Document:

Gold and GemStone Mining Inc.: Exhibit 10.17 - Filed by newsfilecorp.com

NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED
BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE
CONVERTIBLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE,
SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE
HOLDER), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER
SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.
NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH
A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE
SECURITIES. 

	Principal Amount: $42,500.00 	Issue Date: February 22, 2013 
	Purchase Price: $42,500.00 	  

CONVERTIBLE PROMISSORY NOTE 

          FOR
VALUE RECEIVED, GOLD AND GEMSTONE MINING INC., a Nevada corporation
(hereinafter called the “Borrower”), hereby promises to pay to the order of
ASHER ENTERPRISES, INC., a Delaware corporation, or registered assigns
(the “Holder”) the sum of $42,500.00 together with any interest as set forth
herein, on November 26, 2013 (the “Maturity Date”), and to pay interest on the
unpaid principal balance hereof at the rate of eight percent (8%) (the “Interest
Rate”) per annum from the date hereof (the “Issue Date”) until the same becomes
due and payable, whether at maturity or upon acceleration or by prepayment or
otherwise. This Note may not be prepaid in whole or in part except as otherwise
explicitly set forth herein. Any amount of principal or interest on this Note
which is not paid when due shall bear interest at the rate of twenty two percent
(22%) per annum from the due date thereof until the same is paid (“Default
Interest”). Interest shall commence accruing on the date that the Note is fully
paid and shall be computed on the basis of a 365-day year and the actual number
of days elapsed. All payments due hereunder (to the extent not converted into
common stock, $0.001 par value per share (the “Common Stock”) in accordance with
the terms hereof) shall be made in lawful money of the United States of America.
All payments shall be made at such address as the Holder shall hereafter give to
the Borrower by written notice made in accordance with the provisions of this
Note. Whenever any amount expressed to be due by the terms of this Note is due
on any day which is not a business day, the same shall instead be due on the
next succeeding day which is a business day and, in the case of any interest
payment date which is not the date on which this Note is paid in full, the
extension of the due date thereof shall not be taken into account for purposes
of determining the amount of interest due on such date. As used in this Note,
the term “business day” shall mean any day other than a Saturday, Sunday or a
day on which commercial banks in the city of New York, New York are authorized
or required by law or executive order to remain closed. Each capitalized term
used herein, and not otherwise defined, shall have the meaning ascribed thereto
in that certain Securities Purchase Agreement dated the date hereof, pursuant to
which this Note was originally issued (the “Purchase Agreement”). 

          This
Note is free from all taxes, liens, claims and encumbrances with respect to the
issue thereof and shall not be subject to preemptive rights or other similar
rights of shareholders of the Borrower and will not impose personal liability
upon the holder thereof.

          The
following terms shall apply to this Note: 

ARTICLE I. CONVERSION RIGHTS 

                         1.1
Conversion Right. The Holder shall have the right from time to time, and
at any time during the period beginning on the date which is one hundred eighty
(180) days following the date of this Note and ending on the later of: (i) the
Maturity Date and (ii) the date of payment of the Default Amount (as defined in
Article III) pursuant to Section 1.6(a) or Article III, each in respect of the
remaining outstanding principal amount of this Note to convert all or any part
of the outstanding and unpaid principal amount of this Note into fully paid and
non- assessable shares of Common Stock, as such Common Stock exists on the Issue
Date, or any shares of capital stock or other securities of the Borrower into
which such Common Stock shall hereafter be changed or reclassified at the
conversion price (the “Conversion Price”) determined as provided herein (a
“Conversion”); provided, however, that in no event shall the
Holder be entitled to convert any portion of this Note in excess of that portion
of this Note upon conversion of which the sum of (1) the number of shares of
Common Stock beneficially owned by the Holder and its affiliates (other than
shares of Common Stock which may be deemed beneficially owned through the
ownership of the unconverted portion of the Notes or the unexercised or
unconverted portion of any other security of the Borrower subject to a
limitation on conversion or exercise analogous to the limitations contained
herein) and (2) the number of shares of Common Stock issuable upon the
conversion of the portion of this Note with respect to which the determination
of this proviso is being made, would result in beneficial ownership by the
Holder and its affiliates of more than 9.99% of the outstanding shares of Common
Stock. For purposes of the proviso to the immediately preceding sentence,
beneficial ownership shall be determined in accordance with Section 13(d) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), and
Regulations 13D-G thereunder, except as otherwise provided in clause (1) of such
proviso, provided, further, however, that the limitations
on conversion may be waived by the Holder upon, at the election of the Holder,
not less than 61 days’ prior notice to the Borrower, and the provisions of the
conversion limitation shall continue to apply until such 61st day (or such later
date, as determined by the Holder, as may be specified in such notice of
waiver). The number of shares of Common Stock to be issued upon each conversion
of this Note shall be determined by dividing the Conversion Amount (as defined
below) by the applicable Conversion Price then in effect on the date specified
in the notice of conversion, in the form attached hereto as Exhibit A (the
“Notice of Conversion”), delivered to the Borrower by the Holder in accordance
with Section 1.4 below; provided that the Notice of Conversion is submitted by
facsimile or e-mail (or by other means resulting in, or reasonably expected to
result in, notice) to the Borrower before 6:00 p.m., New York, New York time on
such conversion date (the “Conversion Date”). The term “Conversion Amount”
means, with respect to any conversion of this Note, the sum of (1) the principal
amount of this Note to be converted in such conversion plus (2) at the
Holder’s option, accrued and unpaid interest, if any, on such principal amount
at the interest rates provided in this Note to the Conversion Date, plus
(3) at the Holder’s option, Default Interest, if any, on the amounts referred to
in the immediately preceding clauses (1) and/or (2) plus (4) at the
Holder’s option, any amounts owed to the Holder pursuant to Sections 1.3 and
1.4(g) hereof. 

2 

          1.2
Conversion Price. 

                              (a)
Calculation of Conversion Price. The conversion price (the “Conversion
Price”) shall equal the Variable Conversion Price (as defined herein) (subject
to equitable adjustments for stock splits, stock dividends or rights offerings
by the Borrower relating to the Borrower’s securities or the securities of any
subsidiary of the Borrower, combinations, recapitalization, reclassifications,
extraordinary distributions and similar events). The "Variable Conversion Price"
shall mean 55% multiplied by the Market Price (as defined herein) (representing
a discount rate of 45%). “Market Price” means the average of the lowest two (2)
Trading Prices (as defined below) for the Common Stock during the ninety (90)
Trading Day period ending on the latest complete Trading Day prior to the
Conversion Date. “Trading Price” means, for any security as of any date, the
closing bid price on the Over-the-Counter Bulletin Board, or applicable trading
market (the “OTCBB”) as reported by a reliable reporting service (“Reporting
Service”) designated by the Holder (i.e. Bloomberg) or, if the OTCBB is not the
principal trading market for such security, the closing bid price of such
security on the principal securities exchange or trading market where such
security is listed or traded or, if no closing bid price of such security is
available in any of the foregoing manners, the average of the closing bid prices
of any market makers for such security that are listed in the “pink sheets” by
the National Quotation Bureau, Inc. If the Trading Price cannot be calculated
for such security on such date in the manner provided above, the Trading Price
shall be the fair market value as mutually determined by the Borrower and the
holders of a majority in interest of the Notes being converted for which the
calculation of the Trading Price is required in order to determine the
Conversion Price of such Notes. “Trading Day” shall mean any day on which the
Common Stock is tradable for any period on the OTCBB, or on the principal
securities exchange or other securities market on which the Common Stock is then
being traded.

                              (b)
Conversion Price During Major Announcements. Notwithstanding anything
contained in Section 1.2(a) to the contrary, in the event the Borrower (i) makes
a public announcement that it intends to consolidate or merge with any other
corporation (other than a merger in which the Borrower is the surviving or
continuing corporation and its capital stock is unchanged) or sell or transfer
all or substantially all of the assets of the Borrower or (ii) any person, group
or entity (including the Borrower) publicly announces a tender offer to purchase
50% or more of the Borrower’s Common Stock (or any other takeover scheme) (the
date of the announcement referred to in clause (i) or (ii) is hereinafter
referred to as the “Announcement Date”), then the Conversion Price shall,
effective upon the Announcement Date and continuing through the Adjusted
Conversion Price Termination Date (as defined below), be equal to the lower of
(x) the Conversion Price which would have been applicable for a Conversion
occurring on the Announcement Date and (y) the Conversion Price that would
otherwise be in effect. From and after the Adjusted Conversion Price Termination
Date, the Conversion Price shall be determined as set forth in this Section
1.2(a) . For purposes hereof, “Adjusted Conversion Price Termination Date” shall
mean, with respect to any proposed transaction or tender offer (or takeover
scheme) for which a public announcement as contemplated by this Section 1.2(b)
has been made, the date upon which the Borrower (in the case of clause (i)
above) or the person, group or entity (in the case of clause (ii) above)
consummates or publicly announces the termination or abandonment of the proposed
transaction or tender offer (or takeover scheme) which caused this Section
1.2(b) to become operative. 

3 

               1.3
Authorized Shares. The Borrower covenants that during the period the
conversion right exists, the Borrower will reserve from its authorized and
unissued Common Stock a sufficient number of shares, free from preemptive
rights, to provide for the issuance of Common Stock upon the full conversion of
this Note issued pursuant to the Purchase Agreement. The Borrower is required at
all times to have authorized and reserved five times the number of shares that
is actually issuable upon full conversion of the Note (based on the Conversion
Price of the Notes in effect from time to time)(the “Reserved Amount”). The
Reserved Amount shall be increased from time to time in accordance with the
Borrower’s obligations pursuant to Section 4(g) of the Purchase Agreement. The
Borrower represents that upon issuance, such shares will be duly and validly
issued, fully paid and non-assessable. In addition, if the Borrower shall issue
any securities or make any change to its capital structure which would change
the number of shares of Common Stock into which the Notes shall be convertible
at the then current Conversion Price, the Borrower shall at the same time make
proper provision so that thereafter there shall be a sufficient number of shares
of Common Stock authorized and reserved, free from preemptive rights, for
conversion of the outstanding Notes. The Borrower (i) acknowledges that it has
irrevocably instructed its transfer agent to issue certificates for the Common
Stock issuable upon conversion of this Note, and (ii) agrees that its issuance
of this Note shall constitute full authority to its officers and agents who are
charged with the duty of executing stock certificates to execute and issue the
necessary certificates for shares of Common Stock in accordance with the terms
and conditions of this Note. 

               If,
at any time the Borrower does not maintain the Reserved Amount it will be
considered an Event of Default under Section 3.2 of the Note. 

               1.4
Method of Conversion. 

                              (a)
Mechanics of Conversion. Subject to Section 1.1, this Note may be
converted by the Holder in whole or in part at any time from time to time after
the Issue Date, by (A) submitting to the Borrower a Notice of Conversion (by
facsimile, e-mail or other reasonable means of communication dispatched on the
Conversion Date prior to 6:00 p.m., New York, New York time) and (B) subject to
Section 1.4(b), surrendering this Note at the principal office of the
Borrower.

                              (b)
Surrender of Note Upon Conversion. Notwithstanding anything to the
contrary set forth herein, upon conversion of this Note in accordance with the
terms hereof, the Holder shall not be required to physically surrender this Note
to the Borrower unless the entire unpaid principal amount of this Note is so
converted. The Holder and the Borrower shall maintain records showing the
principal amount so converted and the dates of such conversions or shall use
such other method, reasonably satisfactory to the Holder and the Borrower, so as
not to require physical surrender of this Note upon each such conversion. In the
event of any dispute or discrepancy, such records of the Borrower shall,
prima facie, be controlling and determinative in the absence of
manifest error. Notwithstanding the foregoing, if any portion of this Note is
converted as aforesaid, the Holder may not transfer this Note unless the Holder
first physically surrenders this Note to the Borrower, whereupon the Borrower
will forthwith issue and deliver upon the order of the Holder a new Note of like
tenor, registered as the Holder (upon payment by the Holder of any applicable
transfer taxes) may request, representing in the aggregate the remaining unpaid
principal amount of this Note. The Holder and any assignee, by acceptance of
this Note, acknowledge and agree that, by reason of the provisions of this
paragraph, following conversion of a portion of this Note, the unpaid and
unconverted principal amount of this Note represented by this Note may be less
than the amount stated on the face hereof. 

4 

                              (c) Payment of Taxes. The Borrower shall not be required to pay any tax which
may be payable in respect of any transfer involved in the issue and delivery of
shares of Common Stock or other securities or property on conversion of this
Note in a name other than that of the Holder (or in street name), and the
Borrower shall not be required to issue or deliver any such shares or other
securities or property unless and until the person or persons (other than the
Holder or the custodian in whose street name such shares are to be held for the
Holder’s account) requesting the issuance thereof shall have paid to the
Borrower the amount of any such tax or shall have established to the
satisfaction of the Borrower that such tax has been paid. 

                              (d)
Delivery of Common Stock Upon Conversion. Upon receipt by the Borrower
from the Holder of a facsimile transmission or e-mail (or other reasonable means
of communication) of a Notice of Conversion meeting the requirements for
conversion as provided in this Section 1.4, the Borrower shall issue and deliver
or cause to be issued and delivered to or upon the order of the Holder
certificates for the Common Stock issuable upon such conversion within three (3)
business days after such receipt (the “Deadline”) (and, solely in the case of
conversion of the entire unpaid principal amount hereof, surrender of this Note)
in accordance with the terms hereof and the Purchase Agreement. 

                              (e)
Obligation of Borrower to Deliver Common Stock. Upon receipt by the
Borrower of a Notice of Conversion, the Holder shall be deemed to be the holder
of record of the Common Stock issuable upon such conversion, the outstanding
principal amount and the amount of accrued and unpaid interest on this Note
shall be reduced to reflect such conversion, and, unless the Borrower defaults
on its obligations under this Article I, all rights with respect to the portion
of this Note being so converted shall forthwith terminate except the right to
receive the Common Stock or other securities, cash or other assets, as herein
provided, on such conversion. If the Holder shall have given a Notice of
Conversion as provided herein, the Borrower’s obligation to issue and deliver
the certificates for Common Stock shall be absolute and unconditional,
irrespective of the absence of any action by the Holder to enforce the same, any
waiver or consent with respect to any provision thereof, the recovery of any
judgment against any person or any action to enforce the same, any failure or
delay in the enforcement of any other obligation of the Borrower to the holder
of record, or any setoff, counterclaim, recoupment, limitation or termination,
or any breach or alleged breach by the Holder of any obligation to the Borrower,
and irrespective of any other circumstance which might otherwise limit such
obligation of the Borrower to the Holder in connection with such conversion. The
Conversion Date specified in the Notice of Conversion shall be the Conversion
Date so long as the Notice of Conversion is received by the Borrower before 6:00
p.m., New York, New York time, on such date. 

                              (f)
Delivery of Common Stock by Electronic Transfer. In lieu of delivering
physical certificates representing the Common Stock issuable upon conversion,
provided the Borrower is participating in the Depository Trust Company (“DTC”)
Fast Automated Securities Transfer (“FAST”) program, upon request of the Holder
and its compliance with the provisions contained in Section 1.1 and in this
Section 1.4, the Borrower shall use its best efforts to cause its transfer agent
to electronically transmit the Common Stock issuable upon conversion to the
Holder by crediting the account of Holder’s Prime Broker with DTC through its
Deposit Withdrawal Agent Commission (“DWAC”) system. 

5 

                              (g)
Failure to Deliver Common Stock Prior to Deadline. Without in any way
limiting the Holder’s right to pursue other remedies, including actual damages
and/or equitable relief, the parties agree that if delivery of the Common Stock
issuable upon conversion of this Note is not delivered by the Deadline (other
than a failure due to the circumstances described in Section 1.3 above, which
failure shall be governed by such Section) the Borrower shall pay to the Holder
$2,000 per day in cash, for each day beyond the Deadline that the Borrower fails
to deliver such Common Stock. Such cash amount shall be paid to Holder by the
fifth day of the month following the month in which it has accrued or, at the
option of the Holder (by written notice to the Borrower by the first day of the
month following the month in which it has accrued), shall be added to the
principal amount of this Note, in which event interest shall accrue thereon in
accordance with the terms of this Note and such additional principal amount
shall be convertible into Common Stock in accordance with the terms of this
Note. The Borrower agrees that the right to convert is a valuable right to the
Holder. The damages resulting from a failure, attempt to frustrate, interference
with such conversion right are difficult if not impossible to qualify.
Accordingly the parties acknowledge that the liquidated damages provision
contained in this Section 1.4(g) are justified. 

               1.5
Concerning the Shares. The shares of Common Stock issuable upon
conversion of this Note may not be sold or transferred unless (i) such shares
are sold pursuant to an effective registration statement under the Act or (ii)
the Borrower or its transfer agent shall have been furnished with an opinion of
counsel (which opinion shall be in form, substance and scope customary for
opinions of counsel in comparable transactions) to the effect that the shares to
be sold or transferred may be sold or transferred pursuant to an exemption from
such registration or (iii) such shares are sold or transferred pursuant to Rule
144 under the Act (or a successor rule) (“Rule 144”) or (iv) such shares are
transferred to an “affiliate” (as defined in Rule 144) of the Borrower who
agrees to sell or otherwise transfer the shares only in accordance with this
Section 1.5 and who is an Accredited Investor (as defined in the Purchase
Agreement). Except as otherwise provided in the Purchase Agreement (and subject
to the removal provisions set forth below), until such time as the shares of
Common Stock issuable upon conversion of this Note have been registered under
the Act or otherwise may be sold pursuant to Rule 144 without any restriction as
to the number of securities as of a particular date that can then be immediately
sold, each certificate for shares of Common Stock issuable upon conversion of
this Note that has not been so included in an effective registration statement
or that has not been sold pursuant to an effective registration statement or an
exemption that permits removal of the legend, shall bear a legend substantially
in the following form, as appropriate: 

  
    
      
        
          “NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED
            BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE
            EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
            OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE,
            SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE
            REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS
            AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE
            HOLDER), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER
            SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.
            NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR
            OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.” 

        

      

    

  

6 

               The
legend set forth above shall be removed and the Borrower shall issue to the
Holder a new certificate therefore free of any transfer legend if (i) the
Borrower or its transfer agent shall have received an opinion of counsel, in
form, substance and scope customary for opinions of counsel in comparable
transactions, to the effect that a public sale or transfer of such Common Stock
may be made without registration under the Act, which opinion shall be accepted
by the Company so that the sale or transfer is effected or (ii) in the case of
the Common Stock issuable upon conversion of this Note, such security is
registered for sale by the Holder under an effective registration statement
filed under the Act or otherwise may be sold pursuant to Rule 144 without any
restriction as to the number of securities as of a particular date that can then
be immediately sold. In the event that the Company does not accept the opinion
of counsel provided by the Buyer with respect to the transfer of Securities
pursuant to an exemption from registration, such as Rule 144 or Regulation S, at
the Deadline, it will be considered an Event of Default pursuant to Section 3.2
of the Note. 

               1.6
Effect of Certain Events. 

                              (a)
Effect of Merger, Consolidation, Etc. At the option of the Holder, the
sale, conveyance or disposition of all or substantially all of the assets of the
Borrower, the effectuation by the Borrower of a transaction or series of related
transactions in which more than 50% of the voting power of the Borrower is
disposed of, or the consolidation, merger or other business combination of the
Borrower with or into any other Person (as defined below) or Persons when the
Borrower is not the survivor shall either: (i) be deemed to be an Event of
Default (as defined in Article III) pursuant to which the Borrower shall be
required to pay to the Holder upon the consummation of and as a condition to
such transaction an amount equal to the Default Amount (as defined in Article
III) or (ii) be treated pursuant to Section 1.6(b) hereof. “Person” shall mean
any individual, corporation, limited liability company, partnership,
association, trust or other entity or organization. 

                              (b)
Adjustment Due to Merger, Consolidation, Etc. If, at any time when this
Note is issued and outstanding and prior to conversion of all of the Notes,
there shall be any merger, consolidation, exchange of shares, recapitalization,
reorganization, or other similar event, as a result of which shares of Common
Stock of the Borrower shall be changed into the same or a different number of
shares of another class or classes of stock or securities of the Borrower or
another entity, or in case of any sale or conveyance of all or substantially all
of the assets of the Borrower other than in connection with a plan of complete
liquidation of the Borrower, then the Holder of this Note shall thereafter have
the right to receive upon conversion of this Note, upon the basis and upon the
terms and conditions specified herein and in lieu of the shares of Common Stock
immediately theretofore issuable upon conversion, such stock, securities or
assets which the Holder would have been entitled to receive in such transaction
had this Note been converted in full immediately prior to such transaction
(without regard to any limitations on conversion set forth herein), and in any
such case appropriate provisions shall be made with respect to the rights and
interests of the Holder of this Note to the end that the provisions hereof
(including, without limitation, provisions for adjustment of the Conversion
Price and of the number of shares issuable upon conversion of the Note) shall
thereafter be applicable, as nearly as may be practicable in relation to any
securities or assets thereafter deliverable upon the conversion hereof. The Borrower shall not
affect any transaction described in this Section 1.6(b) unless (a) it first
gives, to the extent practicable, thirty (30) days prior written notice (but in
any event at least fifteen (15) days prior written notice) of the record date of
the special meeting of shareholders to approve, or if there is no such record
date, the consummation of, such merger, consolidation, exchange of shares,
recapitalization, reorganization or other similar event or sale of assets
(during which time the Holder shall be entitled to convert this Note) and (b)
the resulting successor or acquiring entity (if not the Borrower) assumes by
written instrument the obligations of this Section 1.6(b) . The above provisions
shall similarly apply to successive consolidations, mergers, sales, transfers or
share exchanges. 

7 

                              (c)
Adjustment Due to Distribution. If the Borrower shall declare or make any
distribution of its assets (or rights to acquire its assets) to holders of
Common Stock as a dividend, stock repurchase, by way of return of capital or
otherwise (including any dividend or distribution to the Borrower’s shareholders
in cash or shares (or rights to acquire shares) of capital stock of a subsidiary
(i.e., a spin-off)) (a “Distribution”), then the Holder of this Note shall be
entitled, upon any conversion of this Note after the date of record for
determining shareholders entitled to such Distribution, to receive the amount of
such assets which would have been payable to the Holder with respect to the
shares of Common Stock issuable upon such conversion had such Holder been the
holder of such shares of Common Stock on the record date for the determination
of shareholders entitled to such Distribution. 

                              (d)
Adjustment Due to Dilutive Issuance. If, at any time when any Notes are
issued and outstanding, the Borrower issues or sells, or in accordance with this
Section 1.6(d) hereof is deemed to have issued or sold, any shares of Common
Stock for no consideration or for a consideration per share (before deduction of
reasonable expenses or commissions or underwriting discounts or allowances in
connection therewith) less than the Conversion Price in effect on the date of
such issuance (or deemed issuance) of such shares of Common Stock (a “Dilutive
Issuance”), then immediately upon the Dilutive Issuance, the Conversion Price
will be reduced to the amount of the consideration per share received by the
Borrower in such Dilutive Issuance. 

                              The
Borrower shall be deemed to have issued or sold shares of Common Stock if the
Borrower in any manner issues or grants any warrants, rights or options (not
including employee stock option plans), whether or not immediately exercisable,
to subscribe for or to purchase Common Stock or other securities convertible
into or exchangeable for Common Stock (“Convertible Securities”) (such warrants,
rights and options to purchase Common Stock or Convertible Securities are
hereinafter referred to as “Options”) and the price per share for which Common
Stock is issuable upon the exercise of such Options is less than the Conversion
Price then in effect, then the Conversion Price shall be equal to such price per
share. For purposes of the preceding sentence, the “price per share for which
Common Stock is issuable upon the exercise of such Options” is determined by
dividing (i) the total amount, if any, received or receivable by the Borrower as
consideration for the issuance or granting of all such Options, plus the minimum
aggregate amount of additional consideration, if any, payable to the Borrower
upon the exercise of all such Options, plus, in the case of Convertible
Securities issuable upon the exercise of such Options, the minimum aggregate
amount of additional consideration payable upon the conversion or exchange
thereof at the time such Convertible Securities first become convertible or
exchangeable, by (ii) the maximum total number of shares of Common Stock
issuable upon the exercise of all such Options (assuming full conversion of Convertible Securities, if applicable). No further adjustment
to the Conversion Price will be made upon the actual issuance of such Common
Stock upon the exercise of such Options or upon the conversion or exchange of
Convertible Securities issuable upon exercise of such Options. 

8 

                              Additionally,
the Borrower shall be deemed to have issued or sold shares of Common Stock if
the Borrower in any manner issues or sells any Convertible Securities, whether
or not immediately convertible (other than where the same are issuable upon the
exercise of Options), and the price per share for which Common Stock is issuable
upon such conversion or exchange is less than the Conversion Price then in
effect, then the Conversion Price shall be equal to such price per share. For
the purposes of the preceding sentence, the “price per share for which Common
Stock is issuable upon such conversion or exchange” is determined by dividing
(i) the total amount, if any, received or receivable by the Borrower as
consideration for the issuance or sale of all such Convertible Securities, plus
the minimum aggregate amount of additional consideration, if any, payable to the
Borrower upon the conversion or exchange thereof at the time such Convertible
Securities first become convertible or exchangeable, by (ii) the maximum total
number of shares of Common Stock issuable upon the conversion or exchange of all
such Convertible Securities. No further adjustment to the Conversion Price will
be made upon the actual issuance of such Common Stock upon conversion or
exchange of such Convertible Securities. 

                              (e)
Purchase Rights. If, at any time when any Notes are issued and
outstanding, the Borrower issues any convertible securities or rights to
purchase stock, warrants, securities or other property (the “Purchase Rights”)
pro rata to the record holders of any class of Common Stock, then the Holder of
this Note will be entitled to acquire, upon the terms applicable to such
Purchase Rights, the aggregate Purchase Rights which such Holder could have
acquired if such Holder had held the number of shares of Common Stock acquirable
upon complete conversion of this Note (without regard to any limitations on
conversion contained herein) immediately before the date on which a record is
taken for the grant, issuance or sale of such Purchase Rights or, if no such
record is taken, the date as of which the record holders of Common Stock are to
be determined for the grant, issue or sale of such Purchase Rights. 

                              (f)
Notice of Adjustments. Upon the occurrence of each adjustment or
readjustment of the Conversion Price as a result of the events described in this
Section 1.6, the Borrower, at its expense, shall promptly compute such
adjustment or readjustment and prepare and furnish to the Holder a certificate
setting forth such adjustment or readjustment and showing in detail the facts
upon which such adjustment or readjustment is based. The Borrower shall, upon
the written request at any time of the Holder, furnish to such Holder a like
certificate setting forth (i) such adjustment or readjustment, (ii) the
Conversion Price at the time in effect and (iii) the number of shares of Common
Stock and the amount, if any, of other securities or property which at the time
would be received upon conversion of the Note. 

                    1.7
Trading Market Limitations. Unless permitted by the applicable rules and
regulations of the principal securities market on which the Common Stock is then
listed or traded, in no event shall the Borrower issue upon conversion of or
otherwise pursuant to this Note and the other Notes issued pursuant to the
Purchase Agreement more than the maximum number of shares of Common Stock that
the Borrower can issue pursuant to any rule of the principal United States
securities market on which the Common Stock is then traded (the “Maximum Share
Amount”), which shall be 9.99% of the total shares outstanding on the Closing
Date (as defined in the Purchase Agreement), subject to equitable adjustment
from time to time for stock splits, stock dividends, combinations, capital
reorganizations and similar events relating to the Common Stock occurring after
the date hereof. Once the Maximum Share Amount has been issued, if the Borrower
fails to eliminate any prohibitions under applicable law or the rules or
regulations of any stock exchange, interdealer quotation system or other
self-regulatory organization with jurisdiction over the Borrower or any of its
securities on the Borrower’s ability to issue shares of Common Stock in excess
of the Maximum Share Amount, in lieu of any further right to convert this Note,
this will be considered an Event of Default under Section 3.3 of the Note. 

9 

                    1.8
Status as Shareholder. Upon submission of a Notice of Conversion by a
Holder, (i) the shares covered thereby (other than the shares, if any, which
cannot be issued because their issuance would exceed such Holder’s allocated
portion of the Reserved Amount or Maximum Share Amount) shall be deemed
converted into shares of Common Stock and (ii) the Holder’s rights as a Holder
of such converted portion of this Note shall cease and terminate, excepting only
the right to receive certificates for such shares of Common Stock and to any
remedies provided herein or otherwise available at law or in equity to such
Holder because of a failure by the Borrower to comply with the terms of this
Note. Notwithstanding the foregoing, if a Holder has not received certificates
for all shares of Common Stock prior to the tenth (10th) business day after the
expiration of the Deadline with respect to a conversion of any portion of this
Note for any reason, then (unless the Holder otherwise elects to retain its
status as a holder of Common Stock by so notifying the Borrower) the Holder
shall regain the rights of a Holder of this Note with respect to such
unconverted portions of this Note and the Borrower shall, as soon as
practicable, return such unconverted Note to the Holder or, if the Note has not
been surrendered, adjust its records to reflect that such portion of this Note
has not been converted. In all cases, the Holder shall retain all of its rights
and remedies (including, without limitation, (i) the right to receive Conversion
Default Payments pursuant to Section 1.3 to the extent required thereby for such
Conversion Default and any subsequent Conversion Default and (ii) the right to
have the Conversion Price with respect to subsequent conversions determined in
accordance with Section 1.3) for the Borrower’s failure to convert this Note.

                    1.9
Prepayment. Notwithstanding anything to the contrary contained in this
Note, at any time during the period beginning on the Issue Date and ending on
the date which is thirty (30) days following the issue date, the Borrower shall
have the right, exercisable on not less than three (3) Trading Days prior
written notice to the Holder of the Note to prepay the outstanding Note
(principal and accrued interest), in full, in accordance with this Section 1.9.
Any notice of prepayment hereunder (an “Optional Prepayment Notice”) shall be
delivered to the Holder of the Note at its registered addresses and shall state:
(1) that the Borrower is exercising its right to prepay the Note, and (2) the
date of prepayment which shall be not more than three (3) Trading Days from the
date of the Optional Prepayment Notice. On the date fixed for prepayment (the
“Optional Prepayment Date”), the Borrower shall make payment of the Optional
Prepayment Amount (as defined below) to or upon the order of the Holder as
specified by the Holder in writing to the Borrower at least one (1) business day
prior to the Optional Prepayment Date. If the Borrower exercises its right to
prepay the Note, the Borrower shall make payment to the Holder of an amount in
cash (the “Optional Prepayment Amount”) equal to 125%, multiplied by the sum of:
(w) the then outstanding principal amount of this Note plus (x) accrued
and unpaid interest on the unpaid principal amount of this Note to the Optional
Prepayment Date plus (y) Default Interest, if any, on the amounts
referred to in clauses (w) and (x) plus (z) any amounts owed to the
Holder pursuant to Sections 1.3 and 1.4(g) hereof. If the Borrower delivers an
Optional Prepayment Notice and fails to pay the Optional Prepayment Amount due
to the Holder of the Note within two (2) business days following the Optional
Prepayment Date, the Borrower shall forever forfeit its right to prepay the Note
pursuant to this Section 1.9. 

