith and
in accordance with such opinion, provided the Warrant Agent shall have
exercised reasonable care in the selection by it of such counsel.
(b) Whenever in the performance of its duties hereunder,
the Warrant Agent shall deem it necessary or desirable that any fact or
matter be proved or established by the Depositor or the Trustee prior
to taking or suffering any action hereunder, such fact or matter may be
deemed to be conclusively proved and established by a Depositor Order
or a certificate signed by a Responsible Officer of the Trustee and
delivered to the Warrant Agent; and such certificate shall be full
authorization to the Warrant Agent for any action taken or suffered in
good faith by it hereunder in reliance upon such certificate.
(c) The Warrant Agent shall be liable hereunder only for
its own gross negligence, willful misconduct or bad faith.
(d) The Warrant Agent shall not be liable for or by
reason of any of the statements of fact or recitals contained herein or
be required to verify the same, but all such statements and recitals
are and shall be deemed to have been made by the Trust and the
Depositor only.
(e) The Warrant Agent shall not have any responsibility
in respect of and makes no representation as to the validity of the
Call Warrants or the execution and delivery thereof (except the due
execution hereof by the Warrant Agent); nor shall it be responsible for
any breach by the Trust of any covenant or condition contained in the
Call Warrants; nor shall it by any act thereunder be deemed to make any
representation or warranty as to the Certificates to be purchased
thereunder.
(f) The Warrant Agent is xxxxxx authorized and directed
to accept instructions with respect to the performance of its duties
hereunder from the Chairman of the Board, the Chief Executive Officer,
Chief Financial Officer, Chief Operating Officer, President, a Vice
President, a Senior Vice President, a Managing Director, its Treasurer,
an Assistant Treasurer, its Secretary or an Assistant Secretary of the
Depositor, and any Responsible Officer of the Trustee, and to apply to
such officers for advice or instructions in connection with its duties,
and it shall not be liable for any action taken or suffered to be taken
by it in good faith in accordance with instructions of any such
officer.
(g) The Warrant Agent and any shareholder, director,
officer or employee of the Warrant Agent may buy, sell or deal in any
of the Call Warrants or other securities of the Trust or otherwise act
as fully and freely as though it were not Warrant Agent hereunder, so
long as such persons do so in full compliance with all applicable laws.
Nothing herein shall preclude the Warrant Agent from acting in any
other capacity for the Trust, the Depositor or for any other legal
entity.
(h) The Warrant Agent may execute and exercise any of the
rights or powers hereby vested in it or perform any duty hereunder
either itself or by or through its attorneys or agents.
(i) The Warrant Agent shall act solely as the agent of
the Trust hereunder. The Warrant Agent shall not be liable except for
the failure to perform such duties as are specifically set forth
herein, and no implied covenants or obligations shall be read into the
Call Warrants against the Warrant Agent, whose duties shall be
determined solely by the express provisions thereof. The Warrant Agent
shall not be deemed to be a fiduciary.
(j) The Warrant Agent shall not be responsible for any
failure on the part of the Trustee to comply with any of its covenants
and obligations contained herein.
(k) The Warrant Agent shall not be under any obligation
or duty to institute, appear in or defend any action, suit or legal
proceeding in respect hereof, unless first indemnified to its
satisfaction, but this provision shall not affect the power of the
Warrant Agent to take such action as the Warrant Agent may consider
proper, whether with or without such indemnity. The Warrant Agent shall
promptly notify the Depositor and the Trustee in writing of any claim
made or action, suit or proceeding instituted against it arising out of
or in connection with the Call Warrants.
(l) The Trustee will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered
all such further acts, instruments and assurances as may be required by
the Warrant Agent in order to enable it to carry out or perform its
duties hereunder.
(m) Upon request of a Warrant Holder, the Warrant Agent
shall furnish to such Warrant Holder and/or a prospective purchaser
designated by such Warrant Holder the information required to be
delivered under Rule 144A(d)(4) under the Securities Act, to the extent
that such information is in the possession of the Warrant Agent.
