between

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EXHIBIT 2(k)(2)

BROKER-DEALER AGREEMENT

between

BANKERS TRUST COMPANY

and

-------------------------------------

Dated as of _________, 1999

Relating to

MUNICIPAL AUCTION RATE CUMULATIVE PREFERRED SHARES

XXXXXX STRATEGIC MUNICIPAL INCOME TRUST
2

TABLE OF CONTENTS

PAGE

I. DEFINITIONS AND RULES OF CONSTRUCTION................................................................... 3

1.1. Terms Defined by Reference to the Certificate......................................................... 3
1.2. Terms Defined Herein.................................................................................. 3
1.3. Rules of Construction ................................................................................ 4

II. NOTIFICATION OF DIVIDEND PERIOD AND ADVANCE NOTICE OF ALLOCATION OF TAXABLE INCOME ..................... 4

III. THE AUCTION ............................................................................................ 5

3.1. Purpose; Incorporation by Reference of Auction Procedures
and Settlement Procedures..................................................................................... 5
3.2. Preparation for Each Auction.......................................................................... 5
3.3. Auction Schedule; Method of Submission of Orders ..................................................... 6
3.4. Notice of Auction Results ............................................................................ 7
3.5. Service Charge to Be Paid to BD....................................................................... 7

IV. THE AUCTION AGENT ...................................................................................... 8

4.1. Duties and Responsibilities........................................................................... 8
4.2. Rights of the Auction Agent........................................................................... 8
4.3. Auction Agent's Disclaimer............................................................................ 9

V. MISCELLANEOUS .......................................................................................... 9

5.1. Termination........................................................................................... 9
5.2. Participant in Securities Depository; Payment of Dividends in Same-Day Funds.......................... 9
5.3. Agent Member ......................................................................................... 9
5.4. Communications........................................................................................ 9
5.5. Entire Agreement...................................................................................... 10
5.6. Benefits.............................................................................................. 10
5.7. Amendment; Waiver .................................................................................... 10
5.8. Successors and Assigns................................................................................ 10
5.9. Severability ......................................................................................... 11
5.10. Execution in Counterparts ............................................................................ 11
5.11. Governing Law......................................................................................... 11

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BROKER-DEALER AGREEMENT dated as of ______________ 1999,
between BANKERS TRUST COMPANY, a New York banking corporation (the "Auction
Agent") (not in its individual capacity, but solely as agent of Xxxxxx Strategic
Municipal Income Trust (the "Trust"), pursuant to authority granted to it in the
Auction Agency Agreement dated as of ________, 1999, between the Trust and the
Auction Agent (the "Auction Agency Agreement") and
___________________________________ (together with its successors and assigns,
"BD").

The Trust proposes to issue one series of preferred shares of
beneficial interest (2,800 shares of Series T), par value $.01 per share,
liquidation preference $25,000 per share, designated Municipal Auction Rate
Cumulative Preferred Shares (the "Municipal Preferred"), pursuant to the Trust's
Certificate of Designation for Preferred Shares (the "Certificate").

The Trust's Certificate provides that the Applicable Rate on
shares of the series of Municipal Preferred, as the case may be, for each
Dividend Period therefor after the initial Dividend Period shall be the rate per
annum that a commercial bank, trust company or other financial institution
appointed by the Trust advises results from implementation of the Auction
Procedures. The Board of Trustees of the Trust has adopted a resolution
appointing Bankers Trust Company as Auction Agent for purposes of the Auction
Procedures, and pursuant to Section 2.5 of the Auction Agency Agreement, the
Trust has requested and directed the Auction Agent to execute and deliver this
Agreement.

The Auction Procedures require the participation of one or
more Broker-Dealers.

NOW, THEREFORE, in consideration of the mutual covenants
contained herein, the Auction Agent and BD agree as follows:

I. DEFINITIONS AND RULES OF CONSTRUCTION.

1.1. Terms Defined by Reference to the Certificate.

Capitalized terms not defined herein shall have the respective meanings
specified in the Certificate.

1.2. Terms Defined Herein.

As used herein and in the Settlement Procedures, the following terms
shall have the following meanings, unless the context otherwise requires:

(a) "Auction" shall have the meaning specified in Section 3.1
hereof.

