Exhibit 4
INDEXPLUS TRUST CERTIFICATES SERIES 2003-1
SERIES SUPPLEMENT
between
MERRILL LYNCH DEPOSITOR, INC.,
as Depositor,
and
THE BANK OF NEW YORK,
as Trustee and Securities Intermediary
Dated as of December 17, 2003
Table of Contents
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Page
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Section 1. Incorporation of Standard Terms....................................1
Section 2. Definitions........................................................1
Section 3. Designation of Trust Certificates and Calculation Agent............6
Section 4. Satisfaction of Conditions to Initial Execution and Delivery of
Trust Certificates.............................................7
Section 5. Distributions......................................................7
Section 6. Trustee's Fees.....................................................9
Section 7. Optional Exchange.................................................10
Section 8. Miscellaneous.....................................................11
Section 9. Notices .......................................................12
Section 10. Governing Law....................................................13
Section 11. Counterparts.....................................................13
Section 12. Termination of the Trust.........................................13
Section 13. Sale or Redemption of any of the Underlying Securities...........13
Section 14. Amendments.......................................................14
Section 15. Voting of Underlying Securities, Modification of Indenture.......14
Section 16. Nonpetition Covenant.............................................15
Section 17. Amendments to Standard Terms.....................................15
SERIES SUPPLEMENT, dated as of December 17, 2003 (this
"Supplement"), by and between MERRILL LYNCH DEPOSITOR, INC., a Delaware
corporation, as Depositor, and THE BANK OF NEW YORK, a New York corporation, as
Trustee and Securities Intermediary.
W I T N E S S E T H:
WHEREAS, the Depositor desires to create the Trust designated
herein (the "Trust") by executing and delivering this Supplement, which shall
incorporate the terms of the Standard Terms for Trust Agreements, dated as of
February 20, 1998 (the "Standard Terms" and, together with this Supplement, the
"Trust Agreement"), by and between the Depositor and the Trustee and Securities
Intermediary, as modified by this Supplement;
WHEREAS, the Depositor desires to deposit the Underlying
Securities set forth on Schedule I attached hereto into the Trust;
WHEREAS, in connection with the creation of the Trust and the
deposit therein of the Underlying Securities, it is desired to provide for the
issuance of the Certificates evidencing undivided interests in the Trust;
WHEREAS, the Trustee has joined in the execution of the Standard
Terms and this Supplement to evidence the acceptance by the Trustee of the
Trust; and
WHEREAS, the Securities Intermediary has joined in the execution
of the Standard Terms and this Supplement to evidence the acceptance by the
Securities Intermediary of its obligations thereunder and hereunder;
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants expressed herein, it is hereby agreed by and between the
Depositor and the Trustee and Securities Intermediary as follows:
Section 1. Incorporation of Standard Terms. All of the provisions
of the Standard Terms, a copy of which is attached hereto as Exhibit A, are
hereby incorporated herein by reference in their entirety, and this Supplement
and the Standard Terms shall form a single agreement among the parties. In the
event of any inconsistency between the provisions of this Supplement and the
provisions of the Standard Terms, the provisions of this Supplement will control
with respect to the transactions described herein.
Section 2. Definitions. (a) Except as otherwise specified herein
or as the context may otherwise require, the following terms shall have the
respective meanings set forth below for all purposes under this Supplement
(Section 2(b) hereof sets forth terms listed in the Standard Terms that are not
applicable to this Series). Capitalized terms used but not defined herein shall
have the meanings assigned to them in the Standard Terms.
"Authorized Denomination": an aggregate stated amount of
Certificates that when exchanged for the Underlying Securities in
accordance with the terms of Section 7 will not cause the Trustee to be
required to deliver any fractional Underlying Securities.
"Available Funds": For any Distribution Date, the sum of all
amounts received on or with respect to the Underlying Securities.
"Business Day": Any day that is not a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust companies
in The City of New York are authorized or obligated by law, regulation
or executive order to close and that also is specified as a Business
Day with respect to the Underlying Securities.
"Calculation Agent": Merrill Lynch & Co.
"Certificate Principal Balance": On the Closing Date, $37,500,000;
and on any date thereafter, an amount equal to the initial Certificate
Principal Balance less any reductions in the principal amount of the
Underlying Securities. For purposes of calculating the Certificate
Principal Balance, the principal amount of any Underlying Securities
with respect to which a Removal Event has occurred shall be deemed to
be zero. The Certificate Principal Balance will be made available in
reports sent to Certificateholders upon any reduction thereof. The
Certificate Principal Balance for any individual Certificateholder will
be such Certificateholder's pro rata portion of the outstanding
Certificate Principal Balance.
"Certificates": The trust certificates issued by the Trust in a
stated amount of $25 per trust certificate, the holders of which are
entitled to receive (i) on each Interest Distribution Date,
distributions at a rate of 6.0518% per annum on the stated amount of
the Certificates as adjusted on the occurrence of any Pass-Through Rate
Adjustment Event, (ii) on each Scheduled Principal Distribution Date,
principal payments on the applicable Underlying Security, (iii) a cash
distribution of the principal amount of any remaining Underlying
Securities on the Final Scheduled Distribution Date, and (iv) such
other distributions as described herein.
"Closing Date": December 17, 2003.