Section 6.3 CHANGE OF WARRANT AGENT. The Warrant Agent may resign and
be discharged from its duties hereunder upon thirty (30) days notice in writing
mailed to the Depositor and the Trustee by registered or certified mail, and to
the Warrant Holders by first-class mail at the expense of the Depositor;
provided that no such resignation or discharge shall become effective until a
successor Warrant Agent shall have been appointed hereunder. The
Depositor may remove the Warrant Agent or any successor Warrant Agent upon
thirty (30) days notice in writing, mailed to the Warrant Agent or successor
Warrant Agent, as the case may be, and to the Warrant Holders by first-class
mail; provided further that no such removal shall become effective until a
successor Warrant Agent shall have been appointed hereunder. If the Warrant
Agent shall resign or be removed or shall otherwise become incapable of acting,
the Depositor shall promptly appoint a successor to the Warrant Agent, which may
be designated as an interim Warrant Agent. If an interim Warrant Agent is
designated, the Depositor shall then appoint a permanent successor to the
Warrant Agent, which may be the interim Warrant Agent. If the Depositor shall
fail to make such appointment of a permanent successor within a period of thirty
(30) days after such removal or within sixty (60) days after notification in
writing of such resignation or incapacity by the resigning or incapacitated
Warrant Agent or by the Warrant Holder, then the Warrant Agent or registered
Warrant Holder may apply to any court of competent jurisdiction for the
appointment of such a successor. Any successor to the Warrant Agent appointed
hereunder must be rated in one of the four highest rating categories by the
Rating Agencies. Any entity which may be merged or consolidated with or which
shall otherwise succeed to substantially all of the trust or agency business of
the Warrant Agent shall be deemed to be the successor Warrant Agent without any
further action.
Section 6.4 WARRANT AGENT TRANSFER FEE. The Warrant Agent will assess a
fee of $50.00 upon the issue of any new Call Warrant, such fee to be assessed
upon the new Warrant Holder.
ARTICLE VII
MISCELLANEOUS
Section 7.1 REMEDIES. The remedies at law of the Warrant Holder in the
event of any default or threatened default by the Warrant Agent in the
performance of or compliance with any of the terms of the Call Warrants are not
and will not be adequate and, to the full extent permitted by law, such terms
may be specifically enforced by a decree for the specific performance of any
agreement contained herein or by an injunction against a violation of any of the
terms thereof or otherwise.
Section 7.2 LIMITATION ON LIABILITIES OF WARRANT HOLDER. Nothing
contained in this Warrant Agent Agreement shall be construed as imposing any
obligation on the Warrant Holder to purchase any of the Certificates except in
accordance with the terms thereof.
Section 7.3 NOTICES. All notices and other communications under this
Warrant Agent Agreement shall be in writing and shall be delivered, or mailed by
registered or certified mail, return receipt requested, by a nationally
recognized overnight courier, postage prepaid, addressed (a) if to any Warrant
Holder, at the registered address of such Warrant Holder as set forth in the
register kept by the Warrant Agent or (b) if to the Warrant Agent, to 000 Xxxx
Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate Trust or to
such other address notice of which the Warrant Agent shall have given to the
Warrant Holder and the Trustee or (c) if to the Trust or the Trustee, to the
Corporate Trust Office (as set forth in the Trust Agreement); provided that the
exercise of any Call Warrant shall be effective in the manner provided in
Article I. The Warrant Agent shall forward to the Warrant Holder any notices
received by it hereunder or pursuant to the Trust Agreement or this Warrant
Agent Agreement by facsimile
within one Business Day of receipt thereof.
Section 7.4 AMENDMENT.
