EXHIBIT 1.1
VOYAGEUR TAX-EXEMPT TRUST
SERIES 1 AND SUBSEQUENT SERIES
STANDARD TERMS AND CONDITIONS OF TRUST
DATED: JANUARY 19, 1995
BETWEEN
VOYAGEUR FUND MANAGERS, INC.
Depositor
AND
INVESTORS FIDUCIARY TRUST COMPANY
Trustee
VOYAGEUR TAX-EXEMPT TRUST
SERIES 1 AND SUBSEQUENT SERIES
STANDARD TERMS AND CONDITIONS OF TRUST
FOR SERIES FOR WHICH INVESTORS FIDUCIARY TRUST COMPANY
MAY ACT AS TRUSTEE
EFFECTIVE
JANUARY 19, 1995
INDEX
ARTICLE I DEFINITIONS.....................................................2
Agreement.................................................................2
Bonds.....................................................................2
Business Day..............................................................2
Certificate...............................................................2
Contract Obligations......................................................5
Depositor.................................................................5
Evaluation Time...........................................................5
Evaluator.................................................................5
Fund......................................................................5
Initial Date of Deposit...................................................5
Insurance.................................................................5
Insurer...................................................................6
Interest Account..........................................................6
Interest Distribution.....................................................6
Interest Distribution Date................................................6
Principal Account.........................................................6
Principal Distribution Date...............................................6
Program Agent.............................................................6
Record Date...............................................................6
Redemption Date...........................................................6
Redemption Price..........................................................6
Reserve Account...........................................................7
Supplement Trust Agreement................................................7
Trust Agreement...........................................................7
Trust Fund or Trust.......................................................7
Trust Fund Evaluation.....................................................7
Trustee...................................................................7
Unit......................................................................7
Unitholder................................................................8
Unit Value................................................................8
ARTICLE II DEPOSIT OF BONDS; ACCEPTANCE OF TRUST; ISSUANCE OF
UNITS; FORM OF CERTIFICATES; PORTFOLIO INSURANCE ..............8
Section 2.01. Deposit of Bonds...........................................8
Section 2.02. Acceptance of Trust........................................9
Section 2.03. Issuance of Units..........................................9
Section 2.04. Form of Certificates......................................10
Section 2.05. Portfolio Insurance.......................................10
ARTICLE III ADMINISTRAT1ON OF FUND.........................................12
Section 3.01. Certain Moneys to be Credited to Interest Account.........12
Section 3.02. Certain Moneys to be Credited to Principal Account.......12
Section 3.03. Establishment of Reserve Account..........................13
Section 3.04. Certain Deductions and Distributions......................13
Section 3.05. Statements and Reports....................................15
Section 3.06. Extraordinary Sale of Bonds...............................17
Section 3.07. Refunding Obligations.....................................18
Section 3.08. Counse1...................................................18
Section 3.09. Action by Trustee Regarding Bonds.........................18
Section 3.10. Trustee Not Required to Adjust Accounts...................19
Section 3.11. Notice of Change in Principal Account.....................19
Section 3.12. Limited Replacement of Special Bonds......................19
Section 3.13. Compensation of Depositor for Supervisory Services........21
ARTICLE IV EVALUATION OF BONDS............................................22
Section 4.01. Evaluation of Bonds.......................................22
Section 4.02. Certain Information to be made Available..................22
Section 4.03. Compensation of the Evaluator.............................23
Section 4.04. Liability of the Evaluator................................23
Section 4.05. Resignation, Removal and Other Matters Relating to the
Evaluator.................................................23
ARTICLE V TRUST FUND EVALUATION..........................................25
Section 5.01. Trust Fund Evaluation.....................................25
Section 5.02. Redemption of Units.......................................25
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ARTICLE VI ISSUANCE, TRANSFER, INTERCHANGE................................27
Section 6.01. Issuance of Certificates..................................27
Section 6.02. Transfer of Units.........................................27
Section 6.03. Replacement of Certificates...............................28
Section 6.04. Form of Certificate.......................................29
ARTICLE VII DEPOSITOR......................................................29
Section 7.01. Certain Matters Regarding Succession......................29
Section 7.02. Liability of Depositor and Indemnification................29
ARTICLE VIII TRUSTEE........................................................30
Section 8.01. Generaal Matters Relating to the Trustee..................30
Section 8.02. Books, Records and Reports................................32
Section 8.03. Reports to Securities and Exchange Commission and
Others....................................................33
Section 8.04. Agreement and List of Bonds on File.......................33
Section 8.05. Compensation of Trustee...................................33
Section 8.06. Resignation, Discharge or Removal of the Trustee;
Successors................................................34
Section 8.07. Qualification of Trustee..................................35
Section 8.08. Collateral................................................35
ARTICLE IX TERMINATION....................................................35
Section 9.01. Procedure Upon Termination................................35
Section 9.02. Notice to Unitholders.....................................37
Section 9.03. Moneys to be Held in Trust Without Interest...............37
Section 9.04. Dissolution of Depositor Not to Terminate.................37
ARTICLE X MISCELLANEOUS PROVISIONS.......................................37
Section 10.01. Amendment and Waiver......................................37
Section 10.02. Initial Costs.............................................38
Section 10.03. Registration (Initial and Current) of Units and Fund......38
Section 10.04. Certain Matters Relating to Unitholders...................38
Section 10.05. Missouri Law to Govern....................................39
Section 10.06. Notices...................................................39
Section 10.07. Severability..............................................39
Section 10.08. Separate and Distinct Series..............................40
EXECUTION ....................................................................42
ACKNOWLEDGMENTS ..............................................................43
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VOYAGEUR TAX-EXEMPT TRUST
SERIES 1 AND SUBSEQUENT SERIES
STANDARD TERMS AND CONDITIONS OF TRUST
for Series for which Investors Fiduciary Trust Company
may act as Trustee
EFFECTIVE January 19, 1995
These Standard Terms and Conditions of Trust, Effective January 19, 1995,
are executed between Voyageur Fund Managers, Inc., as Depositor, and Investors
Fiduciary Trust Company, as Trustee.
WITNESSETH THAT:
In consideration of the premises and of the mutual agreements herein
contained, the Depositor and the Trustee agree as follows:
INTRODUCTION
These Standard Terms and Conditions of Trust shall be applicable to Series
1 and each Series subsequent to the date hereof of Voyageur Tax-Exempt Trust for
which Investors Fiduciary Trust Company acts as Trustee as provided in this
paragraph. For each such series of Voyageur Tax-Exempt Trust to which these
Standard Terms and Conditions of Trust are to be applicable, the Depositor and
the Trustee shall execute a Trust Agreement incorporating by reference these
Standard Terms and Conditions of Trust and designating any exclusion from or
exception to such incorporation by reference for the purposes of that series or
variation of the terms hereof for the purposes of that series and specifying for
that series (i) the name of each Trust Fund, (ii) the Bonds deposited in trust
for each Trust Fund and the number of Units delivered for each Trust Fund by the
Trustee in exchange for the Bonds pursuant to Section 2.01, (iii) the fractional
undivided interest represented by each Unit of each Trust Fund, (iv) the
Interest Distribution Dates, (v) the Principal Distribution Dates, (vi) the
Record Dates, (vii) the Initial Date of Deposit for each Trust Fund, (viii) the
First Settlement Date, (ix) the Evaluator's fee, (x) the liquidation amount for
purposes of Section 8.01(g), (xi) the Trustee's fee, (xii) the supervisory fee
and (xiii) the balance of the Principal Account referenced in Section 3.04(b).
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases, unless
the context otherwise requires, shall have the following meanings:
AGREEMENT
These Standard Terms and Conditions of Trust and all amendments and
supplements hereto and thereto.
BONDS
The interest-bearing tax-exempt obligations, including Contract Obligations
listed in all Schedules to the Trust Agreement or deposited in the Trust Fund
pursuant to Section 2.01(b) and any obligations received in exchange or
substitution for such obligations pursuant to Sections 3.07 or 3.12 hereof, as
may from time to time continue to be held as a part of any Trust Fund.
BUSINESS DAY
Any day other than a Saturday, Sunday or a day on which the New York Stock
Exchange is closed.
CERTIFICATE
Any one of the Certificates manually executed by the Trustee in
substantially the following form with the blanks appropriately filled in:
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Face of Certificate
NUMBER VOYAGEUR TAX-EXEMPT TRUST UNITS
CERTIFICATE OF BENEFICIAL OWNERSHIP
THIS CERTIFIES THAT _____________________________ is the registered owner
of _______ Unit(s) of fractional undivided interest in Voyageur Tax-Exempt Trust
of the above Series (herein referred to as the "TRUST") created under the laws
of the State of Missouri pursuant to the Agreement and the related Trust
Agreement, a copy of which is available at the office of the Trustee. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the aforesaid Agreement and the related Trust Agreement to which
the holder of this Certificate by virtue of the acceptance hereof assents and is
bound. This Certificate is transferable and interchangeable by the registered
owner in person or by his duly authorized attorney at the office of the Trustee
upon surrender of this Certificate properly endorsed or accompanied by a written
instrument of transfer and any other documents that the Trustee may require for
transfer, in form satisfactory to the Trustee, and payment of the fees and
expenses provided in the Trust Agreement.
WITNESS the facsimile signature of the Depositor and the manual signature
of an authorized signatory of the Trustee.
Dated:
VOYAGEUR FUND MANAGERS, INC., INVESTORS FIDUCIARY TRUST COMPANY,
Depositor Trustee, 000 Xxxx 00xx Xxxxxx,
Xxxxxx Xxxx, Xxxxxxxx 00000
By__________________________ By________________________________
Authorized Signature Authorized Signature
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REVERSE OF CERTIFICATE
FORM OF ASSIGNMENT
FOR VALUE RECEIVED _______________________________________ hereby sells,
assigns and transfers unto
____________________
____________________
Please Insert Social Security or Other
Identifying Number of Assignee
______________________________
______________________________
the within Certificate and does hereby irrevocably constitute and appoint
___________________________________________________, attorney, to transfer the
within Certificate on the books of the Trustee, with full power of substitution
in the premises.
Dated: ______________________________
NOTICE: The signature to this assignment must correspond with the name
as written upon the face of the Certificate in every particular,
without alteration or enlargement or any change whatever, and must be
guaranteed by a participant in the Securities Transfer Agents
Medallion Program ("STAMP") or such other signature guarantee program
in addition to, or in substitution for, STAMP, as may be accepted by
the Trustee.
Signature Guaranteed
By__________________________________
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CONTRACT OBLIGATIONS
The Bonds listed in the Schedules of the Trust Agreement which are to
be acquired by any Trust Fund pursuant to contract, contracts for the purchase
of such bonds which have been assigned to the Trustee along with the amount
required for their purchase which have been delivered to the Trustee or Bonds
which the Depositor has contracted to purchase for any Trust Fund pursuant to
Section 3.12 hereof.
DEPOSITOR
Voyageur Fund Managers, Inc. or its successors or any successor Depositor
appointed as herein provided.
EVALUATION TIME
Close of business of the Depositor, unless another meaning is assigned to
it in Part II of the Trust Agreement.
EVALUATOR
Voyageur Fund Managers, Inc. or its successors or any successor Evaluator
appointed as herein provided.
FUND
All Trust Funds outstanding under this Agreement.
INITIAL DATE OF DEPOSIT
The meaning assigned to it in Part II of the Trust Agreement.
INSURANCE
The contract or policy of insurance obtained by the Fund guaranteeing the
payment when due of the principal of and interest on the Bonds held pursuant and
subject to this Agreement, including those Bonds held pursuant and subject to
this Agreement which are also insured by individual policies of insurance which
have been obtained by the issuers of such Bonds, together with the proceeds, if
any, thereof payable to or received by the Trustee for the benefit of the Fund
and the Unitholders thereof except that Insurance shall not include those Bonds
held pursuant and subject to this Agreement which are insured by individual
policies of insurance which have been obtained by the issuers of such Bonds and
which are not also insured by the Insurance (the "PRE-INSURED BONDS").
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INSURER
Any insurance company, its successors and assigns, which is the issuer of
the contract or policy of insurance obtained by the Fund protecting any Trust
Fund and the Unitholders thereof against nonpayment when due of the principal of
and interest on any Bond (except for Pre-Insured Bonds) held by the Trustee as
part of the Fund.
INTEREST ACCOUNT
The account created pursuant to Section 3.01.
INTEREST DISTRIBUTION
The meaning assigned to it in Section 3.04.
INTEREST DISTRIBUTION DATE
The meaning assigned to it in Part II of the Trust Agreement.
PERMANENT INSURANCE
The meaning assigned to it in Section 5.02.
PRINCIPAL ACCOUNT
The account created pursuant to Section 3.02.