(b) "Auction Procedures" shall mean the Auction Procedures
that are set forth in Part II of the Certificate.

(c) "Authorized Officer" shall mean each Managing Director,
Vice President, Assistant Vice President, Assistant Treasurer and Assistant
Secretary of the Auction Agent and every other officer or employee of the
Auction Agent designated as an "Authorized Officer" for purposes of this
Agreement in a communication to BD.

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(d) "BD Officer" shall mean each officer or employee of BD
designated as a "BD Officer" for purposes of this Agreement in a communication
to the Auction Agent.

(e) "Broker-Dealer Agreement" shall mean this Agreement and
any substantially similar agreement between the Auction Agent and a
Broker-Dealer.

(f) "Certificate" shall mean the Certificate of Designation
for Preferred Shares of the Trust dated ___________ __, 1999 specifying the
powers, preferences and rights of the shares of Municipal Preferred.

(g) "Settlement Procedures" shall mean the Settlement
Procedures attached hereto as Exhibit A.

1.3. Rules of Construction.

Unless the context or use indicates another or different meaning or
intent, the following rules shall apply to the construction of this Agreement:

(a) Words importing the singular number shall include the
plural number and vice versa.

(b) The captions and headings herein are solely for
convenience of reference and shall not constitute a part of this Agreement, nor
shall they affect its meaning, construction or effect.

(d) All references herein to a particular time of day shall be
to New York City time.

II. NOTIFICATION OF DIVIDEND PERIOD AND ADVANCE NOTICE OF ALLOCATION
OF TAXABLE INCOME.

2.1. The provisions contained in Section 4 of Part I of the Certificate
concerning the notification of a Special Rate Period will be followed by the
Auction Agent and BD, and the provisions contained therein are incorporated
herein by reference in their entirety and shall be deemed to be a part of this
Agreement to the same extent as if such provisions were set forth fully herein.

2.2. Except as otherwise provided in Section 4 of Part I of the
Certificate, whenever the Trust intends to include any net capital gain or other
income taxable for Federal income tax purposes in any dividend on shares of
Municipal Preferred, the Trust will notify the Auction Agent of the amount to be
so included not later than the Dividend Payment Date next preceding the Auction
Date on which the Applicable Rate for such dividend is to be established.
Whenever the Auction Agent receives such notice from the Trust, it will be
required in turn to notify BD, who, on or prior to such Auction Date, will
notify its Beneficial Owners and Potential Beneficial Owners believed to be
interested in submitting an Order in the Auction to be held on such

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Auction Date. Whenever the Trust intends to include any additional amounts in a
dividend as provided in Section 3 of Part I of the Certificate, the Trust will
notify the Auction Agent of such additional amounts to be so included in such
dividend at least five Business Days prior to the applicable Dividend Payment
Date. Whenever the Auction Agent receives such notice from the Trust, in turn it
will notify the Securities Depository and BD, who, on or prior to the applicable
Dividend Payment Date, will notify its Beneficial Owners.

III. THE AUCTION.

3.1. Purpose; Incorporation by Reference of Auction Procedures and
Settlement Procedures.

(a) On each Auction Date, the provisions of the Auction
Procedures will be followed by the Auction Agent for the purpose of determining
the Applicable Rate for the Municipal Preferred, for the next Dividend Period
therefor. Each periodic operation of such procedures is hereinafter referred to
as an "Auction."

(b) All of the provisions contained in the Auction Procedures
and the Settlement Procedures are incorporated herein by reference in their
entirety and shall be deemed to be a part of this Agreement to the same extent
as if such provisions were set forth fully herein.

(c) BD agrees to act as, and assumes the obligations of and
limitations and restrictions placed upon, a Broker-Dealer under this Agreement.
BD understands that other Persons meeting the requirements specified in the
definition of "Broker-Dealer" contained in Section 1 of Part I of the
Certificate may execute a Broker-Dealer Agreement and participate as
Broker-Dealers in Auctions.

