EXHIBIT (4)
THIS NOTE IS A GLOBAL NOTE WITHIN
THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS
REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE THEREOF. UNLESS
AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
CERTIFICATED FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A
WHOLE BY THE DEPOSITORY TRUST COMPANY (THE
“DEPOSITORY”) TO A NOMINEE OF THE DEPOSITORY OR BY THE
DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A
NOMINEE OF SUCH SUCCESSOR DEPOSITORY. UNLESS THIS GLOBAL NOTE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TO THE
COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY), 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.
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REGISTERED No.:
R-1
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CUSIP No.: 59023V712
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PRINCIPAL AMOUNT:
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970,000 Units, $10 principal
amount per Unit ($9,700,000
aggregate principal
amount)
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MERRILL LYNCH & CO.,
INC.
MEDIUM-TERM NOTES, SERIES C
Quarterly Income
Strategic Return Notes ®
(the “Notes”)
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INDEX:
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INDEX
SPONSOR:
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ORIGINAL ISSUE
DATE:
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U.S. Select
Foreign Access 25 Buy-Write Index
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Merrill Lynch
International
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October 1,
2008
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STATED
MATURITY:
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STARTING
VALUE:
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INDEX
ADJUSTMENT FACTOR:
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September 27, 2013
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100.00
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1.00% per
annum
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CALCULATION
AMOUNT:
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EXCHANGE
MONTH:
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DEFAULT
RATE:
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$9.80 per
Unit
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September of each year
from and including 2009
to and including 2012
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The then
current Federal Funds Rate, reset daily, as defined below, reset
daily
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CALCULATION
AGENT:
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DENOMINATIONS:
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SPECIFIED
CURRENCY:
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Merrill Lynch,
Pierce, Fenner & Smith Incorporated
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Integral
multiples of $10 Principal Amount, (each, a
“Unit”)
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United States
dollar
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BUSINESS
DAY:
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VALUATION
DATE:
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BANKING
BUSINESS DAY:
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A day on which
the New York Stock Exchange (the “NYSE”) and The Nasdaq
National Market are open for trading and the level of the Index is
calculated and published.
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September 20,
2013; provided, however, that if a Market Disruption Event (as
defined herein) occurs on that day, the Valuation Date will be the
next succeeding scheduled Business Day on which a Market Disruption
Event has not occurred; provided, further,
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Any day other
than a Saturday or Sunday that is not a day on which banking
institutions in The City of New York are authorized or required by
law, regulation, or executive order to close.
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1
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however, that
if the Ending Value has not been determined (or, if not
determinable, estimated by the Calculation Agent in a manner which
is considered commercially reasonable under the circumstances) by
the second scheduled Business Day prior to the Stated Maturity,
then the Valuation Date will be that second scheduled Business Day
before the Stated Maturity, regardless of the occurrence Market
Disruption Event on that scheduled Business Day.
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2
Merrill Lynch & Co., Inc.,
a Delaware corporation (hereinafter referred to as the
“Company”, which term includes any successor
corporation under the Indenture herein referred to), for value
received, hereby promises to pay to CEDE & CO., or its
registered assigns, the Redemption Amount (as defined below) per
Unit on the Stated Maturity or the Exchange Amount (as defined
below) per Unit on an Exchange Date (as defined below).
Payment or delivery of the
Redemption Amount or Exchange Amount and any interest on any
overdue amount thereof with respect to this Global Note shall be
made at the office or agency of the Company maintained for that
purpose in the Borough of Manhattan, The City of New York, in such
coin or currency of the United States of America as at the time of
payment is legal tender for payment of public and private
debts.
Payment on the Stated
Maturity
Unless previously exchanged prior to
the Stated Maturity, on the Stated Maturity a Holder shall receive
a cash amount per Unit in United States dollars equal to the
Redemption Amount per Unit. The “Redemption Amount” per
Unit shall be determined by the Calculation Agent and shall
equal:
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Calculation Amount ×
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(
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Ending Value
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)
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Starting Value
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For the purpose of determining the
Redemption Amount, the “Ending Value” shall be
determined by the Calculation Agent and shall equal the closing
level of the Index on the Valuation Date.
The level of the Index will be
reduced by the Index Adjustment Factor, deducted daily on the basis
of an actual 365-day year.
Quarterly Payments on the
Notes
The quarterly payments, if any,
shall be paid in cash quarterly on the third Banking Business Day
following each Commencement Date (as defined herein) and on the
Stated Maturity.
A “Commencement Date”
means the first scheduled Business Day following a Quarterly
Payment Determination Date (as defined herein).
A “Quarterly Payment
Determination Date” means the third Friday in each of March,
June, September and December of each year, unless such third Friday
is not a scheduled Business Day, in which case the Quarterly
Payment Determination Date shall be the Business Day immediately
preceding such third Friday.
The “Adjusted Quarterly
Income” for a given Quarterly Calculation Period (as defined
herein) shall equal the sum of Quarterly Income (as defined herein)
from each stock which comprises the Index during that Quarterly
Calculation Period, minus the amount subtracted from
2
the level of the Index due to the application of
the Index Adjustment Factor during that Quarterly Calculation
Period.