PRINCIPAL DISTRIBUTION DATE
The meaning assigned to it in Part II of the Trust Agreement.
PROGRAM AGENT
Program Agent shall mean Investors Fiduciary Trust Company or its
successors, unless a different Program Agent shall be designated by the Trust
Agreement for a particular Trust Fund.
RECORD DATE
The meaning assigned to it in Part II of the Trust Agreement.
REDEMPTION DATE
The meaning assigned to it in Section 5.02.
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REDEMPTION PRICE
The meaning assigned to it in Section 5.02.
RESERVE ACCOUNT
The account created pursuant to Section 3.03.
SUPPLEMENT TRUST AGREEMENT
Shall mean an amendment or supplement to the Trust Agreement executed
pursuant to Section 2.01(b) for the purpose of depositing additional Bonds in
the Trust Fund and issuing additional Units.
TRUST AGREEMENT
The Trust Agreement for the particular series of Voyageur Tax-Exempt Trust
into which these Standard Terms and Conditions of Trust are incorporated.
TRUST FUND OR TRUST
Any one of the separate trusts created by this Agreement and a Trust
Agreement which shall consist of the Bonds and all undistributed interest or
other amounts received or accrued thereon and any undistributed cash held in the
Principal and Interest Accounts or otherwise realized from the sale,
liquidation, redemption or maturity thereof, exclusive of any amounts which may
be on deposit in the Reserve Account.
TRUST FUND EVALUATION
The meaning assigned to it in Section 5.01.
TRUSTEE
Investors Fiduciary Trust Company or its successors or any successor
Trustee appointed as herein provided.
UNIT
The fractional undivided interest in and ownership of an individual
Trust Fund equal initially to the fraction specified in Part II of the Trust
Agreement, the denominator of which fraction shall be (1) increased by the
number of any additional Units issued pursuant to Section 2.03 hereof and (2)
decreased by the number of any such Units redeemed as provided in Section 5.02.
Whenever reference is made herein to the "INTEREST" of a Unitholder in the Trust
Fund or in the Interest or Principal Accounts, it shall mean such
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fractional undivided interest represented by the number of Units, whether or not
evidenced by a Certificate or Certificates, held of record by such Unitholder in
such Trust Fund.
UNITHOLDER
The holder of any Unit as recorded on the books of the Trustee, his legal
representatives and heirs and the successors of any corporation, partnership or
other legal entity which is a holder of any Unit.
UNIT VALUE
The value of the fractional undivided interest in and ownership of any
individual Trust Fund represented by each Unit as determined by a Trust Fund
Evaluation.
Words importing a singular number shall include the plural number in each
case and vice versa, except as the context herein may clearly indicate otherwise
and words importing persons shall include corporations, partnerships and
associations, as well as natural persons. The words "HEREIN", "HEREBY",
"HEREWITH", "HERETOFORE", and other singular words or phrases or references and
associations shall refer to the Agreement in its entirety.
ARTICLE II
DEPOSIT OF BONDS; ACCEPTANCE OF TRUST;
ISSUANCE OF UNITS; FORM OF CERTIFICATES; PORTFOLIO INSURANCE
SECTION 2.01. DEPOSIT OF BONDS. (a) The Depositor, concurrently with the
execution and delivery hereof, hereby grants and conveys all of its right, title
and interest in and to and hereby conveys to and deposits with the Trustee in an
irrevocable Trust the Bonds (together with accrued and unpaid interest thereon)
and confirmations of contracts to purchase Bonds, including Contract
Obligations, listed in the Schedules to the Trust Agreement duly endorsed in
blank or accompanied by all necessary instruments of assignment and transfer in
proper form, to be held, managed and applied by the Trustee as herein provided
for the benefit of each Unitholder to the extent of such Unitholder's interest
in the Trust Fund. The Depositor hereby also delivers to the Trustee a certified
check or checks, cash or cash equivalents or an irrevocable letter or letters of
credit issued by a commercial bank or banks in an amount necessary to consummate
the purchase of any Bonds or Contract Obligations. In the event any Bonds have
not been delivered to the Trustee on or before the close of business of the
Trustee on the day before the date of expiration of any letter or letters of
credit, the Trustee is hereby directed to draw on such letter or letters of
credit unless the Depositor has either extended or replaced such letter or
letters on or before such close of business.
(b) From time to time following the Initial Date of Deposit for a Trust,
the Depositor is hereby authorized, in its discretion, to assign, convey to and
deposit with the Trustee additional Bonds for such Trust, duly endorsed in blank
or accompanied by all
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necessary instruments of assignment and transfer in proper form, to be held,
managed and applied by the Trustee as herein provided. Such deposit of
additional Bonds shall be made, in each case, pursuant to an executed
Supplemental Trust Agreement. Any additional Bonds to be deposited must (1) be
issued by the same issuer; (2) have the same original issue date; (3) have the
same coupon or interest rate; (4) have the same maturity date; (5) have the same
redemption features; and (6) have other legal characteristics as the Bonds
originally deposited in the Trust on the Initial Date of Deposit. The Depositor
in each case shall ensure that each deposit of additional Bonds pursuant to this
Section shall have the same ratio of Bonds (based on principal amount) as
existed on the Initial Date of Deposit for each Trust Fund. Any brokerage fees
related to the purchase of Bonds deposited in the Trust Fund after the Initial
Date of Deposit shall be an expense of such Trust Fund.
(c) The Trustee may deposit a certified check or checks, cash or cash
equivalents, or cash drawn on the irrevocable letter or letters of credit
deposited by the Depositor, to purchase Bonds or Contract Obligations in a
non-interest bearing account for the Trust Fund.
(d) In the event that the purchase of Bonds or Contract Obligations
pursuant to any contract shall not be consummated in accordance with said
contract, and the Depositor does not, on or before the third Business Day prior
to the next following Distribution Date, direct the Trustee to utilize monies
deposited for the purchase of Replacement Bonds or Replacement Contract
Obligations, the Trustee shall credit to the Principal Account referred to in
Section 3.02 the monies, or, if applicable, the monies drawn on an irrevocable
letter of credit, deposited by the Depositor for the purpose of such purchase.
Such funds shall be distributed pursuant to Section 3.04 to Unitholders of
record as of the Record Date next following the failure of consummation of such
purchase. The Depositor shall cause to be refunded to each Unitholder his pro
rata portion of the sales charge levied on the sale of Units to such Unitholder
attributable to such Bond or Contract Obligation. The Depositor shall also pay
to the Trustee, for distribution to the Unitholders, interest on such Bond or
Contract Obligation, computed at the coupon rate, to the date such Bond or
Contract Obligations is removed from the Trust Fund.
(e) The Trustee is hereby irrevocably authorized to effect registration or
transfer of the Bonds in fully registered form to the name of the Trustee or to
the name of its nominee.
SECTION 2.02. ACCEPTANCE OF TRUST. The Trustee hereby accepts the trusts
herein created, and the Trustee declares that it holds and will hold the Trust
Fund as Trustee, in trust upon the trusts herein set forth, for the use and
benefit of the present and future Unitholders and subject to the terms and
conditions of the Trust Agreement and this Agreement.
SECTION 2.03. ISSUANCE OF UNITS. (a) The Trustee hereby acknowledges
receipt of the deposit of the Bonds listed in the Schedules to the Trust
Agreement and referred to in Section 2.01 hereof and, simultaneously with the
receipt of said deposit, has recorded on its books the ownership, by the
Depositor or such other person or persons as may be indicated
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by the Depositor, of the aggregate number of Units specified in the Trust
Agreement and has to or on the order of the Depositor in exchange therefor
delivered documentation evidencing the ownership of the number of Units
specified substantially in the form above recited representing the ownership of
those Units. The Trustee hereby agrees that on the date of any Supplemental
Trust Agreement, it shall acknowledge that the additional Bonds identified
therein have been deposited with it by recording on its books the ownership, by
the Depositor or such other person or persons as may be indicated by the
Depositor, of the aggregate number of Units to be issued in respect of such
additional Bonds so deposited, and shall, if so requested, execute documentation
substantially in the form above recited representing the ownership of an
aggregate number of those Units.
(b) Under the terms and conditions of the Trust Agreement and this
Agreement and at such times as are permitted by the Trustee, Units may also be
held in certificated form. Unitholders may elect to have their Units held in
certificated form by making a written request to the Trustee requesting such
Certificates; provided, that the Trustee is entitled to specify the minimum
denomination of any Certificate issued. The Trustee shall, at the request of the
holder of any Units held in uncertificated form, issue a new Certificate to
evidence such Units and at such time make an appropriate notation in the
registration books of the Trustee. The rights set forth in this Agreement of any
holder of Units held in certificated form shall be the same as those of any
other Unitholder. Certificates may be transferred as provided in Article VI.
SECTION 2.04. FORM OF CERTIFICATES. Each Certificate referred to in Section
2.03 is, and each Certificate hereafter issued shall be, in substantially the
form herein above recited, numbered serially for identification, in fully
registered form, transferable on the books of the Trustee as herein provided,
executed manually by an authorized signature of the Trustee and by a facsimile
signature of an Authorized Officer of the Depositor and dated the date of
execution and delivery by the Trustee.
SECTION 2.05. PORTFOLIO INSURANCE. Concurrently with the delivery to the
Trustee of the Bonds listed in the Schedules to the Trust, the Insurer has
delivered to and deposited with the Trustee the Insurance to protect the Fund
and the Unitholders thereof against nonpayment of principal and interest, when
due, on any Bond or Bonds (except for Pre-Insured Bonds) held by the Trustee in
the portfolio of the Fund.
The Trustee shall take all action deemed necessary or advisable in
connection with the Insurance to continue the Insurance in full force and effect
and shall pay all premiums due thereon, including the initial premium, all in
such manner as in its sole discretion shall appear to result in the most
protection and least expense to such trust.
The Insurance may not be cancelled by the Insurer. However, as of each
Record Date the Trustee shall make the deduction and payment of premiums
prescribed in Section 3.04(a)(6) of this Agreement in order to continue in force
the coverage thus provided. The Insurer's right to the payment of premiums from
funds held by the Trustee in accordance with the terms of the policy is absolute
(except when payment is withheld in good faith by the Trustee in the event of
dispute over the amount thereof), but no failure on
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the part of the Trustee to make such payment of premium or installment thereof
to the Insurer shall result in a cancellation of the Insurance or otherwise
affect the right of any Unitholder under the policy to have any amounts of
principal and interest paid by the Insurer to the Trustee to be held as part of
the Fund when the same are not paid when due by the issuer of a Bond or Bonds
held by the Trustee as part of the Fund.
With each payment of premium or installment thereof, the Trustee shall
notify the Insurer of all Bonds (except for Pre-Insured Bonds) which during the
expiring premium period were redeemed from or sold by the Fund.
At all times during the existence of the Fund the Insurance policy shall
provide for payment by the Insurer or its agent to the Trustee of any amounts of
principal and interest due, but not paid, by the issuer of a Bond (except for
Pre-Insured Bonds). The Trustee shall promptly notify the Insurer or its agent
of any nonpayment or threatened nonpayment of principal or interest and the
Insurer or its agent shall within 30 days after receipt of such notice make
payment to the Trustee of all amounts of principal and interest at this time
due, but not paid.
Payments of principal and interest assumed by the Insurer shall be made as
required by the related Bond or Bonds, except in the event of a sale of any such
Bond or Bonds by the Trustee under Section 3.06, 3.07 or 5.02, or a termination
of this Indenture and the trusts created hereby under Section 8.01, prior to the
final maturity of such Bond or Bonds, in each of which events, upon notice from
the Trustee, the Insurer or its agent shall promptly make payment of the accrued
interest on such Bond or Bonds to the Trustee and shall be relieved of further
obligation to the Trustee thereon.
Upon the making of any payment referred to in the preceding paragraphs, the
Insurer shall succeed to the rights of the Trustee under the Bond or Bonds
involved to the extent of the payments made at that time, or any time subsequent
thereto, and shall continue to make all payments required by the terms of such
Bond or Bonds to the extent that funds are not provided therefor by the issuer
thereof. Upon the payment of any amounts by the Insurer or its agent, occasioned
by the nonpayment thereof by the issuer, the Trustee shall execute and deliver
to the Insurer or its agent any receipt, instrument or document required to
evidence the right of the Insurer in the Bond or Bonds involved to payment of
principal and/or interest thereon to the extent of the payments made by the
Insurer or its agent to the Trustee.
With respect to Pre-Insured Bonds in the Fund, the Trustee shall promptly
notify the insurer of the Pre-Insured Bonds of any nonpayment of principal or
interest on such Pre-Insured Bonds and if such insurer should fail to make
payment to the Trustee within 30 days after receipt of such notice, the Trustee
shall take all action against such insurer and/or the issuer deemed necessary to
collect all amounts of principal and interest at this time due, but not
collected.