(d) BD and other Broker-Dealers may participate in Auctions
for their own accounts. However, the Trust, by notice to BD and all other Broker
Dealers, may prohibit all Broker-Dealers from submitting Bids in Auctions for
their own accounts, provided that Broker-Dealers may continue to submit Hold
Orders and Sell Orders.

3.2. Preparation for Each Auction.

(a) Not later than 9:30 A.M. on each Auction Date for the
Municipal Preferred, the Auction Agent shall advise BD by telephone of the
Reference Rate and the Maximum Rate in effect on such Auction Date.

(b) The Auction Agent from time to time may request BD to
provide it with a list of the respective customers BD believes are Beneficial
Owners of shares of Municipal Preferred. BD shall comply with any such request,
and the Auction Agent shall keep confidential any such information, including
information received as to the identity of Bidders in any Auction, and shall not
disclose any such information so provided to any Person other than the Trust;
and such information shall not be used by the Auction Agent or its officers,
employees, agents or representatives for any purpose other than such purposes as
are described herein. The Auction Agent shall transmit any list of customers BD
believes are Beneficial Owners of shares of Municipal Preferred and information
related thereto only to its officers, employees, agents or representatives who
need to know such information for the purposes of acting in accordance with

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this Agreement, and the Auction Agent shall prevent the transmission of such
information to others and shall cause its officers, employees, agents and
representatives to abide by the foregoing confidentiality restrictions;
provided, however, that the Auction Agent shall have no responsibility or
liability for the actions of any of its officers, employees, agents or
representatives after they have left the employ of the Auction Agent.

3.3. Auction Schedule; Method of Submission of Orders.

(a) The Trust and the Auction Agent shall conduct Auctions for
Municipal Preferred in accordance with the schedule set forth below. Such
schedule may be changed at any time by the Auction Agent with the consent of the
Trust, which consent shall not be withheld unreasonably. The Auction Agent shall
give notice of any such change to BD. Such notice shall be received prior to the
first Auction Date on which any such change shall be effective.

Time Event
---- -----
By 9:30 A.M. Auction Agent advises the Trust and the
Broker-Dealers of the Reference Rate and the
Maximum Rate as set forth in Section 3.2(a)
hereof.

9:30 A.M. - 1:30 P.M. Auction Agent assembles information
communicated to it by Broker-Dealers as
provided in Section 2(a) of Part II of the
Certificate. Submission Deadline is 1:00
P.M.

Not earlier than 1:30 P.M. Auction Agent makes determinations pursuant
to Section 3(a) of Part II of the
Certificate.

By approximately 3:00 P.M. Auction Agent advises the Trust of the
results of the Auction as provided in
Section 3(b) of Part II of the Certificate.

Submitted Bids and Submitted Sell Orders are
accepted and rejected in whole or in part
and shares of Municipal Preferred are
allocated as provided in Section 4 of Part
II of the Certificate.

Auction Agent gives notice of the Auction
results as set forth in Section 3.4(a)
hereof.

(b) BD agrees to maintain a list of Potential Beneficial
Owners and to contact the Potential Beneficial Owners on such list on or prior
to each Auction Date for the purposes set forth in Section 1 of Part II of the
Certificate.

(c) BD shall submit Orders to the Auction Agent in writing in
substantially the form attached hereto as Exhibit B. BD shall submit separate
Orders to the Auction Agent for each Potential Beneficial Owner or Beneficial
Owner on whose behalf BD is submitting an

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Order and shall not net or aggregate the Orders of Potential Beneficial Owners
or Beneficial Owners on whose behalf BD is submitting Orders.

(d) BD shall deliver to the Auction Agent (i) a written
notice, substantially in the form attached hereto as Exhibit C, of transfers of
shares of Municipal Preferred, made through BD by an Existing Holder to another
Person other than pursuant to an Auction, and (ii) a written notice,
substantially in the form attached hereto as Exhibit D, of the failure of shares
of Municipal Preferred to be transferred to or by any Person that purchased or
sold shares of Municipal Preferred through BD pursuant to an Auction. The
Auction Agent is not required to accept any notice delivered pursuant to the
terms of the foregoing sentence with respect to an Auction unless it is received
by the Auction Agent by 3:00 P.M. on the Business Day next succeeding the
applicable Auction Date.