"Collection Period": With respect to each Interest Distribution
Date except the first Interest Distribution Date, the period beginning
on the most recent Interest Distribution Date, inclusive, and ending on
the next Interest Distribution Date (not including that Interest
Distribution Date); and, with respect to the first Interest
Distribution Date, the period beginning on the Cut-off Date (including
the Cut-off Date) and ending on the next Interest Distribution Date
(not including that Interest Distribution Date), provided that this
clause shall be subject to Section 8(c) hereof.
"Corporate Trust Office": The office of the Trustee located at 100
Church Street, 8th Floor, New York, NY 10286, Attention: Corporate
Trust Department; provided, however, that the office at which
certificated securities are delivered for registration of transfer,
cancellation or exchange shall be the office of the Trustee, located at
100 Church Street, 8th Floor, New York, NY 10286.
"Credit Event": means the occurrence of any of the following (i) a
Payment Default with respect to an Underlying Security has occurred,
(ii) the initiation by an Underlying Securities Issuer of any
proceeding seeking a judgment of insolvency or
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bankruptcy or seeking relief under bankruptcy or insolvency laws or
similar laws affecting creditors' rights, (iii) the passage of thirty
calendar days since the day upon which any person or entity other than
an Underlying Securities Issuer initiates any proceedings against the
Underlying Security Issuer seeking a judgment of insolvency or
bankruptcy or seeking relief under bankruptcy or insolvency laws or
similar laws affecting creditor's rights and such proceedings have not
been dismissed prior to such thirtieth day, (iv) the maturity date of
an Underlying Security has been extended, or (v) the interest rate on
any Underlying Security has been reduced.
"Cut-off Date": December 17, 2003.
"Depository": The Depository Trust Company, its nominees and their
respective successors.
"Distribution Date": Any Interest Distribution Date, Scheduled
Principal Distribution Date or Underlying Securities Redemption
Distribution Date.
"Event of Default": An event of default under the terms of an
Underlying Security or an instrument governing an Underlying Security.
"Final Scheduled Distribution Date": May 15, 2033 (or, if such
date is not a Business Day, the next succeeding Business Day).
"Interest Distribution Date": Each June 20 and December 20
commencing from the Cut-off Date and ending on the Final Scheduled
Distribution Date and the maturity date of each Underlying Security.
"Market Agent": Merrill Lynch & Co.
"Optional Exchange Date": any six-month anniversary of the Closing
Date (as designated pursuant to Section 7 hereof).
"Ordinary Expenses": The compensation due to the Trustee for
Ordinary Expenses as defined in the Standard Terms, which, with respect
to Ordinary Expenses other than those referred to in clause (iii) of
such definition and other than the costs of converting to EDGAR format
the periodic reports required for the Trust under the Exchange Act,
shall be as set forth in a separate agreement between the Trustee and
the Depositor.
"Pass-Through Rate": The per annum interest rate on the trust
certificates applicable during the interest accrual period related to
an Interest Distribution Date. The Pass-Through Rate will initially be
equal to 6.0% (except for the distribution on [June 20, 2004] which
will be made at a pass-through rate of [ ]%), until a Pass-Through Rate
Adjustment Event has occurred, in which case the Pass-Through Rate
shall be recalculated by the Calculation Agent so that the adjusted
Pass-Through Rate will be equal to:
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(i) the aggregate principal amount of the Underlying
Securities after giving effect to any distribution of principal
resulting from such Pass-Through Rate Adjustment Event multiplied
by the weighted average interest rate of the Underlying Securities
after giving effect to any distribution of principal resulting
from such Pass-Through Rate Adjustment Event, divided by
(ii) the Certificate Principal Balance after giving effect to
the distribution of principal resulting from such Pass-Through
Rate Adjustment Event.
"Pass-Through Rate Adjustment Event": (i) A reduction of the
aggregate principal amount of the Underlying Securities resulting from
the occurrence of a Scheduled Principal Distribution Date, a redemption
of Underlying Securities by the related Underlying Securities Issuer or
a sale on distribution of Underlying Securities after the occurrence of
a Removal Event, or (ii) the incurrence by the Trust of Extraordinary
Trust Expenses.
"Payment Default": (i) A default by an Underlying Securities
Issuer in the payment of any amount due on the applicable Underlying
Security after the same becomes due and payable and any applicable
grace period set forth in the indenture related to such Underlying
Security has expired, or (ii) the acceleration of the maturity of the
Underlying Securities pursuant to the terms of the Underlying
Securities or the instrument governing the Underlying Securities and
the failure to pay 100% of the accelerated amount on the date of
accelerated maturity.
"Prepaid Ordinary Expenses": Zero (0).
"Prospectus Supplement": The Prospectus Supplement dated December
11, 2003 relating to the Certificates.
"Rating Agency": Moody's and Fitch.
"Record Date": The Business Day immediately preceding each
Distribution Date.
"Removal Event": With respect to any Underlying Security, (i) any
Underlying Securities Issuer of such Underlying Securities representing
10% or more of the aggregate principal amount of all Underlying
Securities ceases to file periodic reports with the Securities and
Exchange Commission under the Exchange Act or (ii) the occurrence of a
Credit Event with respect to such Underlying Security or its Underlying
Securities Issuer.
"Sale Instruction": has the meaning set forth in Section 5(d).
"Scheduled Principal Distribution": With respect to any Scheduled
Principal Distribution Date, the amount of principal due to the Trustee
as holder of the related Underlying Security.
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"Scheduled Principal Distribution Date": The maturity date of an
Underlying Security and the Final Scheduled Distribution Date.
"Series": INDEXPLUS Trust Certificates Series 2003-1.