The Trustee shall also take such action required under Section 5.02 of
this Agreement with respect to Permanent Insurance, as defined in Section 5.02.
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ARTICLE III
ADMINISTRATION OF FUND
SECTION 3.01. CERTAIN MONEYS TO BE CREDITED TO INTEREST ACCOUNT. The
Trustee shall collect the interest on the Bonds for each Trust Fund as it
becomes payable (including all interest accrued but unpaid prior to the date of
deposit or acquisition of the Bonds hereunder and including that part of the
proceeds of the sale, liquidation, redemption or maturity of any Bonds which
represents accrued interest thereon ), and credit such interest to a separate
account for each Trust Fund to be known as the "Interest Account". The Trustee
is authorized to advance out of its own funds and then cause to be deposited in
and credited to the Interest Account of the Trust Fund any amount necessary to
permit the payment of any Interest Distribution out of the Interest Account
required to be made with respect to such Trust Fund by the Trustee on each
Distribution Date; provided, however, that the Trustee shall be entitled to be
reimbursed without interest out of such Trust Fund for any and all amounts
advanced by it pursuant to this Section 3.0l as interest on the Bonds is
collected.
SECTION 3.02. CERTAIN MONEYS TO BE CREDITED TO PRINCIPAL ACCOUNT. (a) With
respect to each Trust Fund all moneys (except moneys held by the Trustee
pursuant to subsection (b) hereof) other than amounts credited to the Interest
Account received by the Trustee in respect of the Bonds under this Agreement
shall be credited to a separate account for each Trust Fund to be known as the
"Principal Account".
(b) Moneys and/or irrevocable letters of credit required to purchase
Contract Obligations or deposited to secure such purchases are hereby declared
to be held specially by the Trustee for such purchases and shall not be deemed
to be part of the Principal Account until (i) the Depositor fails to timely
purchase a Contract Obligation and has not given the Failed Contract Notice (as
defined in Section 3.12) at which time the moneys and/or letters of credit
attributable to the Contract Obligation not purchased by the Depositor shall be
credited to the Principal Account; or (ii) the Depositor has given the Trustee
the Failed Contract Notice at which time the moneys and/or letters of credit
attributable to failed contracts referred to in such Notice shall be credited to
the Principal Account; provided, however, that if the Depositor also notifies
the Trustee in the Failed Contract Notice (or by separate notice delivered
concurrently with or prior to the Failed Contract Notice) that it has purchased
or entered into a contract to purchase a New Bond (as defined in Section 3.12),
the Trustee shall not credit such moneys and/or letters of credit to the
Principal Account unless the New Bond shall also have failed or is not delivered
by the Depositor within two business days after the settlement date of such New
Bond, in which event the Trustee shall forthwith credit such moneys and/or
letters of credit to the Principal Account. The Trustee shall in any case
forthwith credit to the Principal Account, and/or cause the Depositor to deposit
in the Principal Account, the difference, if any, between the purchase price of
the failed Contract Obligation and the purchase price of the New Bond, together
with any sales charge and accrued interest applicable to such difference and
distribute such moneys to Unitholders pursuant to Section 3.04.
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SECTION 3.03. ESTABLISHMENT OF RESERVE ACCOUNT. From time to time the
Trustee may withdraw from the Interest or Principal Accounts of each Trust Fund
such amounts as it, in its sole discretion, shall deem requisite to establish a
reserve for any applicable taxes or other governmental charges that may be
payable out of such Trust Fund or for indemnification or extraordinary expenses
of the Depositor or Trustee pursuant to Section 7.02, 8.01 or 8.05. Such amounts
so withdrawn shall be credited to a separate account for such Trust Fund which
shall be known as the " Reserve Account." The Trustee shall not be required to
distribute to the Unitholders any of the amounts in the Reserve Account;
provided, however, that if it, in its sole discretion, determines that such
amounts are no longer necessary, then it shall promptly deposit such amounts in
the account from which withdrawn, or if such Trust Fund has been terminated or
shall be in the process of termination, the Trustee, upon such determination,
shall distribute to each Unitholder of such Trust Fund such Unitholder's
interest in the Reserve Account in accordance with Section 9.01.
SECTION 3.04. CERTAIN DEDUCTIONS AND DISTRIBUTIONS. (a) On or before each
Interest Distribution Date as of the close of business on the preceding Record
Date the Trustee shall separately with respect to each Trust Fund to which such
Interest Distribution Date relates:
(1) deduct from the Interest Account or, to the extent funds are
not available in such Account, from the Principal Account and pay to
itself individually (i) the amounts that it is at the time entitled to
receive pursuant to Section 8.05 on account of its services
theretofore performed and expenses theretofore incurred and (ii) the
amounts that it is at the time entitled to receive under the terms of
Section 3.01 in reimbursement of amounts advanced by it pursuant to
that Section;
(2) deduct from the Interest Account or, to the extent funds are
not available in such Account, from the Principal Account the amounts
that the Evaluator is at the time entitled to receive pursuant to
Section 4.03 on account of its services theretofore performed and
expenses theretofore incurred;
(3) deduct from the Interest Account or, to the extent funds are
not available in such Account, from the Principal Account an amount
equal to unpaid fees and expenses, if any, of bond counsel pursuant to
Section 3.08 as certified by the Depositor;
(4) deduct from the Interest Account, or, to the extent funds are
not available in such Account, from the Principal Account and pay to
the Depositor the amounts that the Depositor is at the time entitled
to receive pursuant to Section 3.13 on account of its services
theretofore performed and expenses theretofore incurred;
(5) deduct from the Interest Account, or, to the extent funds are
not available in such Account, from the Principal Account, and
reimburse itself for any other fees and expenses arising from time to
time out of the Trust operations that the Trustee has paid; and
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(6) deduct from the Interest Account, or, to the extent funds are
not available in such Account, from the Principal Account and pay to
the Insurer the amount of any premium to which it is at the time
entitled to receive, pursuant to Section 2.05.
(b) The Trustee shall for each Trust Fund as of the close of business on
the applicable Record Date compute the amount of the Interest Distribution per
Unit for the next Interest Distribution Date (each such amount being herein
called the "Interest Distribution") (i) by adding to the amount actually
received with respect to interest on the Bonds in the Trust Fund during the
period from the Record Date preceding such Record Date to and including such
Record Date the estimated interest income on the Bonds in the Trust Fund to be
received for the eleven-month period following such Record Date, (ii) by
deducting from the amount determined in accordance with the preceding clause (i)
the total of (X) the sum of the amounts to be deducted from the Interest Account
of such Trust Fund as of such Record Date pursuant to the foregoing provisions
of Section 3.04(a) and (Y) the estimated sum of the amounts to be deducted from
the Interest Account of such Trust Fund pursuant to the foregoing provisions of
Section 3.04(a) during the eleven-month period following such Record Date, (iii)
dividing the amount so obtained by 12 (the number of Interest Distribution Dates
per year for such Unit), and (iv) dividing the result of the calculation
performed pursuant to the immediately preceding clause (iii) by the number of
Units outstanding on the applicable Record Date. On or shortly after each
Interest Distribution Date, the Trustee shall distribute with respect to each
Unitholder of the Trust Fund of record at the close of business on the preceding
Record Date an amount substantially equal to the Interest Distribution computed
as of such Record Date.
To the extent that moneys in the Principal Account have not been
previously used to pay for the redemption of Units tendered to a Trust Fund, on
the Principal Distribution Dates each Unitholder shall receive such holder's pro
rata share of the cash balance of the Principal Account of the Trust Fund
computed as of the close of business on the preceding Record Dates for such
Principal Distribution Dates by (i) deducting from such cash balance the total
of (X) cash required to cover contracts to purchase Bonds, (Y) cash required for
the redemption of unredeemed tendered Units and (Z) the sum of the amounts to be
deducted from the Principal Account as of each such Record Date pursuant to the
foregoing provisions of Section 3.04(a) and (ii) dividing the amount so obtained
by the number of Units outstanding on the Record Date immediately preceding such
Principal Distribution Date; provided, however, that if the balance of the
Principal Account on any such Record Date is less than that amount stated in
Part II of the Trust Agreement, no distribution from the Principal Account need
be made.
In making the computation of any Unitholder's interest in the balance of
the Interest and Principal Accounts, fractions of less than one cent per Unit
shall be omitted. In addition, the Trustee in its discretion may on any
Distribution Date determine that the amount to be distributed to Unitholders
should be more or less than the amount of the applicable Interest or Principal
Distribution per Unit because of any unusual or extraordinary increase or
decrease in the expenses incurred or expected to be incurred by such Trust Fund.
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(c) If the Depositor (i) fails to replace any failed Special Bond (as
defined in Section 3.12) or (ii) is unable or fails to enter into any contract
for the purchase of any New Bond in accordance with Section 3.12, the Trustee
shall distribute to all Unitholders the principal, accrued interest and sales
charge attributable to such Special Bonds not more than 30 days after the
expiration of the Purchase Period (as defined in Section 3.12). If any contract
for a New Bond in replacement of a Special Bond shall fail, the Trustee shall
distribute the principal, accrued interest and sales charge attributable to the
Special Bond to the Unitholders not more than 30 days after the date on which
the contract in respect of such New Bond failed. If at the end of the Purchase
Period less than all moneys attributable to a failed Special Bond have been
applied or allocated by the Trustee pursuant to a contract to purchase New
Bonds, the Trustee shall distribute the remaining moneys (i) to Unitholders not
more than 30 days after the end of the Purchase Period to the extent the failed
Special Bond has not been fully replaced by New Bonds or (ii) to the Depositor
to the extent moneys remain after the purchase of the New Bonds, if any, and the
distribution referred to in clause (i).
(d) Except as provided below, all distributions shall be made by first
class mail to each Unitholder of record at the close of business on the
preceding applicable Record Date at the address of such holder appearing on the
registration books of the Trustee provided, however, that the Trustee shall if
so directed with respect to distributions from the Interest and/or Principal
Account either orally or in writing at the time of purchase of Units or
thereafter in writing signed by the Unitholder and timely received, make such
distributions to a reinvestment program. A Unitholder' s written notice must be
received by the Trustee, as Program Agent for the reinvestment program, at least
ten days prior to the Record Date for the next Interest Distribution in order to
be in effect for such Interest Distribution and by the last Record Date for
distribution of principal in any year in order to be effective for the following
calendar year. All such notices shall remain in effect until a subsequent notice
is received by the Program Agent. Upon receipt of any such distribution the
Program Agent shall purchase shares (or fractions thereof) in the applicable
reinvestment fund as directed by the Unitholder. The Program Agent shall not be
liable to any Unitholder for any action taken with respect to its duties and
responsibilities as Program Agent; PROVIDED, HOWEVER, that this provision shall
not protect the Program Agent against liability to which it would otherwise be
subject by reason of willful misfeasance, bad faith or gross negligence in the
performance of its duties or by reason of its reckless disregard of its
obligations and duties hereunder.
(e) Except as provided by the preceding paragraph, Unitholders of record on
the registration books of the Trustee at the close of business on the Record
Date prior to each Distribution Date, shall be entitled to the distribution in
respect of such Distribution Date, and, except as provided in Article VIII, no
liability shall attach to the Trustee by reason of payment to or on the order of
any such Unitholder of record. Nothing herein shall be construed to prevent the
payment of distributions from the Interest and Principal Accounts to any such
Unitholder by means of one check, draft or other proper instrument.
