Exhibit 1.1
CLAYMORE SECURITIES DEFINED PORTFOLIOS,
SERIES 316
ZACKS SELECT PORTFOLIO, SERIES 3
REFERENCE TRUST AGREEMENT
This Reference Trust Agreement dated as of August 4, 2006, between
Claymore Securities, Inc., as Depositor, and The Bank of New York, as Trustee,
sets forth certain provisions in full and incorporates other provisions by
reference to the document entitled "Standard Terms and Conditions of Trust For
Series Formed on or Subsequent to December 18, 2001" (herein called the
"Standard Terms and Conditions of Trust"), and such provisions as are set forth
in full and such provisions as are incorporated by reference constitute a single
instrument. All references herein to Articles and Sections are to Articles and
Sections of the Standard Terms and Conditions of Trust.
WITNESSETH THAT:
In consideration of the premises and of the mutual agreements herein
contained, the Depositor and the Trustee agree as follows:
PART I.
STANDARD TERMS AND CONDITIONS OF TRUST
Subject to the provisions of Part II hereof, all the provisions
contained in the Standard Terms and Conditions of Trust are herein incorporated
by reference in their entirety and shall be deemed to be a part of this
instrument as fully and to the same extent as though said provisions had been
set forth in this instrument.
PART II.
SPECIAL TERMS AND CONDITIONS OF TRUST
The following special terms and conditions are hereby agreed to:
(1) The securities listed in the Schedule hereto have been deposited in
the Trust(s) under this Reference Trust Agreement as indicated on the attached
Schedule A.
(2) For the purposes of the definition of the term "Unit" in Article I,
it is hereby specified that the fractional undivided interest in and ownership
of a Trust is the amount described in Amendment No. 1 to the Trust's
Registration Statement (Registration No. 333-1358996) as filed with the
Securities and Exchange Commission today. The fractional undivided interest may
(a) increase by the number of any additional Units issued pursuant to Section
2.03, (b) increase or decrease in connection with an adjustment to the number of
Units pursuant to Section 2.03, or (c) decrease by the number of Units redeemed
pursuant to Section 5.02.
(3) The term "Deferred Sales Charge" shall mean the "deferred sales
fee" as described in the Prospectus.
(4) The terms "Income Account Record Date" and "Capital Account Record
Date" shall mean the dates set forth under "Essential Information--Record Dates"
in the Prospectus.
(5) The terms "Income Account Distribution Date" and "Capital Account
Distribution Date" shall mean the dates set forth under "Essential
Information--Distribution Dates" in the Prospectus.
(6) The term "Initial Date of Deposit" shall mean the date of this
Reference Trust Agreement as set forth above.
(7) The definition of "Supplemental Indenture" is hereby deleted in its
entirety.
(8) The definition of "Addendum to the Reference Trust Agreement" is
hereby deleted in its entirety.
(9) The term "Additional Securities" shall mean such Securities which
have been deposited pursuant to Section 2.05 to effect an increase over the
number of Units initially specified in the Reference Trust Agreement.
(10) The number of Units of the Trust(s) referred to in Section 2.03
shall be equal to the "Number of Units" in the Statement(s) of Financial
Condition in the Prospectus.
(11) The first paragraph of Section 5.01 is hereby amended and restated
to read as follows:
Section 5.01. Trust Evaluation. As of the Evaluation Time (a) on
the last Business Day of each year, (b) on the day on which any Unit is
tendered for redemption and (c) on any other day desired by the Trustee
or requested by the Depositor, the Trustee shall: Add (i) all moneys on
deposit in a Trust (excluding (1) cash, cash equivalents or Letters of
Credit deposited pursuant to Section 2.01 hereof for the purchase of
Contract Securities, unless such cash or Letters of Credit have been
deposited in the Interest and Principal Accounts because of failure to
apply such moneys to the purchase of Contract Securities pursuant to
the provisions of Sections 2.01, 3.03 and 3.04 hereof and (2) moneys
credited to the Reserve Account pursuant to Section 3.05 hereof), plus
(ii) the aggregate Evaluation of all Securities (including Contract
Securities and Reinvestment Securities) on deposit in such Trust as is
determined by the Evaluator (such evaluations shall take into account
and itemize separately (i) the cash on hand in the Trust or moneys in
the process of being collected from matured interest coupons or bonds
matured or called for redemption prior to maturity, (ii) the value of
each issue of the Securities in the Trust on the bid side of the market
as determined by the Evaluator pursuant to Section 4.01, and (iii)
interest accrued thereon not subject to collection and distribution).