10 

                    Notwithstanding
anything to the contrary contained in this Note, at any time during the period
beginning on the date which is thirty-one (31) days following the issue date and
ending on the date which is sixty (60) days following the issue date, the
Borrower shall have the right, exercisable on not less than three (3) Trading
Days prior written notice to the Holder of the Note to prepay the outstanding
Note (principal and accrued interest), in full, in accordance with this Section
1.9. Any Optional Prepayment Notice shall be delivered to the Holder of the Note
at its registered addresses and shall state: (1) that the Borrower is exercising
its right to prepay the Note, and (2) the date of prepayment which shall be not
more than three (3) Trading Days from the date of the Optional Prepayment
Notice. On the Optional Prepayment Date, the Borrower shall make payment of the
Second Optional Prepayment Amount (as defined below) to or upon the order of the
Holder as specified by the Holder in writing to the Borrower at least one (1)
business day prior to the Optional Prepayment Date. If the Borrower exercises
its right to prepay the Note, the Borrower shall make payment to the Holder of
an amount in cash (the “Second Optional Prepayment Amount”) equal to 130%,
multiplied by the sum of: (w) the then outstanding principal amount of this Note
plus (x) accrued and unpaid interest on the unpaid principal amount of
this Note to the Optional Prepayment Date plus (y) Default Interest, if
any, on the amounts referred to in clauses (w) and (x) plus (z) any
amounts owed to the Holder pursuant to Sections 1.3 and 1.4(g) hereof. If the
Borrower delivers an Optional Prepayment Notice and fails to pay the Second
Optional Prepayment Amount due to the Holder of the Note within two (2) business
days following the Optional Prepayment Date, the Borrower shall forever forfeit
its right to prepay the Note pursuant to this Section 1.9. 

                    Notwithstanding
anything to the contrary contained in this Note, at any time during the period
beginning on the date which is sixty-one (61) days following the issue date and
ending on the date which is ninety (90) days following the issue date, the
Borrower shall have the right, exercisable on not less than three (3) Trading
Days prior written notice to the Holder of the Note to prepay the outstanding
Note (principal and accrued interest), in full, in accordance with this Section
1.9. Any Optional Prepayment Notice shall be delivered to the Holder of the Note
at its registered addresses and shall state: (1) that the Borrower is exercising
its right to prepay the Note, and (2) the date of prepayment which shall be not
more than three (3) Trading Days from the date of the Optional Prepayment
Notice. On the Optional Prepayment Date, the Borrower shall make payment of the
Third Optional Prepayment Amount (as defined below) to or upon the order of the
Holder as specified by the Holder in writing to the Borrower at least one (1)
business day prior to the Optional Prepayment Date. If the Borrower exercises
its right to prepay the Note, the Borrower shall make payment to the Holder of
an amount in cash (the “Third Optional Prepayment Amount”) equal to 135%,
multiplied by the sum of: (w) the then outstanding principal amount of this Note
plus (x) accrued and unpaid interest on the unpaid principal amount of
this Note to the Optional Prepayment Date plus (y) Default Interest, if
any, on the amounts referred to in clauses (w) and (x) plus (z) any
amounts owed to the Holder pursuant to Sections 1.3 and 1.4(g) hereof. If the
Borrower delivers an Optional Prepayment Notice and fails to pay the Third
Optional Prepayment Amount due to the Holder of the Note within two (2) business
days following the Optional Prepayment Date, the Borrower shall forever forfeit
its right to prepay the Note pursuant to this Section 1.9. 

11 

                    Notwithstanding
any to the contrary stated elsewhere herein, at any time during the period
beginning on the date that is ninety-one (91) day from the issue date and ending
one hundred twenty (120) days following the issue date, the Borrower shall have
the right, exercisable on not less than three (3) Trading Days prior written
notice to the Holder of the Note to prepay the outstanding Note (principal and
accrued interest), in full, in accordance with this Section 1.9. Any Optional
Prepayment Notice shall be delivered to the Holder of the Note at its registered
addresses and shall state: (1) that the Borrower is exercising its right to
prepay the Note, and (2) the date of prepayment which shall be not more than
three (3) Trading Days from the date of the Optional Prepayment Notice. On the
Optional Prepayment Date, the Borrower shall make payment of the Fourth Optional
Prepayment Amount (as defined below) to or upon the order of the Holder as
specified by the Holder in writing to the Borrower at least one (1) business day
prior to the Optional Prepayment Date. If the Borrower exercises its right to
prepay the Note, the Borrower shall make payment to the Holder of an amount in
cash (the “Fourth Optional Prepayment Amount”) equal to 140%, multiplied by the
sum of: (w) the then outstanding principal amount of this Note plus (x)
accrued and unpaid interest on the unpaid principal amount of this Note to the
Optional Prepayment Date plus (y) Default Interest, if any, on the
amounts referred to in clauses (w) and (x) plus (z) any amounts owed to
the Holder pursuant to Sections 1.3 and 1.4(g) hereof. If the Borrower delivers
an Optional Prepayment Notice and fails to pay the Fourth Optional Prepayment
Amount due to the Holder of the Note within two (2) business days following the
Optional Prepayment Date, the Borrower shall forever forfeit its right to prepay
the Note pursuant to this Section 1.9. 

                    Notwithstanding
any to the contrary stated elsewhere herein, at any time during the period
beginning on the date that is one hundred twenty-one (121) day from the issue
date and ending one hundred fifty (150) days following the issue date, the
Borrower shall have the right, exercisable on not less than three (3) Trading
Days prior written notice to the Holder of the Note to prepay the outstanding
Note (principal and accrued interest), in full, in accordance with this Section
1.9. Any Optional Prepayment Notice shall be delivered to the Holder of the Note
at its registered addresses and shall state: (1) that the Borrower is exercising
its right to prepay the Note, and (2) the date of prepayment which shall be not
more than three (3) Trading Days from the date of the Optional Prepayment
Notice. On the Optional Prepayment Date, the Borrower shall make payment of the
Fifth Optional Prepayment Amount (as defined below) to or upon the order of the
Holder as specified by the Holder in writing to the Borrower at least one (1)
business day prior to the Optional Prepayment Date. If the Borrower exercises
its right to prepay the Note, the Borrower shall make payment to the Holder of
an amount in cash (the “Fifth Optional Prepayment Amount”) equal to 145%,
multiplied by the sum of: (w) the then outstanding principal amount of this Note
plus (x) accrued and unpaid interest on the unpaid principal amount of
this Note to the Optional Prepayment Date plus (y) Default Interest, if
any, on the amounts referred to in clauses (w) and (x) plus (z) any
amounts owed to the Holder pursuant to Sections 1.3 and 1.4(g) hereof. If the
Borrower delivers an Optional Prepayment Notice and fails to pay the Fifth
Optional Prepayment Amount due to the Holder of the Note within two (2) business
days following the Optional Prepayment Date, the Borrower shall forever forfeit
its right to prepay the Note pursuant to this Section 1.9. 

                    Notwithstanding
any to the contrary stated elsewhere herein, at any time during the period
beginning on the date that is one hundred fifty-one (151) day from the issue
date and ending one hundred eighty (180) days following the issue date, the
Borrower shall have the right, exercisable on not less than three (3) Trading
Days prior written notice to the Holder of the Note to prepay the outstanding
Note (principal and accrued interest), in full, in accordance with this Section 1.9. Any Optional Prepayment Notice shall be delivered
to the Holder of the Note at its registered addresses and shall state: (1) that
the Borrower is exercising its right to prepay the Note, and (2) the date of
prepayment which shall be not more than three (3) Trading Days from the date of
the Optional Prepayment Notice. On the Optional Prepayment Date, the Borrower
shall make payment of the Sixth Optional Prepayment Amount (as defined below) to
or upon the order of the Holder as specified by the Holder in writing to the
Borrower at least one (1) business day prior to the Optional Prepayment Date. If
the Borrower exercises its right to prepay the Note, the Borrower shall make
payment to the Holder of an amount in cash (the “Sixth Optional Prepayment
Amount”) equal to 150%, multiplied by the sum of: (w) the then outstanding
principal amount of this Note plus (x) accrued and unpaid interest on the
unpaid principal amount of this Note to the Optional Prepayment Date plus (y) Default Interest, if any, on the amounts referred to in clauses (w) and (x) plus (z) any amounts owed to the Holder pursuant to Sections 1.3 and
1.4(g) hereof. If the Borrower delivers an Optional Prepayment Notice and fails
to pay the Sixth Optional Prepayment Amount due to the Holder of the Note within
two (2) business days following the Optional Prepayment Date, the Borrower shall
forever forfeit its right to prepay the Note pursuant to this Section 1.9. 

12 

                    After
the expiration of one hundred eighty (180) following the date of the Note, the
Borrower shall have no right of prepayment. 

ARTICLE II. CERTAIN COVENANTS 

                    2.1
Distributions on Capital Stock. So long as the Borrower shall have any
obligation under this Note, the Borrower shall not without the Holder’s written
consent (a) pay, declare or set apart for such payment, any dividend or other
distribution (whether in cash, property or other securities) on shares of
capital stock other than dividends on shares of Common Stock solely in the form
of additional shares of Common Stock or (b) directly or indirectly or through
any subsidiary make any other payment or distribution in respect of its capital
stock except for distributions pursuant to any shareholders’ rights plan which
is approved by a majority of the Borrower’s disinterested directors. 

                    2.2
Restriction on Stock Repurchases. So long as the Borrower shall have any
obligation under this Note, the Borrower shall not without the Holder’s written
consent redeem, repurchase or otherwise acquire (whether for cash or in exchange
for property or other securities or otherwise) in any one transaction or series
of related transactions any shares of capital stock of the Borrower or any
warrants, rights or options to purchase or acquire any such shares. 

                    2.3
Borrowings. So long as the Borrower shall have any obligation under this
Note, the Borrower shall not, without the Holder’s written consent, create,
incur, assume guarantee, endorse, contingently agree to purchase or otherwise
become liable upon the obligation of any person, firm, partnership, joint
venture or corporation, except by the endorsement of negotiable instruments for
deposit or collection, or suffer to exist any liability for borrowed money,
except (a) borrowings in existence or committed on the date hereof and of which
the Borrower has informed Holder in writing prior to the date hereof, (b)
indebtedness to trade creditors or financial institutions incurred in the
ordinary course of business or (c) borrowings, the proceeds of which shall be
used to repay this Note. 

13 

                    2.4
Sale of Assets. So long as the Borrower shall have any obligation under
this Note, the Borrower shall not, without the Holder’s written consent, sell,
lease or otherwise dispose of any significant portion of its assets outside the
ordinary course of business. Any consent to the disposition of any assets may be
conditioned on a specified use of the proceeds of disposition. 

                    2.5
Advances and Loans. So long as the Borrower shall have any obligation
under this Note, the Borrower shall not, without the Holder’s written consent,
lend money, give credit or make advances to any person, firm, joint venture or
corporation, including, without limitation, officers, directors, employees,
subsidiaries and affiliates of the Borrower, except loans, credits or advances
(a) in existence or committed on the date hereof and which the Borrower has
informed Holder in writing prior to the date hereof, (b) made in the ordinary
course of business or (c) not in excess of $100,000. 

ARTICLE III. EVENTS OF DEFAULT 

                    If
any of the following events of default (each, an “Event of Default”) shall
occur: 

                    3.1
Failure to Pay Principal or Interest. The Borrower fails to pay the
principal hereof or interest thereon when due on this Note, whether at maturity,
upon acceleration or otherwise. 

                    3.2
Conversion and the Shares. The Borrower fails to issue shares of Common
Stock to the Holder (or announces or threatens in writing that it will not honor
its obligation to do so) upon exercise by the Holder of the conversion rights of
the Holder in accordance with the terms of this Note, fails to transfer or cause
its transfer agent to transfer (issue) (electronically or in certificated form)
any certificate for shares of Common Stock issued to the Holder upon conversion
of or otherwise pursuant to this Note as and when required by this Note, the
Borrower directs its transfer agent not to transfer or delays, impairs, and/or
hinders its transfer agent in transferring (or issuing) (electronically or in
certificated form) any certificate for shares of Common Stock to be issued to
the Holder upon conversion of or otherwise pursuant to this Note as and when
required by this Note, or fails to remove (or directs its transfer agent not to
remove or impairs, delays, and/or hinders its transfer agent from removing) any
restrictive legend (or to withdraw any stop transfer instructions in respect
thereof) on any certificate for any shares of Common Stock issued to the Holder
upon conversion of or otherwise pursuant to this Note as and when required by
this Note (or makes any written announcement, statement or threat that it does
not intend to honor the obligations described in this paragraph) and any such
failure shall continue uncured (or any written announcement, statement or threat
not to honor its obligations shall not be rescinded in writing) for three (3)
business days after the Holder shall have delivered a Notice of Conversion. It
is an obligation of the Borrower to remain current in its obligations to its
transfer agent. It shall be an event of default of this Note, if a conversion of
this Note is delayed, hindered or frustrated due to a balance owed by the
Borrower to its transfer agent. If at the option of the Holder, the Holder
advances any funds to the Borrower’s transfer agent in order to process a
conversion, such advanced funds shall be paid by the Borrower to the Holder
within forty eight (48) hours of a demand from the Holder. 

                    3.3
Breach of Covenants. The Borrower breaches any material covenant or other
material term or condition contained in this Note and any collateral documents
including but not limited to the Purchase Agreement and such breach continues for
a period of ten (10) days after written notice thereof to the Borrower from the
Holder. 

14 

                    3.4
Breach of Representations and Warranties. Any representation or warranty
of the Borrower made herein or in any agreement, statement or certificate given
in writing pursuant hereto or in connection herewith (including, without
limitation, the Purchase Agreement), shall be false or misleading in any
material respect when made and the breach of which has (or with the passage of
time will have) a material adverse effect on the rights of the Holder with
respect to this Note or the Purchase Agreement. 

                    3.5
Receiver or Trustee. The Borrower or any subsidiary of the Borrower shall
make an assignment for the benefit of creditors, or apply for or consent to the
appointment of a receiver or trustee for it or for a substantial part of its
property or business, or such a receiver or trustee shall otherwise be
appointed. 

                    3.6
Judgments. Any money judgment, writ or similar process shall be entered
or filed against the Borrower or any subsidiary of the Borrower or any of its
property or other assets for more than $50,000, and shall remain unvacated,
unbonded or unstayed for a period of twenty (20) days unless otherwise consented
to by the Holder, which consent will not be unreasonably withheld. 

                    3.7
Bankruptcy. Bankruptcy, insolvency, reorganization or liquidation
proceedings or other proceedings, voluntary or involuntary, for relief under any
bankruptcy law or any law for the relief of debtors shall be instituted by or
against the Borrower or any subsidiary of the Borrower. 

                    3.8
Delisting of Common Stock. The Borrower shall fail to maintain the
listing of the Common Stock on at least one of the OTCBB or an equivalent
replacement exchange, the Nasdaq National Market, the Nasdaq SmallCap Market,
the New York Stock Exchange, or the American Stock Exchange. 

                    3.9
Failure to Comply with the Exchange Act. The Borrower shall fail to
comply with the reporting requirements of the Exchange Act; and/or the Borrower
shall cease to be subject to the reporting requirements of the Exchange Act.

                    3.10
Liquidation. Any dissolution, liquidation, or winding up of Borrower or
any substantial portion of its business. 

                    3.11
Cessation of Operations. Any cessation of operations by Borrower or
Borrower admits it is otherwise generally unable to pay its debts as such debts
become due, provided, however, that any disclosure of the Borrower’s ability to
continue as a “going concern” shall not be an admission that the Borrower cannot
pay its debts as they become due. 

                    3.12
Maintenance of Assets. The failure by Borrower to maintain any material
intellectual property rights, personal, real property or other assets which are
necessary to conduct its business (whether now or in the future). 

                    3.13
Financial Statement Restatement. The restatement of any financial
statements filed by the Borrower with the SEC for any date or period from two
years prior to the Issue Date of this Note and until this Note is no longer
outstanding, if the result of such restatement would, by comparison to the
unrestated financial statement, have constituted a material adverse effect on
the rights of the Holder with respect to this Note or the Purchase Agreement.

15 

                    3.14
Reverse Splits. The Borrower effectuates a reverse split of its Common
Stock without twenty (20) days prior written notice to the Holder. 

                    3.15
Replacement of Transfer Agent. In the event that the Borrower proposes to
replace its transfer agent, the Borrower fails to provide, prior to the
effective date of such replacement, a fully executed Irrevocable Transfer Agent
Instructions in a form as initially delivered pursuant to the Purchase Agreement
(including but not limited to the provision to irrevocably reserve shares of
Common Stock in the Reserved Amount) signed by the successor transfer agent to
Borrower and the Borrower. 

                    3.16
Cross-Default. Notwithstanding anything to the contrary contained in this
Note or the other related or companion documents, a breach or default by the
Borrower of any covenant or other term or condition contained in any of the
Other Agreements, after the passage of all applicable notice and cure or grace
periods, shall, at the option of the Holder, be considered a default under this
Note and the Other Agreements, in which event the Holder shall be entitled (but
in no event required) to apply all rights and remedies of the Holder under the
terms of this Note and the Other Agreements by reason of a default under said
Other Agreement or hereunder. “Other Agreements” means, collectively, all
agreements and instruments between, among or by: (1) the Borrower, and, or for
the benefit of, (2) the Holder and any affiliate of the Holder, including,
without limitation, promissory notes; provided, however, the term “Other
Agreements” shall not include the related or companion documents to this Note.
Each of the loan transactions will be cross-defaulted with each other loan
transaction and with all other existing and future debt of Borrower to the
Holder. 

                    Upon
the occurrence and during the continuation of any Event of Default specified in
Section 3.1 (solely with respect to failure to pay the principal hereof or
interest thereon when due at the Maturity Date), the Note shall become
immediately due and payable and the Borrower shall pay to the Holder, in full
satisfaction of its obligations hereunder, an amount equal to the Default Sum
(as defined herein). UPON THE OCCURRENCE AND DURING THE CONTINUATION OF ANY
EVENT OF DEFAULT SPECIFIED IN SECTION 3.2, THE NOTE SHALL BECOME IMMEDIATELY DUE
AND PAYABLE AND THE BORROWER SHALL PAY TO THE HOLDER, IN FULL SATISFACTION OF
ITS OBLIGATIONS HEREUNDER, AN AMOUNT EQUAL TO: (Y) THE DEFAULT SUM (AS DEFINED
HEREIN); MULTIPLIED BY (Z) TWO (2). Upon the occurrence and during the
continuation of any Event of Default specified in Sections 3.1 (solely with
respect to failure to pay the principal hereof or interest thereon when due on
this Note upon a Trading Market Prepayment Event pursuant to Section 1.7 or upon
acceleration), 3.3, 3.4, 3.6, 3.8, 3.9, 3.11, 3.12, 3.13, 3.14, and/or 3. 15
exercisable through the delivery of written notice to the Borrower by such
Holders (the “Default Notice”), and upon the occurrence of an Event of Default
specified the remaining sections of Articles III (other than failure to pay the
principal hereof or interest thereon at the Maturity Date specified in Section
3,1 hereof), the Note shall become immediately due and payable and the Borrower
shall pay to the Holder, in full satisfaction of its obligations hereunder, an amount equal to the greater of (i) 150% times the sum of (w) the then outstanding principal amount of this Note plus (x) accrued and unpaid interest on the unpaid principal amount of this Note to
the date of payment (the “Mandatory Prepayment Date”) plus (y) Default
Interest, if any, on the amounts referred to in clauses (w) and/or (x) plus (z) any amounts owed to the Holder pursuant to Sections 1.3 and
1.4(g) hereof (the then outstanding principal amount of this Note to the date of
payment plus the amounts referred to in clauses (x), (y) and (z) shall
collectively be known as the “Default Sum”) or (ii) the “parity value” of the
Default Sum to be prepaid, where parity value means (a) the highest number of
shares of Common Stock issuable upon conversion of or otherwise pursuant to such
Default Sum in accordance with Article I, treating the Trading Day immediately
preceding the Mandatory Prepayment Date as the “Conversion Date” for purposes of
determining the lowest applicable Conversion Price, unless the Default Event
arises as a result of a breach in respect of a specific Conversion Date in which
case such Conversion Date shall be the Conversion Date), multiplied by (b) the highest Closing Price for the Common Stock during the period beginning
on the date of first occurrence of the Event of Default and ending one day prior
to the Mandatory Prepayment Date (the “Default Amount”) and all other amounts
payable hereunder shall immediately become due and payable, all without demand,
presentment or notice, all of which hereby are expressly waived, together with
all costs, including, without limitation, legal fees and expenses, of
collection, and the Holder shall be entitled to exercise all other rights and
remedies available at law or in equity.

16 

                    If
the Borrower fails to pay the Default Amount within five (5) business days of
written notice that such amount is due and payable, then the Holder shall have
the right at any time, so long as the Borrower remains in default (and so long
and to the extent that there are sufficient authorized shares), to require the
Borrower, upon written notice, to immediately issue, in lieu of the Default
Amount, the number of shares of Common Stock of the Borrower equal to the
Default Amount divided by the Conversion Price then in effect. 

ARTICLE IV. MISCELLANEOUS 

                    4.1
Failure or Indulgence Not Waiver. No failure or delay on the part of the
Holder in the exercise of any power, right or privilege hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise of any such power,
right or privilege preclude other or further exercise thereof or of any other
right, power or privileges. All rights and remedies existing hereunder are
cumulative to, and not exclusive of, any rights or remedies otherwise available.

                    4.2
Notices. All notices, demands, requests, consents, approvals, and other
communications required or permitted hereunder shall be in writing and, unless
otherwise specified herein, shall be (i) personally served, (ii) deposited in
the mail, registered or certified, return receipt requested, postage prepaid,
(iii) delivered by reputable air courier service with charges prepaid, or (iv)
transmitted by hand delivery, telegram, or facsimile, addressed as set forth
below or to such other address as such party shall have specified most recently
by written notice. Any notice or other communication required or permitted to be
given hereunder shall be deemed effective (a) upon hand delivery or delivery by
facsimile, with accurate confirmation generated by the transmitting facsimile
machine, at the address or number designated below (if delivered on a business
day during normal business hours where such notice is to be received), or the
first business day following such delivery (if delivered other than on a
business day during normal business hours where such notice is to be received)
or (b) on the second business day following the date of mailing by express
courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever
shall first occur. The addresses for such communications shall be:

17 

If to the Borrower, to:

GOLD AND GEMSTONE MINING INC. 
2144
Whitekirk Way 
Draper, UT 84020 
Attn: CHARMAINE KING, Chief Executive
Officer 
facsimile:

With a copy by fax only to (which copy
shall not constitute notice): 

[enter name of law firm] 
Attn:
[attorney name] 
[enter address line 1] 
[enter city, state, zip]

facsimile: [enter fax number] 

If to the Holder: 

ASHER ENTERPRISES, INC. 
1 Linden
Pl., Suite 207 
Great Neck, NY. 11021 
Attn: Curt Kramer,
President
facsimile: 516-498-9894 

With a copy by fax only to (which copy
shall not constitute notice): 

Naidich Wurman Birnbaum & Maday,
LLP 
80 Cuttermill Road, Suite 410 
Great Neck, NY 11021 
Attn: Bernard
S. Feldman, Esq. 
facsimile: 516-466-3555 

                    4.3
Amendments. This Note and any provision hereof may only be amended by an
instrument in writing signed by the Borrower and the Holder. The term “Note” and
all reference thereto, as used throughout this instrument, shall mean this
instrument (and the other Notes issued pursuant to the Purchase Agreement) as
originally executed, or if later amended or supplemented, then as so amended or
supplemented. 

                    4.4
Assignability. This Note shall be binding upon the Borrower and its
successors and assigns, and shall inure to be the benefit of the Holder and its
successors and assigns. Each transferee of this Note must be an “accredited
investor” (as defined in Rule 501(a) of the 1933 Act). Notwithstanding anything
in this Note to the contrary, this Note may be pledged as collateral in connection with a bona fide margin account or other lending arrangement. 

18 

                    4.5
Cost of Collection. If default is made in the payment of this Note, the
Borrower shall pay the Holder hereof costs of collection, including reasonable
attorneys’ fees. 

                    4.6
Governing Law. This Note shall be governed by and construed in accordance
with the laws of the State of New York without regard to principles of conflicts
of laws. Any action brought by either party against the other concerning the
transactions contemplated by this Note shall be brought only in the state courts
of New York or in the federal courts located in the state and county of Nassau.
The parties to this Note hereby irrevocably waive any objection to jurisdiction
and venue of any action instituted hereunder and shall not assert any defense
based on lack of jurisdiction or venue or based upon forum non
conveniens. The Borrower and Holder waive trial by jury. The prevailing
party shall be entitled to recover from the other party its reasonable
attorney's fees and costs. In the event that any provision of this Note or any
other agreement delivered in connection herewith is invalid or unenforceable
under any applicable statute or rule of law, then such provision shall be deemed
inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law. Any such provision which
may prove invalid or unenforceable under any law shall not affect the validity
or enforceability of any other provision of any agreement. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any suit, action or proceeding in connection with this Agreement or
any other Transaction Document by mailing a copy thereof via registered or
certified mail or overnight delivery (with evidence of delivery) to such party
at the address in effect for notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any other manner permitted by law. 

                    4.7
Certain Amounts. Whenever pursuant to this Note the Borrower is required
to pay an amount in excess of the outstanding principal amount (or the portion
thereof required to be paid at that time) plus accrued and unpaid interest plus
Default Interest on such interest, the Borrower and the Holder agree that the
actual damages to the Holder from the receipt of cash payment on this Note may
be difficult to determine and the amount to be so paid by the Borrower
represents stipulated damages and not a penalty and is intended to compensate
the Holder in part for loss of the opportunity to convert this Note and to earn
a return from the sale of shares of Common Stock acquired upon conversion of
this Note at a price in excess of the price paid for such shares pursuant to
this Note. The Borrower and the Holder hereby agree that such amount of
stipulated damages is not plainly disproportionate to the possible loss to the
Holder from the receipt of a cash payment without the opportunity to convert
this Note into shares of Common Stock. 

                    4.8
Purchase Agreement. By its acceptance of this Note, each party agrees to
be bound by the applicable terms of the Purchase Agreement. 

                    4.9
Notice of Corporate Events. Except as otherwise provided below, the
Holder of this Note shall have no rights as a Holder of Common Stock unless and
only to the extent that it converts this Note into Common Stock. The Borrower
shall provide the Holder with prior notification of any meeting of the
Borrower’s shareholders (and copies of proxy materials and other information
sent to shareholders). In the event of any taking by the Borrower of a record
of its shareholders for the purpose of determining shareholders
who are entitled to receive payment of any dividend or other distribution, any
right to subscribe for, purchase or otherwise acquire (including by way of
merger, consolidation, reclassification or recapitalization) any share of any
class or any other securities or property, or to receive any other right, or for
the purpose of determining shareholders who are entitled to vote in connection
with any proposed sale, lease or conveyance of all or substantially all of the
assets of the Borrower or any proposed liquidation, dissolution or winding up of
the Borrower, the Borrower shall mail a notice to the Holder, at least twenty
(20) days prior to the record date specified therein (or thirty (30) days prior
to the consummation of the transaction or event, whichever is earlier), of the
date on which any such record is to be taken for the purpose of such dividend,
distribution, right or other event, and a brief statement regarding the amount
and character of such dividend, distribution, right or other event to the extent
known at such time. The Borrower shall make a public announcement of any event
requiring notification to the Holder hereunder substantially simultaneously with
the notification to the Holder in accordance with the terms of this Section 4.9.

19 

                    4.10
Remedies. The Borrower acknowledges that a breach by it of its
obligations hereunder will cause irreparable harm to the Holder, by vitiating
the intent and purpose of the transaction contemplated hereby. Accordingly, the
Borrower acknowledges that the remedy at law for a breach of its obligations
under this Note will be inadequate and agrees, in the event of a breach or
threatened breach by the Borrower of the provisions of this Note, that the
Holder shall be entitled, in addition to all other available remedies at law or
in equity, and in addition to the penalties assessable herein, to an injunction
or injunctions restraining, preventing or curing any breach of this Note and to
enforce specifically the terms and provisions thereof, without the necessity of
showing economic loss and without any bond or other security being required.

                    IN
WITNESS WHEREOF, Borrower has caused this Note to be signed in its name by its
duly authorized officer this February 22, 2013. 

GOLD AND GEMSTONE MINING INC.

	 	By:	 
	 	 	CHARMAINE KING 
	 	 	Chief Executive Officer
  

20 

EXHIBIT A 
NOTICE OF CONVERSION

                    The
undersigned hereby elects to convert $_________________ principal amount
of the Note (defined below) into that number of shares of Common Stock to be
issued pursuant to the conversion of the Note (“Common Stock”) as set forth
below, of GOLD AND GEMSTONE MINING INC., a Nevada corporation (the “Borrower”)
according to the conditions of the convertible note of the Borrower dated as of
February 22, 2013 (the “Note”), as of the date written below. No fee will be
charged to the Holder for any conversion, except for transfer taxes, if any.

Box Checked as to applicable instructions: 

	 	[   ] 	The Borrower shall electronically
      transmit the Common Stock issuable pursuant to this Notice of Conversion
      to the account of the undersigned or its nominee with DTC through its
      Deposit Withdrawal Agent Commission system (“DWAC Transfer”). 
	 	  	  
	 	  	Name of DTC Prime Broker: 
	 	  	Account Number: 
	 	  	  
	 	[   ] 	The undersigned hereby requests
      that the Borrower issue a certificate or certificates for the number of
      shares of Common Stock set forth below (which numbers are based on the
      Holder’s calculation attached hereto) in the name(s) specified immediately
      below or, if additional space is necessary, on an attachment hereto:

	 	  	  
	 	  	ASHER ENTERPRISES, INC. 
	 	  	1 Linden Pl., Suite 207 
	 	  	Great Neck, NY. 11021 
	 	  	Attention: Certificate Delivery
    
	 	  	(516) 498-9890

	 	Date of Conversion: 	 
    
	 	Applicable Conversion Price: 	$
	 	Number of Shares of Common Stock to be Issued 	  
	 	     Pursuant to Conversion of the Notes:
	 
    
	 	Amount of Principal Balance Due remaining 	  
	 	     Under the Note after this conversion:
    	 
    

ASHER ENTERPRISES, INC. 

By:_____________________________
Name: Curt Kramer 
Title:
President 
Date: ______________
1 Linden Pl., Suite 207 
Great Neck,
NY. 11021 

21ex4-1.htm

Exhibit 4.1

 

 

 

BASE TRUST AGREEMENT

 

FOR TRUSTS SPONSORED BY

 

STRUCTURED PRODUCTS CORP.