3.4. Notice of Auction Results.

(a) On each Auction Date, the Auction Agent shall notify BD by
telephone as set forth in paragraph (a) of the Settlement Procedures. On the
Business Day next succeeding such Auction Date, the Auction Agent shall notify
BD in writing of the disposition of all Orders submitted by BD in the Auction
held on such Auction Date.

(b) BD shall notify each Beneficial Owner, Potential
Beneficial Owner, Existing Holder or Potential Holder on whose behalf BD has
submitted an Order as set forth in paragraph (b) of the Settlement Procedures,
and take such other action as is required of BD pursuant to the Settlement
Procedures.

If any Beneficial Owner or Existing Holder selling shares of
Municipal Preferred in an Auction fails to deliver such shares, the BD of any
Person that was to have purchased shares of Municipal Preferred in such Auction
may deliver to such Person a number of whole shares of Municipal Preferred that
is less than the number of shares that otherwise was to be purchased by such
Person. In such event, the number of shares of Municipal Preferred to be so
delivered shall be determined by such BD. Delivery of such lesser number of
shares shall constitute good delivery. Upon the occurrence of any such failure
to deliver shares, such BD shall deliver to the Auction Agent the notice
required by Section 3.3(d)(ii) hereof. Notwithstanding the foregoing terms of
this Section 3.4(b), any delivery or non-delivery of shares of Municipal
Preferred which represents any departure from the results of an Auction, as
determined by the Auction Agent, shall be of no effect unless and until the
Auction Agent shall have been notified of such delivery or non-delivery in
accordance with the terms of Section 3.3(d) hereof. The Auction Agent shall have
no duty or liability with respect to enforcement of this Section 3.4(b).

3.5. Service Charge to Be Paid to BD.

On the Business Day next succeeding each Auction Date, the
Auction Agent shall pay to BD from moneys received from the Trust an amount
equal to: (a) in the case of any Auction Date immediately preceding a Dividend
Period of 7 days or less, the product of (i) a fraction the numerator of which
is the number of days in such Dividend Period (calculated by counting the first
day of such Dividend Period but excluding the last day thereof) and the

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denominator of which is 360, times (ii) 1/4 of 1%, times (iii) $25,000, times
(iv) the sum of (A) the aggregate number of Municipal Preferred placed by BD in
the applicable Auction that were (x) the subject of a Submitted Bid of a
Beneficial Owner submitted by BD and continued to be held as a result of such
submission and (y) the subject of a Submitted Bid of a Potential Beneficial
Owner submitted by BD and were purchased as a result of such submission plus (B)
the aggregate number of Municipal Preferred subject to valid Hold Orders
(determined in accordance with Section 2 of Part II of the Certificate)
submitted to the Auction Agent by BD plus (C) the number of Municipal Preferred
deemed to be subject to Hold Orders by Beneficial Owners pursuant to Section 2
of Part II of the Certificate that were acquired by such Beneficial Owners
through BD; and (b) in the case of any Auction Date immediately preceding a
Special Rate Period, that amount as mutually agreed upon by the Trust and BD,
based on the selling concession that would be applicable to an underwriting of
fixed or variable rate preferred shares with a similar final maturity or
variable rate dividend period, at the commencement of such Special Rate Period.

For purposes of subclause (a)(iv)(C) of the foregoing
sentence, if any Beneficial Owner who acquired shares of Municipal Preferred
through BD transfers those shares to another Person other than pursuant to an
Auction, then the Broker-Dealer for the shares so transferred shall continue to
be BD, provided, however, that if the transfer was effected by, or if the
transferee is, a Broker-Dealer other than BD, then such Broker-Dealer shall be
the Broker-Dealer for such shares.

IV. THE AUCTION AGENT.

4.1. Duties and Responsibilities.

(a) The Auction Agent is acting solely as agent for the Trust
hereunder and owes no fiduciary duties to any other Person by reason of this
Agreement.

(b) The Auction Agent undertakes to perform such duties and
only such duties as are set forth specifically in this Agreement, and no implied
covenants or obligations shall be read into this Agreement against the Auction
Agent.