For each such Evaluation there shall be deducted from the sum of the
above (i) amounts representing any applicable taxes or governmental
charges payable out of the respective Trust and for which no deductions
shall have previously been made for the purpose of addition to the
Reserve Account, (ii) amounts representing estimated accrued fees of
the Trust and expenses of such Trust including but not limited to
unpaid fees and expenses of the Trustee, the Evaluator, the Supervisor,
the Depositor and bond counsel, in each case as reported by the Trustee
to the Evaluator on or prior to the date of evaluation, (iii) any
moneys identified by the Trustee, as of the date of the Evaluation, as
held for distribution to Unitholders of record as of a Record Date or
for payment of the Redemption Value of Units tendered prior to such
date and (iv) unpaid organization costs in the estimated amount per
Unit set forth in the Prospectus. The resulting figure is herein called
a "Trust Fund Evaluation." The value of the pro rata share of each Unit
of the respective Trust determined on the basis of any such evaluation
shall be referred to herein as the "Unit Value."
(12) Article III is hereby amended by adding the following section:
Section 3.23. Bookkeeping and Administrative Expenses. If so
provided in the Prospectus, as compensation for providing bookkeeping
and other administrative services of a character described in Section
26(a)(2)(C) of the Investment Company Act of 1940 to the extent such
services are in addition to, and do not duplicate, the services to be
provided hereunder by the Trustee or the Depositor for providing
supervisory services, the Depositor shall receive at the times
specified in Section 3.05, against a statement or statements therefor
submitted to the Trustee an aggregate annual fee in an amount which
shall not exceed that amount set forth in the Prospectus, calculated as
specified in Section 3.05, but in no event shall such compensation,
when combined with all compensation received from other series of the
Trust or other unit investment trusts sponsored by the Depositor or its
affiliates for providing such bookkeeping and administrative services
in any calendar year exceed the aggregate cost to the Depositor for
providing such services to such unit investment trusts. Such
compensation may, from time to time, be adjusted provided that the
total adjustment upward does not, at the time of such adjustment,
exceed the percentage of the total increase, during the period from the
Trust Agreement to the date of any such increase, in consumer prices
for services as measured by the United States Department of Labor
Consumer Price Index entitled "All Services Less Rent of Shelter" or
similar index as described under Section 3.18. The consent or
concurrence of any Unitholder hereunder shall not be required for any
such adjustment or increase. Such compensations shall be paid by the
Trustee, upon receipt of invoice therefor from the Depositor, upon
which, as to the cost incurred by the Depositor of providing services
hereunder the Trustee may rely, and shall be charged against the Income
and Capital Accounts as specified in Section 3.05. The Trustee shall
have no liability to any Unitholder or other person for any payment
made in good faith pursuant to this Section.
If the cash balance in the Income and Capital Accounts shall be
insufficient to provide for amounts payable pursuant to this Section
3.23, the Trustee shall have the power to sell (1) Securities from the
current list of Securities designated to be sold pursuant to Section
5.02 hereof, or (2) if no such Securities 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 3.23. Any moneys payable to the
Depositor pursuant to this Section 3.23 shall be secured by a prior
lien on the Trust except that no such lien shall be prior to any lien
in favor of the Trustee under the provisions of Section 6.04.
Any moneys payable to the Depositor pursuant to this Section 3.23
shall be secured by a prior lien on the Trust except that no such lien
shall be prior to any lien in favor of the Trustee under the provisions
of Section 6.04.
(13) The phrases "supervisory services," "supervisory portfolio
services" and "portfolio supervisory services" in Sections 3.18 are hereby
replaced with the phrase "portfolio supervisory services and bookkeeping and
administrative expenses."
(14) Section 7.05 is hereby amended and replaced in its entirety with
the following:
Section 7.05. Compensation. The Depositor shall receive at the
times set forth in Sections 3.05, 3.18, 3.23 and 4.03 as compensation
for performing portfolio supervisory services, bookkeeping and
administrative expenses and evaluation services, such amount and for
such periods as specified the Prospectus and/or Reference Trust
Agreement. The compensation for providing portfolio supervisory
services, bookkeeping and administrative expenses and evaluation
services shall be made on the basis of the largest number of units
outstanding at any time during the period for which such compensation
is being computed. At no time, however, will the total amount received
by the Depositor for services rendered to all series of Claymore
Securities Defined Portfolios in any calendar year exceed the aggregate
cost to them of supplying such services in such year. Such rate 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
Prospectus and/or Reference Trust Agreement to the date of any such
increase, in consumer prices as published either under the
classification "All Services Less Rent" in the Consumer Price Index
published by the United States Department of Labor or, IF such Index is
no longer published, a similar index.