 

Dated as of [________], 2013

 

  

 

  

 

 

TABLE OF CONTENTS

	 	
ARTICLE I

	
DEFINITIONS AND ASSUMPTIONS

	
1

	 	
Section 1.1

	
Definitions

	
1

	 	
Section 1.2

	
Rules of Construction

	
14

	 	
ARTICLE II

	
DECLARATION OF TRUSTS; ISSUANCE OF CERTIFICATES

	
14

	 	
Section 2.1

	
Creation and Declaration of Trusts; Assignment of Underlying Securities

	
14

	 	
Section 2.2

	
Acceptance by Trustee

	
14

	 	       Section 2.3	        Reserved   	
14

	 	
Section 2.4

	
Representations and Warranties of the Depositor and Representations, Warranties and Covenants of the Administrative Agent

	
15

	 	
Section 2.5

	
Breach of Representation, Warranty or Covenant

	
16

	 	
Section 2.6

	
Agreement to Authenticate and Deliver Certificates

	
16

	 	
Section 2.7

	
Statement of Intent

	
16

	 	
Section 2.8

	
Acknowledgment Concerning the Underwriter

	
17

	 	
ARTICLE III

	
ADMINISTRATION OF EACH TRUST

	
17

	 	
Section 3.1

	
Administration of Each Trust

	
17

	 	
Section 3.2

	
Sub-Administration Agreements Between Administrative Agent or Trustee and Sub-Administrative Agents

	
18

	 	
Section 3.3

	
Successor Sub-Administrative Agents

	
19

	 	
Section 3.4

	
Liability of the Administrative Agent

	
19

	 	
Section 3.5

	
No Contractual Relationship Between Certain Sub-Administrative Agents and Trustee or Certificateholders

	
19

	 	
Section 3.6

	
Assumption or Termination of Sub-Administration Agreements by Trustee

	
20

	 	
Section 3.7

	
Collection of Certain Underlying Security Payments

	
20

	 	
Section 3.8

	
Collections by Sub-Administrative Agent

	
20

	 	
Section 3.9

	
Certificate Account

	
20

	 	
Section 3.10

	
Investment of Funds in the Accounts

	
22

	 	
Section 3.11

	
Maintenance of Credit Support

	
23

	 	
Section 3.12

	
Realization Upon Defaulted Underlying Securities

	
23

	 	
Section 3.13

	
Retained Interest

	
25

 

 

  

-i-

  

 

TABLE OF CONTENTS

(continued)

 

	 	
Section 3.14

	
Administrative Agent’s Compensation and Reimbursement

	
25

	 	
Section 3.15

	
Statement as to Compliance

	
25

	 	
Section 3.16

	
[Intentionally Omitted

	
26

	 	
Section 3.17

	
Access to Certain Documentation

	
26

	 	
Section 3.18

	
Duties of the Administrative Agent

	
26

	 	
Section 3.19

	
Depositor to Furnish Names and Addresses of Holders to Trustee

	
26

	 	
Section 3.20

	
Preservation of Information, Communications to Holders

	
26

	 	
ARTICLE IV

	
DISTRIBUTIONS AND REPORTS TO CERTIFICATEHOLDERS

	
27

	 	
Section 4.1

	
Distributions

	
27

	 	
Section 4.2

	
Reports to Certificateholders

	
27

	 	
Section 4.3

	
Advances

	
28

	 	
Section 4.4

	
Compliance with Withholding Requirements

	
29

	 	
Section 4.5

	
Optional Exchange

	
29

	 	
ARTICLE V

	
THE CERTIFICATES

	
31

	 	
Section 5.1

	
The Certificates

	
31

	 	
Section 5.2

	
Execution, Authentication and Delivery

	
35

	 	
Section 5.3

	
Temporary Certificates

	
35

	 	
Section 5.4

	
Registration; Registration of Transfer and Exchange

	
36

	 	
Section 5.5

	
Mutilated, Destroyed, Lost and Stolen Certificates

	
38

	 	
Section 5.6

	
Distribution of Interest; Interest Rights Preserved

	
39

	 	
Section 5.7

	
Persons Deemed Owners

	
40

	 	
Section 5.8

	
Cancellation

	
40

	 	
Section 5.9

	
Global Securities

	
40

	 	
Section 5.10

	
Notices to Depositary

	
40

	 	
Section 5.11

	
Definitive Certificates

	
41

	 	
Section 5.12

	
Currency of Distributions in Respect of Certificates

	
41

	 	
Section 5.13

	
Conditions of Authentication and Delivery of New Series

	
42

	 	
Section 5.14

	
Appointment of Paying Agent

	
43

	 	
Section 5.15

	
Authenticating Agent

	
44

 

 

  

-ii-

  

TABLE OF CONTENTS

(continued)

 

	 	
Section 5.16

	
Events of Default

	
45

	 	
Section 5.17

	
Control by Holders

	
45

	 	
Section 5.18

	
Waiver of Past Defaults

	
45

	 	
ARTICLE VI

	
THE DEPOSITOR AND THE ADMINISTRATIVE AGENT

	
46

	 	
Section 6.1

	
Preparation and Filing of Exchange Act Reports; Obligations of the Depositor and the Administrative Agent

	
46

	 	
Section 6.2

	
Merger or Consolidation of the Depositor or the Administrative Agent

	
50

	 	
Section 6.3

	
Limitation on Liability of the Depositor and the Administrative Agent

	
51

	 	
Section 6.4

	
Limitation on Resignation of the Administrative Agent

	
52

	 	
Section 6.5

	
Rights of the Depositor in Respect of the Administrative Agent

	
52

	 	
Section 6.6

	
Depositor May Purchase Certificates

	
53

	 	
Section 6.7

	
The Administrative Agent and Other Parties

	
53

	 	
Section 6.8

	
Preferential Collection of Claims Against Depositor

	
53

	 	
ARTICLE VII

	
ADMINISTRATIVE AGENT TERMINATION EVENTS

	
53

	 	
Section 7.1

	
Administrative Agent Termination Events

	
53

	 	
Section 7.2

	
Trustee to Act; Appointment of Successor

	
55

	 	
Section 7.3

	
Notification to Certificateholders

	
55

	 	
Section 7.4

	
Waiver of Administrative Agent Termination Events

	
56

	 	
ARTICLE VIII

	
CONCERNING THE TRUSTEE

	
56

	 	
Section 8.1

	
Duties of Trustee; Notice of Defaults

	
56

	 	
Section 8.2

	
Certain Matters Affecting the Trustee

	
58

	 	
Section 8.3

	
Trustee Not Liable for Recitals in Certificates or Underlying Securities

	
60

	 	
Section 8.4

	
Trustee May Own Certificates

	
60

	 	
Section 8.5

	
Trustee’s Fees and Expenses; Indemnification; Undertaking for Costs

	
61

	 	
Section 8.6

	
Eligibility Requirements for Trustee

	
62

	 	
Section 8.7

	
Resignation or Removal of the Trustee

	
62

	 	
Section 8.8

	
Successor Trustee

	
63

	 	
Section 8.9

	
Merger or Consolidation of Trustee

	
63

 

 

  

-iii-

  

TABLE OF CONTENTS

(continued)

 

	 	
Section 8.10

	
Appointment of Co-Trustee or Separate Trustee

	
63

	 	
Section 8.11

	
Appointment of Office or Agency

	
64

	 	
Section 8.12

	
Representations and Warranties of Trustee

	
64

	 	
Section 8.13

	
Trustee to Act Only in Accordance With This Agreement or Pursuant to Instructions of Certificateholders

	
65

	 	
Section 8.14

	
Accounting and Reports to Certificateholders, Internal Revenue Service and Others

	
65

	 	
Section 8.15

	
Signature on Returns

	
65

	 	
ARTICLE IX

	
TERMINATION

	
66

	 	
Section 9.1

	
Termination upon Purchase or Liquidation of All Underlying Securities

	
66

	 	
ARTICLE X

	
MISCELLANEOUS PROVISIONS

	
67

	 	
Section 10.1

	
Amendment

	
67

	 	
Section 10.2

	
Counterparts

	
68

	 	
Section 10.3

	
Limitation on Rights of Certificateholders

	
68

	 	
Section 10.4

	
Governing Law

	
69

	 	
Section 10.5

	
Notices

	
69

	 	
Section 10.6

	
Severability of Provisions

	
70

	 	
Section 10.7

	
Notice to Rating Agency

	
70

	 	
Section 10.8

	
Grant of Security Interest

	
70

	 	
Section 10.9

	
Nonpetition Covenant

	
71

	 	
Section 10.10

	
No Recourse

	
71

	 	
Section 10.11

	
Article and Section References

	
71

	 	
Section 10.12

	
Conflict with Trust Indenture Act

	
72

 

  

-iv-

  

THIS BASE TRUST AGREEMENT is dated as of [_________], 2013, and will be incorporated by reference into a Series Supplement between STRUCTURED PRODUCTS CORP., a Delaware corporation, as Depositor or Trustor, and a trustee appointed under such Series Supplement.  This Base Trust Agreement and the applicable Series Supplement are collectively referred to herein as the Trust Agreement.

 

PRELIMINARY STATEMENT

 

The Depositor and the Trustee have duly authorized the execution and delivery of this Trust Agreement to provide for one or more Series (and one or more Classes within each such Series) of Trust Certificates, issuable from time to time as provided in this Agreement.  Each such Series (or each Class within such Series) of Certificates will be issued only under a separate Series Supplement to this Agreement duly executed and delivered by the Depositor, the Administrative Agent, if any, specified in the applicable Series Supplement, and the Trustee.  All representations, covenants and agreements made herein by each of the Depositor, the Administrative Agent, if any, and the Trustee are for the benefit and security of the Certificateholders and, to the extent provided in the applicable Series Supplement, for the benefit and security of any Credit Support Provider.  The Depositor is entering into this Agreement, and the Trustee is accepting the trusts created hereby, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged.

 

ARTICLE I

 

DEFINITIONS AND ASSUMPTIONS

 

Section 1.1 Definitions.    Except as otherwise specified herein or in the applicable Series Supplement or as the context may otherwise require, the following terms have the respective meanings set forth below for all purposes of this Agreement.

 

“Account”:  As defined in Section 3.10.

 

“Accounting Date”:  With respect to any Series, if applicable, as defined in the related Series Supplement.

 

“Accreted Amount”:  With respect to each Series, if applicable, as defined in the related Series Supplement.

 

“Administrative Agent”:  With respect to any Series of Certificates, the Person, if any, specified in the applicable Series Supplement for such Series (which Person shall have agreed pursuant to such Series Supplement to assume all the duties, obligations, responsibilities and liabilities of the Administrative Agent as set forth in this Agreement and such Series Supplement with respect to such Series), until a successor Person shall have become the Administrative Agent pursuant to the applicable provisions of this Agreement and such Series Supplement, and thereafter “Administrative Agent” shall mean such successor Person.

 

 

  

1

  

 

“Administrative Agent Termination Event”:  As defined in Section 7.1.

 

“Administrative Fee”:  With respect to each Series, if applicable, as defined in the related Series Supplement.

 

“Advance”:  As defined in Section 4.3.

 

“Affiliate”:  With respect to any specified Person, any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person.  For the purposes of this definition, “control,” when used with respect to any specified Person, means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

 

“Agreement”:  With respect to any Series of Certificates, this Trust Agreement and all amendments hereof and, unless the context otherwise requires, the related Series Supplement.

 

“Authenticating Agent”:  As defined in Section 5.15.

 

“Authorized Newspaper”:  A newspaper in an official language of the country of publication customarily published at least once a day, and customarily published for at least five days in each calendar week, and of general circulation in such city or cities specified pursuant to Section 5.1 with respect to the Certificates of any Series. Where successive publications are required to be made in Authorized Newspapers, the successive publications may be made in the same or in different newspapers in the same city meeting the foregoing requirements and in each case on any Business Day in such city.

 

“Available Funds”:  Unless otherwise specified in the applicable Series Supplement, for any Distribution Date in respect of a given Series or Class, the sum of (i) all amounts actually received on or with respect to the Underlying Securities (including Liquidation Proceeds and investment income on amounts in the Accounts) with respect to such Series during the related Collection Period, (ii) all amounts received pursuant to any Credit Support Instruments with respect to such Series for such Distribution Date and (iii) all other amounts, if any, specified by the applicable Series Supplement.

 

“Basic Documents”:  With respect to any Series, if applicable, as defined in the related Series Supplement.

 

“Board of Directors”:  Either the Board of Directors of the Depositor or any executive or committee of such Board duly authorized under applicable law to act on behalf of such Board.

 

“Board Resolution”:  A copy of a resolution certified by the Secretary or an Assistant Secretary of the Depositor to have been duly adopted by the Board of Directors and to be in full force and effect on the date of such certification and delivery to the Trustee.

 

“Business Day”:  With respect to any Place of Distribution specified pursuant to Section 5.1, any day that is not a Saturday, a Sunday or a legal holiday or a day on which banking institutions or trust companies in such Place of Distribution are authorized or obligated by law, regulation or executive order to close or any day which is not a business day with respect to the Underlying Securities, except as otherwise specified pursuant to Section 5.1.

 

  

2

  

 

 

“Calculation Agent”:  With respect to each Series, as defined in the related Series Supplement.

 

“Call Premium Percentage”:  With respect to any Series (or Class within such Series), if applicable, as defined in the related Series Supplement.

 

“Certificate Account”:  As defined in Section 3.9.

 

“Certificate Owner”:  With respect to any Certificate in a Series or Class of Certificates held in book-entry form, the owner of beneficial interests in such Certificate.  With respect to any Definitive Certificate in any Series or Class of Certificates, the holder of such Definitive Certificate.

 

“Certificate Principal Balance”:  With respect to an Outstanding Certificate, as determined at any time, the maximum amount that the Holder thereof is entitled to receive as distributions allocable to principal payments on the Underlying Securities.  The Certificate Principal Balance, if any, of any Class within a given Series (other than those Classes, if any, specified in the related Series Supplement), as of any date of determination, shall be equal to the aggregate initial Certificate Principal Balance thereof less the sum of (i) all amounts allocable to prior distributions made to such Class in respect of principal of the Underlying Securities and (ii) any reductions attributable to Certificates surrendered in exchange for Underlying Securities, as and to the extent provided in the applicable Series Supplement.

 

“Certificate Register” and “Certificate Registrar”:  As respectively defined in Section 5.4.

 

“Certificateholder” or “Holder””  With respect to any Series (or Class within such Series), as defined in the related Series Supplement.

 

“Certificates”:  Any Trust Certificates authorized by, and authenticated and delivered under, this Agreement.

 

“Class”:  With respect to any Series, any one of the classes of Certificates of such Series, each consisting of Certificates having identical terms.

 

“Closing Date”:  With respect to any Series, the day on which Certificates of such Series are first executed, authenticated and delivered.

 

“Code”:  The Internal Revenue Code of 1986, as amended.

 

“Collection Period”:  With respect to any Distribution Date for a Series (or Class within such Series), the period specified in the related Series Supplement.

 

“Commission”:  The Securities and Exchange Commission, as from time to time constituted, created under the Exchange Act or, if at any time after the execution and delivery of this Agreement such Commission is not existing and performing the duties now assigned to it, then the body then performing such duties.

 

 

  

3

  

 

“Corporate Trust Office”:  The principal corporate trust office of the Trustee located at the address set forth in the related Series Supplement or such other addresses as the Trustee may designate from time to time by notice to the Holders, the Administrative Agent, if any, and the Depositor, or the principal corporate trust office of any successor Trustee (or such other addresses as a successor Trustee may designate from time to time by notice to the Holders, the Administrative Agent, if any, and the Depositor).

 

“Credit Support”:  With respect to any Series (or any Class within such Series), a letter of credit, surety bond, swap agreement, put or call option or other asset intended to support or ensure the timely or ultimate distributions of amounts due in respect of all or certain of the Underlying Securities for such Series or Class, which in each case is specified as such in the related Series Supplement.

 

“Credit Support Instrument”:  The instrument or document pursuant to which the Credit Support for a given Series (or any Class within such Series) is provided, as specified in the applicable Series Supplement.

 

“Credit Support Provider”:  With respect to any Series (or any Class within such Series), the Person, if any, that will provide any Credit Support with respect to all or a portion of the Underlying Securities for such Series or Class as specified in the applicable Series Supplement.

 

“Currency”:  Dollars or Foreign Currency.

 

“Cut-off Date”:  With respect to any Series, the date specified as such in the related Series Supplement. For purposes of this Agreement, any Underlying Security acquired by the Depositor after the applicable Cut-off Date but prior to the applicable Closing Date and transferred to the related Trust as of such Closing Date shall be deemed to have been Outstanding as of such Cut-off Date and references to the principal balance of such Underlying Security as of such Cut-off Date shall be deemed to be to the principal balance of such Underlying Security as of the date on which it was acquired by the Depositor.

 

“Definitive Certificates”:  As defined in Section 5.9.

 

“Depositary”:  With respect to the Certificates of any Series (or Class within such Series) issuable in whole or in part in the form of one or more Global Securities, the Person designated as Depositary by the Depositor pursuant to Section 5.1 until a successor Depositary shall have become such pursuant to the applicable provisions of this Agreement, and thereafter “Depositary” shall mean or include each Person who is then a Depositary hereunder, and if at any time there is more than one such Person, “Depositary” as used with respect to the Certificates of any such Series or Class shall mean the Depositary with respect to the Certificates of that Series or Class.

 

“Depositor”:  Structured Products Corp., a Delaware corporation, in its capacity as Depositor and, if a successor Person shall have become the Depositor pursuant to any applicable provisions of this Agreement, “Depositor” shall mean such successor Person.

 

 

  

4

  

 

“Depositor Order” or “Depositor Request”:  A written order or request, respectively, signed in the name of the Depositor by any of its Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, President, a Vice President, its Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary and delivered to the Trustee.

 

“Depository Agreement”:  If applicable, the agreement pursuant to which the Depositary will agree to act as Depositary with respect to any Series (or Class within such Series) of Certificates in accordance with Section 5.9.

 

“Discount Certificate”:  Any Certificate with respect to which the Certificateholder will be treated as receiving “original issue discount” within the meaning of Section 1273(a) of the Code and any other Certificate designated by the Depositor as a Discount Certificate.

 

“Distribution Date”:  With respect to any Series (or Class within such Series) of Certificates, each date specified as a “Distribution Date” for such Series (or Class) in the related Series Supplement.

 

“Dollar” or “$” or “USD”:  Such currency of the United States as at the time of payment is legal tender for the payment of public and private debts.

 

“Eligible Account”:  Either (i) an account or accounts maintained with a Federal or State chartered depository institution or trust company the long term unsecured debt obligations of which are rated by the Rating Agency the higher of (x) at least the then current long-term rating of the Underlying Securities or (y) in one of its two highest long-term rating categories (unless otherwise specified in the Series Supplement) at the time any amounts or property is held therein or (ii) a trust account maintained with the corporate trust department of a federal depository institution or state-chartered depository institution subject to regulations regarding fiduciary funds on deposit similar to Title 12 of the U.S. Code of Federal Regulations Section 9.10(b) and, in either case, the trust department has corporate trust powers and is acting in its fiduciary capacity.

 

“Event of Default”:  With respect to any Series (or Class within such Series) of Certificates, as specified in the related Series Supplement.

 

“Exchange Act”:  The Securities Exchange Act of 1934, as amended.

 

“Exchange Rate Agent”:  With respect to any Series (or Class within such Series) of Certificates, if applicable, the Depositor or its agent so specified in the related Series Supplement.

 

“Executive Officer”:  With respect to any corporation, the Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, President, any Vice President, the Secretary or the Treasurer of such corporation; with respect to any partnership, any general partner thereof.

 

“Extraordinary Trust Expense”:  With respect to any Series, as specified in the related Series Supplement.

 

 

 

  

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“Final Scheduled Distribution Date”:  With respect to each Series, as defined in the Series Supplement.

 

“Fixed Pass Through Rate”:  With respect to any Fixed Rate Certificate, as defined in the related Series Supplement.

 

“Fixed Rate Certificate”:  A Certificate that provides for a payment of interest at a Fixed Pass Through Rate.

 

“Floating Pass Through Rate”:  With respect to any Floating Rate Certificate, as defined in the related Series Supplement.

 

“Floating Rate Certificate”:  A Certificate that provides for the payment of interest at a Floating Pass Through Rate determined periodically by reference to a formula specified pursuant to Section 5.1 and the related Series Supplement.

 

“Foreign Currency”:  A currency issued by the government of any country other than the United States or a composite currency the value of which is determined by reference to the values of the currencies of any group of countries.

 

“Global Security”:  A Certificate evidencing all or part of a Series (or Class within such Series) of Certificates, issued to the Depositary for such Series or Class in accordance with Section 5.9 and bearing the legend prescribed therein.

 

“Guaranteed Investment Contract”:  With respect to any Series (or Class within such Series), a guaranteed investment contract or surety bond provided for in the related Series Supplement, sold to the Trust for the benefit of the Certificateholders for such Series, providing for the investment of funds in a related Account or related Accounts and insuring a minimum or a fixed rate of return on the investment of such funds, which contract or surety bond shall be an obligation of an insurance company or other entity whose rating at the time of purchase of such guaranteed investment contract or surety bond is no lower than the rating on the Underlying Securities and shall satisfy any other requirements specified in such Series Supplement.

 

“Independent”:  When used with respect to any specified Person means that the Person specifies he or she (1) is in fact independent of the Depositor and the Administrative Agent, if any, and of any Affiliate of any of the foregoing Persons, (2) does not have any direct or indirect financial interest in the Depositor or the Administrative Agent, if any, or in any Affiliate of either of the foregoing Persons which is material with respect to such Person and (3) is not connected with the Depositor or the Administrative Agent, if any, as an officer, employee, promoter, underwriter, trustee, partner, director or person performing similar functions.

 

“Independent Certificate” means a certificate of an Independent Person, as required by the TIA.

 

“Letter of Credit”:  With respect to any Series or Class within such Series, the letter of credit, if any, providing for the payment of all or a portion of amounts due in respect of such Series or Class, issued to the Trustee for the benefit of the Holders of such Series or Class, issued by the related Credit Support Provider, all as specified in the related Series Supplement.

 

 

  

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“Limited Guarantor”:  With respect to the Underlying Securities relating to any Series (or Class within such Series), a Person specified in the related Series Supplement as providing a guarantee or insurance policy or other credit enhancement supporting the distributions in respect of such Series (or Class) as and to the extent specified in such Series Supplement.

 

“Limited Guaranty”:  With respect to any Series or Class within such Series, any guarantee of or insurance policy or other comparable form of credit enhancement with respect to amounts required to be distributed in respect of such Series or Class or payments under all or certain of the Underlying Securities relating to such Series or Class, executed and delivered by a Limited Guarantor in favor of the Trustee, for the benefit of the Certificateholders, as specified in the related Series Supplement.

 

“Liquidation Proceeds”:  The amounts received by the Administrative Agent, if any, or the Trustee in connection with the liquidation of a defaulted Underlying Security or collateral, if any, related thereto.

 

“Notional Amount”:  With respect to any Class of Certificates, if applicable, the initial notional amount specified in the related Series Supplement on which distributions of interest may be determined at the applicable Pass Through Rate, as the same may be adjusted as specified in such Series Supplement.

 

“Officer’s Certificate”:  A certificate signed by any one (or, if specified in this Agreement or any Series Supplement, more than one) Executive Officer of the Depositor or Administrative Agent, as applicable.

 

“Opinion of Counsel”:  A written opinion of counsel, who may, except as otherwise expressly provided in this Agreement, be counsel for the Depositor or the Administrative Agent, if any, acceptable to the Trustee, except that any opinion of counsel relating to the qualification of any account required to be maintained pursuant to this Agreement as an Eligible Account must state that it is an opinion of counsel who is in fact Independent of the Depositor and the Administrative Agent, if any.

 

“Optional Exchange Date”:  With respect to any Series (or Class with such Series), as defined, if applicable, in the related Series Supplement.

 

“Outstanding”:  With respect to Certificates of a specified Series (or Class within such Series), as of any date of determination, all such Certificates theretofore authenticated and delivered under this Agreement and the related Series Supplement except:

 

(i)   Certificates theretofore cancelled by the Certificate Registrar or delivered to the Certificate Registrar for cancellation; and

 

(ii)   Certificates in exchange for or in lieu of which other Certificates have been authenticated and delivered pursuant to this Agreement, unless proof satisfactory to the Trustee is presented that any such Certificates are held by a protected purchaser;

 

 

  

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provided, however, that in determining whether the Holders of the required percentage of the aggregate Voting Rights of the Certificates have given any request, demand, authorization, direction, notice, consent or waiver hereunder, Certificates beneficially owned by the Depositor, or any Affiliate thereof, shall be disregarded and deemed not to be Outstanding, and the Voting Rights to which its Holder would otherwise be entitled shall not be taken into account in determining whether the requisite percentage of aggregate Voting Rights necessary to effect any such consent or take any such action has been obtained except that, in determining whether the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Certificates with respect to which the Depositor has provided the Trustee an Officer’s Certificate stating that such Certificates are so owned shall be so disregarded.  Certificates so owned that have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee by certifying to such effect in an Officer’s Certificate the pledgee’s right so to act with respect to such Certificates and that the pledgee is not, to the actual knowledge of the Trustee without any duty of investigation, the Depositor, the Administrative Agent, if any, or any Affiliate of any thereof so owned. The principal amount or notional amount, as applicable, of a Discount Certificate that shall be deemed to be Outstanding for the determination referred to in the foregoing proviso shall be the Certificate Principal Balance or Certificate Notional Amount, as applicable, with respect thereto as of the date of such determination, and the principal amount or notional amount, as applicable, of a Certificate denominated in a Foreign Currency that shall be deemed to be Outstanding for purposes of the determination referred to in the foregoing provision shall be the amount calculated pursuant to Section 5.12(c).

 

“Participant”:  A broker, dealer, bank, other financial institution or other Person for whom from time to time a Depositary effects book-entry transfers and pledges of securities deposited with the Depositary.

 

“Pass Through Rate”:  With respect to any Series (or Class within such Series) of Certificates (except certain Discount Certificates and Certificates entitled to nominal or no interest distributions) the annual rate at which interest accrues on the Certificates of such Series (or Class), which may be a fixed rate or a floating rate of interest, determined upon the basis and in the manner specified in the related Series Supplement.

 

“Paying Agent”:  As defined in Section 5.14.

 

“Percentage Interest”:  With respect to a Certificate of any Series or Class within a Series, the portion of such Series or Class evidenced by such Certificate, expressed as a percentage, equal to the product of (x) a fraction, the numerator of which is the initial Certificate Principal Balance or Notional Amount, as applicable, represented by such Certificate and the denominator of which is the aggregate initial Certificate Principal Balance or Notional Amount, as applicable, of all the Certificates of such Series or Class and (y) 100.

 

 

 

  

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“Permitted Investments”:  With respect to any Series, unless otherwise specified in the related Series Supplement, any one or more of the following obligations or securities, provided that the total return specified by the terms of each such obligation or security is at least equal to the purchase price thereof:

 

(i)   direct obligations of, and obligations fully guaranteed by, the United States, the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association, the Federal Farm Credit System or any agency or instrumentality of the United States the obligations of which are backed by the full faith and credit of the United States of America; provided that obligations of, or guaranteed by, the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association or the Federal Farm Credit System shall be Permitted Investments only if, at the time of investment, it has the rating specified in such Series Supplement for Permitted Investments;

 

(ii)   demand and time deposits in, certificates of deposit of, or banker’s acceptances issued by any depository institution (including the Trustee or any agent of the Trustee acting in their respective commercial capacities) incorporated under the laws of the United States or any State and subject to supervision and examination by Federal and/or State banking authorities so long as the commercial paper and/or the short-term debt obligations of such depository institution (or, in the case of a depository institution which is the principal subsidiary of a holding company, the commercial paper or other short-term debt obligations of such holding company) at the time of such investment or contractual commitment providing for such investment have the rating specified in such Series Supplement for Permitted Investments; provided, however, that such rating shall be no lower than the rating on the Underlying Securities at the time of purchase of the investments;

 

(iii)   repurchase agreements with respect to (a) any security described in clause (i) above or (b) any other security issued or guaranteed by an agency or instrumentality of the United States, with an entity having the credit rating specified in such Series Supplement for Permitted Investments;

 

(iv)   securities bearing interest or sold at a discount issued by any corporation incorporated under the laws of the United States or any State that have the rating specified in such Series Supplement for Permitted Investments at the time of such investment or contractual commitment providing for such investment; provided, however, that such rating shall be no lower than the rating on the Underlying Securities; provided further that securities issued by any particular corporation will not be Permitted Investments to the extent that investment therein will cause the then outstanding principal amount of securities issued by such corporation and held as an asset of the Trust for such Series to exceed 10% of the aggregate outstanding principal balances and amounts of all the Underlying Securities and Permitted Investments held as assets of the Trust for such Series;

 

(v)   commercial paper having at the time of such investment the rating specified in the Series Supplement for Permitted Investments; and

 

(vi)   a Guaranteed Investment Contract if and only if specified in the related Series Supplement, provided that the Rating Agency Condition is met.

 

 

  

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“Person”:  Any individual, corporation, partnership, joint venture, association, joint stock company, limited liability company, trust, unincorporated organization or government or any agency or political subdivision thereof.

 

“Place of Distribution”:  With respect to any Series (or Class within such Series) of Certificates, the place or places where the principal of (and premium, if any) and interest on the Certificates of such Series (or Class) are distributable as specified pursuant to Section 5.1.

 

“Predecessor Certificate”:  With respect to any particular Certificate, every previous Certificate evidencing all or a portion of the same interest as that evidenced by such particular Certificate; and, for the purpose of this definition, any Certificate authenticated and delivered under Section 5.5 in lieu of a lost, destroyed or stolen Certificate shall be deemed to evidence the same interest as the lost, destroyed or stolen Certificate.

 

“Proceeding”:  Any suit in equity, action at law or other judicial or administrative proceeding.

 

“Rating Agency”:  With respect to any Series (or Class within such Series), as defined in the related Series Supplement.

 

“Rating Agency Condition”:  With respect to any action or occurrence, unless otherwise specified in the applicable Series Supplement, that each Rating Agency shall have been given 10 days (or such shorter period acceptable to each Rating Agency) prior notice thereof and that each Rating Agency shall have notified the Depositor, the Trustee and the Administrative Agent, if any, in writing that such action or occurrence will not result in a reduction or withdrawal of the then current rating of any Certificate of the applicable Series.

 

“Record Date”:  With respect to any Distribution Date for any Series (or Class within such Series) of Certificates, the date specified in the related Series Supplement.

 

“Regulation AB” Means Subpart 229.1100 – Asset Backed Securities (Regulation AB), 17 C.F.R. §§229.1100-229.1123, as such may be amended from time to time, and subject to such clarification and interpretation as have been provided by the Commission in the adopting release (Asset-Backed Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff of the Commission, or as may be provided by the Commission or its staff from time to time.

 

“Required Interest”:  Unless otherwise specified in the related Series Supplement, with respect to the Outstanding Certificates of any Series or any Class thereof, the accrued and undistributed interest on the Certificate Principal Balance or Notional Amount of such Outstanding Certificates computed at the applicable Pass Through Rate.

 

“Required Percentage--Amendment”:  Unless otherwise specified in the related Series Supplement, 66 2/3% of the aggregate Voting Rights of Certificates of such Series (or of a designated Class or group of Classes within such Series) (either voting as separate Classes or as a single Class) applicable to such matter, all as specified in the applicable Series Supplement.

 

 

  

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“Required Percentage--Definitive Certificates”: Unless otherwise specified in the related Series Supplement, greater than 50% of the aggregate Voting Rights of Certificates of such Series.

 

“Required Percentage--Direction of Trustee”: Unless otherwise specified in the related Series Supplement, greater than 50% of the aggregate Voting Rights of Certificates of such Series.

 

“Required Percentage--Remedies”:  Unless otherwise specified in the related Series Supplement, 66 2/3% of the aggregate Voting Rights of Certificates of such Series.

 

“Required Percentage--Removal of Trustee”:  Unless otherwise specified in the related Series Supplement, greater than 50% of the aggregate Voting Rights of Certificates of such Series.

 

“Required Percentage--Waiver”:  Unless otherwise specified in the related Series Supplement, 66 2/3% of the aggregate Voting Rights of Certificates of such Series.

 

“Required Premium”:  If applicable, unless otherwise specified in the related Series Supplement, with respect to the Certificates of any Series or any Class thereof, an amount equal to the product, as determined on any Distribution Date with respect to such Series or Class, of (i) the Required Principal for such Series or Class and (ii) the Call Premium Percentage for such Series or Class.

 

“Required Principal”:  As determined for any Distribution Date for a given Series (or Class within such Series), unless otherwise specified in the related Series Supplement, the amounts on deposit in the Certificate Account allocable to principal payments on the Underlying Securities (including from Credit Support, if any, and Advances, if any, but excluding amounts in respect of principal payments to the extent that Advances with respect thereto were distributed as Required Principal on a prior Distribution Date) and required to be distributed in respect of Certificates of such Series (or Class) in accordance with the terms of such Certificates and such related Series Supplement.

 

“Required Rating”:  With respect to any Series (or Class within such Series), the rating category (or categories) specified in the Series Supplement that, as a condition to the issuance of such Series or Class, is (or are) the lowest category (or categories) in which the Certificates of such Series or Class may be categorized by the Rating Agency.

