-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WSA4OT2srYN51NFOyoBXww7LYf7z2qiOZN5pTH6pwehW6cK7bM5I8qU5LRqJ+B+V o2Okm5A5guhIyk+lhYVYgw== 0000950130-00-006428.txt : 20001205 0000950130-00-006428.hdr.sgml : 20001205 ACCESSION NUMBER: 0000950130-00-006428 CONFORMED SUBMISSION TYPE: S-1/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20001204 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MERRILL LYNCH PIERCE FENNER & SMITH INC CENTRAL INDEX KEY: 0000728612 STANDARD INDUSTRIAL CLASSIFICATION: ASSET-BACKED SECURITIES [6189] STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-1/A SEC ACT: SEC FILE NUMBER: 333-44286 FILM NUMBER: 782556 BUSINESS ADDRESS: STREET 1: NORTH TOWER WORLD FINANCIAL CENTER STREET 2: NORTH TOWER WORLD FINANCIAL CENTER 5TH F CITY: NEW YORK STATE: NY ZIP: 10281-1323 BUSINESS PHONE: 2124496202 MAIL ADDRESS: STREET 1: WORLD FINANCIAL CENTER STREET 2: NORTH TOWER 23RD FL CITY: NEW YORK STATE: NY ZIP: 10281-1323 S-1/A 1 0001.txt AMENDMENT NO. 1 TO FORM S-1 As filed with the Securities and Exchange Commission on December 1, 2000 Registration No. 333-44286 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 -------------- AMENDMENT NO. 1 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 -------------- Merrill Lynch, Pierce, Fenner & Smith Incorporated Initial Depositor (Exact name of registrant as specified in charter) -------------- Europe 2001 HOLDRS SM Trust yet-to-be formed [Issuer with respect to the receipts] Delaware 6211 13-5674085 (State or other (Primary Standard Industrial (I.R.S. Employer jurisdiction Classification Code Number) Identification Number) of incorporation or organization) -------------- 250 Vesey Street New York, New York 10281 (212) 449-1000 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) -------------- Copies to: Andrea L. Dulberg, Esq. Andrew B. Janszky Corporate Secretary Shearman & Sterling Merrill Lynch, Pierce, Fenner & Smith 599 Lexington Avenue Incorporated New York, New York 10022 250 Vesey Street (212) 848-4000 New York, New York 10281 (212) 449-1000 (Name, address, including zip code, and telephone number, including area code, of agent for service) Approximate date of commencement of proposed sale to public: As soon as practicable after this Registration Statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. [X] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If delivery of the prospectus is expected to be made pursuant to Rule 434 under the Securities Act, please check the following box. [_] CALCULATION OF REGISTRATION FEE - ------------------------------------------------------------------------------- - -------------------------------------------------------------------------------
Proposed Proposed Maximum Title of Each Class of Amount Maximum Aggregate Amount of Securities to Be to Be Offering Price Offering Registration Registered Registered Per Receipt(1) Price(1) Fee(2)(3) - ------------------------------------------------------------------------------- Europe 2001 HOLDRS..... 1,000,000,000 $100 $249,850,000 $61,464 receipts - ------------------------------------------------------------------------------- - -------------------------------------------------------------------------------
(1) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457 under the Securities Act. 1,500,000 receipts are estimated to be offered in the initial offering at $100 per receipt and 998,500,000 receipts are estimated to be offered continuously after the initial offering at $0.10 per receipt. (2) This Registration Statement also registers, where required, an indeterminate amount of securities to be sold by Merrill Lynch, Pierce, Fenner & Smith Incorporated in market-making transactions. (3) Merrill Lynch, Pierce, Fenner & Smith Incorporated previously paid on August 22, 2000 $2,640 of this filing fee. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to such Section 8(a), may determine. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ +The information in this prospectus is not complete and may be changed. We + +have filed a registration statement relating to these receipts with the + +Securities and Exchange Commission. We cannot sell these receipts until the + +registration statement becomes effective. This prospectus is not an offer to + +sell these receipts and we are not soliciting offers to buy these receipts in + +any state where such offer or sale is not permitted. + ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subject to Completion Preliminary Prospectus dated December 1, 2000 PROSPECTUS - ------------ [LOGO OF HOLDRS] 1,000,000,000 Depositary Receipts Europe 2001 HOLDRS SM Trust The Europe 2001 HOLDRS SM Trust will issue Depositary Receipts called Europe 2001 HOLDRS SM representing your undivided beneficial ownership in the equity securities of a group of 50 specified companies that, as measured in terms of worldwide market capitalization on November 14, 2000, are among the largest European companies whose equity securities are listed for trading on the New York Stock Exchange or the American Stock Exchange or quoted on the Nasdaq National Market. The Bank of New York will be the trustee. You only may acquire, hold or transfer Europe 2001 HOLDRS in a round-lot amount of 100 Europe 2001 HOLDRS or round-lot multiples. Europe 2001 HOLDRS are separate from the underlying deposited equity securities that are represented by the Europe 2001 HOLDRS. For a list of the names and the number of shares of the companies that make up a Europe 2001 HOLDR, see "Highlights of Europe 2001 HOLDRS--The Europe 2001 HOLDRS" starting on page 9. The trust will issue the additional Europe 2001 HOLDRS on a continuous basis. Investing in Europe 2001 HOLDRS involves significant risks. See "Risk Factors" starting on page 4. The initial public offering price for a round-lot of 100 Europe 2001 HOLDRS will equal the sum of the closing market price on the primary U.S. trading market on the pricing date for each deposited share multiplied by the share amount specified in this prospectus, plus an underwriting fee. Europe 2001 HOLDRS are neither interests in nor obligations of either the initial depositor, Merrill Lynch, Pierce, Fenner & Smith Incorporated, or The Bank of New York, as trustee. Before this issuance, there has been no public market for Europe 2001 HOLDRS. Application has been made to list the Europe 2001 HOLDRS on the American Stock Exchange under the symbol "EKH". ----------- Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
Initial Price Underwriting to Public* Fee ------------- ------------ Per Europe 2001 HOLDR........................ 2%
----- * Includes underwriting fee. For purchases of Europe 2001 HOLDRS in excess of Europe 2001 HOLDRS, the underwriting fee will be %. ----------- Merrill Lynch & Co. Robert W. Baird & Co. A.G. Edwards & Sons, Inc. First Union Securities, Inc. Legg Mason Wood Walker Morgan Keegan & Company, Inc. Incorporated
Raymond James & Associates, Inc. Sutro & Co. Incorporated Tucker Anthony Capital Markets ----------- The date of this prospectus is , 2000. "HOLDRS" and "HOLding Company Depositary ReceiptS" are service marks of Merrill Lynch & Co., Inc. TABLE OF CONTENTS Summary..................................................................... 3 Risk Factors................................................................ 4 Highlights of Europe 2001 HOLDRS............................................ 9 The Trust................................................................... 16 Description of Europe 2001 HOLDRS........................................... 16 Description of The Underlying Securities.................................... 18 Description of The Depositary Trust Agreement............................... 20 Federal Income Tax Consequences............................................. 23 Erisa Considerations........................................................ 26 Plan of Distribution........................................................ 26 Legal Matters............................................................... 27 Where You Can Find More Information......................................... 27
--------------- This prospectus contains information you should consider when making your investment decision. With respect to information about Europe 2001 HOLDRS, you should rely only on the information contained in this prospectus. We have not authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not making an offer to sell Europe 2001 HOLDRS in any jurisdiction where the offer or sale is not permitted. The Europe 2001 HOLDRS are not registered for public sale outside of the United States. Non-U.S. receipt holders should refer to "Federal Income Tax Consequences--Non-U.S. receipt holders" and we recommend that non-U.S. receipt holders consult their tax advisors regarding U.S. withholding and other taxes which may apply to ownership of the Europe 2001 HOLDRS or of the underlying securities through an investment in the Europe 2001 HOLDRS. 2 SUMMARY The Europe 2001 HOLDRS Trust will be formed under the depositary trust agreement, dated as of , 2000 among The Bank of New York, as trustee, Merrill Lynch, Pierce, Fenner & Smith Incorporated, other depositors and the owners of the Europe 2001 HOLDRS. The trust is not a registered investment company under the Investment Company Act of 1940. The trust will hold equity securities issued by 50 specified companies that, as measured in terms of worldwide market capitalization on November 14, 2000, are the largest European companies whose equity securities are listed for trading on the New York Stock Exchange or the American Stock Exchange or quoted on the Nasdaq National Market. The number of shares of each company's equity securities held by the trust with respect to each round-lot of Europe 2001 HOLDRS is specified under "Highlights of Europe 2001 HOLDRS--The Europe 2001 HOLDRS." The securities included in the Europe 2001 HOLDRS consist of American depositary shares, New York registered shares, global shares or ordinary shares and are collectively referred to in this prospectus as equity securities, the securities or underlying securities. The New York Stock Exchange, the American Stock Exchange and the Nasdaq National Market are collectively referred to in this prospectus as U.S. stock markets. The trust will issue Europe 2001 HOLDRS that represent your undivided beneficial ownership interest in the securities held by the trust on your behalf. The Europe 2001 HOLDRS are separate from the underlying securities that are represented by the Europe 2001 HOLDRS. 3 RISK FACTORS An investment in Europe 2001 HOLDRS involves risks similar to investing in each of the underlying securities outside of the Europe 2001 HOLDRS. General Risk Factors . Loss of investment. Because the value of Europe 2001 HOLDRS directly relates to the value of the underlying securities, you may lose a substantial portion of your investment in the Europe 2001 HOLDRS if the underlying securities decline in value. . Discount trading price. Europe 2001 HOLDRS may trade at a discount to the aggregate value of the underlying securities. . Not necessarily consisting of the European companies with the largest market capitalization. The companies included in the Europe 2001 HOLDRS were the 50 largest European companies whose securities are traded on a U.S. stock market, as measured by worldwide market capitalization on November 14, 2000. After November 14, 2000, one or more of the companies may no longer be one of the 50 European companies with the largest market capitalization of companies whose securities are traded on a U.S. stock market. In addition, as a result of a merger, acquisition or stock distribution of one or more of the companies included in the Europe 2001 HOLDRS, the securities of a company that is not presently part of the Europe 2001 HOLDRS may be included in the Europe 2001 HOLDRS. In this case, the Europe 2001 HOLDRS may no longer consist solely of securities issued by European companies with the largest market capitalization and, as a result of mergers, acquisitions and stock distributions, the Europe 2001 HOLDRS may in the future include the securities of companies that are not European. . No investigation of underlying securities. The underlying securities included in the Europe 2001 HOLDRS were selected by Merrill Lynch, Pierce, Fenner & Smith Incorporated based on the market capitalization of European issuers with securities traded on a U.S. stock market, without regard for the value, price performance, volatility or investment merit of the underlying securities. Consequently, the Europe 2001 HOLDRS Trust, the trustee, Merrill Lynch, Pierce, Fenner & Smith Incorporated, and their affiliates, have not performed any investigation or review of the selected companies, including the public filings by the companies. Investors and market participants should not conclude that the inclusion of a company is any form of investment recommendation by the trust, the trustee, Merrill Lynch, Pierce, Fenner & Smith Incorporated, or their affiliates. . Concentration of investment. As a result of market fluctuations and/or reconstitution events, an investment in Europe 2001 HOLDRS may represent a more concentrated investment in one or more of the underlying securities or one or more industries. A concentrated investment will reduce the diversification of the Europe 2001 HOLDRS and increase your exposure to the risks of concentrated investments. . Conflicting investment choices. In order to sell one or more of the underlying securities individually or to participate in a tender offer relating to one or more of the underlying securities, you will be required to cancel your Europe 2001 HOLDRS and receive delivery of each of the underlying securities. The cancellation of your Europe 2001 HOLDRS will allow you to sell individual underlying securities or to deliver individual underlying securities in a tender offer. The cancellation of Europe 2001 HOLDRS will involve payment of a cancellation fee to the trustee. . Trading halts. Trading in Europe 2001 HOLDRS on the American Stock Exchange may be halted if trading in one or more of the underlying securities is halted. Trading in Europe 2001 4 HOLDRS may be halted even if trading continues in some or all of the underlying securities. If trading is halted in the Europe 2001 HOLDRS, you will not be able to trade Europe 2001 HOLDRS and you will only be able to trade the underlying securities if you cancel your Europe 2001 HOLDRS and receive each of the underlying securities. . Delisting from the American Stock Exchange. If the number of companies whose securities are held in the trust falls below nine, the American Stock Exchange may consider delisting the Europe 2001 HOLDRS. If the Europe 2001 HOLDRS are delisted by the American Stock Exchange, a termination event will result unless the Europe 2001 HOLDRS are listed for trading on another U.S. national securities exchange or through Nasdaq NMS within five business days from the date the Europe 2001 HOLDRS are delisted. . Possible conflicts of interest. Merrill Lynch, Pierce, Fenner & Smith Incorporated, as initial depositor, has selected the underlying securities and may face possible conflicts of interest in connection with its activities. For example, Merrill Lynch, Pierce, Fenner & Smith Incorporated and its affiliates, collectively referred to as Merrill Lynch, may engage in investment banking and other activities, may provide services to issuers of the underlying securities in connection with its business, or may make purchases or sales, including establishing long or short positions, in the underlying securities for its own account. In addition, Merrill Lynch, Pierce, Fenner & Smith Incorporated, as initial depositor, will purchase, in the secondary market, the underlying securities that will be deposited into the trust. Merrill Lynch may make these purchases before the deposit into the trust, or it may borrow securities for the deposit and subsequently purchase the securities to repay to the lenders the securities previously borrowed. In either event, the purchases of the underlying securities will be made at various prices. As the initial offering price for the Europe 2001 HOLDRS will be based on the closing market price of each of the underlying securities on the pricing date, Merrill Lynch may recognize a gain on its purchases of the underlying securities. Specifically, if the closing market price for the underlying securities on the pricing date is higher than the price at which Merrill Lynch, Pierce, Fenner & Smith Incorporated, as initial depositor, purchases the underlying securities then it will recognize a gain in connection with such purchases. Merrill Lynch may recognize this gain on any of the underlying securities that comprise the Europe 2001 HOLDRS or on all of the underlying securities in the aggregate. The potential profit of Merrill Lynch also is affected by any hedging activities that it may engage in while it purchases the underlying securities in the secondary market for deposit into the trust. All of these activities may result in conflicts of interest with respect to the financial interest of Merrill Lynch, on the one hand, and, on the other hand, the initial selection of the underlying securities included in the Europe 2001 HOLDRS, Merrill Lynch's activity in the secondary market in the underlying securities, and the creation and cancellation of Europe 2001 HOLDRS by Merrill Lynch. . Temporary price increases in the underlying securities. Purchasing activity in the secondary trading market associated with acquiring the underlying securities for deposit into the trust may temporarily increase the market price of the deposited shares, which will result in a higher initial offering price for the Europe 2001 HOLDRS. Large volumes of purchasing activity, which may occur in connection with the issuance of Europe 2001 HOLDRS, particularly in connection with the initial issuance of Europe 2001 HOLDRS, could temporarily increase the market price of the underlying securities, resulting in a higher price on that date. This purchasing activity could create a temporary imbalance between the supply and demand of the underlying securities, thereby limiting the liquidity of the underlying securities due to a temporary increased demand for underlying securities. Temporary increases in the market price of the underlying securities may also occur as a result of the purchasing activity of other market participants. Other market participants may attempt to benefit from increases in the market price of the underlying securities that may occur as a 5 result of the increased purchasing activity in the underlying securities resulting from the issuance of the Europe 2001 HOLDRS. Consequently, prices for the underlying securities may decline immediately after the pricing date. If the trading prices for the underlying securities decline, the trading price of Europe 2001 HOLDRS will also decline. Risk Factors Specific to Companies Involved in the Europe 2001 HOLDRS . The stock prices of some of the companies included in the Europe 2001 HOLDRS have been and will likely continue to be extremely volatile, which will directly affect the price volatility of the Europe 2001 HOLDRS, and you could lose all or part of your investment. The trading prices of the securities of some companies included in the Europe 2001 HOLDRS have been volatile. These stock prices could be subject to wide fluctuations in response to a variety of factors, including the following: . general market fluctuations; . interest rate and currency fluctuations; . general political and economic conditions, in Europe and throughout the world; . actual or anticipated variations in companies' quarterly operating results; . announcements of technological innovations or new services offered by competitors of the companies included in the Europe 2001 HOLDRS; . changes in financial estimates by securities analysts; . legal or regulatory developments affecting the companies included in the Europe 2001 HOLDRS; . announcements by competitors of the companies included in the Europe 2001 HOLDRS of significant acquisitions, strategic partnerships, joint ventures or capital commitments; . departures of key personnel; and . sales of securities of companies included in Europe 2001 HOLDRS in the open market. . The international operations of the companies included in the Europe 2001 HOLDRS expose them to risks associated with instability and changes in economic and political conditions, foreign currency fluctuations, changes in foreign regulations and other risks inherent to international business. The companies included in the Europe 2001 HOLDRS have international operations which are essential parts of their businesses. The risks of international business that these companies are exposed to include the following: . general economic, social and political conditions; . the difficulty of enforcing intellectual property rights, agreements and collecting receivables through certain foreign legal systems; . differing tax rates, tariffs, exchange controls or other similar restrictions; . currency fluctuations; . changes in, and compliance with, domestic and foreign laws and regulations which impose a range of restrictions on operations, trade practices, foreign trade and international investment decisions; and . reduction in the number or capacity of personnel in international markets. . It may be impossible to initiate legal proceedings or enforce judgments against many of the companies included in the Europe 2001 HOLDRS. The companies included in the Europe 6 2001 HOLDRS were incorporated under the laws of a jurisdiction other than the United States and a substantial portion of their assets are located outside the United States. As a result, it may be impossible to effect service of process within the United States on the companies included in the Europe 2001 HOLDRS or enforce judgments made against them in courts in the United States based on civil liability provisions of the securities laws of the United States. In addition, judgments obtained in the United States, especially those awarding punitive damages, may not be enforceable in foreign countries. . Potential voting impediments may exist with respect to the ownership of some of the underlying securities included in the Europe 2001 HOLDRS. Holders of American depositary shares, including those included in the Europe 2001 HOLDRS, may only exercise voting rights with respect to the securities represented by American depositary shares in accordance with the provisions of deposit agreements entered into in connection with the issuance of the American depositary shares. These deposit agreements may not permit holders of American depositary shares to exercise voting rights that attach to the securities underlying the American depositary shares without the issuer first instructing the depositary to send voting information to the holder of the American depositary share. Also, holders of American depository shares may not exercise voting rights unless they take a variety of steps, which include registration in the share registry of the company that has issued the securities underlying the American depositary shares. The cumulative effect of these steps may make it impractical for holders of American depositary shares to exercise the voting rights attached to the underlying securities. . Some of the underlying securities included in the Europe 2001 HOLDRS are not U.S. shares or American depositary shares and, as a result, may be subject to different procedures relating to the repayment of taxes and the activities of the transfer agent. The securities of some companies included in the Europe 2001 HOLDRS are subject to withholding tax on dividends and distributions. Some companies may not have special arrangements in place for refunding these withheld taxes. In such case, the holders of these securities will have to independently apply to a foreign tax authority for repayment of withheld taxes. In addition, some of the companies included in the Europe 2001 HOLDRS may also have a non-U.S. transfer agent and may hold the securities outside of the United States. Non-U.S. transfer agents are not subject to procedures that govern the activities of transfer agents in the United States. . The primary trading market of most of the underlying securities of Europe 2001 HOLDRS are not U.S. stock exchanges; accordingly, the trading volume of some of the underlying securities may be very low, which could adversely affect the market price of the Europe 2001 HOLDRS. In some cases, the trading volume of some of the underlying securities on a U.S. stock exchange is or may become limited. A low trading volume or liquidity of any of the underlying securities on U.S. stock exchange may adversely affect the market price of an underlying security and of the Europe 2001 HOLDRS. . Exchange rate fluctuations could adversely affect the market price of the underlying securities included in the Europe 2001 HOLDRS and the value of the dividends paid by those companies. The result of operations and the financial position of some of the companies underlying Europe 2001 HOLDRS are reported in local currencies. Exchange rate fluctuations between these currencies and the U.S. dollar may adversely affect the market price of the U.S. exchange listed security and the Europe 2001 HOLDRS. In addition, any dividends that are declared, if any, will likely be set in terms of a currency other than U.S. dollars. As a result, exchange rate fluctuations may also negatively affect the value of dividends declared by many of the companies included in the Europe 2001 HOLDRS. . Many of the companies included in the Europe 2001 HOLDRS are companies which are involved in the technology and telecommunications industries and are subject to the risks associated with an investment in companies in those industries. The valuations of many technology and telecommunications companies are extraordinarily high based on 7 conventional valuation standards, such as price to earnings and price to sales ratios. As a result, the valuations of companies in these industries, and the trading prices for their stock, may not be sustained. In addition, a company which operates in these industries is exposed to other risks which include the following: . the need to keep pace with rapid technological change in order to remain competitive and to prevent the obsolescence of their products and services; . an inability to adequately protect proprietary rights; . changes in the regulatory environment in which telecommunications companies operate could affect their ability to offer new or existing products and services; and . the need to create and employ new technologies and to offer new services derived from these new technologies to remain competitive. An investment in the Europe 2001 HOLDRS may also be particularly vulnerable to these additional risks because of the significant number of technology and telecommunications companies included in the Europe 2001 HOLDRS. . Many of the companies included in the Europe 2001 HOLDRS are companies which are involved in the healthcare industry and are subject to the additional risks associated with an investment in companies in this industry. The stock prices of companies involved in the healthcare industry are subject to wide fluctuations in response to a variety of factors including: . announcements of technological innovations or new commercial products; . developments in patent or proprietary rights; and . government regulatory initiatives; . government regulatory approval processes for product testing and commercialization; and . public concern as to the safety or other implications of healthcare products and services. An investment in the Europe 2001 HOLDRS may also be particularly vulnerable to these additional risks because of the significant number of healthcare companies included in the Europe 2001 HOLDRS. 8 HIGHLIGHTS OF EUROPE 2001 HOLDRS This discussion highlights information regarding Europe 2001 HOLDRS. We present certain information more fully in the rest of this prospectus. You should read the entire prospectus carefully before you purchase Europe 2001 HOLDRS. Issuer....................... Europe 2001 HOLDRS Trust. The trust.................... The Europe 2001 HOLDRS Trust will be formed under the depositary trust agreement, dated as of , 2000 among The Bank of New York, as trustee, Merrill Lynch, Pierce, Fenner & Smith Incorporated, other depositors and the owners of the Europe 2001 HOLDRS. The trust is not a registered investment company under the Investment Company Act of 1940. Initial depositor............ Merrill Lynch, Pierce, Fenner & Smith Incorporated. Trustee...................... The Bank of New York, a New York state- chartered banking organization, will be the trustee and receive compensation as set forth in the depositary trust agreement. Purpose of Europe 2001 Europe 2001 HOLDRS are designed to achieve the HOLDRS.................. following: Diversification. Europe 2001 HOLDRS are designed to allow you to diversify your investments by holding the equity securities of 50 companies, that are the largest European companies with securities traded on a U.S. stock market as measured in terms of worldwide market capitalization on November 14, 2000, through a single, exchange-listed instrument representing your undivided beneficial ownership of the underlying securities. Flexibility. The beneficial owners of Europe 2001 HOLDRS have undivided beneficial ownership interests in each of the underlying securities represented by the Europe 2001 HOLDRS, and can cancel their Europe 2001 HOLDRS to receive each of the underlying securities represented by the Europe 2001 HOLDRS. Transaction costs. The expenses associated with buying and selling Europe 2001 HOLDRS in the secondary market are expected to be less than separately buying and selling each of the underlying securities in a traditional brokerage account with transaction-based charges. Trust assets................. The trust will hold the equity securities of 50 companies that are the largest European companies with securities traded on a U.S. stock market as measured in terms of worldwide market capitalization on November 14, 2000. The trust's assets may increase or decrease as a result of in-kind deposits and withdrawals of the underlying securities during the life of the trust. The Europe 2001 HOLDRS....... The trust will issue Europe 2001 HOLDRS that represent your undivided beneficial ownership interest in the shares of U.S.-traded securities held by the trust on your behalf. The Europe 2001 HOLDRS themselves are separate from the underlying securities that are represented by the Europe 2001 HOLDRS. 9 The specific share amounts for each round-lot of 100 Europe 2001 HOLDRS will be determined on the pricing date so that the initial issue price will be approximately $90-$100 per Europe 2001 HOLDR and the initial weightings of each underlying security included in the Europe 2001 HOLDRS will be approximately 2%. Since only whole share amounts are included in each round- lot of 100 Europe 2001 HOLDRS and because of fluctuations in closing market prices of the underlying securities, the initial weightings of each of the underlying securities will not be 2% and each could be significantly above or below 2%. For purposes of this preliminary prospectus, the indicative share amounts and the indicative weightings of each underlying security as of November 14, 2000 are set forth in the table below. However, such share amounts and weightings may change during the period between November 14, 2000 and the pricing date to adjust the initial weightings of the underlying securities to provide initial weightings of each of the underlying securities that are each approximately 2%; however actual weightings could each be significantly above or below 2%, as discussed above. After the pricing date, the share amounts will not change, except for changes due to corporate events, such as stock splits or reverse stock splits on the underlying securities, or reconstitution events. However, the weightings are expected to change substantially over time because of price fluctuations. The following table provides the . names of the 50 issuers of the underlying securities represented by the Europe 2001 HOLDRS, . stock ticker symbols, . indicative share amounts represented by a round-lot of 100 Europe 2001 HOLDRS as of November 14, 2000, . indicative weightings as of November 14, 2000, and . principal U.S. market on which the underlying securities are traded.