(a) This Warrant Agent Agreement may be amended from time
to time by the Depositor, the Trustee and the Warrant Agent without the
consent of any Warrant Holder, upon receipt of an opinion of counsel
satisfactory to the Warrant Agent that the provisions hereof have been
satisfied and that such amendment would not cause the Trust to be taxed
as an association or publicly traded partnership taxable as a
Corporation under the Code, for any of the following purposes: (i) to
cure any ambiguity or to correct or supplement any provision herein
which may be defective or inconsistent with any other provision herein
or to provide for any other terms or modify any other provisions with
respect to matters or questions arising under the Call Warrant which
shall not adversely affect in any material respect the interests of the
Warrant Holder or any holder of a Certificate; provided, however, that
no amendment altering the timing or amount of any payment of the Call
Price shall be effected without the consent of each Warrant Holder; or
(ii) to evidence and provide for the acceptance of appointment
hereunder of a Warrant Agent other than U.S. Bank Trust National
Association.
(b) Without limiting the generality of the foregoing, the
Call Warrants may also be modified or amended from time to time by the
Depositor, the Trustee and the Warrant Agent with the consent of
Warrant Holders of 66-2/3% of each of the Call Warrants related to the
Class A Certificates and the Call Warrants related to the Class X
Certificates, upon receipt of an opinion of counsel satisfactory to the
Warrant Agent that the provisions hereof (including, without
limitation, the following proviso) have been satisfied, for the purpose
of adding any provisions to or changing in any manner or eliminating
any of the provisions of the Call Warrants or of modifying in any
manner the rights of the Warrant Holders; provided, however, that no
such amendment shall (i) adversely affect in any material respect the
interests of holders of Certificates without the consent of the holders
of Certificates evidencing not less than the Required
Percentage--Amendment of the aggregate Voting Rights of such affected
Certificates (as such terms are defined in the Trust Agreement) and
without written confirmation from the Rating Agencies that such
amendment will not result in a downgrading or withdrawal of its rating
of the Certificates; (ii) alter the terms on which Call Warrants are
exercisable or the amounts payable upon exercise of a Warrant without
the consent of the holders of Certificates evidencing not less than
100% of the aggregate Voting Rights of such affected Certificates and
100% of the affected Warrant Holders or (iii) reduce the percentage of
aggregate Voting Rights required by (i) or (ii) without the consent of
the holders of all such affected Certificates. Notwithstanding any
other provision of this Warrant Agent Agreement, this Section 7.4(b)
shall not be amended without the consent of 100% of the affected
Warrant Holders.
(c) Promptly after the execution of any such amendment or
modification, the Warrant Agent shall furnish a copy of such amendment
or modification to each Warrant Holder, to the Trustee and to the
Rating Agencies. It shall not be necessary for the consent of Warrant
Holders or holders of Certificates under this Section to approve the
particular form of any proposed amendment, but it shall be sufficient
if such consent shall
approve the substance thereof. The manner of obtaining such consents
and of evidencing the authorization of the execution thereof shall be
subject to such reasonable regulations as the Warrant Agent may
prescribe.
Section 7.5 EXPIRATION. The right to exercise the Call Warrants shall
expire on the earliest to occur of (a) the cancellation thereof, (b) the
termination of the Trust Agreement, or (c) the liquidation, disposition, or
maturity of all of the Underlying Securities.
Section 7.6 DESCRIPTIVE HEADINGS. The headings in this Warrant Agent
Agreement are for purposes of reference only and shall not limit or otherwise
affect the meaning hereof.
Section 7.7 GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY,
THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF
LAWS (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW).