"Underlying Securities": The securities issued by each Underlying
Securities Issuer, as described in Schedule I hereto.
"Underlying Securities Indenture": As set forth in Schedule I.
"Underlying Securities Issuer": As set forth in Schedule I.
"Underlying Securities Redemption Distribution Date": the date on
which the Trustee receives payment for either a redemption of an
Underlying Security in accordance with its terms or a sale of
securities pursuant to Section 5(c), provided, however, that if the
Trustee receives such payment after 10:00 A.M. (Eastern Standard Time)
on such date, the Underlying Securities Redemption Distribution Date
shall be on the next succeeding Business Day.
(b) The terms listed below are not applicable to this Series.
"Accounting Date"
"Administration Account"
"Administration Agreement"
"Administrative Agent"
"Administrative Agent Termination Event"
"Advance"
"Call Price"
"Call Right"
"Call Terms"
"Callable Series"
"Credit Support"
"Credit Support Instrument"
"Credit Support Provider"
"Eligible Account"
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"Eligible Expense"
"Eligible Investments"
"Exchange Rate Agent"
"Floating Pass-Through Rate"
"Letter of Credit"
"Limited Guarantor"
"Limited Guaranty"
"Notional Amount"
"Reserve Account"
"Requisite Reserve Amount"
"Sale Procedures"
"Retained Interest"
"Surety Bond"
"Swap Agreement"
"Swap Counterparty"
"Swap Distribution Amount"
"Swap Guarantee"
"Swap Guarantor"
"Swap Receipt Amount"
"Swap Termination Payment"
Section 3. Designation of Trust Certificates and Calculation
Agent. (a) The Trust created hereby shall be known as the "INDEXPLUS Trust
Series 2003-1." The Certificates evidencing certain undivided ownership
interests therein shall be known as the "INDEXPLUS Trust Certificates Series
2003-1."
(b) Merrill Lynch & Co. is hereby appointed as Calculation Agent.
The Calculation Agent shall be responsible for the recalculation of the
Pass-Through Rate and the Certificate Principal Balance upon notification from
the Trustee that a Pass-Through Rate Adjustment Event has occurred. The
Calculation Agent shall notify the Trustee in writing of the
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amount of any recalculated Certificate Principal Balance and Pass-Through Rate
within five days after receipt of such notice but no later than two Business Day
prior to the next Distribution Date.
(c) The Trustee shall notify Certificateholders and the Rating
Agency in writing of the amount of any recalculated Certificate Principal
Balance and Pass-Through Rate within two days of receiving notice from the
Calculation Agent in accordance with paragraph (b) above.
(d) The Certificates shall be held through the Depository in
book-entry form and shall be substantially in the form attached hereto as
Exhibit B. The Certificates shall be issued in authorized denominations of $25
and integral multiples thereof. Except as provided in the Standard Terms, the
Trust shall not issue additional Certificates or incur any indebtedness;
provided, however, that, from time to time, upon obtaining prior written
confirmation by each Rating Agency that such action will not result in a
downgrading or withdrawal of its rating of the Certificates, the Depositor may,
without the consent of the Certificateholders, increase the number and amount of
the Underlying Securities in the Trust and the Trust may issue a corresponding
number of additional Certificates in accordance with Section 5.12(a) of the
Standard Terms (except that clauses (vi) and (vii) of Section 5.12(a) shall not
apply to this Series).
(e) Any reference to the principal amount of the Certificates
shall be construed as a reference to the stated amount of the Certificates,
unless otherwise indicated.
Section 4. Satisfaction of Conditions to Initial Execution and
Delivery of Trust Certificates. The Trustee hereby acknowledges receipt, on or
prior to the Closing Date, of:
(i) the Underlying Securities set forth on Schedule I hereto; and
(ii) all documents set forth in Section 5.12(a) of the Standard
Terms except that clauses (vi) and (vii) of Section 5.12(a)
shall not apply to this Series.
Section 5. Distributions. (a) On each Interest Distribution Date,
the Trustee shall apply the funds in the Certificate Account, solely to the
extent of Available Funds in the Certificate Account, as follows:
(i) first, to the Trustee, reimbursement for any approved
Extraordinary Trust Expenses incurred by the Trustee in accordance with
Section 6(b) hereof and approved by not less than 100% of the
Certificateholders;
(ii) second, subject to Section 7(a), pro rata to the
Certificateholders, on each Interest Distribution Date and the Final
Scheduled Distribution Date (or if the Trustee receives payment after
10:00 A.M. (Eastern Standard Time) on that date, the next Business Day)
only, all payments of interest in respect of scheduled payments on the
underlying securities which are not redemption or sales proceeds
subject to Section 13(b) hereof, received by the Trust during the
Collection Period;
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(iii) third, pro rata to the Certificateholders, if available, any
additional payments paid by any of the Underlying Securities Issuers as
a result of a delay in the receipt by the Trustee of any payment on the
applicable Underlying Securities;
(iv) fourth, pro rata to the Certificateholders, on each Scheduled
Principal Distribution Date (or if the Trustee receives payment after
10:00 A.M. (Eastern Standard Time) on that date, the next Business Day)
only, a distribution of the Scheduled Principal Distribution, to the
extent received by the Trust on the applicable Underlying Security or
amounts paid on the Treasury Securities, in reduction of the
Certificate Principal Balance;
(v) fifth, pro rata to the Certificateholders, on the Final
Scheduled Distribution Date (or if the Trustee receives payment after
10:00 A.M. (Eastern Standard Time) on that date, the next Business Day)
only, a distribution of the remaining aggregate principal amount of any
remaining Underlying Securities to the extent received by the Trust;
(vi) sixth, to the extent there remain Available Funds in the
Certificate Account, to any creditors of the Trust in satisfaction of
liabilities thereto; and
(vii) seventh, to the extent there remain Available Funds in the
Certificate Account, to Merrill Lynch Capital Services, Inc., and if no
Available Funds remain in the Certificate Account, then no distribution
will be made pursuant to this Section 5(a)(vii).