Primary Indicative U.S. Share Indicative Trading Name of Company Ticker Amounts Weightings Market --------------- ------ ---------- ---------- ---------- Alcatel* ALA 3 1.90% NYSE Amdocs Limited DOX 3 2.12% NYSE Arm Holdings PLC* ARMHY 6 1.91% Nasdaq NMS ASM International NV ASMI 13 2.01% Nasdaq NMS ASM Lithography Holding N.V. ASML 8 2.10% Nasdaq NMS AstraZeneca P.L.C. * AZN 4 2.07% NYSE Autonomy Corporation PLC* AUTN 4 2.06% Nasdaq NMS Aventis S.A. * AVE 2 1.61% NYSE AXA Financial, Inc. * AXA 3 2.23% NYSE Bookham Technology PLC* BKHM 8 2.01% Nasdaq NMS
10
Primary Indicative U.S. Share Indicative Trading Name of Company Ticker Amounts Weightings Market --------------- ------ ---------- ---------- ---------- BP Amoco P.L.C. * BP 4 2.21% NYSE Business Objects S.A. * BOBJ 2 1.69% Nasdaq NMS Cable & Wireless Public Limited Company* CWP 5 2.02% NYSE DaimlerChrysler AG DCX 4 2.00% NYSE Deutsche Telekom AG* DT 5 1.95% NYSE Diageo PLC* DEO 5 2.13% NYSE Elan Corporation, p.l.c. * ELN 4 2.09% NYSE LM Ericsson Telephone Company* ERICY 15 1.94% Nasdaq NMS Glaxo Wellcome p.l.c. * GLX 3 1.91% NYSE Infineon Technologies AG* IFX 4 1.78% NYSE ING Groep N.V. * ING 3 2.33% NYSE Iona Technologies p.l.c. * IONA 3 2.09% Nasdaq NMS Jazztel p.l.c. * JAZZ 14 2.02% Nasdaq NMS Koninklijke Philips Electronics N.V. PHG 5 2.02% NYSE KPNQuest N.V. KQIP 8 1.98% Nasdaq NMS Millicom International Cellular S.A. MICC 6 1.91% Nasdaq NMS Nokia Corp. * NOK 5 2.20% NYSE Novartis AG* NVS 5 2.14% NYSE Qiagen N.V. QGENF 5 1.89% Nasdaq NMS Repsol YPF, S.A. * REP 11 1.96% NYSE Royal Dutch Petroleum Company RD 3 1.95% NYSE Ryanair Holdings p.l.c. * RYAAY 4 1.93% Nasdaq NMS SAP AG* SAP 4 2.00% NYSE Scottish Power p.l.c. * SPI 6 2.03% NYSE Serono S.A. * SRA 8 1.94% NYSE Shire Pharmaceuticals Group p.l.c. * SHPGY 3 2.06% Nasdaq NMS Smartforce public limited company* SMTF 4 2.07% Nasdaq NMS Smithkline Beecham p.l.c. * SBH 3 2.17% NYSE Sonera Group p.l.c. * SNRA 10 2.08% Nasdaq NMS STMicroelectronics NV STM 4 1.96% NYSE Telefonica S.A. * TEF 3 1.82% NYSE Terra Lycos, Inc. * TRLY 9 1.95% Nasdaq NMS Total Fina Elf S.A. * TOT 3 2.31% NYSE UBS AG UBS 1 1.51% NYSE Unilever N.V. UN 3 1.83% NYSE United Pan-Europe Communications N.V. * UPCOY 12 1.96% Nasdaq NMS Vivendi* V 13 2.03% NYSE Vodafone Airtouch PLC* VOD 5 2.07% NYSE WPP Group plc* WPPGY 3 1.89% Nasdaq NMS
-------- * The securities of this non-U.S. company trade in the United States as American depositary shares. Please see "Risk Factors" and "Federal Income Tax Consequences-special considerations with respect to underlying securities of foreign issuers" for additional information relating to an investment in a non-U.S. company. 11 The actual share amounts and weightings will be determined on the pricing date and will appear in the final prospectus delivered in connection with sales of the Europe 2001 HOLDRS. These companies are the 50 largest European companies measured in terms of worldwide market capitalization on November 14, 2000, with securities traded on a U.S. stock market. The market capitalization of a company is determined by multiplying the market price of its securities by the number of its outstanding securities. The trust only will issue and cancel, and you only may obtain, hold, trade or surrender Europe 2001 HOLDRS in a round-lot of 100 Europe 2001 HOLDRS and round-lot multiples. The trust will only issue Europe 2001 HOLDRS upon the deposit of the whole shares represented by a round-lot of 100 Europe 2001 HOLDRS. In the event that a fractional share comes to be represented by a round-lot of EUROPE 2001 HOLDRS, the trust may require a minimum of more than one round-lot of 100 Europe 2001 HOLDRS for an issuance so that the trust will always receive whole share amounts for issuance of Europe 2001 HOLDRS. The number of outstanding Europe 2001 HOLDRS will increase and decrease as a result of in- kind deposits and withdrawals of the underlying securities. The trust will stand ready to issue additional Europe 2001 HOLDRS on a continuous basis when an investor deposits the required securities with the trustee. Public offering price........ The initial public offering price for 100 Europe 2001 HOLDRS will equal the sum of the closing market price on the primary U.S. trading market on the pricing date for each underlying security multiplied by the share amount to be determined on the pricing date, plus an underwriting fee. It is expected that the initial public offering price will be approximately $90-$100 per Europe 2001 HOLDR. Purchases.................... After the initial offering, you may acquire Europe 2001 HOLDRS in two ways: . through an in-kind deposit of the required number of securities of the underlying issuers with the trustee, or . through a cash purchase in the secondary trading market. Underwriting fees............ If you purchase Europe 2001 HOLDRS in the initial public offering, you will pay an underwriting fee equal to: . For purchases of Europe 2001 HOLDRS or fewer, 2%. . For purchases in excess of Europe 2001 HOLDRS, %. You will not be charged any issuance fee or other sales commission in connection with purchases of Europe 2001 HOLDRS made in the initial public offering. 12 Issuance and cancellation fees......................... After the initial offering, if you wish to create Europe 2001 HOLDRS by delivering to the trust the requisite securities represented by a round-lot of 100 Europe 2001 HOLDRS, The Bank of New York as trustee will charge you an issuance fee of up to $10.00 for each round-lot of 100 Europe 2001 HOLDRS. If you wish to cancel your Europe 2001 HOLDRS and withdraw your underlying securities, The Bank of New York as trustee will charge you a cancellation fee of up to $10.00 for each round-lot of 100 Europe 2001 HOLDRS. Commissions.................. If you choose to deposit underlying securities in order to receive Europe 2001 HOLDRS after the conclusion of the initial public offering, you will not be charged the underwriting fee. However, in addition to the issuance fee charged by the trustee described above, you will be responsible for paying any sales commission associated with your purchase of the underlying securities that is charged by your broker. Custody fees................. The Bank of New York, as trustee and as custodian, will charge you a quarterly custody fee of $2.00 for each round-lot of 100 Europe 2001 HOLDRS, to be deducted from any cash dividend or other cash distributions on underlying securities received by the trust. With respect to the aggregate custody fee payable in any calendar year for each Europe 2001 HOLDR, the trustee will waive that portion of the fee which exceeds the total cash dividends and other cash distributions received, or to be received, and payable with respect to such calendar year. Rights relating to Europe 2001 HOLDRS............. You have the right to withdraw the underlying securities upon request by delivering a round- lot or integral multiple of a round-lot of Europe 2001 HOLDRS to the trustee, during the trustee's business hours, and paying the cancellation fees, taxes, and other charges. You should receive the underlying securities no later than the business day after the trustee receives a proper notice of cancellation. The trustee will not deliver fractional shares of underlying securities. To the extent that any cancellation of Europe 2001 HOLDRS would otherwise require the delivery of a fractional share, the trustee will sell such share in the market and the trust, in turn, will deliver cash in lieu of such share. Except with respect to the right to vote for dissolution of the trust, the Europe 2001 HOLDRS themselves will not have voting rights. Rights relating to the underlying securities........ You have the right to: . Receive all shareholder disclosure materials, including annual and quarterly reports, distributed by the issuers of the underlying securities. . Receive all proxy materials distributed by the issuers of the underlying securities and to instruct the trustee to vote the underlying securities or attend shareholder meetings yourself. 13 . Receive dividends and other distributions on the underlying securities, if any are declared and paid to the trustee by an issuer of the underlying securities, net of any applicable taxes or fees. However, any distribution of securities by an issuer of underlying securities will be deposited into the trust and will become part of the Europe 2001 HOLDRS if the securities are listed for trading on a U.S. national securities exchange or through Nasdaq NMS. If you wish to participate in a tender offer for underlying securities, you must obtain the underlying securities by surrendering your Europe 2001 HOLDRS and receiving all of your underlying securities. For specific information about obtaining your underlying securities, you should read the discussion under the caption "Description of the depositary trust agreement." Reconstitution events........ The depositary trust agreement provides for the automatic distribution of underlying securities from the Europe 2001 HOLDRS to you in the following four circumstances: A. If an issuer of underlying securities no longer has a class of securities registered under section 12 of the Securities Exchange Act of 1934, then its securities will no longer be an underlying security and the trustee will distribute the shares of that company to the owners of the Europe 2001 HOLDRS. B. If the SEC finds that an issuer of underlying securities should be registered as an investment company under the Investment Company Act of 1940, and the trustee has actual knowledge of the SEC finding, then the trustee will distribute the shares of that company to the owners of the Europe 2001 HOLDRS. C. If the underlying securities of an issuer cease to be outstanding as a result of a merger, consolidation or other corporate combination, the trustee will distribute the consideration paid by and received from the acquiring company to the beneficial owners of Europe 2001 HOLDRS, unless the consideration received is securities that are listed for trading on a U.S. national securities exchange or through Nasdaq NMS. In this case, the securities received will be treated as additional underlying securities and will be deposited into the trust. D. If an issuer's underlying securities are delisted from trading on a U.S. national securities exchange or through Nasdaq NMS and are not listed for trading on another U.S. national securities exchange or through Nasdaq NMS within five business days from the date the securities are delisted. If a reconstitution event occurs, the trustee will deliver the underlying security to you as promptly as practicable after the date that the trustee has knowledge of the occurrence of a reconstitution event. However, any distribution of securities that are listed for 14 trading on a U.S. national securities exchange or through Nasdaq NMS will be deposited into the trust and will become part of the Europe 2001 HOLDRS. Termination events........... A. The Europe 2001 HOLDRS are delisted from the American Stock Exchange and are not listed for trading on another U.S. national securities exchange or through Nasdaq NMS within five business days from the date the Europe 2001 HOLDRS are delisted. B. The trustee resigns and no successor trustee is appointed within 60 days from the date the trustee provides notice to Merrill Lynch, Pierce, Fenner & Smith Incorporated, as initial depositor, of its intent to resign. C. 75% of beneficial owners of outstanding Europe 2001 HOLDRS vote to dissolve and liquidate the trust. If a termination event occurs, the trustee will distribute the underlying securities to you as promptly as practicable after the termination event. Federal income tax consequences................. The federal income tax laws will treat a U.S. holder of Europe 2001 HOLDRS as directly owning the underlying securities. The Europe 2001 HOLDRS themselves will not result in any federal tax consequences separate from the tax consequences associated with ownership of the underlying securities. Listing...................... Application has been made to list the Europe 2001 HOLDRS on the American Stock Exchange under the symbol "EKH." Trading will take place only in round-lots of 100 Europe 2001 HOLDRS and round-lot multiples. A minimum of 150,000 Europe 2001 HOLDRS will be required to be outstanding when trading begins. Trading...................... Investors only will be able to acquire, hold, transfer and surrender a round-lot of 100 Europe 2001 HOLDRS. Bid and ask prices, however, will be quoted per single Europe 2001 HOLDR. Clearance and settlement..... The trust will issue Europe 2001 HOLDRS in book-entry form. Europe 2001 HOLDRS will be evidenced by one or more global certificates that the trustee will deposit with The Depository Trust Company, referred to as DTC. Transfers within DTC will be in accordance with DTC's usual rules and operating procedures. For further information see "Description of Europe 2001 HOLDRS." 15 THE TRUST General. This discussion highlights information about the Europe 2001 HOLDRS Trust. You should read this information and information about the depositary trust agreement, as well as the depositary trust agreement before you purchase Europe 2001 HOLDRS. The material terms of the depositary trust agreement are described in this prospectus under the heading "Description of the depositary trust agreement." The Europe 2001 HOLDRS Trust. The trust will be formed pursuant to the depositary trust agreement, dated as of , 2000. The Bank of New York will be the trustee. The Europe 2001 HOLDRS Trust is not a registered investment company under the Investment Company Act of 1940. The Europe 2001 HOLDRS Trust is intended to hold deposited shares for the benefit of owners of Europe 2001 HOLDRS. The trustee will perform only administrative and ministerial acts. The property of the trust will consist of the underlying securities and all monies or other property, if any, received by the trustee. The trust will terminate on December 31, 2040, or earlier if a termination event occurs. DESCRIPTION OF EUROPE 2001 HOLDRS The trust will issue Europe 2001 HOLDRS under the depositary trust agreement described in this prospectus under the heading "Description of the depositary trust agreement." After the initial offering, the trust may issue additional Europe 2001 HOLDRS on a continuous basis when an investor deposits the requisite underlying securities with the trustee. You may only acquire, hold, trade and surrender Europe 2001 HOLDRS in a round-lot of 100 Europe 2001 HOLDRS and round-lot multiples. The trust will only issue Europe 2001 HOLDRS upon the deposit of the whole shares of underlying securities that are represented by a round-lot of 100 Europe 2001 HOLDRS. In the event of a stock split, reverse stock split, or other distribution by the issuer of an underlying security that results in a fractional share becoming represented by a round-lot of Europe 2001 HOLDRS, the trust may require a minimum of more than one round-lot of 100 Europe 2001 HOLDRS for an issuance so that the trust will always receive whole share amounts for issuance of Europe 2001 HOLDRS. Europe 2001 HOLDRS will represent your individual and undivided beneficial ownership interest in the specified underlying securities. The 50 companies selected as part of this receipt program are listed above in the section entitled "Highlights of Europe 2001 HOLDRS--The Europe 2001 HOLDRS." Beneficial owners of Europe 2001 HOLDRS will have the same rights and privileges as they would have if they beneficially owned the underlying securities outside of the trust. These include the right of investors to instruct the trustee to vote the securities, and to receive dividends and other distributions on the underlying securities, if any are declared and paid to the trustee by an issuer of an underlying security, as well as the right to cancel Europe 2001 HOLDRS to receive the underlying securities. See "Description of the depositary trust agreement." Europe 2001 HOLDRS are not intended to change your beneficial ownership in the underlying securities under federal securities laws, including sections 13(d) and 16(a) of the Securities Exchange Act of 1934. The trust will not publish or otherwise calculate the aggregate value of the underlying securities represented by a receipt. Europe 2001 HOLDRS may trade in the secondary market at prices that are lower than the aggregate value of the corresponding underlying securities. If, in such case, an owner of Europe 2001 HOLDRS wishes to realize the dollar value of the underlying securities, that owner will have to cancel the Europe 2001 HOLDRS. Such cancellation will require payment of fees and expenses as described in "Description of the depositary trust agreement--Withdrawal of underlying securities." 16 Europe 2001 HOLDRS will be evidenced by one or more global certificates that the trustee will deposit with DTC and register in the name of Cede & Co., as nominee for DTC. Europe 2001 HOLDRS will be available only in book-entry form. Owners of Europe 2001 HOLDRS may hold their Europe 2001 HOLDRS through DTC, if they are participants in DTC, or indirectly through entities that are participants in DTC. 17 DESCRIPTION OF THE UNDERLYING SECURITIES Selection criteria. The underlying securities of the Europe 2001 HOLDRS are the equity securities of a group of 50 specified companies which are the largest European companies whose securities are traded on a U.S. stock market, as measured in terms of worldwide market capitalization on November 14, 2000. The market capitalization of a company is determined by multiplying the market price of its securities by the number of its outstanding securities. After November 14, 2000, one or more of the issuers of the underlying securities may no longer be one of the 50 European companies with the largest market capitalization of companies whose securities are traded on a US stock market. In this case, the Europe 2001 HOLDRS may consist of securities issued by European companies that do not have the largest market capitalization. In addition, as a result of a reconstitution event or a distribution of securities, the securities of a non-European company may be included in the Europe 2001 HOLDRS. Merrill Lynch, Pierce, Fenner & Smith Incorporated will determine, in its sole discretion, whether the issuer of a particular underlying security continues to have a leading market capitalization and will undertake to make adequate disclosure when necessary. Underlying securities. For a list of the underlying securities represented by Europe 2001 HOLDRS, please refer to "Highlights of Europe 2001 HOLDRS--The Europe 2001 HOLDRS." If the underlying securities change because of a reconstitution event or as a result of a distribution of securities, a revised list of underlying securities will be set forth in a prospectus supplement and will be available from the American Stock Exchange and through a widely used electronic information dissemination system such as Bloomberg or Reuters. No investigation. In selecting the underlying securities, the trust, the trustee, Merrill Lynch, Pierce, Fenner & Smith Incorporated, and any affiliate of these entities, have not performed any investigation or review of the selected companies, including the public filings by the companies, other than to the extent required to determine whether the companies satisfied the program's stated selection criteria. Accordingly, before you acquire Europe 2001 HOLDRS, you should consider publicly available financial and other information about the issuers of the underlying securities. See "Risk Factors" and "Where you can find more information." Investors and market participants should not conclude that the inclusion of a company in the list is any form of investment recommendation of that company by the trust, the trustee, Merrill Lynch, Pierce, Fenner & Smith Incorporated, the selling group or any of their affiliates. General background and historical information. For a brief description of the business of each of the issuers of the underlying securities and monthly pricing information showing the historical performance of each underlying issuer's securities see "Annex A." 18 The following table and graph set forth the composite performance of all of the underlying securities represented by a single Europe 2001 HOLDR based upon the indicative share amounts set forth in the table on page 10 of this preliminary prospectus, measured at the close of each business day from July 27, 2000, the first date when all of the underlying securities were publicly traded, to November 30, 2000. The performance table and graph data are adjusted for any splits that may have occurred over the measurement period. Past movements of the underlying securities are not necessarily indicative of future values. The actual share amounts will be determined on the pricing date and may differ from the indicative share amounts.
2000 Value - ---- ------ July 27........... 117.25 July 28........... 113.83 July 31........... 115.02 August 01......... 114.25 August 02......... 113.16 August 03......... 111.11 August 04......... 111.88 August 07......... 113.84 August 08......... 112.45 August 09......... 112.35 August 10......... 112.92 August 11......... 113.24 August 14......... 114.52 August 15......... 114.99 August 16......... 114.95 August 17......... 115.78 August 18......... 115.00 August 21......... 114.45 August 22......... 113.35 August 23......... 112.57 August 24......... 113.55 August 25......... 114.02 August 28......... 114.56 August 29......... 113.92 August 30......... 114.48 August 31......... 117.52 September 01...... 120.78 September 05...... 118.37 September 06...... 114.02 September 07...... 115.07
2000 Value - ---- ------ September 08...... 111.93 September 11...... 110.55 September 12...... 110.35 September 13...... 109.86 September 14...... 110.91 September 15...... 109.09 September 18...... 106.75 September 19...... 108.37 September 20...... 104.79 September 21...... 103.53 September 22...... 105.21 September 25...... 104.18 September 26...... 103.61 September 27...... 104.55 September 28...... 105.93 September 29...... 103.54 October 02........ 103.88 October 03........ 103.15 October 04........ 103.52 October 05........ 102.96 October 06........ 99.63 October 09........ 98.36 October 10........ 96.76 October 11........ 93.70 October 12........ 90.60 October 13........ 94.61 October 16........ 93.52 October 17........ 90.69 October 18........ 88.87 October 19........ 93.23
2000 Value - ---- ----- October 20......... 93.57 October 23......... 93.51 October 24......... 95.97 October 25......... 91.78 October 26......... 93.71 October 27......... 95.45 October 30......... 94.91 October 31......... 97.73 November 01........ 97.32 November 02........ 98.32 November 03........ 99.12 November 06........ 98.91 November 07........ 97.84 November 08........ 95.72 November 09........ 94.20 November 10........ 90.48 November 13........ 89.25 November 14........ 92.73 November 15........ 92.76 November 16........ 90.07 November 17........ 89.64 November 20........ 86.44 November 21........ 86.27 November 22........ 82.78 November 24........ 87.32 November 27........ 88.33 November 28........ 85.16 November 29........ 85.08 November 30........ 83.21
[LINE GRAPH] 19 DESCRIPTION OF THE DEPOSITARY TRUST AGREEMENT General. The depositary trust agreement, dated as of , 2000, among Merrill Lynch, Pierce, Fenner & Smith Incorporated, The Bank of New York, as trustee, other depositors and the owners of the Europe 2001 HOLDRS, provides that Europe 2001 HOLDRS will represent an owner's undivided beneficial ownership interest in the securities of the underlying companies. The trustee. The Bank of New York will serve as trustee. The Bank of New York, which was founded in 1784, was New York's first bank and is the oldest bank in the country still operating under its original name. The Bank is a state-chartered New York banking corporation and a member of the Federal Reserve System. The Bank conducts a national and international wholesale banking business and a retail banking business in the New York City, New Jersey and Connecticut areas, and provides a comprehensive range of corporate and personal trust, securities processing and investment services. In addition, The Bank of New York acts as depositary for some foreign issuers whose American depositary shares are included in the Europe 2001 HOLDRS. Issuance, transfer and surrender of Europe 2001 HOLDRS. You may create and cancel Europe 2001 HOLDRS only in round-lots of 100 Europe 2001 HOLDRS. You may create Europe 2001 HOLDRS by delivering to the trustee the requisite underlying securities. The trust will only issue Europe 2001 HOLDRS upon the deposit of the whole shares represented by a round-lot of 100 Europe 2001 HOLDRS. In the event that a fractional share comes to be represented by a round-lot of Europe 2001 HOLDRS, the trust may require a minimum of more than one round-lot of 100 Europe 2001 HOLDRS for an issuance so that the trust will always receive whole share amounts for issuance of Europe 2001 HOLDRS. Similarly, you must surrender Europe 2001 HOLDRS in integral multiples of 100 Europe 2001 HOLDRS to withdraw deposited shares from the trust. The trustee will not deliver fractional shares of underlying securities, and to the extent that any cancellation of Europe 2001 HOLDRS would otherwise require the delivery of fractional shares, the trust will deliver cash in lieu of such shares. You may request withdrawal of your deposited shares during the trustee's normal business hours. The trustee expects that in most cases it will deliver your deposited shares within one business day of your withdrawal request. Voting rights. The trustee will deliver you proxy soliciting materials provided by issuers of the deposited shares so as to permit you to give the trustee instructions as to how to vote on matters to be considered at any annual or special meetings held by issuers of the underlying securities. Under the depositary trust agreement, any beneficial owner of Europe 2001 HOLDRS, other than Merrill Lynch, Pierce, Fenner & Smith Incorporated owning Europe 2001 HOLDRS for its own proprietary account as principal, will have the right to vote to dissolve and liquidate the trust. Distributions. You will be entitled to receive, net of trustee fees, distributions of cash, including dividends, securities or property, if any, made with respect to the underlying securities. The trustee will use its reasonable efforts to ensure that it distributes these distributions as promptly as practicable after the date on which it receives the distribution. Therefore, you may receive your distributions substantially later than you would have had you held the underlying securities directly. Any distributions of securities by an issuer of underlying securities will be deposited into the trust and will become part of the Europe 2001 HOLDRS if such securities are listed for trading on a U.S. national securities exchange or through Nasdaq NMS. You will be obligated to pay any tax or other charge that may become due with respect to Europe 2001 HOLDRS. The trustee may deduct the amount of any tax or other governmental charge from a distribution before making payment to you. In addition, the trustee will deduct its quarterly custody fee of $2.00 for each round-lot of 100 Europe 2001 HOLDRS from quarterly dividends, if any, paid to the trustee by the issuers of the underlying securities. With respect to the aggregate custody fee payable in any calendar year for each Europe 2001 HOLDR, the trustee will waive that portion of the fee which exceeds the total cash dividends and other cash distributions received, or to be received, and payable with respect to such calendar year. 20 Record dates. With respect to dividend payments and voting instructions, the trustee expects to fix the trust's record dates as close as possible to the record date fixed by the issuer of the underlying securities. Shareholder communications. The trustee promptly will forward to you all shareholder communications that it receives from issuers of the underlying securities. Withdrawal of underlying securities. You may surrender your Europe 2001 HOLDRS and receive underlying securities during the trustee's normal business hours and upon the payment of applicable fees, taxes or governmental charges, if any. You should receive your underlying securities no later than the business day after the trustee receives your request. If you surrender Europe 2001 HOLDRS in order to receive underlying securities, you will pay to the trustee a cancellation fee of up to $10.00 per round-lot of 100 Europe 2001 HOLDRS. Further issuances of Europe 2001 HOLDRS. The depositary trust agreement provides for further issuances of Europe 2001 HOLDRS on a continuous basis without your consent. Reconstitution events. The depositary trust agreement provides for the automatic distribution of underlying securities to you in the following four circumstances: A. If an issuer of underlying securities no longer has a class of securities registered under section 12 of the Securities Exchange Act of 1934, then its securities will no longer be an underlying security and the trustee will distribute the shares of that company to the owners of the Europe 2001 HOLDRS. B. If the SEC finds that an issuer of underlying securities should be registered as an investment company under the Investment Company Act of 1940, and the trustee has actual knowledge of the SEC finding, then the trustee will distribute the shares of that company to the owners of the Europe 2001 HOLDRS. C. If the underlying securities of an issuer cease to be outstanding as a result of a merger, consolidation or other corporate combination, the trustee will distribute the consideration paid by and received from the acquiring company to the beneficial owners of Europe 2001 HOLDRS, unless the consideration received is securities that are listed for trading on a U.S. national securities exchange or through Nasdaq NMS. In this case, the securities received will be treated as additional underlying securities and will be deposited into the trust. D. If an issuer's underlying securities are delisted from trading on a U.S. national securities exchange or through Nasdaq NMS and are not listed for trading on another U.S. national securities exchange or through Nasdaq NMS within 5 business days from the date the securities are delisted. If a reconstitution event occurs, the trustee will deliver the underlying security to you as promptly as practicable after the date that the trustee has knowledge of the occurrence of a reconstitution event. However, any distributions of securities that are listed for trading on a U.S. securities exchange or through Nasdaq will be deposited into the trust and will become part of the Europe 2001 HOLDRS. Termination of the trust. The trust will terminate if the trustee resigns and no successor trustee is appointed by Merrill Lynch, Pierce, Fenner & Smith Incorporated, as initial depositor, within 60 days from the date the trustee provides notice to Merrill Lynch, Pierce, Fenner & Smith Incorporated, as initial depositor, of its intent to resign. Upon termination, the beneficial owners of Europe 2001 HOLDRS will surrender their Europe 2001 HOLDRS as provided in the depositary trust agreement, including payment of any fees of the trustee or applicable taxes or governmental charges due in connection with delivery to the owners of the underlying securities. The trust also will terminate if Europe 2001 HOLDRS are delisted from the American Stock Exchange and are not listed for trading on another U.S. national securities exchange or through Nasdaq NMS within 5 business days from the date the Europe 2001 HOLDRS are delisted. Finally, the trust will 21 terminate if 75% of the owners of outstanding Europe 2001 HOLDRS other than Merrill Lynch, Pierce, Fenner & Smith Incorporated vote to dissolve and liquidate the trust. If a termination event occurs, the trustee will distribute the underlying securities to you as promptly as practicable after the termination event occurs. Amendment of the depositary trust agreement. The trustee and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as initial depositor, may amend any provisions of the depositary trust agreement without the consent of any other depositor or any of the owners of the Europe 2001 HOLDRS. Promptly after the execution of any amendment to the agreement, the trustee must furnish or cause to be furnished written notification of the substance of the amendment to each owner of Europe 2001 HOLDRS. Any amendment that imposes or increases any fees or charges, subject to exceptions, or that otherwise prejudices any substantial existing right of the owners of Europe 2001 HOLDRS will not become effective until 30 days after notice of the amendment is given to the owners of Europe 2001 HOLDRS. Issuance and cancellation fees. After the initial public offering, the trust expects to issue more Europe 2001 HOLDRS. If you wish to create Europe 2001 HOLDRS by delivering to the trust the requisite underlying securities, the trustee will charge you an issuance fee of up to $10.00 for each round-lot of 100 Europe 2001 HOLDRS. If you wish to cancel your Europe 2001 HOLDRS and withdraw your underlying securities, the trustee will charge you a cancellation fee of up to $10.00 for each round-lot of 100 Europe 2001 HOLDRS issued. The trustee may negotiate either of these fees depending on the volume, frequency and size of the issuance or cancellation transactions. Commissions. If you choose to create or cancel Europe 2001 HOLDRS after the conclusion of the initial public offering, you will not be charged the underwriting fee. However, in addition to the issuance and cancellation fees described above, you will be responsible for paying any sales commissions associated with your purchase of the underlying securities that are charged by your broker, whether it be any of the members of the selling group or another broker, in addition to the issuance or cancellation fee, as the case may be, described above. Custody fees. The Bank of New York, as trustee and as custodian, will charge you a quarterly custody fee of $2.00 for each round-lot of 100 Europe 2001 HOLDRS to be deducted from any dividend payments or other cash distributions on underlying securities received by the trustee. With respect to the aggregate custody fee payable in any calendar year for each Europe 2001 HOLDR, the Trustee will waive that portion of the fee which exceeds the total cash dividends and other cash distributions received, or to be received, and payable with respect to such calendar year. The trustee cannot recapture unpaid custody fees from prior years. Address of the trustee. The Bank of New York, ADR Department, 101 Barclay Street, New York, New York 10286. Governing law. The depositary trust agreement and Europe 2001 HOLDRS will be governed by the laws of the State of New York. The trustee will provide the depositary trust agreement to any owner of the underlying securities free of charge upon written request. Duties and immunities of the trustee. The trustee will assume no responsibility or liability for, and makes no representations as to, the validity or sufficiency, or as to the accuracy of the recitals, if any, set forth in the Europe 2001 HOLDRS. The trustee undertakes to perform only those duties as are specifically set forth in the depositary trust agreement. Subject to the preceding sentence, the trustee will be liable for its own negligence or misconduct except for good faith errors in judgment so long as the trustee was not negligent in ascertaining the relevant facts. 