 

“Requisite Reserve Amount”:  As of any date with respect to any Series (or Class within such Series) of Certificates, the amount, if any, required to be maintained in the Reserve Account, if any, for such Series or Class as specified in or determined pursuant to the related Series Supplement.

 

“Reserve Account”:  An Eligible Account, if any, created and maintained pursuant to Section 3.11.

 

 

 

  

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“Responsible Officer”:  With respect to the Trustee, any officer within the Corporate Trust Office of the Trustee who has direct responsibility for the administration of this Agreement.

 

“Retained Interest”:  If applicable, with respect to any Underlying Security, an ownership interest in and a right to a portion of the payments thereon by the obligor thereof, as specified in the Underlying Securities Schedule to the related Series Supplement, held by the Person so specified in such Underlying Securities Schedule.

 

“Scheduled Final Distribution Date”:  With respect to any Certificate, the date on which all the unpaid principal of (and premium, if any, on) such Certificate is scheduled, without giving effect to any prepayment, exchange or early termination, to become due and payable as provided therein and in the applicable Series Supplement.

 

“Seller”:  As defined in the Series Supplement.

 

“Series”:  A separate series of Certificates issued pursuant to this Agreement and a related Series Supplement, which series may be divided into two or more Classes, as provided in such Series Supplement.

 

“Series Supplement”:  An agreement supplemental to this Agreement that authorizes the issuance of a particular Series (and each Class within such Series) of Certificates.

 

“Specified Currency”:  As defined in the related Series Supplement.

 

“State”:  Any one of the 50 states of the United States or the District of Columbia.

 

“Sub-Administration Account”:  As defined in Section 3.8.

 

“Sub-Administration Agreement”:  The written contract, if any, between the Administrative Agent, if any, specified in the applicable Series Supplement, or Trustee and a Sub-Administrative Agent and any successor Administrative Agent or Trustee or Sub-Administrative Agent relating to the administration of a Underlying Security or certain Underlying Securities as provided in Section 3.2.

 

“Sub-Administrative Agent”:  Any Person with which the Administrative Agent, if any, specified in the applicable Series Supplement, or the Trustee has entered into a Sub-Administration Agreement and which meets the qualifications of a Sub-Administrative Agent pursuant to Section 3.2.

 

“Surety Bond”:  If so specified in the Series Supplement, with respect to any Series (or Class within such Series) of Certificates, the surety bond providing for the distribution under certain circumstances specified in such Series Supplement of amounts to the Certificateholders of such Series (or Class), which surety bond will be issued to the Trustee for the benefit of such Certificateholders by the related Credit Support Provider, all as specified in such Series Supplement.

 

“TIA”:  The Trust Indenture Act of 1939, as amended.

 

 

  

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“Trust”:  With respect to any Series, the trust created hereby and by the related Series Supplement and administered hereunder and thereunder, the assets of which consist of the Underlying Securities and the Credit Support, if applicable, and all sums distributed in respect thereof that are specified as held by the Trust for such Series in the related Series Supplement, all for the benefit of the Certificateholders of such Series as of any particular time.

 

“Trustee”:  As defined in the Series Supplement.

 

“Trustor”:  Structured Products Corp., a Delaware corporation, in its capacity as trustor under the applicable Series Supplement, and, if a successor Person shall have become the Trustor pursuant to any applicable provisions of this Agreement, “Trustor” shall mean such successor Person.  With respect to any Series Supplement that identifies a “Trustor” instead of a “Depositor,” references to “Depositor” herein shall be deemed to be references to “Trustor.”

 

“Trust Termination Event”:  With respect to any Series, as specified in the related Series Supplement.

 

“Underlying Security Provider”:  With respect to any Underlying Security purchased pursuant to a Underlying Security Purchase Agreement, each entity specified as such in the applicable Series Supplement or its successor in interest.

 

“Underlying Security Purchase Agreement”:  With respect to certain Series of Certificates, as designated in the applicable Series Supplement, the purchase agreement providing for the purchase by the Depositor of one or more Underlying Securities for such Series, substantially in the form acceptable to the Depositor.

 

“Underlying Securities”:  With respect to any Series, the asset or assets sold to the Trust for such Series or acquired (or, in the case of an agreement, entered into) by the Trustee on behalf of the Trust for the benefit of the Holders of such Series and, if and to the extent provided in the applicable Series Supplement, for the benefit of any Credit Support Provider, all as identified in the Underlying Securities Schedule to the related Series Supplement.  The Underlying Securities for any such Series or the related Trust shall not constitute Underlying Securities for any other Series or any other Trust.

 

“Underlying Securities Issuer”:  As defined in the related Series Supplement.

 

“Underlying Securities Schedule”:  With respect to any Series, a listing of the Underlying Securities for such Series as of the Closing Date, including, with respect to each Underlying Security, the obligor and the principal balance thereof, which shall be attached to such Series Supplement as Schedule A.

 

“Underwriter”:  Any bank or other financial institution which enters into an underwriting agreement with the Trustor pursuant to which such institution agrees to buy Certificates of a Series for the purpose of resale to investors.

 

“Uniform Commercial Code”:  The Uniform Commercial Code as in effect in the relevant jurisdiction.

 

“United States”:  The United States of America (including the States), its territories, its possessions and other areas subject to its jurisdiction.

 

“Voting Rights”:  With respect to any Series (or Class within such Series) of Certificates, the portion of the aggregate voting rights of the Certificates of such Series or Class which shall be allocated to any Certificate as specified in the applicable Series Supplement.

 

  

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Section 1.2   Rules of Construction.  Unless the context otherwise requires:

 

	 	 (i)	a term has the meaning assigned to it;
	 	 	 
	 	 (ii)	an accounting term not otherwise defined has the meaning assigned to it in accordance with generally accepted accounting principles as in effect in the United States from time to time;
	 	 	 
	 	 (iii)	“or” is not exclusive;
	 	 	 
	 	 (iv)	the words “herein,” “hereof,” “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section or other subdivision;
	 	 	 
	 	 (v)	“including” means including without limitation;
	 	 	 
	 	 (vi)	words in the singular include the plural and words in the plural include the singular; and
	 	 	 
	 	 (vii)	any reference herein to a “beneficial interest” in a security also shall mean a security entitlement with respect to such security, and any reference herein to a “beneficial owner” or “beneficial holder” of a security also shall mean the holder of a security entitlement with respect to such security
	      .

 

ARTICLE II 

                     

DECLARATION OF TRUSTS; ISSUANCE OF CERTIFICATES

 

Section 2.1  Creation and Declaration of Trusts; Assignment of Underlying Securities.  (a) The Depositor, concurrently with the execution and delivery of the applicable Series Supplement, does hereby agree to (i) sell, assign, transfer, set-over and otherwise convey to the Trust, on behalf and for the benefit of the Certificateholders of the related Series of Certificates, without recourse, all the right, title and interest of the Depositor, in, to and under the Underlying Securities attributable to such Series (except for the Underlying Securities attributable to such Series which are not sold by the Depositor, as specified in the Underlying Securities Schedule to the applicable Series Supplement), in each case as identified on the applicable Underlying Securities Schedule, and all other assets to be transferred to the respective Trust for the benefit of the Certificateholders of each such Series (including but not limited to any Credit Support Instrument) or (ii) deliver to the Trustee for credit to the Certificate Account an amount, in immediately available funds in a form acceptable to the Trustee, sufficient to acquire the Underlying Securities on behalf of the Trust attributable to such Series, in each case as identified on the Underlying Security Schedule to the applicable Series Supplement, and all other assets to be transferred to the respective Trust for the benefit of the Certificateholders of each such Series.  To the extent the Depositor causes Underlying Securities to be acquired by the Trustee pursuant to clause (ii) above, the Depositor will be identified as the Trustor in the related Series Supplement.  Each such sale will include all interest, premium (if any) and principal received by or on behalf of the Depositor of, on or with respect to any such Underlying Securities due after the applicable Cut-off Date, and, unless otherwise specified in the Series Supplement, will exclude (x) all interest, premium (if any) and principal of, on or with respect to any such Underlying Securities due on or before the applicable Cut-off Date and (y) any Retained Interest in any such Underlying Security.

 

(b)       In connection with each sale referred to in the preceding paragraph, the Depositor shall, not later than the applicable Closing Date, (i) deposit the Underlying Securities for a given Series (except for the Underlying Securities attributable to such Series which are to be acquired from a Person other than the Depositor, as specified on the Underlying Securities Schedule to the applicable Series Supplement) with the Trustee on behalf of the Trust by physical delivery of such Underlying Securities, duly endorsed, to the Trustee or by causing such Underlying Securities to be registered by book entry in the name of the Trust, (ii) with respect to each such Underlying Security, deliver or cause to be delivered to the Trustee all documents necessary to transfer ownership of each such Underlying Security to the Trust and (iii) assign all of its rights and privileges under each of the Underlying Security Purchase Agreements relating to the Underlying Securities sold to the Trust.

 

(c)       Unless otherwise specified in the applicable Series Supplement, the sale of such Underlying Securities by the Depositor for a given Series accomplished hereby and by such Series Supplement is absolute and is intended by the parties hereto as a sale and not a loan.  The Depositor represents and covenants that the Underlying Securities as of the related Closing Date will be free and clear of any right, charge, security interest or lien or claim in favor of the Depositor and, with respect to any sale of Underlying Securities, that the Depositor will as of such related Closing Date have the right to sell the applicable Underlying Securities to the Trust.

 

Section 2.2   Acceptance by Trustee.  With respect to each Series, the Trustee will acknowledge receipt by it, or by a custodian on its behalf, of the related Underlying Securities and the related documents referred to in Section 2.1, now existing or hereafter acquired, and declares that it will hold such Underlying Securities and documents and all other documents delivered to it pursuant to this Agreement, and that it will hold all such assets and such other assets (including Underlying Securities acquired from a Person other than the Depositor) intended to be transferred to the Trust for a given Series of Certificates, in trust for the exclusive use and benefit of all present and future Certificateholders of such Series and for the purposes and subject to the terms and conditions set forth in this Agreement.

 

Section 2.3   Reserved.

 

 

  

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Section 2.4   Representations and Warranties of the Depositor and Representations, Warranties and Covenants of the Administrative Agent.  (a)  The Depositor hereby represents and warrants to the Trustee that as of the Closing Date or as of such other date specifically provided herein or in the applicable Series Supplement:

 

(i)   the Depositor is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware;

 

(ii)   with respect to the related Series Supplement, to the Depositor’s knowledge, the information set forth in the related Underlying Security Schedule with respect to each Underlying Security is true and correct in all material respects at the date or dates respecting which such information is furnished;

 

(iii)   the execution and delivery of this Agreement by the Depositor and its performance of and compliance with the terms of this Agreement will not violate the Depositor’s articles of incorporation or by-laws or constitute a default (or an event which, with notice or lapse of time, or both, would constitute a default) under, or result in the breach or acceleration of, any material contract, agreement or other instrument to which the Depositor is a party or which may be applicable to the Depositor or any of its assets;

 

(iv)   the Depositor has the full power and authority to enter into and consummate all transactions contemplated by this Agreement, has duly authorized the execution, delivery and performance of this Agreement and has duly executed and delivered this Agreement. This Agreement, upon its execution and delivery by the Depositor and assuming due authorization, execution and delivery by the Trustee, will constitute a valid, legal and binding obligation of the Depositor, enforceable against it in accordance with the terms hereof, except as such enforcement may be limited by bankruptcy, insolvency, reorganization, receivership, moratorium or other laws relating to or affecting the rights of creditors generally, and by general equity principles (regardless of whether such enforcement is considered a proceeding in equity or at law);

 

(v)   the Depositor is not in violation, and the execution and delivery of this Agreement by the Depositor and its performance and compliance with the terms of this Agreement will not constitute a violation, of any order or decree of any court or any order or regulation of any Federal, State, municipal or governmental agency having jurisdiction over the Depositor or its properties, which violation would reasonably be expected to have a material and adverse effect on the condition (financial or otherwise) or operations of the Depositor or its properties or on the performance of its duties hereunder; and

 

(vi)   any additional representations and warranties, if any, that may be specified in the applicable Series Supplement.

 

It is understood and agreed that the representations and warranties of the Depositor set forth in this Section 2.4(a) shall survive delivery of the respective documents to the Trustee and shall inure to the benefit of the Trustee on behalf of the Certificateholders notwithstanding any restrictive or qualified endorsement or assignment.  Upon discovery by any of the Depositor, the Administrative Agent, if any, or the Trustee of a breach of any of the foregoing representations and warranties which materially and adversely affects the interests of the Certificateholders, the party discovering such breach shall give prompt written notice thereof to the other parties.

 

 

  

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(b)       The Administrative Agent, if any, shall make such representations, warranties, if any, and covenants that may be specified in the applicable Series Supplement.

 

Upon discovery by any of the Depositor, the Administrative Agent, if any, or the Trustee of a breach of any of the foregoing representations, warranties and covenants which materially and adversely affects the interests of the Certificateholders, the party discovering such breach shall give prompt written notice thereof to the other parties.

 

Section 2.5   Breach of Representation, Warranty or Covenant.  (a)  Within 90 days of the earlier of discovery by the Depositor or receipt of notice by the Depositor of a breach of any representation or warranty of the Depositor set forth in Section 2.4(a) that materially and adversely affects the interests of the Certificateholders of a given Series of Certificates, the Depositor shall cure such breach in all material respects.

 

(b)       With respect to an Administrative Agent appointed pursuant to the applicable Series Supplement, within 90 days of the earlier of discovery by such Administrative Agent or receipt of notice by such Administrative Agent of a breach of any representation, warranty or covenant of such Administrative Agent set forth in the applicable Series Supplement that materially and adversely affects the interests of the Certificateholders, such Administrative Agent shall cure such breach in all material respects.

 

Section 2.6   Agreement to Authenticate and Deliver Certificates.  With respect to each Series of Certificates and the related Trust, the Trustee hereby agrees and acknowledges that it will, concurrently with the transfer of and receipt by it of the related Underlying Securities and delivery to it by the Depositor of forms of Certificates of such Series, cause to be executed, authenticated and delivered to or upon the order of the Depositor, in exchange for the Underlying Securities and such other assets to be transferred to the Trust for a given Series, Certificates duly executed and authenticated by or on behalf of the Trustee in authorized denominations evidencing ownership of the entire Trust for such Series, all in accordance with the terms and subject to the conditions of Sections 5.2 and 5.13.

 

Section 2.7   Statement of Intent.  It is the intention of the parties hereto that, for purposes of federal income taxes, state and local income and franchise taxes and any other taxes imposed upon, measured by or based upon gross or net income, the Trust shall be treated as a grantor trust, but failing that, as a partnership.  The terms of this Agreement shall be interpreted to further this intention of the parties.  The parties hereto agree that, unless otherwise required by a change in law occurring after the date hereof, a closing agreement with an applicable tax authority or a final non-appealable judgment of a court of competent jurisdiction, the Trust shall file or cause to be filed annual or other necessary returns, reports and other forms consistent with such intended characterization.  Each Certificateholder and each beneficial owner of a Certificate by acceptance of its Certificate (or its beneficial interest therein) agrees, unless otherwise required by a change in law occurring after the date hereof, a closing agreement with an applicable tax authority or a final non-appealable judgment of a court of competent jurisdiction, to file its own tax returns and reports in a manner consistent with such characterization.

 

 

  

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Section 2.8   Acknowledgment Concerning the Underwriter.  The Trustor may in connection with any Series enter into an underwriting agreement with an Underwriter or Underwriters and with respect to any such Underwriter each Certificateholder of such Series by the acceptance of a Certificate shall be deemed to have acknowledged and agreed that any and all such Underwriters may (1) engage in any kind of business with or have an investment in the Underlying Issuer or affiliates of the Underlying Issuer and (2) obtain or be in possession of non-public information regarding the Underlying Securities which such Underwriter does not make available to the Certificateholders or potential Certificateholders and the Underwriters shall have no obligation or duty to provide such information to the Certificateholders or potential Certificateholders.

 

ARTICLE III   

 

ADMINISTRATION OF EACH TRUST

 

Section 3.1   Administration of Each Trust.  (a)  The Trustee (and, to the extent required in the applicable Series Supplement, any Administrative Agent) shall administer the Underlying Securities owned by each given Trust for the benefit of the Certificateholders of the related Series.  In engaging in such activities, the Trustee (or the Administrative Agent, if applicable) shall, subject to the provisions of Article VI hereof, follow or cause to be followed collection procedures in accordance with the terms of this Agreement and the applicable Series Supplement, the respective Underlying Securities and any applicable Credit Support Instruments.  With respect to each Trust, and subject only to the above-described standards and the terms of this Agreement, the related Series Supplement and the respective Underlying Securities and applicable Credit Support Instruments, if any, the Trustee (or the Administrative Agent, if applicable) shall have full power and authority, acting alone or through Sub-Administrative Agents as provided in Section 3.2, to do or cause to be done any and all things in connection with such administration which it deems necessary to comply with the terms of this Agreement and the applicable Series Supplement.

 

(b)        Without limiting the generality of the terms of paragraph (a) of this Section 3.1, with respect to any Series of Certificates, the Administrative Agent, if any, specified in the applicable Series Supplement shall be hereby authorized and empowered by the Depositor, when such Administrative Agent believes it appropriate in its reasonable judgment and when otherwise required by a Series Supplement, in its own name or in the name of a Sub-Administrative Agent, (i) to instruct the Trustee in writing to make distributions or payments from the Certificate Account or any other Account for such Series, as set forth herein or in the related Series Supplement, and (ii) to the extent specified in the related Series Supplement, to execute and deliver, on behalf of the Certificateholders of such Series and the Trustee or any of them, and upon notice to the Trustee, any and all instruments of satisfaction or cancellation, or of partial or full release or discharge, and all other comparable instruments, with respect to any of the Underlying Securities relating to such Series.

 

(c)       The duties of the Trustee and the Administrative Agent, if any, shall be performed in accordance with applicable local, State and Federal law, and the Trustee (or, if specified in the applicable Series Supplement, the Administrative Agent) shall make any and all filings, reports, notices or applications with, and seek any comments and authorizations from, the Commission and any State securities authority on behalf of the Trust for each Series.  If the applicable Series Supplement appoints an Administrative Agent, the Trustee, in its capacity as Trustee, shall execute, at the written direction of such Administrative Agent, any powers of attorney and other documents necessary or appropriate to enable the Administrative Agent to carry out any of its administrative duties hereunder; provided, however, that the Trustee, in its capacity as Trustee, shall not be accountable for the actions of the Administrative Agent or any Sub-Administrative Agents under such powers of attorney.

 

 

  

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Section 3.2   Sub-Administration Agreements Between Administrative Agent or Trustee and Sub-Administrative Agents.

 

(a)      Unless otherwise provided in a Series Supplement, an Administrative Agent specified in the applicable Series Supplement and the Trustee may enter into Sub-Administration Agreements with one or more Sub-Administrative Agents in order to delegate their administrative obligations with respect to a related Series under this Agreement to such Sub-Administrative Agents; provided, however, that (i) such delegation shall not release either such Administrative Agent or the Trustee, as applicable, from the duties, obligations, responsibilities or liabilities arising under this Agreement; (ii) the Rating Agency Condition shall have been satisfied with respect to the entering into of any such agreement and (iii) such agreements are consistent with the terms of this Agreement and, with respect to Certificates of any Series, the related Series Supplement.  With respect to any Series (or Class within such Series) of Certificates, each Sub-Administration Agreement shall impose on the Sub-Administrative Agent requirements conforming to the provisions set forth in Section 3.1 and provide for administration of the related Trust and all or certain specified Underlying Securities for such Series consistent with the terms of this Agreement. Additional requirements relating to the scope and contents of any Sub-Administration Agreement may be provided in the applicable Series Supplement.  Such Administrative Agent shall deliver to the Trustee and the Depositor copies of all Sub-Administration Agreements which it enters into, and any amendments or modifications thereof, promptly upon the Administrative Agent’s execution and delivery of any such instruments.

 

(b)       As part of its duties hereunder, an Administrative Agent specified in the applicable Series Supplement shall enforce the obligations of each Sub-Administrative Agent under any related Sub-Administration Agreement which it enters into and of the Underlying Security Provider, if any, under any Underlying Security Purchase Agreement, for the benefit of the Trustee and the Certificateholders of a given Series.  Such enforcement, including the legal prosecution of claims, the termination of Sub-Administration Agreements or Underlying Security Purchase Agreements, as appropriate, and the institution of Proceedings and the pursuit of other appropriate remedies, shall be in such form and carried out to such an extent and at such time as the Administrative Agent, in its good faith business judgment, deems necessary or advisable, subject in all cases to the provisions of Article VI hereof.

 

 

  

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Section 3.3   Successor Sub-Administrative Agents.  An Administrative Agent specified in the applicable Series Supplement and the Trustee shall each be entitled to terminate any Sub-Administration Agreement which it enters into and the rights and obligations of any Sub-Administrative Agent under any Sub-Administration Agreement in accordance with the terms and conditions of any such Sub-Administration Agreement.  In the event of a termination of any Sub-Administration Agreement, the Administrative Agent or the Trustee, as applicable, shall simultaneously reassume direct responsibility for all obligations delegated in such Sub-Administration Agreement without any act or deed on the part of the applicable Sub-Administrative Agent, the Trustee or the Administrative Agent, and the Administrative Agent or the Trustee, as applicable, either shall administer directly the related Underlying Securities or shall enter into a Sub-Administration Agreement with a successor Sub-Administrative Agent which so qualifies under Section 3.2.

 

Section 3.4   Liability of the Administrative Agent.  Notwithstanding any Sub-Administration Agreement or any of the provisions of this Agreement relating to agreements or arrangements between an Administrative Agent, if any, or the Trustee and a Sub-Administrative Agent or references to actions taken through a Sub-Administrative Agent or otherwise, the Administrative Agent, if any is specified in the applicable Series Supplement (but subject to the limitations on liability set forth in Sections 6.3 and 8.2, as applicable), or the Trustee, as applicable, shall remain obligated and primarily liable to the Trustee and the Certificateholders for the administering of the Trust and the Underlying Securities for each related Series of Certificates to the extent provided herein and in the related Series Supplement in accordance with the provisions of Section 3.1 without diminution of such obligation or liability by virtue of any such Sub-Administration Agreements or arrangements or by virtue of indemnification from the Sub-Administrative Agent and to the same extent and under the same terms and conditions as if the Administrative Agent or the Trustee, as applicable, alone were administering the Underlying Securities, and the Administrative Agent or the Trustee, as applicable, shall not thereby be released from any duties or responsibilities set forth in this Agreement or the related Series Supplement.  The Administrative Agent and the Trustee shall be entitled to enter into any agreement with a Sub-Administrative Agent for indemnification of the Administrative Agent or the Trustee by such Sub-Administrative Agent for any liability or obligation sustained by the Administrative Agent or the Trustee in connection with any act or failure to act by the Sub-Administrative Agent, and nothing contained in this Agreement shall be deemed to limit or modify such indemnification.

 

Section 3.5   No Contractual Relationship Between Certain Sub-Administrative Agents and Trustee or Certificateholders.  Any Sub-Administration Agreement between an Administrative Agent specified in the applicable Series Supplement and a Sub-Administrative Agent that may be entered into and any transactions or services relating to the Underlying Securities pursuant to such an agreement shall be deemed to be between the Sub-Administrative Agent and the Administrative Agent alone, and the Trustee and Certificateholders shall not be deemed parties thereto and shall have no claims, rights, obligations, duties or liabilities with respect to the Sub-Administrative Agent except as set forth in Section 3.6.  Except as set forth in Section 3.6, the Administrative Agent shall be solely liable for all fees owed by it to any Sub-Administrative Agent, irrespective of whether the Administrative Agent’s compensation pursuant to this Agreement is sufficient to pay such fees; provided, however, that if so provided in the applicable Series Supplement, a Sub-Administrative Agent shall be entitled to a Retained Interest in certain Underlying Securities as and to the extent specified in the Underlying Securities Schedule to such Series Supplement.  Each such Sub-Administrative Agent shall be reimbursed by the Administrative Agent for expenditures made by such Sub-Administrative Agent to the same extent the Administrative Agent would be reimbursed for such expenditures pursuant to the terms of this Agreement.

 

 

  

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Section 3.6   Assumption or Termination of Sub-Administration Agreements by Trustee.  Except as and to the extent otherwise provided in a Series Supplement, in the event an Administrative Agent specified in the applicable Series Supplement shall for any reason no longer be acting in such capacity with respect to any Series, the Trustee or its designee shall thereupon assume all the rights and obligations of the Administrative Agent under each Sub-Administration Agreement that the Administrative Agent may have entered into with respect to any Underlying Security or securities related to such Series, provided that the Trustee may elect to terminate any such Sub-Administration Agreement in accordance with its terms.  Except as otherwise provided in such a Series Supplement, the Trustee, its designee or any successor Administrative Agent shall be deemed to have assumed all the Administrative Agent’s interest therein and to have replaced the Administrative Agent as a party to each Sub-Administration Agreement to the same extent as if each Sub-Administration Agreement had been assigned to the assuming party; provided, however, that the Administrative Agent shall not thereby be relieved of any liability or obligations under any Sub-Administration Agreement and provided further, that the Trustee shall in no event be obligated to make any Advances if it is prohibited by law or regulation from doing so or from obligating itself to do so. The Administrative Agent at its expense shall, upon request of the Trustee, deliver to such assuming party all documents and records relating to each Sub-Administration Agreement and the Underlying Securities then being administered by it and an accounting of amounts collected and held by it and otherwise use its best efforts to effect the orderly and efficient transfer of the Sub-Administration Agreements to the assuming party.

 

Section 3.7   Collection of Certain Underlying Security Payments.  With respect to any Series or Class of Certificates, the Trustee (or the Administrative Agent if specified in the related Series Supplement) shall make reasonable efforts to collect all payments required to be made pursuant to the terms of the Underlying Securities or any related Credit Support Instruments in a manner consistent with the terms of this Agreement, such Underlying Securities and any related Credit Support Instruments.

 

Section 3.8   Collections by Sub-Administrative Agent.  Unless otherwise provided in the applicable Series Supplement, in the event a Sub-Administrative Agent is administering one or more Underlying Securities pursuant to a Sub-Administration Agreement, the Sub Administrative Agent shall be required to immediately direct the Trustee in writing to deposit into an Eligible Account established by such Sub-Administrative Agent (a “Sub-Administration Account”) any amounts collected with respect thereto, and not later than the Business Day after receipt thereof, all such amounts shall be deposited into the related Certificate Account.

 

Section 3.9   Certificate Account.  (a)  For each Series of Certificates, the Trustee shall establish and maintain one or more Eligible Accounts (collectively, the “Certificate Account”), held in trust for the benefit of the Certificateholders of such Series.  The Trustee on behalf of such Certificateholders shall possess all right, title and interest in all funds credited from time to time to each Certificate Account and in all proceeds thereof.  With respect to each Series of Certificates, the Certificate Account shall be under the sole dominion and control of the Trustee for the benefit of the related Certificateholders.  With respect to each Series of Certificates, the Trustee shall credit or the Administrative Agent, if any, specified in the applicable Series Supplement shall direct the Trustee in writing to credit or cause to be credited to the Certificate Account no later than the Business Day after receipt thereof all amounts collected with respect to the Underlying Securities, any Credit Support and all Liquidation Proceeds related to such Series including:

 

 

  

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	 	 (i)	 all payments on account of principal of such Underlying Securities;
	 	 	 
	 	 (ii)	 all payments on account of interest on such Underlying Securities;
	 	 	 
	 	 (iii)	 all payments on account of premium (if any) on such Underlying Securities;
	 	 	 
	 	 (iv)	 any payments in respect of any such Credit Support;
	 	 	 
	 	 (v)	 any Advances made as required pursuant to Section 4.3; and
	 	 	 
	 	 (vi)	 any interest or investment income earned on funds in the related Accounts.

 

Unless otherwise specified in the applicable Series Supplement, it is understood and agreed that payments in the nature of prepayment or redemption penalties, late payment charges or assumption fees which may be received by the Trustee or any Administrative Agent shall be credited by the Trustee or the Administrative Agent, as applicable, to the Certificate Account and shall not be retained by the Trustee or the Administrative Agent for its own account.

 

If, at any time, the Certificate Account for any Series ceases to be an Eligible Account, the Trustee shall within 10 Business Days (or such longer period, not to exceed 30 calendar days, as to which the Rating Agency Condition is met) establish a new Certificate Account meeting the conditions specified above and transfer any cash and any investments in the Certificate Account to such new Certificate Account, and from the date such new Certificate Account is established, it shall be the Certificate Account for such Series.

 

(b)     The Trustee shall give notice to the Administrative Agent, if any, the Depositor and the Rating Agency of the location of each Eligible Account constituting the Certificate Account and prior to any change thereof.

 

(c)      The Administrative Agent, if any, shall instruct the Trustee as to, or otherwise the Trustee shall determine, the appropriate application of Available Funds with respect to any Distribution Date for which application is to be made on any such Distribution Date in accordance with the terms of Section 4.1 and the related Series Supplement.

 

 

 

  

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Section 3.10   Investment of Funds in the Accounts.  The Depositor (or, if so specified in the applicable Series Supplement, the Administrative Agent), may direct the Trustee in writing to direct any depository institution maintaining the Certificate Account or the Reserve Account, if any, for the applicable Series and any other segregated Eligible Account (each, a “Depository Institution”) the contents of which are held for the benefit of Certificateholders of such Series (each, an “Account”) to invest the funds therein in one or more Permitted Investments bearing interest or sold at a discount, which shall be held to maturity unless payable on demand and which funds shall not be reinvested upon the maturity or demand for payment of such Permitted Investment.  If the Depositor (or the Administrative Agent, if applicable) does not provide any investment directions to the Trustee, funds held in any Account will be invested in the Permitted Investments.  Investments of such funds shall be invested in Permitted Investments that will mature so that such funds will be available for distribution on the Distribution Date on which such amounts are to be applied as distributions to Certificateholders.  In the event amounts in an Account are at any time invested in a Permitted Investment payable on demand, the Trustee shall:

 

(x) consistent with any notice required to be given thereunder, demand that payment thereon be made on the last day such Permitted Investment may otherwise mature hereunder in an amount equal to the lesser of (1) all amounts then payable thereunder and (2) the amount required to be withdrawn on such date; and

 

(y) in consultation with the Depositor, demand same day payment of all amounts due thereunder upon a determination by the Trustee that such Permitted Investment would not constitute a Permitted Investment in respect of funds thereafter held in any Account.

 

It is the intent of the Trustee, any Administrative Agent, and the Depositor that each Account shall be a securities account of the Trustee and not an account of the Depositor or the Administrative Agent.  Each Permitted Investment that constitutes investment property shall be held by the Trustee through a securities intermediary, which securities intermediary shall agree with the Trustee that (A) such investment property at all times shall be credited to a securities account of the Trustee, (B) all property credited to such securities account shall be treated as a financial asset, (C) such securities intermediary shall treat the Trustee as entitled to exercise the rights that comprise each financial asset credited to such securities account, (D) such securities intermediary shall comply with entitlement orders originated by the Trustee without the further consent of any other person or entity, (E) such securities intermediary shall not agree with any person or entity other than the Trustee to comply with entitlement orders originated by any person or entity other than the Trustee, (F) such securities account and all property credited thereto shall not be subject to any lien, security interest, right of set-off, or encumbrance in favor of such securities intermediary or anyone claiming through such securities intermediary (other than the Trustee), (G) the “securities intermediary’s justification” of such securities intermediary for the purposes of Article 8 of the New York Uniform Commercial Code shall be the State of New York, and (H) such agreement between such securities intermediary and the Trustee shall be governed by the laws of the State of New York.  Each Permitted Investment that does not constitute investment property shall be held by the Trustee or the Depository Institution in the State of New York.  Each term used in the preceding two sentences and defined in the New York Uniform Commercial Code shall have the meaning set forth in the New York Uniform Commercial Code.