In the event that any amount of the compensation paid to the
Depositor pursuant to Sections 3.05, 3.18 and 3.23 and 4.03 is found to
be an improper charge against a Trust, the Depositor shall reimburse
the Trust in such amount. An improper charge shall be established if a
final judgment or order for reimbursement of the Trust shall be
rendered against the Depositor and such judgment or order shall not be
effectively stayed or a final settlement is established in which the
Depositor agrees to reimburse the Trust for amounts paid to the
Depositor pursuant to this Section 7.05.
(15) The first two sentences of Section 3.22 are hereby amended and
replaced with the following:
Section 3.22. Creation and Development Fee. If the Prospectus
related to a Trust specifies a creation and development fee, the
Trustee shall, on or immediately after the end of the initial offering
period, withdraw from the Capital Account, an amount equal to the
unpaid creation and development fee as of such date and credit such
amount to a special non-Trust account designated by the Depositor out
of which the creation and development fee will be distributed to the
Depositor (the "Creation and Development Account"). The creation and
development fee is the per unit amount specified in the Prospectus for
the Trust.
(16) Article III is hereby amended by adding the following section:
Section 3.24. License Fees. If so provided in the Prospectus, the
Depositor may enter into a Licensing Agreement (the "Agreement") with a
licensor (the "Licensor") described in the Prospectus in which the
Trust(s), as consideration for the licenses granted by the Licensor for
the right to use its trademarks and trade names, intellectual property
rights or for the use of databases and research owned by the Licensor,
will pay a fee set forth in the Agreement to the applicable Licensor or
the Depositor to reimburse the Depositor for payment of the expenses.
If the Agreement provides for an annual license fee computed in
whole or part by reference to the average daily net asset value of the
Trust assets, for purpose of calculating the accrual of estimated
expenses such annual fee shall accrue at a daily rate and the Trustee
is authorized to compute an estimated license fee payment (i) until the
Depositor has informed the Trustee that there will be no further
deposits of additional Securities, by reference to an estimate of the
average daily net asset value of the Trust assets which the Depositor
shall provide the Trustee, (ii) thereafter and during the calendar
quarter in which the last business day of the period described in
clause (i) occurs, by reference to the net asset value of the Trust
assets as of such last business day, and (iii) during each subsequent
calendar quarter, by reference to the net asset value of the Trust
assets as of the last business day of the preceding calendar quarter.
The Trustee shall adjust the net asset value (Trust Fund Evaluation) as
of the dates specified in the preceding sentence to account for any
variation between accrual of estimated license fee and the license fee
payable pursuant to the Agreement, but such adjustment shall not affect
calculations made prior thereto and no adjustment shall be made in
respect thereof.
(17) Sections 2.05(a) and 2.05(b) are hereby amended and replaced in
their entirety with the following:
Section 2.05. Deposit of Additional Securities. (a) Subject to the
requirements set forth below in this Section, the Depositor may, on any
Business Day (the "Trade Date"), subscribe for Additional Units as
follows:
(1) Prior to the Evaluation Time defined in Section 5.01 on
the Trade Date, the Depositor shall provide notice (the
"Subscription Notice") to the Trustee of the Depositor's
intention to subscribe for Additional Units. The Subscription
Notice shall identify the Additional Securities to be acquired
(unless such Additional Securities are a precise replication
of the then existing portfolio) and shall either (i) specify
the quantity of Additional Securities to be deposited by the
Depositor on the settlement date for such subscription or (ii)
instruct the Trustee to purchase Additional Securities with an
aggregate cost as specified in the Subscription Notice.
(2) Promptly following the Evaluation Time on such Business
Day, the Depositor shall verify with the Trustee, the number
of Additional Units to be created.