22 FEDERAL INCOME TAX CONSEQUENCES General The following is a summary of the U.S. federal income tax consequences relating to the Europe 2001 HOLDRS for: . a citizen or resident of the United States; . a corporation or partnership created or organized in the United States or under the laws of the United States; . an estate, the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; . a trust if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust (each of the above, a "U.S. receipt holder"); and . any person other than a U.S. receipt holder (a "non-U.S. receipt holder"). This summary is based upon laws, regulations, rulings and decisions currently in effect, all of which are subject to change, possibly on a retroactive basis. The discussion does not deal with all U.S. federal income tax consequences applicable to all categories of investors, some of which may be subject to special rules. In addition, this summary generally is limited to investors who will hold the Europe 2001 HOLDRS as "capital assets" (generally, property held for investment) within the meaning of section 1221 of the Internal Revenue Code of 1986, as amended. We recommend that you consult with your own tax advisor. Taxation of the trust The trust will provide for flow through tax consequences as it will be treated as a grantor trust or custodial arrangement for U.S. federal income tax purposes. Taxation of Europe 2001 HOLDRS A receipt holder purchasing and owning Europe 2001 HOLDRS will be treated, for U.S. federal income tax purposes, as directly owning a proportionate share of the underlying securities represented by Europe 2001 HOLDRS. Consequently, if there is a taxable cash distribution on an underlying security, a holder will recognize income with respect to the distribution at the time the distribution is received by the trustee, not at the time that the holder receives the cash distribution from the trustee. A receipt holder will determine its initial tax basis in each of the underlying securities by allocating the purchase price for the Europe 2001 HOLDRS among the underlying securities based on their relative fair market values at the time of purchase. Similarly, when a holder sells a receipt, it will determine the amount realized with respect to each security by allocating the sales price among the underlying securities based on their relative fair market values at the time of sale. A holder's gain or loss with respect to each security will be computed by subtracting its adjusted basis in the security from the amount realized on the security. With respect to purchases of Europe 2001 HOLDRS for cash in the secondary market, a receipt holder's aggregate tax basis in each of the underlying securities will be equal to the purchase price of the Europe 2001 HOLDRS. Similarly, with respect to sales of Europe 2001 HOLDRS for cash in the secondary market, the amount realized with respect to a sale of Europe 2001 HOLDRS will be equal to the aggregate amount realized with respect to each of the underlying securities. The distribution of any securities by the trust upon the surrender of Europe 2001 HOLDRS, the occurrence of a reconstitution event, or a termination event will not be a taxable event, except to the extent that 23 cash is distributed in lieu of fractional shares. The receipt holder's holding period with respect to the distributed securities will include the period that the holder held the securities through the trust. Brokerage fees and custodian fees The brokerage fee incurred in purchasing a receipt will be treated as part of the cost of the underlying securities. Accordingly, a holder includes this fee in its tax basis in the underlying securities. A holder will allocate the brokerage fee among the underlying securities using either a fair market value allocation or pro rata based on the number of shares of each underlying security. Similarly, the brokerage fee incurred in selling Europe 2001 HOLDRS will reduce the amount realized with respect to the underlying securities. A holder will be required to include in its income the full amount of dividends paid on the underlying securities, even though the depositary trust agreement provides that the custodian fees will be deducted directly from any dividends paid. These custodian fees will be treated as an expense incurred in connection with a holder's investment in the underlying securities and may be deductible. If a holder is an individual, estate or trust, however, the deduction of its share of custodian fees will be a miscellaneous itemized deduction that may be disallowed in whole or in part. Special considerations with respect to underlying securities of foreign issuers With respect to underlying securities of foreign issuers, the gross amount of any taxable cash distribution will not be eligible for the dividends received deduction generally allowed to corporate U.S. receipt holders. If a foreign issuer pays a dividend in a currency other than in U.S. dollars, the amount of the dividend for U.S. federal income tax purposes will be the U.S. dollar value (determined at the spot rate on the date of the payment) regardless of whether the payment is later converted into U.S. dollars. In this case, the U.S. receipt holder may recognize ordinary income or loss as a result of currency fluctuations between the date on which the dividend is paid and the date the dividend amount is converted into U.S. dollars. Subject to conditions and limitations, any foreign tax withheld on dividends may be deducted from taxable income or credited against a U.S. receipt holder's U.S. federal income tax liability. The limitation on foreign taxes eligible for the U.S. foreign tax credit is calculated separately with respect to specific classes of income. For this purpose, dividends distributed by a foreign issuer generally will constitute "passive income" or, in the case of some U.S. holders, "financial services income." For purposes of the U.S. foreign tax credit limitation, dividends received by a U.S. receipt holder with respect to an underlying security of a foreign issuer generally will be treated as foreign source income while any gain or loss recognized from the sale of such security generally will be treated as from sources within the United States. The rules relating to the determination of the foreign tax credit are complex and we recommend that U.S. receipt holders consult their own tax advisors to determine whether and to what extent a credit would be available. Dividends and distributions made by a foreign issuer may be subject to a withholding tax. Some foreign issuers have made arrangements through which holders of their American depositary shares or Global shares can apply for a refund of withheld taxes. With respect to these issuers, it is expected that holders of Europe 2001 HOLDRS will be able to use these arrangements to apply for a refund of withheld taxes. In some cases, however, the holders of Europe 2001 HOLDRS will have to independently apply to a foreign tax authority for a refund of withheld taxes. Additionally, special U.S. federal income tax rules apply to U.S. persons owning shares of a "passive foreign investment company" (a "PFIC"). To our knowledge, none of the foreign issuers of the underlying securities is currently a PFIC and none anticipate becoming a PFIC in the future, although no assurances can be made that the applicable tax law or other relevant circumstances will not change in a manner which affects the 24 PFIC determination. A foreign corporation generally will be classified as a PFIC for U.S. federal income tax purposes in any taxable year in which, after applying relevant look-through rules, either: . at least 75% of its gross income is "passive income;" or . on average at least 50% of the gross value of its assets is attributable to assets that produce "passive income" or are held for the production of passive income. Passive income for this purpose generally includes dividends, interest, royalties, rents, and gains from commodities and securities transactions. If a corporation were classified as a PFIC, a U.S. receipt holder could be subject to increased tax liability, possibly including an interest charge, upon the sale or other disposition of the Europe 2001 HOLDRS or of the underlying securities or upon the receipt of "excess distributions," unless the U.S. receipt holder elected to be taxed currently on its pro rata portion of the corporation's income, whether or not the income was distributed in the form of dividends or otherwise. Non-U.S. receipt holders A non-U.S. receipt holder generally will be subject to U.S. withholding tax at a rate of 30% or a lower rate as may be specified by an applicable tax treaty with respect to dividends received on underlying securities of U.S. issuers. However, if that income is effectively connected with a U.S. trade or business conducted by the holder or, where a tax treaty applies, is attributable to a permanent establishment maintained in the United States by the holder, then those dividends will be exempt from withholding tax, provided the holder complies with applicable certification and disclosure requirements. A non-U.S. receipt holder generally will not be subject to U.S. federal income or withholding tax with respect to dividends received on underlying securities of foreign issuers, unless that income is effectively connected with a U.S. trade or business conducted by the holder or, where a tax treaty applies, is attributable to a permanent establishment maintained in the United States by the holder. With respect to dividends of both U.S. and foreign issuers, a non-U.S. receipt holder's dividends that are effectively connected with a U.S. trade or business or dividends attributable to a permanent establishment, net of relevant deductions and credits, will be subject to U.S. federal income taxation at the same graduated rates applicable to U.S. persons. In addition to this graduated tax, effectively connected dividends or dividends attributable to a permanent establishment received by a corporate non-U.S. receipt holder may also be subject to a branch profits tax at a rate of 30% or a lower rate as may be specified by an applicable tax treaty. Under some circumstances, a non- U.S. receipt holder whose dividends are so effectively connected or attributable shall be entitled to a dividends received deduction equal to 70% or 80% of the amount of the dividend. A non-U.S. receipt holder that is eligible for a reduced rate of withholding tax pursuant to a tax treaty may obtain a refund of any excess amounts withheld by filing an appropriate claim for refund with the Internal Revenue Service. A non-U.S. receipt holder generally will not be subject to U.S. federal income or withholding tax with respect to gain recognized upon the sale or other disposition of Europe 2001 HOLDRS or of the underlying securities unless: . that gain is effectively connected with a U.S. trade or business conducted by the holder or, where a tax treaty applies, is attributable to a permanent establishment maintained in the United States by the holder, . in the case of any gain realized by an individual non-U.S. receipt holder, the holder is present in the United States for 183 days or more in the taxable year of the sale or other disposition and certain other conditions are met, or 25 . the underlying securities issuer is or has been a U.S. real property holding corporation for U.S. federal income tax purposes at any time during the shorter of the five-year period ending on the date of the disposition or the period during which the non-U.S. receipt holder held the common stock of such issuer and (a) the common stock is not considered to be "regularly traded on an established securities market" or (b) the non-U.S. receipt holder owned, actually or constructively, at any time during the shorter of the periods described above, more than 5% of the common stock of such issuer. Effectively connected or attributable gains generally will be subject to U.S. federal income taxation at the same graduated rates applicable to U.S. persons, and may, in the case of a corporate non-U.S. receipt holder, also be subject to the branch profits tax. We recommend that non-U.S. receipt holders consult their own tax advisors to determine whether any applicable tax treaties provide for different rules. The preceding discussion does not address all aspects of U.S. federal income taxation that may be relevant in light of a non-U.S. receipt holder's or an issuer's particular facts and circumstances. We recommend that investors consult their own tax advisors. Backup withholding tax, withholding tax and information reporting requirements Final U.S. Treasury Regulations relating to backup withholding, withholding and information reporting have been issued that modify certain rules with respect to payments made after December 31, 2000. Investors are urged to consult their own tax advisors regarding the application of the backup withholding, withholding and information reporting requirements, including the new regulations, with respect to their particular circumstances. ERISA CONSIDERATIONS Any plan fiduciary which proposes to have a plan acquire Europe 2001 HOLDRS should consult with its counsel with respect to the potential applicability of ERISA and the Internal Revenue Code to this investment and whether any exemption would be applicable and determine on its own whether all conditions have been satisfied. Moreover, each plan fiduciary should determine whether, under the general fiduciary standards of investment prudence and diversification, an acquisition of Europe 2001 HOLDRS is appropriate for the plan, taking into account the overall investment policy of the plan and the composition of the plan's investment portfolio. PLAN OF DISTRIBUTION In accordance with the depositary trust agreement, the trust will issue to Merrill Lynch, Pierce, Fenner & Smith Incorporated, and Merrill Lynch, Pierce, Fenner & Smith Incorporated will deposit the underlying securities to receive Europe 2001 HOLDRS. Merrill Lynch, Pierce, Fenner & Smith Incorporated, Robert W. Baird & Co. Incorporated, A.G. Edwards & Sons, Inc., First Union Securities, Inc., Legg Mason Wood Walker, Incorporated, Morgan Keegan & Company, Inc., Raymond James & Associates, Inc., Sutro & Co. Incorporated and Tucker Anthony Incorporated, the selling group, propose to offer the Europe 2001 HOLDRS to the public at the offering price set forth on the cover page of this prospectus, which includes an underwriting fee of 2%. Investors who purchase Europe 2001 HOLDRS through a fee-based brokerage account should consider that the underwriting fee is in addition to the fees charged in that account. We recommend that investors review the terms of their brokerage accounts for details on applicable charges. Merrill Lynch, Pierce, Fenner & Smith Incorporated will provide Europe 2001 HOLDRS to the other members of the selling group at the public offering price, as set forth on the cover page of this prospectus, less 26 a concession that is not in excess of %. The selling group may allow to certain dealers, and the dealers may reallow, a discount on sales of Europe 2001 HOLDRS not in excess of % of the public offering price as set forth on the cover page of this prospectus. We expect the trust to deliver the initial distribution of Europe 2001 HOLDRS against deposit of the underlying securities in New York, New York on , 2000. After the initial offering, the public offering price, concession and discount may be changed. The trust will continue to issue Europe 2001 HOLDRS in connection with deposits of underlying securities. This offering is being made in compliance with Conduct Rule 2810 of the National Association of Securities Dealers, Inc. Accordingly, sales will not be made to a discretionary account without the prior written approval of a purchaser of Europe 2001 HOLDRS. Members of the selling group and their affiliates have from time to time provided investment banking and other financial services to some of the issuers of the underlying securities and expect in the future to provide these services, for which they have received and will receive customary fees and commissions. They also may have served as counterparties in other transactions with some of the issuers of the underlying securities. Merrill Lynch, Pierce, Fenner & Smith Incorporated may use this prospectus, as updated from time to time, in connection with offers and sales related to market-making transactions in the Europe 2001 HOLDRS. Merrill Lynch, Pierce, Fenner & Smith Incorporated may act as principal or agent in these transactions. Market-making sales will be made at prices related to prevailing market prices at the time of sale. Merrill Lynch, Pierce, Fenner & Smith Incorporated has agreed to indemnify the trustee against some civil liabilities related to acts performed or not performed by the trustee in accordance with the depositary trust agreement or periodic reports filed or not filed with the SEC with respect to the Europe 2001 HOLDRS. Should a court determine not to enforce the indemnification provision, Merrill Lynch, Pierce, Fenner & Smith Incorporated also has agreed to contribute to payments the trustee may be required to make with respect to these liabilities. LEGAL MATTERS Legal matters, including the validity of the Europe 2001 HOLDRS, will be passed upon for Merrill Lynch, Pierce, Fenner & Smith Incorporated, the initial depositor and the underwriters, by Shearman & Sterling, New York, New York. Shearman & Sterling, as special U.S. tax counsel to the trust, also will render an opinion regarding the material federal income tax consequences relating to the Europe 2001 HOLDRS. WHERE YOU CAN FIND MORE INFORMATION Merrill Lynch, Pierce, Fenner & Smith Incorporated has filed a registration statement on Form S-1 with the SEC covering the Europe 2001 HOLDRS. While this prospectus is a part of the registration statement, it does not contain all the exhibits filed as part of the registration statement. You should consider reviewing the full text of those exhibits. The registration statement is available over the Internet at the SEC's Web site at http://www.sec.gov. You also may read and copy the registration statement at the SEC's public reference rooms in Washington, D.C., New York, New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for more information on the public reference rooms and their copy charges. Merrill Lynch, Pierce, Fenner & Smith Incorporated will not file any reports pursuant to the Exchange Act. The trust will file modified reports pursuant to the Exchange Act. Since the securities of the issuers of the underlying securities are registered under the Exchange Act, the issuers of the underlying securities are required to file periodically financial and other information specified by the SEC. For more information about the issuers of the underlying securities, information provided to or 27 filed with the SEC by the issuers of the underlying securities with respect to their registered securities can be inspected at the SEC's public reference facilities or accessed through the SEC's Web site referenced above. However, some of the issuers of the underlying securities may be considered foreign issuers. The requirements for filing periodic financial and other information for foreign issuers differ from that of domestic issuers. In particular, foreign issuers are not required to file quarterly reports with the SEC and are not required to file periodic financial and other information on EDGAR. Therefore, this information may not be accessible through the SEC's Web site. Information regarding the issuers of the underlying securities may also be obtained from other sources including, but not limited to, press releases, newspaper articles and other publicly disseminated information. The trust and the selling group and their affiliates are not affiliated with the issuers of the underlying securities, and the issuers of the underlying securities have no obligations with respect to Europe 2001 HOLDRS. This prospectus relates only to Europe 2001 HOLDRS and does not relate to the other securities of the issuers of the underlying securities. The information in this prospectus regarding the issuers of the underlying securities has been derived from the publicly available documents described in the preceding paragraph. We have not participated in the preparation of these documents or made any due diligence inquiries with respect to the issuers of the underlying securities in connection with Europe 2001 HOLDRS. We make no representation that these publicly available documents or any other publicly available information regarding the issuers of the underlying securities are accurate or complete. Furthermore, we cannot assure you that all events occurring prior to the date of this prospectus, including events that would affect the accuracy or completeness of the publicly available documents described in the preceding paragraph, that would affect the trading price of the securities of the issuers of the underlying securities, and therefore the offering and trading prices of the Europe 2001 HOLDRS have been publicly disclosed. 28 ANNEX A This annex forms an integral part of the prospectus. The following tables provide a brief description of the business of each of the issuers of the underlying securities and set forth the split-adjusted closing market prices, as reported on the applicable primary U.S. trading market, of each of the underlying securities in each month during 1995, 1996, 1997, 1998, 1999 and 2000 through November 2000. A table outlining the primary U.S. stock market on which the securities of the issuers are listed can be found on page 10. The foreign stock market or markets on which the equity securities of the foreign issuers included in the Europe 2001 HOLDRS, if any, are listed are described below. An asterisk (*) denotes that no shares of the issuer were trading on a U.S. stock market during that month. The historical prices of the underlying securities should not be taken as an indication of future performance. AEGON N.V. (AEG) AEGON N.V. is an international insurance and financial services company. AEGON provides life insurance, pension and related savings and investment products. AEGON is also involved in accident and health insurance, property and casualty insurance and it also has some banking activities. AEGON primarily operates in the United States, the United Kingdom, The Netherlands, Hungary and Spain. AEGON's products are offered through independent intermediaries and financial advisers, financial institutions, brokers, direct marketing and business partners. New York registered shares of AEGON included in the Europe 2001 HOLDRS are traded through the New York Stock Exchange. Shares of AEGON also trade on the Amsterdam, Frankfurt, London, Tokyo and Zurich stock exchanges.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 6.44 January 10.38 January 15.47 January 23.69 January 55.34 January 36.38 February 6.88 February 10.84 February 16.72 February 28.14 February 52.31 February 34.81 March 7.15 March 11.84 March 17.34 March 30.33 March 44.94 March 40.25 April 7.76 April 12.03 April 18.13 April 33.22 April 47.56 April 36.19 May 8.10 May 12.00 May 18.47 May 39.66 May 40.56 May 36.13 June 8.72 June 11.53 June 17.52 June 43.25 June 36.97 June 35.63 July 9.13 July 11.47 July 18.97 July 45.88 July 38.06 July 38.50 August 8.44 August 12.25 August 18.56 August 42.75 August 43.40 August 39.25 September 9.06 September 12.44 September 19.92 September 39.00 September 43.25 September 37.13 October 9.53 October 12.88 October 19.88 October 43.69 October 45.97 October 40.38 November 10.25 November 14.06 November 21.25 November 53.00 November 45.06 November 40.63 December 11.00 December 15.81 December 22.41 December 61.13 December 47.75
The closing price on , 2000 was . A-1 ALCATEL (ALA) Alcatel provides telecommunications equipment and systems. Alcatel's interaction management products are designed to extend the capabilities of a company's Internet, computer, telecommunications and database systems. American depositary receipts evidencing American depositary shares of Alcatel are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Alcatel also trade on the Paris, Amsterdam, Antwerp, Basel, Brussels, Frankfurt, Geneva, Stockholm, Tokyo and Zurich stock exchanges, as well as through the European Association of Securities Dealers Automated Quotation System.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 17.38 January 18.38 January 20.63 January 26.06 January 23.00 January 40.06 February 16.25 February 17.88 February 20.50 February 26.19 February 21.69 February 47.25 March 18.13 March 18.50 March 23.75 March 38.00 March 22.81 March 43.12 April 18.50 April 19.00 April 22.25 April 36.25 April 24.31 April 45.13 May 18.25 May 18.38 May 22.75 May 43.25 May 23.69 May 54.56 June 18.13 June 17.75 June 25.25 June 40.69 June 28.38 June 66.50 July 21.25 July 16.25 July 27.00 July 39.38 July 30.88 July 73.13 August 20.00 August 15.50 August 24.63 August 30.00 August 30.94 August 82.75 September 16.75 September 16.88 September 26.56 September 17.00 September 27.75 September 62.88 October 16.88 October 17.00 October 24.31 October 22.00 October 30.69 October 62.38 November 16.75 November 18.50 November 24.75 November 25.88 November 38.00 November 50.50 December 17.50 December 16.00 December 25.31 December 24.44 December 45.00
The closing price on , 2000 was . AMDOCS LIMITED (DOX) Amdocs Limited designs, develops, markets and supports information system software products and related services for the communications and Internet industries. Amdocs products are primarily related to customer care, billing and order management systems. Amdocs products support a range of communications services including wireline, wireless, cable television, broadband, electronic commerce and Internet services. Amdocs also offers a range of directory sales and publishing systems to publishers of both traditional yellow and white page directories and electronic Internet directories. Ordinary shares of Amdocs, included in the Europe 2001 HOLDRS, are traded through the New York Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January * January * January 21.75 January 53.19 February * February * February * February * February 24.38 February 74.19 March * March * March * March * March 21.63 March 74.00 April * April * April * April * April 26.88 April 67.69 May * May * May * May * May 22.94 May 61.94 June * June * June * June 15.13 June 22.75 June 76.75 July * July * July * July 13.69 July 26.63 July 67.19 August * August * August * August 9.00 August 26.25 August 71.44 September * September * September * September 11.31 September 21.00 September 62.38 October * October * October * October 13.00 October 27.88 October 64.81 November * November * November * November 15.38 November 35.19 November 54.13 December * December * December * December 17.13 December 34.50
The closing price on , 2000 was . A-2 ARM HOLDINGS P.L.C. (ARMHY) ARM Holdings p.l.c. designs microprocessors and related technology and software and sells development systems. ARM licenses and sells its technology and products to electronics companies. Its microprocessors are used in a variety of electronics products, including video games, automotive control systems and digital cellular phones. American depositary receipts evidencing American depositary shares of ARM are included in the Europe 2001 HOLDRS and are traded through the Nasdaq NMS. Shares of ARM also trade on the London International Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January * January * January 4.00 January 37.79 February * February * February * February * February 5.78 February 46.73 March * March * March * March * March 6.63 March 35.55 April * April * April * April 2.02 April 6.50 April 31.75 May * May * May * May 1.78 May 5.84 May 25.88 June * June * June * June 3.06 June 6.98 June 32.88 July * July * July * July 3.09 July 9.48 July 34.31 August * August * August * August 2.55 August 8.43 August 40.88 September * September * September * September 2.25 September 9.40 September 32.94 October * October * October * October 2.35 October 16.95 October 30.00 November * November * November * November 2.70 November 29.60 November 18.31 December * December * December * December 3.01 December 38.30
The closing price on , 2000 was . ASM INTERNATIONAL N.V. (ASMI) ASM International N.V. is engaged in the research, development, manufacture, marketing and servicing of equipment and materials used to produce semiconductor devices, including solutions for wafer processing, assembly and packaging. ASM's production equipment and solutions are used by both the front- end and back-end segments of the semiconductor market. Front-end equipment performs various fabrication processes to create the silicon wafer. Back-end equipment separates these processed wafers into numerous individual pieces and assembles, packages and tests the pieces to create semiconductor devices. New York registered shares of ASM included in the Europe 2001 HOLDRS are traded through the Nasdaq NMS. Shares of ASM also trade on the Amsterdam Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 1.50 January 12.08 January 15.31 January 10.16 January 5.69 January 25.25 February 1.67 February 12.33 February 13.63 February 12.19 February 5.00 February 32.63 March 3.50 March 9.25 March 11.50 March 11.13 March 3.63 March 29.00 April 3.71 April 13.75 April 13.13 April 11.06 April 4.69 April 34.50 May 6.21 May 13.50 May 13.00 May 9.75 May 5.19 May 25.88 June 8.58 June 10.88 June 10.94 June 8.00 June 7.44 June 26.50 July 10.67 July 6.13 July 13.75 July 8.38 July 8.00 July 26.00 August 16.25 August 7.00 August 13.13 August 5.81 August 7.38 August 25.13 September 16.83 September 9.63 September 20.13 September 4.50 September 8.38 September 17.50 October 15.63 October 8.50 October 12.06 October 4.00 October 8.41 October 16.06 November 16.83 November 10.25 November 10.56 November 5.50 November 16.25 November 11.38 December 16.42 December 9.63 December 8.69 December 5.25 December 23.00
The closing price on , 2000 was . A-3 ASM LITHOGRAPHY HOLDING N.V. (ASML) ASM Lithography Holding N.V. is a developer and supplier of microlithography systems. Microlithography is used in semiconductor manufacturing to transfer the pattern of circuitry from a photomask (a quartz plate containing the "master copy" of microscopic integrated circuitry) to a wafer (a thin slice of silicon or other semiconductor material on which chips are made). New York registered shares of ASM, included in the Europe 2001 HOLDRS, are traded through the Nasdaq NMS. Shares of ASM also trade through the Nasdaq NMS and on the Amsterdam Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January 3.73 January 6.09 January 11.58 January 15.50 January 40.98 February * February 4.04 February 5.54 February 15.56 February 13.21 February 42.71 March 2.34 March 3.36 March 6.25 March 15.41 March 15.00 March 37.25 April 2.28 April 3.69 April 6.63 April 15.27 April 13.00 April 40.00 May 2.69 May 3.94 May 8.71 May 12.77 May 14.71 May 35.56 June 2.99 June 3.42 June 9.75 June 9.69 June 19.79 June 44.13 July 4.67 July 3.15 July 13.50 July 9.56 July 20.25 July 39.75 August 3.93 August 3.21 August 14.17 August 5.88 August 21.04 August 38.13 September 3.66 September 3.17 September 16.46 September 5.23 September 22.35 September 32.31 October 4.14 October 3.00 October 12.21 October 8.50 October 24.21 October 27.81 November 3.51 November 3.68 November 10.42 November 9.44 November 31.21 November 20.44 December 2.77 December 4.15 December 11.25 December 10.17 December 37.92
The closing price on , 2000 was . ASTRAZENECA P.L.C. (AZN) AstraZeneca p.l.c. is a biosciences company involved in the research, development, manufacture and marketing of pharmaceutical, agricultural and specialty chemical products and the supply of healthcare services. AstraZeneca's research and products focus on several areas, including cancer, cardiovascular, the central nervous system, gastrointestinal, infection, pain control, anesthesia and respiratory. American depositary receipts evidencing American depositary shares of AstraZeneca are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of AstraZeneca also trade on the London International Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 13.96 January 19.46 January 28.75 January 39.69 January 47.00 January 38.00 February 13.79 February 19.17 February 29.33 February 44.31 February 41.06 February 33.13 March 14.13 March 21.25 March 28.33 March 43.83 March 47.06 March 40.50 April 14.54 April 20.92 April 30.13 April 43.88 April 39.25 April 42.13 May 15.00 May 21.38 May 30.54 May 41.38 May 39.38 May 42.06 June 17.08 June 22.42 June 33.08 June 43.88 June 39.19 June 46.50 July 17.79 July 21.58 July 33.29 July 38.81 July 36.75 July 42.75 August 17.25 August 24.04 August 31.83 August 36.50 August 39.38 August 45.56 September 18.17 September 24.75 September 32.54 September 35.00 September 42.25 September 52.56 October 18.79 October 27.17 October 31.79 October 39.13 October 45.75 October 47.69 November 20.38 November 27.67 November 32.06 November 42.00 November 44.50 November 51.44 December 19.46 December 28.00 December 36.00 December 44.88 December 41.75
The closing price on , 2000 was . A-4 AUTONOMY CORPORATION P.L.C. (AUTN) Autonomy Corporation p.l.c. develops and markets software for automating the management, processing and delivery of information to and from sources across the Internet and other digital mediums, such as mobile phones. Autonomy's software products allow for the automation of a range of tasks, such as categorizing information by subject matter, inserting hypertext links to related material and profiling users of the Internet, which enables the automatic delivery of large volumes of personalized information. American depositary receipts evidencing American depositary shares of Autonomy are included in the Europe 2001 HOLDRS and are traded through Nasdaq NMS. Shares of Autonomy also trade through the European Association of Securities Dealers Automated Quotation System.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January * January * January * January * February * February * February * February * February * February * March * March * March * March * March * March * April * April * April * April * April * April * May * May * May * May * May * May 35.50 June * June * June * June * June * June 41.00 July * July * July * July * July * July 48.00 August * August * August * August * August * August 63.00 September * September * September * September * September * September 55.00 October * October * October * October * October * October 50.00 November * November * November * November * November * November 32.94 December * December * December * December * December *