 

 

  

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Section 3.11   Maintenance of Credit Support.  On the applicable Closing Date, the Trustee or, if so specified in the applicable Series Supplement, the Depositor or the Administrative Agent, shall, to the extent specified in the applicable Series Supplement, establish and maintain, or enter into, as applicable, in the name of the related Trust, either an asset of the related Trust or outside it, for the benefit of the Certificateholders of the related Series, the Credit Support specified in the applicable Series Supplement.  To the extent specified in the applicable Series Supplement, the Depositor or the Administrative Agent, as the case may be, will make or cause to be made any initial credit to the Certificate Account or any Reserve Account for the related Series as of the Closing Date.  Unless the Series Supplement for a given Series provides otherwise, if a Reserve Account exists for such Series, collections with respect to the Underlying Securities for such Series not distributed to the Certificateholders of such Series shall be credited to the Reserve Account.  The Reserve Account, if any, will not be an asset of or otherwise includible in the Trust but will be held for the benefit of the Credit Support Provider.

 

Amounts in the Reserve Account and amounts available pursuant to any other Credit Support for such Series shall be applied by the Trustee to make distributions of principal of and premium (if any) and interest on the Certificates of such Series as required pursuant to Section 4.1 and the applicable Series Supplement to the extent that funds are not otherwise available for such purpose.  If specified in such Series Supplement, immediately after each Distribution Date, amounts in the Reserve Account for such Series in excess of a specified amount shall be paid to the Person so specified in such Series Supplement.

 

Section 3.12   Realization Upon Defaulted Underlying Securities.  (a)  If:

 

(i)   default is made in the payment of any installment of interest on any Underlying Security when the same becomes due and payable, and such default continues unremedied for the period specified in the indenture or other authorizing document for such Underlying Security (or, if no such period is specified, five days) after receipt by the Underlying Securities Issuer of notice thereof from the Trustee or receipt by the Underlying Securities Issuer and the Trustee of notice thereof from the Holders of Outstanding Certificates representing at least 25% of the Voting Rights; or

 

(ii)   default is made in the payment of the principal of or any installment of the principal of any Underlying Security when the same becomes due and payable, and such default continues unremedied for the period specified in the indenture or other authorizing document for such Underlying Security (or, if no such period is specified, thirty (30) days) after receipt by the Underlying Securities Issuer of notice thereof from the Trustee or receipt by the Underlying Securities Issuer and the Trustee of notice thereof from the Holders of Outstanding Certificates representing at least 25% of the Voting Rights;

 

and the Underlying Securities Issuer shall, upon demand of the Trustee, fail to pay forthwith to the Trustee, for the benefit of the Holders, the whole amount then due and payable on such Underlying Securities for principal and interest, with interest upon the overdue principal, at the rate borne by the Underlying Securities and in addition thereto such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee and its agents and counsel, to the extent permitted by law (such event, an “Issuer Payment Default”), then the Trustee, in its own name and as trustee of an express trust, subject to provision being made for indemnification against costs, expenses and liabilities in a form satisfactory to the Trustee, shall institute a Proceeding for the collection of the sums so due and unpaid, and shall prosecute such Proceeding to judgment or final decree or settlement, and shall enforce the same against the Underlying Securities Issuer or other obligor upon the Underlying Securities and collect in the manner provided by law out of the property of the Underlying Securities Issuer or other obligor upon the Underlying Securities wherever situated, the moneys adjudged or decreed to be payable, unless otherwise directed by Holders of the Required Percentage -- Direction of the Trustee.  In connection therewith, the Trustee shall use its best reasonable efforts in accordance with such normal and customary procedures it shall deem necessary or advisable, and shall have the power and authority, acting alone, to do any and all things in connection therewith and the administration of the Trust as it may deem necessary or advisable.

 

 

  

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(b)       In the event that the Trustee receives money or other property in respect of the Underlying Securities (other than a scheduled interest or principal payment or the payment of any redemption premium on or with respect to the earlier redemption of the Underlying Securities) as a result of a payment default on the Underlying Securities or actual notice that such moneys or other property will be paid to the Trustee, the Trustee shall promptly give notice (as provided in Section 10.5 hereof) to the Depositary or, if the Certificates are not then held by the Depositary, directly to the Holders of the Certificates then outstanding and unpaid.  Such notice shall state that, not later than thirty (30) days after the receipt of such moneys or other property, the Trustee shall allocate and distribute such moneys or other property to the Holders of the Outstanding Certificates then unpaid, in proportion to the Certificate Principal Balance or Accreted Amount, as applicable, of each class of Outstanding Certificates, together with accrued interest to the date of distribution, if applicable, and within each class pro rata by Certificate Principal Balance.  Property received, other than cash, shall be liquidated by the Trustee in a commercially reasonable manner and the proceeds thereof, after deduction of all reasonable costs of such liquidation, distributed in cash, only to the extent necessary to avoid distribution of fractional securities.

 

(c)       The Trustee (or, if and under the circumstances specified in the applicable Series Supplement, the Administrative Agent), on behalf of the Certificateholders, shall assert claims under each applicable Credit Support Instrument, and shall take such reasonable steps, in addition to those described in Section 3.12(a), as are necessary to receive payment or to permit recovery thereunder with respect to any defaulted Underlying Securities, subject in all cases to the provisions of Article VI hereof in the case of the Administrative Agent and Article VIII hereof in the case of the Trustee.

 

(d)       Unless otherwise provided in a Series Supplement, if the Administrative Agent or the Trustee, as applicable, is unable to obtain full recovery in respect of a defaulted Underlying Security and any related Credit Support Instrument pursuant to Section 3.12(c), the Administrative Agent or the Trustee, as applicable, shall follow or cause to be followed such normal practices and procedures as it deems necessary or advisable to realize upon such defaulted Underlying Security and such Credit Support Instrument, subject in all cases to the provisions of Article VI hereof in the case of the Administrative Agent and Article VIII hereof in the case of the Trustee.

 

 

  

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Section 3.13   Retained Interest.  The Retained Interest, if any, in any Underlying Security shall initially be held by the Person so specified in the related Series Supplement as and to the extent specified in Schedule A thereof.  With respect to each Underlying Security, the Retained Interest shall be deducted by the Trustee, at the written direction of the Administrative Agent, if any, or the Depositor from applicable collections in respect of such Underlying Security.  Unless otherwise provided in the applicable Series Supplement, collections in respect of Retained Interest shall not be credited to the Certificate Account for the applicable Series and shall not constitute an asset of the Trust for such Series, but shall instead be distributed to the holder of such Retained Interest, provided that the Series Supplement for any Series with respect to which there is a Retained Interest may provide that, notwithstanding the terms contained herein, commingled amounts received in respect of assets inclusive of Underlying Securities and Retained Interest may initially be credited to a separate and discrete Eligible Account established by the Trustee at the written direction of the Administrative Agent, if any, or the Depositor and such Series Supplement may provide for additional terms relating thereto.  Unless otherwise provided in the applicable Series Supplement, after deduction of all applicable fees as provided for in this Agreement, on each Distribution Date the Trustee shall allocate on a pari passu basis any partial recovery on a Underlying Security between (a) the Retained Interest, if any, and (b) distributions to Certificateholders of the applicable Series.

 

Section 3.14   Administrative Agent’s Compensation and Reimbursement.  (a) As compensation for its activities, the Administrative Agent, if any, specified in the applicable Series Supplement shall be entitled to the Administrative Fee, which shall be paid on the dates, in the amounts, under the circumstances and in the manner specified in the applicable Series Supplement.

 

(b)        Only to the extent, provided in a Series Supplement, the Administrative Agent, if any, shall be required to pay from its compensation hereunder or otherwise all expenses incurred in connection with the Trust for the related Series and its administration of the Underlying Securities for the related Series, including payment of the fees and disbursements of the Trustee (including the reasonable fees and expenses of its counsel and independent accountants allocable to such Series), payment of expenses incurred in connection with distributions and reports to Certificateholders of such Series, payment of premiums on Credit Support Instruments related to such Series and other expenses specified in such Series Supplement; provided, however, that neither the Administrative Agent, if any, nor the Trustee will be responsible for any Federal, State, local or foreign income and franchise taxes, if any, and any interest or penalties with respect thereto, assessed on the Trust for such Series.

 

Section 3.15   Statement as to Compliance.  An Administrative Agent appointed pursuant to the applicable Series Supplement, if any, will deliver to the Trustee, the Depositor and the Rating Agency not later than 90 days following the end of each fiscal year of the Administrative Agent an Officer’s Certificate executed by two of its Executive Officers stating, as to each signatory thereof, that (i) a review of the activities of the Administrative Agent during the preceding year and of performance under this Agreement has been made under such officer’s supervision and (ii) to the best of such officer’s knowledge, based on such review, the Administrative Agent has fulfilled all its obligations under this Agreement throughout such year, or, if there has been a default in the fulfillment of any such obligation, specifying each such default known to such officer and the nature and status thereof.  Copies of such statement received by the Trustee shall be provided by the Trustee to any Certificateholder upon request at the Certificateholder’s expense.

 

 

  

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Section 3.16   [Intentionally Omitted].

 

Section 3.17   Access to Certain Documentation.  The Trustee and the Administrative Agent, if any, shall provide to any Federal, State or local regulatory authority that may exercise authority over any Certificateholder access to the documentation regarding the Underlying Securities required by applicable laws and regulations.  Such access shall be afforded without charge, but only upon reasonable request and during normal business hours at the offices of the Trustee and Administrative Agent, if any, designated by each of them.  In addition, access to the documentation regarding the Underlying Securities related to a given Series (or Class within such Series) will be provided to any Certificateholder of such Series (or Class) upon reasonable request during normal business hours at the offices of the Trustee and Administrative Agent designated by each of them at the expense of the Certificateholder requesting such access.

 

Section 3.18   Duties of the Administrative Agent.  Notwithstanding any other provision of this Agreement, with respect to any Series, the applicable Series Supplement may provide that any Administrative Agent appointed pursuant to such Series Supplement shall have no rights and no duties, obligations or liabilities except as provided in such Series Supplement and herein.

 

Section 3.19   Depositor to Furnish Names and Addresses of Holders to Trustee.  The Depositor shall furnish or cause to be furnished to the Trustee not more than five days before each Distribution Date, and at such other times as the Trustee may request in writing, a list, in such form as the Trustee may reasonably require, to the extent such information is in the possession or control of the Depositor or any of its paying agents, of the Holders of Certificates as of the close of business on the applicable record date of the Underlying Securities; provided, however, that so long as the Trustee maintains the Certificate Register, no such list shall be required to be furnished.

 

Section 3.20   Preservation of Information, Communications to Holders.

 

(a)        The Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of the Holders of Certificates contained in the most recent list furnished to the Trustee as provided in Section 3.19 and the names and addresses of Holders of Certificates received by the Trustee in its capacity as Certificate Registrar.  The Trustee may destroy any list furnished to it as provided in such Section 3.19 upon receipt of a new list so furnished.

 

(b)        Holders shall have the right to communicate pursuant to TIA Section 312(b) with other Holders with respect to their rights under this Agreement or under the Certificates.

 

(c)        The Depositor, the Trustee and the Certificate Registrar shall have the protection of TIA Section 312(c).

   

 

 

  

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ARTICLE IV

                           

DISTRIBUTIONS AND REPORTS TO CERTIFICATEHOLDERS

 

Section 4.1   Distributions.  On each Distribution Date for a given Series of Certificates, the Trustee shall apply funds in the Certificate Account for such Series in the manner and priority set forth in the Series Supplement for such Series.  Notwithstanding any other provisions in this Agreement, the right of the Holder of any Certificate to receive any such distributions in the manner and priority set forth in the Series Supplement for such Series and to institute suit for the enforcement of any such payment on or after the date such payment is payable, shall not be impaired without the consent of such Holder.

 

Section 4.2   Reports to Certificateholders.  Unless otherwise specified in the applicable Series Supplement, on the next Business Day following each such Distribution Date the Trustee or the Administrative Agent, if any, as specified in such Series Supplement, shall forward or cause to be forwarded to the Depositor, each Certificateholder of such Series and such other Persons as may be specified in such Series Supplement, a statement setting forth:

 

(i)   the amount of the distribution on such Distribution Date to Certificateholders of each Class of such Series allocable to principal of and premium, if any, and interest on the Certificates of each such Class; and the amount of aggregate unpaid interest accrued as of such Distribution Date;

 

(ii)   in the case of each Class of Floating Rate Certificates of such Series, the respective Floating Pass Through Rate applicable to each such Class on such Distribution Date, as calculated in accordance with the method specified in such Certificates and the related Series Supplement;

 

(iii)   the amount of compensation received by any Administrative Agent and such other customary information as the Trustee or Administrative Agent, as applicable, deems necessary or desirable, or that any such Certificateholder reasonably requests, to enable such Certificateholders to prepare their tax returns;

 

(iv)   if the Series Supplement provides for Advances, the aggregate amount of Advances, if any, included in such distribution, and the aggregate amount of unreimbursed Advances, if any, at the close of business on such Distribution Date;

 

(v)   the aggregate stated principal amount and, if applicable, notional amount of the Underlying Securities related to such Series, the current rating assigned by the Rating Agency thereon and the current interest rate or rates thereon at the close of business on such Distribution Date;

 

(vi)   the aggregate Certificate Principal Balance (or Notional Amount, if applicable) of each Class of such Series at the close of business on such Distribution Date; and

 

(vii)   as to any Series (or any Class within such Series) for which Credit Support has been obtained, the amount or notional amount of coverage of each element of Credit Support (and rating, if any, thereof) included therein as of the close of business on such Distribution Date.

 

 

  

27

  

 

 

In the case of information furnished pursuant to subclauses (i) and (iii) above, the amounts shall be expressed as a Dollar amount (or the equivalent thereof in any other Specified Currency) per minimum denomination of Certificates or for such other specified portion thereof.  Within a reasonable period of time after the end of each calendar year, the Trustee shall furnish to each person who at any time during each such calendar year was a Certificateholder a statement containing the information set forth in subclauses (i) and (iii) above, aggregated for such calendar year or the applicable portion thereof during which such person was a Certificateholder.  Such obligation of the Trustee shall be deemed to have been satisfied to the extent that substantially comparable information shall be provided by the Trustee pursuant to any requirements of the Code as are from time to time in effect.

 

Section 4.3   Advances.  (a)  Unless otherwise specified in the applicable Series Supplement, an Administrative Agent appointed pursuant to the Series Supplement shall have no obligation to make Advances (as defined below) with respect to the Underlying Securities or in favor of the Holders of any Series (or Class within such Series) of Certificates.  However, as and to the extent provided in the Series Supplement for a given Series, and subject to the terms of paragraphs (b) and (c) of this Section 4.3, on or prior to each Distribution Date, such Administrative Agent shall advance or cause to be advanced in immediately available funds to the Trustee for credit to the Certificate Account for such Series an advance (each, an “Advance”) in an amount equal, unless otherwise specified in the related Series Supplement, to the aggregate of distributions of principal, premium (if any) and interest due on the Underlying Securities for such Series (or Class) during the related Collection Period, to the extent remaining unpaid at the time of such Advance.  In satisfaction of its obligation to make such Advances, the Administrative Agent shall make such Advances from either (i) its own funds or (ii) funds with respect to the Underlying Securities for such Series or Class in the Certificate Account for such Series, if any, that do not constitute Available Funds with respect to such Distribution Date; provided, however, that, to the extent the Administrative Agent shall have made Advances from funds in the applicable Certificate Account, the Administrative Agent shall immediately credit funds equal to the aggregate amount of such Advances to such Certificate Account on any subsequent Distribution Date to the extent that amounts in such Certificate Account on such Distribution Date are less than the amount of distributions required to be made on such Distribution Date pursuant to Section 4.1 and the related Series Supplement.  The Administrative Agent may recover Advances from late collections received by the Trustee on the applicable Underlying Securities, proceeds from any applicable Credit Support, if any, and Liquidation Proceeds with respect to the Underlying Securities for such Series or Class, as specified in the related Series Supplement, as to which any such unreimbursed Advance was made.

 

(b)       Notwithstanding any provision herein to the contrary, no Advance shall be required to be made hereunder if the Administrative Agent reasonably believes that it will be unable to recover such Advance from related late collectionb, Credit Support proceeds, if any, or Liquidation Proceeds with respect to the applicable Underlying Securities. It is further understood and agreed that the Administrative Agent shall not be obligated to make any Advances in respect of reductions in the amount of collections on the Underlying Securities due to bankruptcy proceedings with respect to the Underlying Securities or the obligors thereon.

 

 

 

  

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(c)       Notwithstanding any provision herein to the contrary, unless otherwise provided in the Series Supplement for a given Series, any Advances made in respect of any Underlying Securities related to such Series (or Class within such Series) that are subsequently deemed by the Administrative Agent to be nonrecoverable from related late collections, Credit Support proceeds, if any, or Liquidation Proceeds may be reimbursed to the Administrative Agent through the application of amounts in the Certificate Account for such Series allocable to any of such Underlying Securities prior to the distributions of interest, premium (if any) and principal with respect to the Certificates of such Series or Class.

 

Section 4.4   Compliance with Withholding Requirements.  If any withholding tax is imposed on the payment (or allocations of income) to any Certificateholder, such tax shall reduce the amount otherwise distributable to such Holder.  The Trustee is hereby authorized and directed to retain from amounts otherwise distributable to any Holder sufficient funds for the payment of any tax that is legally owed by the Trust (but such authorization shall not prevent the Trustee from contesting any such tax in appropriate proceedings and withholding payment of such tax, if permitted by law, pending the outcome of such proceedings), or that the Trustee may otherwise determine it is obligated to withhold under applicable law or regulation.  The amount of any withholding tax imposed with respect to any Holder shall be treated as cash distributed to such Holder at the time it is withheld by the Trustee and remitted to the appropriate taxing authority.  If there is a possibility that withholding tax is payable with respect to a distribution, the Trustee may in its sole discretion withhold such amounts in accordance with this Section 4.4.  If any Holder wishes to apply for a refund of any such withholding tax, the Trustee shall reasonably cooperate with such Holder in making such claim so long as such Holder agrees to reimburse the Trustee for any out of pocket expenses incurred.  The Trustee shall use reasonable efforts to give notice to each Holder of any such withholding requirement at least 10 days prior to the date of the payment from which amounts are required to be withheld.

 

Section 4.5   Optional Exchange.  (a)   The terms and conditions, if any, upon which Certificates of any Series (or Class within such Series) may be exchanged for a pro rata portion of the Underlying Securities of the related Trust will be specified in the related Series Supplement; provided that any right of exchange shall be exercisable only to the extent that the Depositor provides upon the Trustee’s request an Opinion of Counsel that (i) such exchange would not be inconsistent with the Depositor’s and the Trust’s continued satisfaction of the applicable requirements for exemption under Rule 3a 7 (or other applicable rule or exemption) under the Investment Company Act of 1940, as amended, and all applicable rules, regulations and interpretations thereunder and (ii) such exchange would not cause the Trust to fail to qualify as either a grantor trust or a partnership (other than a publicly traded partnership treated as a corporation) for U.S. federal income tax purposes.  Such terms may relate to, but are not limited to, the following:

 

 

 

  

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(1)   a requirement that the exchanging Holder tender to the Trustee Certificates of each Class within such Series;

 

(2)   a minimum Certificate Principal Balance or Notional Amount, as applicable, with respect to Certificates being tendered for exchange by a single Holder;

 

(3)   a requirement that the Certificate Principal Balance or Notional Amount, as applicable, of each Certificate tendered for exchange be an integral multiple of an amount specified in such Series Supplement;

 

(4)   specified dates during which a Holder may effect such an exchange (each, an “Optional Exchange Date”);

 

(5)   limitations on the right of an exchanging Holder to receive any benefit upon exchange from any Credit Support or Underlying Securities which are not debt securities; and

 

(6)   adjustments to the value of the proceeds of any exchange based upon required prepayment of future expense allocations and if provided for in the applicable Series Supplement the establishment of a reserve for any anticipated Extraordinary Trust Expenses.

 

(b)       Unless otherwise provided in the applicable Series Supplement, no Certificate may be exchanged pursuant to the preceding paragraph unless the Trustee has received at least 30 days but not more than 45 days prior to an Optional Exchange Date in accordance with delivery instructions specified in the applicable Series Supplement (i) such Certificate with the form entitled “Option to Elect Exchange” on the reverse thereof duly completed, or (ii) a telegram, telex, facsimile transmission or letter from a member of a national securities exchange or the National Association of Securities Dealers, Inc., the Depositary (in accordance with its normal procedures) or a commercial bank or trust company in the United States setting forth the name of the Holder of such Certificate, the Certificate Principal Balance or Notional Amount of such Certificate to be exchanged and the Certificate number or a description of the tenor and the terms of such Certificate, a statement that the option to elect exchange is being exercised thereby and an assurance that the Certificate to be exchanged with the form entitled “Option to Elect Exchange” on the reverse of the Certificate duly completed will be received by such Trustee not later than five Business Days after the date of such telegram, telex, facsimile transmission or letter, and such Certificate and form duly completed must be received by such Trustee by such fifth Business Day.  Any tender of a Certificate by the Holder thereof for exchange shall be irrevocable.  Unless otherwise provided in the applicable Series Supplement, the exchange option may be exercised pursuant to this Section by the Holder of a Certificate for less than the Certificate Principal Balance or Notional Amount of such Certificate as long as the Certificate Principal Balance or Notional Amount remaining Outstanding after such exchange is an authorized denomination and all other exchange requirements set forth in the related Series Supplement are satisfied.  Upon such partial exchange, such Certificate shall be cancelled and a new Certificate or Certificates for the remaining Certificate Principal Balance or Notional Amount thereof shall be issued (which, in the case of any Certificate, shall be in the name of the Holder of such exchanged Certificate).

 

(c)       Upon the completion of any such Optional Exchange, the Trustee shall give prompt written notice thereof to the Rating Agency.

 

 

 

  

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ARTICLE V 

               

THE CERTIFICATES

 

Section 5.1   The Certificates.  The Certificates of any Series (or Class within such Series) will be issued in fully registered form as Certificates and shall be substantially in the form of the exhibits with respect thereto attached to the applicable Series Supplement.  The aggregate Certificate Principal Balance or Notional Amount of Certificates which may be authenticated and delivered under this Agreement is unlimited.

 

The Certificates may be issued in one or more Series, each of which Series may be issued in one or more Classes, with such further particular designations added or incorporated in such title for the Certificates of any particular Series or Class within such Series as the Board of Directors may determine.  Each Certificate shall bear upon its face the designation so selected for the Series and Class to which it belongs.  All Certificates of the same Series and Class shall be identical in all respects except for the denominations thereof.  All Certificates of all Classes within any one Series at any time Outstanding shall be identical except for differences among the Certificates of the different Classes within such Series specified in the applicable Series Supplement.  Except as otherwise provided in a Series Supplement, all Certificates of a particular Series (and all Classes within such Series) issued under this Agreement shall be in all respects equally and ratably entitled to the benefits hereof without preference, priority or distinction on account of the actual time or times of authentication and delivery, all in accordance with the terms and provisions of this Agreement.

 

Each Series (and all Classes within such Series) of Certificates shall be created by a Series Supplement authorized by the Board of Directors and establishing the terms and provisions of such Series.  The several Series may differ as between Series and any Class may vary as between the other Classes within any given Series in respect of any of the following matters:

 

(1)   designation of such Series and Class;

 

(2)   the dates on which or periods during which the Certificates of such Series and Class may be issued;

 

(3)   the number of Classes, the maximum Certificate Principal Balance or Notional Amount of Certificates of each Class that may be issued and any priorities or subordination among Classes of a Series with respect to distributions from the Trust;

 

(4)   for each Class of Certificates, the Pass Through Rate and, in the case of each Class of Floating Rate Certificates, the method for calculating such Pass Through Rate;

 

(5)   the terms of the Letter of Credit, if any, or of the Surety Bond, if any, or of any other Credit Support for the benefit of the Certificateholders of such Series or Class or group of Classes;

 

 

 

  

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(6)   the places, if any, in addition to or instead of the Corporate Trust Office of the Trustee (in the case of Certificates), where the principal of (and premium, if any) and interest on Certificates of such Series and Class shall be distributable;

 

(7)   the authorized denominations (if other than $100,000 and integral multiples of $1,000 in excess thereof) with respect to such Series or Class;

 

(8)   the Collection Periods, the Distribution Dates and the Scheduled Final Distribution Dates for such Series and Class;

 

(9)   the types of Underlying Securities that will be transferred to the Trust for such Series and the manner and priorities of allocating distributions with respect to collections of principal (and premium, if any) and interest payments allocable to such Underlying Securities among Holders of Certificates of different Classes (including whether the Certificates of any such Class are to be entitled to receive principal distributions with disproportionate, nominal or no interest distributions, or interest distributions with disproportionate, nominal or no principal distributions, and, in each case, the applicable terms thereof);

 

(10)   the amount, if any, to be credited on the Closing Date to the Certificate Account for such Series;

 

(11)   the manner in which the Reserve Account, if any, is to be funded, the amount, if any, to be credited thereto on the Closing Date and the Requisite Reserve Amount, if any, for such Series or Class;

 

(12)   the terms of any Guaranteed Investment Contract sold to the related Trust;

 

(13)   the provisions, if any, for the optional exchange of the Certificates of such Series by the Certificateholders of such Series and the periods within which or the dates on which, and the terms and conditions on which, such Certificates may be exchanged in whole or in part for a pro rata portion of the Underlying Securities related to such Series;

 

(14)   whether the Certificates of such Series or Class are to be issued as Discount Certificates and the amount of discount with which such Certificates may be issued;

 

(15)   whether the Certificates of such Series or Class are to be issued in whole or in part in the form of one or more Global Securities and, in such case, the Depositary for such Global Security or Securities and the terms and conditions, if any, upon which interests in such Global Security or Securities may be exchanged in whole or in part for the individual Certificates represented thereby;

 

(16)   if other than Dollars, the Currency in which Certificates of such Series or Class shall be denominated or in which distributions of the principal of (and premium, if any) and interest on such Certificates may be made and any other terms concerning such payment;

 

 

  

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(17)   if the principal of (and premium, if any) or interest on Certificates of such Series or Class are to be distributable, at the election of the Depositor or a Holder thereof, in a Currency other than that in which such Certificates are denominated or distributable without such election, the periods within which and the terms and conditions upon which such election may be made and the time and the manner of determining the exchange rate between the Currency in which such Certificates are denominated or distributable without such election and the Currency in which such Certificates are to be distributed if such election is made;

 

(18)   any additional Administrative Agent Termination Events or representations, warranties or covenants provided for with respect to Certificates of such Series;

 

(19)   provisions with respect to the terms for which the definitions set forth in Article I permit or require further specification in the related Series Supplement, including:

 

 

 

	 	 (a)	
“Accounting Date”;

	 	 (b)	
“Accreted Amount”;

	 	 (c)	
“Administrative Agent”;

	 	 (d)	
“Administrative Fee”;

	 	 (e)	
“Available Funds”;

	 	 (f)	
“Basic Documents”;

	 	 (g)	
“Calculation Agent”;

	 	 (h)	
“Call Premium Percentage”;

	 	 (i)	
“Closing Date”;

	 	 (j)	
“Collection Period”;

	 	 (k)	
“Corporate Trust Office”;

	 	 (l)	
“Credit Support”;

	 	 (m)	
Credit Support Instrument”;

	 	 (n)	
“Credit Support Provider”;

	 	 (o)	
“Cut-off Date”;

	 	 (p)	
“Depositary”;

	 	 (q)	
“Depository Agreement”;

	 	 (r)	
“Discount Certificates”;

	 	 (s)	
“Distribution Date”;

	 	 (t)	
“Event of Default”;

	 	 (u)	
“Extraordinary Trust Expense”;

	 	 (v)	
“Final Scheduled Distribution Date”;

	 	 (w)	
Fixed Pass Through Rate”;

	 	 (x)	
“Floating Pass Through Rate”;

	 	 (y)	
“Floating Rate Certificate”;

	 	 (z)	
“Global Securities”;

	 	 (aa)	
Guaranteed Investment Contract”;

	 	 (bb)	
Letter of Credit”;

	 	 (cc)	
Limited Guarantor”;

 

 

  

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	 	 (dd)	
Limited Guaranty”;

	 	 (ee)	
Notional Amount”;

	 	 (ff)	
Optional Exchange Date”;

	 	 (gg)	
Pass Through Rate”;

	 	 (hh)	
Permitted Investments”;

	 	 (ii)	
Place of Distribution”;

	 	 (jj)	
Rating Agency”;

	 	 (kk)	
“Rating Agency Condition”;

	 	 (ll)	
“Record Date”;

	 	 (mm)	
“Required Interest”;

	 	 (nn)	
“Required Premium”;

	 	 (oo)	
“Required Principal”;

	 	 (pp)	
“Required Percentage”;

	 	 (qq)	
“Required Rating”;

	 	 (rr)	
“Requisite Reserve Amount”;

	 	 (ss)	
“Retained Interest”;

	 	 (tt)	
“Scheduled Final Distribution Date”;

	 	 (uu)	
“Specified Currency”;

	 	 (vv)	
“Surety Bond”;

	 	 (ww)	
“Trust”;

	 	 (xx)	
“Trustee”;

	 	 (yy)	
“Trust Termination Event”;

	 	 (zz)	
“Underlying Security Provider”;

	 	 (aaa)	
“Underlying Security Purchase Agreement”;

	 	 (bbb)	
“Underlying Securities”;

	 	 (ccc)	
“Underlying Securities Issuer”;

	 	 (ddd)	
“Underlying Securities Schedule”;

	 	 (eee)	
“Voting Rights”;

 

 

(20)   rights and remedies provided to any Credit Support Provider with respect to all or a portion of the Trust for such Series or Class;

 

(21)   any restrictions on the sale and transfer of the Certificates, including restrictions arising out of the Employee Retirement Income Security Act of 1974, as amended, or the Code; and

 

(22)   any other provisions expressing or referring to the terms and conditions upon which the Certificates of such Series or Class are to be issued under this Agreement that do not prevent such Certificates from receiving the Required Rating.

 

In the absence of any specification pursuant to this Section 5.1 with respect to Certificates of any Series, the Certificates of such Series shall be issuable only as Certificates in denominations of $100,000 and in integral multiples thereof and shall be payable only in Dollars.

 

A different Trustee and an Administrative Agent may be appointed by the Depositor for each Series of Certificates prior to the issuance of such Series provided that the Rating Agency Condition is met.  Such Series Supplement shall provide for the appointment of the Trustee or the Administrative Agent or both, as applicable, of such Series and shall add or change any of the provisions of this Agreement as shall be necessary to provide for or facilitate the administration of the trusts hereunder and of the Underlying Securities; it being understood that nothing contained herein or in such Series Supplement shall constitute the Trustees for different Series as co-trustees for the same Series or the administrative agents for different Series as co-administrative agents for the same Series, and that each Trustee shall be a trustee of a trust or trusts separate and apart from any trust or trusts hereunder of any other Trustee, and that each Administrative Agent shall be an administrative agent of a Trust separate and apart from any other Trust.  Upon final appointment of any new Trustee or Administrative Agent, the Trustee shall provide a notice of such appointment to the Rating Agency not later than 15 days following such appointment.