SECTION 3.05. STATEMENTS AND REPORTS. With each distribution from the
Interest or Principal Accounts of each Trust Fund the Trustee shall set forth,
either in the instrument by
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means of which payment of such distribution is made or in an accompanying
statement, the amount being distributed from each such account expressed as a
dollar amount per Unit of such Trust Fund.; Within a reasonable period of time
after the last business day of each calendar year, the Trustee shall furnish to
each person who at any time during such calendar year was a Unitholder of any
individual Trust Fund a statement for such Trust Fund setting forth with respect
to such calendar year:
(A) as to the Interest Account:
(1) the amount of interest received on the Bonds and, if issuers
of Bonds are located in more than one jurisdiction, the percentage of
such amount by states and territories in which the issuers of the
Bonds are located;
(2) the amounts paid for purchases of New Bonds pursuant to
Section 3.12 and for redemption's pursuant to Section 5.02;
(3) the deductions for applicable taxes and fees and expenses of
the Trustee, the Evaluator, the Depositor and bond counsel, if any,
all as provided under Section 3.04(a);
(4) the reservations made by the Trustee pursuant to Section
3.03, if any;
(5) the balance remaining after such distributions, deductions
and reservations expressed both as a total dollar amount and as a
dollar amount per Unit outstanding on the last business day of such
calendar year;
(B) as to the Principal Account:
(1) the dates of sale, maturity, liquidation or redemption of any
of the Bonds and the net proceeds received therefrom (excluding any
portion thereof credited to the Interest Account);
(2) the amounts paid for purchases of New Bonds pursuant to
Section 3.13 and for redemption's pursuant to Section 5.02;
(3) the deductions for payment of applicable taxes and fees and
expenses (including insurance premiums) of the Trustee, the Evaluator,
the Depositor and bond counsel, if any, all as provided under Section
3.04(a);
(4) the reservations made by the Trustee pursuant to Section
3.03, if any;
(5) the balance remaining after such distributions, deductions
and reservations, expressed both as a total dollar amount and as a
dollar amount per Unit outstanding on the last business day of such
calendar year; and
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(C) the following information:
(1) a list of the Bonds as of the last business day of such
calendar year;
(2) the number of Units outstanding on the last business day of
such calendar year;
(3) the Unit Value based on the Trust Fund Evaluations made on
the last day of December (or the last business day prior thereto) of
such calendar year; and
(4) the amounts actually distributed to Unitholders during such
calendar year from the Interest and Principal Accounts, separately
stated, expressed both as total dollar amounts and as dollar amounts
per Unit outstanding on the Record Dates for such distributions.
SECTION 3.06. EXTRAORDINARY SALE OF BONDS. The Depositor by written notice
may direct the Trustee to sell Bonds at such price and time and in such manner
as shall be deemed appropriate by the Depositor if the Depositor shall have
determined that any one or more of the following conditions exist:
(a) that there has been a default on such Bonds in the payment of
principal or interest when due and payable;
(b) that any action or proceeding has been instituted at law or in
equity seeking to restrain or enjoin the payment of principal or interest
on any such Bonds, the illegality, irregularity or omission of any
necessary acts or proceedings preliminary to the issuance of such Bonds, or
seeking to restrain or enjoin the performance by the officers or employees
of any such issuing body of an improper or illegal act in connection with
the administration of funds necessary for debt service on such Bonds or
otherwise; or that there exists any other legal question or impediment
affecting such Bonds or the payment of principal or interest on the same;
(c) that there has occurred any breach of covenant or warranty in any
resolution, trust indenture or other document which might adversely affect
either immediately or contingently the payment of principal or interest on
such Bonds, or their general credit standing, or otherwise impair the sound
investment character of such Bonds;
(d) that there has been a default in the payment of principal of,
premium, if any, or interest on any other outstanding obligations of the
issuer or the guarantor of such Bonds; or
(e) that in the case of revenue Bonds, the revenues and income of the
facility or project or other special funds expressly charged and pledged
for payment of principal or interest or both on any such Bonds shall fall
substantially below the
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estimated revenues or income calculated by the engineers or other proper
officials charged with the acquisition, construction or operation of such
facility or project, so that, in the opinion of the Depositor, the
retention of such Bonds would be detrimental to the interest of the
Unitholders; or
(f) that the price of any such Bond has declined to such an extent, or
such other market or credit factors exist (including the advance refunding
of any such Bonds), that in the opinion of the Depositor the retention of
such Bonds would be detrimental to the interest of the Unitholders.
Upon receipt of such direction from the Depositor, the Trustee shall
proceed to sell the specified Bonds. The Trustee shall not be liable or
responsible in any way for depreciation or loss incurred by reason of any sale
made pursuant to any such direction or by reason of the failure of the Depositor
to give any such direction, and in the absence of such direction the Trustee
shall have no duty to sell any Bonds under this Section 3.06 except to the
extent otherwise required by Section 3.09. The Depositor shall not be liable for
errors of judgment in directing or failing to direct the Trustee pursuant to
this Section 3.06. This provision, however, shall not protect the Trustee or
Depositor against any liability for which they would otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence in the performance
of their duties or by reason of their reckless disregard of their obligations
and duties hereunder.
SECTION 3.07. REFUNDING OBLIGATIONS. In the event that an offer by the
issuer of any of the Bonds shall be made to issue new obligations in exchange or
substitution for any issue of Bonds pursuant to a plan for the refunding or
refinancing of such Bonds, the Depositor shall instruct the Trustee in writing
to reject such offer and either hold or sell such Bonds, except that if (1) the
issuer is in default with respect to payment of principal or interest or both on
such Bonds or (2) in the opinion of the Depositor given in writing to the
Trustee, the issuer will probably default with respect to payment of principal
or interest or both on such Bonds in the reasonably foreseeable future, the
Depositor shall instruct the Trustee in writing to accept or reject such offer
or take any other action with respect thereto as the Depositor may deem proper.
Any obligations received in exchange shall be deposited hereunder and shall be
subject to the terms and conditions of this Agreement to the same extent as the
Bonds originally deposited hereunder. Within five days after such exchange and
deposit, written notice thereof shall be given by the Trustee, as agent for the
Depositor, to each Unitholder of the affected Trust Fund, including an
identification of the Bonds eliminated and the obligations substituted therefor.
SECTION 3.08. COUNSEL. The Depositor may employ from time to time counsel
to act on behalf of any Trust Fund for any legal services in connection with the
Bonds, and any legal matters relating to the possible disposition of any Bonds
pursuant to any provisions hereof. The fees and expenses of such counsel shall
be paid by the Trustee as provided in Section 3.04(a)(3) hereof.
SECTION 3.09. ACTION BY TRUSTEE REGARDING BONDS. (a) In the event that the
Trustee shall have been notified at any time of any action to be taken or
proposed to be taken by
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holders of the Bonds (including but not limited to the making of any demand,
direction, request, giving of any notice, consent or waiver or the voting with
respect to any amendment or supplement to any indenture, agreement or other
instrument under or pursuant to which the Bonds have been issued) the Trustee
shall promptly notify the Depositor and shall thereupon take such action or
refrain from taking any action as the Depositor shall in writing direct;
provided, however, that if the Depositor shall not within five business days of
the giving of such notice to the Depositor direct the Trustee to take or refrain
from taking any action, the Trustee shall take such action as it, in its sole
discretion, shall deem advisable. The Bonds may, in the discretion of the
Trustee, be interchanged from time to time into either bearer or registered form
without any notification thereof to the Depositor or the Unitholders and may be
registered in the name of the Trustee or the name of any nominee designated by
it.
(b) If at any time the principal of or interest on any of the Bonds shall
not have been duly paid, either pursuant to the Insurance or otherwise, the
Trustee shall notify the Depositor thereof. If within thirty days after such
notification the Depositor has not given any instruction in writing to sell or
to hold or has not taken any action in connection with such Bonds, the Trustee
may, in its discretion, sell such Bonds forthwith, and the Trustee shall not be
liable or responsible in any way for depreciation or loss incurred by reason of
such sale.
(c) Except as provided in Article VII and Article VIII, neither the
Depositor nor the Trustee shall be liable to any person for any action or
failure to take action with respect to this Section 3.09.
SECTION 3.10. TRUSTEE NOT REQUIRED TO ADJUST ACCOUNTS. Nothing in this
Agreement, or otherwise, shall be construed to require the Trustee to make any
adjustments between the Interest Account and the Principal Account by reason of
any premium or discount in respect of any of the Bonds.
SECTION 3.11. NOTICE OF CHANGE IN PRINCIPAL ACCOUNT. The Trustee shall give
prompt written notice to the Depositor and the Evaluator (if separate from the
Depositor) of all amounts credited to or withdrawn from the Principal Account of
any Trust Fund pursuant to any of the provisions of this Article III, and the
balance in such Account after giving effect to the credit or withdrawal.
SECTION 3.12. LIMITED REPLACEMENT OF SPECIAL BONDS. If any contract in
respect of Contract Obligations other than a contract to purchase a New Bond (as
defined below), including those purchased on a "when, as and if issued" basis,
shall have failed due to any occurrence, act or event beyond the control of the
Depositor or the Trustee (such failed Contract Obligations being herein called
the "Special Bonds"), the Depositor, after it is notified in writing that the
Special Bond will not be delivered by the seller thereof to the Depositor, shall
notify the Trustee (such notice being herein called the "Failed Contract
Notice") of its inability to deliver the failed Special Bond to the Trustee.
Within a maximum of 20 days after giving such Failed Contract Notice (such 20
day period being herein called the "Purchase Period"), the Depositor may, if it
deems such action to be in the best interest
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of the Trust, purchase, or enter into a contract to purchase, an obligation to
be held as a Bond hereunder (herein called the "New Bond") as part of the Trust
Fund in replacement of the failed Special Bond, subject to the satisfaction of
all of the following conditions in the case of each purchase or contract to
purchase:
(a) The New Bonds (i) shall be tax-exempt bonds issued by states or
territories of the United States or political subdivisions and authorities
thereof, (ii) shall have a fixed maturity date (whether or not entitled to
the benefits of any sinking, redemption, purchase or similar fund) not less
than the earlier of the maturity of the Special Bond or ten years after the
date of purchase, (iii) must be purchased at a price that results in a
yield to maturity and a current return at least equal to that of the
Special Bonds as of the Initial Date of Deposit, (iv) shall be payable as
to principal and interest in United States currency, (v) shall not be
"when, as if issued" bonds and (vi) must be eligible to be insured (and
when acquired be insured) under the Insurance, if applicable.
(b) Each New Bond shall be rated at least "A" or better by Standard &
Poor's Ratings Group, a division of XxXxxx-Xxxx, Inc. or Xxxxx'x Investors
Service, Inc.
(c) The purchase price of the New Bonds shall not exceed the amount of
funds reserved for the purchase of the Special Bonds.
(d) The Depositor shall furnish a notice to the Trustee (which may be
part of the Failed Contract Notice) in respect of the New Bond purchased or
to be purchased that shall (i) identify the New Bonds, (ii) state that the
contract to purchase, if any, entered into by the Depositor is satisfactory
in form and substance and (iii) state that the foregoing conditions of
clauses (a) and (b) have been satisfied with respect to the New Bonds.
Upon satisfaction of the foregoing conditions with respect to any New Bond,
the Trustee shall pay the purchase price for the New Bond from the amount of
funds reserved for the purchase of the Special Bonds or, if the Trustee has
credited any moneys and/or letters of credit attributable to the failed Special
Bond to the Principal Account, the Trustee shall pay the purchase price of the
New Bond upon directions from the Depositor from the moneys and/or letters of
credit so credited to the Principal Account. If the Trustee has credited moneys
of the Depositor to the Principal Account, the Trustee shall forthwith return to
the Depositor the portion of such moneys that is not properly distributable to
Unitholders pursuant to Section 3.04.
Whenever a New Bond is acquired by the Depositor pursuant to the provisions
of this Section 3.12, the Trustee shall, within five days thereafter, mail to
all Unitholders notices of such acquisition, including an identification of the
failed Special Bonds and the New Bonds acquired. The purchase price of the New
Bonds shall be paid out of the funds reserved for the purchase of the failed
Special Bonds. Except as provided in Article VIII, the Trustee shall not be
liable or responsible in any way for depreciation or loss incurred by reason of
any purchase made pursuant to any such directions and in the absence of such
directions the
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Trustee shall have no duty to purchase any New Bonds under this Agreement. The
Depositor shall not be liable for any failure to instruct the Trustee to
purchase any New Bonds or for errors of judgment in respect of this Section
3.12; provided, however, that this provision shall not protect the Depositor
against any liability to which it would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the performance of its
duties or by reason of its reckless disregard of its obligations and duties
hereunder.