(3) Not later than the time on the settlement date for such
subscription when the Trustee is to deliver the Additional
Units created thereby (which time shall not be later than the
time by which the Trustee is required to settle any contracts
for the purchase of Additional Securities entered into by the
Trustee pursuant to the instruction of the Depositor referred
to in subparagraph (1) above), the Depositor shall deposit
with the Trustee (i) any Additional Securities specified in
the Subscription Notice (or contracts to purchase such
Additional Securities together with cash or a letter of credit
in the amount necessary to settle such contracts) or (ii) cash
or a letter of credit in the amount equal to the aggregate
cost of the Additional Securities to be purchased by the
Trustee, as specified in the Subscription Notice, together
with, in each case, Cash defined below. "Cash" means, as to
the Capital Account, cash or other property (other than
Securities) on hand in the Capital Account or receivable and
to be credited to the Capital Account as of the Evaluation
Time on the Business Day preceding the Trade Date (other than
amounts to be distributed solely to persons other than persons
receiving the distribution from the Capital Account as holders
of Additional Units created by the deposit), and, as to the
Income Account, cash or other property (other than Securities)
received by the Trust as of the Evaluation Time on the
Business Day preceding the Trade Date or receivable by the
Trust in respect of dividends or other distributions declared
but not received as of the Evaluation Time on the Business Day
preceding the Trade Date, reduced by the amount of any cash or
other property received or receivable on any Security
allocable (in accordance with the Trustee's calculation of the
monthly distribution from the Income Account pursuant to
Section 3.05) to a distribution made or to be made in respect
of a Record Date occurring prior to the Trade Date. Each
deposit made pursuant to this Section 2.05 shall replicate, to
the extent practicable, the portfolio immediately prior to
such deposit.
(4) On the settlement date for a subscription, the Trustee
shall, in exchange for the Securities and cash or Letter of
Credit described above, issue and deliver to or on the order
of the Depositor the number of Units verified by the Depositor
with the Trustee. No Unit to be issued pursuant to this
paragraph shall be issued or delivered unless and until
Securities, cash or a Letter of Credit is received in exchange
therefor and no person shall have any claim to any Unit not so
issued and delivered or any interest in the Trust in respect
thereof.
(5) Any Additional Securities shall be held, administered and
applied by the Trustee in the same manner as herein provided
for the Securities.
(6) The acceptance of Additional Units by the Depositor in
accordance with the provisions of paragraph (a) of this
Section shall be deemed a certification by the Depositor that
the deposit or purchase of Additional Securities associated
therewith complies with the conditions of this Section 2.05.
(7) Notwithstanding the preceding, in the event that the
Depositor's Subscription Notice shall instruct the Trustee to
purchase Additional Securities in an amount which, when added
to the purchase amount of all other unsettled contracts
entered into by the Trustee, exceeds 25% of the value of the
Securities then held (taking into account the value of
contracts to purchase Securities only to the extent that there
has been deposited with the Trustee cash or an irrevocable
letter of credit in an amount sufficient to settle their
purchase), the Depositors shall deposit with the Trustee
concurrently with the Subscription Notice cash or a letter of
credit in an amount such that, when added to 25% of the value
of the Securities then held (determined as above) the
aggregate value shall be not less than the purchase amount of
the securities to be purchased pursuant to such Subscription
Notice.
(b) Instructions to purchase Additional Securities under this
Section shall be in writing and shall direct the Trustee to purchase,
or enter into contracts to purchase, Additional Securities; such
instructions shall also specify the name, CUSIP number, if any,
aggregate amount of each such Additional Security and price or range of
price. If, at the time of a subsequent deposit under this Section,
Securities of an Original Issue are unavailable, cannot be purchased at
reasonable prices or their purchase is prohibited or restricted by
applicable law, regulation or policies, in lieu of the portion of the
deposit that would otherwise be represented by those Securities, the
Depositor may (A) deposit (or instruct the Trustee to purchase)
Securities of another Original Issue or (B) deposit cash or a letter of
credit with instructions to acquire the Securities of such Original
Issue when they become available.