(c) In the absence of bad faith or negligence on its part, the
Auction Agent shall not be liable for any action taken, suffered or, omitted by
it, or for any error of judgment made by it in the performance of its duties
under this Agreement. The Auction Agent shall not be liable for any error of
judgment made in good faith unless the Auction Agent shall have been negligent
in ascertaining (or failing to ascertain) the pertinent facts.

4.2. Rights of the Auction Agent.

(a) The Auction Agent may rely upon, and shall be protected in
acting or refraining from acting upon, any communication authorized by this
Agreement and any written instruction, notice, request, direction, consent,
report, certificate, share certificate or other instrument, paper or document
believed by it to be genuine. The Auction Agent shall not be liable for acting
upon any telephone communication authorized by this Agreement which the Auction
Agent believes in good faith to have been given by the Trust or by BD. The
Auction Agent may record telephone communications with BD.

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(b) The Auction Agent may consult with counsel of its own
choice, and the advice of such counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon.

(c) The Auction Agent shall not be required to advance, expend
or risk its own funds or otherwise incur or become exposed to financial
liability in the performance of its duties hereunder.

(d) The Auction Agent may perform its duties and exercise its
rights hereunder either directly or by or through agents or attorneys.

4.3. Auction Agent's Disclaimer.

The Auction Agent makes no representation as to the validity or
adequacy of this Agreement or the Municipal Preferred.

V. MISCELLANEOUS.

5.1. Termination.

Any party may terminate this Agreement at any time upon five days'
prior written notice to the other party; provided, however, that if BD is
Xxxxxxx Xxxxx Xxxxxx Inc. neither BD nor the Auction Agent may terminate this
Agreement without first obtaining the prior written consent of the Trust to such
termination, which consent shall not be withheld unreasonably.

5.2. Participant in Securities Depository; Payment of Dividends in
Same-Day Funds.

(a) BD is, and shall remain for the term of this Agreement, a
member of, or a participant in, the Securities Depository (or an affiliate of
such a member or participant).

(b) BD represents that it (or if BD does not act as Agent
Member, one of its affiliates) shall make all dividend payments on the Municipal
Preferred available in same-day funds on each Dividend Payment Date to customers
that use BD (or its affiliate) as Agent Member.

5.3. Agent Member.

At the date hereof, BD is a participant of the Securities Depository.

5.4. Communications.

Except for (i) communications authorized to be made by telephone
pursuant to this Agreement or the Auction Procedures and (ii) communications in
connection with the Auctions (other than those expressly required to be in
writing), all notices, requests and other communications to any party hereunder
shall be in writing (including telecopy or similar writing) and shall be given
to such party at its address or telecopier number set forth below:

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If to the Auction
Agent, addressed to: Bankers Trust Company
Corporate Trust and Agency Group
Four Xxxxxx Xxxxxx
Xxx, Xxxx, XX 00000

Attention: Auction Rate Securities
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000

or such other address or telecopier number as such party hereafter may specify
for such purpose by notice to the other party. Each such notice, request or
communication shall be effective when delivered at the address specified herein.
Communications shall be given on behalf of BD by a BD Officer and on behalf of
the Auction Agent by an Authorized Officer. BD may record telephone
communications with the Auction Agent.

5.5. Entire Agreement.

This Agreement contains the entire agreement between the parties
relating to the subject matter hereof, and there are no other representations,
endorsements, promises, agreements or understandings, oral, written or inferred,
between the parties relating to the subject matter hereof.

5.6. Benefits.

Nothing in this Agreement, express or implied, shall give to any
person, other than the Trust, the Auction Agent and BD and their respective
successors and assigns, any benefit of any legal or equitable right, remedy or
claim under this Agreement.

5.7. Amendment; Waiver.

(a) This Agreement shall not be deemed or construed to be
modified, amended, rescinded, canceled or waived, in whole or in part, except by
a written instrument signed by a duly authorized representative of the party to
be charged.

(b) Failure of either party to this Agreement to exercise any
right or remedy hereunder in the event of a breach of this Agreement by the
other party shall not constitute a waiver of any such right or remedy with
respect to any subsequent breach.