Section 7.8 JUDICIAL PROCEEDINGS; WAIVER OF JURY. Any judicial
proceeding brought against the Trust, the Trustee or the Warrant Agent with
respect to this Warrant Agent Agreement may be brought in any court of competent
jurisdiction in the County of New York, State of New York or of the United
States of America for the Southern District of New York and, by execution and
delivery of the Call Warrants, the Trustee on behalf of the Trust and the
Warrant Agent (a) accept, generally and unconditionally, the nonexclusive
jurisdiction of such courts and any related appellate court, and irrevocably
agree that the Trust, the Trustee and the Warrant Agent shall be bound by any
judgment rendered thereby in connection with this Warrant Agent Agreement or the
Call Warrants, subject to any rights of appeal, and (b) irrevocably waive any
objection that the Trust, the Trustee or the Warrant Agent may now or hereafter
have as to the venue of any such suit, action or proceeding brought in such a
court or that such court is an inconvenient forum.
Section 7.9 NONPETITION COVENANT; NO RECOURSE. Each of (i) the Warrant
Holder by its acceptance thereof, and (ii) the Warrant Agent agrees, that it
shall not (and, in the case of the Warrant Holder, that it shall not direct the
Warrant Agent to), until the date which is one year and one day after the
payment in full of the Certificates and all other securities issued by the
Trust, the Depositor or entities formed, established or settled by the
Depositor, acquiesce, petition or otherwise invoke or cause the Trust, the
Depositor, or any such other entity to invoke the process of the United States
of America, any State or other political subdivision thereof or any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government for the purpose of commencing or
sustaining a case by or against the Trust, the Depositor or any such other
entity 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, the Depositor or any such other entity or
all or any part of the property or assets of Trust, the Depositor or any such
other entity or ordering the winding up or liquidation of the affairs of the
Trust, the Depositor or any such other entity.
IN WITNESS WHEREOF, the parties hereto have caused their names to be signed
hereto by their respective duly authorized officers as of the date first above
written.
FREEDOM DEPOSITORY, LLC,
as Depositor
By: ASG GENERAL PARTNER, INC.
its Manager
By:
------------------------------
Name: Xxxx X. Xxxxxx
Title: President
U.S. BANK TRUST NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Trustee and Authenticating Agent
By:
------------------------------
Name:
Title:
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Warrant Agent
By:
------------------------------
Name:
Title:
EXHIBIT A TO EXHIBIT B
FORM OF INVESTMENT LETTER
QUALIFIED INSTITUTIONAL BUYER
Dated: ___________ __, _____
U.S. Bank Trust National Association, as Trustee
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Freedom Depository, LLC
as Depositor
0000 Xxxxx Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
Re: Freedom Certificates(sm), USAutos Series 2004-1
Ladies and Gentlemen:
In connection with its proposed purchase of Call Warrants (the "Call
Warrants") which represent the right to call $______________ aggregate
certificate principal balance of Freedom Certificates(sm), USAutos Series 2004-1
Class A Certificates and $_______________ aggregate notional amount of Freedom
Certificates(sm), USAutos Series 2004-1 Class X Certificates, the undersigned
purchaser (the "Purchaser") confirms that:
1. The Purchaser understands that substantial risks are involved in an
investment in the Call Warrants. The Purchaser represents that in making its
investment decision to acquire the Call Warrants, the Purchaser has not relied
on representations, warranties, opinions, projections, financial or other
information or analysis, if any, supplied to it by any person, including you,
Freedom Depository, LLC, as depositor (the "Depositor"), or U.S. Bank Trust
National Association, as trustee (the "Trustee"), or any of your or their
affiliates, except as expressly contained in written information, if any. The
Purchaser has such knowledge and experience in financial and business matters as
to be capable of evaluating the merits and risks of an investment in the Call
Warrants, and the Purchaser is able to bear the substantial economic risks of
such an investment. The Purchaser has relied upon its own tax, legal and
financial advisors in connection with its decision to purchase the Call
Warrants.
2. The Purchaser (A) is a "Qualified Institutional Buyer" (as defined
in Rule 144A under the Securities Act of 1933, as amended (the "1933 Act")) and
(B) is acquiring the Call Warrants for its own account or for the account of an
investor of the type described in clause (A) above as to each of which the
Purchaser exercises sole investment discretion. The Purchaser is purchasing the
Call Warrants for investment purposes and not with a view to, or for, the offer
or sale in connection with, a public distribution or in any other manner that
would violate the 1933 Act or the securities or blue sky laws of any state.
