Exhibit (a)(1)(iv)

 

LOGO

 

Merrill Lynch & Co., Inc.

 

Offer to Exchange

any and all of its

Liquid Yield Option™ Notes due 2032

(Zero Coupon-Floating Rate-Senior)

(“Old LYONs”)

CUSIP No. 590188 A7 3

for

Exchange Liquid Yield Option Notes due 2032

(Zero Coupon-Floating Rate-Senior)

(“New LYONs”)

CUSIP No. 590188 W4 6

 

 

The exchange offer and withdrawal rights will expire at 5:00 P.M., New York City time, on December 9, 2004, unless extended by Merrill Lynch & Co., Inc.

 

To Our Clients:

 

Enclosed for your consideration is the exchange circular, dated November 9, 2004 (as it may be amended or supplemented, the “exchange circular”) and a form of letter of transmittal (as it may be amended or supplemented, the “letter of transmittal”) relating to the exchange offer (the “exchange offer”) made by Merrill Lynch & Co., Inc. (the “Company”) to holders of Old LYONs to tender for exchange any Old LYONs for New LYONs.

 

The Company is inviting holders of Old LYONs to tender for exchange Old LYONs for New LYONs upon the terms and subject to the conditions set forth in the exchange circular. The exchange offer is not conditioned on any minimum number of Old LYONs being tendered but is subject to certain other conditions. See “The Exchange Offer—Conditions to the Exchange Offer” in the exchange circular.

 

This material relating to the exchange offer is being forwarded to you as the beneficial owner of Old LYONs held by us for your account or benefit but not registered in your name. A tender of any Old LYONs may only be made by us as the registered holder and pursuant to your instructions. Therefore, the Company urges beneficial owners of Old LYONs registered in the name of a broker, dealer, commercial bank, trust company or other nominee to contact such registered holder promptly if they wish to tender Old LYONs pursuant to the exchange offer.

 

Accordingly, we request instructions as to whether you wish to tender any or all Old LYONs held by us for your account. We urge you to read carefully the exchange circular, the letter of transmittal and the other materials provided herewith before instructing us to tender your Old LYONs.

 

The terms of the New LYONs and of the Old LYONs are more fully described in the exchange circular. The terms of the New LYONs are similar to the terms of the Old LYONs, but will differ in the following material ways:

 

  Ÿ   the yield will not exceed 5.5% per annum after March 13, 2007 for the Old LYONs or after March 13, 2008 for the New LYONs;

 

  Ÿ   the Company may redeem all or a portion of the Old LYONs at any time on or after March 13, 2007, however the Company may redeem all or a portion of the New LYONs at any time on or after March 13, 2008;
™   Trademark of Merrill Lynch & Co., Inc.

  Ÿ   holders may require the Company to repurchase all or a portion of either the Old LYONs or the New LYONs on March 13, 2005, 2007, 2012, 2017, 2022 and 2027, but additionally holders may require the Company to repurchase all or a portion of the New LYONs on March 13, 2006 and 2008;

 

  Ÿ   holders of Old LYONs surrendered for conversion will receive 13.8213 shares of the Company’s common stock (subject to adjustment), while holders of New LYONs surrendered for conversion will receive the value (calculated as described in the exchange circular) of 13.8213 shares of our common stock (subject to adjustment). This value will be paid in cash in an amount equal to the contingent principal amount of the New LYON on the conversion date and the remainder, at our election, in cash, common stock or a combination thereof;

 

  Ÿ   the Company will pay contingent interest, if any, to holders commencing June 1, 2007 for the Old LYONs and commencing June 1, 2008 for the New LYONs;

 

  Ÿ   during any period when contingent interest is payable, the contingent interest payable each quarter per New LYON will equal an annualized rate of 0.88% of the contingent principal amount (the per bond equivalent of our quarterly current annualized dividend rate of $0.16 per share of common stock multiplied by the conversion rate of 13.8213) of a New LYON on the immediately preceding quarterly yield reset date. This rate will not change in the event we vary our dividend rate or the conversion rate is adjusted. Contingent interest on the Old LYONs, if payable, is variable and based upon dividends that the Company pays on our common stock; and

 

  Ÿ   the conversion rate adjustments applicable to the New LYONs will generally be identical to the conversion rate adjustments applicable to the Old LYONs; however, until March 13, 2008, rather than adjusting for “extraordinary cash dividends”, as is provided in the Old LYONs, the conversion rate of the New LYONs will be adjusted upon the issuance of a cash dividend to all the holders of our common stock to the extent such dividend exceeds $0.16 per share per quarter.

 

The original terms of the Old LYONs provided that, in the event of an early repayment of the Old LYONs at the option of holders, the Company could repay such Old LYONs by delivering, at its option, cash, its common stock or a combination thereof. On November 1, 2004, the Company amended the terms of the Old LYONs to provide that the Company will repay any Old LYONs surrendered for early repurchase at the option of a holder only in cash. This amended term of the Old LYONs will also be a term of the New LYONs.

 

Your instructions to us should be forwarded as promptly as possible in order to permit us to tender Old LYONs on your behalf in accordance with the provisions of the exchange offer. Please note that the exchange offer and withdrawal rights will expire at 5:00 p.m., New York City time, on December 9, 2004, unless extended by the Company.

 

Your attention is directed to the following:

 

  1.   The exchange offer is for any and all Old LYONs for New LYONs.

 

  2.   The exchange offer is subject to certain conditions, which the Company may assert or waive, set forth in the exchange circular.

 

  3.   There are material differences between the New LYONs and the Old LYONs, which are more fully described in the exchange circular.

 

  4.   Exchanging Old LYONs for New LYONs involves risks, which are more fully described in detail in the exchange circular.

 

If you wish to have us tender any or all of your Old LYONs held by us for your account or benefit, please so instruct us by completing, executing and returning to us the instruction form that appears below.

 

The accompanying letter of transmittal is furnished to you for informational purposes only and may not be used by you to tender Old LYONs held by us and registered in our name for your account.

 

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INSTRUCTIONS

 

The undersigned acknowledge(s) receipt of your letter and the enclosed material referred to therein relating to the exchange offer of the Company with respect to the Old LYONs.

 

This will instruct you to tender the principal amount of Old LYONs indicated below held by you for the account or benefit of the undersigned, pursuant to the terms of and conditions set forth in the exchange circular dated November 9, 2004 and the letter of transmittal.

 

 

Liquid Yield Option Notes

due 2032

(CUSIP No. 590188 A73)

which are to be tendered.

   
        Principal Amount        
     
        $                                         
                 

 

     
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