(18) Section 4.01(b) is replaced in its entirety by the following:
(b) During the initial offering period such Evaluation shall be
made in the following manner: if the Securities are listed on a
national securities exchange or foreign securities exchange, such
Evaluation shall generally be based on the last available sale price on
or immediately prior to the Evaluation Time on the exchange which is
the principal market therefor, which shall be deemed to be the New York
Stock Exchange if the Securities are listed thereon (unless the
Evaluator deems such price inappropriate as a basis for evaluation) or,
if there is no such available sale price on such exchange, at the last
available offer prices of the Securities. Securities not listed on the
New York Stock Exchange but principally traded on the Nasdaq National
Market System will be valued at Nasdaq's official close price. If the
Securities are not so listed or, if so listed, the principal market
therefor is other than on such exchange or there is no such available
sale price on such exchange, such Evaluation shall generally be based
on the following methods or any combination thereof whichever the
Evaluator deems appropriate: (i) on the basis of the current offer
price for comparable securities (unless the Evaluator deems such price
inappropriate as a basis for evaluation), (ii) by determining the
valuation of the Securities on the offer side of the market by
appraisal or (iii) by any combination of the above. If the Trust holds
Securities denominated in a currency other than U.S. dollars, the
Evaluation of such Security shall be converted to U.S. dollars based on
current offering side exchange rates (unless the Evaluator deems such
prices inappropriate as a basis for valuation). The Evaluator shall add
to the Evaluation of each Security which is traded principally on a
foreign securities exchange the amount of any commissions and relevant
taxes associated with the acquisition of the Security. As used herein,
the closing sale price is deemed to mean the most recent closing sale
price on the relevant securities exchange immediately prior to the
Evaluation Time. For each Evaluation, the Evaluator shall also confirm
and furnish to the Trustee and the Depositor, on the basis of the
information furnished to the Evaluator by the Trustee as to the value
of all Trust assets other than Securities, the calculation of the Trust
Fund Evaluation to be computed pursuant to Section 5.01.
(19) Section 4.01(c) is replaced in its entirety by the following:
(c) For purposes of the Trust Fund Evaluations required by Section
5.01 in determining Redemption Value and Unit Value and for secondary
market purchases, Evaluation of the Securities shall be made in the
manner described in 4.01(b), on the basis of the last available bid
prices of the Securities (rather than offer prices), except in those
cases in which the Securities are listed on a national securities
exchange or a foreign securities exchange and the last available sale
prices are utilized. In addition, with respect to each Security which
is traded principally on a foreign securities exchange, the Evaluator
shall (i) not make the addition specified in the fourth sentence of
Section 4.01(b) and (ii) shall reduce the Evaluation of each Security
by the amount of any liquidation costs (other than brokerage costs
incurred on any national securities exchange) and any capital gains or
other taxes which would be incurred by the Trust upon the sale of such
Security, such taxes being computed as if the Security were sold on the
date of the Evaluation.
(20) Section 9.05 is hereby revised to read as follows:
Section 9.05. Written Notice. Any notice, demand, direction or
instruction to be given to the Depositor, Evaluator or Supervisor
hereunder shall be in writing and shall be duly given if mailed or
delivered to the Depositor, 0000 Xxxxxxxxx Xxxx Xxxxx, Xxxxx, Xxxxxxxx
00000, or at such other address as shall be specified by the Depositor
to the other parties hereto in writing.
(21) The second paragraph of Section 6.02 is replaced in its entirety as
follows:
An audit of the accounts of each Trust shall not be conducted
unless the Depositor determines that such an audit is
required. In the event that the Depositor determines that an
audit is required, the accounts 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, if
any, indicated in the Prospectus relating to such Trust. The
Trustee shall maintain and provide, upon the request of a
Unitholder or the Depositor, the Unitholders' or the
Unitholder's designated representative with the cost basis of
the Securities represented by the Unitholder's Units.
(22) The first paragraph of Section 6.04 is replaced in its entirety as
follows:
Section 6.04. Compensation. Subject to the provisions of Section
3.14 hereof, the Trustee shall receive at the times set forth in
Section 3.05, as compensation for performing ordinary normal recurring
services under this Indenture, an amount calculated at the annual
compensation rate stated in the Prospectus. The Trustee shall charge a
pro rated portion of its annual fee at the times specified in Section
3.05, which pro rated portion shall be calculated on the basis of the
largest number of Units in such Trust at any time during the primary
offering period. After the primary offering period has terminated, the
fee shall accrue daily and be based on the number of Units outstanding
on the first business day of each calendar year in which the fee is
calculated or the number of Units outstanding at the end of the primary
offering period, as appropriate. The Trustee may from time to time
adjust its compensation as set forth above, provided that total
adjustment upward does not, at the time of such adjustment, exceed the
percentage of the total increase, after the date hereof, in consumer
prices for services as measured by the United States Department of
Labor Consumer Price Index entitled "All Services Less Rent," or, if
such index shall cease to be published, then as measured by the
available index most nearly comparable to such index. The consent or
concurrence of any Unitholder hereunder shall not be required for any
such adjustment or increase, however, the consent of the Depositor
shall be required. Such compensation shall be charged by the Trustee
against the Income and Capital Accounts of each Trust; provided,
however, that such compensation shall be deemed to provide only for the
usual, normal and proper functions undertaken as Trustee pursuant to
this Indenture.