The closing price on , 2000 was . AVENTIS S.A. (AVE) Aventis S.A. develops, manufactures and markets products and services related to the health and nutrition industry. Aventis is primarily involved in the fields of prescription drugs, vaccines, therapeutic proteins, diagnostics, crop sciences and animal health and nutrition. American depositary receipts evidencing American depositary shares of Aventis are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Aventis also trade on the Paris Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 24.25 January 24.00 January 33.38 January 46.13 January 51.69 January 54.00 February 23.88 February 25.25 February 35.00 February 46.19 February 46.00 February 52.00 March 23.50 March 25.88 March 33.25 March 50.38 March 44.00 March 54.00 April 24.13 April 24.13 April 33.88 April 49.50 April 47.13 April 56.25 May 24.13 May 24.63 May 32.25 May 55.00 May 46.88 May 63.94 June 22.00 June 26.50 June 41.63 June 56.19 June 46.31 June 72.56 July 23.00 July 26.13 July 43.13 July 54.00 July 48.38 July 75.50 August 20.75 August 26.38 August 37.88 August 46.00 August 48.56 August 74.75 September 20.25 September 28.00 September 40.44 September 41.75 September 51.25 September 75.31 October 22.00 October 29.75 October 42.25 October 46.69 October 55.50 October 72.06 November 21.75 November 32.38 November 44.88 November 50.00 November 61.56 November 78.44 December 21.38 December 33.88 December 44.19 December 50.25 December 56.88
The closing price on , 2000 was . A-5 AXA FINANCIAL, INC. (AXA) AXA Financial, Inc. is a financial services company that focuses on insurance and asset management. AXA provides life, property and casualty insurance and reinsurance. AXA's primary operations are in western Europe, North America and the Asia-Pacific region. AXA is engaged in investment banking in the United States. American depositary receipts evidencing American depositary shares of AXA are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of AXA also trade on the Paris Stock Exchange and the London International Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January 33.50 January 41.19 January 73.00 January 64.81 February * February * February 33.63 February 48.38 February 66.50 February 62.94 March * March * March 32.75 March 51.75 March 66.25 March 71.69 April * April * April 31.00 April 58.13 April 63.94 April 76.75 May * May * May 31.63 May 57.38 May 58.50 May 73.25 June * June 27.13 June 31.63 June 56.81 June 62.31 June 79.56 July * July 27.13 July 32.88 July 67.44 July 59.06 July 75.75 August * August 28.38 August 31.94 August 54.31 August 62.63 August 70.31 September * September 29.75 September 33.94 September 44.50 September 63.81 September 64.69 October * October 31.13 October 34.31 October 56.88 October 69.75 October 66.44 November * November 30.38 November 35.75 November 64.13 November 66.81 November 70.00 December * December 31.50 December 39.00 December 72.25 December 71.00
The closing price on , 2000 was . BOOKHAM TECHNOLOGY P.L.C. (BKHM) Bookham Technology p.l.c. provides integrated optical circuits and modules to telecommunications and network systems. Bookham designs, manufactures and markets components based on silicon chips that generate, detect, route and control light signals in fiber-optic telecommunication networks. American depositary receipts evidencing American depositary shares of Bookham are included in the Europe 2001 HOLDRS and are traded through Nasdaq NMS. Shares of Bookham also trade on the London International Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January * January * January * January * February * February * February * February * February * February * March * March * March * March * March * March * April * April * April * April * April * April 52.00 May * May * May * May * May * May 48.69 June * June * June * June * June * June 59.25 July * July * July * July * July * July 62.75 August * August * August * August * August * August 61.75 September * September * September * September * September * September 42.88 October * October * October * October * October * October 33.69 November * November * November * November * November * November 12.44 December * December * December * December * December *
The closing price on , 2000 was . A-6 BP AMOCO P.L.C. (BP) BP Amoco p.l.c. develops and markets oil and petroleum products throughout the world and is involved in exploration, oil field development and the manufacture of petroleum-based chemical products. BP Amoco's main businesses include oil and natural gas exploration, pipeline transportation, gas processing and gas marketing, oil supply and trading, refining and marketing and petrochemical manufacturing and marketing. American depositary receipts evidencing American depositary shares of BP Amoco are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of BP Amoco also trade on the London International Stock Exchange and on the French, German, Swiss and Japanese Stock Exchanges.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 19.41 January 24.41 January 35.41 January 40.16 January 40.56 January 53.75 February 19.13 February 25.09 February 33.09 February 41.34 February 42.50 February 47.06 March 20.94 March 26.56 March 34.31 March 43.03 March 50.50 March 53.25 April 21.53 April 27.31 April 34.41 April 47.25 April 56.59 April 51.00 May 21.34 May 26.34 May 36.22 May 44.22 May 53.59 May 54.56 June 21.41 June 26.72 June 37.44 June 44.13 June 54.25 June 56.56 July 22.69 July 27.47 July 41.22 July 40.13 July 57.94 July 52.31 August 22.53 August 29.44 August 42.31 August 36.56 August 55.92 August 55.25 September 22.47 September 31.25 September 45.41 September 43.59 September 55.41 September 53.00 October 22.06 October 32.16 October 43.88 October 44.25 October 57.75 October 50.94 November 23.91 November 34.63 November 41.50 November 46.06 November 60.94 November 47.44 December 25.53 December 35.34 December 39.84 December 45.38 December 59.31
The closing price on , 2000 was . BUSINESS OBJECTS S.A. (BOBJ) Business Objects S.A. develops, markets and supports electronic commerce software and services for client-server environments, intranets, extranets and the Internet. Business Objects' software allows users to access, analyze and share data in various business environments. American depositary receipts evidencing American depositary shares of Business Objects are included in the Europe 2001 HOLDRS and are traded through Nasdaq NMS. Shares of Business Objects also trade on the Paris Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 7.56 January 11.50 January 7.19 January 4.78 January 17.25 January 67.31 February 7.53 February 18.69 February 5.84 February 7.06 February 18.13 February 114.88 March 7.88 March 21.25 March 4.88 March 7.56 March 14.84 March 99.50 April 7.94 April 21.63 April 4.50 April 9.44 April 11.72 April 97.88 May 7.69 May 23.25 May 4.81 May 8.45 May 14.38 May 80.00 June 8.25 June 20.13 June 4.88 June 8.44 June 18.25 June 88.13 July 9.09 July 9.63 July 3.38 July 7.44 July 22.56 July 94.50 August 9.00 August 8.88 August 3.94 August 4.44 August 22.31 August 114.50 September 10.66 September 9.63 September 5.06 September 6.25 September 29.50 September 113.06 October 10.81 October 7.44 October 6.31 October 8.41 October 36.00 October 78.80 November 12.19 November 6.63 November 5.44 November 9.50 November 44.25 November 61.88 December 12.09 December 6.75 December 5.19 December 16.25 December 66.81
The closing price on , 2000 was . A-7 CABLE & WIRELESS P.L.C. (CWP) Cable & Wireless p.l.c. provides integrated communications and a global carrier of communications traffic, including Internet, data, voice and video communications. Cable & Wireless also offers broadband data, cable television and fixed and mobile voice services. Cable & Wireless primarily operates in North America, Europe and the Asia-Pacific region. American depositary receipts evidencing American depositary shares of Cable & Wireless are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Cable & Wireless also trade on The London International Stock Exchange and on the Frankfurt Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 17.50 January 20.25 January 22.50 January 29.06 January 43.25 January 63.25 February 18.00 February 20.25 February 24.25 February 33.25 February 40.56 February 64.63 March 18.88 March 24.25 March 23.75 March 37.75 March 36.94 March 56.00 April 19.38 April 23.38 April 23.13 April 35.13 April 42.13 April 49.38 May 20.50 May 20.63 May 25.13 May 34.69 May 38.25 May 49.63 June 20.50 June 19.75 June 27.94 June 36.88 June 39.63 June 50.06 July 20.13 July 18.88 July 30.06 July 38.88 July 36.00 July 52.56 August 19.63 August 19.75 August 26.63 August 28.38 August 34.63 August 55.25 September 19.75 September 20.88 September 25.88 September 27.13 September 33.13 September 42.56 October 19.38 October 23.75 October 24.50 October 33.63 October 34.88 October 43.06 November 20.63 November 24.13 November 26.94 November 37.75 November 39.75 November 37.00 December 21.13 December 24.63 December 27.19 December 36.75 December 52.94
The closing price on , 2000 was . DAIMLERCHRYSLER AG (DCX) DaimlerChrysler AG develops, manufactures and markets passenger cars, commercial vehicles, rail systems, automotive electronics and diesel engines. DaimlerChrysler also offers financial and information technology services. Global shares of DaimlerChrysler, included in the Europe 2001 HOLDRS, trade on the New York Stock Exchange. Shares of DaimlerChrysler also trade on the Frankfurt, Berlin, Bremen, Dusseldorf, Hamburg, Hanover, Munich, Stuttgart, Chicago, Pacific, Philadelphia, Montreal, Paris, Tokyo, Toronto and Swiss Stock Exchanges.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 45.65 January 55.10 January 71.89 January 69.59 January 103.63 January 65.81 February 48.26 February 54.97 February 72.14 February 80.72 February 93.94 February 67.75 March 44.53 March 53.85 March 76.86 March 92.41 March 85.81 March 65.44 April 45.89 April 54.35 April 74.00 April 100.50 April 98.19 April 57.56 May 48.38 May 54.23 May 78.85 May 98.38 May 87.44 May 53.94 June 45.89 June 53.61 June 81.09 June 96.83 June 89.00 June 52.06 July 48.38 July 53.73 July 83.27 July 100.99 July 72.13 July 52.69 August 49.25 August 54.23 August 74.38 August 84.58 August 75.19 August 52.06 September 49.38 September 54.97 September 81.71 September 81.53 September 69.44 September 44.39 October 48.01 October 58.95 October 68.10 October 78.42 October 77.75 October 45.90 November 49.25 November 65.30 November 70.27 November 91.50 November 68.13 November 38.44 December 50.62 December 68.16 December 71.89 December 96.06 December 78.00
The closing price on , 2000 was . A-8 DEUTSCHE TELEKOM AG (DT) Deutsche Telekom AG is a full-service telecommunications company that provides public fixed-line voice telephony, mobile communications and cable television and radio programming primarily in Germany and in parts of Europe. Deutsche Telekom also offers some of these services outside of Europe. Deutsche Telekom operates T-Online, an Internet service provider in Europe, and also provides leased lines, text and data services, corporate network services and telephone directory assistance. American depositary receipts evidencing American depositary shares of Deutsche Telekom are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Deutsche Telekom also trade on the Frankfurt, Berlin, Bremen, Dusseldorf, Hamburg, Hanover, Munich, Stuttgart, and Tokyo stock exchanges.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January 18.63 January 17.50 January 45.25 January 69.63 February * February * February 19.38 February 20.00 February 45.63 February 84.31 March * March * March 21.88 March 22.06 March 40.44 March 80.25 April * April * April 21.50 April 26.31 April 38.75 April 67.50 May * May * May 22.75 May 27.25 May 39.56 May 61.75 June * June * June 24.13 June 27.50 June 42.25 June 56.75 July * July * July 23.38 July 29.56 July 40.44 July 43.50 August * August * August 20.06 August 24.00 August 44.38 August 38.94 September * September * September 19.06 September 29.44 September 41.81 September 34.25 October * October * October 19.44 October 27.25 October 46.00 October 38.19 November * November 21.38 November 20.44 November 28.31 November 56.88 November 32.31 December * December 20.38 December 18.63 December 32.75 December 71.00
The closing price on , 2000 was . DIAGEO P.L.C. (DEO) Diageo p.l.c. develops, markets and distributes a wide range of consumer goods, including spirits, wine and beer, food products through a variety of brands, including Smirnoff, Guinness, Pillsbury, Haagen-Dazs and Burger King, and quick service restaurants. American depositary receipts evidencing American depositary shares of Diageo are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Diageo also trade on the London International Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 23.50 January 26.88 January 30.13 January 36.44 January 45.06 January 30.19 February 24.50 February 27.00 February 30.00 February 41.56 February 45.25 February 30.81 March 25.75 March 26.25 March 31.88 March 48.56 March 45.75 March 30.13 April 25.88 April 26.63 April 34.25 April 48.06 April 46.25 April 34.00 May 25.25 May 26.88 May 37.38 May 45.25 May 43.00 May 34.56 June 25.00 June 26.75 June 39.19 June 48.00 June 43.00 June 35.56 July 24.25 July 27.25 July 40.00 July 48.38 July 41.00 July 34.81 August 25.75 August 29.00 August 36.38 August 37.81 August 41.44 August 34.44 September 28.00 September 30.50 September 39.00 September 36.25 September 41.44 September 35.31 October 27.50 October 30.63 October 37.38 October 43.94 October 40.63 October 37.63 November 27.13 November 31.88 November 37.25 November 45.69 November 36.81 November 41.75 December 28.75 December 31.63 December 37.88 December 46.25 December 32.00
The closing price on , 2000 was . A-9 ELAN CORPORATION, P.L.C. (ELN) Elan Corporation, p.l.c. is a pharmaceutical company focused on the discovery, development and marketing of therapeutic products and services in neurology, acute care and pain management and on the development and commercialization of products using its drug delivery technologies. Elan's drug delivery technologies are designed to improve and control the absorption and utilization of active pharmaceutical compounds. American depositary receipts evidencing American depositary shares of Elan are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Elan also trade on the London International Stock Exchange and Dublin Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 8.81 January 14.50 January 19.25 January 25.97 January 33.75 January 30.06 February 8.81 February 14.53 February 17.31 February 31.03 February 38.34 February 40.75 March 9.31 March 16.06 March 17.06 March 32.31 March 34.88 March 47.50 April 8.84 April 16.47 April 17.00 April 31.06 April 25.81 April 43.50 May 8.72 May 15.69 May 20.38 May 30.59 May 27.03 May 39.81 June 10.22 June 14.31 June 22.63 June 32.16 June 27.75 June 48.44 July 10.56 July 14.69 July 23.75 July 36.00 July 29.06 July 53.44 August 9.81 August 15.69 August 22.75 August 29.47 August 32.06 August 58.31 September 10.25 September 14.94 September 25.03 September 36.03 September 33.56 September 54.75 October 10.03 October 13.88 October 24.94 October 35.03 October 25.75 October 51.94 November 12.03 November 14.88 November 26.38 November 34.06 November 27.31 November 53.94 December 12.16 December 16.63 December 25.59 December 34.97 December 29.50
The closing price on , 2000 was . LM ERICSSON TELEPHONE COMPANY (ERICY) LM Ericsson Telephone Company is an international manufacturer of advanced systems and products for wireline and wireless communications. Ericsson's range of telecommunication and data communication products includes systems and services for handling voice, data, images and text in public and private wireline and wireless communications networks, power equipment and defense system electronics and telecommunications. American depositary receipts evidencing American depositary shares of Ericsson are included in the Europe 2001 HOLDRS and are traded through Nasdaq NMS. Shares of Ericsson also trade on the Stockholm Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 1.68 January 2.58 January 4.21 January 4.83 January 6.97 January 18.64 February 1.78 February 2.75 February 3.94 February 5.66 February 6.50 February 24.00 March 1.93 March 2.67 March 4.23 March 5.95 March 5.95 March 23.45 April 2.10 April 2.55 April 4.20 April 6.43 April 6.75 April 22.11 May 2.29 May 2.88 May 4.45 May 6.97 May 6.73 May 20.50 June 2.50 June 2.69 June 4.92 June 7.16 June 8.23 June 20.00 July 2.33 July 2.54 July 5.66 July 6.92 July 8.02 July 19.63 August 2.67 August 2.88 August 5.21 August 5.36 August 8.14 August 20.50 September 3.06 September 3.17 September 5.99 September 4.59 September 7.81 September 14.81 October 2.67 October 3.45 October 5.53 October 5.66 October 10.69 October 13.88 November 2.97 November 3.86 November 5.05 November 6.91 November 12.05 November 11.38 December 2.44 December 3.77 December 4.66 December 5.98 December 16.42
The closing price on , 2000 was . A-10 GLAXO WELLCOME P.L.C. (GLX) GlaxoWellcome p.l.c. is an international pharmaceutical company that develops, manufactures and markets prescription and non-prescription medicines. GlaxoWellcome's products are grouped into the therapeutic areas of respiratory, bacterial infections, viral infections, neurology and psychiatry, gastrointestinal, cancer, cardiovascular, dermatologicals and anesthesia. On January 17, 2000, GlaxoWellcome announced that it had entered into a merger agreement with SmithKline Beecham p.l.c. This transaction is subject to regulatory approval and customary closing conditions. American depositary receipts evidencing American depositary shares of Glaxo Wellcome are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Glaxo Wellcome also trade on the London International Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 19.63 January 29.13 January 31.88 January 53.81 January 67.88 January 52.75 February 20.00 February 27.38 February 33.88 February 54.31 February 64.06 February 48.75 March 22.88 March 25.00 March 35.38 March 54.13 March 66.94 March 57.31 April 23.63 April 24.25 April 39.38 April 56.56 April 58.00 April 62.81 May 23.13 May 26.13 May 40.25 May 53.94 May 56.25 May 56.31 June 24.38 June 26.75 June 41.81 June 59.81 June 56.63 June 57.81 July 23.88 July 27.75 July 42.50 July 60.81 July 52.19 July 57.13 August 23.75 August 28.50 August 39.94 August 55.38 August 52.94 August 57.56 September 24.13 September 31.13 September 44.94 September 57.13 September 52.00 September 60.44 October 27.00 October 31.50 October 42.58 October 62.25 October 59.88 October 58.19 November 26.63 November 32.88 November 45.69 November 63.50 November 59.44 November 57.31 December 28.13 December 31.75 December 47.88 December 69.50 December 55.88
The closing price on , 2000 was . INFINEON TECHNOLOGIES AG (IFX) Infineon Technologies AG designs, develops, manufactures and markets a broad range of semiconductors and complete system solutions for the automotive and industrial electronics industries. Infineon produces chips for wireless communications, security and chip card applications and communications and multimedia chips and memory components. American depositary receipts evidencing American depositary shares of Infineon are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Infineon also trade on the Frankfurt Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January * January * January * January * February * February * February * February * February * February * March * March * March * March * March * March 57.50 April * April * April * April * April * April 67.88 May * May * May * May * May * May 62.88 June * June * June * June * June * June 79.25 July * July * July * July * July * July 68.00 August * August * August * August * August * August 65.94 September * September * September * September * September * September 47.50 October * October * October * October * October * October 42.88 November * November * November * November * November * November 38.38 December * December * December * December * December *
The closing price on , 2000 was . A-11 ING GROEP N.V. (ING) ING Groep N.V. provides a range of insurance services, retail, commercial and investment banking services, asset management services and other related products and services. American depositary receipts evidencing American depositary shares of ING are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of ING also trade on the Amsterdam, Brussels, Frankfurt, Paris and Swiss Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 18.76 January 26.04 January 37.70 January 45.63 January 59.19 January 51.06 February 19.50 February 26.57 February 38.71 February 53.19 February 55.94 February 51.56 March 19.90 March 29.05 March 39.40 March 56.94 March 54.94 March 55.00 April 21.12 April 30.84 April 39.27 April 67.25 April 61.38 April 54.94 May 21.66 May 32.86 May 44.25 May 68.25 May 53.63 May 60.31 June 22.11 June 29.82 June 46.38 June 65.38 June 55.00 June 67.50 July 23.10 July 30.67 July 49.19 July 74.88 July 50.88 July 67.25 August 22.23 August 31.21 August 44.06 August 54.50 August 54.88 August 67.44 September 23.33 September 31.21 September 45.94 September 43.88 September 54.75 September 65.88 October 23.82 October 31.19 October 41.63 October 49.38 October 59.13 October 69.19 November 26.21 November 35.02 November 40.75 November 56.38 November 56.50 November 71.75 December 26.75 December 35.96 December 42.31 December 62.19 December 61.00
The closing price on , 2000 was . IONA TECHNOLOGIES P.L.C. (IONA) IONA Technologies p.l.c. provides software products that create enterprise portals or singular points of access on the Web. IONA's products enable companies to develop, integrate and manage network based applications. IONA also provides consulting, training and technical support. American depositary receipts evidencing American depositary shares of IONA are included in the Europe 2001 HOLDRS and are traded through the Nasdaq NMS. Shares of IONA also trade on the Irish Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January * January 18.50 January 44.75 January 47.50 February * February * February 20.13 February 29.50 February 38.00 February 84.75 March * March * March 18.00 March 31.63 March 30.38 March 74.00 April * April * April 14.50 April 31.13 April 17.00 April 56.81 May * May * May 17.25 May 30.75 May 16.44 May 43.69 June * June * June 19.75 June 35.50 June 15.88 June 63.00 July * July * July 20.06 July 30.13 July 15.63 July 70.25 August * August * August 17.25 August 19.75 August 12.75 August 83.31 September * September * September 13.88 September 18.75 September 12.88 September 69.50 October * October * October 15.81 October 26.50 October 21.38 October 65.75 November * November * November 19.94 November 27.13 November 34.00 November 52.94 December * December * December 20.50 December 38.00 December 54.50
The closing price on , 2000 was . A-12 JAZZTEL P.L.C. (JAZZ) Jazztel p.l.c. is a telecommunications and Internet service provider in Spain and Portugal that focuses on small and medium-sized businesses. Jazztel is currently constructing a fiber-optic telecommunications network that it believes will be the first competitive local exchange carrier in Spain and Portugal. American depositary receipts evidencing American depositary shares of Jazztel are included in the Europe 2001 HOLDRS and are traded through Nasdaq NMS. Shares of Jazztel also trade through the European Association of Securities Dealers Automated Quotation System and on the Madrid Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January * January * January * January 65.38 February * February * February * February * February * February 117.75 March * March * March * March * March * March 80.94 April * April * April * April * April * April 52.00 May * May * May * May * May * May 39.06 June * June * June * June * June * June 26.25 July * July * July * July * July * July 29.50 August * August * August * August * August * August 30.88 September * September * September * September * September * September 22.50 October * October * October * October * October * October 17.69 November * November * November * November * November * November 11.00 December * December * December * December * December 65.13
The closing price on , 2000 was . KONINKLIJKE PHILIPS ELECTRONICS N.V. (PHG) Koninklijke Philips Electronics N.V. develops, manufactures and markets products and services in the areas of lighting, consumer electronics and communications, domestic appliances and personal care, semiconductors, medical systems, business electronics and information technology. The transaction is subject to customary regulatory approvals and other closing conditions. New York registered shares of Philips Electronics, included in the Europe 2001 HOLDRS, trade on the New York Stock Exchange. Shares of Philips also trade on the London International Stock Exchange and on the Amsterdam, Paris, Zurich, Geneva, Basel, Frankfurt, Luxembourg, Brussels, Vienna and Antwerp Stock Exchanges.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 8.82 January 11.24 January 11.21 January 18.66 January 20.40 January 38.08 February 9.21 February 11.59 February 12.61 February 21.82 February 19.51 February 49.35 March 9.56 March 10.19 March 12.43 March 20.57 March 23.09 March 44.15 April 10.79 April 10.05 April 14.99 April 25.25 April 23.85 April 46.00 May 11.24 May 9.84 May 15.69 May 26.65 May 24.13 May 45.55 June 11.98 June 9.14 June 20.14 June 23.78 June 26.00 June 48.97 July 13.80 July 9.28 July 22.92 July 22.88 July 26.06 July 46.33 August 12.61 August 9.49 August 20.07 August 16.79 August 26.50 August 49.31 September 13.66 September 10.05 September 23.53 September 14.95 September 26.03 September 42.50 October 10.82 October 9.88 October 21.96 October 15.48 October 26.79 October 39.94 November 10.96 November 11.38 November 18.77 November 17.74 November 30.80 November 32.81 December 10.05 December 11.21 December 16.95 December 18.96 December 34.79
The closing price on , 2000 was . A-13 KPNQWEST N.V. (KQIP) KPNQwest N.V. is a facilities-based, European Internet service provider. KPNQwest is currently deploying fiber-optic network connecting 50 cities throughout Europe, and provides a full portfolio of Internet protocol based services. New York registered shares of KPNQwest, included in the Europe 2001 HOLDRS, trade on the Nasdaq NMS. Shares of KPNQwest also trade on Amsterdam Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January * January * January * January 63.63 February * February * February * February * February * February 72.50 March * March * March * March * March * March 54.25 April * April * April * April * April * April 40.25 May * May * May * May * May * May 34.75 June * June * June * June * June * June 39.63 July * July * July * July * July * July 33.50 August * August * August * August * August * August 33.19 September * September * September * September * September * September 29.00 October * October * October * October * October * October 24.63 November * November * November * November * November 38.25 November 18.63 December * December * December * December * December 63.75
The closing price on , 2000 was . MILLICOM INTERNATIONAL CELLULAR S.A. (MICC) Millicom International Cellular S.A. is involved in the telecommunications sector through investments in cellular telephone service operations, primarily in emerging markets. Millicom also offers broadband communications, fixed and mobile telephony, data network and Internet services. American depositary receipts evidencing New York registered shares of Millicom, included in the Europe 2001 HOLDRS, are traded through Nasdaq NMS. Shares of Millicom also trade on the Luxembourg Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 26.00 January 39.00 January 36.75 January 37.75 January 35.00 January 71.38 February 27.25 February 37.88 February 38.50 February 44.13 February 26.75 February 71.00 March 26.50 March 43.25 March 41.38 March 44.00 March 26.00 March 57.06 April 24.88 April 47.25 April 45.50 April 39.13 April 34.50 April 53.50 May 24.88 May 48.13 May 45.38 May 38.88 May 36.00 May 42.50 June 29.63 June 47.63 June 47.75 June 43.75 June 31.50 June 35.00 July 29.50 July 38.75 July 56.50 July 46.75 July 30.63 July 44.13 August 29.50 August 39.75 August 51.00 August 31.13 August 25.38 August 44.19 September 32.13 September 40.38 September 52.25 September 24.63 September 28.44 September 35.56 October 33.00 October 39.75 October 42.00 October 33.38 October 33.75 October 30.75 November 30.50 November 37.88 November 37.25 November 33.38 November 47.00 November 22.50 December 30.50 December 32.13 December 37.63 December 34.88 December 62.38
The closing price on , 2000 was . A-14 NOKIA CORP. (NOK) Nokia Corp. is a leading manufacturer of wireless telephones and a supplier of wireless and wireline network products and services to telecommunications operators and Internet service providers. Nokia telecommunication products include wireless telephones using major digital and analog standards and network access, switching and management systems. Nokia also develops and markets digital satellite, cable and land-based television receivers for broadcast and multimedia applications. American depositary receipts evidencing American depositary shares of Nokia are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Nokia also trade on the Helsinki, Frankfurt, Paris, Stockholm and London Stock Exchanges.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 2.29 January 2.34 January 4.19 January 4.75 January 18.02 January 46.00 February 2.35 February 2.18 February 3.66 February 6.30 February 16.95 February 50.88 March 2.30 March 2.14 March 3.64 March 6.75 March 19.47 March 55.50 April 2.56 April 2.28 April 4.04 April 8.36 April 18.55 April 57.25 May 2.91 May 2.72 May 4.13 May 8.12 May 17.81 May 52.00 June 3.74 June 2.31 June 4.61 June 9.09 June 22.89 June 49.94 July 4.13 July 2.20 July 5.35 July 10.91 July 21.27 July 44.31 August 4.33 August 2.64 August 4.84 August 8.35 August 20.91 August 44.94 September 4.36 September 2.77 September 5.86 September 9.78 September 22.47 September 39.81 October 3.48 October 2.90 October 5.52 October 11.63 October 28.89 October 42.75 November 3.39 November 3.51 November 5.20 November 12.25 November 34.50 November 42.75 December 2.44 December 3.60 December 4.34 December 15.05 December 47.77
The closing price on , 2000 was . NOVARTIS AG (NVS) Novartis AG is a pharmaceutical company that is primarily involved in healthcare, agriculture and nutrition. Novartis develops and sells prescription medicines and offers over-the-counter medicines such as Maalox and Thera Flu and also offers the CIBA Vision brand of contact lenses and related products. Novartis also develops products for sustainable agriculture and provides pharmaceuticals for animal health. American depositary receipts evidencing American depositary shares of Novartis are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Prior to listing on the New York Stock Exchange on May 11, 2000, Novartis' American depositary receipts were traded in the United States in the over-the-counter market. Shares of Novartis also trade on the Swiss Stock Exchange and the London International Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January 28.62 January 42.86 January 46.78 January 30.86 February * February * February 28.58 February 45.60 February 43.86 February 31.83 March * March * March 30.99 March 44.24 March 40.55 March 34.19 April * April * April 32.95 April 41.34 April 36.67 April 35.01 May * May * May 33.93 May 42.40 May 36.36 May 36.88 June * June * June 40.02 June 41.60 June 36.51 June 40.00 July * July * July 40.13 July 42.17 July 36.07 July 38.56 August * August * August 35.51 August 38.87 August 35.97 August 37.81 September * September * September 38.39 September 40.07 September 37.09 September 38.69 October * October * October 39.26 October 45.05 October 37.41 October 38.38 November * November * November 39.95 November 47.07 November 38.96 November 40.56 December * December 28.54 December 40.62 December 49.15 December 36.51
The closing price on , 2000 was . A-15 QIAGEN N.V. (QGENF) QIAGEN N.V. produces and distributes biotechnology products for the separation, purification and handling of nucleic acids, which are used in drug screening and the development of genetic vaccinations. QIAGEN's products are sold to academic research markets and to leading pharmaceutical and biotechnology companies. QIAGEN also assembles and distributes robotic equipment to be used with their products. New York registered shares of QIAGEN, included in the Europe 2001 HOLDRS, are traded through the Nasdaq NMS. Shares of QIAGEN also trade on the Frankfurt Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January 3.14 January 5.63 January 8.61 January 24.72 February * February * February 3.22 February 5.96 February 9.05 February 43.63 March * March * March 4.16 March 8.34 March 8.52 March 34.00 April * April * April 4.34 April 8.17 April 9.16 April 36.28 May * May * May 4.88 May 7.69 May 8.77 May 38.09 June * June 1.89 June 6.02 June 7.88 June 8.50 June 43.50 July * July 2.80 July 6.75 July 8.06 July 9.00 July 49.75 August * August 2.98 August 5.97 August 6.22 August 10.94 August 47.75 September * September 3.69 September 5.81 September 6.81 September 10.66 September 47.13 October * October 3.42 October 5.70 October 7.59 October 13.34 October 43.13 November * November 3.33 November 5.61 November 7.63 November 16.75 November 34.56 December * December 3.22 December 5.58 December 7.53 December 18.88
The closing price on , 2000 was . REPSOL YPF, S.A. (REP) Repsol YPF, S.A. is involved in a variety of aspects of the petroleum business, including exploration, development and production of crude oil and natural gas and the transportation, refining and petrochemicals and derivatives. American depositary receipts evidencing American depositary shares of Repsol are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Repsol also trade on the Madrid Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 9.33 January 11.63 January 13.21 January 14.23 January 18.10 January 19.00 February 9.54 February 12.08 February 12.67 February 14.83 February 17.50 February 19.13 March 9.67 March 12.46 March 13.58 March 16.96 March 17.08 March 21.31 April 10.67 April 12.33 April 13.96 April 18.23 April 16.50 April 20.63 May 10.83 May 11.29 May 14.04 May 18.25 May 18.00 May 21.06 June 10.54 June 11.58 June 14.15 June 18.33 June 20.31 June 19.81 July 11.13 July 11.13 July 13.38 July 17.90 July 20.69 July 18.88 August 10.54 August 10.88 August 13.13 August 14.65 August 20.88 August 19.81 September 10.54 September 11.04 September 14.46 September 14.06 September 19.94 September 18.31 October 9.88 October 10.88 October 14.17 October 16.67 October 20.50 October 15.94 November 10.54 November 12.21 November 14.38 November 18.71 November 21.75 November 16.38 December 10.96 December 12.71 December 14.19 December 18.21 December 23.25