Subject to Section 8(c) hereof, to the extent Available Funds are insufficient
to make any required distributions due to the Certificates on any Distribution
Date, any shortfall will be carried over and will be distributed on the next
Distribution Date on which sufficient funds are available on the Available Funds
to pay such shortfall. Neither Merrill Lynch & Co. nor any of its Affiliates
will have any claim against the Trust pursuant to Section 5(a)(vii) if the Trust
fails to make a distribution on a Distribution Date to such person because no
Available Funds remain in the Certificate Account on such Distribution Date.
(b) On each Interest Distribution Date, commencing on June 20,
2004 and ending on the Final Scheduled Distribution Date, the Certificateholders
will be entitled to receive pursuant to Section 5(a)(ii) distributions of
interest payments received by the trust in respect of scheduled payments on the
Underlying Securities, which are not redemption or sale proceeds subject to
Section 13(b) hereof, that will initially be at a rate of 6.0518% per annum, as
adjusted by the occurrence of a Pass-Through Rate Adjustment Event, on the
stated amount of the Certificates. Any amounts received by the Trustee during a
Collection Period in respect of interest on any of the Underlying Securities
shall be held by the Trustee in a non-interest bearing account with the Trustee
until the next succeeding Interest Distribution Date.
(c) On an Optional Exchange Date, the Trustee shall distribute to
Merrill Lynch & Co. or any of its Affiliates, other than the Depositor, or any
other Person exercising an optional exchange pursuant to Section 7 hereof, as
the case may be, any applicable Underlying Securities in accordance with Section
7 hereof.
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(d) If a Removal Event occurs, then the Trustee, within two
Business Days following the receipt of written notice from the applicable
Underlying Security indenture trustee or the Depositor, or its actual knowledge,
of such Removal Event, will deliver to the Certificateholders, the Rating
Agencies and the Depositor notice of such Removal Event and deliver written
instructions ("Sale Instructions") to the Market Agent to sell the applicable
Underlying Security on behalf of the Trust on or after the 30th day but in no
event later than the 45th day after the date on which the Trustee receives
notice of this occurrence of the Removal Event. Upon receipt of such Sale
Instructions, the Market Agent shall use its reasonable efforts to sell the
applicable Underlying Securities and deliver the proceeds received in connection
with such sale to the Trustee for distribution to Certificateholders in
accordance with each Certificateholder's Certificate Principal Balance. After
completion of such sale, the Trustee shall notify the Certificateholders, Rating
Agencies and the Depositor.
(e) In connection with the sale of any Underlying Securities
required by Section 5(d), the Market Agent will use its reasonable efforts to
sell such Underlying Securities to the highest of not fewer than four solicited
bidders (which bidders may include the Market Agent or any of its Affiliates);
provided, however, that neither the Market Agent nor any of its Affiliates is
obligated to bid for those Underlying Securities; and provided further that the
Market Agent will use its reasonable efforts to solicit at least four bids from
financial institutions with invested assets or assets under management of at
least $50 million that are not Affiliates of the Market Agent. If, after the
Market Agent determines, in its sole discretion, a sufficient period has elapsed
and the Market Agent receives fewer than four bids for all or less than all of
such Underlying Securities, the Calculation Agent will sell the Underlying
Securities for which bids have been received to the highest bidder of the bids
received. In the sole judgment of the Calculation Agent, bids may be evaluated
on the basis of bids for all or a portion of the Underlying Securities to be
sold or any other basis selected in good faith by the Calculation Agent. The
proceeds of such sale will be distributed, pro rata, in accordance with each
Certificateholder's Certificate Principal Balance by the Trustee on the date of
receipt (or if the Trustee receives payments after 10:00 A.M. (Eastern Standard
Time) on that date, the next Business Day). Any payments made on any Underlying
Security with respect to which a Removal Event has occurred but prior to its
sale pursuant to Section 5(d) and 5(e) shall be distributed, pro rata, in
accordance with each Certificateholder's Certificate Principal Balance and the
Trustee shall instruct the Market Agent to sell sufficient Underlying Securities
to pay any fractional amounts in cash.
Section 6. Trustee's Fees. (a) Payment to the Trustee of Ordinary
Expenses shall be as set forth in a separate agreement between the Trustee and
the Depositor. The Trustee agrees that in the event Ordinary Expenses are not
paid in accordance with such agreement, it shall (i) not have any claim or
recourse against the Trust or the property of the Trust with respect thereto and
(ii) continue to perform all of its services as set forth herein unless it
elects to resign as Trustee in accordance with Section 7.08 of the Standard
Terms.
(b) The Trustee shall not be obligated to incur any Extraordinary
Trust Expenses unless (i) the Trustee is satisfied that it will have adequate
security or indemnity in respect of such costs, expenses and liabilities, and
(ii) all the Certificateholders of Certificates then outstanding have voted to
require the Trustee to incur such Extraordinary Trust Expenses. If Extraordinary
Trust Expenses are not approved unanimously as set forth in clause (ii) of this
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paragraph, such Extraordinary Trust Expenses shall not be an obligation of the
Trust, and the Trustee shall not file any claim against the Trust therefor,
notwithstanding failure of Certificateholders to reimburse the Trustee, and
Extraordinary Trust Expenses shall not be paid out of the Deposited Assets.