SECTION 3.13. COMPENSATION OF DEPOSITOR FOR SUPERVISORY SERVICES. As
compensation for providing supervisory portfolio services under this Agreement,
the Depositor shall receive against a statement or statements therefor submitted
to the Trustee monthly or annually an aggregate annual fee in the amount
specified as compensation for the Depositor in Part II of the Trust Agreement,
but in no event shall such compensation when combined with all compensation
received from other series of the Fund or other unit investment trusts sponsored
by the Depositor or its affiliates for providing such supervisory services in
any calendar year exceed the aggregate cost to the Depositor for providing such
services. The rate of such compensation may be increased by the Depositor from
time to time, without the consent or approval of any Unitholder or the Trustee,
by amounts not exceeding the proportionate increase, during the period from the
date of such Trust Agreement to the date of any such increase, in consumer
prices as last published prior to each such date under the classification "All
Services Less Rent of Shelter" in the Consumer Price Index For All Urban
Consumers (CPI-U) U.S. City Average, not seasonally adjusted, base 1982 - 84 =
100, published by the United States Department of Labor. In the event that such
classification ceases to incorporate a significant number of items, or if a
substantial change is made in the method of establishing such classification,
then the classification shall be adjusted in a fair and reasonable manner to the
figure that would have resulted had no substantial change occurred in the manner
of computing such classification. In the event that such classification (or a
successor or substitute index) is not available, such governmental or other
service or publication as shall evaluate the information in substantially the
same manner as the aforesaid classification shall be used in lieu thereof. Such
compensation shall be charged by the Trustee, upon receipt of invoice therefor
from the Depositor, against the Interest and Principal Accounts on or before the
Distribution Date on which such period terminates. If the cash balance in the
Interest and Principal Accounts shall be insufficient to provide for amounts
payable pursuant to this Section 3.13, the Trustee shall have the power to sell
(i) Bonds from the current list of Bonds designated to be sold pursuant to
Section 5.02 hereof, or (ii) if no such Bonds have been so designated, such
Bonds as the Trustee may see fit to sell in its own discretion, and to apply the
proceeds of any such sale in payment of the amounts payable pursuant to this
Section 3.13. Any moneys payable to the Depositor pursuant to this Section 3.13
shall be secured by a prior lien on the Trust Fund except that such lien shall
be junior and subordinate to any lien in favor of the Trustee under the
provisions of Section 8.08.
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ARTICLE IV
EVALUATION OF BONDS;
THE EVALUATOR
SECTION 4.01. EVALUATION OF BONDS. The Evaluator shall determine separately
and promptly furnish to the Trustee and the Depositor (if separate from the
Evaluator) upon request the value of each issue of Bonds (treating separate
maturities of Bonds as separate issues) as of the Evaluation Time on the bid
side of the market on the days on which the Trust Fund Evaluation is required by
Section 5.01, and, in addition, as of the Evaluation Time on the bid side of the
market if the secondary market in the Units is maintained based on bid side
values or on both the bid and offering sides, if the Trustee shall so inform the
Evaluator from time to time, such additional evaluation being on each business
day commencing with the date of the Trust Agreement. Such evaluations shall be
made (i) on the basis of current bid or offering prices for the Bonds, (ii) if
bid or offering prices are not available for any Bonds, on the basis of current
bid or offering prices for comparable bonds, (iii) by determining the value of
the Bonds on the bid or offering side of the market by appraisal or (iv) by any
Fund, the Evaluator shall also determine and furnish to the Trustee and the
Depositor the aggregate of (a) the value of all Bonds on the basis of such
evaluation and (b) on the basis of the information furnished to the Evaluator by
the Trustee pursuant to Section 3.11, the amount of cash then held in the
Principal Account which was received by the Trustee after the Record Date
preceding such determination less any amounts held in the Principal Account for
distribution to Unitholders on a subsequent Distribution Date when a Record Date
occurs four business days or less after such determination. For the purposes of
the foregoing, the Evaluator may obtain current bid or offering prices for the
Bonds from investment dealers or brokers (including the Depositor) that
customarily deal in similar bonds or from any other reporting service or sources
of information which the Evaluator deems appropriate.
Insurance obtained for a Trust Fund has no effect, under normal
circumstances, on the price or redemption value of Units. It is the present
intention of the Evaluator to attribute a value to such insurance for the
purpose of computing the price or redemption value of Units only in
circumstances where the credit quality of an underlying Bond has significantly
deteriorated. The value to be added to such Bonds shall be an amount equal to
the excess, if any, by which the net proceeds realizable from the sale of the
Bonds on an insured basis exceeds the sum of (i) the net proceeds realizable
from the sale of the Bonds on an uninsured basis plus (ii) the premium
attributable to the Permanent Insurance. The Depositor will instruct the Trustee
not to sell such Bonds to effect redemptions or for any other reason but rather
to retain them in the portfolio unless value attributable to the Permanent
Insurance can be realized upon sale. Insurance obtained by the issuer of a Bond
is effective so long as such Bond is outstanding. Therefore, any such insurance
may be considered to represent an element of market value in regard to the Bonds
thus insured, but the exact effect, if any, of this insurance on such market
value cannot be predicted.
SECTION 4.02. CERTAIN INFORMATION TO BE MADE AVAILABLE. For the purpose of
permitting Unitholders to satisfy any reporting requirements of applicable
federal or state
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tax law, the Evaluator shall make available to the Trustee and the Trustee shall
transmit to any Unitholder upon request any determinations made by the Evaluator
pursuant to Section 4.01 which concern the Trust Fund in which such Unitholder
holds Units.
SECTION 4.03. COMPENSATION OF THE EVALUATOR. As compensation for its
services hereunder, the Evaluator shall receive against a statement therefor
submitted to the Trustee on or before each Distribution Date the amount
specified as compensation for the Evaluator in Part II of the Trust Agreement.
The rate of such compensation may be increased by the Evaluator from time to
time, without the consent or approval of any Unitholder, the Trustee or the
Depositor, by amounts not exceeding the proportionate increase, during the
period from the date of such Trust Agreement to the date of any such increase,
in consumer prices as last published prior to each such date under the
classification "All Services Less Rent of Shelter" in the Consumer Price Index
For All Urban Consumers (CPI-U) U.S. City Average, not seasonally adjusted, base
1982 - 84 = 100, published by the United States Department of Labor. In the
event that such classification ceases to incorporate a significant number of
items, or if a substantial change is made in the method of establishing such
classification, then the classification shall be adjusted in a fair and
reasonable manner to the figure that would have resulted had no substantial
change occurred in the manner of computing such classification. In the event
that such classification (or a successor or substitute index) is not available,
such governmental or other service or publication as shall evaluate the
information in substantially the same manner as the aforesaid classification
shall be used in lieu thereof. Such compensation shall be charged by the
Trustee, upon receipt of invoice therefor from the Evaluator, against the
Interest and Principal Accounts on or before the Distribution Date. If the cash
balances in the Interest and Principal Accounts shall be insufficient to provide
for amounts payable pursuant to this Section 4.03, the Trustee shall have the
power to sell (i) Bonds designated to be sold pursuant to Section 5.02 hereof or
(ii) if no such Bonds have been so designated, such Securities as the Trustee
may see fit to sell in its own discretion, and to apply the proceeds of any such
sale in payment of the amounts payable pursuant to this Section 4.03. Any moneys
payable to the Evaluator pursuant to this Section 4.03 shall be secured by a
prior lien on the Trust Fund except that such lien shall be junior and
subordinate to any lien in favor of the Trustee under the provisions of Section
8.08.
SECTION 4.04. LIABILITY OF THE EVALUATOR. The Trustee, the Depositor (if
separate from the Evaluator) and the Unitholders may rely on any evaluation
furnished by the Evaluator and shall have no responsibility for the accuracy
thereof. The determinations made by the Evaluator hereunder shall be made in
good faith upon the basis of the best information available to it. The Evaluator
shall be under no liability to the Trustee, the Depositor or the Unitholders for
errors in judgment; provided, however, that this provision shall not protect the
Evaluator against any liability to which it would otherwise be subject by reason
of willful misfeasance, bad faith or gross negligence in the performance of its
duties or by reason of its reckless disregard of its obligations and duties
hereunder.
SECTION 4.05. RESIGNATION, REMOVAL AND OTHER MATTERS RELATING TO THE
EVALUATOR. (a) The Evaluator may resign and be discharged hereunder, by
executing an instrument in writing resigning as the Evaluator and filing the
same with the Depositor (if separate from
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the Evaluator) and the Trustee not less than 60 days before the date specified
in such instrument when, subject to Section 4.05(c), such resignation is to take
effect. Upon receiving such notice of resignation, the Depositor (if separate
from the Evaluator) and the Trustee shall use their best efforts to appoint a
successor Evaluator having qualifications and at a rate of compensation
satisfactory to the Depositor (if separate from the Evaluator) and the Trustee.
Such appointment shall be made by written instrument executed by the Depositor
(if separate from the Evaluator) and the Trustee, in duplicate, one copy of
which shall be delivered to the resigning Evaluator and one copy to the
successor Evaluator. The Depositor may remove the Evaluator at any time upon
thirty days' written notice and appoint a successor Evaluator having
qualifications and at a rate of compensation satisfactory to the Depositor and
the Trustee. Such appointment shall be made by written instrument executed by
the Depositor, in duplicate, one copy of which shall be delivered to the
Evaluator so removed and one copy to the successor Evaluator. Notice of such
resignation or removal and appointment of a successor Evaluator shall be mailed
by the Trustee to each Unitholder.
(b) If the Evaluator resigns and no successor Evaluator shall have been
appointed and have accepted appointment within 30 days after receipt of the
notice of resignation by the Depositor (if appropriate) and the Trustee, the
Evaluator may forthwith apply to a court of competent jurisdiction for the
appointment of a successor Evaluator. Such court may thereupon, after such
notice, if any, as it may deem proper, appoint a successor Evaluator.
(c) Any successor Evaluator appointed hereunder shall execute, acknowledge
and deliver to the Depositor and the Trustee an instrument accepting such
appointment hereunder, and such successor Evaluator without any further act,
deed or conveyance shall become vested with all the rights, powers, duties and
obligations of its predecessor hereunder with like effect as if originally named
the Evaluator herein and shall be bound by all the terms and conditions of this
Agreement. Any resignation or removal of the Evaluator and appointment of a
successor Evaluator pursuant to this Section 4.05 shall become effective upon
such acceptance of appointment.
(d) Any corporation into which the Evaluator hereunder may be merged or
with which it may be consolidated, or any corporation resulting from any merger
or consolidation to which the Evaluator hereunder shall be a party, shall be the
successor Evaluator under this Agreement without the execution or filing of any
paper, instrument or further act to be done on the part of the parties hereto,
anything herein, or in any agreement relating to such merger or consolidation,
by which the Evaluator may seek to retain certain powers, rights and privileges
theretofore obtaining for any period of time following such merger or
consolidation, to the contrary notwithstanding.
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ARTICLE V
TRUST FUND EVALUATION;
REDEMPTION OF UNITS
SECTION 5.01. TRUST FUND EVALUATION. As of the Evaluation Time next
following any tender by a Unitholder for redemption and on any other business
day desired by it or as may be required hereunder, the Trustee shall as to each
Trust Fund:
Add
(1) cash on hand in the Trust Fund, other than cash held especially
for the purchase of Contract Obligations,
(2) the aggregate value of each issue of the Bonds in the Trust Fund
(including Contract Obligations) on the bid side of the market as
determined by the Evaluator pursuant to Section 4.01, and
(3) accrued but unpaid interest on the Bonds in the Trust Fund at the
close of business on the date of such computation;
Deduct
(1) amounts representing any applicable taxes, governmental charges or
other charges pursuant to Section 3.03 payable out of the Trust Fund and
for which no deductions shall have previously been made for the purpose of
addition to the Reserve Account,
(2) amounts representing estimated accrued fees and expenses of the
Trust Fund including but not limited to unpaid fees and expenses of the
Trustee (including legal and auditing expenses), the Evaluator, the
Depositor, the Insurer and bond counsel, and
(3) cash allocated for distribution to Unitholders of the Trust Fund
of record as of the business day prior to the evaluation then being made.
The resulting figure is herein called a "TRUST FUND EVALUATION."
SECTION 5.02. REDEMPTION OF UNITS; SALE OF BONDS. Any Unitholder may cause
any of his Units to be redeemed by the Trustee, subject to the terms of this
Section 5.02, by making a written request to the Trustee at its principal trust
office, and, in the case of Units evidenced by a Certificate, by tendering such
Certificate to the Trustee at such office, properly endorsed or accompanied by a
written instrument or instruments of transfer in form satisfactory to the
Trustee. Unitholders must sign such written request, and such Certificate or
transfer instrument, exactly as their name appears on the records of the Trustee
and on any Certificate representing the Units to be redeemed. Such signature
must
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be guaranteed by a participant in the Securities Transfer Agents Medallion
Program ("STAMP") or such other signature guarantee program in addition to, or
in substitution for, STAMP, as may be accepted by the Trustee. Such redemption
shall be made by the Trustee on the seventh calendar day following the day on
which request for redemption is received by the Trustee, provided that if such
seventh calendar day is not a business day, then such Units shall be redeemed on
the first business day prior thereto (such seventh calendar day or first
business day prior thereto being herein called the "REDEMPTION DATE"). Subject
to payment by such Unitholder of any tax or other governmental charges which may
be imposed thereon, such redemption is to be made by payment on the Redemption
Date of cash equal to the Unit Value (determined on the basis of the Trust Fund
Evaluation made in accordance with Section 5.0l) multiplied by the number of
Units being redeemed (herein called the "REDEMPTION PRICE"). The portion of the
Redemption Price which represents interest shall be withdrawn from the Interest
Account of the affected Trust Fund to the extent available. The balance paid on
any redemption including accrued interest, if any, shall be withdrawn from the
Principal Account of the affected Trust to the extent that funds are available
for such purpose. If such available balance shall be insufficient, the Trustee
shall sell from such Trust Fund such Bonds from among those designated for such
purpose by the Depositor as the Trustee in its discretion shall deem advisable
or necessary. Sales of Bonds by the Trustee shall be made in such manner as the
Trustee shall in the exercise of its fiduciary judgment determine will bring the
best price obtainable for the Trust Fund. In the event that funds are withdrawn
from the Principal Account or Bonds are sold for payment of any portion of the
Redemption Price representing accrued interest, the Principal Account shall be
reimbursed when sufficient funds are next available in the Interest Account for
such funds so applied.