The “Quarterly Income”
of a stock which then comprises the Index for a given Quarterly
Calculation Period shall equal the sum of (i) the cash
dividends, if any, paid in respect of that stock during that
Quarterly Calculation Period multiplied by the applicable Share
Multiplier (as defined herein) and (ii) the value of premiums,
if any, in respect of the related call options which are deemed to
be sold on the stocks which then comprise the Index multiplied by
the applicable Share Multiplier.
A “Quarterly Calculation
Period” means a period from and including September 26,
2008 to but excluding the first Commencement Date and from and
including each Commencement Date to but excluding the following
Commencement Date; provided, however, that the final Quarterly
Calculation Period means from and including the final Commencement
Date to but excluding the Stated Maturity.
The “Share Multiplier”
for each stock which then comprises the Index shall be determined
by the Index Sponsor and will equal the number of shares of each
stock which then comprises the Index, based upon the closing price
of that stock on the last Business Day in October, so that on the
last Business Day in October each new stock which then comprises
the Index represents approximately an equal percentage of a value
equal to the applicable Index.
If the Adjusted Quarterly Income for
a given Quarterly Calculation Period is greater than zero on the
related Quarterly Payment Determination Date, the Adjusted
Quarterly Income shall be removed from the level of the Index
effective as of the close of business on the related Quarterly
Payment Determination Date and paid in cash on the third Banking
Business Day following the applicable Commencement Date or on the
Stated Maturity, as applicable.
If the Adjusted Quarterly Income for
a given Quarterly Calculation Period is equal to or less than zero
on the related Quarterly Payment Determination Date, no quarterly
payment shall be made on the Notes.
All determinations made by the
Calculation Agent, absent a determination of manifest error, shall
be conclusive for all purposes and binding on the Company and the
Holders and beneficial owners of this Global Note.
Market Disruption
Event
“Market Disruption
Event” means either of the following events as determined by
the Calculation Agent:
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(A)
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the suspension
of or material limitation on trading, in each case, for more than
two hours of trading, or during the one-half hour period preceding
the close of trading, on any of the primary exchanges on which the
stocks which then comprise the Index trade as determined by the
Calculation Agent (without taking into account any extended or
after-hours trading session), in 20% or more of the stocks which
then comprise the Index or any Successor Index (as defined below);
or
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3
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(B)
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the suspension
of or material limitation on trading, in each case, for more than
two hours of trading, or during the one-half hour period preceding
the close of trading, on any exchange (without taking into account
any extended or after-hours trading session), whether by reason of
movements in price otherwise exceeding levels permitted by the
relevant exchange or otherwise, in option contracts or futures
contracts related to 20% or more of the stocks which then comprise
the Index, the Index or any Successor Index.
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For the purpose of determining
whether a Market Disruption Event has occurred:
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(1)
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a limitation on
the hours in a trading day and/or number of days of trading will
not constitute a Market Disruption Event if it results from an
announced change in the regular business hours of the relevant
exchange;
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(2)
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a limitation on
trading imposed during the course of a day by reason of movements
in price otherwise exceeding levels permitted by the relevant
exchange will constitute a Market Disruption Event;
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(3)
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a decision to
permanently discontinue trading in the relevant futures or options
contracts related to one or more of the stocks which then comprise
the Index, the Index, or any Successor Index, will not constitute a
Market Disruption Event;
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(4)
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a suspension in
trading in a futures or options contract on any stock which then
comprises the Index, the Index, or any Successor Index, by a major
securities market by reason of (a) a price change violating
limits set by that securities market, (b) an imbalance of
orders relating to those contracts or (c) a disparity in bid
and ask quotes relating to those contracts will constitute a
suspension of or material limitation on trading in futures or
options contracts related to any stock which then comprises the
Index, the Index, or any Successor Index;
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(5)
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a suspension of
or material limitation on trading on the relevant exchange will not
include any time when that exchange is closed for trading under
ordinary circumstances; and
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(6)
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for the purpose
of clauses (A) and (B) above, any limitations on trading
during significant market fluctuations under NYSE Rule 80B, or any
applicable rule or regulation enacted or promulgated by the NYSE or
any other self regulatory organization or the Securities and
Exchange Commission of similar scope as determined by the
Calculation Agent, shall be considered
“material”.
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Exchange of the Notes Prior to
the Stated Maturity
This Global Note may be exchanged,
at the option of a Holder, in whole or part (but only in whole
Units), for a cash payment per Unit equal to the Exchange Amount on
any Banking Business Day that occurs during an Exchange Notice
Period (as defined herein) by delivering written notice from the
Holder to the Trustee (in the form of Annex A attached hereto). To
the extent that this Global Note is exchanged in part, the
Principal Amount shall be reduced by the amount so exchanged and
the Principal Amount then outstanding shall be as maintained in the
records of the Trustee.
4
The cash amount received per Unit
upon exchange (the “Exchange Amount”) shall be equal to
the Redemption Amount per Unit, calculated as if the Exchange Date
were the Stated Maturity, except that the Ending Value shall be
equal to the Exchange Price (as defined below).
An ̶