Section 7. Optional Exchange. (a) Merrill Lynch & Co. or any of
its Affiliates (other than the Depositor), if it holds Certificates, may notify
the Trustee in writing not less than 30 days but not more than 60 days prior to
any Optional Exchange Date, that:
(i) such Person intends or Affiliated Persons intend to tender an
Authorized Denomination of Certificates that it holds or they hold to
the Trustee on such Optional Exchange Date in exchange for a
proportional amount of Underlying Securities;
(ii) such exchange will not cause the Trust or Depositor to fail
to satisfy the applicable requirements for exemption under Rule 3a-7
under the Investment Company Act of 1940, as amended;
(iii) such exchange will not affect the characterization of the
Trust as a "grantor trust" under the Code; and
(iv) in the case of an exchange of less than all outstanding
Certificates, such exchange will not cause a failure to satisfy the
minimum requirements for the Certificates to remain listed on the New
York Stock Exchange, unless the Person or Affiliated Persons tendering
such Certificates will hold all remaining outstanding Certificates upon
completion of the exchange of such Certificates pursuant to this
Section 7.
Upon tender of such Certificates on such Optional Exchange Date, the Trustee
will deliver to the Person or Affiliated Persons tendering such Certificates (a)
an amount of each of the Underlying Securities having a principal amount or,
where any Underlying Securities are interest-only Treasury STRIPS, a notional
amount, equal to the aggregate principal amount of such Underlying Securities
or, where any Underlying Securities are interest-only Treasury STRIPS, the
aggregate notional amount, then held by the Trust multiplied by the result of
dividing the aggregate stated amount of Certificates being tendered by the
aggregate stated amount of Certificates then outstanding, and (b) a portion of
any payments received by the Trustee prior to such Optional Exchange Date in
respect of the Underlying Securities and held in a non-interest bearing account
pursuant to Section 5(b) pending distribution to Holders pursuant to Section
5(c) that is equal to the total amount of payments so held by the Trustee
multiplied by the result of dividing the aggregate stated amount of Certificates
being tendered by the aggregate stated amount of Certificates then outstanding;
provided, that in no case shall the Trustee be required to deliver pursuant to
this section a fractional amount of any Underlying Security.
(b) The requirements set forth in paragraphs (a)(ii), (a)(v) and
(a)(vi) of Section 4.07 of the Standard Terms do not apply to an Optional
Exchange pursuant to this Section 7.
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(c) Any costs associated with the exercise of the rights granted
under paragraph (a) of this Section 7 will be borne by the Person or Affiliated
Persons exercising such rights and not by the Trust.
(d) The Trustee will be entitled to receive an Opinion of Counsel
that the conditions in clauses (a)(ii), (iii) and (iv) of this Section 7 are
satisfied.
Section 8. Miscellaneous. (a) The provisions of Section 4.04,
Advances, of the Standard Terms shall not apply to the Certificates.
(b) The Certificateholders shall not be entitled to terminate the
Trust or cause the sale or other disposition of any of the Underlying
Securities; provided, however, that Certificateholders holding all, but not less
than all, of the outstanding Certificates may exercise their rights under
Section 12(b) with respect to all such Certificates.
(c) If the Trustee has not received payment with respect to any
Underlying Securities on or prior to the related Distribution Date, such
distribution will be made promptly upon receipt of such payment. No additional
amounts shall accrue on the Certificates or be owed to Certificateholders as a
result of such delay; provided, however, that any additional interest owed and
paid by the applicable Underlying Securities Issuer as a result of such delay
shall be paid to the Certificateholders, in proportion to their respective
entitlements to interest payments.
(d) The outstanding principal balance of the Certificates shall
not be reduced by the amount of any Realized Loss.
(e) The Trust may not engage in any business or activities other
than in connection with, or relating to, the holding, protecting and preserving
of the Deposited Assets and the issuance of the Certificates, and other than
those required or authorized by the Trust Agreement or incidental and necessary
to accomplish such activities. The Trust may not issue or sell any certificates
or other obligations other than the Certificates or otherwise incur, assume or
guarantee any indebtedness for money borrowed.
(f) The Trust may not consolidate, amalgamate, merge with or into,
or be replaced by or convey, transfer or lease its properties and assets
substantially as an entirety to, any another entity or permit any other entity
to consolidate, amalgamate, merge with or into, or replace the Trust.
(g) Except as expressly provided in the Trust Agreement, the Trust
may not sell any of the Underlying Securities.
(h) If the Trustee resigns or is removed as Trustee in accordance
with Section 7.08 of the Trust Agreement, in addition to providing the Depositor
with written notice, the Trustee shall also provide the Rating Agencies with
written notice.
(i) Merrill Lynch & Co. shall act as the Market Agent and shall
serve in such capacity in accordance with the terms of the Market Agent
Agreement attached hereto as Exhibit C.
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(j) Notwithstanding anything in the Trust Agreement to the
contrary, the Trustee may be removed upon 60 days prior written notice delivered
by Certificateholders holding Certificates that represent the Required
Percentage-Removal of Trustee, and such removal shall take effect upon the
appointment of a successor Trustee and its acceptance of such appointment as
provided in the Trust Agreement.