The Trustee may in its discretion, and shall when so directed by the
Depositor in writing, suspend the right of redemption or postpone the date of
payment of the Redemption Price for more than seven calendar days following the
day on which tender for redemption is made (1) for any period during which the
New York Stock Exchange, Inc. is closed other than customary weekend and holiday
closings; (2) for any period during which (i) trading on the New York Stock
Exchange, Inc. is restricted or (ii) an emergency exists as a result of which
disposal by the Trust Fund of the Bonds is not reasonably practicable or it is
not reasonably practicable fairly to determine in accordance herewith the value
of the Bonds for the purposes of any Trust Fund Evaluation; or (3) for such
other period as the Securities and Exchange Commission may by order permit.
No later than the close of business on the day of tender of any Unit for
redemption by a Unitholder other than the Depositor, the Trustee shall notify
the Depositor of such tender. The Depositor shall have the right to purchase
such Units by notifying the Trustee of its election to make such purchase as
soon as practicable thereafter but in no event subsequent to the close of
business on the second business day after the day on which such Units were
tendered for redemption. Such purchase shall be made by payment for such Units
by the Depositor to the Unitholder not later than the close of business on the
Redemption Date of any amount not less than the Redemption Price which would
otherwise be payable by the Trustee to such Unitholder.
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Any Unit so purchased by the Depositor may at the option of the Depositor
be tendered to the Trustee for redemption in the manner provided in the first
paragraph of this Section 5.02.
The Depositor shall deliver a current list of Bonds in each Trust Fund to
be sold for the purpose of redemption of Units tendered for redemption and for
payment of expenses hereunder. In connection therewith, the Depositor may
specify the minimum principal amounts of any Bonds to be sold at any one time.
If at any such time the Depositor shall for any reason fail to deliver such a
list, the Trustee, in its sole discretion, may designate a current list of Bonds
in each Trust Fund for such purposes. The net proceeds of any sale of Bonds
which represents interest shall be credited to the Interest Account of the
affected Trust Fund, and the balance of such net proceeds shall be credited to
the Principal Account of such Trust Fund. The Depositor shall also designate on
such list of Bonds designated to be sold the Bonds upon the sale of which the
Trustee shall obtain permanent insurance (the "PERMANENT INSURANCE") from an
Insurer, provided that if the Depositor shall for any reason fail to make such
designation, the Trustee in its sole discretion shall make such designation if
it deems such designation to be in the best interests of Unitholders. The
Trustee is hereby authorized to pay and shall pay out of the proceeds of the
sale of the Bonds which are covered by Permanent Insurance any premium for such
Permanent Insurance and the net proceeds after such deduction shall be credited
to the Principal Account and the net proceeds representing accrued interest
shall be credited to the Interest Account.
Except as provided in Article VII and Article VIII, neither the Depositor
nor the Trustee shall be liable or responsible in any way for depreciation or
loss incurred by reason of any sale or designation of Bonds made pursuant to
this Section 5.02.
Any Certificates evidencing Units redeemed pursuant to this Section 5.02
shall be cancelled by the Trustee and the Unit or Units evidenced by such
Certificates shall be extinguished by such redemptions.
ARTICLE VI
ISSUANCE, TRANSFER, INTERCHANGE
AND REPLACEMENT OF CERTIFICATES
SECTION 6.01. ISSUANCE OF CERTIFICATES. Certificates representing Units
held by a Unitholder will not be issued except upon written request by a
Unitholder, or his or her registered broker/dealer, to the Trustee at its
principal trust office. Certificates that have been issued may be returned to
the Trustee at any time and cancelled, without affecting the Unitholder's
interest in the Trust Fund, when accompanied by proper written instructions from
the Unitholder.
SECTION 6.02. TRANSFER OF UNITS Interchange of Certificates;. A Unitholder
may transfer any of his Units by making a written request to the Trustee at its
principal trust office and, in the case of Units evidenced by a Certificate, by
presenting and surrendering
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such Certificate at such office properly endorsed or accompanied by a written
instrument or instruments of transfer in form satisfactory to the Trustee.
Unitholders must sign such written request, and such Certificate of transfer
instrument, exactly as their name appears on the records of the Trustee and on
any Certificate representing the Units to be transferred. Such signature must be
guaranteed by a participant in the Securities Transfer Agents Medallion Program
("STAMP") or such other signature guarantee program in addition to, or in
substitution for, STAMP, as may be accepted by the Trustee. Such transfer shall
thereupon be made on the records of the Trustee and, if appropriate, a new
registered Certificate or Certificates for the same number of Units of the same
Trust Fund shall be issued in exchange and substitution therefor. Certificates
issued pursuant to this Agreement are interchangeable for one or more other
Certificates of the same Trust Fund in an equal aggregate number of Units and
all Certificates issued shall be issued in denominations of one Unit or any
whole multiple thereof as may be requested by the Unitholder. The Trustee may
deem and treat the person in whose name any Unit or Certificate shall be
registered upon the books of the Trustee as the owner of such Unit or
Certificate for all purposes hereunder and the Trustee shall not be affected by
any notice to the contrary. The transfer books maintained by the Trustee for
each Trust Fund for the purpose of this Section 6.02 shall be closed for an
individual Trust Fund as such Trust Fund is terminated pursuant to Article IX
hereof.
A sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any such transfer or interchange shall be paid to the
Trustee. A Unitholder may be required to pay such amount as may be specified by
the Trustee (and approved by the Depositor) for each new Certificate issued on
any such transfer or interchange.
All Certificates cancelled pursuant to this Agreement, other than those
endorsed for transfer, may be cremated or otherwise destroyed by the Trustee.
SECTION 6.03. REPLACEMENT OF CERTIFICATES. In case any Certificate shall
become mutilated or be destroyed, stolen or lost, the Trustee shall execute and
deliver a new Certificate in exchange and substitution therefor upon the
Unitholder's furnishing the Trustee with proper identification and satisfactory
indemnity, complying with such other reasonable regulations and conditions as
the Trustee may prescribe and paying such expenses as the Trustee may incur,
provided, however, that if the particular Trust Fund has terminated or is in the
process of termination, the Trustee, in lieu of issuing such new Certificate,
may, upon the terms and conditions set forth herein, make the distributions set
forth in Section 9.01 hereof. Any mutilated Certificate shall be duly
surrendered and cancelled before any duplicate Certificate shall be issued in
exchange and substitution therefor. Any duplicate Certificate issued pursuant to
this Section 6.03 shall constitute complete and indefeasible evidence of
ownership in the Trust Fund, as if originally issued, whether or not the lost,
stolen or destroyed Certificate shall be found at any time. Upon issuance of any
duplicate Certificate pursuant to this Section 6.03, the Certificate claimed to
have been lost, stolen or destroyed shall become null and void and of no effect,
and any bona fide purchaser thereof shall have only such rights as are afforded
under Article 8 of the
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Uniform Commercial Code to a holder presenting a Certificate for transfer in the
case of an overissue.
SECTION 6.04. FORM OF CERTIFICATE. Each Certificate shall be in fully
registered form, shall be numbered serially for identification, shall be
executed in facsimile by the original Depositor of the Trust Fund in question
and manually by an authorized signatory of the Trustee, shall be dated the date
of execution and delivery by the Trustee and shall represent a fractional
undivided interest in the specified Trust Fund, the numerator of which fraction
shall be the number of Units set forth on the face of such Certificate and the
denominator of which shall be the total number of Units of undivided interest of
such Trust Fund outstanding at any such time.
ARTICLE VII
DEPOSITOR
Section 7.01. CERTAIN MATTERS REGARDING SUCCESSION. The covenants,
provisions and agreements herein contained shall in every case be binding upon
any successor to the business of any Depositor. In the event of an assignment by
any Depositor to a successor corporation or partnership as permitted by the next
following sentence, such Depositor and, if such Depositor is a partnership, its
partners shall be relieved of all further liability under this Agreement. Any
Depositor may transfer all or substantially all of its assets to a corporation
or partnership which carries on the business of such Depositor, if at the time
of such transfer such successor duly assumes all the obligations of such
Depositor under this Agreement.
SECTION 7.02. LIABILITY OF DEPOSITOR AND INDEMNIFICATION. (a) The Depositor
shall not be under any liability to any Trust Fund or the Unitholders for any
action taken or for refraining from the taking of any action in good faith
pursuant to this Agreement, or for errors in judgment or for depreciation or
loss incurred by reason of the purchase or sale of any Bonds, provided, however,
that this provision shall not protect the Depositor against any liability to
which it would otherwise be subject by reason of willful misfeasance, bad faith
or gross negligence in the performance of its duties or by reason of its
reckless disregard of its obligations and duties hereunder. The Depositor may
rely in good faith on any paper, order, notice, list, affidavit, receipt,
evaluation, opinion, endorsement, assignment, draft or any other document of any
kind prima facie properly executed and submitted to it by the Trustee, the
Trustee's counsel, the Evaluator or any other person for any matters arising
hereunder. The Depositor shall in no event be deemed to have assumed or incurred
any liability, duty or obligation to any Unitholder, the Evaluator or the
Trustee other than as expressly provided for herein.
(b) Each Trust Fund shall pay and hold the Depositor harmless from and
against any loss, liability or expense incurred in acting as Depositor of such
Trust Fund other than by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties or by reason of its reckless
disregard of its obligations and duties hereunder. The
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Depositor shall not be under any obligation to appear in, prosecute or defend
any legal action which in its opinion may involve it in any expense or
liability, provided, however, that the Depositor may in its discretion undertake
any such action which it may deem necessary or desirable in respect of this
Agreement and the rights and duties of the parties hereto and the interests of
the Unitholders hereunder and, in such event, the legal expenses and costs of
any such action and any liability resulting therefrom shall be expenses, costs
and liabilities of the Trust Fund concerned and shall be paid directly by the
Trustee out of the Interest and Principal Accounts of such Trust Fund.
(c) None of the provisions of this Agreement shall be deemed to protect or
purport to protect the Depositor against any liability to the Trust Fund or to
the Unitholders to which the Depositor would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the performance of its
duties, or by reason of the Depositor's reckless disregard of its obligations
and duties under this Agreement.
ARTICLE VIII
TRUSTEE
SECTION 8.01. GENERAL MATTERS RELATING TO THE TRUSTEE. (a) All moneys
deposited with or received by the Trustee hereunder shall be held by it without
interest in trust as part of the appropriate Trust Fund or Reserve Account until
required to be disbursed in accordance with the provisions of this Agreement and
such moneys will be segregated in such manner as shall constitute the
segregation and holding thereof in trust within the meaning of the Investment
Company Act of 1940.
(b) The Trustee shall be under no liability for any action taken in good
faith on any evaluation, paper, order, list, demand, request, consent,
affidavit, notice, opinion, direction, endorsement, assignment, resolution,
draft or other document whether or not of the same kind, prima facie properly
executed, or the disposition of moneys or Bonds pursuant to this Agreement;
provided, however, that this provision shall not protect the Trustee against any
liability to which it would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of its duties or
by reason of its reckless disregard of its obligations and duties hereunder, and
the Trustee may construe any of the provisions of this Agreement insofar as the
same may appear to be ambiguous or inconsistent with any other provisions
hereof, and any construction of any such provisions hereof by the Trustee in
good faith shall be binding upon the parties hereto and the Unitholders.
(c) The Trustee shall not be responsible for or in respect of the recitals
herein, the validity or sufficiency of this Agreement or for the due execution
hereof by the Depositor, or for the form, character, genuineness, sufficiency,
value or validity of any Bonds (except that the Trustee shall be responsible for
the exercise of due care in determining the genuineness of Bonds delivered to it
pursuant to contracts for the purchase of such Bonds) or for or in respect of
the validity or sufficiency of any Certificates (except for the due execution
thereof by the Trustee) or for the due execution thereof by the Depositor and
the
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Trustee shall in no event assume or incur any liability, duty or obligation to
any Unitholder or to the Depositor or Evaluator, other than as expressly
provided for herein. The Trustee shall not be responsible for or in respect of
the validity of any signature by or on behalf of the Depositor.