 

 

  

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Section 5.2   Execution, Authentication and Delivery.  (a)  The Certificates shall be executed by the Trustee by a Responsible Officer.  The signature of any of the Responsible Officer may be manual or facsimile.  Certificates bearing the manual or facsimile signature of individuals who were at the time of execution the proper officers of the Trustee shall be binding, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Certificates or did not hold such offices at the date of such Certificates.

 

(b)        Each Certificate shall be dated as of the later of the date specified in the related Series Supplement and the date of its authentication.

 

(c)        No Certificate shall be entitled to any benefit under this Agreement or be valid or obligatory for any purpose, unless there appears on such Certificate a certificate of authentication substantially in one of the forms provided for herein executed by the Trustee by the manual signature of one of its authorized signatories, and such certificate upon any Certificate shall be conclusive evidence, and the only evidence, that such Certificate has been duly authenticated and delivered hereunder and is entitled to the benefits of this Agreement.

 

Section 5.3   Temporary Certificates.  Pending the preparation of Definitive Certificates of any Series (or Class within such Series), the Trustee may execute, and upon receipt of a Depositor Order, the Trustee shall authenticate and deliver temporary Certificates which are printed, lithographed, typewritten, mimeographed or otherwise produced, in any authorized denomination, substantially of the tenor of the Definitive Certificates in lieu of which they are issued, in registered form and with such appropriate insertions, omissions, substitutions and other variations as may be authorized by such Depositor Order.  Any such temporary Certificate may be in global form, representing all or a portion of the Outstanding Certificates of such Series or Class.  Every such temporary Certificate shall be executed by the Trustee and shall be authenticated and delivered by the Trustee upon the same conditions and in substantially the same manner, and with the same effect, as the Definitive Certificate or Definitive Certificates in lieu of which it is issued.

 

If temporary Certificates of any Series (or Class within such Series) are issued, the Depositor will cause Definitive Certificates of such Series or Class to be prepared without unreasonable delay and (a) after the preparation of Definitive Certificates of such Series or Class, the temporary Certificates of such Series or Class shall be exchangeable for Definitive Certificates of such Series or Class upon surrender of the temporary Certificates of such Series or Class at the office of the Trustee in a Place of Distribution for such Series or Class, without charge to the Holder, except as provided in Section 5.4 in connection with a transfer and (b) upon surrender for cancellation of any one or more temporary Certificates of any Series or Class within such Series the Trustee shall execute and the Trustee shall authenticate and deliver in exchange therefor Definitive Certificates with a like Certificate Principal Balance or Notional Amount, as applicable, of the same Series (or Class within such Series) of authorized denominations and of like tenor.  Until so exchanged, temporary Certificates of any Series (or Class within such Series) shall in all respects be entitled to the same benefits under this Agreement as Definitive Certificates of such Series or Class, except as otherwise specified in the applicable Series Supplement with respect to the payment of interest on Global Securities in temporary form.

 

  

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Upon any exchange of a portion of a temporary Global Security for a definitive Global Security or for the individual Definitive Certificates represented thereby pursuant to this Section 5.3 or Section 5.4, the temporary Global Security shall be endorsed by the Trustee to reflect the reduction of the aggregate Certificate Principal Balance or Notional Amount, as applicable, evidenced thereby, whereupon the aggregate Certificate Principal Balance or Notional Amount, as applicable, of such temporary Global Security shall be reduced for all purposes by the amount so exchanged and endorsed.

 

Section 5.4   Registration; Registration of Transfer and Exchange.  The Trustee shall cause to be kept a register for each Series of Certificates (the registers maintained in such office and in any other office or agency of the Trustee in a Place of Distribution being herein sometimes collectively referred to as the “Certificate Register”) in which a transfer agent and registrar (which may be the Trustee) (the “Certificate Registrar”) shall provide for the registration of Certificates and the registration of transfers and exchanges of Certificates.  The Trustee is hereby initially appointed Certificate Registrar for the purpose of registering Certificates and transfers and exchanges of Certificates as herein provided; provided, however, that the Trustee may appoint one or more co-Certificate Registrars.  Upon any resignation of any Certificate Registrar, the Trustee shall promptly appoint a successor or, in the absence of such appointment, assume the duties of Certificate Registrar.

 

If a Person other than the Trustee is appointed by the Trustee as Certificate Registrar, the Trustee will give the Depositor prompt written notice of the appointment of a Certificate Registrar and of the location, and any change in the location, of the Certificate Register, and the Trustee shall have the right to rely upon a certificate executed on behalf of the Certificate Registrar by an Executive Officer thereof as to the names and addresses of the Holders of the Certificates and the principal amounts and numbers of such Certificates.

 

Upon surrender for registration of transfer of any Certificate of any Series (or Class within such Series) at the office or agency of the Trustee, if the requirements of Article 8 of the Uniform Commercial Code are met to the Trustee’s satisfaction, the Trustee shall execute, and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Certificates of any authorized denominations, of a like Series, Class and aggregate Certificate Principal Balance or Notional Amount, as applicable.

 

 

  

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Notwithstanding any other provision of this Section, unless and until it is exchanged in whole or in part for the individual Certificates represented thereby, a Global Security representing all or a portion of the Certificates of a Series (or Class within such Series) may not be transferred except as a whole by the Depositary for such Series or Class to a nominee of such Depositary or by a nominee of such Depositary to such Depositary or another nominee of such Depositary or by such Depositary or any such nominee to a successor Depositary for such Series or Class or a nominee of such successor Depositary.

 

At the option of the Holder, Certificates of any Series (or Class within such Series) (other than a Global Security, except as set forth below) may be exchanged for other Certificates of the same Series or Class of any authorized denomination or denominations of like tenor and aggregate Certificate Principal Balance or Notional Amount, as applicable, upon surrender of the Certificates to be exchanged at the office or agency of the Trustee maintained for such purpose.

 

Whenever any Certificates are so surrendered for exchange, the Trustee shall execute and the Trustee shall authenticate and deliver the Certificates that the Holder making the exchange is entitled to receive.

 

If at any time the Depositary for the Certificates of a Series (or Class within such Series) notifies the Depositor that it is unwilling or unable to continue as Depositary for the Certificates of such Series or Class or if at any time the Depositary for the Certificates of such Series or Class shall no longer be eligible under Section 5.9(b), the Depositor shall appoint a successor Depositary with respect to the Certificates of such Series or Class.  If a successor Depositary for the Certificates of such Series or Class is not appointed by the Depositor within 90 days after the Depositor receives such notice or becomes aware of such ineligibility, the Depositor’s election pursuant to Section 5.1 shall no longer be effective with respect to the Certificates of such Series or Class and the Trustee will execute, and the Trustee, upon receipt of a Depositor Order for the authentication and delivery of individual Certificates of such Series or Class, will authenticate and deliver individual Certificates of such Series or Class in an aggregate Certificate Principal Balance or Notional Amount, as applicable, equal to the aggregate Certificate Principal Balance or Notional Amount, as applicable, of the Global Security or Securities representing Certificates of such Series or Class in exchange for such Global Security or Securities.

 

To the extent permitted by law, the Depositor may at any time and in its sole discretion determine that individual Certificates of any Series (or Class within such Series) issued in the form of one or more Global Securities shall no longer be represented by such Global Security or Securities.  In such event the Trustee shall execute, and the Trustee, upon receipt of a Depositor Order for the authentication and delivery of individual Certificates of such Series or Class, shall authenticate and deliver, individual Certificates of such Series or Class in an aggregate Certificate Principal Balance or Notional Amount, as applicable, equal to the aggregate Certificate Principal Balance or Notional Amount, as applicable, of the Global Security or Securities representing Certificates of such Series or Class in exchange for such Global Security or Securities.

 

If specified by the Depositor pursuant to Section 5.1 with respect to a Series (or Class within such Series) of Certificates, the Depositary for such Series may surrender a Global Security for such Series or Class in exchange in whole or in part for individual Certificates of such Series or Class on such terms as are acceptable to the Depositor and such Depositary.  Thereupon, the Trustee shall execute, and the Trustee, upon receipt of a Depositor Order, shall authenticate and deliver, without service charge,

 

 

  

37

  

 

(i)   to each Person specified by such Depositary a new individual Certificate or Certificates of the same Series or Class, of any authorized denomination as requested by such Person in an aggregate Certificate Principal Balance or Notional Amount, as applicable, equal to and in exchange for such Person’s beneficial interest in the Global Security; and

 

(ii)   to such Depositary a new Global Security in a denomination equal to the difference, if any, between the aggregate Certificate Principal Balance or Notional Amount, as applicable, of the surrendered Global Security and the aggregate Certificate Principal Balance or Notional Amount, as applicable, of individual Certificates delivered to Holders thereof.

 

In any exchange provided for in any of the preceding three paragraphs, the Trustee shall execute, and the Trustee, upon receipt of a Depositor Order, will authenticate and deliver individual Certificates in registered form in authorized denominations.

 

Upon the exchange of a Global Security for individual Certificates, such Global Security shall be cancelled by the Trustee.  Individual Certificates issued in exchange for a Global Security pursuant to this Section 5.4 shall be registered in such names and in such authorized denominations as the Depositary for such Global Security, pursuant to instructions from its Participants, any indirect participants or otherwise, shall instruct the Trustee.  The Trustee shall deliver such Certificates to the Persons in whose names such Certificates are so registered.

 

All Certificates issued upon any registration of transfer or exchange of Certificates shall constitute complete and indefeasible evidence of beneficial ownership in the Trust related to such Certificates and be entitled to the same benefits under this Agreement as the Certificates surrendered upon such registration of transfer or exchange.

 

Every Certificate presented or surrendered for registration of transfer or exchange shall be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Trustee and the Certificate Registrar, duly executed, by the Holder thereof or its attorney duly authorized in writing, with such signature guaranteed by a brokerage firm or financial institution that is a member of a Securities Approved Medallion Program such as Securities Transfer Agents Medallion Program (STAMP), Stock Exchange Medallion Program (SEMP) or New York Stock Exchange Inc. Medallion Signature Program (MSP).

 

No service charge shall be made to a Holder for any registration of transfer or exchange of Certificates, but the Trustee may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Certificates, other than exchanges pursuant to Section 5.3 not involving any transfer.

 

Section 5.5   Mutilated, Destroyed, Lost and Stolen Certificates.  If (i) any mutilated Certificate is surrendered to the Trustee at its Corporate Trust Office (in the case of Certificates) or (ii) the Depositor and the Trustee receive evidence to their satisfaction of the destruction, loss or theft of any Certificate, and there is delivered to the Depositor and the Trustee such security or indemnity as they may require to hold each of them and any Paying Agent harmless, and neither the Depositor nor the Trustee receives notice that such Certificate has been acquired by a protected purchaser, then the Trustee shall execute and the Trustee, upon receipt of a Depositor Order, shall authenticate and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Certificate a new Certificate of the same Series and Class of like tenor, form, terms and principal amount, bearing a number not contemporaneously Outstanding.

 

 

 

 

  

38

  

 

 

Upon the issuance of any new Certificate under this Section, the Depositor may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in respect thereto and any other expenses (including the fees and expenses of the Trustee) connected therewith.

 

Every new Certificate of any Series or Class issued pursuant to this Section shall constitute complete and indefeasible evidence of beneficial ownership in the Trust related to such Series, whether or not the destroyed, lost or stolen Certificate shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Agreement equally and proportionately with any and all other Certificates of that Series or Class duly issued hereunder.

 

The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Certificates.

 

Section 5.6   Distribution of Interest; Interest Rights Preserved.  (a)  Interest on any Certificate that is payable and is punctually paid or duly provided for on any Distribution Date shall be distributed to the Person in whose name such Certificate (or one or more Predecessor Certificates) is registered at the close of business on the related Record Date notwithstanding the cancellation of such Certificate upon any transfer or exchange subsequent to such related Record Date. The distribution of interest on Certificates shall be made at the Corporate Trust Office (except as otherwise specified pursuant to Section 5.1) or, at the option of the Trustee, by check mailed to the address of the Person entitled thereto as such address shall appear in the Certificate Register or, if provided pursuant to Section 5.1 and in accordance with arrangements satisfactory to the Trustee, at the option of the Holder by wire transfer to an account designated by the Holder.

 

(b)       Subject to the foregoing provisions of this Section 5.6, each Certificate delivered under this Agreement upon transfer of or in exchange for or in lieu of any other Certificate shall carry the rights to interest accrued and undistributed, and to accrue, that were carried by such other Certificate.

 

(c)       All computations of interest due with respect to any Certificate of any Series or Class within such Series shall be made as specified in the Series Supplement applicable to that particular Series or Class of Certificates.

 

(d)       With respect to any computations or calculations to be made under this Agreement, the applicable Series Supplement and the Certificates, except as otherwise provided, (i) all percentages resulting from any calculation of accrued interest will be rounded, if necessary, to the nearest 1/100,000 of 1% (.0000001), with five one-millionths of a percentage point rounded upward, and (ii) all currency amounts will be rounded to the nearest one-hundredth of a unit (with .005 of a unit being rounded upward).

 

(e)       Notwithstanding any other provisions in this Agreement, the right of the Holder of any Certificate to receive any of the payments described above in this Section 5.6, and to institute suit for the enforcement of any such payment on or after the date such payment is payable, shall not be impaired without the consent of such Holder.

 

 

  

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Section 5.7   Persons Deemed Owners.  The Depositor, the Trustee and the Administrative Agent, if any, and any agent of the Depositor, the Trustee or the Administrative Agent, if any, may treat the Person in whose name any Certificate is registered as the owner of such Certificate for the purpose of receiving distributions of principal of (and premium, if any) and (subject to Section 5.6) interest, if any, on such Certificate and for all other purposes whatsoever, whether or not such Certificate be overdue, and neither the Depositor, the Trustee, the Administrative Agent, if any, nor any agent of the Depositor, the Trustee nor the Administrative Agent, if any, shall be affected by notice to the contrary.  All distributions made to any Holder, or upon its order, shall be valid, and, to the extent of the sum or sums paid, effectual to satisfy and discharge the liability for moneys distributable upon such Certificate.

 

None of the Depositor, the Trustee, the Administrative Agent, if any, or any of their agents will have any responsibility or liability for any aspect of the records relating to or distributions made on account of beneficial ownership interests in a Global Security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests.

 

In connection with any notice or other communication to be provided to Holders pursuant to this Agreement by the Trustee with respect to any consent or other action to be taken by Holders, the Trustee shall establish a record date for such consent or other action and in the case of Global Certificates, give the Depositary notice of such record date not less than 15 calendar days in advance of such record date to the extent possible.  Such record date shall be the later of thirty (30) days prior to the first solicitation of such consent or other action or the date of the most recent list of Holders furnished to the Trustee pursuant to Section 3.19 hereof.

 

Section 5.8   Cancellation.  Unless otherwise specified pursuant to Section 5.1 for Certificates of any Series, all Certificates surrendered for payment, redemption, transfer or exchange shall, if surrendered to any Person other than the Trustee, be delivered to the Trustee and shall be promptly cancelled by it.  No Certificates shall be authenticated in lieu of or in exchange for any Certificates cancelled as provided in this Section, except as expressly permitted by this Agreement.

 

Section 5.9   Global Securities.  (a)  If the Series Supplement pursuant to Section 5.1 provides that a Series (or Class within such Series) of Certificates shall be represented by one or more Global Securities, then the Trustee shall execute and the Trustee shall authenticate and deliver one or more Global Securities that (i) shall represent an aggregate initial Certificate Principal Balance or Notional Amount, as applicable, equal to the aggregate initial Certificate Principal Balance or Notional Amount, as applicable, of the Certificates of such Series or Class to be represented by such one or more Global Securities, (ii) shall be registered, in the name of the Depositary for such Global Security or Securities or the nominee of such Depositary, (iii) shall be delivered by the Trustee to such Depositary or pursuant to such Depositary’s instruction and (iv) shall bear a legend substantially to the following effect:  “Unless and until it is exchanged in whole or in part for the individual Certificates represented hereby, this Global Security may not be transferred except as a whole by the Depositary to a nominee of the Depositary or by a nominee of the Depositary or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary.”

 

No Holder of a Certificate of such Series or Class will receive a Definitive Certificate representing such Holder’s interest in such Certificate or Certificates, except as provided in Section 5.11.  Unless and until definitive, fully registered Certificates (the “Definitive Certificates”) have been issued to Holders of such Series or Class pursuant to Section 5.11:

 

(i)   the provisions of this Section 5.9 shall be in full force and effect;

 

(ii)   the Certificate Registrar and the Trustee shall be entitled to deal with the Depositary for all purposes of this Agreement (including the distribution of principal of, and premium, if any, and interest on the Certificates and the giving of instructions or directions hereunder) and shall have no obligation to the Certificate Owners;

 

(iii)   to the extent that the provisions of this Section 5.9 conflict with any other provisions of this Agreement, the provisions of this Section 5.9 shall control;

 

(iv)   the rights of Certificate Owners of such Series or Class shall be exercised only through the Depositary and shall be limited to those established by law and agreements between such Certificate Owners and the Depositary or its Participants; and

 

(v)   whenever this Agreement requires or permits actions to be taken based upon instructions or directions of Holders of Certificates of such Series or Class evidencing a specified percentage of the aggregate Voting Rights of such Series or Class, the Depositary shall be deemed to represent such percentage only to the extent that it has received instructions to such effect from Certificate Owners of such Series or Class or Participants in such Depositary’s system owning or representing, respectively, such required percentage of the beneficial interest in the Certificates of such Series or Class and has delivered such instructions to the Trustee.

 

(b)        Each Depositary designated pursuant to Section 5.1 for a Global Security in registered form must, at the time of its designation and at all times while it serves as such Depositary, be a clearing agency registered under the Exchange Act and any other applicable statute or regulation.

 

Section 5.10   Notices to Depositary.  Whenever a notice or other communication to the Holders of a Series or Class within such Series represented by one or more Global Securities is required under this Agreement, unless and until Definitive Certificates for such Series or Class shall have been issued to such Certificate Owners pursuant to Section 5.11, the Trustee shall give all such notices and communications specified herein to be given to Holders of the Certificates of such Series to the Depositary, and shall have no obligation to the Certificate Owners.

 

 

  

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Section 5.11   Definitive Certificates.  If in respect of a Series (or Class within such Series) represented by one or more Global Securities (i) the Depositor advises the Trustee in writing that the Depositary is no longer willing or able to properly discharge its responsibilities with respect to the Certificates of such Series or Class and the Depositor is unable to locate a qualified successor, (ii) to the extent permitted by law, the Depositor at its option advises the Trustee in writing that it elects to terminate the book-entry system for such Series or Class through the Depositary or (iii) after the occurrence of an Administrative Agent Termination Event, Certificate Owners representing beneficial interests aggregating at least a majority (or such other Required Percentage--Definitive Certificates that may be specified in a Series Supplement) of the Voting Rights of the Certificates of such Series or Class advise the Depositary in writing that the continuation of a book-entry system for such Series or Class through the Depositary is no longer in the best interests of the Certificate Owners of such Series or Class, then the Depositary shall notify all Certificate Owners or Participants in the Depositary’s system with respect to such Series or Class and the Trustee of the occurrence of any such event and of the availability of Definitive Certificates for such Series or Class to Certificate Owners of such Series or Class.  Upon surrender to the Trustee of the Global Securities of such Series or Class by the Depositary, accompanied by registration instructions, the Trustee shall execute and the Trustee shall authenticate the Definitive Certificates of such Series or Class in accordance with the instructions of the Depositary.  None of the Depositor, the Certificate Registrar or the Trustee shall be liable for any delay in delivery of such instructions and may conclusively rely on, and shall be protected in relying on, such instructions. Upon the issuance of Definitive Certificates of such Series or Class, the Trustee shall recognize the holders of the Definitive Certificates of such Series or Class as Holders.

 

Section 5.12    Currency of Distributions in Respect of Certificates.

 

(a)      Except as otherwise specified pursuant to Section 5.1 for Certificates of any Series (or Class within such Series), distributions of the principal of (and premium, if any) and interest on Certificates of such Series or Class will be made in Dollars.

 

(b)        For purposes of any provision of the Agreement where the Holders of Outstanding Certificates may perform an act that requires that a specified percentage of the aggregate Voting Rights of the Certificates of all Series perform such act and for purposes of any decision or determination by the Trustee of amounts due and not distributed for the principal of (and premium, if any) and interest on the Certificates of all Series in respect of which moneys are to be disbursed ratably, the principal of (and premium, if any) or notional amount of, as applicable, and interest on the Outstanding Certificates denominated in a Foreign Currency will be the amount in Dollars based upon exchange rates, determined as specified pursuant to Section 5.1 for Certificates of such Series, as of the date for determining whether the Holders entitled to perform such act have performed it or as of the date of such decision or determination by the Trustee, as the case may be.

 

 

  

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(c)        With respect to Certificates of any Series (or Class within such Series), any decision or determination to be made regarding exchange rates shall be made by an Exchange Rate Agent appointed by the Depositor; provided that such Exchange Rate Agent shall accept such appointment in writing and the terms of such appointment shall be acceptable to the Trustee and shall, in the opinion of the Depositor at the time of such appointment, require such Exchange Rate Agent to make such determination by a method consistent with the method provided in the applicable Series Supplement for the making of such decision or determination. All decisions and determinations of such Exchange Rate Agent regarding exchange rates shall be in its sole discretion and shall, in the absence of manifest error, be conclusive for all purposes and irrevocably binding upon the Depositor, the Trustee and all Holders of the Certificates of such Series or Class.

 

(d)        If distributions in respect of a Certificate are required to be made in a Specified Currency other than Dollars and such currency is unavailable due to the imposition of exchange controls or other circumstance beyond the control of the Trustee, the Administrative Agent, if any, and the Depositor or is no longer used by the government of the country issuing such Specified Currency or is no longer commonly used for the settlement of transactions by public institutions of or within the international banking community, then all distributions in respect of such Certificate shall be made in Dollars until such Specified Currency is again so used in the manner specified in the related Series Supplement.

 

Section 5.13   Conditions of Authentication and Delivery of New Series.  Certificates of a new Series may be issued at any time and from time to time after the execution and delivery of this Agreement.  The Trustee shall execute and deliver Certificates of such Series to the Trustee and the Trustee shall authenticate and deliver such Certificates upon a Depositor Order and upon delivery by the Depositor to the Trustee of the following:

 

(1)      Board Resolution.  A Board Resolution (or action by a Person authorized by Board Resolution) authorizing the execution, authentication and delivery of the Certificates and specifying the Series, the Classes within such Series and their respective Final Scheduled Distribution Dates, priorities as to distributions of principal, premium (if any) and interest, aggregate initial Certificate Principal Balances and Notional Amounts, if any, and Pass Through Rates of, if any, each Class of such Series of Certificates to be authenticated and delivered and the method of calculation thereof.

 

(2)    Series Supplement.  A Series Supplement consistent with the applicable provisions of this Agreement, accompanied by a Board Resolution (or action by a Person authorized by Board Resolution) authorizing such Series Supplement (and, in the case of the first Series to be authenticated and delivered hereunder, authorizing this Agreement).

 

(3)    Certificates of the Depositor

 

(a)    An Officer’s Certificate of the Depositor, dated as of the Closing Date, to the effect that the Depositor is not in breach of this Agreement and that the issuance of the Certificates applied for will not result in any breach of any of the terms, conditions, or provisions of, or constitute a default under, the Depositor’s Certificate of Incorporation or bylaws, or any indenture, mortgage, deed of trust or other agreement or instrument to which the Depositor is a party or by which it or its property is bound or any order of any court or administrative agency entered in any Proceeding to which the Depositor is a party or by which it or its property may be bound or to which it or its property may be subject.

 

(b)   An Officer’s Certificate of the Depositor, dated as of the Closing Date, to the effect that attached thereto are true and correct copies of letters signed by the Rating Agency (or other evidence satisfactory to the Trustee) and confirming that the related Certificates have received the Required Rating.

 

 

  

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(4)   Requirements of Series Supplement.  Such other funds, accounts, documents, certificates, agreements, instruments or opinions as may be required by the terms of the Series Supplement creating such Series

.

If all the Certificates of a Series are not to be originally issued at the same time, then the documents required to be delivered pursuant to this Section 5.13 must be delivered only once, prior to the authentication and delivery of the first Certificate of such Series; provided, however, that any subsequent Depositor Order to the Trustee to authenticate Certificates of such Series upon original issuance shall constitute a representation and warranty by the Depositor that, as of the date of such request, the statements made in the Officer’s Certificates delivered pursuant to this Section 5.13 shall be true and correct as if made on such date.

 

Section 5.14   Appointment of Paying Agent.  The Trustee may appoint one or more paying agents (each, a “Paying Agent”) with respect to the Certificates of any Series.  Any such Paying Agent shall be authorized to make distributions to Certificateholders of such Series from the Certificate Account for such Series pursuant to the provisions of the applicable Series Supplement and shall report the amounts of such distributions to the Trustee.  Any Paying Agent shall have the revocable power to withdraw funds from such Certificate Account for the purpose of making the distributions referred to above.  The Trustee may revoke such power and remove the Paying Agent if the Trustee determines in its sole discretion that the Paying Agent shall have failed to perform its obligations under this Agreement in any material respect.  The Paying Agent shall initially be the Trustee and any co-paying agent chosen by the Depositor and acceptable to the Trustee, including, if and so long as any Series or Class within such Series is listed on the Luxembourg Stock Exchange and such exchange so requires, a co-paying agent in Luxembourg or another European city.  Any Paying Agent shall be permitted to resign as Paying Agent upon 30 days’ written notice to the Trustee.  In the event that the Trustee shall no longer be the Paying Agent, the Trustee shall appoint a successor or additional Paying Agent.  The Trustee shall cause each successor to act as Paying Agent to execute and deliver to the Trustee an instrument in which such successor or additional Paying Agent shall agree with the Trustee that (i) it will hold all sums, if any, held by it for distribution to the Certificateholders in trust for the benefit of the Certificateholders entitled thereto until such sums shall be distributed to such Certificateholders and (ii) it will give the Trustee notice of any default by any obligor on the applicable Series of Certificates or on the Underlying Securities.  

 

The Paying Agent shall return all unclaimed funds to the Trustee and upon removal shall also return all funds in its possession to the Trustee.  The provisions of Sections 8.1, 8.2, 8.3, 8.5 and 8.9 shall apply to the Trustee also in its role as Paying Agent, for so long as the Trustee shall act as Paying Agent.  Any reference in this Agreement to the Paying Agent shall include any co-paying agent unless the context requires otherwise.  Notwithstanding anything contained herein to the contrary, the appointment of a Paying Agent pursuant to this Section 5.14 shall not release the Trustee from the duties, obligations, responsibilities or liabilities arising under this Agreement other than with respect to funds paid to such Paying Agent.

 

 

  

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Section 5.15   Authenticating Agent.  (a)  The Trustee may appoint one or more Authenticating Agents (each, an “Authenticating Agent”) with respect to the Certificates of any Series which shall be authorized to act on behalf of the Trustee in authenticating such Certificates in connection with the issuance, delivery and registration of transfer or exchange of such Certificates.  Whenever reference is made in this Agreement to the authentication of Certificates by the Trustee or the Trustee’s certificate of authentication, such reference shall be deemed to include authentication on behalf of the Trustee by an Authenticating Agent and a certificate of authentication executed on behalf of the Trustee by an Authenticating Agent.  Each Authenticating Agent must be acceptable to the Depositor and the Administrative Agent, if any.  Notwithstanding anything contained herein to the contrary, the appointment of an Authenticating Agent pursuant to this Section 5.15 shall not release the Trustee from the duties, obligations, responsibilities or liabilities arising under this Agreement.

 

(b)        Any institution succeeding to the corporate agency business of any Authenticating Agent shall continue to be an Authenticating Agent without the execution or filing of any power or any further act on the part of the Trustee or such Authenticating Agent.  An Authenticating Agent may at any time resign by giving notice of resignation to the Trustee and to the Depositor.  The Trustee may at any time terminate the agency of an Authenticating Agent by giving notice of termination to such Authenticating Agent and to the Depositor.  Upon receiving such a notice of resignation or upon such a termination, or in case at any time an Authenticating Agent shall cease to be acceptable to the Trustee or the Depositor, the Trustee promptly may appoint a successor Authenticating Agent.  Any successor Authenticating Agent upon acceptance of its appointment hereunder shall become vested with all the rights, powers and duties of its predecessor hereunder, with like effect as if originally named as an Authenticating Agent.  No successor Authenticating Agent shall be appointed unless acceptable to the Administrative Agent, if any, and the Depositor.  The Trustee agrees to pay to each Authenticating Agent from time to time reasonable compensation for its services under this Section.  The provisions of Section 8.1, 8.2 and 8.3 shall be applicable to any Authenticating Agent.

 

 

 

  

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(c)      Pursuant to an appointment made under this Section, the Certificates may have endorsed thereon, in lieu of the Trustee’s certificate of authentication, an alternate certificate of authentication in substantially the following form:

 

This is one of the Certificates described in the Trust Agreement and the related Series Supplement.

 

 

	 	 	 
	 	 	 
	 	as Authenticating Agent	 
	 	      for the Trustee,	 
	 	 	 
	 	 	 
	 	By	 	 
	 	 	 Authorized Signatory	 

 

Section 5.16   Events of Default.  If any Event of Default shall occur and be continuing with respect to any class of Certificates, then, and in each and every case, the Trustee shall exercise any rights in respect of the related Underlying Securities as provided in the applicable Series Supplement.

 

Section 5.17   Control by Holders.  The Holders of Outstanding Certificates representing the Required Percentage -- Direction of Trustee shall, subject to provision being made for indemnification against costs, expenses and liabilities in a form satisfactory to the Trustee, have the right to direct the time, method and place of conducting any Proceeding for any remedy available to the Trustee with respect to any Underlying Securities Issuer payment default; provided, however, that:

 

(i)    such direction shall not be in conflict with any rule of law or with this Agreement;

 

(ii)    subject to Section 8.7, the Trustee need not take any action that it determines might cause it to incur any liability or might materially adversely affect the rights of any Holders not consenting to such action.

 

Section 5.18   Waiver of Past Defaults.

 

The Holders of Outstanding Certificates representing the Required Percentage -- Direction of Trustee may waive any past default and its consequences except (i) a Underlying Securities Issuer payment default or other default in the payment of principal of or interest on any of the Certificates or (ii) a default in respect of a covenant or provision hereof which cannot be modified or amended without the consent of the Holder of each Certificate.  In the case of any such waiver, the Depositor, the Trustee and the Holders shall be restored to their former positions and rights hereunder, respectively; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereto.

 

 

  

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ARTICLE VI

 

THE DEPOSITOR AND THE ADMINISTRATIVE AGENT

 

Section 6.1   Preparation and Filing of Exchange Act Reports; Obligations of the Depositor and the Administrative Agent.

 

(a)        (1) The Depositor shall (or shall engage the Trustee to) prepare for signature by the Depositor and file with the Commission, following the execution thereof by the Depositor, within the time period set forth below, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe), if any, which the Depositor on behalf of the Trust may be required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act or otherwise required by Regulation AB (collectively, “Exchange Act Reports”) with respect to the Trust.  The Depositor will be responsible for any reasonable fees and expenses assessed or incurred by the Trustee in connection with including information not in the forms provided to the Trustee by the Depositor and any fees associated with the filing of such reports.

 

          (2)    The names of such Reports and the dates on which they are required to be filed with the Commission are as follows:

 

(i)   Form 8-K, in substantially the form provided by the Depositor to the Trustee, within 15 calendar days after the Closing Date and each Distribution Date, and within the time advised to the Trustee by the Depositor if the filing of Form 8-K is necessary for any other reason;

 

(ii)   Form 10-D, in substantially the form previously provided by the Depositor to the Trustee, within 15 calendar days after each Distribution Date;

 

(iii)   Form 10-K, in substantially the form previously provided by the Depositor to the Trustee, within 90 calendar days after December 31 of each year; and

 

(iv)   such other Reports as the Depositor requests the Trustee to prepare and file from time to time as may be required pursuant to Section 13 or 15(d) of the Exchange Act or as otherwise required by Regulation AB at the expense of the Depositor and in the form provided by the Depositor to the Trustee.