Section 9. Notices. (a) All directions, demands and notices
hereunder or under the Standard Terms shall be in writing and shall be delivered
as set forth below (unless written notice is otherwise provided to the Trustee).
If to the Depositor, to:
Merrill Lynch Depositor, Inc.
c/o Merrill Lynch & Co.
World Financial Center
New York, NY 10281
Attention: Barry N. Finkelstein
Telephone: (212) 449-9001
Facsimile: (212) 449-9054
If to the Trustee, to:
The Bank of New York
100 Church Street
8th Floor
New York, NY 10286
Attention: INDEXPLUS Trust Series 2003-1
Telephone: (212) 437-4055
Facsimile: (212) 437-6151
If to the Securities Intermediary, to:
The Bank of New York
100 Church Street
8th Floor
New York, NY 10286
Attention: INDEXPLUS Trust Series 2003-1
Telephone: (212) 437-4055
Facsimile: (212) 437-6151
If to the Rating Agencies, to:
Moody's Investors Service, Inc.
99 Church Street
New York, New York 10007
Attention: CDO/CLO Monitoring Department
Telephone: cdomonitoring@moody's.com
Facsimile: (212) 553-0355
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and to:
Fitch Ratings
One State Street Plaza
New York, NY 10004
Attention: [ ]
Telephone: (212) ________
Facsimile: (212) ________
Section 10. Governing Law. This Supplement and the transactions
described herein shall be construed in accordance with and governed by the law
of the State of New York.
Section 11. Counterparts. This Supplement may be executed in any
number of counterparts, each of which shall be deemed to be an original, and all
such counterparts shall constitute but one and the same instrument.
Section 12. Termination of the Trust. (a) The Trust shall
terminate upon the earlier of (i) the payment in full at maturity or sale by the
Trust after a Removal Event on the last remaining Underlying Securities and the
distribution in full of all amounts due to the Certificateholders, (ii) the
exchange of all outstanding Certificates for all of the Underlying Securities
pursuant to one or more Optional Exchanges and (iii) the election by
Certificateholders who hold all, but not less than all, of the outstanding
Certificates to terminate the trust pursuant to Section 12(b) below.
(b) Certificateholders who hold all, but not less than all, of the
outstanding Certificates may, upon prior written notice to the Rating Agencies,
elect to terminate the Trust at any time; provided that (based on an Opinion of
Counsel) the exercise of such termination right would not cause the Trust or the
Depositor to fail to satisfy the applicable requirements for exemption under
Rule 3a-7 under the Investment Company Act of 1940, as amended.
(c) To the extent that the provisions of this Section 12 conflict
with Section 10.01 of the Standard Terms, the latter shall control.
Section 13. Sale or Redemption of any of the Underlying
Securities. (a) In the case of Extraordinary Trust Expenses approved by 100% of
the Certificateholders, pursuant to Section 6(b) hereof, the Trustee, upon prior
written notice to the Rating Agencies, shall sell all or a portion of any of the
Underlying Securities to pay such Extraordinary Trust Expenses.
(b) Upon receipt by the Trustee of a notice that all or a portion
of an Underlying Security is to be redeemed, the Trustee shall deliver notice of
such redemption to the registered Certificateholders not less than fifteen (15)
days prior to the Underlying Securities Redemption Distribution Date by mail to
each registered Certificateholder at such registered Certificateholder's last
address on the register maintained by the Trustee; provided, however, that the
Trustee shall not be required to give any notice of redemption prior to the
third Business Day after the date it receives notice of such redemption. The
proceeds of any redemption of Underlying Securities will be allocated and
distributed by the Trustee on the Underlying Securities Redemption Distribution
Date to the Certificateholders pro rata, in accordance with their respective
Certificate Principal Balances as soon as practicable after the Trustee receives
13
such proceeds. The Certificate Principal Balance of the Certificates will be
reduced in amount equal to the reduction in the principal amount of the
Underlying Securities subject to redemption.
Section 14. Amendments. Notwithstanding anything in the Trust
Agreement to the contrary, in addition to the other restrictions on modification
and amendment contained herein, the Trustee shall not enter into any amendment
or modification of the Trust Agreement that would adversely affect in any
material respect the interests of the Certificateholders without the consent of
100% of such Certificateholders; provided, however, that no such amendment or
modification will be permitted if the Trustee has been advised by the Depositor
that such amendment or modification would alter the status of the Trust as a
"grantor trust" for federal income tax purposes. Further, no amendment shall be
permitted pursuant to paragraphs (vi), (vii) and (x) of Section 11.01(a) of the
Standard Terms without prior written confirmation by each Rating Agency that
such amendment will not result in a downgrading or withdrawal of its rating of
the Certificates. The Trustee may consult with counsel and shall be entitled to
rely upon an Opinion of Counsel for purposes of determining compliance with the
provisions of this Section 14.