(d) The Trustee shall not be under any obligation to appear in, prosecute
or defend any action which in its opinion may involve it in expense or liability
unless it shall be furnished with such reasonable security and indemnity against
such expense or liability as it may be required, and any pecuniary cost of the
Trustee from such actions shall be deductible ratably from and a ratable charge
against the Trust Funds concerned. The Trustee shall in its discretion undertake
such action as it may deem necessary at any and all times to protect the Trust
Funds and the rights and interests of the Unitholders pursuant to the terms of
this Agreement, provided, however, that the expenses and costs of such actions,
undertakings or proceedings shall be reimbursable to the Trustee ratably from
the Trust Funds concerned.
(e) The Trustee may employ agents, attorneys, accountants and auditors,
including an agent or agents for the purpose of custody and safeguarding Bonds,
and shall not be answerable for the default or misconduct of any such agents,
attorneys, accountants or auditors if such agents, attorneys, accountants or
auditors shall have been selected with reasonable care. The Trustee shall not be
liable in respect of any action taken or suffered under this Agreement in good
faith, in accordance with an opinion of counsel. The fees and expenses charged
by such agents, attorneys, accountants or auditors, except for the fees and
expenses charged by any agent or agents for custody and safeguarding of Bonds,
shall constitute an expense of the Trustee reimbursable from the Interest and
Principal Accounts as set forth in Section 3.04 hereof.
(f) If at any time the Depositor shall fail to undertake or perform any of
the duties which by the terms of this Agreement are affirmatively required by it
to be undertaken or performed, or the Depositor shall be incapable of acting, or
shall be adjudged a bankrupt or insolvent, or a receiver of the Depositor or of
its property shall be appointed, or any public officer shall take charge or
control of the Depositor or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, then in any such case, the Trustee
may do any one or more of the following: (1) appoint a successor Depositor who
shall act hereunder in all respects in place of such Depositor and which may be
compensated, at rates deemed by the Trustee to be reasonable under the
circumstances, by deduction ratably from the Interest Account or, to the extent
funds are not available in such Account, from the Principal Account of the Trust
Funds but no such deduction shall be made exceeding such reasonable amount as
the Securities and Exchange Commission may prescribe in accordance with Section
26(a)(2)(C) of the Investment Company Act of 1940; (2) continue to act as
Trustee hereunder without terminating this Agreement; or (3) terminate this
Agreement and the trust created hereby and liquidate the Trust Funds in the
manner provided in Section 9.0l.
(g) If the value of any Trust Fund as shown by any Trust Fund Evaluation
shall be less than the liquidation amount specified in Part II of the Trust
Agreement the Trustee may in its discretion, and shall if so directed by the
Depositor, terminate this Agreement and the
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trust created hereby, only insofar as it relates to such Trust Fund, and
liquidate such Trust Fund all in the manner provided in Section 9.0l or if by
reason of the aggregate redemption of Units not theretofore sold by the
Depositor and/or one or more of the underwriters such that the net worth of such
Trust Fund is reduced to less than 40% of the aggregate principal amount of
Bonds initially deposited therein, the Trustee shall terminate this Agreement
and the trust created hereby, only insofar as it relates to such Trust Fund, and
liquidate such Trust Fund, all in the manner provided in Section 9.0l.
(h) In no event shall the Trustee be personally liable for any taxes or
other governmental charges imposed upon or in respect of the Bonds or upon the
interest thereon. The Trustee shall be reimbursed and indemnified out of the
Interest and Principal Accounts of the appropriate Trust Fund for all such taxes
and charges, for any tax or charge imposed against the Trustee as Trustee of
such Trust Fund and for any expenses, including counsel fees, which the Trustee
may sustain or incur with respect to such taxes or charges.
(i) Notwithstanding any provisions of this Agreement to the contrary, no
payment to a Depositor or to any principal underwriter (as defined in the
Investment Company Act of 1940) for the Trust Fund or to any affiliated person
(as so defined) or agent of a Depositor or such underwriter shall be allowed the
Trustee as an expense except for payment of such reasonable amounts as the
Securities and Exchange Commission may prescribe as compensation for performing
bookkeeping and other administrative services of a character normally performed
by the Trustee.
SECTION 8.02. BOOKS, RECORDS AND REPORTS. The Trustee shall keep proper
books of record and account of all the transactions of each Trust under this
Indenture at its corporate trust office including a record of the name and
address of, and the Certificates issued by each Trust and held by, every
Unitholder, and such books and records of each Trust shall be open to inspection
by any Unitholder of such Trust at all reasonable times during the usual
business hours.
Unless the Depositor determines that such an audit is not required, the
account of each Trust shall be audited not less than annually by independent
public accountants designated from time to time by the Depositor and reports of
such accountants shall be furnished by the Trustee, upon request, to
Unitholders. The Trustee, however, in connection with any such audits shall not
be obligated to use Trust assets to pay for such audits in excess of the amounts
indicated in the Prospectus relating to such Trust.
To the extent permitted under the Investment Company Act of 1940 as
evidenced by an opinion of independent counsel to the Depositor, the Trustee
shall pay, or reimburse to the Depositor or others, the costs of the preparation
of documents and information with respect to a Trust required by law or
regulation in connection with the maintenance of a secondary market in units of
such Trust. Such costs may include but are not limited to accounting and legal
fees, blue sky registration and filing fees, printing expenses and other
reasonable expenses related to documents required under federal and state
securities laws. Such costs shall be a Trust expense and the Trustee shall not
be obligated to advance any of its own funds to make such payments.
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SECTION 8.03. REPORTS TO SECURITIES AND EXCHANGE COMMISSION AND OTHERS. The
Trustee shall make such annual or other reports as may from time to time be
required under any applicable state or federal statute or rule or regulation
thereunder.
SECTION 8.04. AGREEMENT AND LIST OF BONDS ON FILE. The Trustee shall keep a
certified copy or duplicate original of this Agreement on file at its principal
trust office available for inspection by any Unitholder at all reasonable times
during its usual business hours, and the Trustee shall keep and so make
available for inspection a current list of the Bonds in each Trust Fund.
SECTION 8.05. COMPENSATION OF TRUSTEE. The Trustee shall receive at the
times and in the manner set forth in Section 3.04 as compensation for performing
the usual, ordinary, normal and recurring services under this Agreement during
the preceding month an amount equal to the amount specified as compensation for
the Trustee in Part II of the Trust Agreement. The rate of such compensation may
be periodically adjusted in response to fluctuations in short-term interest
rates (reflecting the cost to the Trustee of advancing funds to a Trust to meet
scheduled distributions) and may be increased by the Trustee from time to time,
without the consent or approval of any Unitholder or the Depositor, by amounts
not exceeding the proportionate increase, during the period from the date of
such Trust Agreement to the date of any such increase, in consumer prices as
last published prior to each such date under the classification "All Services
Less Rent of Shelter" in the Consumer Price Index For All Urban Consumers
(CPI-U) U.S. City Average, not seasonally adjusted, based 1982 - 84 = 100,
published by the United States Department of Labor. In the event that such
classification ceases to incorporate a significant number of items, or if a
substantial change is made in the method of establishing such classification,
then the classification shall be adjusted in a fair and reasonable manner to the
figure that would have resulted had no substantial change occurred in the manner
of computing such classification. In the event that such classification (or a
successor or substitute index) is not available, such governmental or other
service or publication as shall evaluate the information in substantially the
same manner as the aforesaid classification shall be used in lieu thereof.
The Trustee shall also receive, at the times and in the manner set forth in
Section 3.04, reimbursement for any and all expenses and disbursements incurred
hereunder (except as set forth in Section 8.01(e)), including legal and auditing
expenses and additional compensation for any extraordinary services performed
hereunder, which extraordinary services shall include but not be limited to, all
costs and expenses incurred by the Trustee in making any annual or other reports
pursuant to Section 8.03, or in making any distribution of cash attributable to
failed contracts covering Contract Obligations in accordance with Section 3.04;
provided, however, that the amount of any such charge which has not been finally
determined as of any Distribution Date may be estimated and any necessary
adjustments shall be made in the succeeding period.
The Trustee shall be indemnified ratably from the Trust Funds and held
harmless against any loss, liability or expense incurred without gross
negligence, bad faith, willful misconduct or reckless disregard of its duties on
the part of the Trustee arising out of or in
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connection with the acceptance or administration of this trust, including the
costs and expenses of defending itself against any claim or liability in the
premises.
The Trustee's normal and extraordinary compensation and reimbursement of
the above-mentioned expenses and losses shall be charged by the Trustee against
the Interest and Principal Accounts of the appropriate Trust Funds in accordance
with Section 3.04 on or before each Distribution Date. If the balances in the
Interest and Principal Accounts shall be insufficient to provide for amounts
payable pursuant to this Section 8.05, the Trustee shall have the power to sell
Bonds in the manner provided in Section 5.02 hereof. The Trustee shall not be
liable or responsible in any way for depreciation or loss incurred by reason of
any sale of Bonds made pursuant to this Section 8.05.
SECTION 8.06. RESIGNATION, DISCHARGE OR REMOVAL OF THE TRUSTEE; SUCCESSORS.
(a) The Trustee may resign and be discharged of the trust created by this
Agreement by executing an instrument in writing resigning as Trustee of such
trust, filing the same with the Depositor and mailing a copy of a notice of
resignation to all Unitholders then of record, not less than sixty days before
the date specified in such instrument when, subject to Section 8.06(c), such
resignation is to take effect. Upon receiving such notice of resignation, the
Depositor shall use its best efforts promptly to appoint a successor Trustee in
the manner and meeting the qualifications hereinafter provided, by written
instrument or instruments delivered to the resigning Trustee and the successor
Trustee. Notice of such appointment of a successor Trustee shall be mailed
promptly after acceptance of such appointment by the successor Trustee to each
Unitholder then of record. The Depositor may remove the Trustee at any time with
or without cause and appoint a successor Trustee by written instrument or
instruments delivered to the Trustee so removed and the successor Trustee,
provided that a notice of such removal and appointment of a successor Trustee
shall be mailed by the successor Trustee promptly after acceptance of such
appointment to each Unitholder then of record.
(b) In case at any time the Trustee shall resign and no successor Trustee
shall have been appointed within thirty days after notice of resignation has
been received by the Depositor, the retiring Trustee may forthwith apply to a
court of competent jurisdiction for the appointment of a successor Trustee. Such
court may thereupon, after such notice, if any, as it may deem proper and
prescribe, appoint a successor Trustee.
(c) Any successor Trustee appointed hereunder shall execute and acknowledge
to the Depositor and the retiring Trustee an instrument accepting such
appointment hereunder, and such successor Trustee without any further act, deed
or conveyance shall become vested with all rights, powers, duties and
obligations of its predecessor hereunder with like effect as if originally named
a Trustee herein and shall be bound by all the terms and conditions of this
Agreement. Upon the request of such successor Trustee, the retiring Trustee
shall, upon payment of all amounts due the retiring Trustee, execute and deliver
an instrument acknowledged by it transferring to such successor Trustee all the
rights and powers of the retiring Trustee; and the retiring Trustee shall
transfer, deliver and pay over to the successor Trustee all Bonds and moneys at
the time held by it hereunder, if any, together with all necessary instruments
of transfer and assignment or other documents properly
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executed necessary to effect such transfer and such of the records or copies
thereof maintained by the retiring Trustee in the administration hereof as may
be requested by the successor Trustee and shall thereupon be discharged from all
duties and responsibilities under this Agreement. Any resignation or removal of
a Trustee and appointment of a successor Trustee pursuant to this Section 8.06
shall become effective upon such acceptance of appointment by the successor
Trustee.
(d) Any corporation into which a Trustee hereunder may be merged or with
which it may be consolidated, or any corporation resulting from any merger or
consolidation to which such Trustee hereunder shall be a party, shall be the
successor Trustee under this Agreement without the execution or filing of any
paper, instrument or further act to be done on the part of the parties hereto,
anything herein, or in any agreement relating to such merger or consolidation,
by which any such Trustee may seek to retain certain powers, rights and
privileges theretofore obtaining for any period of time following such merger or
consolidation, to the contrary notwithstanding.
SECTION 8.07. QUALIFICATION OF TRUSTEE. The Trustee and any successor
Trustee shall be a corporation organized under laws of the United States, or any
state thereof, which is authorized under such laws to exercise trust powers and
has at all times an aggregate capital, surplus and undivided profits of not less
than $500,000.