(23) Section 2.03 is hereby amended and replaced in its entirety with
the following:
Section 2.03. Issuance of Units. By executing the Reference Trust
Agreement and receipt for deposited Securities, the Trustee will
thereby acknowledge receipt of the deposit of the Securities listed in
the Schedules to the Reference 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 by the Depositor, of
the aggregate number of Units specified in the Reference Trust
Agreement and has delivered, or on the order of the Depositor will
deliver, in exchange for such Securities, cash or a Letter of Credit,
documentation evidencing the ownership of the number of Units specified
or, if requested by the Depositor, the ownership by DTC of all such
Units and will cause such Units to be credited at DTC to the account of
the Depositor or, pursuant to the Depositor's direction and as
hereafter provided, the account of the issuer of the Letter of Credit
referred to in Section 2.01. The number of Units in a Trust may be
increased through a split of the Units or decreased through a reverse
split thereof, as directed by the Depositor, on any day on which the
Depositor is the only Unitholder of such Trust, which revised number of
Units shall be recorded by the Trustee on its books. Effective as of
the Evaluation Time on August 4, 2006, in the event that the aggregate
value of Securities in the Trust has increased since the evaluation on
August 3, 2006, the Trustee shall issue such number of additional Units
to the Unitholder of outstanding Units as of the close of business on
August 3, 2006, that the price per Unit computed as of the Evaluation
Time on August 4, 2006, plus the maximum applicable sales charge shall
equal approximately $10 per Unit (based on the number of Units
outstanding as of said Evaluation Time, including the additional Units
issued pursuant to this sentence); in the event that the aggregate
value of Securities in the Trust Fund has decreased since the
evaluation on August 3, 2006, there will be a reverse split of the
outstanding Units, and said Unitholder will surrender to the Trustee
for cancellation such number of Units, that the price per Unit computed
as of the Evaluation Time on August 4, 2006, plus the maximum
applicable sales charge shall equal approximately $10 per Unit (based
on the number of Units outstanding as of said Evaluation Time,
reflecting cancellation of Units pursuant to this sentence). The
Trustee hereby agrees that on the date of any deposit of additional
Securities pursuant to Section 2.05 it shall acknowledge that the
additional Securities 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
Securities so deposited.
(24) Section 2.01 is hereby amended and replaced in its entirety with
the following:
Section 2.01. Deposit of Securities. The Depositor, on the date of
the Reference Trust Agreement, has deposited with the Trustee in trust
the Securities and contracts (or cash or a Letter of Credit in the
amount necessary to settle any contracts for the purchase of Securities
entered into by the Trustee pursuant to the instructions of the
Depositor) for the purchase of Contract Securities listed in the
Schedules to the Reference Trust Agreement in bearer form or duly
endorsed in blank or accompanied by all necessary instruments of
assignment and transfer in proper form or Contract Securities relating
to such Securities to be held, managed and applied by the Trustee as
herein provided. The Depositor shall deliver the Securities listed on
said Schedules which were not actually delivered concurrently with the
execution and delivery of the Reference Trust Agreement and which were
represented by Contract Securities to the Trustee within 10 calendar
days after said execution and delivery (the "Delivery Period"). In the
event that the purchase of Contract Securities pursuant to any contract
shall not be consummated in accordance with said contract or if the
Securities represented by Contract Securities are not delivered to a
Trust in accordance with this Section 2.01 and the moneys, or, if
applicable, the moneys drawn on the Letter of Credit, deposited by the
Depositor are not utilized for Section 3.17 purchases of Replacement
Securities, such funds, to the extent of the purchase price of Failed
Contract Securities for which no Replacement Security were acquired
pursuant to Section 3.17, plus all amounts described in the next
succeeding sentence, shall be credited to the Capital Account and
distributed pursuant to Section 3.05 to Unitholders of record as of the
Income Account 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 Failed Contract
Security. Any amounts remaining from moneys drawn on the Letter of
Credit which are not used to purchase Replacement Securities or are not
used to provide refunds to Unitholders shall be paid to the Depositor.