3. The Purchaser understands that the Call Warrants have not been and
will not be registered under the 1933 Act or under the securities or blue sky
laws of any state, and that (i) if it decides to resell, pledge or otherwise
transfer any Security, such resale, pledge or other transfer must comply with
the provisions of the Warrant Agent Agreement relating to the Call Warrants
(including, without limitation, the provisions of Section 4.2 thereof) and (ii)
it will, and each subsequent holder will be required to, notify any purchaser of
any Security from it of the resale restrictions referred to in clause (i) above.
4. The Purchaser understands that each of the Call Warrants will bear a
legend substantially to the following effect, unless otherwise agreed by the
Depositor and the Trustee:
"THIS CALL WARRANT (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A
REGISTRATION UNDER SUCH ACT IS IN EFFECT OR PURSUANT TO AN
EXEMPTION THEREFROM UNDER SUCH ACT. THE CALL WARRANT REPRESENTED
HEREBY MAY BE TRANSFERRED ONLY IN COMPLIANCE WITH THE CONDITIONS
SPECIFIED HEREIN OR IN THE SERIES SUPPLEMENT.
EACH PURCHASER OF THIS CALL WARRANT IS HEREBY NOTIFIED THAT THE
SELLER OF THIS CALL WARRANT MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE
144A THEREUNDER."
5. The Purchaser understands that no subsequent transfer of the Call
Warrants is permitted unless (A) such transfer is of a Call Warrant with the
applicable minimum denomination and (B) the Purchaser causes the proposed
transferee to provide to the Depositor and the Trustee such documentation as may
be required pursuant to Section 4.2 of the Warrant Agent Agreement, including,
if required, a letter substantially in the form hereof, or such other written
statement as the Depositor shall reasonably prescribe.
6. The Purchaser is a person or entity (a "Person") who is either
A. (1) a citizen or resident of the United States, (2) a
corporation, partnership or other entity organized in or under the laws
of the United States or any political subdivision thereof, or (3) an
estate the income of which is includible in gross income for federal
income tax purposes regardless of source, or (4) a trust if a court
within the United States is able to exercise primary supervision of the
administration of the trust and one or more United States persons have
the authority to control all substantial decisions of the trust, or
B. a Person not described in (A), whose ownership of such Call
Warrant is effectively connected with such Person's conduct of a trade
or business within the United States within the meaning of the Internal
Revenue Code of 1986, as amended (the "Code"), and its ownership of any
interest in such Call Warrant will not result in any
withholding obligation with respect to any payments with respect to the
Call Warrants by any Person (other than withholding, if any, under
Section 1446 of the Code), or
C. a Person not described in (A) or (B) above, who is not a
Person: (1) that owns, directly or indirectly, 10% or more of the total
combined voting power of all classes of stock in the Underlying
Securities Issuer (as defined in the Prospectus Supplement) entitled to
vote, (2) that is a controlled foreign corporation related to the
Underlying Securities Issuer within the meaning of Section 864(d)(4) of
the Code, or (3) that is a bank extending credit pursuant to a loan
agreement entered into in the ordinary course of its trade or business.
7. The Purchaser agrees that (I) if it is a Person described in clause
(A) above, it will furnish to the Depositor and the Trustee a properly executed
IRS Form W-9, and (II) if it is a Person described in clause (B) above, it will
furnish to the Depositor and the Trustee a properly executed IRS Form W-8ECI,
and (III) if it is a Person described in clause (C) above, it will furnish to
the Depositor and the Trustee a properly executed IRS Form W-8BEN (or, if the
Purchaser is treated as a partnership for federal income tax purposes, a
properly executed IRS Form W-8IMY with appropriate certification for all
partners or members attached). The Purchaser also agrees that it will provide a
new IRS form upon the expiration or obsolescence of any previously delivered
form, and that it will provide such other certifications, representations or
Opinions of Counsel as may be requested by the Depositor and the Trustee.