Section 15. Voting of Underlying Securities, Modification of
Indenture. The Trustee, as holder of the Underlying Securities, has the right to
vote and give consents and waivers in respect of the Underlying Securities as
permitted by the Depository and except as otherwise limited by the Trust
Agreement. In the event that the Trustee receives a request from the Depository,
an Underlying Securities trustee or an Underlying Securities Issuer for its
consent to any amendment, modification or waiver of the applicable Underlying
Securities, the applicable Underlying Securities Indenture or any other document
thereunder or relating thereto, or receives any other solicitation for any
action with respect to such Underlying Securities, the Trustee shall mail a
notice of such proposed amendment, modification, waiver or solicitation to each
Certificateholder of record as of such date. The Trustee shall request
instructions from the Certificateholders as to whether or not to consent to or
vote to accept such amendment, modification, waiver or solicitation. The Trustee
shall consent or vote, or refrain from consenting or voting, in the same
proportion (based on the relative outstanding principal balances of the
Certificates) as indicated by the Certificateholders thereof as of a date
determined by the Trustee prior to the date on which such consent or vote is
required; provided, however, that, notwithstanding anything in the Trust
Agreement to the contrary, the Trustee shall at no time vote on or consent to
any matter (i) unless such vote or consent would not (based on an Opinion of
Counsel) alter the status of the Trust as a "grantor trust" for federal income
tax purposes or result in the imposition of tax upon the Certificateholders, or
(ii) that would alter the timing or amount of any payment on any of the
Underlying Securities, including, without limitation, any demand to accelerate
such Underlying Securities, except in the Event of a Default of any such
Underlying Securities or an event that with the passage of time would become an
Event of Default of any such Underlying Securities and with the consent of 100%
of the Certificateholders, or (iii) that would result in the exchange or
substitution of any of the outstanding Underlying Securities pursuant to a plan
for the refunding or refinancing of such Underlying Securities except in an
Event of Default and only with the consent of 100% of the Certificateholders.
The Trustee shall have no liability for any failure to act resulting from
Certificateholders' late return of, or failure to return, directions requested
by the Trustee from the Certificateholders.
14
If an offer is made by an Underlying Securities Issuer to issue
new obligations in exchange and substitution for any of the Underlying
Securities, pursuant to a plan for the refunding or refinancing of such
outstanding Underlying Securities or any other offer is made for any of the
Underlying Securities, the Trustee shall notify the Certificateholders and the
Rating Agencies of such offer promptly. The Trustee must reject any such offer
unless the Trustee is directed by the affirmative vote of 100% of the
Certificateholders to accept such offer and an Event of Default has occurred,
the Trustee has received the tax opinion described above and if the Trustee is
so directed, the Trustee shall promptly notify the Rating Agencies of such
direction accompanied by evidence of the affirmative vote of such
Certificateholders.
If an Event of Default occurs and is continuing, and if directed
by 100% of the Certificateholders, the Trustee shall vote such Underlying
Securities in favor of directing, or take such other action as may be
appropriate to direct, the applicable Underlying Securities trustee to declare
the unpaid principal amount of such Underlying Securities and any accrued and
unpaid interest thereon to be due and payable.
Section 16. Nonpetition Covenant. Solely with respect to the Trust
and the Series and for no other purpose, Section 11.07 of the Standard Terms is
hereby deleted and replaced with the following:
Section 11.07. Nonpetition Covenant. Notwithstanding any prior
termination of this Trust Agreement, each of the Trustee (including any
Authenticating Agent and Paying Agent) and the Depositor agrees that it
shall not, until the date which is one year and one day after the
termination of the INDEXPLUS Trust Series 2003-1, acquiesce, petition
or otherwise invoke or cause the Trust to invoke the process of the
United States, any State or other political subdivision thereof or any
entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government for the purpose
of commencing or sustaining a case by or against the Trust under a
Federal or state bankruptcy, insolvency or similar law or appointing a
receiver, liquidator, assignee, trustee, custodian, sequestrator or
other similar official of such Trust or all or any part of the property
or assets of such Trust or ordering the winding up or liquidation of
the affairs of such Trust.
Section 17. Amendments to Standard Terms. Solely with respect to
the Trust and the Series and for no other purpose, the Standard Terms are hereby
amended as follows:
(a) Clause (iii) of Subsection (c) of Section 2.01 of the Standard
Terms shall be deleted and replaced with the following:
"at the time of delivery of the Underlying Securities, Depositor
owns such Underlying Securities, has the right to transfer its
interest in such Underlying Securities and such Underlying
Securities are free and clear of any lien, pledge, encumbrance,
right, charge, claim or other security interest (other than the
lien created by this Trust Agreement); and"
(b) Subsection (e) of Section 2.01 of the Standard Terms shall be
deleted and replaced with the following:
15
"Any Trust created hereunder shall not engage in any business or
activities other than in connection with, or relating to, the
holding, protecting and preserving of the Deposited Assets and the
issuance of the Certificates and other than those required or
authorized by this Trust Agreement or incidental to and necessary
to accomplish such activities. Any Trust created hereunder shall
not issue or sell any certificates or other obligations other than
the Certificates or otherwise incur, assume or guarantee any
indebtedness for money borrowed."
(c) Section 3.04 shall be deleted and replaced with the following:
"This subsection has been left intentionally blank."
(d) Section 3.05 shall be deleted and replaced with the following:
"This subsection has been left intentionally blank."
(e) Section 3.06 shall be deleted and replaced with the following:
"This subsection has been left intentionally blank."
(f) Section 3.07 shall be deleted and replaced with the following:
"This subsection has been left intentionally blank."
(g) Section 4.08 shall be deleted and replaced with the following:
"This subsection has been left intentionally blank."
16
IN WITNESS WHEREOF, the parties hereto have caused this Supplement
to be duly executed by their respective authorized officers as of the date first
written above.