 

Each annual report on Form 10-K will be signed by the Depositor and will include a certification required by Section 302 of the Sarbanes-Oxley Act of 2002, in the form prescribed by Item 601 of Regulation S-K under the Securities Act.

 

 

 

  

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The Depositor acknowledges and agrees that the performance of the Trustee’s obligations under this Section 6.1 is in part dependent upon the Depositor providing certain of  the relevant information to be included in the applicable reports in a timely fashion and upon one or more officers of the Depositor executing the applicable reports in a timely manner. The Depositor shall reasonably cooperate with the Trustee in connection with the Trustee’s performance of its obligations under this Section 6.1.  The Depositor shall designate the financial printer or other entity (the “Report Filer”) (which may be the Depositor) that will be responsible for the processing of the applicable reports and the Depositor shall reimburse the Trustee for the reasonable out of pocket fees of the Financial Filer; provided that, to the extent the Depositor fails to designate the Report Filer, the Trustee shall choose a Financial Filer. Notwithstanding the immediately preceding sentence, the Trustee shall have no liability for the performance of the Financial Filer to the extent any failure of the Financial Filer occurs through no fault of the Trustee. The Trustee shall have no liability with respect to any failure to properly or timely file such periodic reports resulting from or relating to the Trustee’s inability or failure to obtain any information required to be obtained by it not resulting from its own negligence or willful misconduct.

 

(b)      The Depositor shall deliver to the Trustee, not less often than annually, an Officer’s Certificate signed by an Executive Officer who is the principal executive officer, principal financial officer or principal accounting officer of the Depositor, dated on or prior to the date of the annual report on Form 10-K contemplated by clause (a)(iii) above, stating for such prior year that:

 

(i)   a review of the activities of the Depositor during such fiscal year and of performance under the related Trust Agreement has been made under such Executive Officer’s supervision;

 

(ii)   to the best of such Executive Officer’s knowledge, based on such review, the Depositor and the Trustee have each fulfilled its obligations under the related Trust Agreement throughout such year, or, if there has been a default in the fulfillment of any such obligation, specifying each such default known to such Executive Officer and the nature and status thereof;

 

(iii)   to the best of such Executive Officer’s knowledge, based on such review, the reports filed pursuant to Section 6.1(a), taken as a whole, do not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading as of the last day of the period covered by such certificate; and

 

(iv)   to the best of such Executive Officer’s knowledge, based on such review and reasonable reliance on information provided by the Trustee, the distribution and servicing information required to be provided to the Depositor by the Trustee for inclusion in the reports filed pursuant to Section 6.1(a)(i) is included in such reports.

 

The text of the Officer’s Certificate shall be revised accordingly in order to comply with any rules or other applicable laws of the Commission.

 

A copy of such certificate may be obtained by any Holder by a request in writing to the Depositor addressed to the Corporate Trust Office of the Trustee.

 

(c)       Each of the Trustee and the Administrative Agent (if any) shall provide, at the Depositor’s direction and expense, (i) reports on assessments of compliance with servicing criteria applicable to it under the Trust Agreement and (ii) attestation reports on assessments of compliance with servicing criteria prepared by a registered public accounting firm, both in order to satisfy the Trust’s obligations under Rules 13a-18 and 15d-18 of the Exchange Act and Items 1122 and 1123 of Regulation AB.

 

 

  

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A copy of any such report may be obtained by any Holder by a request in writing to the Depositor addressed to the Corporate Trust Office of the Trustee.

 

(d)   The Depositor shall deliver to the Trustee within 15 days after the Depositor is required to file the same with the Commission, such additional information, documents and reports with respect to compliance by the Depositor with the conditions and covenants of this Agreement, if any, as may be required to be filed with the Commission from time to time by such rules and regulations.

 

(e)   The Depositor shall deliver to the Trustee, which shall then transmit by mail to all Holders described in TIA Section 313(c), in the manner and to the extent provided therein, such summaries of any information, documents and reports required to be filed by the Depositor and received pursuant to this Section 6.1 if any, as may be required by rules and regulations prescribed from time to time by the Commission or as directed in writing by the Depositor.

 

(f)   If and only if the Series Supplement provides for the grant of a security interest in the Underlying Securities to the Trustee, on the Closing Date, the Depositor shall furnish to the Trustee an Opinion of Counsel either stating that, in the opinion of such counsel, such action has been taken with respect to the recording and filing of this Agreement, any agreements supplemental hereto and any other requisite documents, and with respect to the filing of any financing statements and continuation statements as are necessary to perfect and make effective the security interest of this Agreement and reciting the details of such action, or stating that, in the opinion of such counsel, no such action is necessary to make such lien and security interest effective.

 

(g)   If and only if the Series Supplement provides for the grant of a security interest in the Underlying Securities to the Trustee, at least annually after the Closing Date, the Depositor shall furnish to the Trustee an Opinion of Counsel either stating that, in the opinion of such counsel, such action has been taken with respect to the recording, filing, re-recording and refiling of this Agreement, any agreements supplemental hereto and any other requisite documents and with respect to the filing of any financing statements and continuation statements as is necessary to maintain the security interest created by this Agreement and reciting the details of such action or stating that in the opinion of such counsel no such action is necessary to maintain the security interest created by this Agreement.  Such Opinion of Counsel shall also describe the recording, filing, re-recording and refiling of this Agreement, any agreements supplemental hereto and any other requisite documents and the filing of any financing statements and continuation statements that will, in the opinion of such counsel, be required to maintain the security interest of this Agreement until such date in the following calendar year.

 

(h)   If and only if the Series Supplement provides for the grant of a security interest in the Underlying Securities to the Trustee,

 

 

  

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(i) whenever any property or securities are to be released from the lien of this Agreement, the Depositor shall furnish to the Trustee an Officer’s Certificate of the Depositor certifying or stating the opinion of each Person signing such certificate as to the fair value (within 90 days of such release) of the property or securities proposed to be released and stating that in the opinion of such person the proposed release will not impair the security under this Agreement in contravention of the provisions hereof.

 

(ii) whenever the Depositor is required to furnish to the Trustee an Officer’s Certificate of the Depositor certifying or stating the opinion of any signatory thereof as to the matters described in clause (i) above, the Depositor shall also furnish to the Trustee an Independent Certificate as to the same matters if the fair value of the property or securities and of all other property or securities released from the lien of this Agreement since the commencement of the then current calendar year, as set forth in the certificates required by clause (i) above and this clause (ii), equals 10% or more of the principal amount of the Outstanding Certificates, but such certificate need not be furnished in the case of any release of property or securities if the fair value thereof as set forth in the related Officer’s Certificate of the Depositor is less than $25,000 or less than one percent of the then principal amount of the Outstanding Certificates.

 

(iii) prior to the deposit with the Trustee of any securities that are to be made the basis for the authentication and delivery of Certificates, the withdrawal of cash constituting a part of the trust estate or the release of any property or securities subject to the lien of this Agreement, the Depositor shall furnish to the Trustee an Officer’s Certificate of the Depositor certifying or stating the opinion of each person signing such certificate as to the fair value (within 90 days of such deposit) to the Depositor of the securities to be so deposited.

 

(iv) whenever the Depositor is required to furnish to the Trustee an Officer’s Certificate of the Depositor described in clause (iii) above, the Depositor shall also deliver to the Trustee an Independent Certificate as to the same matters, if the fair value to the Depositor of the securities to be so deposited and of all other such securities made the basis of any such withdrawal or release since the commencement of the then current fiscal year of the Depositor, as set forth in the certificates delivered pursuant to clause (iii) above and this clause (iv), is 10% or more of the principal amount of the Outstanding Certificates, but such a certificate need not be furnished with respect to any securities so deposited, if the fair value thereof to the Depositor as set forth in the related Officer’s Certificate of the Depositor is less than $25,000 or less than one percent of the principal amount of the Outstanding Certificates.

 

(v) subject to the payment of its fees and expenses hereunder, the Trustee may, and when required by the provisions of this Agreement, shall, execute instruments to release property from the lien of this Agreement, or convey the Trustee’s interest in the same, in a manner and under circumstances that are consistent with the provisions of this Agreement.  No party relying upon an instrument executed by the Trustee in connection therewith shall be bound to ascertain the Trustee’s authority, inquire into the satisfaction of any conditions precedent or see to the application of any moneys.

 

 

  

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(vi)   the Trustee shall at such time as there are no Outstanding Certificates and all sums due to the Trustee hereunder have been paid, release any remaining portion of the trust estate that secured the Certificates from the lien of this Agreement and release to the Depositor or any other Person entitled thereto any funds then included in the trust estate.

 

(i)   Upon any application or request by the Depositor to the Trustee to take any action under the provisions of this Agreement, which action is subject to the satisfaction of a condition precedent (including any covenants compliance with which constitutes a condition precedent), the Depositor shall furnish to the Trustee: (i) an Officer’s Certificate stating that all conditions precedent, if any, provided for in this Agreement relating to the proposed action have been complied with, (ii) an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with and (iii) (if required by the TIA) an Independent Certificate from a firm of certified public accountants meeting the applicable requirements of the TIA, except that, in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Agreement, no additional certificate or opinion need be furnished.  Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Agreement shall include:

 

(i)   a statement that such signatory of such certificate or opinion has read or has caused to be read such covenant or condition and the definitions herein relating thereto;

 

(ii)   a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

 

(iii)   a statement that, in the judgment of each such signatory, such signatory has made such examination or investigations as is necessary to enable such signatory to express an informed opinion as to whether or not such covenant or condition has been complied with; and

 

(iv)   a statement as to whether, in the opinion of each such signatory, such condition or covenant has been complied with.

 

Section 6.2   Merger or Consolidation of the Depositor or the Administrative Agent.  (a)  Subject to the following paragraph, the Depositor will keep in full effect its existence, rights and franchises as a corporation under the laws of the jurisdiction of its incorporation, and the Administrative Agent, if any, will keep in full effect its existence, rights and franchises under the laws of the jurisdiction of its incorporation or association.  The Depositor and the Administrative Agent, if any, each will obtain and preserve its qualification to do business as a foreign corporation or association in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of this Agreement, the Certificates or any of the Underlying Securities and to perform its respective duties under this Agreement.

 

 

  

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(b)       The Depositor and an Administrative Agent, if any, may consolidate or merge with or into any other Person, provided that:

 

(i)   the Person (if other than the Depositor or Administrative Agent, as applicable) formed by or surviving such consolidation or merger shall expressly assume, by an agreement supplemental hereto executed and delivered to the Trustee, in form satisfactory to the Trustee, the performance or observance of every agreement and covenant of this Agreement on the part of the Depositor or Administrative Agent, as applicable, to be performed or observed, all as provided herein and in the applicable Series Supplement or Supplements;

 

(ii)   immediately after giving effect to such transaction, no Administrative Agent Termination Event or event which with the passage of time or notice or both would become an Administrative Agent Termination Event shall have occurred and be continuing;

 

(iii)   the Rating Agency Condition shall have been satisfied with respect to such transaction; and

 

(iv)   the Depositor or Administrative Agent, as applicable, shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel each stating that such consolidation or merger and such supplemental agreement comply with this Article VI and that all conditions precedent herein provided for relating to such transaction have been complied with.

 

Section 6.3   Limitation on Liability of the Depositor and the Administrative Agent.  (a) Unless otherwise expressly specified in this Agreement or a Series Supplement, neither the Administrative Agent, if any, nor the Depositor shall be under any obligation to expend or risk its own funds or otherwise incur financial liability in the performance of its duties hereunder or under a Series Supplement or in the exercise of any of its rights or powers if reasonable grounds exist for believing that the repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

 

(b)       Neither the Depositor, an Administrative Agent, if any, nor any of the directors, officers, employees or agents of the Depositor or such Administrative Agent shall be under any liability to any Trust or the Certificateholders of any Series for any action taken, or for refraining from the taking of any action, in good faith pursuant to this Agreement, or for errors in judgment; provided, however, that this provision shall not protect the Depositor, any such Administrative Agent or any such person against any breach of warranties, representations or covenants made herein, or against any specific liability imposed on such Administrative Agent pursuant hereto, or against any liability which would otherwise be imposed by reason of willful misfeasance, bad faith or negligence in the performance of duties or by reason of reckless disregard of obligations and duties hereunder.

 

 

 

  

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Neither the Depositor nor an Administrative Agent, if any, shall be under any obligation to appear in, prosecute or defend any legal action unless such action is related to its respective duties under this Agreement and, in its opinion, does not involve it in any expense or liability; provided, however, that either of the Depositor or such Administrative Agent may in its discretion undertake any such action which it may deem necessary or desirable with respect to this Agreement and the rights and duties of the parties hereto and the interests of the Certificateholders hereunder.  The legal expenses and costs of such action and any liability resulting (except any loss, liability or expense incurred by reason of willful misfeasance, bad faith or negligence in the performance of duties hereunder or by reason of reckless disregard of obligations and duties hereunder) shall be allocated as specified in the applicable Series Supplement.

 

Section 6.4   Limitation on Resignation of the Administrative Agent.  An Administrative Agent appointed pursuant to the applicable Series Supplement shall not resign from the obligations and duties hereby imposed on it except (a) upon appointment by the Trustee of a successor administrative agent and receipt by the Trustee of a letter from the Rating Agency that such a resignation and appointment will satisfy the Rating Agency Condition or (b) upon a determination that its duties hereunder are no longer permissible under applicable law.  Any such determination pursuant to clause (b) of the preceding sentence permitting the resignation of the Administrative Agent shall be evidenced by an Opinion of Counsel to such effect delivered to the Trustee and the Depositor.  No resignation of an Administrative Agent shall become effective until a successor administrative agent shall have assumed the Administrative Agent’s responsibilities, duties, liabilities (other than those liabilities arising prior to the appointment of such successor) and obligations under this Agreement.

 

Section 6.5   Rights of the Depositor in Respect of the Administrative Agent.  An Administrative Agent appointed pursuant to the applicable Series Supplement shall afford the Depositor and the Trustee, upon reasonable notice, during normal business hours, access to all records maintained by the Administrative Agent in respect of its rights and obligations hereunder and access to officers of the Administrative Agent responsible for such obligations. Upon request, the Administrative Agent shall furnish to the Depositor and the Trustee the Administrative Agent’s most recent financial statements and such other information relating to its capacity to perform its obligations under this Agreement as the Administrative Agent possesses.  To the extent such information is not otherwise available to the public, the Depositor and the Trustee shall not disseminate any information obtained pursuant to the preceding two sentences without the Administrative Agent’s written consent, except as required pursuant to this Agreement to the extent that it is appropriate to do so (i) in working with legal counsel, auditors, taxing authorities or other governmental agencies or (ii) pursuant to any law, rule, regulation, order, judgment, writ, injunction or decree of any court or governmental authority having jurisdiction over the Depositor, the Trustee or the Trust.  The Depositor may, but is not obligated to, enforce the obligations of the Administrative Agent under this Agreement and may, but is not obligated to, perform, or cause a designee to perform, any defaulted obligation of the Administrative Agent under this Agreement or exercise the rights of the Administrative Agent under this Agreement; provided, however, that the Administrative Agent shall not be relieved of any of its obligations under this Agreement by virtue of such performance by the Depositor or its designee.  The Depositor shall not have any responsibility or liability for any action or failure to act by the Administrative Agent and is not obligated to supervise the performance of the Administrative Agent under this Agreement or otherwise.

 

 

  

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Section 6.6   Depositor May Purchase Certificates.  The Depositor may at any time purchase Certificates in the open market or otherwise.  Certificates so purchased by the Depositor may, at the discretion of the Depositor, be held or resold.  Certificates beneficially owned by the Depositor will be disregarded for purposes of determining whether the required percentage of the aggregate Voting Rights has given any request, demand, authorization, direction, notice, consent or waiver hereunder.

 

Section 6.7   The Administrative Agent and Other Parties.  The Person serving as an Administrative Agent, if any, appointed pursuant to the applicable Series Supplement may be the Depositor, the Trustee or an Affiliate of either thereof, and may have normal business relationships with the Depositor, the Trustee or any Affiliates thereof.

 

Section 6.8   Preferential Collection of Claims Against Depositor.  The Trustee shall comply with TIA Section 311(a), excluding any creditor relationship listed in TIA Section 311(b).  A trustee who has resigned or been removed shall be subject to TIA Section 311(a) to the extent required by TIA Section 311(a).

 

ARTICLE VII

 

ADMINISTRATIVE AGENT TERMINATION EVENTS

 

Section 7.1   Administrative Agent Termination Events.  (a)“ Administrative Agent Termination Event,” wherever used herein with respect to any Series of Certificates, means any one of the following events:

 

(i)      a failure by any Administrative Agent specified in the applicable Series Supplement to remit to the Trustee, pursuant to the terms of this Agreement, any funds in respect of collections on Underlying Securities, Credit Support, if any, and Advances, if any, collected by the Administrative Agent pursuant to the terms of this Agreement that continues unremedied for a period of five days after the date upon which written notice of such failure, requiring the same to be remedied, shall have been given to the Administrative Agent by the Depositor or the Trustee (in which case notice shall be provided by telecopy), or to the Administrative Agent, the Depositor and the Trustee by the Holders of Certificates of such Series representing at least 25% of the aggregate Voting Rights; or

 

(ii)     a failure on the part of any Administrative Agent specified in the applicable Series Supplement to observe or perform in any material respect any other of the covenants or agreements on the part of the Administrative Agent contained in the Certificates of such Series or in this Agreement which continues unremedied for a period of 30 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Administrative Agent by the Depositor or the Trustee, or to the Administrative Agent, the Depositor and the Trustee by the Holders of Certificates of such Series representing at least 25% of the aggregate Voting Rights; or

 

 

  

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(iii)   a decree or order of a court or agency or supervisory authority having jurisdiction in an involuntary case under any present or future Federal or State bankruptcy, insolvency or similar law or the appointment of a conservator or receiver or liquidator in any insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceeding, or for the winding up or liquidation of its affairs, shall have been entered against the Administrative Agent, if any, specified in the applicable Series Supplement and such decree or order shall have remained in force undischarged or unstayed for a period of 30 days; or

 

(iv)   any Administrative Agent specified in the applicable Series Supplement shall consent to the appointment of a conservator or receiver or liquidator in any insolvency, readjustment of debt, marshalling of assets and liabilies or similar proceedings of or relating to the Administrative Agent or of or relating to all or substantially all its property; or

 

(v)   any Administrative Agent specified in the applicable Series Supplement shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable insolvency or reorganization statute, make an assignment for the benefit of its creditors, or voluntarily suspend payment of its obligations; or

 

(vi)   if so specified in the related Series Supplement, any failure of the Administrative Agent, if any, specified in the applicable Series Supplement to make any Advances required to be made from its own funds pursuant to Section 4.3 which continues unremedied until twelve o’clock noon New York City time on the Business Day immediately following the day on which such Advance was required to have been made; or

 

(vii)   any additional Administrative Agent Termination Event that may be specified with respect to such Series in the related Series Supplement.

 

Each Series Supplement shall specify as to each of the foregoing clauses requiring a vote of Holders of different Classes the circumstances and manner in which the aggregate Voting Rights applicable to each such clause shall be calculated.

 

(b)      Unless otherwise provided in the applicable Series Supplement and provided an Administrative Agent shall have been appointed pursuant to the applicable Series Supplement, so long as an Administrative Agent Termination Event with respect to the related Series of Certificates shall have occurred and be continuing, the Depositor or the Trustee may, and at the written direction of the Holders of Certificates evidencing not less than the “Required Percentage--Administrative Agent Termination” of the aggregate Voting Rights, the Trustee shall, by notice in writing to such Administrative Agent (and to the Depositor if given by the Trustee or to the Trustee if given by the Depositor) terminate all the rights and obligations of the Administrative Agent specified in the applicable Series Supplement in its capacity as Administrative Agent with respect to such Series under this Agreement, to the extent permitted by law.  The Administrative Agent, if any, specified in the applicable Series Supplement agrees promptly (and in any event not later than ten Business Days subsequent to such notice) to provide the successor administrative agent with all documents and records requested by it to enable it to assume the functions of the Administrative Agent under this Agreement relating to such Series, and to cooperate with the Trustee in effecting the termination of the Administrative Agent’s responsibilities and rights under this Agreement relating to such Series, including the transfer within one Business Day to the successor administrative agent for administration by it of all cash amounts and investments which shall at the time be or should have been credited by the Administrative Agent to the Certificate Account relating to such Series or thereafter be received with respect to such Underlying Securities; provided, however, that the Administrative Agent shall continue to be entitled to receive all amounts accrued or owing to it under this Agreement on or prior to the date of such termination, whether in respect of Advances or otherwise, and shall continue to be entitled to the benefits of Section 6.3 notwithstanding any such termination.

 

 

  

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Section 7.2   Trustee to Act; Appointment of Successor.  The Trustee shall promptly appoint, or petition a court of competent jurisdiction to appoint, an Administrative Agent acceptable to the Rating Agency (such acceptance to be evidenced by satisfaction of the Rating Agency Condition with respect to such appointment) and having a net worth of not less than $15,000,000, as the successor to such Administrative Agent under this Agreement with respect to such Series in the assumption of all or any part of the responsibilities, duties or liabilities of such Administrative Agent under this Agreement with respect to such Series.  The Trustee, the Depositor and any such successor Administrative Agent may agree upon the compensation to be paid with respect thereto.  No appointment of a successor Administrative Agent under this Agreement shall be effective until the assumption by the successor Administrative Agent of all the responsibilities, duties and liabilities placed on the Administrative Agent hereunder and under the related Series Supplement.

 

Section 7.3   Notification to Certificateholders.  (a) Upon any such termination pursuant to Section 7.2 or appointment of a successor Administrative Agent, the Trustee shall give prompt written notice thereof to Certificateholders of the affected Series in the manner provided in Section 10.5.

 

(b)          Within 60 days after the occurrence of any Administrative Agent Termination Event or event which but for the lack of notice or passage of time or both would constitute an Administrative Agent Termination Event with respect to any Series, the Trustee shall transmit by mail to all Certificateholders of such Series notice of each such Administrative Agent Termination Event or event which but for lack of notice or passage of time or both would constitute an Administrative Agent Termination Event which is known to the Trustee, unless such Administrative Agent Termination Event or event which but for lack of notice or passage of time or both would constitute an Administrative Agent Termination Event shall have been cured or waived.

 

 

 

  

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Section 7.4   Waiver of Administrative Agent Termination Events.  Unless otherwise provided in the applicable Series Supplement, the Holders of Certificates of the related Series evidencing not less than the Required Percentage--Waiver of the aggregate Voting Rights may, on behalf of all Certificateholders of such Series, (i) if so provided in the applicable Series Supplement, waive compliance by the Depositor, the Trustee or the Administrative Agent, if any, with certain restrictive provisions of this Agreement as set forth in such Series Supplement prior to the time such compliance is required and (ii) waive any Administrative Agent Termination Event or event which but for lack of notice or passage of time or both would constitute an Administrative Agent Termination Event with respect to such Series; provided, however, that an Administrative Agent Termination Event or event which but for lack of notice or passage of time or both would constitute an Administrative Agent Termination Event with respect to such Series regarding the failure to distribute, in accordance with the terms of this Agreement, amounts received with respect to any Underlying Security or any such event with respect to such Series in respect of a covenant or provision of this Agreement the modification or amendment of which would require the consent of the Holders of all outstanding Certificates of such Series, may be waived only by all the Certificateholders of such Series.  Upon any such waiver of an Administrative Agent Termination Event or event which but for lack of notice or passage of time or both would constitute an Administrative Agent Termination Event with respect to such Series, such Administrative Agent Termination Event or event which but for lack of notice or passage of time or both would constitute an Administrative Agent Termination Event shall cease to exist and shall be deemed to have been remedied for every purpose hereunder.  No such waiver shall extend to any subsequent or other Administrative Agent Termination Event or event which but for lack of notice or passage of time or both would constitute an Administrative Agent Termination Event or impair any right consequent thereon except to the extent expressly so waived.

 

ARTICLE VIII

 

CONCERNING THE TRUSTEE

 

Section 8.1   Duties of Trustee; Notice of Defaults.  (a) The Trustee, prior to the occurrence of an Event of Default with respect to any Series and after the curing of all such Events of Default which may have occurred, undertakes to perform such duties and only such duties as are specifically set forth in this Agreement and the related Series Supplement.  During the period an Event of Default with respect to any Series shall have occurred and be continuing, the Trustee shall exercise such of the rights and powers vested in it by this Agreement, and shall use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs.  Any permissive right of the Trustee enumerated in this Agreement shall not be construed as a duty.

 

(b)        The Trustee, upon receipt of all resolutions, certificates, statements, opinions, reports, documents, orders or other instruments furnished to the Trustee which are specifically required to be furnished pursuant to any provision of this Agreement, shall examine them to determine whether they conform to the requirements of this Agreement.  If any such instrument is found not to conform to the requirements of this Agreement, the Trustee shall take action as it deems appropriate to have the instrument corrected, and if the instrument is not corrected to the Trustee’s satisfaction, the Trustee will provide notice thereof to the Depositor, Administrative Agent, if any, and Certificateholders.

 

 

 

  

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(c)          No provision of this Agreement shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act or its own misconduct; provided, however, that:

 

(i)     prior to the occurrence of an Event of Default with respect to any Series, and after the curing of all such Events of Default which may have occurred, the duties and obligations of the Trustee shall be determined solely by the express provisions of this Agreement, the Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Agreement, no implied covenants or obligations shall be read into this Agreement against the Trustee and, in the absence of bad faith on the part of the Trustee, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificates or opinions furnished to the Trustee that conform to the requirements of this Agreement;

   

(ii)    the Trustee shall not be personally liable for an error of judgment made in good faith by a Responsible Officer or Responsible Officers of the Trustee, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts; and

 

(iii)     the Trustee shall not be personally liable with respect to any action taken, suffered or omitted to be taken by it in good faith in accordance with the direction of Holders of the Required Percentage--Direction of Trustee of the aggregate Voting Rights of a given Series (or Class or group of Classes within such Series) relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Agreement;

 

(iv)    the Trustee shall not be required to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers if there is reasonable ground for believing that the repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it, and none of the provisions contained in this Agreement shall in any event require the Trustee to perform, or be responsible for the manner of performance of, any obligations of an Administrative Agent, if any, appointed pursuant to the applicable Series Supplement, under this Agreement except during such time, if any, as the Trustee shall be the successor to, and be vested with the rights, duties, powers and privileges of, such an Administrative Agent in accordance with and only to the extent provided in this Agreement;

 

(v)    except for actions expressly authorized by this Agreement, the Trustee shall take no actions reasonably likely to impair the interests of the Trust in any Underlying Security now existing or hereafter acquired or to impair the value of any Underlying Security now existing or hereafter acquired;

 

(vi)    except as expressly provided in this Agreement, the Trustee shall not engage in any activity other than those required or authorized by the terms of this Agreement.  In particular, after the Closing Date the Trustee shall not purchase or otherwise acquire any additional securities, modify or permit the modification of any Trust Asset or otherwise vary the investment of the Certificateholders or incur or modify any obligations, (i) except as expressly required or permitted by the terms of this Agreement or (ii) unless the Trustee obtains, at the expense of the Certificateholders, an Opinion of Counsel to the effect that such acquisition, incurrence or modification will not cause the Trust (unless otherwise indicated in a related Series Supplement) to fail to be classified as either a grantor trust or a partnership (other than a publicly traded partnership treated as a corporation) for U.S. federal income tax purposes; and

 

 

  

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(vii)    in the event that the Paying Agent or the Certificate Registrar shall fail to perform any obligation, duty or agreement in the manner or on the day required to be performed by the Paying Agent or Certificate Registrar, as the case may be, under this Agreement, the Trustee shall be obligated promptly upon its knowledge thereof to perform such obligation, duty or agreement in the manner so required.

 

(d)         The Trustee shall have the legal power to exercise all of the rights, powers and privileges of holders of the Underlying Securities in which the Certificates evidence an interest.  However, neither the Trustee (except as specifically provided herein or in the TIA) nor the Depositor shall be under any obligation whatsoever to appear in, prosecute or defend any action, suit or other proceeding in respect of Underlying Securities or Certificates.

 

(e)      Neither the Trustee nor the Depositor shall have any obligation on or with respect to the Underlying Securities, except as provided in this Article VIII with respect to the Trustee; and their respective obligations with respect to Certificates shall be solely as set forth in this Agreement.

 

(f)       If there is an event of default (as defined in the indenture or other document pursuant to which the Underlying Securities were issued) with respect to any Underlying Security and such default is known to the Trustee, the Trustee shall promptly give notice to the Depositary or, if the Certificates are Definitive Certificates, directly to Holders thereof as provided in Section 10.5 hereof (and in the manner and to the extent provided in TIA Section 313(c)) within the later of (1) 90 days after such event of default occurs or (2) 30 days after which the Trustee has knowledge of such default.  Such notice shall set forth (i) the identity of the Underlying Securities, (ii) the date and nature of such default, (iii) the face amount of the obligation to which such default relates, (iv) the identifying numbers of the Series and Class of Certificates, or any combination, as the case may be, evidencing the obligations (or portions thereof) described above in clause (iii), and (v) any other information which the Trustee may deem appropriate.  Except in the case of a default in payment of principal or interest (including payments pursuant to a redemption of any Certificate), the Trustee may withhold the notice to Holders if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of the Holders.

 

(g)       Holders of Certificates shall have no recourse against the Depositor or the Trustee for payment defaults on the Underlying Securities.

 

(h)       Whether or not therein expressly so provided, every provision of this Agreement relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section.   

 

Section 8.2    Certain Matters Affecting the Trustee.  (a)  Except as otherwise provided in Section 8.1:

 

(i)     the Trustee may request and rely upon and shall be protected in acting or refraining from acting upon any resolution, Officer’s Certificate, certificate of auditors or any other certificate, statement, instrument, opinion, report, notice, request, consent, order, appraisal, bond or other paper or document reasonably believed by it to be genuine and to have been signed or presented by the proper party or parties;

 

 

  

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(ii)   the Trustee may consult with counsel and any written advice or Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken or suffered or omitted by it hereunder in good faith and in accordance with such written advice or Opinion of Counsel;

 

(iii)   the Trustee shall be under no obligation to exercise any of the trusts or powers vested in it by this Agreement or to institute, conduct or defend any litigation hereunder or in relation hereto, at the request, order or direction of any of the Certificateholders, pursuant to the provisions of this Agreement, unless such Certificateholders shall have offered to the Trustee security or indemnity reasonably satisfactory to it against the costs, expenses and liabilities which may be incurred therein or thereby; provided, however, as described above that nothing contained herein shall relieve the Trustee of the obligations, upon the occurrence of an Administrative Agent Termination Event or Event of Default (which has not been cured or waived), to exercise such of the rights and powers vested in it by this Agreement, and to use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs;

 

(iv)   the Trustee shall not be personally liable for any action taken, suffered or omitted by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Agreement;

 

(v)   the Trustee shall not be bound to make any investigation into the facts of matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, appraisal, approval, bond or other paper or document believed by it to be genuine, unless requested in writing to do so by Holders of the Required Percentage--Direction of Trustee of the aggregate Voting Rights of the affected Series (or Class or Classes within any such Series), as specified by the applicable Series Supplement; provided, however, that if the payment within a reasonable time to the Trustee of the costs, expenses or liabilities likely to be incurred by it in the making of such investigation is, in the opinion of the Trustee, not reasonably assured to the Trustee by the security afforded to it by the terms of this Agreement, the Trustee may require reasonable indemnity against such expense or liability as a condition to taking any such action;

 

(vi)   except as provided in a Series Supplement with respect to custody of the Underlying Securities, the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys or a custodian and shall not be liable for such persons’ actions if it has selected such persons with reasonable care;

 

 

  

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(vii)  the Trustee shall not be personally liable for any loss resulting from the investment of funds held in any Certificate Account or Reserve Account at the direction of an Administrative Agent or the Depositor pursuant to Section 3.10;

 

(viii)  the Trustee shall not be deemed to have notice of any Event of Default unless a Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a default is received by the Trustee at the Corporate Trust Office of the Trustee, and such notice references the Certificates and this Agreement;

 

(ix)   in no event shall the Trustee be responsible or liable for special, indirect, punitive or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action; and

 

(x)    the rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and other Person employed by it to act hereunder.