The closing price on , 2000 was . A-16 ROYAL DUTCH PETROLEUM COMPANY (RD) Royal Dutch Petroleum Company is a holding company which owns 60% of the companies comprising the Royal Dutch/Shell group of companies. The Royal Dutch/Shell group of companies was formed out of an alliance between Royal Dutch Petroleum and The "Shell" Transport and Trading Company, p.l.c. The companies primarily engage in the development and distribution of oil and natural gas and related products and services. The companies also have investments in chemicals, coal, solar energy and power generation businesses. Royal Dutch Petroleum together with The "Shell" Transport and Trading Company, p.l.c. owns 100% of the outstanding shares of the companies included in the Royal Dutch/Shell group of companies. New York registered shares of Royal Dutch Petroleum, included in the Europe 2001 HOLDRS, are traded on the New York Stock Exchange. Shares of Royal Dutch Petroleum also trade on the London International Stock Exchange and on the Brussels, Frankfurt, Geneva, Basel, Vienna, Paris, Luxembourg, and Zurich Stock Exchanges.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 27.97 January 34.75 January 43.34 January 51.25 January 40.06 January 55.06 February 28.03 February 34.44 February 43.25 February 54.31 February 43.88 February 52.75 March 30.00 March 35.31 March 43.75 March 56.81 March 52.00 March 57.81 April 31.00 April 35.78 April 45.06 April 56.50 April 58.69 April 57.38 May 31.69 May 37.48 May 48.81 May 56.13 May 56.56 May 62.44 June 30.47 June 38.44 June 54.38 June 54.81 June 60.25 June 61.56 July 31.75 July 37.72 July 55.94 July 51.00 July 61.00 July 58.25 August 29.81 August 37.34 August 50.75 August 40.00 August 61.88 August 61.19 September 30.69 September 39.03 September 55.50 September 47.63 September 59.06 September 59.94 October 30.72 October 41.34 October 52.69 October 49.31 October 59.94 October 59.38 November 32.09 November 42.47 November 52.69 November 46.94 November 58.00 November 59.69 December 35.28 December 42.69 December 54.19 December 47.88 December 60.56
The closing price on , 2000 was . RYANAIR HOLDINGS P.L.C. (RYAAY) Ryanair Holdings p.l.c. operates a passenger airline serving routes primarily between Ireland and the United Kingdom. Ryanair currently offers scheduled flights per day serving locations in England, Ireland, Scotland, Wales and continental Europe. It also provides related services to its customers, including charter flights and cargo services. American depositary receipts evidencing American depositary shares of Ryanair are included in the Europe 2001 HOLDRS and are traded through Nasdaq NMS. Shares of Ryanair also trade on the Irish Stock Exchange and London International Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January * January 12.38 January 17.13 January 34.06 February * February * February * February 18.50 February 18.94 February 34.00 March * March * March * March 18.50 March 20.38 March 45.88 April * April * April * April 19.19 April 22.38 April 40.75 May * May * May 12.38 May 17.56 May 22.00 May 40.50 June * June * June 13.56 June 17.81 June 26.50 June 36.50 July * July * July 14.13 July 19.50 July 26.00 July 42.13 August * August * August 13.75 August 14.75 August 22.94 August 36.75 September * September * September 15.02 September 17.13 September 22.94 September 38.50 October * October * October 12.50 October 14.69 October 20.63 October 40.31 November * November * November 13.38 November 13.63 November 24.94 November 48.50 December * December * December 12.56 December 18.88 December 27.56
The closing price on , 2000 was . A-17 SAP AG (SAP) SAP AG develops and markets software that integrates the way businesses interact internally and with third parties. SAP software enables companies of all sizes and industries to fully interact with their employees, customers and partners. Specifically, SAP software is designed to optimize supply chains, manage strategic relationships, reduce time to market and share information. SAP's preference shares, which are included in the Europe 2001 HOLDRS, are listed on the New York Stock Exchange through American depositary receipts and also trade on the Frankfurt Stock Exchange and the Swiss Stock Exchange. SAP preference shares have limited voting rights and holders of the preference shares may vote only on matters affecting their rights in the preference shares.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January 12.73 January 12.51 January 30.24 January 33.94 January 65.19 February * February 13.08 February 12.85 February 34.31 February 32.00 February 71.31 March * March 11.99 March 14.27 March 35.41 March 26.31 March 59.75 April * April 11.04 April 15.33 April 41.52 April 31.38 April 49.13 May * May 11.64 May 15.18 May 46.23 May 33.56 May 42.88 June * June 12.34 June 17.29 June 56.50 June 34.63 June 46.94 July * July 11.90 July 20.21 July 61.37 July 31.69 July 55.75 August * August 13.67 August 19.10 August 41.88 August 33.00 August 64.19 September * September 14.00 September 22.25 September 38.94 September 37.75 September 61.50 October 12.77 October 11.21 October 24.84 October 42.06 October 36.56 October 51.00 November 13.15 November 11.45 November 25.63 November 42.31 November 33.56 November 33.25 December 12.62 December 11.61 December 27.25 December 36.06 December 52.06
The closing price on , 2000 was . SCOTTISH POWER P.L.C. (SPI) Scottish Power is involved in the generation, transmission and distribution of electricity to residential, commercial and industrial customers in the United Kingdom and the northwest United States. In addition, Scottish Power provides gas supply services, water and wastewater services and telecommunications services. American depositary receipts evidencing American depositary shares of Scottish Power are included in the Europe 2001 HOLDRS and are traded through Nasdaq NMS. Shares of Scottish Power also trade on the London International Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 20.83 January 22.97 January 24.01 January 35.00 January 42.25 January 27.69 February 20.73 February 22.41 February 22.91 February 34.38 February 37.56 February 30.06 March 20.91 March 21.10 March 23.22 March 37.94 March 35.19 March 31.69 April 21.76 April 22.36 April 24.21 April 36.50 April 33.50 April 31.94 May 21.22 May 19.71 May 25.13 May 36.50 May 35.38 May 32.06 June 20.62 June 18.89 June 26.03 June 35.25 June 35.00 June 33.44 July 20.13 July 19.62 July 28.23 July 38.75 July 33.63 July 33.13 August 21.10 August 19.16 August 28.22 August 39.13 August 36.81 August 30.13 September 22.28 September 19.10 September 31.00 September 39.75 September 36.31 September 30.06 October 22.03 October 20.49 October 30.75 October 40.00 October 36.81 October 30.19 November 23.00 November 22.72 November 33.00 November 42.88 November 34.94 November 29.38 December 22.98 December 24.10 December 35.63 December 41.31 December 28.00
The closing price on , 2000 was . A-18 SERONO S.A. (SRA) Serono S.A. is a biotechnology company that focuses on research and development and manufacturing and marketing of drugs in the reproductive health, neurology, metabolism and growth areas. The company operates globally and has entered into exclusive agreements with biotechnology companies in Britain and the United States related to research, development, commercialization and delivery of Serono products. American depositary receipts evidencing American depositary shares of Serono are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Serono also trade on the Swiss Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January * January * January * January * February * February * February * February * February * February * March * March * March * March * March * March * April * April * April * April * April * April * May * May * May * May * May * May * June * June * June * June * June * June * July * July * July * July * July * July 27.00 August * August * August * August * August * August 28.63 September * September * September * September * September * September 30.25 October * October * October * October * October * October 22.63 November * November * November * November * November * November 21.38 December * December * December * December * December *
The closing price on , 2000 was . SHIRE PHARMACEUTICALS GROUP P.L.C. (SHPGY) Shire Pharmaceuticals Group p.l.c. is an international pharmaceutical company focused on four therapeutic areas: central nervous system disorders, metabolic diseases, cancer and gastrointestinal disorders. Shire develops, manufactures and markets pharmaceutical products. American depositary receipts evidencing American depositary shares of Shire are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Shire also trade on the London International Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January * January * January 21.13 January 40.69 February * February * February * February * February 20.50 February 48.00 March * March * March * March 21.44 March 22.81 March 51.25 April * April * April * April 22.50 April 21.63 April 40.25 May * May * May * May 19.50 May 23.75 May 43.63 June * June * June * June 21.38 June 26.00 June 51.88 July * July * July * July 24.00 July 25.38 July 54.75 August * August * August * August 18.75 August 25.00 August 56.50 September * September * September * September 21.88 September 28.81 September 51.63 October * October * October * October 21.75 October 31.75 October 62.88 November * November * November * November 22.00 November 30.69 November 45.63 December * December * December * December 20.25 December 29.13
The closing price on , 2000 was . A-19 SMARTFORCE PUBLIC LIMITED COMPANY (SMTF) Smartforce Public Limited Company provides an interactive software platform for business education and training of employees in businesses and organizations in areas, including information technology, business skills, interpersonal skills and project management. Smartforce generates revenue principally from software license agreements covering licenses of their courses to companies for a period of one or more years. American depositary receipts evidencing American depositary shares of Smartforce are included in the Europe 2001 HOLDRS and are traded through Nasdaq NMS.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January 13.56 January 31.88 January 45.44 January 17.88 January 34.00 February * February 14.13 February 27.25 February 45.75 February 15.94 February 44.06 March * March 18.38 March 24.94 March 51.75 March 11.44 March 45.88 April 6.63 April 18.50 April 24.31 April 50.88 April 15.50 April 47.75 May 8.94 May 23.50 May 27.25 May 49.75 May 15.25 May 42.06 June 10.59 June 23.13 June 31.56 June 53.50 June 16.50 June 48.00 July 11.33 July 21.88 July 33.13 July 58.00 July 28.00 July 44.25 August 9.88 August 22.38 August 32.50 August 47.00 August 21.00 August 52.00 September 11.94 September 23.50 September 40.13 September 13.50 September 24.63 September 47.38 October 11.28 October 27.50 October 38.38 October 11.94 October 20.63 October 50.33 November 13.50 November 28.75 November 35.31 November 10.50 November 24.50 November 32.06 December 13.25 December 27.13 December 41.06 December 14.88 December 33.50
The closing price on , 2000 was . SMITHKLINE BEECHAM P.L.C. (SBH) SmithKline Beecham p.l.c., manufactures and markets pharmaceuticals, vaccines, over-the-counter medicines and health-related consumer products which are sold primarily in the United States, the United Kingdom, Germany, France, Italy, Spain, Japan, India and Australia. SmithKline's principal consumer healthcare products include Nicorette, Tums, Contac, Tagamet HB and Aquafresh toothpaste. On January 17, 2000, SmithKline announced that it entered into a merger agreement with Glaxo Wellcome p.l.c. On October 9, 2000, SmithKline announced that it entered into an agreement to acquire Block Drug Company, Inc. Both transactions are subject to regulatory approval and customary closing conditions. American depositary receipts evidencing American depositary shares of SmithKline are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of SmithKline also trade on the London International Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 17.92 January 27.12 January 36.06 January 63.13 January 67.81 January 61.00 February 19.70 February 26.75 February 37.13 February 61.88 February 71.13 February 56.19 March 19.02 March 25.22 March 35.00 March 62.69 March 71.50 March 66.06 April 19.51 April 27.00 April 40.31 April 59.56 April 65.69 April 68.75 May 19.94 May 25.50 May 43.75 May 53.81 May 65.63 May 63.19 June 22.09 June 27.13 June 45.81 June 60.50 June 66.06 June 65.19 July 22.34 July 26.88 July 48.56 July 57.50 July 60.06 July 64.00 August 22.64 August 29.13 August 43.31 August 56.88 August 63.75 August 65.31 September 24.97 September 30.44 September 48.88 September 54.75 September 57.63 September 68.63 October 25.53 October 31.31 October 47.63 October 63.75 October 64.00 October 65.19 November 26.26 November 34.44 November 49.63 November 60.94 November 66.50 November 64.75 December 27.12 December 34.00 December 51.44 December 69.50 December 64.13
The closing price on , 2000 was . A-20 SONERA GROUP P.L.C. (SNRA) Sonera Group p.l.c. provides telecommunication services to residential and business customers, primarily in Finland. Sonera's major lines of business include mobile communications and services, media communications and new services, and fixed network voice and data services. Sonera recently announced that it intends to make initial public offerings of each of its wireless portal, wireless certification and Internet network media service subsidiaries. American depositary receipts representing American depositary shares of Sonera are included in the Europe 2001 HOLDRS and are traded through the Nasdaq NMS. Shares of Sonera also trade on the Helsinki Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January * January * January * January 69.25 February * February * February * February * February * February 78.50 March * March * March * March * March * March 66.38 April * April * April * April * April * April 54.50 May * May * May * May * May * May 50.44 June * June * June * June * June * June 46.00 July * July * July * July * July * July 39.69 August * August * August * August * August * August 33.81 September * September * September * September * September * September 25.25 October * October * October * October * October 31.00 October 22.38 November * November * November * November * November 40.13 November 18.63 December * December * December * December * December 69.25
The closing price on , 2000 was . STMICROELECTRONICS N.V. (STM) STMicroelectronics N.V. designs, develops, manufactures and markets a broad range of semiconductor integrated circuits and devices used in a wide variety of microelectronic applications, including telecommunications systems, computer systems, consumer products, automotive products and industrial automation and control systems. STMicroelectronics markets and sells its products primarily through its direct sales force, distributors and representatives. New York registered shares of STMicroelectronics, included in the Europe 2001 HOLDRS, are traded on the New York Stock Exchange. Shares of STMicroelectronics also trade on the Paris and Italian Stock Exchanges and are also quoted on SEAQ International.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 4.15 January 6.04 January 11.79 January 11.32 January 17.42 January 56.13 February 4.17 February 6.15 February 11.00 February 12.69 February 14.56 February 66.67 March 4.96 March 6.04 March 11.00 March 12.93 March 16.19 March 62.40 April 6.21 April 7.83 April 13.06 April 14.08 April 17.00 April 63.23 May 5.88 May 7.00 May 13.92 May 12.90 May 19.35 May 60.06 June 6.77 June 5.98 June 13.33 June 11.65 June 23.10 June 64.19 July 7.88 July 5.75 July 15.23 July 10.60 July 23.50 July 56.94 August 8.02 August 6.81 August 15.48 August 8.70 August 22.35 August 61.69 September 8.10 September 7.90 September 15.65 September 7.49 September 24.69 September 47.63 October 7.54 October 8.73 October 11.88 October 10.14 October 30.29 October 51.94 November 6.21 November 11.10 November 11.70 November 11.19 November 41.69 November 40.75 December 6.71 December 11.67 December 10.18 December 13.01 December 50.48
The closing price on , 2000 was . A-21 TELEFONICA S.A. (TEF) Telefonica, S.A. is a supplier of telecommunications services in Spain, Portugal and Latin America. Telefonica provides its clients with customized integrated solutions in the areas of communications-fixed-line, mobile, internet, data and television. American depositary receipts evidencing American depositary shares of Telefonica are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Telefonica also trade on the London, Paris, Frankfurt, Tokyo, Buenos Aires, Sao Paulo and Lima stock exchanges.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 12.05 January 14.42 January 22.88 January 31.90 January 45.18 January 76.00 February 12.25 February 16.05 February 22.51 February 33.82 February 44.93 February 86.69 March 12.25 March 15.52 March 23.45 March 43.22 March 41.75 March 74.38 April 12.01 April 17.20 April 25.16 April 40.83 April 45.55 April 66.25 May 13.07 May 17.12 May 28.55 May 43.95 May 47.14 May 60.88 June 12.66 June 18.01 June 28.19 June 45.45 June 48.08 June 64.06 July 13.32 July 17.08 July 25.82 July 47.55 July 46.81 July 63.31 August 13.28 August 18.10 August 25.41 August 35.66 August 47.24 August 57.31 September 13.44 September 18.18 September 30.76 September 35.27 September 47.06 September 59.44 October 12.30 October 19.69 October 26.88 October 44.75 October 48.96 October 57.94 November 13.56 November 21.57 November 28.27 November 45.55 November 62.13 November 47.31 December 13.68 December 22.63 December 29.76 December 44.24 December 78.81
The closing price on , 2000 was . TERRA LYCOS, INC. (TRLY) Terra Networks, Inc. provides Internet access and local-language interactive content and services to Spanish and Portuguese-speaking residential and small office/home office customers in Spain, Brazil, Mexico, Peru, Chile and Guatemala. American depositary receipts evidencing American depositary shares of Terra Lycos are included in the Europe 2001 HOLDRS and are traded through Nasdaq NMS. Shares of Terra Lycos also trade on the Madrid Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January * January * January * January 87.81 February * February * February * February * February * February 129.63 March * March * March * March * March * March 78.50 April * April * April * April * April * April 62.50 May * May * May * May * May * May 43.63 June * June * June * June * June * June 36.47 July * July * July * July * July * July 38.19 August * August * August * August * August * August 40.13 September * September * September * September * September * September 36.75 October * October * October * October * October * October 24.19 November * November * November * November * November 33.75 November 14.00 December * December * December * December * December 54.75
The closing price on , 2000 was . A-22 TOTAL FINA ELF S.A. (TOT) Total Fina Elf S.A. is an international oil and gas company. Total Fina is involved in many aspects of the petroleum industry, including oil and gas exploration, development and production, refining and marketing and trading and shipping of crude oil and petroleum products. Total Fina also produces petrochemicals and specialty chemical products for industrial and consumer use. In addition, Total Fina is involved in the coal mining, nuclear power, cogeneration and electricity sectors. American depositary receipts evidencing American depositary shares of Total Fina are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Total Fina also trade on the Paris Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 28.38 January 34.50 January 43.13 January 51.88 January 51.25 January 62.25 February 27.75 February 32.88 February 39.63 February 55.00 February 51.63 February 67.13 March 30.00 March 34.00 March 42.38 March 60.06 March 61.00 March 73.63 April 31.38 April 34.25 April 41.63 April 58.75 April 68.00 April 75.63 May 31.00 May 36.00 May 45.63 May 62.31 May 60.81 May 78.94 June 30.25 June 37.13 June 50.63 June 65.38 June 64.44 June 76.81 July 31.13 July 35.75 July 50.44 July 57.19 July 63.63 July 73.56 August 29.75 August 37.13 August 47.38 August 48.06 August 65.04 August 74.50 September 30.13 September 39.13 September 57.31 September 62.81 September 63.44 September 73.44 October 30.88 October 39.00 October 55.50 October 58.50 October 66.69 October 71.63 November 30.88 November 40.38 November 52.56 November 61.13 November 66.13 November 70.63 December 34.00 December 40.25 December 55.75 December 49.75 December 69.25
The closing price on , 2000 was . UBS AG (UBS) UBS AG is a global investment banking services firm that offers investment, trading and risk management services. On November 3, 2000, UBS acquired Paine Webber Group, Inc. UBS's clients include international corporations, small and medium-sized businesses in Switzerland, governments and other public bodies, financial institutions, market participants and individuals. Global shares of UBS, included in the Europe 2001 HOLDRS, are traded on the New York Stock Exchange. Shares of UBS also trade on the Zurich Stock Exchange and the Tokyo Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January * January * January * January * February * February * February * February * February * February * March * March * March * March * March * March * April * April * April * April * April * April * May * May * May * May * May * May 135.25 June * June * June * June * June * June 147.00 July * July * July * July * July * July 144.00 August * August * August * August * August * August 146.19 September * September * September * September * September * September 135.44 October * October * October * October * October * October 140.00 November * November * November * November * November * November 137.25 December * December * December * December * December *
The closing price on , 2000 was . A-23 UNILEVER N.V. (UN) Unilever N.V. is an international supplier of consumer goods in the food, home and personal care product categories. Unilever products include culinary, frozen food, deodorant, hair care, laundry, cooking, skin and oral care and fragrance products sold under such brand names as Ponds, Dove, Lipton and Magnum. New York registered shares of Unilever, included in the Europe 2001 HOLDRS, trade on the New York Stock Exchange. Shares of Unilever also trade on the Amsterdam, London, Belgium, France, Germany, Luxembourg and Swiss Stock Exchanges.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 33.04 January 40.57 January 46.06 January 63.91 January 85.68 January 46.25 February 34.02 February 37.66 February 53.34 February 72.03 February 81.13 February 45.50 March 36.75 March 38.01 March 52.15 March 76.86 March 74.41 March 48.13 April 37.42 April 38.22 April 54.95 April 83.58 April 72.73 April 45.56 May 35.63 May 37.77 May 54.25 May 88.41 May 65.31 May 50.81 June 36.44 June 40.64 June 61.04 June 88.41 June 69.75 June 43.00 July 36.89 July 39.83 July 61.04 July 78.12 July 69.88 July 44.25 August 34.62 August 40.18 August 56.35 August 71.12 August 68.88 August 47.25 September 36.40 September 44.14 September 59.54 September 68.60 September 68.13 September 48.25 October 36.68 October 42.81 October 59.78 October 84.28 October 66.69 October 50.81 November 37.21 November 48.48 November 65.03 November 87.08 November 54.44 November 62.06 December 39.41 December 49.07 December 69.93 December 92.89 December 54.44
The closing price on , 2000 was . UNITED PAN-EUROPE COMMUNICATIONS N.V. (UPCOY) United Pan-Europe Communications N.V. owns and operates broadband communications networks in 17 countries in Europe and also in Israel. United Pan-Europe provides communications services in Europe through its cable television, telephony, Internet/data services, direct-to-home and media business lines. American depositary receipts evidencing American depositary shares of United Pan-Europe are included in the Europe 2001 HOLDRS and trade through the Nasdaq NMS. Shares of United Pan-Europe also trade on the Amsterdam Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January * January * January * January * January 42.50 February * February * February * February * February 12.60 February 66.21 March * March * March * March * March 12.75 March 49.56 April * April * April * April * April 16.98 April 36.56 May * May * May * May * May 20.54 May 25.63 June * June * June * June * June 18.42 June 27.00 July * July * July * July * July 21.33 July 25.63 August * August * August * August * August 20.25 August 24.00 September * September * September * September * September 20.33 September 19.44 October * October * October * October * October 25.83 October 18.25 November * November * November * November * November 32.25 November 11.75 December * December * December * December * December 42.50
The closing price on , 2000 was . A-24 VIVENDI (V) Vivendi provides communications and environmental management services. Vivendi's communications services include a variety of communications, entertainment and educational products and services, including mobile telephone, Internet services, film production and publishing. Vivendi also offers a variety of environmental services, including water treatment and systems operation, waste management, energy and transportation services to public authorities and industrial, commercial and residential customers. On June 20, 2000, Vivendi announced that it had entered into a merger agreement with The Seagram Company Ltd. and CANAL+. This transaction is still subject to regulatory and stockholder approval and customary closing conditions. American depositary receipts evidencing American depositary shares of Vivendi are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Vivendi also trade on the Paris Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January * January 7.07 January 8.54 January 9.68 January 19.49 January 20.55 February * February 6.68 February 9.28 February 10.49 February 17.38 February 23.49 March * March 6.82 March 9.06 March 10.82 March 16.40 March 23.06 April * April 7.24 April 9.29 April 12.39 April 15.59 April 19.83 May * May 7.12 May 8.22 May 13.39 May 14.58 May 21.33 June 7.43 June 7.45 June 8.55 June 14.24 June 16.20 June 17.72 July 7.90 July 6.86 July 8.43 July 14.59 July 15.72 July 15.98 August 7.05 August 6.44 August 7.45 August 13.29 August 15.44 August 16.36 September 6.42 September 7.25 September 7.84 September 13.27 September 14.05 September 14.81 October 6.19 October 7.97 October 7.79 October 15.22 October 15.15 October 14.56 November 6.50 November 8.22 November 8.81 November 15.12 November 16.01 November 12.38 December 6.66 December 8.25 December 9.31 December 17.31 December 17.97
The closing price on , 2000 was . VODAFONE AIRTOUCH P.L.C. (VOD) Vodafone Airtouch p.l.c. provides international wireless telecommunications services which include selling and renting cellular telephone equipment, providing messaging and data transmission facilities and access to information services. Vodafone's principal business is the operation of digital and analog wireless telephone networks in the United Kingdom. Vodafone also has investments in several international telecommunications operations. Service on Vodafone networks is generally sold by third-party service providers or retailers who also sell or rent cellular telephone equipment. American depositary receipts evidencing American depositary shares of Vodafone are included in the Europe 2001 HOLDRS and are traded on the New York Stock Exchange. Shares of Vodafone also trade on the London International Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 6.13 January 7.15 January 8.60 January 15.05 January 39.05 January 56.00 February 6.13 February 7.08 February 9.50 February 17.70 February 36.44 February 57.69 March 6.63 March 7.50 March 8.83 March 20.78 March 37.55 March 55.56 April 6.38 April 8.03 April 8.85 April 21.99 April 35.91 April 47.00 May 6.75 May 7.93 May 8.93 May 21.98 May 38.28 May 45.81 June 7.58 June 7.38 June 9.69 June 25.21 June 39.40 June 41.44 July 7.88 July 7.15 July 10.10 July 27.30 July 42.10 July 43.13 August 8.38 August 7.58 August 10.19 August 25.13 August 40.11 August 40.94 September 8.20 September 6.83 September 10.75 September 22.68 September 47.55 September 37.00 October 8.18 October 7.73 October 10.98 October 26.93 October 47.63 October 42.56 November 7.20 November 8.65 November 13.20 November 29.54 November 47.19 November 34.38 December 7.05 December 8.28 December 14.53 December 32.23 December 49.50
The closing price on , 2000 was . A-25 WPP GROUP PLC (WPPGY) WPP Group plc is an international communication services organization that provides advertising, media investment management, information and consultancy, public relations and public affairs, branding and identity, healthcare and specialist communications. American depositary receipts evidencing American depositary shares of WPP Group are included in the Europe 2001 HOLDRS and traded through Nasdaq NMS. Shares of WPP Group also trade on the London International Stock Exchange.
Closing Closing Closing Closing Closing Closing 1995 Price 1996 Price 1997 Price 1998 Price 1999 Price 2000 Price - --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- --------- ------- January 8.75 January 13.00 January 19.56 January 21.75 January 37.41 January 81.00 February 8.44 February 13.75 February 21.50 February 26.81 February 39.81 February 99.00 March 7.97 March 15.31 March 20.38 March 29.00 March 43.25 March 86.75 April 8.75 April 15.50 April 20.44 April 32.19 April 43.88 April 77.38 May 9.69 May 15.38 May 19.69 May 32.00 May 40.81 May 60.56 June 9.38 June 16.75 June 20.38 June 33.63 June 42.88 June 72.63 July 10.78 July 16.25 July 20.56 July 33.69 July 44.75 July 69.00 August 13.13 August 18.19 August 23.00 August 27.19 August 46.97 August 70.63 September 12.03 September 18.31 September 22.94 September 22.81 September 46.50 September 59.31 October 12.03 October 18.44 October 23.06 October 24.88 October 54.94 October 66.88 November 12.13 November 18.31 November 22.66 November 27.75 November 72.50 November 53.44 December 12.69 December 21.47 December 22.56 December 30.88 December 83.13
The closing price on , 2000 was . A-26 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- [LOGO OF HOLDRS] 1,000,000,000 Depositary Receipts Europe 2001 HOLDRSSM Trust --------------------- PROSPECTUS --------------------- Merrill Lynch & Co. Robert W. Baird & Co. A.G. Edwards & Sons, Inc. First Union Securities, Inc. Legg Mason Wood Walker Incorporated Morgan Keegan & Company, Inc. Raymond James & Associates, Inc. Sutro & Co. Incorporated Tucker Anthony Capital Markets , 2000 Until , 2000 (25 days after the date of this prospectus), all dealers effecting transactions in the offered Europe 2001 HOLDRS, whether or not participating in this distribution, may be required to deliver a prospectus. This requirement is in addition to the obligations of dealers to deliver a prospectus when acting as underwriters and with respect to unsold allotments or subscriptions. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- PART II INFORMATION NOT REQUIRED IN PROSPECTUS Item 14. Other Expenses of Issuance and Distribution. The expenses expected to be incurred in connection with the issuance and distribution of the securities being registered, other than underwriting compensation, are as set forth below. Except for the registration fee payable to the Securities and Exchange Commission, all such expenses are estimated: Securities and Exchange Commission registration fee................. $ Printing and engraving expenses..................................... Legal fees and expenses............................................. Miscellaneous....................................................... --- Total............................................................. $
Item 15. Indemnification of Directors and Officers. Section 145 of the General Corporation Law of the State of Delaware, as amended, provides that under certain circumstances a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that such person is or was a director, officer, employee or agent of the corporation or is or was serving at its request in such capacity in another corporation or business association, against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the corporation and, with respect to any criminal action or proceeding, had no reasonable cause to believe such person's conduct was unlawful. Article XIV, Section 2 of the Restated Certificate of Incorporation of Merrill Lynch, Pierce, Fenner & Smith Incorporated provides in effect that, subject to certain limited exceptions, Merrill Lynch, Pierce, Fenner & Smith Incorporated shall indemnify its directors and officers to the full extent authorized or permitted by law. The directors and officers of Merrill Lynch, Pierce, Fenner & Smith Incorporated are insured under policies of insurance maintained by Merrill Lynch, Pierce, Fenner & Smith Incorporated, subject to the limits of the policies, against certain losses arising from any claim made against them by reason of being or having been such directors or officers. In addition, Merrill Lynch, Pierce, Fenner & Smith Incorporated has entered into contracts with all of its directors providing for indemnification of such persons by Merrill Lynch, Pierce, Fenner & Smith Incorporated to the full extent authorized or permitted by law, subject to certain limited exceptions. Item 16. Exhibits. See Exhibit Index. Item 17. Undertakings. The undersigned Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933. II-1 (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of the prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement. (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (4) For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective. (5) For purposes of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (6) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to Item 15 of this registration statement, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. II-2 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant hereby certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-1 and has duly caused this Amendment No. 1 to the Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New York, on December 1, 2000. Merrill Lynch, Pierce, Fenner & Smith Incorporated /s/ Ahmass L. Fakahany By: ______________________ Ahmass L. Fakahany Senior Vice President and Chief Financial Officer Pursuant to the requirements of the Securities Act of 1933, this Amendment No. 1 to the Registration Statement has been signed by the following persons in the capacities indicated on December 1, 2000.