8. The Purchaser agrees that if at some time in the future it wishes to
transfer or exchange any of the Call Warrants, it will not transfer or exchange
any of the Call Warrants unless such transfer or exchange is in accordance with
the terms of the Warrant Agent Agreement, Series Supplement and other documents
applicable to the Call Warrant. The Purchaser understands that any purported
transfer of the Call Warrants (or any interest therein) in contravention of any
of the restrictions and conditions in the agreements, as applicable, shall be
void, and the purported transferee in such transfer shall not be recognized by
any Person as a holder of such Call Warrants, for any purpose.
You and the Trustee are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Very truly yours,
[Name of Purchaser]
By:
----------------------------
Name:
---------------------------
Title:
---------------------------
EXHIBIT C
FORM OF INVESTMENT LETTER
QUALIFIED INSTITUTIONAL BUYER
Dated: ___________ __, _____
U.S. Bank Trust National Association, as Trustee
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Freedom Depository, LLC
as Depositor
0000 Xxxxx Xxxxxxx xx Xxxxx Xxxxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
Re: Freedom Certificates(sm), USAutos Series 2004-1
Ladies and Gentlemen:
In connection with its proposed purchase of Call Warrants (the "Call
Warrants") which represent the right to call $______________ aggregate
certificate principal balance of Freedom Certificates(sm), USAutos Series 2004-1
Class A Certificates and $_______________ aggregate notional amount of Freedom
Certificates(sm), USAutos Series 2004-1 Class X Certificates, the undersigned
purchaser (the "Purchaser") confirms that:
1. The Purchaser understands that substantial risks are involved in an
investment in the Call Warrants. The Purchaser represents that in making its
investment decision to acquire the Call Warrants, the Purchaser has not relied
on representations, warranties, opinions, projections, financial or other
information or analysis, if any, supplied to it by any person, including you,
Freedom Depository, LLC, as depositor (the "Depositor"), or U.S. Bank Trust
National Association, as trustee (the "Trustee"), or any of your or their
affiliates, except as expressly contained in written information, if any. The
Purchaser has such knowledge and experience in financial and business matters as
to be capable of evaluating the merits and risks of an investment in the Call
Warrants, and the Purchaser is able to bear the substantial economic risks of
such an investment. The Purchaser has relied upon its own tax, legal and
financial advisors in connection with its decision to purchase the Call
Warrants.
2. The Purchaser (A) is a "Qualified Institutional Buyer" (as defined
in Rule 144A under the Securities Act of 1933, as amended (the "1933 Act")) and
(B) is acquiring the Call Warrants for its own account or for the account of an
investor of the type described in clause (A) above as to each of which the
Purchaser exercises sole investment discretion. The Purchaser is purchasing the
Call Warrants for investment purposes and not with a view to, or for, the offer
or sale in connection with, a public distribution or in any other manner that
would violate the 1933 Act or the securities or blue sky laws of any state.
3. The Purchaser understands that the Call Warrants have not been and
will not be registered under the 1933 Act or under the securities or blue sky
laws of any state, and that (i) if it decides to resell, pledge or otherwise
transfer any Security, such resale, pledge or other transfer must comply with
the provisions of the Warrant Agent Agreement relating to the Call Warrants
(including, without limitation, the provisions of Section 4.2 thereof) and (ii)
it will, and each subsequent holder will be required to, notify any purchaser of
any Security from it of the resale restrictions referred to in clause (i) above.