SECTION 8.08. COLLATERAL. As collateral security for the prompt payment to
the Trustee of all reimbursement to which the Trustee is entitled hereunder and
of all sums at any time owed to or payable to the Trustee hereunder (including,
without limitation, the prompt reimbursement of the Trustee for any sums that it
may from time to time in its discretion advance to the account of the Trust
Fund), the Trustee is hereby granted a first and prior lien and security
interest in and to the Trust Fund and all Bonds now or hereafter included
therein, including (without limitation) those Bonds listed in the Schedules to
the Trust Agreement, together with all Bonds, obligations, Contract Obligations
and instruments received in exchange or substitution therefor and all proceeds
thereof and all additions and substitutions.
ARTICLE IX
TERMINATION
SECTION 9.01. PROCEDURE UPON TERMINATION. This Agreement and the trust
created hereby shall terminate as to an individual Trust Fund upon the maturity,
redemption, sale or other disposition, as the case may be, of the last Bond held
hereunder in such Trust Fund, unless sooner terminated as herein before
specified, and may be terminated at any time by written instrument executed by
the Depositor and consented to by holders of Units representing 66-2/3% of the
Units of such Trust Fund then outstanding under this Agreement; provided, that
in no event shall this trust continue with respect to such Trust Fund beyond
January l of the fiftieth year after the creation of such Trust Fund.
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This Agreement and the trust created hereby shall be terminated as to the
entire Fund upon the maturity, redemption, sale or other disposition, as the
case may be, of the last Bond held hereunder, in the last maturing Trust Fund,
unless sooner terminated as herein before specified, and may be terminated at
any time by written instrument executed by the Depositor and consented to by
holders of Units representing 66-2/3% of all Units then outstanding under this
Agreement; provided that in no event shall this trust continue beyond December
31 of the year following the termination of the last Trust Fund; and provided
further that in connection with any such liquidation it shall not be necessary
for the Trustee to dispose of any Bond or Bonds if retention of such Bond or
Bonds, until due, shall be deemed to be in the best interests of Unitholders,
including, but not limited to, situations in which a Bond or Bonds insured by
the Insurance are in default, situations in which Bond or Bonds insured by the
Insurance reflect a deteriorated market price resulting from a deterioration in
credit quality and situations in which a Bond or Bonds mature after the
mandatory termination date.
Written notice of any termination, specifying the time or times at which
any Unitholder holding Certificates may surrender such Certificates for
cancellation and the date, determined by the Trustee, upon which the transfer
books of the Trustee, maintained pursuant to Section 8.02, shall be closed with
respect to the terminated Trust Fund or the entire Fund, as the case may be,
shall be given by the Trustee to Unitholders of such terminated Trust Fund or
all Unitholders, as the case may be.
Within a reasonable period of time after the termination of the entire
Fund, the Trustee shall sell all of the Bonds then held, if any, and shall:
(a) deduct from the Interest Account or to the extent that funds are
not available in such Account, from the Principal Account of every Trust
Fund separately and pay to itself individually an amount equal to the sum
of (1) its accrued compensation for its ordinary services in connection
with such Trust Fund, (2) any compensation due it for its extraordinary
services in connection with such Trust Fund and (3) any other expenses and
disbursements in connection with such Trust Fund as provided herein;
(b) deduct from the Interest Account or to the extent that funds are
not available in such account, from the Principal Account of every Trust
Fund separately and pay accrued and unpaid fees in connection with such
Trust Fund of the Evaluator, the Depositor and bond counsel, if any;
(c) deduct from the Interest Account, or to the extent that funds are
not available from such Account, from the Principal Account of every Trust
Fund separately any amounts which it in its sole discretion shall deem
requisite to be deposited in the Reserve Account to provide for any
applicable taxes or other governmental charges that may be payable out of
such Trust Fund;
(d) distribute to each Unitholder (upon surrender for cancellation of
his Certificate or Certificates, if issued) such Unitholder's interest in
the balances of the
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Interest, Principal, and, on the conditions set forth in Section 3.03
hereof, the Reserve Accounts of the Trust Fund in which he holds Units,
provided that such distribution shall be made to Unitholders of record as
of the date of such computation and shall be distributed to them within
five days or shortly thereafter;
(e) together with such distribution to each Unitholder as provided for
in paragraph (d), furnish to each such Unitholder a final statement as of
the date of the computation of the amount distributable to Unitholders of
the same Trust Fund, setting forth the data and information in
substantially the form and manner provided for in Section 3.05 hereof.
SECTION 9.02. NOTICE TO UNITHOLDERS. In the event that all of the
Unitholders holding Certificates shall not surrender their Certificates for
cancellation within six months after the time specified in the applicable,
above-mentioned notice, the Trustee shall give a second written notice to the
remaining Unitholders to surrender their Certificates for cancellation and
receive the liquidating distribution with respect thereto. If within one year
after the second notice all the Certificates issued shall not have been
surrendered for cancellation, the Trustee may take appropriate steps or may
appoint an agent to take appropriate steps to contact the remaining Unitholders
concerning surrender of their Certificates and the cost thereof shall be paid
out of the moneys and other assets which remain in the affected Trust Fund.
SECTION 9.03. MONEYS TO BE HELD IN TRUST WITHOUT INTEREST. The Trustee
shall be under no liability with respect to moneys in the Interest, Principal
and Reserve Accounts upon termination, except to hold the same in trust without
interest.
SECTION 9.04. DISSOLUTION OF DEPOSITOR NOT TO TERMINATE. The dissolution of
the Depositor shall not, subject to Section 8.01(f), operate to terminate this
Agreement or the Fund or any individual Trust Fund.
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.01. AMENDMENT AND WAIVER. This Agreement may be amended from
time to time by the Depositor and the Trustee without the consent of any of the
Unitholders (a) to cure any ambiguity or to correct or supplement any provisions
contained herein which may be defective or inconsistent with any other provision
contained herein; (b) to change any provision hereof as may be required by the
Securities and Exchange Commission or any successor governmental agency
exercising similar authority; or (c) to make such other provisions in regard to
matters or questions arising hereunder as shall not adversely affect the
interest of the Unitholders (as determined in good faith by the Depositor and
the Trustee). This Agreement may also be amended from time to time by the
Depositor and the Trustee (or the performance of any of the provisions of this
Agreement may be waived) with the consent of holders of Units representing
66-2/3% of the Units at the time
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outstanding under the Trust Agreement of the individual Trust Fund or Trust
Funds affected for the purpose of adding any provisions of this Agreement or of
modifying in any manner the rights of the holders of Units of such Trust Fund or
Trust Funds; provided, however, that in no event may any amendment be made which
would (a) alter the rights to the Unitholders as against each other, (b) provide
the Trustee with the power to engage in business or investment activities other
than as specifically provided in this Agreement or (c) adversely affect the
characterization of the Trust as a grantor trust for federal income tax
purposes; provided, further, that the consent of 100% of the Unitholders of any
individual Trust Fund is required to amend this Agreement (a) to increase the
number of Units of such Trust Fund issuable hereunder above the number of Units
specified in Part II of the Trust Agreement or such lesser amount as may be
outstanding at any time during the term of this Agreement, (b) to permit, in
addition to acquisitions permitted under Sections 3.07 and 3.12 hereof, the
acquisition hereunder of any Bonds for such Trust Fund different from those
specified in the Schedules to the Trust Agreement, (c) to reduce the aforesaid
percentage of Units the holders of which are required to consent to certain
amendments and (d) to reduce the interest in such Trust Fund represented by any
Units of such Trust Fund.
Promptly after the execution of any amendment the Trustee shall furnish
written notification of the substance of such amendment to each Unitholder then
of record affected thereby.
It shall not be necessary for the consent of Unitholders under this Section
10.01 or under Section 9.01 to approve the particular form of any proposed
amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Unitholders shall be subject to such
reasonable regulations as the Trustee may prescribe.
SECTION 10.02. INITIAL COSTS. The cost of the initial preparation, printing
and execution of any Certificates and this Agreement, the initial fees of the
Trustee and the Trustee's counsel and other reasonable expenses in connection
therewith (including stamp taxes on original issuance of the Units and penalties
and interest, if any) together with all of the cost of registering the Units and
the Fund under the Securities Act of 1933 and the Investment Company Act of
1940, respectively, shall be paid by the Depositor.
SECTION 10.03. REGISTRATION (INITIAL AND CURRENT) OF UNITS AND FUND. The
Depositor agrees and undertakes on its own part to register the Units and the
Fund with the Securities and Exchange Commission and under the Blue Sky laws of
such states as the Depositor may select.
SECTION 10.04. CERTAIN MATTERS RELATING TO UNITHOLDERS. (a) The death or
incapacity of any Unitholder shall not operate to terminate this Agreement, the
Fund or the Trust Fund in which he holds Units nor entitle his legal
representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of the Fund or such Trust
Fund, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them. Each Unitholder expressly waives any right he may
have under any rule of law, or the provisions of any statute, or otherwise, to
require the Trustee at any time
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to account, in any manner other than as expressly provided in this Agreement, in
respect of the Bonds or moneys from time to time received, held and applied by
the Trustee hereunder.
(b) No Unitholder shall have any right to vote except as provided in
Sections 9.01 and 10.01 or in any manner otherwise to control the operation of
the Fund or the obligations of the parties hereto, nor shall anything set forth
in this Agreement or the Trust Agreement or contained in the terms of any
Certificates which may have been issued be construed so as to constitute the
Unitholders from time to time as partners or members of an association; nor
shall any Unitholder ever be under any liability to any third persons by reason
of any action taken by the parties to this Agreement, or for any other cause
whatsoever.
(c) By the purchase and acceptance or other lawful delivery and acceptance
of any Unit, whether certificated or not, the Unitholder shall be deemed to be a
beneficiary of the Trust created by this Agreement and the Trust Agreement and
vested with all right, title and interest in the Trust Fund therein created to
the extent of the Unit or Units set forth whether evidenced by such Certificate
or held in uncertificated form, subject to the terms and conditions of this
Agreement and the Trust Agreement.
(d) A Unitholder may at any time tender his Units or his Certificate(s) if
held in certificated form (including any temporary Certificate or other evidence
of ownership of Units of the Trust Fund, issued by the Trustee or the Depositor)
to the Trustee for redemption, subject to and in accordance with Section 5.02.
SECTION 10.05. MISSOURI LAW TO GOVERN. This Agreement is executed and
delivered in the State of Missouri, and all laws or rules of construction of
such State, except for provisions with respect to choice of law, shall govern
the rights of the parties hereto and the Unitholders and the interpretation of
the provisions hereof.
SECTION 10.06. NOTICES. Any notice, demand, direction or instruction to be
given to the Depositor hereunder shall be in writing and shall be duly given if
mailed, first class with proper postage prepaid, or delivered to the Depositor
at 00 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxxxxx, Xxxxxxxxx 00000, or at such
other address as shall be specified in Part II of the Trust Agreement or by the
Depositor to the other parties hereto in writing. Any notice, demand, direction
or instruction to be given to the Trustee shall be in writing and shall be duly
given if mailed, first class with proper postage prepaid, or delivered to the
principal trust office of the Trustee at 000 Xxxx 00xx Xxxxxx, Xxxxxx Xxxx,
Xxxxxxxx 00000, or such other address as shall be specified to the other parties
hereto by the Trustee in writing. Any notice, demand, direction or instruction
to be given to the Evaluator hereunder shall be in writing and shall be duly
given if mailed, first class with proper postage prepaid, or delivered to the
Evaluator at 00 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxxxxx, Xxxxxxxxx 00000,
or at such other address as shall be specified by the Evaluator to the other
parties hereto in writing. Any notice to be given to a Unitholder shall be duly
given if mailed, first class with proper postage prepaid, or delivered to each
Unitholder at the address of such holder appearing on the registration books of
the Trustee.
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SECTION 10.07. SEVERABILITY. If any one or more of the covenants,
agreements, provisions or terms shall be for any reason whatsoever held invalid,
then such covenants, agreements, provisions or terms shall be deemed severable
from the remaining covenants, agreements, provisions or terms of this Agreement
and shall in no way affect the validity or enforceability of the other
provisions of this Agreement or of any Certificates or the rights of the holders
thereof.
SECTION 10.08. SEPARATE AND DISTINCT SERIES. Each series of Voyageur
Tax-Exempt Trust, to which these Standard Terms and Conditions of Trust shall be
applicable shall, for all financial and administrative purposes, be considered
separate and distinct from every other series, and neither the assets of nor the
expenses of any one series shall be applied or charged against any other series.
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IN WITNESS WHEREOF, the parties hereto have caused these Standard Terms and
Conditions of Trust, Effective January 19, 1995 to be duly executed.
VOYAGEUR FUND MANAGERS, INC.
Depositor
By______________________________________
Chief Financial Officer
INVESTORS FIDUCIARY TRUST COMPANY,
Trustee