 

(b)       All rights of action under this Agreement or under any of the Certificates, enforceable by the Trustee, may be enforced by it without the possession of any of the Certificates of any Series (or Class within such Series), or the production thereof at the trial or other Proceeding relating thereto, and any such suit, action or proceeding instituted by the Trustee shall be brought in its name for the benefit of all the Holders of such Certificates, subject to the provisions of this Agreement.

 

(c)        To the extent that the Trust is incompetent or unqualified to perform any obligation required to be performed by the Trust by the terms of this Agreement, then the Trustee on behalf of the Trust shall perform such obligation (unless the Trustee is also incompetent or unqualified, in which case Sections 8.7 and 8.10 shall apply).

 

Section 8.3   Trustee Not Liable for Recitals in Certificates or Underlying Securities.  The Trustee assumes no responsibility for the correctness of the recitals contained herein and in the Certificates or in any document issued in connection with the sale of the Certificates (other than the signature and authentication on the Certificates).  Except as set forth in Section 8.12, the Trustee makes no representations or warranties as to the validity or sufficiency of this Agreement or of the Certificates of any Series (other than the signature and authentication on the Certificates) or of any Underlying Security or related document. The Trustee shall not be accountable for the use or application by the Depositor or the Administrative Agent, if any, of any of the Certificates or of the proceeds of such Certificates.

 

Section 8.4   Trustee May Own Certificates.  The Trustee in its individual capacity or any other capacity may become the owner or pledgee of Certificates with the same rights it would have if it were not Trustee.

 

 

  

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Section 8.5   Trustee’s Fees and Expenses; Indemnification; Undertaking for Costs.  (a) The Trustee shall be entitled to receive from the Depositor or an affiliate of the Depositor as compensation for the Trustee’s services hereunder, trustee’s fees pursuant to a separate written agreement between the Trustee and the Depositor, and shall be reimbursed for all reasonable expenses, disbursements and advances incurred or made by the Trustee (including the reasonable compensation, disbursements and expenses of its counsel and other persons not regularly in its employ).  The Depositor shall indemnify and hold harmless the Trustee and its successors, assigns, agents and servants against any and all loss, liability or reasonable expense (including attorney’s fees) incurred by it in connection with the administration of this trust and the performance of its duties thereunder.  The Trustee shall notify the Depositor promptly of any claim for which it may seek indemnity.  Failure by the Trustee to so notify the Depositor shall not relieve the Depositor of its obligations hereunder.  The Depositor need not reimburse any expense or indemnify against any loss, liability or expense incurred by the Trustee through the Trustee’s own willful misconduct, negligence or bad faith.  The indemnities contained in this Section 8.5(a) shall survive the resignation or termination of the Trustee or the termination of this Agreement.

 

(b)          Failure by the Depositor to pay, reimburse or indemnify the Trustee shall not entitle the Trustee to any payment, reimbursement or indemnification from the Trust, nor shall such failure release the Trustee from the duties it is required to perform under this Agreement.  Any unpaid, unreimbursed or unindemnified amounts shall not be borne by the Trust and shall not constitute a claim against the Trust.

 

(c)         All parties to this Agreement agree, and each Holder of any Certificate by such Holder’s acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any Proceeding for the enforcement of any right or remedy under this Agreement, or in any Proceeding against the Trustee for any action taken, suffered or omitted by it as Trustee, the filing by any party litigant in such Proceeding of an undertaking to pay the costs of such Proceeding and that such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in such Proceeding, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section 8.5(c) shall not apply to:

 

(i)   any Proceeding instituted by the Trustee;

 

(ii)   any Proceeding instituted by any Holder, or group of Holders, in each case holding in the aggregate Outstanding Certificates representing more than 10% of the Voting Rights; or

 

(iii)   any Proceeding instituted by any Holder for the enforcement of the payment of principal or interest on or after the respective due dates expressed in such Certificate and in this Agreement (or, in the case of redemption, on or after the redemption date).

 

 

  

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Section 8.6   Eligibility Requirements for Trustee.  (a)  The Trustee shall at all times satisfy the requirements of TIA Section 310(a).  The Trustee hereunder shall at all times be a corporation which is not an Affiliate of the Depositor (but may have normal banking relationships with the Depositor or any obligor with respect to the Underlying Securities with respect to such Series of Certificates and their respective Affiliates) organized and doing business under the laws of any State or the United States, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least $50,000,000 and subject to supervision or examination by Federal or State authority. If such corporation or association publishes reports of conditions at least annually, pursuant to law or to the requirements of the aforesaid supervising or examining authority, then for the purposes of this Section the combined capital and surplus of such corporation or association shall be deemed to be its combined capital and surplus as set forth in its most recent report of conditions so published.  Such corporation or association must be rated in one of the four highest rating categories by the Rating Agency.

 

(b)        The Trustee shall comply with Section 310(b); provided, however, that there shall be excluded from the operation of TIA Section 310(b)(1), any Series Supplement under which other securities are outstanding evidencing ownership interest in obligations of the Underlying Securities Issuer if the requirements for such exclusion set forth in TIA Section 310(b)(1) are met.

 

Section 8.7   Resignation or Removal of the Trustee.  (a)  The Trustee may, with respect to any Series of Certificates, at any time resign and be discharged from any trust hereby created by giving written notice thereof to the Depositor, the Administrative Agent, if any, the Rating Agency and to all Certificateholders of such Series.  Upon receiving such notice of resignation, the Depositor shall promptly appoint a successor trustee for such Series by written instrument, in duplicate, which instrument shall be delivered to the resigning Trustee and to the successor trustee.  A copy of such instrument shall be delivered to such Certificateholders and the Administrative Agent, if any, by the Depositor.  If no such successor trustee shall have been so appointed and have accepted appointment within 30 days after the giving of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor trustee for such Series.

 

(b)         If at any time the Trustee shall cease to be eligible in accordance with the provisions of Section 8.6 and shall fail to resign after written request therefor by the Depositor, or if at any time the Trustee shall become incapable of acting, or shall be adjudged bankrupt or insolvent, or a receiver of the Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then the Depositor may remove the Trustee and appoint a successor trustee by written instrument, in duplicate, which instrument shall be delivered to the Trustee so removed and to the successor trustee.  A copy of such instrument shall be delivered to the Certificateholders and the Administrative Agent, if any, by the Depositor.

 

(c)         The Holders of Certificates of any Series representing the Required Percentage--Removal of Trustee of the aggregate Voting Rights may at any time remove the Trustee and appoint a successor trustee by written instrument or instruments, in triplicate, signed by such Holders or their attorneys-in-fact and duly authorized, one complete set of which instruments shall be delivered to the Depositor, one complete set to the Trustee so removed and one complete set to the successor trustee so appointed.  A copy of such instrument shall be delivered to the Certificateholders and the Administrative Agent, if any, by the Depositor.

 

 

  

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(d)        Any resignation or removal of the Trustee and appointment of a successor trustee pursuant to any of the provisions of this Section shall not become effective until acceptance of appointment by the successor trustee as provided in Section 8.8.

 

Section 8.8   Successor Trustee.  (a) Any successor trustee appointed as provided in Section 8.7 shall execute, acknowledge and deliver to the Depositor and to its predecessor trustee an instrument accepting such appointment hereunder, and thereupon the resignation or removal of the predecessor trustee shall become effective and such successor trustee, without any further act, deed or conveyance, shall become fully vested with all the rights, powers, duties and obligations of its predecessor hereunder (either with respect to a given Series of Certificates or with respect to all Certificates issued under this Agreement), with the like effect as if originally named as trustee herein.  The predecessor trustee shall deliver to the successor trustee all documents, statements, and other property (including the Underlying Securities) held by it hereunder, and the Depositor and the predecessor trustee shall execute and deliver such instruments and do such other things as may reasonably be required for more fully and certainly vesting and confirming in the successor trustee all such rights, powers, duties and obligations.  No successor trustee shall accept appointment as provided in this Section unless at the time of such acceptance such successor trustee shall be eligible under the provisions of Section 8.6.

 

(b)        Upon acceptance of appointment by a successor trustee as provided in this Section, the Depositor shall transmit notice of the succession of such trustee hereunder to all Holders of Certificates and to the Rating Agency in the manner provided in Section 10.5.

 

Section 8.9   Merger or Consolidation of Trustee.  Any corporation or association into which the Trustee may be merged or converted or with which it may be consolidated or any corporation or association resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation or association succeeding to the business or substantially all of the assets of the Trustee, shall be the successor of the Trustee hereunder, provided such corporation or association shall be eligible under the provisions of Section 8.6, without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding.

 

Section 8.10   Appointment of Co-Trustee or Separate Trustee.  (a) Notwithstanding any other provisions hereof, at any time, for the purpose of meeting any legal requirements of any jurisdiction in which any part of the assets of the Trust for a given Series may at the time be located, the Depositor and the Trustee acting jointly shall have the power and shall execute and deliver all instruments to appoint one or more Persons approved by the Trustee to act as co-trustee or co-trustees, jointly with the Trustee, or separate trustee or separate trustees, of all or any part of such assets of the Trust, and to vest in such Person or Persons, in such capacity, such title to such assets of the Trust, or any part thereof, and, subject to the other provisions of this Section 8.10, such powers, duties, obligations, rights and trusts as the Depositor and the Trustee may consider necessary or desirable.  If the Depositor shall not have joined in such appointment within 15 days after the receipt by it of a request so to do, or in case an Administrative Agent Termination Event shall have occurred and be continuing, the Trustee alone shall have the power to make such appointment.  No co-trustee or separate trustee hereunder shall be required to meet the terms of eligibility as a successor trustee under Section 8.6 hereunder and no notice to Holders of Certificates of the appointment of co-trustee or co-trustees or separate trustee or trustees shall be required under Section 8.8 hereof.   Notwithstanding anything contained herein to the contrary, the appointment of a co-trustee pursuant to this Section 8.10 shall not release the Trustee from the duties, obligations, responsibilities or liabilities arising under this Agreement.

 

 

  

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(b)         In the case of any appointment of a co-trustee or separate trustee pursuant to this Section 8.10, all rights, powers, duties and obligations conferred or imposed upon the Trustee shall be conferred or imposed upon and exercised or performed by the Trustee and such separate trustee or co-trustee jointly, except to the extent that under any law of any jurisdiction in which any particular act or acts are to be performed by the Trustee, the Trustee shall be incompetent or unqualified to perform such act or acts, in which event such rights, powers, duties and obligations (including the holding of title to such assets of the Trust or any portion thereof in any such jurisdiction) shall be exercised and performed by such separate trustee or co-trustee at the direction of the Trustee.

 

(c)         Any notice, request or other writing given to the Trustee shall be deemed to have been given to each of the then separate trustees and co-trustees, as effectively as if given to each of them.  Every instrument appointing any separate trustee or co-trustee shall refer to this Agreement and the conditions of this Article VIII.  Each separate trustee and co-trustee, upon its acceptance of the trusts conferred, shall be vested with the estates or property specified in its instrument of appointment, either jointly with the Trustee or separately, as may be provided therein, subject to all the provisions of this Agreement, specifically including every provision of this Agreement relating to the conduct of, affecting the liability of, or affording protection to, the Trustee.  Every such instrument shall be filed with the Trustee.

 

(d)         Any separate trustee or co-trustee may, at any time, constitute the Trustee, its agent or attorney-in-fact, with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect of this Agreement on its behalf and in its name.  If any separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all its estates, properties, rights, remedies and trusts shall vest in and be exercised by the Trustee, to the extent permitted by law, without the appointment of a new or successor trustee.

 

Section 8.11   Appointment of Office or Agency.  As specified in a Series Supplement, the Trustee shall appoint an office or agency in the City of New York where the Certificates may be surrendered for registration of transfer or exchange, and presented for the final distribution with respect thereto, and where notices and demands to or upon the Trustee in respect of the Certificates of the related Series and this Agreement may be served.

 

Section 8.12   Representations and Warranties of Trustee.  The Trustee represents and warrants that:

 

(i)   the Trustee is duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation or association;

 

(ii)   neither the execution nor the delivery by the Trustee of this Agreement, nor the consummation by it of the transactions contemplated hereby nor compliance by it with any of the terms or provisions hereof will violate its charter documents or by-laws.

 

 

  

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(iii)   the Trustee has full power, authority and right to execute, deliver and perform its duties and obligations as set forth herein and in each Series Supplement to which it is a party and has taken all necessary action to authorize the execution, delivery and performance by it of this Agreement; and

 

(iv)   this Agreement has been duly executed and delivered by the Trustee and constitutes the legal, valid and binding obligation of the Trustee, enforceable in accordance with its terms, except as enforcement may be limited by the applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the rights of creditors generally and general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

 

Section 8.13   Trustee to Act Only in Accordance With This Agreement or Pursuant to Instructions of Certificateholders.  The Trustee shall only take such action or shall refrain from taking such action under this Agreement as directed pursuant to a specific provision of this Agreement or, if required hereunder, by all the Certificateholders, and the Trustee shall not otherwise act in respect of the Trust; provided, however, that the Trustee shall not be required to take any such action if it reasonably determines, or receives, at the expense of the Certificateholders, an Opinion of Counsel (with copies thereof delivered to the Certificateholders and the Depositor), that such action is inconsistent with the purpose of the Trust set forth in Section 2.7 or contrary to the terms hereof.

 

Section 8.14   Accounting and Reports to Certificateholders, Internal Revenue Service and Others.  The Trustee shall (a) maintain the books of the Trust on a calendar year basis on the accrual method of accounting, (b) after the close of each calendar year, deliver to each Certificateholder, as may be requested in writing by such Certificateholder and required by the Code and applicable Treasury Regulations or otherwise, such information for such year as may be required to enable such Certificateholder to prepare its federal income tax returns, (c) as specifically directed in writing by the Depositor, file such tax returns relating to the Trust and make such elections as may from time to time be required or appropriate under any applicable state or federal statute or rule or regulation thereunder so as to maintain the Trust’s characterization as other than an association taxable as a corporation for federal income tax purposes, (d) cause such tax returns to be signed in the manner required by law and (e) collect or cause to be collected any withholding tax as described in and in accordance with Subsection 4.4 with respect to income or distributions to Certificateholders.

 

Section 8.15   Signature on Returns.  Except as required by law, the Trustee shall sign on behalf of the Trust any and all tax returns of the Trust presented to it by the Depositor in final execution form.

 

 

 

  

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ARTICLE IX

 

TERMINATION

 

Section 9.1   Termination upon Purchase or Liquidation of All Underlying Securities.  (a) The respective obligations and responsibilities under this Agreement of the Depositor, the Administrative Agent, if any, and the Trustee (other than the obligations of any such Administrative Agent to provide for and the Trustee to make distributions to Holders of the Certificates of any given Series as hereafter set forth) shall terminate upon the distribution to such Holders of all amounts held in all the Accounts for such Series or by an Administrative Agent, if any, and required to be paid to such Holders pursuant to this Agreement on the Distribution Date coinciding with or following the earlier to occur of (i) if and as provided in the Series Supplement for such Series, the purchase by, and at the sole option of, the Administrative Agent, if any, as provided in the Series Supplement for such Series, of all remaining Underlying Securities for such Series held by the Trust for such Series on any Distribution Date, provided that such option may be exercised only if the aggregate principal amount of such Underlying Securities at the time of any such purchase is less than 10% (or such other percentage as may be specified in such Series Supplement) of the aggregate principal amount of all Underlying Securities held by such Trust as of the applicable Cut-off Date and (ii) the final payment on or other liquidation (which may include redemption or other purchase thereof by the applicable Underlying Securities Issuer) (or any Advance with respect thereto) of the last Underlying Security held by the Trust for such Series or the disposition of all property acquired upon foreclosure or liquidation of any such Underlying Security; provided, however, that in no event shall the trust created hereby continue beyond the expiration of 21 years from the death of the last survivor of the descendants of Joseph P. Kennedy, the late ambassador of the United States to the Court of St. James, living on the date hereof.

 

(b)          The Administrative Agent shall exercise its option to purchase all the Underlying Securities held by the Trust pursuant to clause (i) of Section 9.1(a) not later than 91 days prior to the anticipated date of purchase of all such Underlying Securities, at a price as may be specified in the applicable Series Supplement; provided, however, that such price shall not be less than the then outstanding aggregate principal amount of such Underlying Securities as determined on the date of purchase.  The proceeds of such purchase will be deposited into the Certificate Account and applied in the same manner and priority that collections on Underlying Securities would be applied as provided in the applicable Series Supplement.

 

(c)          Written notice of any termination shall be provided as set forth in Section 10.5.

 

(d)          Upon presentation and surrender of the Certificates by the Certificateholders on the Final Scheduled Distribution Date, or the Distribution Date coinciding with or next following the earlier to occur of the occurrences specified in clauses (i) and (ii) of Section 9.1(a), with respect to the applicable Series of Certificates, the Trustee shall distribute to each Holder presenting and surrendering its Certificates (i) the amount otherwise distributable on such Distribution Date in accordance with Section 4.1 in respect of the Certificates so presented and surrendered, if not in connection with the purchase by an Administrative Agent of all the Underlying Securities or (ii) as specified in the applicable Series Supplement, if in connection with an Administrative Agent’s purchase of all the remaining Underlying Securities.  Any funds not distributed on such Distribution Date shall be set aside and held in trust for the benefit of Certificateholders not presenting and surrendering their Certificates in the aforesaid manner, and shall be disposed of in accordance with this Section 9.1 and Section 4.1 hereof.  Immediately following the deposit of funds in trust hereunder, the Trust for such Series shall terminate.

 

 

  

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ARTICLE X

 

MISCELLANEOUS PROVISIONS

 

Section 10.1   Amendment.  (a) This Agreement may be amended from time to time by the Depositor and the Trustee without notice to or the consent of any of the Certificateholders for any of the following purposes:  (i) to cure any ambiguity or to correct or supplement any provision herein which may be defective or inconsistent with any other provision herein; (ii) to add or supplement any Credit Support for the benefit of any Certificateholders (provided that if any such addition affects any series or class of Certificateholders differently that any other series or class of Certificateholders, then such addition will not, as evidenced by an Opinion of Counsel, have a material adverse effect on the interests of any affected series or class of Certificateholders); (iii) to add to the covenants, restrictions or obligations of the Depositor, the Administrative Agent, if any, or the Trustee for the benefit of the Certificateholders; (iv) to add, change or eliminate any other provisions with respect to matters or questions arising under this Agreement, so long as (x) any such amendment described in (i) through (iv) will not, as evidenced by an Opinion of Counsel, cause the Trust (unless otherwise specified in a related Series Supplement) to fail to qualify as either a grantor trust or a partnership (other than a publicly traded partnership treated as a corporation) for U.S. federal income tax purposes or result in a sale or exchange of any Certificate for tax purposes and (y) the Trustee has received written confirmation from each Rating Agency rating such Certificates that such amendment will not cause such Rating Agency rating such Certificates to reduce or withdraw the then current rating thereof; (v) to comply with any requirements imposed by the Code; (vi) to evidence and provide for the acceptance of appointment hereunder of a Trustee, as Trustee for a Series of Certificates, and to add to or change any of the provisions of this Agreement as shall be necessary to provide for or facilitate the administration of the separate Trusts  hereunder by more than one Trustee, pursuant to the requirements of Section 5.1 hereof; (vii) to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Certificates of one or more Series or to add or change any of the provisions of this Agreement as shall be necessary to provide for or facilitate the administration of the trusts hereunder; or (viii) to provide for the issuance of a new Series of Certificates pursuant to a Series Supplement issued hereunder pursuant to Sections 5.1 and 5.13 hereof.

 

(b)         Without limiting the generality of the foregoing, with respect to any Series this Agreement may also be modified or amended from time to time by the Depositor and the Trustee with the consent of the Holders of Certificates representing the Required Percentage--Amendment of the aggregate Voting Rights of those Certificates to which such modification or amendment relates for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or of modifying in any manner the rights of the Holders of Certificates; provided, however, that no such amendment shall (i) reduce in any manner the amount of, or alter the timing of, payments received on Underlying Securities which are required to be distributed on any Certificate without the unanimous consent of the Holders of such Certificates, (ii) adversely affect in any material respect the interests of the Holders of any Series (or Class within such Series) of Certificates in a manner other than as described in (i), without the consent of the Holders of Certificates of such Series or Class evidencing not less than the Required Percentage--Amendment of the aggregate Voting Rights of such Series or Class or (iii) reduce the percentage of aggregate Voting Rights required by (ii), as described in (ii), without the consent of the Holders of all Certificates of such Series or Class then Outstanding; and provided further that the Depositor shall furnish to the Trustee an Opinion of Counsel (unless otherwise indicated in a related Series Supplement) stating that, in the opinion of such counsel, any such amendment would not affect the characterization of the Trust as either a a grantor trust or a partnership (other than a publicly traded partnership treated as a corporation) for U.S. federal income tax purposes. Notwithstanding any other provision of this Agreement, for purposes of the giving or withholding of consents pursuant to this Section 10.1, Certificates registered in the name of the Depositor, or any Affiliate thereof, shall be entitled to Voting Rights with respect to matters affecting such Certificates; and provided further that in the event the Rating Agency Condition is not satisfied with respect to such modification or amendment, the Required Percentage--Amendment shall be increased to require an aggregate percentage of the aggregate Voting Rights in the amount specified in the applicable Series Supplement. Notwithstanding any other provision of this Agreement, this Section 10.1(b) shall not be amended without the unanimous consent of the Holders of all such Certificates.

 

 

  

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(c)       Promptly after the execution of any such amendment or modification, the Trustee shall furnish a copy of such amendment or modification to each Certificateholder of the affected Series or Class and to the Rating Agency. It shall not be necessary for the consent of Certificate-holders under this Section to approve the particular form of any proposed amendment, but it shall be sufficient if such consent shall approve the substance thereof.  The manner of obtaining such consents and of evidencing the authorization of the execution thereof by Certificateholders shall be subject to such reasonable regulations as the Trustee may prescribe.

 

(d)       In executing any amendment, the Trustee shall receive (unless such amendment is consented to by all of the affected Certificateholders), and shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such amendment is authorized or permitted by this Agreement and that such amendment is the legal, valid and binding obligation of the Depositor, enforceable against the Depositor in accordance with its terms.  The Trustee may, but shall not be obligated to, enter into any such amendment which affects the Trustee's own rights, duties or immunities under this Agreement or otherwise.

 

Section 10.2   Counterparts.  This Agreement may be executed simultaneously in any number of counterparts, each of which counterparts shall be deemed to be an original, and such counterparts shall constitute but one and the same instrument.

 

Section 10.3   Limitation on Rights of Certificateholders.  (a) The death or incapacity of any Certificateholder shall not operate to terminate this Agreement or the Trust, nor entitle such Certificateholder’s legal representatives or heirs to claim an accounting or to take any action or proceeding in any court for a partition or winding up of the applicable Trust, nor otherwise affect the rights, obligations and liabilities of the parties hereto or any of then.

 

(b)          No Certificateholder of a given Series shall have any right to vote (except as expressly provided for herein) or in any manner otherwise control the operation and management of any Trust, or the obligations of the parties hereto, nor shall anything herein set forth, or contained in the terms of the Certificates, be construed so as to constitute the Certificateholders from time to time as partners or members of an association; nor shall any Certificateholder be under any liability to any third person by reason of any action taken by the parties to this Agreement pursuant to any provision hereof.

 

 

  

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(c)        No Certificateholder of a given Series shall have any right by virtue of any provision of this Agreement to institute any suit, action or proceeding in equity or at law upon or under or with respect to this Agreement, unless (i) such Holder previously shall have given to the Trustee a written notice of breach and of the continuance thereof and unless also the Holders of Certificates of such Series evidencing not less than the Required Percentage--Remedies of the aggregate Voting Rights of such Series shall have made written request upon the Trustee to institute such action, suit or proceeding in its own name as Trustee hereunder and shall have offered to the Trustee such reasonable indemnity as it may require against the costs, expenses and liabilities to be incurred therein or thereby, and the Trustee, for 15 days after its receipt of such notice, request and offer of indemnity, shall have neglected or refused to institute any such action, suit or proceeding. It is understood and agreed that the Trustee shall not be obligated to make any investigation of matters arising under this Agreement or to institute, conduct or defend any litigation hereunder or in relation hereto at the request, order or direction of any Certificateholders unless such Certificateholders have offered to the Trustee the reasonable indemnity referred to above.  It is further understood and agreed, and expressly covenanted by each Certificateholder of each Series with every other Certificateholder of such Series and the Trustee, that no one or more Holders of Certificates of such Series shall have any right in any manner whatever by virtue of any provision of this Agreement to affect, disturb or prejudice the rights of the Holders of any other of the Certificates of such Series, or to obtain or seek to obtain priority over or preference to any other such Holder, or to enforce any right under this Agreement, except in the manner herein provided and for the equal, ratable and common benefit of all Certificateholders of such Series.  For the protection and enforcement of the provisions of this Section, each and every Certificateholder and the Trustee shall be entitled to such relief as can be given either at law or in equity.

 

Section 10.4   Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of New York applicable to agreements made and to be performed entirely therein without reference to such State’s principles of conflicts of law to the extent that the application of the laws of another jurisdiction would be required thereby, and the obligations, rights and remedies of the parties hereunder shall be determined in accordance with such laws.  EACH OF THE DEPOSITOR AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE CERTIFICATES OR THE TRANSACTION CONTEMPLATED HEREBY.

 

Section 10.5   Notices.  All directions, demands and notices hereunder shall be in writing and shall be delivered as set forth in the applicable Series Supplement.  Any notice required to be provided to a Holder of a Certificate shall be given by first class mail, postage prepaid, at the last address of such Holder as shown in the Certificate Register.  Any notice so mailed within the time prescribed in this Agreement shall be conclusively presumed to have been duly given when mailed, whether or not the Certificateholder receives such notice.

 

 

  

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Section 10.6   Severability of Provisions.  If any one or more of the covenants, agreements, provisions or terms of this Agreement shall be for any reason whatsoever held invalid, then such covenants, agreements, provisions or terms shall be deemed severable from the remaining covenants, agreements, provisions or terms of this Agreement and shall in no way affect the validity or enforceability of the other provisions of this Agreement or of the Certificates or the rights of the Holders thereof.

 

Section 10.7   Notice to Rating Agency.  The Trustee shall use its best efforts promptly to provide notice to the Rating Agency with respect to each of the following of which it has actual knowledge:

 

(i)   any change or amendment to this Agreement;

 

(ii)   the occurrence of any Administrative Agent Termination Event;

 

(iii)   the resignation or termination of an Administrative Agent, if any, or the Trustee;

 

(iv)   the appointment of a successor Trustee;

 

(v)   the final payment to Holders of the Certificates of any Class;

 

(vi)   any change in the location of the Certificate Account; and

 

(vii)   any event that would result in the inability of the Trustee to make Advances.

 

In addition, the Trustee shall promptly furnish to each Rating Agency copies of each report to Certificateholders described in Section 4.2 and the Administrative Agent, if any, or otherwise the Trustee shall promptly furnish to each Rating Agency copies of the following:

 

(i)    each annual statement as to compliance described in Section 3.15; and

 

(ii)   each annual independent public accountants’ servicing report described in Section 3.1(c).

 

Any such notice pursuant to this Section shall be in writing and shall be deemed to have been duly given if personally delivered or mailed by first class mail, postage prepaid, or by express delivery service to each Rating Agency at the address specified in the applicable Series Supplement.

 

Section 10.8   Grant of Security Interest.  It is the express intent of the parties hereto that each conveyance of any Underlying Securities by the Depositor to the Trust be, and be construed as, a sale of the Underlying Securities by the Depositor and not a pledge of or grant of a security interest in any Underlying Securities by the Depositor to secure a debt or other obligation of the Depositor.  However, in the event that, notwithstanding the aforementioned intent of the parties, any Underlying Securities are held to be property of the Depositor, then, (a) it is the express intent of the parties that such conveyance constitute a grant of a security interest in such Underlying Securities by the Depositor to the Trust to secure the obligations of the Depositor under this Agreement and the applicable Series Supplement and (b)(1) this Agreement shall also be a security agreement within the meaning of Article 9 of the New York Uniform Commercial Code; (2) the Depositor hereby grants to the Trustee a security interest in all the Depositor’s right, title and interest, whether now owned or hereafter acquired, in and to such Underlying Securities and all proceeds thereof, to service the Depositor’s obligations under the Agreement and the applicable Series Supplement. The Depositor shall take such actions as may be necessary to ensure that, if this Agreement were deemed to create a security interest in the Underlying Securities, such security interest would be a perfected security interest of first priority under applicable law and will be maintained as such for so long as any of the Underlying Securities remain outstanding.  Without limiting the generality of the foregoing, the Depositor shall file, or shall cause to be filed, all filings identified by the Depositor to be necessary to maintain the perfection of the Trustee’s security interest in the Underlying Securities, including (x) continuation statements and (y) such other financing statements as may be occasioned by (1) any change of name of the Depositor or the Trustee, (2) any change of the type or jurisdiction of organization of the Depositor or (3) any transfer of any interest of the Depositor in any Underlying Security.

 

 

  

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Section 10.9   Nonpetition Covenant.  Notwithstanding any prior termination of this Agreement, each of the Trustee (including any Co-Trustee) the Administrative Agent, if any, (including any Sub-Administrative Agent, Authenticating Agent, Calculation Agent, or Paying Agent), the Depositor, each Certificateholder, and each Certificate Owner agrees that it shall not, until the date which is one year and one day after the earlier of a Trust Termination Event or the Final Scheduled Distribution Date, acquiesce, petition or otherwise invoke or cause the Trust to invoke the process of the United States of America, any State or other political subdivision thereof or any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government for the purpose of commencing or sustaining a case by or against the Trust under a Federal or state bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Trust or all or any part of the property or assets of the Trust or ordering the winding up or liquidation of the affairs of the Trust.  The provisions of this Section 10.9 shall survive any termination of the Trust and any termination of the Agreement for one year and one day.

 

Section 10.10   No Recourse.  Provided that there exists no default on the Underlying Securities, neither the Trustee (including any Co-Trustee), the Administrative Agent, if any (including any Sub-Administrative Agent, Authenticating Agent, Calculation Agent, or Paying Agent) nor the Depositor shall have any recourse to the Underlying Securities, except as specifically provided in the related Series Supplement.  The provisions of this Section 10.10 shall survive any termination of the Trust and any termination of the Agreement for one year and one day.

 

Section 10.11   Article and Section References.  All article and section references used in this Agreement, unless otherwise provided, are to articles and sections in this Agreement.

 

 

  

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Section 10.12    Conflict with Trust Indenture Act.

 

(a)          If any provision hereof limits, qualifies or conflicts with another provision hereof that is required to be included in this Agreement by any of the provisions of the TIA, such required provision shall control.

 

(b)             The provisions of TIA Sections 310 through 317 that impose duties on any Person (including the provisions automatically deemed included herein unless expressly excluded  by this Agreement) are a part of and govern this Agreement, whether or not physically contained herein.

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