The Trustee is hereby irrevocably authorized to effect registration or
transfer of the Securities in fully registered form to the name of the
Trustee or to the name of its nominee or to hold the Securities in a
clearing agency registered with the Securities and Exchange Commission
or in a book entry system operated by the Federal Reserve Board.
(25) The first two sentences in the first paragraph of Section 3.11 are
hereby deleted and replaced in their entirety with the following:
In the event that an offer by the issuer of any of the
Securities or any other party shall be made to issue new
securities, or to exchange securities, for Trust Securities,
the Trustee will, at the direction of the Depositor, accept or
reject such offer or vote for or against any offer for new or
exchanged securities or property in exchange for a Trust
Security. Should any issuance, exchange or substitution be
effected, any securities, cash and/or property received shall
be deposited hereunder and shall be promptly sold, if
securities or property, by the Trustee pursuant to the
Depositor's direction, unless the Depositor advises the
Trustee to keep such securities or property.
(26) Section 3.05 is hereby amended by adding the following as
subsection (c):
(c) Notwithstanding the foregoing, if a Trust has elected to
be treated as a "regulated investment company" as defined in
the Internal Revenue Code, the Trustee may make such
additional distributions to Unitholders as shall be determined
by the Depositor or such agent as the Depositor shall
designate to be necessary or desirable to maintain the status
of each Trust as a regulated investment company or to avoid
imposition of any income or excise taxes on undistributed
income of the Trust. The Trustee shall be authorized to rely
conclusively upon the direction, and shall have no duty to
make any additional distributions from a Trust in the absence
of such direction. The Trustee shall have no liability for any
tax or other liability incurred by reason of action or
inaction resulting from such direction. The fees of such agent
designated by the Depositor shall be an expense of the Trust
reimbursable to the Trustee in accordance with Section 6.04.
(27) Section 9.01 is hereby amended by adding the following as
subsection (d):
(d) If a Trust has elected to be treated as a "regulated
investment company" as defined in the Internal Revenue Code
and notwithstanding Section 9.01(a), this Indenture may be
amended from time to time by the Depositor and the Trustee
without the consent of any of the Unitholders (1) 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; (2) to change any provision hereof
as may be required by the Securities and Exchange Commission
or any successor governmental agency exercising similar
authority; (3) to make such amendments as may be necessary for
each Trust to continue to qualify as a regulated investment
company for federal income tax purposes; or (4) 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 Indenture may also be amended from time to
time by the Depositor and the Trustee (or the performance of
any of the provisions of this Indenture may be waived) with
the consent of holders of Units representing 66-2/3% of the
Units at the time outstanding under the Trust Indenture of the
individual Trust or Trusts affected for the purpose of adding
any provisions of this Indenture or of materially modifying in
any manner the rights of the holders of Units of such Trust or
Trusts; provided, however, that in no event may any amendment
be made which would (1) alter the rights to the Unitholders as
against each other, (2) provide the Trustee with the power to
engage in business or investment activities other than as
specifically provided in this Indenture or (3) adversely
affect the characterization of a Trust as a regulated
investment company for federal income tax purposes; provided,
further, that the consent of 100% of the Unitholders of any
individual Trust is required to amend this Indenture (1) to
reduce the aforesaid percentage of Units the holders of which
are required to consent to certain amendments and (2) to
reduce the interest in such Trust represented by any Units of
such Trust.
Promptly after the execution of any amendment requiring the
consent of the Unitholders or any of any other amendment if
directed by the Depositor, 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 9.01 or under Section 9.02 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.