Signature Title --------- ----- * Chief Executive Officer, Chairman of ______________________________________ the Board and Director John L. Steffens * Director ______________________________________ E. Stanley O'Neal * Director ______________________________________ George A. Schieren * Director ______________________________________ Thomas H. Patrick * Senior Vice President and ______________________________________ Chief Financial Officer Ahmass L. Fakahany * First Vice President and Controller ______________________________________ Dominic A. Carone /s/ Stephen G. Bodurtha Attorney-in-Fact ______________________________________ Stephen G. Bodurtha
II-3 INDEX TO EXHIBITS Exhibits 4.1 Standard Terms for Depositary Trust Agreements between Merrill Lynch, Pierce, Fenner & Smith Incorporated and The Bank of New York, as Trustee dated as of September 2, 1999, and included as exhibits thereto, form of Depositary Trust Agreement and form of HOLDRS and Form of Amendment No. 3 to the Standard Terms for Depositary Trust Agreements 5.1 Opinion of Shearman & Sterling regarding the validity of the Europe 2001 HOLDRS Receipts 8.1 Opinion of Shearman & Sterling, as special U.S. tax counsel regarding the material federal income tax consequences *24.1 Power of Attorney (included in Part II of Registration Statement)
- -------- * Previously filed. II-4 EX-4.1 2 0002.txt STANDART TERMS FOR DEPOSITARY TRUST AGREEMENTS S&C Draft of 8/31/99 Exhibit 4.1 STANDARD TERMS FOR DEPOSITARY TRUST AGREEMENTS between MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED and THE BANK OF NEW YORK, as Trustee Dated as of ______________, 1999 TABLE OF CONTENTS
Page ---- ARTICLE 1 DEFINITIONS AND ASSUMPTIONS Section 1.1. Definitions................................................................................1 Section 1.2. Rules of Construction......................................................................5 ARTICLE 2 FORM OF RECEIPTS, DEPOSIT OF SECURITIES, DELIVERY, REGISTRATION OF TRANSFER AND SURRENDER OF RECEIPTS Section 2.1. Depositary Trust Agreements................................................................6 Section 2.2. Creation and Declaration of Trusts; Deposit of Securities..................................6 Section 2.3. Acceptance by Trustee......................................................................8 Section 2.4. Form and Transferability of Receipts.......................................................8 Section 2.5. Delivery of Receipts.....................................................................10 Section 2.6. Registration; Registration of Transfer; Combination and Split-up of Certificates..........11 Section 2.7. Surrender of Receipts and Withdrawal of Underlying Securities.............................12 Section 2.8. Limitations on Delivery, Registration of Transfer and Surrender of Receipts...............13 Section 2.9. Lost Certificates, Etc....................................................................14 Section 2.10. Cancellation and Destruction of Surrendered Certificates.................................14 Section 2.11. Reconstitution Events....................................................................14 ARTICLE 3 CERTAIN OBLIGATIONS OF OWNERS OF RECEIPTS Section 3.1. Filing Proofs, Certificates and Other Information.........................................16 Section 3.2. Liability of Owner for Taxes..............................................................16 Section 3.3. Warranties on Deposit of Shares...........................................................17 ARTICLE 4 THE UNDERLYING SECURITIES Section 4.1. Cash Distributions........................................................................17 Section 4.2. Distributions Other Than Cash or Securities...............................................17 Section 4.3. Distributions in Securities...............................................................18 Section 4.4. Rights Offerings..........................................................................19 Section 4.5. Fixing of Record Date.....................................................................19 Section 4.6. Reports...................................................................................20 Section 4.7. Voting Instructions for Underlying Securities.............................................20 Section 4.8. Changes Affecting Underlying Securities...................................................21 Section 4.9. Withholding...............................................................................22 Section 4.10. Limitation on Distributions..............................................................22
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ARTICLE 5 THE TRUSTEE AND THE INITIAL DEPOSITOR Section 5.1. Maintenance of Office and Transfer Books by the Trustee...................................22 Section 5.2. Prevention or Delay in Performance by the Initial Depositor or the Trustee................23 Section 5.3. Obligations of the Initial Depositor and the Trustee......................................24 Section 5.4. Resignation or Removal of the Trustee; Appointment of Successor Trustee...................26 Section 5.5. Indemnification...........................................................................27 Section 5.6. Charges of Trustee........................................................................29 Section 5.7. Retention of Trust Documents..............................................................30 Section 5.8. Federal Securities Law Filings............................................................30 Section 5.9. Prospectus Delivery.......................................................................30 ARTICLE 6 AMENDMENT AND TERMINATION Section 6.1. Amendment.................................................................................31 Section 6.2. Early Termination.........................................................................31 ARTICLE 7 MISCELLANEOUS Section 7.1. Counterparts.............................................................................33 Section 7.2. Third-Party Beneficiaries................................................................33 Section 7.3. Severability.............................................................................34 Section 7.4. Owners and Beneficial Owners as Parties; Binding Effect..................................34 Section 7.5. Notices..................................................................................34 Section 7.6. Governing Law............................................................................35
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Page ---- EXHIBIT A FORM OF DEPOSITARY TRUST AGREEMENT.....................................................................A-1 EXHIBIT B FORM OF CERTIFICATE EVIDENCING RECEIPTS................................................................B-1
-iii- STANDARD TERMS FOR DEPOSITARY TRUST AGREEMENTS agreed to as of _______________, 1999 (these "Standard Terms"), between MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, a Delaware corporation (the "Initial Depositor") and THE BANK OF NEW YORK, a New York banking corporation, as trustee (the "Trustee"). W I T N E S S E T H : WHEREAS, from time to time, the Initial Depositor and the Trustee may enter into one or more depositary trust agreements providing for the deposit with the Trustee of specified Securities (as hereinafter defined), the creation of Depositary Trust Receipts representing the Securities so deposited and the execution and delivery of certificates evidencing the Depositary Trust Receipts; and WHEREAS, the Initial Depositor and the Trustee wish to establish the general terms and conditions of such depositary trust agreements and the form of the certificates evidencing Depositary Trust Receipts; NOW, THEREFORE, in consideration of the premises and the mutual covenants contained in these Standard Terms, the parties hereby agree as follows: ARTICLE 1 DEFINITIONS AND ASSUMPTIONS Section 1.1. Definitions. Except as otherwise specified in these ----------- Standard Terms or in the applicable Depositary Trust Agreement or as the context may otherwise require, the following terms have the respective meanings set forth below for all purposes of these Standard Terms and the applicable Depositary Trust Agreement. "Beneficial Owner" means any Person owning a beneficial interest in any Receipt. "Closing Date" means the day on which the initial deposit of Securities is to be made, which date may be specified in the applicable Depositary Trust Agreement. "Commission" means the Securities and Exchange Commission of the United States or any successor governmental agency in the United States. "Corporate Trust Office" means the office of the Trustee at which its depositary receipt business is administered which, at the date of these Standard Terms, is 101 Barclay Street, New York, New York 10286. "Deliver" means (a) when used with respect to Securities, either (i) one or more book-entry transfers of such Securities to an account at DTC designated by the Person entitled to such delivery for further credit as specified by such Person or (ii) in the case of Securities for which DTC book- entry settlement is not available, the delivery of certificates evidencing such Securities to the Person entitled to such delivery, duly endorsed for transfer or accompanied by proper instruments of transfer and (b) when used with respect to Receipts, either (i) one or more book-entry transfers of Receipts to an account at DTC designated by the Person entitled to such delivery for further credit as specified by such Person or (ii) in the event DTC ceases to make its book-entry settlement system available for the Receipts, execution and delivery at the Corporate Trust Office of the Trustee of one or more certificates evidencing such Receipts. -2- "Depositary Trust Agreement" means a depositary trust agreement entered into by the Initial Depositor and the Trustee pursuant to these Standard Terms which incorporates by reference these Standard Terms. "Depositor" means any Person who deposits Securities into the Trust, either for its own account or on behalf of another Person who is the owner or beneficial owner of such Securities. "Depositor Order" means a written order or request signed in the name of the Initial Depositor or any other Depositor, as applicable. "DTC" means The Depository Trust Company, its nominees and their respective successors. "Initial Depositor" means Merrill Lynch, Pierce, Fenner & Smith Incorporated, a Delaware corporation, or its successor. "Issuance Denomination" is defined in Section 2.4, subject to increase as provided in Sections 4.3 and 4.8. "Owner" means the Person in whose name a Receipt is registered in the books of the Trustee maintained for that purpose. "Person" means any individual, limited liability company, corporation, partnership, joint venture, association, joint stock company, trust (including any trust beneficiary), unincorporated organization or government or any agency or political subdivision thereof. -3- "Receipt" means a depositary trust receipt which is issued under the Depositary Trust Agreement and which represents the Owner's right to receive the Underlying Securities which must be deposited into the Trust for issuance of a Receipt plus any other Underlying Securities received by the Trustee with respect to such Underlying Securities and held by the Trustee under the Depositary Trust Agreement at such time. The Trustee shall only accept for deposit whole Securities and shall not issue Receipts except to the extent such Receipts represent, in the aggregate, whole Underlying Securities. "Registrar" means any bank or trust company having an office in the Borough of Manhattan, The City of New York, which shall be appointed to register Receipts and transfers of Receipts as herein provided. "Restricted Securities" means Securities, or Receipts representing such Securities, which are acquired directly or indirectly from the issuer or its affiliates (as defined in Rule 144 under the Securities Act of 1933) in a transaction or chain of transactions not involving any public offering, or which are held by an officer or director (or person performing similar functions) or other affiliate of the issuer, or which would require registration under the Securities Act of 1933 in connection with the public offer and sale thereof in the United States, or which are subject to other restrictions on sale or deposit under the federal securities laws of the United States, a shareholder agreement or the corporate documents of the issuer. "Round Lot" means 100. -4- "Securities" means any shares of a class of securities which must be deposited for issuance of Receipts. "Securities Issuer" means, as of any time, the issuer of a class of Securities. "Securities Registrar" means the entity that presently carries out the duties of registrar for any Securities or any successor as registrar for any Securities and any other appointed agent of a Securities Issuer for the transfer and registration of Securities. "Surrender" means, when used with respect to Receipts, (a) one or more book-entry transfers of Receipts to the DTC account of the Trustee or (b) surrender to the Trustee at its Corporate Trust Office of one or more certificates evidencing such Receipts, in each case in a Round Lot or an integral multiple thereof. "Trust" means the trust entity created by the Depositary Trust Agreement. "Trustee" means The Bank of New York, a New York banking corporation, in its capacity as Trustee under the Depositary Trust Agreement, or any successor as Trustee thereunder. "Underlying Securities" means, as of any time, Securities of each of the classes and in the quantities required by the Depositary Trust Agreement to be deposited in the Trust for the issuance of Receipts and which are at such time deposited under the applicable Depositary Trust Agreement and any other securities, property or cash received by the Trustee in respect thereof and at such time held hereunder. -5- 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 these Standard Terms or the Depositary Trust Agreement as a whole and not to any particular Article, Section or other subdivision; (v) "including" means including without limitation; and (vi) words in the singular include the plural and words in the plural include the singular. ARTICLE 2 FORM OF RECEIPTS, DEPOSIT OF SECURITIES, DELIVERY, REGISTRATION OF TRANSFER AND SURRENDER OF RECEIPTS Section 2.1. Depositary Trust Agreements. Each Depositary Trust --------------------------- Agreement entered into between the Initial Depositor and the Trustee for the purposes set -6- forth herein shall be in substantially the form of Exhibit A to these Standard Terms and shall provide that these Standard Terms shall be incorporated by reference into, and form a part of, such Depositary Trust Agreement. Section 2.2. Creation and Declaration of Trusts; Deposit of ---------------------------------------------- Securities. (a) The Initial Depositor, concurrently with the execution and - ---------- delivery of the Depositary Trust Agreement, does hereby agree to deposit with the Trustee under the Depositary Trust Agreement all the right, title and interest of the Initial Depositor in, to and under Securities, of each of the classes and in the quantities necessary to create Receipts in accordance with Section 2 of the Depositary Trust Agreement in effect at the time of deposit. Unless otherwise specified in the Depositary Trust Agreement, such deposit shall include all cash dividends and distributions in respect of such Securities. The Initial Depositor shall make such deposit on or prior to the Closing Date. (b) From time to time after the date of the Depositary Trust Agreement, a Depositor may deposit with the Trustee, in the manner specified in subsection (a), Securities, of each of the classes and in the quantities necessary to create Receipts in accordance with Section 2 of the Depositary Trust Agreement in effect at the time of deposit by Delivery of such Securities to the Trustee. (c) The Trustee shall only accept for deposit whole Securities and shall not issue Receipts except to the extent such Receipts represent, in the aggregate, whole Underlying Securities. (d) The Trust shall not engage in any business or activities other than those required or authorized by these Standard Terms or incidental and necessary to carry out the duties and responsibilities set forth in the Depositary Trust -7- Agreement. Other than issuance of the Receipts, the Trust shall not issue or sell any certificates or other obligations or otherwise incur, assume or guarantee any indebtedness for money borrowed. (e) Anything herein to the contrary notwithstanding, the Trustee does not assume any of the duties, responsibilities, obligations or liabilities of the Initial Depositor or any other Depositor in respect of the Underlying Securities. (f) Underlying Securities shall be held by the Trustee at such place and in such manner as the Trustee shall determine. Section 2.3. Acceptance by Trustee. The Trustee will hold the --------------------- Underlying Securities for the benefit of the Owners for the purposes, and subject to and limited by the terms and conditions, set forth in these Standard Terms and the applicable Depositary Trust Agreement. Section 2.4. Form and Transferability of Receipts. (a) The ------------------------------------ certificates evidencing Receipts shall be substantially in the form set forth in Exhibit B annexed to these Standard Terms, with appropriate insertions, modifications and omissions, as hereinafter provided or as may be provided in the Depositary Trust Agreement. The Issuance Denominations of a certificate shall be any integral multiple of a Round Lot of Receipts, subject to increase or decrease as provided in Sections 4.3 and 4.8. No Receipt shall be entitled to any benefits under the Depositary Trust Agreement or be valid or obligatory for any purpose unless a certificate evidencing such Receipt shall have been executed by the Trustee by the manual or facsimile signature -8- of a duly authorized signatory of the Trustee and, if a Registrar (other than the Trustee) for the Receipts shall have been appointed, countersigned by the manual or facsimile signature of a duly authorized officer of the Registrar. The Trustee shall maintain books on which the registered ownership of each Receipt and transfers, if any, of such registered ownership shall be recorded. Certificates evidencing Receipts bearing the manual or facsimile signature of a duly authorized signatory of the Trustee and Registrar, if applicable, who was at the time such certificates were executed a proper signatory of the Trustee or Registrar, if applicable, shall bind the Trustee, notwithstanding that such signatory has ceased to hold such office prior to the delivery of such certificates. (b) The certificates evidencing Receipts may be endorsed with or have incorporated in the text thereof such legends or recitals or modifications not inconsistent with the provisions of the Depositary Trust Agreement as may be required by the Trustee or required to comply with any applicable law or regulations thereunder or with the rules and regulations of any securities exchange upon which Receipts may be listed or to conform with any usage with respect thereto, or to indicate any special limitations or restrictions to which any particular Receipts are subject by reason of the date of issuance of the Underlying Securities or otherwise. (c) The Initial Depositor and the Trustee will apply to DTC for acceptance of the Receipts in its book-entry settlement system. Receipts deposited with DTC shall be represented by one or more global certificates which shall be registered in the name of Cede & Co., as nominee for DTC, and shall bear the following legend: UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE AGENT AUTHORIZED BY THE ISSUER FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF -9- DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. (d) So long as the Receipts are eligible for book-entry settlement with DTC and such settlement is available, unless otherwise required by law, notwithstanding anything to the contrary in the Depositary Trust Agreement, all Receipts shall be evidenced by one or more global certificates registered in the name of a nominee of DTC and no person acquiring beneficial ownership of such Receipts shall receive or be entitled to receive physical delivery of Receipts. Ownership of beneficial interests in Receipts evidenced by such global certificate or certificates shall be shown on, and the transfer of such ownership shall be effected only through, records maintained by (i) DTC or (ii) institutions that have accounts with DTC. (e) If, at any time when Receipts are evidenced by a global certificate, DTC ceases to make its book-entry settlement system available for such Receipts, the Trustee shall issue separate certificates evidencing Receipts to the DTC book-entry settlement system participants entitled thereto, with such additions, deletions and modifications to the Depositary Trust Agreement and to the form of certificate evidencing Receipts as the Initial Depositor and the Trustee may, from time to time, agree. (f) Title to a certificate evidencing Receipts (and to the Receipts evidenced thereby), when properly endorsed or accompanied by proper instruments of transfer, shall be transferable by delivery with the same effect as in the case of a negotiable instrument under the laws of New York; provided, -------- however, that the Trustee, notwithstanding any notice to the contrary, may treat - ------- the Owner of Receipts as the -10- absolute owner thereof for the purpose of determining the person entitled to distribution of dividends or other distributions or to any notice provided for in the Depositary Trust Agreement and for all other purposes. Section 2.5. Delivery of Receipts. Upon receipt by the Trustee of --------------------- any deposit pursuant to Section 2.2, together with a Depositor Order and the other documents required as above specified, if any, the Trustee, subject to the terms and conditions of the applicable Depositary Trust Agreement, shall Deliver to or upon the written order of the Depositor the number of Receipts issuable in respect of such deposit, provided such number is an integral multiple of an Issuance Denomination, but only upon payment to the Trustee of the fees and expenses of the Trustee as provided in Section 5.6 and of all taxes and governmental charges and fees payable in connection with such deposit and the transfer of the Underlying Securities. Section 2.6. Registration; Registration of Transfer; Combination and ------------------------------------------------------- Split-up of Certificates. (a) The Trustee shall keep or cause to be kept a - ------------------------- register of Owners of Receipts and shall provide for the registration of Receipts and the registration of transfers and exchanges of Receipts. (b) The Trustee, subject to the terms and conditions of these Standard Terms and the applicable Depositary Trust Agreement, shall register transfers of ownership of Receipts on its transfer books from time to time, upon any Surrender of a certificate evidencing such Receipts in any integral multiple of a Round Lot, by the Owner in person or by a duly authorized attorney, properly endorsed or accompanied by proper instruments of transfer, and duly stamped as may be required by the laws of the State of New York and of the United States of America. Thereupon the Trustee shall execute a new certificate or certificates evidencing such Receipts in any integral multiple -11- of a Round Lot requested, and deliver the same to or upon the order of the Person entitled thereto. (c) The Trustee, subject to the terms and conditions of these Standard Terms and the applicable Depositary Trust Agreement, shall, upon Surrender of a certificate evidencing Receipts for the purposes of effecting a split-up or combination of such certificate or certificates, execute and deliver one or more new certificate or certificates evidencing such Receipts in any integral multiple of a Round Lot requested. (d) The Trustee may appoint one or more co-transfer agents for the purpose of effecting transfers, combinations and split-ups of Receipts at designated transfer offices on behalf of the Trustee. In carrying out its functions, a co-transfer agent may require evidence of authority and compliance with applicable laws and other requirements by Owners or Persons entitled to Receipts and will be entitled to protection and indemnity to the same extent as the Trustee. Section 2.7. Surrender of Receipts and Withdrawal of Underlying -------------------------------------------------- Securities. (a) Upon Surrender at the Corporate Trust Office of the Trustee - ---------- of a Round Lot of Receipts or integral multiple thereof for the purpose of withdrawal of the Underlying Securities represented thereby, and upon payment of the fee of the Trustee in connection with the Surrender of Receipts as provided in Section 5.6 and payment of all taxes and charges payable in connection with such Surrender and withdrawal of the Underlying Securities, and subject to the terms and conditions of the applicable Depositary Trust Agreement, including, without limitation, Section 4.10, the Owner of such Receipts shall be entitled to Delivery of the amount of Underlying Securities at the time represented by such Receipts. Delivery of such Underlying Securities may be made by (i) Delivery of Securities to such Owner or as ordered by such Owner and (ii) any -12- available form of delivery of any other securities, property and cash to which such Owner is then entitled to such Owner or as ordered by such Owner. The Trustee shall make such delivery as promptly as practicable. (b) A certificate evidencing Receipts Surrendered for such purposes may be required by the Trustee to be properly endorsed in blank or accompanied by proper instruments of transfer in blank, and if the Trustee so requires, the Owner thereof shall execute and deliver to the Trustee a written order directing the Trustee to cause the Underlying Securities being withdrawn to be delivered to or upon the written order of a Person or Persons designated in such order. Thereupon the Trustee shall Deliver through the facilities of DTC or, if applicable, at its Corporate Trust office, subject to Sections 2.8, 3.1, 3.2 and 4.10 and to the other terms and conditions of the Depositary Trust Agreement, to or upon the written order of the Person or Persons designated in the order delivered to the Trustee as above provided, the amount of Underlying Securities represented by such Receipts. Section 2.8. Limitations on Delivery, Registration of Transfer and ----------------------------------------------------- Surrender of Receipts. (a) As a condition precedent to the Delivery, - --------------------- registration of transfer, split-up, combination or Surrender (including, for the avoidance of doubt, any Surrender in connection with an exchange) of any Receipt or withdrawal of any Underlying Securities, the Trustee or Registrar may require payment from the Depositor of Securities or the presentor of the Receipts of a sum sufficient to reimburse it for any tax or other charge and any stock transfer or registration fee with respect thereto (including any such tax or charge and fee with respect to Securities being deposited or withdrawn) and payment of any applicable fees as herein provided, may require the production of proof satisfactory to it as to the identity and genuineness of any signature and may also require compliance with any regulations the Trustee may establish -13- consistent with the provisions of the Depositary Trust Agreement, including, without limitation, this Section 2.8. (b) The Delivery of Receipts against deposits of Securities, the registration of transfer of Receipts or the Surrender of Receipts for the purpose of withdrawal of Underlying Securities may be suspended, generally or in particular instances, during any period when the transfer books of the Trustee are closed or the transfer books of a Securities Issuer are closed or if any such action is deemed necessary or advisable by the Trustee at any time or from time to time, subject to the provisions of the following sentence. Notwithstanding any other provision of any applicable Depositary Trust Agreement or the Receipts, the Surrender of Receipts and withdrawal of Underlying Securities may not be suspended except for (i) temporary delays caused by closing the transfer books of the Trustee or a Securities Issuer, (ii) the payment of fees, taxes and applicable charges, and (iii) compliance with any U.S. laws or governmental regulations relating to the Receipts or to the withdrawal of the Underlying Securities. Without limitation of the foregoing, the Trustee shall not knowingly accept for deposit under the Depositary Trust Agreement any Securities required to be registered under the provisions of the Securities Act of 1933, as amended, for the public offer and sale thereof in the United States unless a registration statement is in effect as to such Securities for such offer and sale. Section 2.9. Lost Certificates, Etc. In case any certificate ---------------------- evidencing Receipts shall be mutilated, destroyed, lost or stolen, the Trustee shall execute and deliver a new certificate of like tenor in exchange and substitution for such mutilated certificate upon cancellation thereof, or in lieu of and in substitution for such destroyed, lost or stolen certificate. Before the Trustee shall execute and deliver a new certificate in substitution for a destroyed, lost or stolen certificate, the Owner thereof shall have (a) -14- filed with the Trustee (i) a request for such execution and delivery before the Trustee has notice that the Receipts have been acquired by a bona fide purchaser and (ii) a sufficient indemnity bond, and (b) satisfied any other reasonable requirements imposed by the Trustee. Section 2.10. Cancellation and Destruction of Surrendered ------------------------------------------- Certificates. All certificates evidencing Receipts Surrendered to the Trustee - ------------ shall be canceled by the Trustee. The Trustee is authorized to destroy certificates so canceled. Section 2.11. Reconstitution Events. (a) If any class of Securities --------------------- ceases to be outstanding as a result of a merger, consolidation or other corporate combination of the Securities Issuer and Section 4.8 does not apply, the Trustee shall, if it has actual knowledge of such event, to the extent lawful and feasible and subject to Section 4.10, distribute any securities which shall be received by the Trustee in exchange for or in conversion of or in respect of Underlying Securities which are not Securities issued by a Securities Issuer to the Owners in proportion to their ownership of Receipts. Effective on the date that such Securities cease to be outstanding, such class of Securities shall cease to be part of the Securities which must be deposited for issuance of Receipts. (b) If any class of Securities is delisted from trading on its primary exchange or market and is not listed for trading on another national securities exchange or through NASDAQ within five business days from the date of such delisting, the Trustee shall, if it has actual knowledge of such event, to the extent lawful and feasible and subject to Section 4.10, distribute the Underlying Securities of such class to the Owners in proportion to their ownership of Receipts. Effective on the date of such distribution, -15- such class of Securities shall cease to be a part of the securities which must be deposited for issuance of Receipts. (c) In the event that any Securities Issuer no longer has a class of common stock registered under section 12 of the Securities Exchange Act of 1934, as amended, the Trustee shall, if it has actual knowledge of such event, to the extent lawful and feasible and subject to Section 4.10, distribute the Underlying Securities of such Securities Issuer to the Owners in proportion to their ownership of Receipts. Effective on the date of such distribution, such class of Securities shall cease to be part of the securities which must be deposited for issuance of Receipts. (d) If the Commission determines that a Securities Issuer is an investment company under the Investment Company Act of 1940, and the Trustee has actual knowledge of such Commission determination, then the Trustee shall, to the extent lawful and feasible and subject to Section 4.10, distribute the Underlying Securities of such Securities Issuer to the Owners in proportion to their ownership of Receipts. Effective on the date of such distribution, such class of Securities shall cease to be part of the securities which must be deposited for issuance of Receipts. -16- ARTICLE 3 CERTAIN OBLIGATIONS OF OWNERS OF RECEIPTS Section 3.1. Filing Proofs, Certificates and Other Information. Any ------------------------------------------------- Person presenting Securities for deposit or any Owner of Receipts may be required from time to time to file with the Trustee such proof of citizenship or residence, exchange control approval, or such information relating to the registration on the books of any Securities Issuer or Securities Registrar, if applicable, to execute such certificates and to make such representations and warranties, as the Trustee may require. The Trustee may withhold the Delivery or registration of transfer of any Receipts or the delivery of any Underlying Securities until such proof or other information is filed or such certificates are executed or such representations and warranties made. Section 3.2. Liability of Owner for Taxes. If any tax or other ---------------------------- charge shall become payable with respect to any Receipts or any Underlying Securities represented thereby, such tax or other charge shall be payable by the Owner of such Receipts to the Trustee. The Trustee shall refuse to effect any registration of transfer of such Receipts or any withdrawal of Underlying Securities represented by such Receipt until such payment is made, and may withhold any dividends or other distributions, or may sell for the account of the Owner thereof Underlying Securities constituting any multiples of the securities which must be deposited for issuance of Receipts, and may apply such dividends or other distributions or the proceeds of any such sale in payment of such tax or other charge and the Owner of such Receipt shall remain liable for any deficiency. Section 3.3. Warranties on Deposit of Shares. ------------------------------- -17- Every Person depositing Securities under the Depositary Trust Agreement shall be deemed thereby to represent and warrant that such Securities and each certificate therefor are validly issued and fully paid, that the person making such deposit is duly authorized to do so and that at the time of delivery, such Securities are free and clear of any lien, pledge, encumbrance, right, charge or claim (other than the rights created by the Depositary Trust Agreement). Every such person shall also be deemed to represent that such Securities are not, and Receipts representing such Securities would not be, Restricted Securities. Such representations and warranties shall survive the deposit of Securities, issuance of Receipts or termination of the Depositary Trust Agreement. ARTICLE 4 THE UNDERLYING SECURITIES Section 4.1. Cash Distributions. Whenever the Trustee shall receive ------------------ any cash dividend or other cash distribution on any Underlying Securities, the Trustee shall distribute the amount thus received (net of the fees of the Trustee as provided in Section 5.6, if applicable) to the Owners entitled thereto, in proportion to the number of Receipts held by them respectively; provided, however, that in the event that the respective Securities Issuer or - -------- ------- the Trustee shall be required to withhold and does withhold from such cash dividend or such other cash distribution an amount on account of taxes, the amount distributed to the Owners shall be reduced accordingly. The Trustee shall distribute only such amount, however, as can be distributed without attributing to any Owner a fraction of one cent. Any such fractional amounts shall be rounded to the nearest whole cent and so distributed to Owners entitled thereto. Section 4.2. Distributions Other Than Cash or Securities. Subject to ------------------------------------------- the provisions of Sections 4.8 and 5.6, whenever the Trustee shall receive any distribution other than a distribution described in Sections 4.1, 4.3 or 4.4 or any distribution -18- which would otherwise be distributed hereunder except that the Trustee deems such distribution not to be lawful and feasible, the Trustee shall, subject to Section 4.10, cause the securities or property received by it to be distributed to the Owners entitled thereto, in proportion to the number of Receipts held by them respectively, in any manner that the Trustee may deem equitable and practicable for accomplishing such distribution; provided, however, that if in the opinion of the Trustee such distribution - -------- ------- cannot be made proportionately among the Owners entitled thereto, or if for any other reason (including, but not limited to, any requirement that a Securities Issuer or the Trustee withhold an amount on account of taxes or other governmental charges or that such securities must be registered under the Securities Act of 1933 in order to be distributed to Owners) the Trustee deems such distribution not to be feasible, the Trustee shall adopt such method as it deems equitable and practicable for the purpose of effecting such distribution, including, but not limited to, the public or private sale of the securities or property thus received, or any part thereof, and the net proceeds of any such sale (net of the fees of the Trustee as provided in Section 5.6) shall be distributed by the Trustee to the Owners entitled thereto as in the case of a distribution received in cash. Section 4.3. Distributions in Securities. If any distribution upon --------------------------- any Underlying Securities consists of a dividend in, or free distribution of, Securities, the Trustee shall, to the extent lawful and feasible, retain such Securities under the Depositary Trust Agreement, and, in such case, the (i) the amount of such Securities so retained in respect of each Receipt shall be added to the classes and quantities of securities which must be deposited for issuance of Receipts and (ii) the number of Receipts in an Issuance Denomination may be increased or decreased by the Trustee to the lowest multiple of 100 Receipts such that no fractional shares are thereby represented in such Issuance Denomination. -19- Section 4.4. Rights Offerings. (a) If a Securities Issuer offers ---------------- or causes to be offered to the holders of any Underlying Securities any rights to subscribe for additional Securities or other securities, the Trustee shall have discretion in accordance with this Section 4.4 as to the procedure to be followed in making such rights available to any Owners or in disposing of such rights on behalf of Owners and making the net proceeds available to Owners or, if by the terms of such rights offering or for any other reason (including the absence of an effective registration statement covering the distribution of securities underlying the rights), the Trustee may not make such rights available to any Owners or dispose of such rights and make the net proceeds available to Owners, then the Trustee shall allow the rights to lapse. (b) The Trustee will not offer rights to Owners unless both the rights and the securities to which such rights relate are either exempt from registration under the Securities Act of 1933 with respect to a distribution to all Owners or are registered under the provisions of such Act. (c) The Trustee shall not be responsible for any failure to determine that it may be lawful or feasible to make such rights available to Owners in general or any Owner in particular. Section 4.5. Fixing of Record Date. Whenever any cash dividend or --------------------- other cash distribution shall become payable or any distribution other than cash shall be made, or whenever the Trustee receives notice of any meeting of or solicitation of proxies from holders of any Underlying Securities, or whenever a fee shall be charged by the Trustee under Section 5.6, or whenever for any reason there is a reconstitution or other event under the Depositary Trust Agreement that causes a change in the composition of the securities which must be deposited for issuance of Receipts, or whenever the Trustee -20- shall find it necessary or convenient in respect of any matter, the Trustee shall fix a record date (a) for the determination of the Owners who shall be (i) entitled to receive such dividend or distribution or the net proceeds of the sale thereof, (ii) entitled to give instructions to the Trustee for the exercise of voting rights at any such meeting or solicitation or (iii) required to pay such fee, or (b) on or after which each Receipt will represent such changed group of Securities. In the case of subsections (a)(i) and (a)(ii) of this Section 4.5, the Trustee shall use its reasonable efforts to ensure that, to the extent practicable, the record date set hereunder will be the same as the record date set by the Securities Issuer. Subject to the terms and conditions of the Depositary Trust Agreement, the Owners on such record date shall be entitled, as the case may be, to