MERRILL LYNCH DEPOSITOR, INC.,
as Depositor
By:
----------------------------------------
Name: Barry N. Finkelstein
Title: President
THE BANK OF NEW YORK,
not in its individual capacity but as
Trustee
By:
----------------------------------------
Name: Fernando Acebedo
Title: Authorized Signatory
THE BANK OF NEW YORK,
as Securities Intermediary
By:
----------------------------------------
Name: Fernando Acebedo
Title: Authorized Signatory
SCHEDULE I
INDEXPLUS TRUST CERTIFICATES, SERIES 2003-1
UNDERLYING SECURITIES SCHEDULE
The underlying securities deposited into the trust are set forth
below.
- ------------------------------------------------------------------------------------------------------------
Coupon
Name of Issuer Rate Maturity Date Principal CUSIP
- ------------------------------------------------------------------------------------------------------------
1 The Boeing Company 6.125% February 15, 2033 $2,213,000 097023AU9
- ------------------------------------------------------------------------------------------------------------
2 Citigroup Inc. 5.875% February 22, 2033 $2,213,000 172967BU4
- ------------------------------------------------------------------------------------------------------------
3 Credit Suisse First Boston (USA), 7.125% July 15, 2032 $2,213,000 22541LAE3
Inc.
- ------------------------------------------------------------------------------------------------------------
4 DaimlerChrysler North America 8.500% January 18, 2031 $2,213,000 233835AQ0
Holding Corporation
- ------------------------------------------------------------------------------------------------------------
5 Ford Motor Company 7.450% July 16, 2031 $2,213,000 345370CA6
- ------------------------------------------------------------------------------------------------------------
6 General Electric Capital Corporation 6.750% March 15, 2032 $2,213,000 36962GXZ2
- ------------------------------------------------------------------------------------------------------------
7 General Motors Acceptance Corporation 8.000% November 1, 2031 $2,213,000 370425RZ5
- ------------------------------------------------------------------------------------------------------------
8 The Goldman Sachs Group, Inc. 6.125% February 15, 2033 $2,213,000 38141GCU6
- ------------------------------------------------------------------------------------------------------------
9 Johnson & Johnson 4.950% May 15, 2033 $2,213,000 478160AL8
- ------------------------------------------------------------------------------------------------------------
10 The May Department Stores Company 6.900% January 15, 2032 $2,213,000 577778BQ5
(New York)
- ------------------------------------------------------------------------------------------------------------
11 Time Warner Inc. 6.625% May 15, 2029 $2,213,000 887315BN8
- ------------------------------------------------------------------------------------------------------------
12 Valero Energy Corporation 7.500% April 15, 2032 $2,213,000 91913YAE0
- ------------------------------------------------------------------------------------------------------------
13 Verizon Global Funding Corp. 7.750% June 15, 2032 $2,213,000 92344GAS7
- ------------------------------------------------------------------------------------------------------------
14 Viacom Inc. 5.500% May 15, 2033 $2,213,000 925524AV2
- ------------------------------------------------------------------------------------------------------------
15 Weyerhaeuser Company 7.375% March 15, 2032 $2,213,000 962166BR4
- ------------------------------------------------------------------------------------------------------------
16 United States Department of Treasury 0.000% May 15, 2030 $4,305,000 912803CH4
- ------------------------------------------------------------------------------------------------------------
SCHEDULE 2
INDEXPLUS TRUST CERTIFICATES, SERIES 2003-1
SCHEDULE OF DISTRIBUTIONS
The following schedule of distributions assumes that none of the Underlying
Securities are redeemed, accelerated, or otherwise paid prior to their stated
maturity date and that none of the Underlying Securities issuers default on
their payment obligations.
Annualized
Scheduled Effective Scheduled Certificate
Distribution of Pass-Through Rate Distribution Principal
Scheduled Distribution Dates(1) Interest (2) of Principal Balance(3)
Each June 20 and December 20
from June 20, 2004 to and
including December 20, 2028 $1,134,715.75 6.0518% None $37,500,000.00
May 15, 2029 None None $2,213,000.00 35,287,000.00
June 20, 2029 1,061,410.13 6.0159% None 35,287,000.00
December 20, 2029 1,061,410.13 None None 35,287,000.00
May 15, 2030 None None $4,305,000.00 30,982,000.00
June 20, 2030 1,061,410.13 6.8518% None 30,982,000.00
December 20, 2030 1,061,410.13 None None 30,982,000.00
January 18, 2031 None None $2,213,000.00 28,769,000.00
June 20, 2031 967,357.63 6.7250% None 28,769,000.00
July 16, 2031 None None $2,213,000.00 26,556,000.00
November 1, 2031 None None $2,213,000.00 24,343,000.00
December 20, 2031 796,403.38 6.5432% None 24,343,000.00
January 15, 2032 None None $2,213,000.00 22,130,000.00
March 15, 2032 None None $4,426,000.00 17,704,000.00
April 15, 2032 None None $2,213,000.00 15,491,000.00
June 15, 2032 None None $2,213,000.00 13,278,000.00
June 20, 2032 395,020.50 5.9500% None 13,278,000.00
November 15, 2032 None None $2,213,000.00 11,065,000.00
December 20, 2032 316,182.38 5.7150% None 11,065,000.00
February 15, 2033 None None $4,426,000.00 6,639,000.00
February 22, 2033 None None $2,213,000.00 4,426,000.00
May 15, 2033 None None $4,426,000.00 --
EXHIBIT A
Standard Terms for Trust Agreements
(begins on next page)
EXHIBIT B
Form of Certificate
(begins on next page)
EXHIBIT C
Market Agent Agreement
(begins on next page)