(28) Section 3.01 is hereby amended by as follows:
Section 3.01. Initial Costs. Subject to reimbursement as
hereinafter provided, the cost of organizing the Trust and sale of the
Trust Units shall be borne by the Depositor, provided, however, that
the liability on the part of the Depositor under this Section shall not
include any fees or other expenses incurred in connection with the
administration of the Trust subsequent to the deposit referred to in
Section 2.01. Upon notification from the Depositor that the primary
offering period is concluded, or after six months, at the discretion of
the Depositor, the Trustee shall withdraw from the Account or Accounts
specified in the Prospectus or, if no Account is therein specified,
from the Capital Account as further set forth in Section 3.03, and pay
to the Depositor the Depositor's reimbursable expenses of organizing
the Trust and sale of the Trust Units in an amount certified to the
Trustee by the Depositor but not in excess of the estimated per-Unit
amount set forth in the Prospectus multiplied by the number of Units
outstanding as of the conclusion of the primary offering period. If the
cash balance of the Capital Account is insufficient to make such
withdrawal, the Trustee shall, as directed by the Depositor, sell
Securities identified by the Depositor, or distribute to the Depositor
Securities having a value, as determined under Section 4.01 as of the
date of distribution, sufficient for such reimbursement. Securities
sold or distributed to the Depositor to reimburse the Depositor
pursuant to this Section shall be sold or distributed by the Trustee to
the extent practicable, in the percentage ratio then existing (unless
the Trust elects to be treated as a "regulated investment company" as
defined in the United States Internal Revenue Code (the "Internal
Revenue Code"), in which case sales or distributions by the Trustee
shall be made in accordance with the instructions of the Depositor or
its designees). The reimbursement provided for in this Section shall be
for the account of the Unitholders of record at the conclusion of the
primary offering period. Any assets deposited with the Trustee in
respect of the expenses reimbursable under this Section shall be held
and administered as assets of the Trust for all purposes hereunder. The
Depositor shall deliver to the Trustee any cash identified in the
Statement of Financial Condition of the Trust included in the
Prospectus not later than the First Settlement Date and the Depositor's
obligation to make such delivery shall be secured by the Letter of
Credit deposited pursuant to Section 2.01. Any cash which the Depositor
has identified as to be used for reimbursement of expenses pursuant to
this Section shall be held by the Trustee, without interest, and
reserved for such purpose and, accordingly, prior to the conclusion of
the primary offering period, shall not be subject to distribution or,
unless the Depositor otherwise directs, used for payment of redemptions
in excess of the per-Unit amount payable pursuant to the next sentence.
If a Unitholder redeems Units prior to the conclusion of the primary
offering period, the Trustee shall pay to the Unitholder, in addition
to the Redemption Price of the tendered Units, an amount equal to the
estimated per-Unit cost of organizing the Trust and the sale of Trust
Units set forth in the Prospectus multiplied by the number of Units
tendered for redemption; to the extent the cash on hand in the Trust is
insufficient for such payment, the Trustee shall have the power to sell
Securities in accordance with Section 5.02. As used herein, the
Depositor's reimbursable expenses of organizing the Trust and sale of
the Trust Units shall include the cost of the initial preparation and
typesetting of the registration statement, prospectuses (including
preliminary prospectuses), the indenture, and other documents relating
to the Trust, Securities and Exchange Commission and state blue sky
registration fees, the cost of the initial valuation of the portfolio
and audit of the Trust, the costs of a portfolio consultant, the
initial fees and expenses of the Trustee, and legal and other
out-of-pocket expenses related thereto but not including the expenses
incurred in the printing of preliminary prospectuses and prospectuses,
expenses incurred in the preparation and printing of brochures and
other advertising materials and any other selling expenses.
(29) Section 3.05 is hereby amended by adding the following as
subsection (b)(vi):
(b)(vi) Notwithstanding the foregoing, The Trustee shall not
be required to make a distribution from the Income Account or
the Capital Account unless the aggregate cash available for
distribution within the meaning of Treas. Reg 1.671-5T(b)(5)
from the Income Account and the Capital Account is equal to or
greater than .1% of the net asset value of the Trust on the
related Record Date, provided, however, that the Trustee shall
in any event distribute the balance of the Income Account and
Capital Account on the Distribution Date occurring in December
of each year (including in such distribution income receivable
by the Trust on or prior to the December Distribution Date).
This provision is intended to comply with Treas. Reg.
1.675-5T(c)(2)(v)(C), and shall interpreted consistent
therewith and with any successor regulation.
This Reference Trust Agreement shall be deemed effective when executed
and delivered by the Sponsor and the Trustee.
IN WITNESS WHEREOF, the parties hereto have caused this Reference
Trust Agreement to be duly executed.
CLAYMORE SECURITIES, INC., DEPOSITOR
By /s/ Xxxxxxxx Xxxxxxx
------------------------------------------------------
Senior Managing Director and
General Counsel
THE BANK OF NEW YORK, TRUSTEE
By /s/ Xxxx Xxxxxxx
----------------------------------------------------
Vice President
Exhibit 1.1
SCHEDULE A
SECURITIES INITIALLY DEPOSITED
CLAYMORE SECURITIES DEFINED PORTFOLIOS, SERIES 316
(Note: Incorporated herein and made a part hereof are the "Trust
Portfolio(s)" as set forth in the Prospectus.)