receive the amount distributable by the Trustee with respect to such dividend or other distribution or the net proceeds of sale thereof, or to give voting instructions, or to act in respect of any other such matter, or shall be obligated to pay such fee. Section 4.6. Reports. The Trustee shall, to the extent lawful, ------- forward to Owners any reports and communications, including any proxy statement or other soliciting material, received from a Securities Issuer which are received by the Trustee as the holder of the Underlying Securities or its appointed agent, unless such reports and communications have been forwarded directly to Owners by such Securities Issuer or its appointed agent. Section 4.7. Voting Instructions for Underlying Securities. Upon --------------------------------------------- receipt by the Trustee or its appointed agent of notice of any meeting of, or solicitation of proxies from, holders of Underlying Securities, the Trustee shall, to the extent lawful, mail to the Owners a notice, the form of which notice shall be in the sole discretion of the Trustee, which shall contain (a) such information as is contained in such notice of meeting or solicitation, and (b) a statement that the Owners as of the close of business on a specified -21- record date will be entitled, subject to applicable law and the provisions of the corporate documents of the Securities Issuer, to instruct the Trustee as to the exercise of the voting rights, if any, or giving of proxies, as applicable, in respect of the amount of Underlying Securities represented by their respective Receipts and (c) a statement as to the manner in which such instructions may be given. Upon the written request of an Owner of a Receipt on such record date, received on or before the date established by the Trustee for such purpose, the Trustee shall endeavor, insofar as practicable, to vote or cause to be voted, or to give a proxy, as applicable, in respect of the amount of Underlying Securities represented by such Receipt in accordance with the instructions set forth in such request. The Trustee shall not vote or attempt to exercise the right to vote that attaches to, or give a proxy with respect to, Underlying Securities other than in accordance with such instructions. Section 4.8. Changes Affecting Underlying Securities. (a) In --------------------------------------- circumstances where the provisions of Sections 2.11 and 4.3 do not apply, upon any change in nominal value, change in par value, split-up, consolidation or any other reclassification of any Underlying Securities, or upon any recapitalization, reorganization, merger or consolidation or sale of assets affecting the issuer of any Underlying Security, if the relevant Securities Issuer survives such event, the Trustee shall, to the extent lawful and feasible, retain such Securities under the Depositary Trust Agreement, and, in such case, the (A) the amount of such Securities so retained in respect of each Receipt shall be added to the classes and quantities of securities which must be deposited for issuance of Receipts and (B) the number of Receipts in an Issuance Denomination may be increased or decreased by the Trustee to the lowest multiple of 100 Receipts such that no fractional shares are thereby represented in such Issuance Denomination. -22- (b) Securities of any class which are surrendered by the Trustee in connection with any such conversion or exchange shall, effective on the date of such surrender, no longer be part of the securities which must be deposited for issuance of Receipts. In any such case, or in the case of an event to which Section 2.11 applies, the Trustee may call for the Surrender of outstanding certificates evidencing Receipts to be exchanged for new certificates specifically describing any applicable change in the classes and quantities of securities which must be deposited for issuance of Receipts. Section 4.9. Withholding. In the event that the Trustee determines ----------- that any distribution in property (including Securities and rights to subscribe therefor) is subject to any tax or other charge which the Trustee is obligated to withhold, notwithstanding anything to the contrary in these Standard Terms or the applicable Depositary Trust Agreement, the Trustee may by public or private sale dispose of all or a portion of such property (including Securities and rights to subscribe therefor) in such amounts and in such manner as the Trustee deems necessary and practicable to pay any such taxes or charges and the Trustee shall distribute the net proceeds of any such sale after deduction of such taxes or charges to the Owners entitled thereto in proportion to the number of Receipts held by them respectively. Section 4.10. Limitation on Distributions. Notwithstanding any --------------------------- provision of the Depositary Trust Agreement which requires or permits the Trustee to distribute or Deliver any securities to Owners, the Trustee shall not distribute to any Owner any fraction of a share. Instead, the Trustee shall, to the extent lawful, sell the aggregate of such fractions and distribute the net proceeds to the Owners entitled thereto as in the case of a distribution received in cash. -23- ARTICLE 5 THE TRUSTEE AND THE INITIAL DEPOSITOR Section 5.1. Maintenance of Office and Transfer Books by the Trustee. ------------------------------------------------------- (a) Until termination of this Depositary Trust Agreement in accordance with its terms, the Trustee shall maintain in the Borough of Manhattan, The City of New York, facilities for the execution and Delivery, registration, registration of transfers and Surrender of Receipts in accordance with the provisions of these Standard Terms and the applicable Depositary Trust Agreement. (b) The Trustee shall keep books for the registration of Receipts and transfers of Receipts which at all reasonable times shall be open for inspection by the Owners. (c) The Trustee may close the transfer books at any time or from time to time. (d) If any Receipts evidenced thereby are listed on one or more stock exchanges in the United States, the Trustee shall act as Registrar or appoint a registrar or one or more co-registrars for registry of such receipts in accordance with any requirements of such exchange or exchanges. Section 5.2. Prevention or Delay in Performance by the Initial ------------------------------------------------- Depositor or the Trustee. Neither the Initial Depositor nor the Trustee nor any - ------------------------ of their respective directors, employees, agents or affiliates shall incur any liability to any Owner or Beneficial Owner of any Receipt, if by reason of any provision of any present or future -24- law or regulation of the United States or any other country, or of any governmental or regulatory authority or stock exchange, or by reason of any provision, present or future, of the corporate documents of any Securities Issuer, or by reason of any provisions of any securities issued or distributed by any Securities Issuer, or any offering or distribution thereof, or by reason of any act of God or war or other circumstances beyond its control, the Initial Depositor or the Trustee shall be prevented or forbidden from, or be subject to any civil or criminal penalty on account of, doing or performing any act or thing which by the terms of these Standard Terms or the applicable Depositary Trust Agreement it is provided shall be done or performed; nor shall the Initial Depositor or the Trustee incur any liability to any Owner or Beneficial Owner of any Receipt by reason of any non-performance or delay, caused as aforesaid, in the performance of any act or thing which by the terms of these Standard Terms or the applicable Depositary Trust Agreement it is provided shall or may be done or performed, or by reason of any exercise of, or failure to exercise, any discretion provided for in these Standard Terms or the applicable Depositary Trust Agreement. Where, by the terms of an offering or distribution to which Sections 2.11, 4.2 or 4.4 applies, or for any other reason, it is not lawful and feasible to make such distribution or offering available to Owners, and the Trustee may not dispose of such distribution or offering on behalf of such Owners and make the net proceeds available to such Owners, then the Trustee shall not make such distribution or offering available to Owners and shall allow any rights, if applicable, to lapse. Section 5.3. Obligations of the Initial Depositor and the Trustee. ---------------------------------------------------- (a) Neither the Initial Depositor nor the Trustee assumes any obligation nor shall they be subject to any liability under these Standard Terms or the applicable Depositary Trust Agreement to any Owner or Beneficial Owner of any Receipt (including, without limitation, liability with respect to the validity or worth of the Underlying Securities), -25- except that each agrees to perform its respective obligations specifically set forth in these Standard Terms and the applicable Depositary Trust Agreement without negligence or bad faith. (b) Neither the Initial Depositor nor the Trustee shall be under any obligation to prosecute any action, suit or other proceeding in respect of any Underlying Securities or in respect of the Receipts. (c) Neither the Initial Depositor nor the Trustee shall be liable for any action or non-action by it in reliance upon the advice of or information from legal counsel, accountants, any person presenting Securities for deposit, any Owner or any other person believed by it in good faith to be competent to give such advice or information. (d) The Trustee shall not be liable for any acts or omissions made by a successor Trustee whether in connection with a previous act or omission of the Trustee or in connection with any matter arising wholly after the resignation of the Trustee, provided that in connection with the issue out of which such potential liability arises the Trustee performed its obligations without negligence or bad faith while it acted as Trustee. (e) The Trustee shall not be responsible for any failure to carry out any instructions to vote any of the Underlying Securities, or for the manner in which any such vote is cast or the effect of any such vote, provided that any such action or non-action is without negligence or bad faith. (f) Except as specifically provided in Section 4.6, the Trustee shall have no obligation to monitor or to obtain any information concerning the business or -26- affairs of any Securities Issuer or to advise Owners or Beneficial Owners of any event or condition affecting any Securities Issuer. (g) The Trustee shall have no obligation to comply with any direction or instruction from any Owner or Beneficial Owner regarding Receipts except to the extent specifically provided in these Standard Terms or any applicable Depositary Trust Agreement. (h) The Trustee shall be a fiduciary under these Standard Terms and the applicable Depositary Trust Agreement; provided, however, that the fiduciary -------- ------- duties and responsibilities and liabilities of the Trustee shall be limited by, and shall be only those specifically set forth in, these Standard Terms and the applicable Depositary Trust Agreement. Section 5.4. Resignation or Removal of the Trustee; Appointment of ----------------------------------------------------- Successor Trustee. (a) The Trustee may at any time resign as Trustee hereunder - ----------------- by written notice of its election so to do, delivered to the Initial Depositor, and such resignation shall take effect upon the appointment of a successor Trustee and its acceptance of such appointment as hereinafter provided. (b) If at any time the Trustee is in material breach of its obligations under the Depositary Trust Agreement and the Trustee fails to cure such breach within 30 days after receipt by the Trustee of written notice from the Initial Depositor or Owners of 25% or more of the outstanding Receipts specifying such default and requiring the Trustee to cure such default, the Initial Depositor, acting on behalf of the Owners, may remove the Trustee by written notice delivered to the Trustee in the manner provided -27- in Section 7.5, and such removal shall take effect upon the appointment of the successor Trustee and its acceptance of such appointment as hereinafter provided. (c) In case at any time the Trustee acting hereunder shall resign or be removed, the Initial Depositor, acting on behalf of the Owners, shall use its reasonable efforts to appoint a successor Trustee, which shall be a bank or trust company having an office in the Borough of Manhattan, The City of New York. Every successor Trustee shall execute and deliver to its predecessor and to the Initial Depositor, acting on behalf of the Owners, an instrument in writing accepting its appointment hereunder, and thereupon such successor Trustee, without any further act or deed, shall become fully vested with all the rights, powers, duties and obligations of its predecessor; but such predecessor, nevertheless, upon payment of all sums due it and on the written request of the Initial Depositor, acting on behalf of the Owners, shall execute and deliver an instrument transferring to such successor all rights and powers of such predecessor hereunder, shall duly assign, transfer and deliver all right, title and interest in the Underlying Securities to such successor, and shall deliver to such successor a list of the Owners of all outstanding Receipts. The Initial Depositor or any such successor Trustee shall promptly mail notice of the appointment of such successor Trustee to the Owners. (d) Any corporation into or with which the Trustee may be merged, consolidated or converted shall be the successor of such Trustee without the execution or filing of any document or any further act. Section 5.5. Indemnification. (a) The Initial Depositor shall indemnify --------------- the Trustee, its directors, employees, agents and affiliates against, and hold each of them harmless from, any loss, liability, cost, expense or judgment (including, but not limited to, the fees and expenses of counsel) (collectively "Indemnified Amounts") which is -28- incurred by any of them and which arises out of acts performed or omitted pursuant to the provisions of these Standard Terms or any Depositary Trust Agreement, as the same may be amended, modified or supplemented from time to time, or any filings with or submissions to the Commission in connection with or with respect to such Receipts (which by way of illustration and not by way of limitation, include any registration statement and any amendments or supplements thereto filed with the Commission or any periodic reports or updates that may be filed under the Securities Exchange Act of 1934, as amended, or any failure to make any filings or submissions to the Commission which are required to be made in connection with or with respect to such Receipts), except that the Initial Depositor shall not have any obligations under this Section 5.5(a) to pay Indemnified Amounts incurred as a result of and attributable to (i) the negligence or bad faith of, or material breach of the terms of this Agreement by, the Trustee, (ii) written information regarding the name and address of the Trustee furnished in writing to the Initial Depositor (and not materially changed or altered) expressly for use in the registration statement filed with the Commission relating to the Receipts, or (iii) any misrepresentations or omissions made by a Depositor (other than Initial Depositor) in connection with such Depositor's offer and sale of Receipts. (b) The Trustee shall indemnify the Initial Depositor, its directors, employees, agents and affiliates against, and hold each of them harmless from, any Indemnified Amounts (i) caused by the negligence or bad faith of the Trustee or (ii) arising out of any written information regarding the name and address of the Trustee furnished in writing to the Initial Depositor (and not materially changed or altered) expressly for use in the registration statement filed with the Commission relating to the Receipts. -29- [(c) If the indemnification provided for in this Section 5.5 is unavailable or insufficient to hold harmless the indemnified party under subsection (a) or (b) above, then the indemnifying party shall contribute to the Indemnified Amounts referred to in subsection (a) or (b) above (i) in such proportion as is appropriate to reflect the relative benefits received by the Initial Depositor on the one hand and the Trustee on the other hand from the offering of the Receipts which are the subject of the action or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Initial Depositor on the one hand and the Trustee on the other hand in connection with the action, statement or omission which resulted in such Indemnified Amount as well as any other relevant equitable considerations. The relative benefits received by the Initial Depositor on the one hand and the Trustee on the other shall be deemed to be in the same proportions as the total commissions from the offering of the Receipts which are the subject of the action (before deducting expenses) received by the Initial Depositor bear to the total fees received by the Trustee from the offering of such Receipts. The relative fault shall be determined by reference to, among other things, whether any untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact which from which the action arises relates to information supplied by the Initial Depositor or the Trustee and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission or the act or omission from which the action arises. The amount of Indemnified Amounts referred to in the first sentence of this subsection (c) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any action or claim which is the subject of this subsection (c).] -30- Section 5.6. Charges of Trustee. The following charges shall be ------------------ incurred by any party depositing or withdrawing Securities or by any party Surrendering Receipts or to whom Receipts are Delivered or any Owner, as applicable: (1) taxes and charges and other fees payable in respect of the Underlying Securities assessed by third-party custodians, depositories, transfer agents, and other service providers in the ordinary course of their respective businesses (whether in connection with the deposit of Securities or withdrawal of Underlying Securities or otherwise), (2) a fee of $10 or less per 100 Receipts for the execution and Delivery of Receipts pursuant to Section 2.5, and the Surrender of Receipts pursuant to Section 2.7, and (3) a fee which shall accrue on the first day of each calendar quarter at a rate of $.02 or less per Receipt per quarter for the Trustee's services as such under the Depositary Trust Agreement (which fee shall be assessed against Owners of record as of the date or dates set by the Trustee in accordance with Section 4.5 and shall be collected at the Trustee's discretion by deducting such fee from one or more cash dividends or other cash distributions); provided, however, that with -------- ------- respect to the aggregate fee accrued in any calendar year under this clause (3) with respect to each Receipt, the Trustee will waive that portion which exceeds the total cash dividends and other cash distributions the record date for which falls in such calendar year and payable with respect to such Receipt. Section 5.7. Retention of Trust Documents. The Trustee is authorized ---------------------------- to destroy those documents, records, bills and other data compiled during the term of the Depositary Trust Agreement at the times permitted by the laws or regulations governing the Trustee. -31- Section 5.8. Federal Securities Law Filings. The Initial ------------------------------ Depositor shall (i) prepare and file a registration statement with the Commission and take such action as is necessary from time to time to qualify the Receipts for offering and sale under the federal securities laws of the United States, including the preparation and filing of amendments and supplements to such registration statement, (ii) promptly notify the Trustee of any amendment or supplement to the registration statement or prospectus, of any order preventing or suspending the use of any prospectus, of any request for the amending or supplementing of the registration statement or prospectus or if any event or circumstance occurs as a result of which the registration statement or prospectus, as then amended or supplemented, would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, (iii) provide the Trustee from time to time with copies, including copies in electronic form, of the prospectus, as amended and supplemented, in such quantities as the Trustee may request and (iv) prepare and file any periodic reports or updates that may be required under the Securities Exchange Act of 1934, as amended. Section 5.9. Prospectus Delivery. The Trustee shall, if required by ------------------- the federal securities laws of the United States, in any manner permitted by such laws, deliver at the time of issuance of Receipts, a copy of the relevant prospectus, as amended and supplemented at such time, to each Person depositing Underlying Securities into the Trust for issuance of Receipts. ARTICLE 6 AMENDMENT AND TERMINATION -32- Section 6.1. Amendment. The Trustee and the Initial Depositor may --------- amend any provisions of the Depositary Trust Agreement without the consent of any Owner. Any amendment that imposes or increases any fees or charges (other than taxes and other charges, registration fees or other such expenses), or that otherwise prejudices any substantial existing right of the Owners will not become effective until 30 days after notice of such amendment is given to the Owners. Every Owner and Beneficial Owner, at the time any amendment so becomes effective, shall be deemed, by continuing to hold any Receipt or an interest therein, to consent and agree to such amendment and to be bound by the Depositary Trust Agreement as amended thereby. In no event shall any amendment impair the right of the Owner of any Receipt to Surrender such Receipt and receive therefor the Underlying Securities represented thereby, except in order to comply with mandatory provisions of applicable law. Section 6.2. Early Termination. (a) The Trust shall terminate by ----------------- the Trustee mailing notice of such termination to the Owners of all Receipts then outstanding at least 30 days prior to the date set for termination if any of the following occurs: (i) The Trustee is notified that the Receipts are delisted from a national securities exchange and are not approved for listing on another national securities exchange within 5 business days of their delisting; (ii) Owners of at least 75% of the outstanding Receipts notify the Trustee that they elect to terminate the Trust; or (iii) 60 days shall have expired after the Trustee shall have delivered to the Initial Depositor and the Owners a written notice of its election to resign and a -33- successor trustee shall not have been appointed and accepted its appointment as provided in Section 5.4. (b) On and after the date of termination, the Owner of a Receipt will, upon (i) Surrender of such Receipt at the Corporate Trust Office of the Trustee, (ii) payment of the fee of the Trustee for the Surrender of Receipts referred to in Section 2.7, and (iii) payment of any applicable taxes or charges, be entitled to Delivery, to him or upon his order, of the amount of Underlying Securities evidenced by such Receipt. If any Receipts shall remain outstanding after the date of termination, the Trustee thereafter shall discontinue the registration of transfers of Receipts, shall suspend the distribution of dividends or other distribution to the Owners thereof, and shall not give any further notices or perform any further acts under these Standard Terms or the applicable Depositary Trust Agreement, except that the Trustee shall continue to collect dividends and other distributions pertaining to Underlying Securities and hold the same uninvested and without liability for interest, shall sell rights as provided in these Standard Terms or the applicable Depositary Trust Agreement, and shall continue to deliver Underlying Securities, together with any dividends or other distributions received with respect thereto and the net proceeds of the sale of any rights or other property, in exchange for Receipts Surrendered to the Trustee (after deducting or upon payment of, in each case, the fee of the Trustee set forth in 5.6 for the Surrender of Receipts, any expenses for the account of the Owner of such Receipts in accordance with the terms and conditions of the Depositary Trust Agreement, and any applicable taxes or charges). At any time after the expiration of one year following the date of termination, the Trustee may sell the Underlying Securities then held hereunder and may thereafter hold uninvested the net proceeds of any such sale, together with any other cash then held by it hereunder, unsegregated and without liability for interest, for the pro rata benefit of the Owners of Receipts which --- ---- have not theretofore been Surrendered, such Owners thereupon becoming -34- general creditors of the Trustee with respect to such net proceeds. After making such sale, the Trustee shall be discharged from all obligations under these Standard Terms with respect to the Receipts and the applicable Depositary Trust Agreement, except to account for such net proceeds and other cash (after deducting, in each case, the fee of the Trustee for the Surrender of Receipts, any fees of the Trustee due and owing from the Owner of such Receipts pursuant to Section 5.6, any expenses for the account of the Owner of such Receipts in accordance with the terms and conditions of the Depositary Trust Agreement, and any applicable taxes or governmental charges). Upon the termination of the applicable Depositary Trust Agreement, the Initial Depositor shall be discharged from all obligations under such Depositary Trust Agreement except for its obligations to the Trustee under Section 5.5. ARTICLE 7 MISCELLANEOUS Section 7.1. Counterparts. These Standard Terms and each Depositary ------------ Trust Agreement may be executed in any number of counterparts, each of which shall be deemed an original and all of such counterparts shall constitute one and the same instrument. Copies of these Standard Terms and the applicable Depositary Trust Agreement shall be filed with the Trustee and shall be open to inspection by any Owner of a Receipt during business hours. Section 7.2. Third-Party Beneficiaries. These Standard Terms and -------------------------- each Depositary Trust Agreement are for the exclusive benefit of the respective parties hereto and thereto, and shall not be deemed to give any legal or equitable right, remedy or claim whatsoever to any other person. -35- Section 7.3. Severability. In case any one or more of the ------------ provisions contained in these Standard Terms or the applicable Depositary Trust Agreement or in the Receipts should be or become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein or therein shall in no way be affected, prejudiced or disturbed thereby. Section 7.4. Owners and Beneficial Owners as Parties; Binding ------------------------------------------------ Effect. The Owners, Beneficial Owners and Depositors from time to time shall be parties to the applicable Depositary Trust Agreement and shall be bound by all of the terms and conditions hereof and thereof and of the Receipts by their acceptance of Receipts or any interest therein or by their depositing Securities, as the case may be. Section 7.5. Notices. (a) Any and all notices to be given to the ------- Initial Depositor shall be deemed to have been duly given if personally delivered or sent by mail or cable, telex or facsimile transmission confirmed by letter, addressed to Merrill Lynch, Pierce, Fenner & Smith Incorporated, World Financial Center, New York, New York 10281, Attention: Director, Customized Investments, or any other place to which the Initial Depositor may have transferred its principal office with notice to the Trustee. (b) Any and all notices to be given to the Trustee shall be deemed to have been duly given if personally delivered or sent by mail or cable, telex or facsimile transmission confirmed by letter, addressed to The Bank of New York, 101 Barclay Street, 22-W, New York, New York 10286, Attention: ADR Administration, or any other place to which the Trustee may have transferred its Corporate Trust Office with notices to the Initial Depositor. -36- (c) Any and all notices to be given to any Owner shall be deemed to have been duly given if personally delivered or sent by mail or cable, telex or facsimile transmission confirmed by letter, addressed to such Owner at the address of such Owner as it appears on the transfer books of the Trustee, or, if such Owner shall have filed with the Trustee a written request that notices intended for such Owner be mailed to some other address, at the address designated in such request. (d) Delivery of a notice sent by mail or cable, telex or facsimile transmission shall be deemed to be effected at the time when a duly addressed letter containing the same (or a confirmation thereof in the case of a cable, telex or facsimile transmission) is deposited, postage prepaid, in a post-office letter box. The Trustee may, however, act upon any cable, telex or facsimile transmission received by them, notwithstanding that such cable, telex or facsimile transmission shall not subsequently be confirmed by letter as aforesaid. Section 7.6. Governing Law. This Depositary Trust Agreement and the ------------- Receipts shall be interpreted and all rights hereunder and thereunder and provisions hereof and thereof shall be governed by the substantive laws (but not the choice of law rules) of the State of New York. -37- IN WITNESS WHEREOF, MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED and THE BANK OF NEW YORK have duly executed these Standard Terms as of the day and year first set forth above. MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED By: -------------------------------- Steven G. Budurtha First Vice President THE BANK OF NEW YORK, as Trustee By: -------------------------------- Name: Title: -38- EXHIBIT A [NAME OF TRUST] [FORM OF] DEPOSITARY TRUST AGREEMENT DEPOSITARY TRUST AGREEMENT dated as of __________ (this "Depositary Trust Agreement"), between MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, a Delaware corporation (the "Initial Depositor"), THE BANK OF NEW YORK, a New York banking corporation, as trustee (the "Trustee"), and all Holders and Beneficial Owners (each as hereinafter defined) from time to time of Depositary Trust Receipts issued hereunder and all Depositors (as hereinafter defined) from time to time. Section 1. Incorporation of Standard Terms. The Standard Terms for ------------------------------- Depositary Trust Agreements agreed to as of ____________, 1999 (the "Standard Terms"), between the Initial Depositor and the Trustee are hereby incorporated by reference into and made a part of this Depositary Trust Agreement. If there is any conflict between the provisions of this Depositary Trust Agreement and the Standard Terms, the provisions of this Depositary Trust Agreement shall control. Section 2. Securities to be Deposited. Initially, the securities -------------------------- which must be deposited for issuance of one Receipt and which shall be represented thereby shall be as follows: Quantity which must be deposited Issuer and Title of Security per Receipt ---------------------------- --------------------- [Issuer and title of security] [Quantity] [Issuer and title of security] [Quantity] ; provided, however, that if an event to which Section 2.11 of the Standard -------- ------- Terms applies or an event described in Sections 4.3 or 4.8 of the Standard Terms occurs, the definition of the securities that must be deposited for issuance of one Receipt shall be changed as provided in such Sections, if applicable. Section 3. Creation and Declaration of Trust; Termination Date. The --------------------------------------------------- trust created hereby shall be known as [Name of Trust], for which the Trustee, ------------- or the Initial Depositor to the extent provided herein, may conduct the business of the Trust, make and A-1 execute contracts, and sue and be sued. [The termination date of the Trust will be December 31, 2039]. Section 4. Closing. The "Closing Date" shall be [specify date]. ------- ------------ IN WITNESS WHEREOF, MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED and THE BANK OF NEW YORK have duly executed this agreement as of the day and year first set forth above. All Owners and Beneficial Owners shall become parties hereto upon acceptance by them of Receipts issued in accordance with the terms hereof or any interest therein, and all Depositors shall become parties hereto upon depositing any Securities hereunder. MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED By: --------------------------------- Name: Title: THE BANK OF NEW YORK, as Trustee By: --------------------------------- Name: Title: A-2 EXHIBIT B [Form of Receipt] THE RECEIPTS EVIDENCED HEREBY REPRESENT RIGHTS WITH RESPECT TO UNDERLYING SECURITIES (AS DEFINED IN THE DEPOSITARY TRUST AGREEMENT REFERRED TO HEREIN) HELD BY THE TRUST AND DO NOT EVIDENCE AN OBLIGATION OF, OR AN INTEREST IN, AND ARE NOT GUARANTEED BY THE INITIAL DEPOSITOR OR THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THE RECEIPTS NOR THE UNDERLYING SECURITIES ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR ANY OTHER PERSON. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE AGENT AUTHORIZED BY THE ISSUER FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. B-1 DEPOSITARY TRUST RECEIPTS ISSUED BY [NAME OF TRUST] REPRESENTING [COMMON STOCK] OF [LIST COMPANIES HERE] THE BANK OF NEW YORK, as Trustee No. CUSIP NO. THE BANK OF NEW YORK, as Trustee (hereinafter called the "Trustee"), hereby certifies that CEDE & CO., as nominee of the Depositary Trust Company, or registered assigns, IS THE OWNER OF * Depositary Trust Receipts issued by [Name of Trust], each representing the securities described in the within- - -------------- mentioned Depositary Trust Agreement. At the date hereof, each Receipt represents the right to receive the following securities: Quantity Initially Issuer and Title Represented by of Security Each Receipt ------------------------------------------ ------------------------------------------ ------------------------------------------ ------------------------------------------ which are deposited under the Depositary Trust Agreement referred to herein at the Corporate Trust Office of the Trustee. The specification of the securities represented by each Receipt is subject to change as provided in the Depositary Trust Agreement. The Trustee's Corporate Trust Office is located at a different address than its principal executive office. Its Corporate Trust Office is located at 101 Barclay Street, New York, New York 10286, and its principal executive office is located at One Wall Street, New York, New York 10286. THE TRUSTEE'S CORPORATE TRUST OFFICE ADDRESS IS 101 BARCLAY STREET, NEW YORK, NEW YORK 10286 - ------------------ * That number of Receipts held at The Depository Trust Company at any given point in time. B-2 (1) THE DEPOSITARY TRUST AGREEMENT. ------------------------------ This Receipt is issued upon the terms and conditions set forth in the Depositary Trust Agreement, dated as of _________, 1999 (the "Depositary Trust Agreement"), agreed to by and among the Initial Depositor, the Trustee, all Owners and Beneficial Owners from time to time of Receipts issued thereunder and all Depositors. By becoming an Owner or Beneficial Owner, or by depositing Securities, such Person agrees to become a party to the Depositary Trust Agreement and become bound by all the terms and conditions thereof. The Depositary Trust Agreement sets forth the rights of Owners and the rights and duties of the Trustee in respect of the Securities deposited thereunder and any and all other securities, property and cash from time to time received in respect of such Securities and held thereunder (such Securities, other securities, property, and cash are herein called "Underlying Securities"). Copies of the Depositary Trust Agreement are on file at the Trustee's Corporate Trust Office in New York City. The statements made on the face and reverse of this Receipt are summaries of certain provisions of the Depositary Trust Agreement and are qualified by and subject to the detailed provisions of the Depositary Trust Agreement, to which reference is hereby made. Capitalized terms not defined herein shall have the meanings set forth in the Depositary Trust Agreement. (2) SURRENDER OF RECEIPTS AND WITHDRAWAL OF SECURITIES. -------------------------------------------------- Upon Surrender at the Corporate Trust Office of the Trustee of a Round Lot of Receipts or integral multiples thereof for the purpose of withdrawal of the Underlying Securities represented thereby, and upon payment of the fee of the Trustee in connection with the Surrender of Receipts as provided in Section 5.6 of the Standard Terms and payment of all taxes and charges payable in connection with such Surrender and withdrawal of the Underlying Securities, and subject to the terms and conditions of the applicable Depositary Trust Agreement, including, without limitation, Section 4.10 thereof, the Owner of such Receipts shall be entitled to Delivery of the amount of Underlying Securities at the time represented by such Receipts. Delivery of such Underlying Securities may be made by (i) Delivery of Securities to such Owner or as ordered by such Owner and (ii) any available form of delivery of any other securities, property and cash to which such Owner is then entitled to such Owner or as ordered by such Owner. The Trustee shall only deliver whole Underlying Securities upon Surrender of Receipts representing such Underlying Securities. (3) REGISTRATION OF TRANSFERS, SPLIT-UPS AND COMBINATIONS OF CERTIFICATES; ---------------------------------------------------------------------- LIMITATIONS. ----------- The transfer of ownership of Receipts evidenced by this certificate is registrable on the books of the Trustee at its Corporate Trust Office by the Owner hereof in person or by a duly authorized attorney, upon Surrender of this certificate evidencing Receipts, B-3 properly endorsed or accompanied by proper instruments of transfer, and duly stamped as may be required by the laws of the State of New York and of the United States of America. This certificate evidencing Receipts may be split up into other such certificates, each evidencing any integral multiple of a Round Lot of Receipts, or may be combined with other certificates evidencing Receipts into one such certificate, in each case evidencing the same aggregate number of Receipts as the certificate or certificates Surrendered. As a condition precedent to the Delivery, registration of transfer, split- up, combination or Surrender (including, for the avoidance of doubt, any Surrender in connection with an exchange) of any Receipt or withdrawal of any Underlying Securities, the Trustee or Registrar may require payment from the Depositor of Securities or the presentor of the Receipts of a sum sufficient to reimburse it for any tax or other charge and any stock transfer or registration fee with respect thereto (including any such tax or charge and fee with respect to Securities being deposited or withdrawn) and payment of any applicable fees as herein provided, may require the production of proof satisfactory to it as to the identity and genuineness of any signature and may also require compliance with any regulations the Trustee may establish consistent with the provisions of the Depositary Trust Agreement, including, without limitation, Section 2.8 of the Standard Terms. The Delivery of Receipts against deposits of Securities, the registration of transfer of Receipts or the Surrender of Receipts for the purpose of withdrawal of Underlying Securities may be suspended, generally or in particular instances, during any period when the transfer books of the Trustee are closed or the transfer books of a Securities Issuer are closed or if any such action is deemed necessary or advisable by the Trustee at any time or from time to time for any reason, subject to the provisions of the following sentence. Notwithstanding any other provision of any applicable Depositary Trust Agreement or the Receipts, the Surrender of Receipts and withdrawal of Underlying Securities may not be suspended subject to only (i) temporary delays caused by closing the transfer books of the Trustee or a Securities Issuer, (ii) the payment of fees, taxes and similar charges, and (iii) compliance with any U.S. laws or governmental regulations relating to the Receipts or to the withdrawal of the Underlying Securities. Without limitation of the foregoing, the Trustee shall not knowingly accept for deposit under the Depositary Trust Agreement any Securities required to be registered under the provisions of the Securities Act of 1933, as amended, for the public offer and sale thereof in the United States unless a registration statement is in effect as to such Securities for such offer and sale. (4) RECONSTITUTION EVENTS --------------------- B-4 If any class of Securities ceases to be outstanding as a result of a merger, consolidation or other corporate combination of the Securities Issuer and