5.8. Successors and Assigns.

This Agreement shall be binding upon, inure to the benefit of, and be
enforceable by, the respective successors and permitted assigns of each of BD
and the Auction Agent. This Agreement may not be assigned by either party hereto
absent the prior written consent of the other party; provided, however, that
this Agreement may be assigned by the Auction Agent to a successor Auction Agent
selected by the Trust without the consent of BD.

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5.9. Severability.

If any clause, provision or section of this Agreement shall be ruled
invalid or unenforceable by any court of competent jurisdiction, the invalidity
or unenforceability of such clause, provision or section shall not affect any
remaining clause, provision or section hereof.

5.10. Execution in Counterparts.

This Agreement may be executed in several counterparts, each of which
shall be an original and all of which shall constitute but one and the same
instrument.

5.11. Governing Law.

This Agreement shall be governed by and construed in accordance with
the laws of the State of New York applicable to agreements made and to be
performed in said state.

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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their proper and duly authorized
officers as of the date first above written.

BANKERS TRUST COMPANY

By:_______________________________
Title:

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EXHIBIT A

SETTLEMENT PROCEDURES

[Included as Appendix C to the Statement of Additional Information of the Trust]

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EXHIBIT B

BANKERS TRUST COMPANY
AUCTION BID FORM

Submit To: Issue:
Bankers Trust Company Xxxxxx Strategic Municipal Income Trust
Corporate Trust and Agency Group Municipal Auction Rate Cumulative
Shares ("Municipal Preferred") Preferred Four Xxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Auction Rate Securities
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000

The undersigned Broker-Dealer submits the following Order on behalf of the
Bidder listed below:

Name of Bidder:___________________________

BENEFICIAL OWNER

Shares of Series T now held _______________ HOLD_________________________
BID at rate of_______________
SELL_________________________

POTENTIAL BENEFICIAL OWNER

# of shares of Series T bid____
BID at rate of _________________ Notes:

(1) If submitting more than one Bid for one Bidder, use additional
Auction Bid Forms.

(2) If one or more Bids covering in the aggregate more than the number
of outstanding shares held by any Beneficial Owner are submitted, such bid shall
be considered valid in the order of priority set forth in the Auction Procedures
on the above issue.

(3) A Hold or Sell Order may be placed only by a Beneficial Owner
covering a number of shares not greater than the number of shares currently
held.

(4) Potential Beneficial Owners may make only Bids, each of which must
specify a rate. If more than one Bid is submitted on behalf of any Potential
Beneficial Owner, each Bid submitted shall be a separate Bid with the rate
specified.

(5) Bids may contain no more than three figures to the right of the
decimal point (.001 of 1%). Fractions will not be accepted.

NAME OF BROKER-DEALER__________________________

Authorized Signature___________________________

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EXHIBIT C

(Note: To be used only for transfers made
other than pursuant to an Auction)

TRANSFER FORM

Re: Xxxxxx Strategic Municipal Income Trust
Municipal Auction Rate Cumulative Preferred Shares
("Municipal Preferred")

We are (check one):

[ ] the Existing Holder named below;

[ ] the Broker-Dealer for such Existing Holder; or

[ ] the Agent Member for such Existing Holder.

We hereby notify you that such Beneficial Owner has
transferred shares of Series T Municipal Preferred to
____________________________________.

_____________________________________
(Name of Existing Holder)

_____________________________________
(Name of Broker-Dealer)

_____________________________________
(Name of Agent Member)

By:___________________
Printed Name:
Title:
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EXHIBIT D

(Note: To be used only for failures to deliver or to pay for
Municipal Preferred sold pursuant to an Auction)

NOTICE OF A FAILURE TO DELIVER

Complete either I or II.

I. We are a Broker-Dealer for ___________________ (the
"Purchaser"), which purchased ________ shares of Series T Municipal Preferred of
Xxxxxx Strategic Municipal Income Trust in the Auction held on
____________________ from the seller of such shares.

We hereby notify you that (check one):

__________ the Seller failed to deliver such shares to the
Purchaser.

__________ the Purchaser failed to make payment to the Seller
upon delivery of such shares.

Name:______________________________
(Name of Broker-Dealer)

By:________________________________
Printed Name:
Title:

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