4. The Purchaser understands that each of the Call Warrants will bear a
legend substantially to the following effect, unless otherwise agreed by the
Depositor and the Trustee:
"THIS CALL WARRANT (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A
REGISTRATION UNDER SUCH ACT IS IN EFFECT OR PURSUANT TO AN
EXEMPTION THEREFROM UNDER SUCH ACT. THE CALL WARRANT REPRESENTED
HEREBY MAY BE TRANSFERRED ONLY IN COMPLIANCE WITH THE CONDITIONS
SPECIFIED HEREIN OR IN THE SERIES SUPPLEMENT.
EACH PURCHASER OF THIS CALL WARRANT IS HEREBY NOTIFIED THAT THE
SELLER OF THIS CALL WARRANT MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE
144A THEREUNDER."
5. The Purchaser understands that no subsequent transfer of the Call
Warrants is permitted unless (A) such transfer is of a Call Warrant with the
applicable minimum denomination and (B) the Purchaser causes the proposed
transferee to provide to the Depositor and the Trustee such documentation as may
be required pursuant to Section 4.2 of the Warrant Agent Agreement, including,
if required, a letter substantially in the form hereof, or such other written
statement as the Depositor shall reasonably prescribe.
6. The Purchaser is a person or entity (a "Person") who is either
A. (1) a citizen or resident of the United States, (2) a
corporation, partnership or other entity organized in or under the laws
of the United States or any political subdivision thereof, or (3) an
estate the income of which is includible in gross income for federal
income tax purposes regardless of source, or (4) a trust if a court
within the United States is able to exercise primary supervision of the
administration of the trust and one or more United States persons have
the authority to control all substantial decisions of the trust, or
B. a Person not described in (A), whose ownership of such Call
Warrant is effectively connected with such Person's conduct of a trade
or business within the United States within the meaning of the Internal
Revenue Code of 1986, as amended (the "Code"), and its ownership of any
interest in such Call Warrant will not result in any
withholding obligation with respect to any payments with respect to the
Call Warrants by any Person (other than withholding, if any, under
Section 1446 of the Code), or
C. a Person not described in (A) or (B) above, who is not a
Person: (1) that owns, directly or indirectly, 10% or more of the total
combined voting power of all classes of stock in the Underlying
Securities Issuer (as defined in the Prospectus Supplement) entitled to
vote, (2) that is a controlled foreign corporation related to the
Underlying Securities Issuer within the meaning of Section 864(d)(4) of
the Code, or (3) that is a bank extending credit pursuant to a loan
agreement entered into in the ordinary course of its trade or business.
7. The Purchaser agrees that (I) if it is a Person described in clause
(A) above, it will furnish to the Depositor and the Trustee a properly executed
IRS Form W-9, and (II) if it is a Person described in clause (B) above, it will
furnish to the Depositor and the Trustee a properly executed IRS Form W-8ECI,
and (III) if it is a Person described in clause (C) above, it will furnish to
the Depositor and the Trustee a properly executed IRS Form W-8BEN (or, if the
Purchaser is treated as a partnership for federal income tax purposes, a
properly executed IRS Form W-8IMY with appropriate certification for all
partners or members attached). The Purchaser also agrees that it will provide a
new IRS form upon the expiration or obsolescence of any previously delivered
form, and that it will provide such other certifications, representations or
Opinions of Counsel as may be requested by the Depositor and the Trustee.
8. The Purchaser agrees that if at some time in the future it wishes to
transfer or exchange any of the Call Warrants, it will not transfer or exchange
any of the Call Warrants unless such transfer or exchange is in accordance with
the terms of the Warrant Agent Agreement, Series Supplement and other documents
applicable to the Call Warrant. The Purchaser understands that any purported
transfer of the Call Warrants (or any interest therein) in contravention of any
of the restrictions and conditions in the agreements, as applicable, shall be
void, and the purported transferee in such transfer shall not be recognized by
any Person as a holder of such Call Warrants, for any purpose.
You and the Trustee are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Very truly yours,
[Name of Purchaser]
By:
----------------------------
Name:
---------------------------
Title:
---------------------------