Section 4.8 of the Standard Terms does not apply, the Trustee shall, if it has actual knowledge of such event, to the extent lawful and feasible and subject to Section 4.10 of the Standard Terms, distribute any securities which shall be received by the Trustee in exchange for or in conversion of or in respect of Underlying Securities which are not Securities issued by a Securities Issuer to the Owners in proportion to their ownership of Receipts. Effective on the date that such Securities cease to be outstanding, such class of Securities shall cease to be part of the securities which must be deposited for issuance of Receipts. (b) If any class of Securities is delisted from trading on its primary exchange or market and is not listed for trading on another national securities exchange or through NASDAQ within five business days from the date of such delisting, the Trustee shall, if it has actual knowledge of such event, to the extent lawful and feasible and subject to Section 4.10 of the Standard Terms, distribute the Underlying Securities of such class to the Owners in proportion to their ownership of Receipts. Effective on the date of such distribution, such class of Securities shall cease to be a part of the securities which must be deposited for issuance of Receipts. (c) In the event that any Securities Issuer no longer has a class of common stock registered under section 12 of the Securities Exchange Act of 1934, as amended, the Trustee shall, if it has actual knowledge of such event, to the extent lawful and feasible and subject to Section 4.10 of the Standard Terms, distribute the Underlying Securities of such Securities Issuer to the Owners in proportion to their ownership of Receipts. Effective on the date of such distribution, such class of Securities shall cease to be part of the securities which must be deposited for issuance of Receipts. (d) If the Commission determines that a Securities Issuer is an investment company under the Investment Company Act of 1940, and the Trustee has actual knowledge of such Commission determination, then the Trustee shall, to the extent lawful and feasible and subject to Section 4.10 of the Standard Terms, distribute the Underlying Securities of such Securities Issuer to the Owners in proportion to their ownership of Receipts. Effective on the date of such distribution, such class of Securities shall cease to be part of the securities which must be deposited for issuance of Receipts. (5) LIABILITY OF OWNER FOR TAXES. ---------------------------- If any tax or other governmental charge shall become payable with respect to any Receipts or any Underlying Securities represented thereby, such tax or other governmental charge shall be payable by the Owner hereof to the Trustee. The Trustee B-5 shall refuse to effect any registration of transfer of such Receipts or any withdrawal of Underlying Securities represented by such Receipt until such payment is made, and may withhold any dividends or other distributions, or may sell for the account of the Owner hereof Underlying Securities constituting any multiples of the securities which must be deposited for issuance of Receipts, and may apply such dividends or other distributions of the proceeds of any such sale in payment of such tax or other charge and the Owner hereof shall remain liable for any deficiency. (6) WARRANTIES ON DEPOSIT OF SECURITIES. ----------------------------------- Every Person depositing Securities under the Depositary Trust Agreement shall be deemed thereby to represent and warrant that such Receipts and each certificate therefor are validly issued and fully paid, that the person making such deposit is duly authorized to do so and that at the time of delivery, such Securities are free and clear of any lien, pledge, encumbrance, right, charge or claim (other than the rights created by the Depositary Trust Agreement). Every such person shall also be deemed to represent that such Securities are not, and Receipts representing such Securities would not be, Restricted Securities. Such representations and warranties shall survive the deposit of Securities, issuance of Receipts or termination of the Depositary Trust Agreement. (7) FILING PROOFS, CERTIFICATES AND OTHER INFORMATION. ------------------------------------------------- Any person presenting Securities for deposit or any Owner of a Receipt may be required from time to time to file with the Trustee such proof of citizenship or residence, exchange control approval, or such information relating to the registration on the books of any Securities Issuer or Securities Registrar, if applicable, to execute such certificates and to make such representations and warranties, as the Trustee may require. The Trustee may withhold the Delivery or registration of transfer of any Receipts or the delivery of any Underlying Securities until such proof or other information is filed or such certificates are executed or such representations and warranties made. (8) CHARGES OF TRUSTEE. The following charges shall be incurred by any party ------------------ depositing or withdrawing Securities or by any party Surrendering Receipts or to whom Receipts are Delivered or any Owner, as applicable: (1) taxes and charges and other fees payable in respect of the Underlying Securities assessed by third-party custodians, depositories, transfer agents, and other service providers in the ordinary course of their respective businesses (whether in connection with the deposit of Securities or withdrawal of Underlying Securities or otherwise), (2) a fee of $10 or less per 100 Receipts for the execution and Delivery of Receipts pursuant to Section 2.5 of the Standard Terms, and the Surrender of Receipts pursuant to Section 2.7 Standard Terms, and (3) a fee which shall accrue on the first day of each calendar quarter at a rate of $.02 or less per Receipt per quarter for the Trustee's services as such under the Depositary Trust Agreement (which fee shall be assessed against Owners of B-6 record as of the date or dates set by the Trustee in accordance with Section 4.5 of the Standard Terms and shall be collected at the Trustee's discretion by deducting such fee from one or more cash dividends or other cash distributions); provided, however, that with respect to the aggregate -------- ------- fee accrued in any calendar year under this clause (3) with respect to each Receipt, the Trustee will waive that portion which exceeds the total cash dividends and other cash distributions the record date for which falls in such calendar year and payable with respect to such Receipt. (9) TITLE TO RECEIPTS. ----------------- It is a condition of the Receipts and every successive Owner of the Receipts by accepting or holding a certificate for Receipts consents and agrees, that title to such certificate (and the Receipts evidenced thereby) , when properly endorsed or accompanied by proper instruments of transfer, is transferable by delivery with the same effect as in the case of a negotiable instrument under the laws of New York; provided, however, that the Trustee, -------- ------- notwithstanding any notice to the contrary, may treat the person in whose name Receipts are registered on the books of the Trustee as the absolute owner thereof for the purpose of determining the person entitled to distribution or dividends or other distributions or to any notice provided for in the Depositary Trust Agreement and for all other purposes. (10) VALIDITY OF RECEIPTS. -------------------- Receipts shall not be entitled to any benefits under the Depositary Trust Agreement or be valid or obligatory for any purpose, unless a certificate evidencing such Receipts shall have been executed by the Trustee by the manual or facsimile signature of a duly authorized signatory of the Trustee and, if a Registrar for the Receipts shall have been appointed, countersigned by the manual or facsimile signature of a duly authorized officer of the Registrar. (11) REPORTS; INSPECTION OF TRANSFER BOOKS. ------------------------------------- The issuer of each class of Securities is subject to the periodic reporting requirements of the Securities Exchange Act of 1934 and, accordingly, files certain reports with the Securities and Exchange Commission (herein called the "Commission"). Such reports will be available for inspection and copying at the public reference facilities maintained by the Commission located at 450 Fifth Street, NW, Washington, DC 20549. The Trustee shall, to the extent lawful, forward to Owners, any reports and communications, including any proxy statement or other soliciting material, received from a Securities Issuer which are received by the Trustee as the holder of the Underlying Securities, unless such reports and communications have been forwarded directly to Owners by such Securities Issuer. B-7 The Trustee shall keep books for the registration of Receipts and transfers of Receipts which at all reasonable times shall be open for inspection by the Owners. (12) DIVIDENDS AND DISTRIBUTIONS. --------------------------- Whenever the Trustee shall receive any cash dividend or other cash distribution on any Underlying Securities, the Trustee shall, subject to the Depositary Trust Agreement, distribute the amount thus received (net of the fees of the Trustee as provided in the Depositary Trust Agreement, if applicable) to the Owners of Receipts entitled thereto; provided, however, that in the event -------- ------- that the respective Securities Issuer or the Trustee shall be required to withhold and does withhold from such cash dividend or such other cash distribution in respect of any Underlying Securities an amount on account of taxes, the amount distributed to the Owners of the Receipts representing such Underlying Securities shall be reduced accordingly. Subject to the provisions of Sections 4.8 and 5.6 of the Standard Terms, whenever the Trustee shall receive any distribution other than a distribution described in Sections 4.1, 4.3 or 4.4 of the Standard Terms or a distribution which would otherwise be distributed under the Depositary Trust Agreement except that the Trustee deems such distribution not to be lawful and feasiable, the Trustee shall, subject to Section 4.10 of the Standard Terms, cause the securities or property received by it to be distributed to the Owners of Receipts entitled thereto, in any manner that the Trustee may deem equitable and practicable for accomplishing such distribution; provided, however, that if -------- ------- in the opinion of the Trustee such distribution cannot be made proportionately among the Owners of Receipts entitled thereto, or if for any other reason (including, but not limited to, any requirement that a Securities Issuer or the Trustee withhold an amount on account of taxes or other governmental charges or that such securities must be registered under the Securities Act of 1933 in order to be distributed to Owners) the Trustee deems such distribution not to be feasible, the Trustee shall adopt such method as it deems equitable and practicable for the purpose of effecting such distribution, including, but not limited to, the public or private sale of the securities or property thus received, or any part thereof, and the net proceeds of such sale (net of the fees of the Trustee as provided in Section 5.6 of the Standard Terms) shall be distributed by the Trustee to the Owners entitled thereto as in the case of a distribution received in cash. If any distribution upon any Underlying Securities consists of a dividend in, or free distribution of, Securities, the Trustee shall, to the extent lawful and feasible, retain such Securities under the Depositary Trust Agreement, and, in such case, the (i) the amount of such Securities so retained in respect of each Receipt shall be added to the classes and quantities of securities which must be deposited for issuance of Receipts and (ii) the number of Receipts in an Issuance Denomination may be increased B-8 or decreased by the Trustee to the lowest multiple of 100 Receipts such that no fractional shares are thereby represented in such Issuance Denomination. In the event that the Trustee determines that any distribution in property (including Securities and rights to subscribe therefor) is subject to any tax or other charge which the Trustee is obligated to withhold, notwithstanding anything to the contrary in the Standard Terms or the applicable Depositary Trust Agreement, the Trustee may by public or private sale dispose of all or a portion of such property (including Securities and rights to subscribe therefor) in such amounts and in such manner as the Trustee deems necessary and practicable to pay any such taxes or charges and the Trustee shall distribute the net proceeds or any such sale after deduction of such taxes or charges to the Owners entitled thereto. (13) RIGHTS OFFERINGS. ---------------- (a) If a Securities Issuer offers or cause to be offered to the holders of any Underlying Securities any rights to subscribe for additional Securities or other securities, the Trustee shall have discretion in accordance with Section 4.4 of the Standard Terms as to the procedure to be followed in making such rights available to any Owners or in disposing of such rights on behalf of Owners and making the net proceeds available to Owners or, if by the terms of such rights offering or for any other reason (including the absence of an effective registration statement covering the distribution of securities underlying the rights), the Depositary may not make such rights available to any Owners or dispose of such rights and make the net proceeds available to Owners, then the Trustee shall allow the rights to lapse. (b) The Trustee will not offer rights to Owners unless both the rights and the securities to which such rights relate are either exempt from registration under the Securities Act of 1933 with respect to a distribution to all Owners or are registered under the provisions of such Act. (c) The Trustee shall not be responsible for any failure to determine that it may be lawful or feasible to make such rights available to Owners in general or any Owner in particular. (14) RECORD DATES. ------------ Whenever any cash dividend or other cash distribution shall become payable or any distribution other than cash shall be made, or whenever the Trustee receives notice of a meeting of or solicitation of proxies from holders of any Underlying Securities, or whenever a fee shall be changed by the Trustee under Section 5.6 of the Standard Terms, or whenever for any reason there is a reconstitution or other event under the Depositary Trust Agreement that causes a change in the composition of the Securities which must be B-9 deposited for issuance of Receipts, or whenever the Trustee shall find it necessary or convenient in respect of any matter, the Trustee shall fix a record date (a) for the determination of the Owners who shall be (i) entitled to receive such dividend, distribution or rights or the net proceeds of the sale thereof or (ii) entitled to give instructions for the exercise of voting rights at any such meeting or solicitation, or (iii) required to pay such fee, or (b) on or after which each Receipt will represent such changed group of Securities, subject to the provisions of the Depositary Trust Agreement. In the case of subsections (a)(i) and (a)(ii) of this Article (13), the Trustee shall use its reasonable efforts to ensure that, to the extent practicable, the record date set under the Depositary Trust Agreement will be the same as the record date set by the Securities Issuer. (15) VOTING OF UNDERLYING SECURITIES. ------------------------------- Upon receipt by the Trustee or its appointed agent of notice of any meeting of, or solicitation of proxies from, holders of Underlying Securities, the Trustee shall, to the extent lawful, mail to the Owners a notice which shall contain (a) such information as is contained in such notice of meeting or solicitation, (b) a statement that the Owners of Receipts as of the close of business on a specified record date will be entitled, subject to applicable law and the provisions of the corporate documents of the Securities Issuer, to instruct the Trustee as to the exercise of the voting rights, if any, or giving of proxies, as applicable, in respect of the amount of Underlying Securities represented by their respective Receipts and (c) a statement as to the manner in which such instructions may be given. Upon the written request of an Owner of a Receipt on such record date, received on or before the date established by the Trustee, the Trustee shall endeavor, insofar as practicable, to vote or cause to be voted, or to give a proxy, as applicable, in respect of the amount of Underlying Securities represented by such Receipt in accordance with the instructions set forth in such request. The Trustee shall not vote or attempt to exercise the right to vote that attaches to, or give a proxy with respect to, Underlying Securities other than in accordance with such instructions. (16) CHANGES AFFECTING UNDERLYING SECURITIES. --------------------------------------- (a) In circumstances where the provisions of Sections 2.11 and 4.3 of the Standard Terms do not apply, upon any change in nominal value, change in par value, split-up, consolidation or any other reclassification of any Underlying Securities, or upon any recapitalization, reorganization, merger or consolidation or sale of assets affecting the issuer of any Underlying Security, if the relevant Securities Issuer survives such event, the Trustee shall, to the extent lawful and feasible, retain such Securities under the Depositary Trust Agreement, and, in such case, the (A) the amount of such Securities so retained in respect of each Receipt shall be added to the classes and quantities of Securities which must be deposited for issuance of Receipts and (B) the number of Receipts in an Issuance Denomination may be increased or decreased B-10 by the Trustee to the lowest multiple of 100 Receipts such that no fractional shares are thereby represented in such Issuance Denomination. (b) Securities of any class which are surrendered by the Trustee in connection with any such conversion or exchange shall, effective on the date of such surrender, no longer be part of the securities which must be deposited for issuance of Receipts. In any such case, or in the case of an event to which Section 2.11 of the Standard Terms applies, the Trustee may call for the Surrender of outstanding certificates evidencing Receipts to be exchanged for new certificates specifically describing any applicable change in the classes and quantities of securities which must be deposited for issuance of Receipts. (17) LIABILITY OF THE INITIAL DEPOSITOR AND THE TRUSTEE. -------------------------------------------------- Neither the Initial Depositor nor the Trustee nor any of their respective directors, employees, agents or affiliates shall incur any liability to any Owner or Beneficial Owner of any Receipt, if by reason of any provision of any present or future law or regulation of the United States or any other country, or of any governmental or regulatory authority or stock exchange, or by reason of any act of God or war or other circumstances beyond its control, the Initial Depositor or the Trustee shall be prevented or forbidden from, or be subject to any civil or criminal penalty on account of, doing or performing any act or thing which by the terms of the Standard Terms or the applicable Depositary Trust Agreement it is provided shall be done or performed; nor shall the Initial Depositor or the Trustee incur any liability to any Owner or Beneficial Owner of any Receipt by reason of any non-performance or delay, caused as aforesaid, in the performance of any act or thing which by the terms of the Standard Terms or the applicable Depositary Trust Agreement it is provided shall or may be done or performed, or by reason of any exercise of, or failure to exercise, any discretion provided for in the Standard Terms or the applicable Depositary Trust Agreement. Where, by the terms of an offering or distribution to which Sections 2.11, 4.2 or 4.4 of the Standard Terms applies, or for any other reason, it is not lawful and feasible to make such distribution or offering available to Owners, and the Trustee may not dispose of such distribution or offering on behalf of such Owners and make the net proceeds available to such Owners, then the Trustee shall not make such distribution or offering available to Owners and shall allow any rights, if applicable, to lapse. The Trustee shall not be subject to any liability with respect to the validity or worth of the Underlying Securities. Neither the Initial Depositor nor the Trustee shall be under any obligation to prosecute any action, suit or other proceeding in respect of any Underlying Securities or in respect of the Receipts. Neither the Initial Depositor nor the Trustee shall be liable for any action or non-action by it in reliance upon the advice of or information from legal counsel, accountants, any person presenting Securities for deposit, any Owner or Beneficial Owner, or any other person believed by it in good faith to be competent to give such advice or information. B-11 The Trustee shall not be liable for any acts or omissions made by a successor depositary whether in connection with a previous act or omission of the Trustee or in connection with any matter arising wholly after the resignation of the Trustee, provided that in connection with the issue out of which such potential liability arises the Trustee performed its obligations without negligence or bad faith while it acted as Trustee. The Trustee shall not be responsible for any failure to carry out any instructions to vote any of the Underlying Securities, or for the manner in which any such vote is cast or the effect of any such vote, provided that any such action or non-action is without negligence or bad faith. Except as specifically provided in Section 4.6 of the Standard Terms, the Trustee shall have no obligation to monitor or to obtain any information concerning the business or affairs of any Securities Issuer or to advise Owners or Beneficial Owners of any event or condition affecting any Securities Issuer. The Trustee shall have no obligation to comply with any direction or instruction from any Owner or Beneficial Owner regarding Receipts except to the extent specifically provided in the Standard Terms or any applicable Depositary Trust Agreement. The Trustee shall be a fiduciary under the Standard Terms and the applicable Depositary Trust Agreement; provided, however, that the fiduciary duties and responsibilities and liabilities of the Trustee shall be limited by, and shall be only those specifically set forth in, the Standard Terms and the applicable Depositary Trust Agreement. No disclaimer of liability under the Securities Act of 1933 is intended by any provision of the Depositary Trust Agreement. (18) RESIGNATION OR REMOVAL OF THE TRUSTEE. ------------------------------------- (a) The Trustee may at any time resign as Trustee under the Depositary Trust Agreement by written notice of its election so to do, delivered to the Initial Depositor, and such resignation shall take effect upon the appointment of a successor Trustee and its acceptance of such appointment. (b) If at any time the Trustee is in material breach of its obligations under the Depositary Trust Agreement and the Trustee fails to cure such breach within 30 days after receipt by the Trustee of written notice from the Initial Depositor or the Owners of 25% or more of the outstanding Receipts specifying such default and requiring the Trustee to cure such default, the Initial Depositor, acting on behalf of the Owners, may remove the Trustee by written notice delivered to the Trustee, and such removal shall take effect upon the appointment of the successor Trustee and its acceptance of such appointment. (c) In case at any time the Trustee acting hereunder shall resign or be removed, the Initial Depositor, acting on behalf of the Owners, shall use its reasonable efforts to appoint a successor Trustee, which shall be a bank or trust company having an office in the Borough of Manhattan, The City of New York. B-12 (19) AMENDMENT. --------- The Trustee and the Initial Depositor may amend any provisions of the Depositary Trust Agreement without the consent of any Owner. Any amendment that imposes or increases any fees or charges (other than taxes and other charges, registration fees or other such expenses), or that otherwise prejudices any substantial existing right of the Owners will not become effective until 30 days after notice of such amendment is given to the Owners. Every Owner and Beneficial Owner, at the time any amendment so becomes effective, shall be deemed, by continuing to hold any Receipt or an interest therein, to consent and agree to such amendment and to be bound by the Depositary Trust Agreement as amended thereby. In no event shall any amendment impair the right of the Owner of any Receipt to Surrender such Receipt and receive therefor the Underlying Securities represented thereby, except in order to comply with mandatory provisions of applicable law. B-13 (20) EARLY TERMINATION OF DEPOSITARY TRUST AGREEMENT. ----------------------------------------------- (a) The Trust shall terminate by the Trustee mailing notice of such termination to the Owners of all Receipts then outstanding at least 30 days prior to the date set for termination if any of the following occurs: (i) The Trustee is notified that the Receipts are delisted from a national securities exchange and are not approved for listing on another national securities exchange within 5 business days of their delisting; (ii) Owners of at least 75% of the outstanding Receipts notify the Trustee that they elect to terminate the Trust; or (iii) 60 days shall have expired after the Trustee shall have delivered to the Initial Depositor and the Owners a written notice of its election to resign and a successor trustee shall not have been appointed and accepted its appointment. (b) On and after the date of termination, the Owner of a Receipt will, upon (a) Surrender of such Receipt at the Corporate Trust Office of the Trustee, (b) payment of the fee of the Trustee for the Surrender of Receipts referred to in Section 2.7 of the Standard Terms, and (c) payment of any applicable taxes or charges, be entitled to Delivery, to him or upon his order, of the amount of Underlying Securities evidenced by such Receipt. If any Receipts shall remain outstanding after the date of termination, the Trustee thereafter shall discontinue the registration of transfers of Receipts, shall suspend the distribution of dividends or other distribution to the Owners thereof, and shall not give any further notices or perform any further acts under these Standard Terms or the applicable Depositary Trust Agreement, except that the Trustee shall continue to collect dividends and other distributions pertaining to Underlying Securities and hold the same uninvested and without liability for interest, shall sell rights as provided in these Standard Terms or the applicable Depositary Trust Agreement, and shall continue to deliver Underlying Securities, together with any dividends or other distributions received with respect thereto and the net proceeds of the sale of any rights or other property, in exchange for Receipts Surrendered to the Trustee (after deducting or upon payment of, in each case, the fee of the Trustee set forth in 5.6 of the Standard Terms for the Surrender of Receipts, any expenses for the account of the Owner of such Receipts in accordance with the terms and conditions of the Depositary Trust Agreement, and any applicable taxes or charges). At any time after the expiration of one year following the date of termination, the Trustee may sell the Underlying Securities then held hereunder and may thereafter hold uninvested the net proceeds of any such sale, together with any other cash then held by it hereunder, unsegregated and without liability for interest, for the pro rata benefit of the Owners of Receipts which have not theretofore been - --- ---- Surrendered, such Owners thereupon becoming general creditors of the Trustee with respect to such net proceeds. B-14 After making such sale, the Trustee shall be discharged from all obligations under these Standard Terms with respect to the Receipts and the applicable Depositary Trust Agreement, except to account for such net proceeds and other cash (after deducting, in each case, the fee of the Trustee for the Surrender of Receipts, any fees of the Trustee due and owing from the Owner of such Receipts pursuant to Section 5.6 of the Standard Terms, any expenses for the account of the Owner of such Receipts in accordance with the terms and conditions of the Depositary Trust Agreement, and any applicable taxes or charges). Upon the termination of the applicable Depositary Trust Agreement, the Initial Depositor shall be discharged from all obligations under such Depositary Trust Agreement except for its obligations to the Trustee under Section 5.5 of the Standard Terms. B-15 AMENDMENT NO. 3 TO THE STANDARD TERMS FOR DEPOSITARY TRUST AGREEMENTS Dated as of December __, 2000 AMENDMENT NO. 3 TO THE STANDARD TERMS FOR DEPOSITARY TRUST AGREEMENTS (this "Amendment") dated September 2, 1999 between Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Initial Depositor, and The Bank of New York, as Trustee (the "Standard Terms"). W I T N E S S E T H: WHEREAS, the Initial Depositor wishes to amend the Standard Terms only in respect of the Europe 2001 HOLDRS Trust and the Europe 2001 HOLDRS Trust Depositary Trust Agreement to provide for the inclusion in the Europe 2001 HOLDRS Trust those securities received as a distribution from a Securities Issuer or as consideration in connection with a merger, acquisition or other corporate combination involving a Securities Issuer. NOW, THEREFORE, in consideration of the premises and the mutual covenants contained in this Amendment, the parties hereby agree as follows: Article I DEFINITIONS Section 1.1 Definitions. The following definition is hereby deleted in ------------ its entirety and restated as follows: (a) "Securities" means any shares of a class of securities, including American depositary shares and American depositary receipts and Additional Securities which must be deposited for issuance of Receipts. (b) The following definition is hereby added to the Standard Terms: "Additional Securities" means any securities which are issued to the stockholders of a Securities Issuer pursuant to Sections 2.11(a), 4.3 and 4.8(a), as amended herein, as a dividend or other distribution, if such securities are listed for trading on a U.S. national securities exchange or through Nasdaq NMS. Article II AMENDMENT Section 2.1 Reconstitution Events. Section 2.11(a) is hereby deleted in ---------------------- its entirety and replaced with the following: (a) If any class of Securities ceases to be outstanding as a result of a merger, consolidation or other corporate combination of the Securities Issuer, and, as a result, securities which are not Underlying Securities or Additional Securities are received by the Trustee in exchange for, in conversion of or in respect of the Underlying Securities, and Section 4.8 does not apply, the Trustee shall, if it has actual knowledge of such event, to the extent lawful and feasible and subject to Section 4.10, distribute any such securities which shall be received by the Trustee to the Owners in proportion to their ownership of Receipts. Effective on the date that such Securities cease to be outstanding, such class of Securities shall cease to be part of the securities which must be deposited for issuance of Receipts. Section 2.2 Distributions in Securities. Section 4.3 is hereby deleted ---------------------------- in its entirety and replaced with the following: If any distribution by a Securities Issuer consists of a dividend in, or free distribution of, Securities or Additional Securities, the Trustee shall, to the extent lawful and feasible, retain such Securities or Additional Securities under the Depositary Trust Agreement, and, in such case, (i) the amount of such Securities or Additional Securities so retained in respect of each Receipt shall be added to the classes and quantities of securities which must be deposited for issuance of Receipts and (ii) the number of Receipts in an Issuance Denomination may be increased or decreased by the Trustee to the lowest multiple of 100 Receipts such that no fractional shares are thereby represented in such Issuance Denomination. Section 2.3 Changes Affecting Underlying Securities. Section 4.8(a) is ---------------------------------------- hereby deleted in its entirety and replaced with the following: (a) In circumstances where the provisions of Section 2.11, 4.2 and 4.3 do not apply, upon any change in nominal value, change in par value, split-up, consolidation or any other reclassification of any Underlying Securities, or upon any recapitalization, reorganization, merger or consolidation or sale of assets affecting the issuer of any Underlying Security, regardless of whether the Securities Issuer survives, the Trustee shall, to the extent lawful and feasible, retain any Securities or Additional Securities under the Depository Trust Agreement, and, in such case, (i) the amount of such Securities or Additional Securities so retained in respect of each Receipt shall be added to the classes and quantities of securities which must be deposited for issuance of Receipts and (ii) the number of Receipts in an Issuance Denomination may be increased or decreased by the Trustee to the lowest multiple of 100 Receipts such that no fractional shares are thereby represented in such Issuance Denomination. Article III miscellaneous Section 3.1 Counterparts. This Amendment may be executed in any number ------------- of counterparts, each of which shall be deemed an original and all of such counterparts shall constitute one and the same instrument. Copies of this Amendment, the Standard Terms and the applicable Depositary Trust Agreement shall be filed with the Trustee and shall be open to inspection by any Owner of a Receipt during business hours. Section 3.2 Governing Law. This Amendment shall be interpreted and all -------------- rights hereunder and provisions hereof shall be governed by the substantive laws (but not the choice of law rules) of the State of New York. IN WITNESS WHEREOF, Merrill Lynch, Pierce, Fenner & Smith Incorporated and The Bank of New York have caused this Amendment to be executed by their respective officers thereunto duly authorized, as of the date first set forth above. MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED By:_________________________________ Stephen G. Bodurtha Attorney-in-Fact and First Vice President THE BANK OF NEW YORK, as Trustee By:_________________________________ Joanne DiGiovanni Vice President EX-5.1 3 0003.txt OPINION OF SHEARMAN & STERLING RE: VALIDITY EXHIBIT 5.1 December 1, 2000 Merrill Lynch, Pierce, Fenner & Smith Incorporated 250 Vesey Street New York, New York 10281 Merrill Lynch, Pierce, Fenner & Smith Incorporated Europe 2001 HOLDRS/SM/ Trust Registration Statement on Form S-1 ------------------------------------- Ladies and Gentlemen: We are acting as counsel to Merrill Lynch, Pierce, Fenner & Smith Incorporated, a Delaware corporation (the "Initial Depositor"), and as special counsel to the Europe 2001 HOLDRS/SM/ Trust (the "Trust") in connection with the preparation and filing with the Securities and Exchange Commission (the "Commission") of the Registration Statement on Form S-1, as amended from time to time and filed by the Initial Depositor (the "Registration Statement"), of which the prospectus forms a part (the "Prospectus"), for the registration under the Securities Act of 1933, as amended (the "Securities Act"), of 1,000,000,000 Europe 2001 HOLDRS/SM/ (the "HOLDRS/SM/") to be issued by the Trust. In this capacity, we have examined (a) a signed copy of the Registration Statement and (b) a copy of the depositary trust agreement between The Bank of New York, as trustee (the "Trustee"), and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as initial depositor (the "Depositary Trust Agreement"). We have also examined originals, or copies certified or otherwise identified to our satisfaction, of such other corporate records of the Initial Depositor, such other certificates and advice of public officials and of officers of the Initial Depositor, and such other agreements, instruments and documents as we have deemed necessary as a basis for the opinions expressed below. In such examination we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals, and the conformity with the originals of all documents submitted to us as copies. As to questions of fact material to such opinions, we have relied upon such certificates and advice. The opinions set forth below are also based upon the assumptions that: (i) the Registration Statement, as finally amended (including any post-effective amendments), has become effective under the Securities Act; (ii) the amount, price, and other principal terms of the HOLDRS/SM/ have been approved by the Board of Directors of the Initial Depositor or an authorized designee thereof; (iii) the Depositary Trust Agreement will be duly authorized, executed and delivered by the parties thereto substantially in the form filed as an exhibit to the Registration Statement; and (iv) the HOLDRS/SM/ will be duly authenticated by the Trustee in accordance with the Depositary Trust Agreement and sold and delivered by the Initial Depositor against payment therefor. Our opinions expressed herein are limited to the laws of the State of New York, and the Federal law of the United States, and we do not express any opinion herein concerning any other law. Based upon and subject to the foregoing, and having regard for such legal considerations as we have deemed relevant, we are of the opinion that the HOLDRS/SM/ will be legally issued, fully paid and nonassessable, will be legal, valid and binding obligations of the Trust, enforceable against the Trust in accordance with their terms, except as enforcement thereof may be limited by bankruptcy, insolvency (including, without limitation, all laws relating to fraudulent transfers), reorganization, moratorium or similar laws affecting the enforcement of creditors' rights generally and except as enforcement thereof is subject to general principles of equity (regardless of whether enforcement is considered in a proceeding at law or in equity). We hereby consent to the use of this opinion as an exhibit to the Registration Statement and to the use of our name under the heading "Legal Matters" in the Prospectus. In giving this consent, we do not thereby concede that we come within the category of persons whose consent is required by the Securities Act or the General Rules and Regulations promulgated thereunder. Very truly yours, /s/ Shearman & Sterling EX-8.1 4 0004.txt OPINION OF SHEARMAN & STERLING RE:TAX CONSEQUENCES EXHIBIT 8.1 December 1, 2000 Merrill Lynch, Pierce, Fenner & Smith Incorporated World Financial Center North Tower--4th Floor New York, New York 10281 Merrill Lynch, Pierce, Fenner & Smith Incorporated Europe 2001 HOLDRS/SM/ Trust Registration Statement on Form S-1 ------------------------------------ Ladies and Gentlemen: We have acted as special Tax Counsel to Merrill Lynch, Pierce, Fenner & Smith Incorporated ("Merrill Lynch"), as Initial Depositor, and the Europe 2001 HOLDRS/SM/ Trust in connection with the preparation and filing of a Prospectus and Registration Statement on Form S-1, as amended from time to time and filed by the Initial Depositor (the "Registration Statement"), of which the prospectus forms a part (the "Prospectus"), for the registration under the Securities Act of 1933, as amended (the "Securities Act"), of 1,000,000,000 Europe 2001 HOLDRS/SM/ (the "HOLDRS/SM/") to be issued by the Trust. Capitalized terms used herein have the meaning ascribed to them in the Prospectus. The HOLDRS/SM/ are being issued pursuant to the Depositary Trust Agreement between the Initial Depositor, The Bank of New York, as trustee (in such capacity, the "Trustee"), other depositors and owners of HOLDRS/SM/ (the "Trust Agreement"). In connection with the preparation of this opinion, we have examined and relied on such documents as we have deemed appropriate, including, inter alia, (i) the Trust Agreement and (ii) the Prospectus. We have made such investigations of law as we have deemed appropriate as a basis for the opinion expressed below. Based on the foregoing, it is our opinion that the Trust will provide for flow through tax consequences since it will be treated as a grantor trust or custodial arrangement for United States Federal income tax purposes. Moreover, the discussion set forth under the caption "Federal Income Tax Consequences" in the Prospectus represents our opinion of and, subject to the limitations contained therein, accurately describes, the principal United States Federal income tax consequences to a holder of HOLDRS/SM/ receipts. The foregoing opinion is based upon provisions of the Internal Revenue Code of 1986, as amended, Treasury regulations and administrative and judicial interpretations as of the date hereof (all of which are subject to change, possibly with retroactive effect, or different interpretations). We consent to the use of this opinion as an exhibit to the Registration Statement and to the reference to our firm under the caption "Legal Matters" in the Prospectus. Very truly yours, /s/ Shearman & Sterling -----END PRIVACY-ENHANCED MESSAGE-----