EXHIBIT 1.1
XXX XXXXXX UNIT TRUSTS, MUNICIPAL SERIES 616
TRUST AGREEMENT
Dated: August 10, 2006
This Trust Agreement among Xxx Xxxxxx Funds Inc., as Depositor, The
Bank of New York, as Trustee, Standard & Poor's Securities Evaluations, Inc., as
Evaluator, and Xxx Xxxxxx Asset Management, as Supervisor, sets forth certain
provisions in full and incorporates other provisions by reference to the
document entitled "Standard Terms and Conditions of Trust For Xxx Xxxxxx Focus
Portfolios Municipal Series, Effective for Unit Investment Trusts Established On
and After May 3, 2001 (Including Xxx Xxxxxx Focus Portfolios, Municipal Series
347 and Subsequent Series)" (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, Trustee, Evaluator and Supervisor 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 full in this instrument.
PART II
SPECIAL TERMS AND CONDITIONS OF TRUST
The following special terms and conditions are hereby agreed to:
1. The Bonds listed in the Schedules hereto have been deposited in trust
under this Trust Agreement.
2. The fractional undivided interest in and ownership of a Trust represented
by each Unit thereof is a fractional amount, the numerator of which is one and
the denominator of which is the amount set forth under "Summary of Essential
Financial Information-General Information_Number of Units" in the Prospectus
Part I for such Trust.
3. The aggregate number of Units described in Section 2.03(a) for a Trust is
that number of Units set forth under "Summary of Essential Financial
Information--General Information--Number of Units" in the Prospectus Part I for
such Trust.
4. The term "First Settlement Date" shall mean the date set forth in footnote
2 under "Summary of Essential Financial Information" in the Prospectus Part I
for a Trust.
5. The term "Monthly Distribution Date" shall mean the "Distribution Dates"
set forth under "Summary of Essential Financial Information--Estimated
Distributions--Monthly Distributions" in the Prospectus Part I for a Trust.
6. The term "Monthly Record Date" shall mean the "Record Dates" set forth
under "Summary of Essential Financial Information--Estimated
Distributions--Monthly Distributions" in the Prospectus Part I for a Trust.
7. The term "Semi-Annual Distribution Date" shall mean the "Distribution
Dates" set forth under "Summary of Essential Financial Information--Estimated
Distributions--Semi-Annual Distributions" in the Prospectus Part I for a Trust.
8. The term "Semi-Annual Record Date" shall mean the "Record Dates" set forth
under "Summary of Essential Financial Information--Estimated
Distributions--Semi-Annual Distributions" in the Prospectus Part I for a Trust.
9. The Trustee's annual compensation as set forth under Section 7.04, for
each distribution plan shall be that amount set forth under the section entitled
"Summary of Essential Financial Information--Expenses--Trustee's Fee" in the
Prospectus Part I for a Trust.
10. With respect to an Investment Grade Municipal Trust and a California
Investment Grade Trust only, Section 3.14(a) and (b) shall be replaced in their
entirety with the following:
"(a) The Replacement Bonds (i) shall be bonds issued by states
or territories of the United States or political subdivisions thereof
which shall have the benefit of an exemption from United States federal
taxation of interest to an extent equal to or greater than that of the
Bonds they replace and, in the case of a State Trust, shall have the
benefit of an exemption from state taxation to an extent equal to or
greater than that of the Bonds they replace, (ii) shall have a fixed
maturity date (whether or not entitled to the benefits of any sinking,
redemption, purchase or similar fund) within the maturity range, if
any, specified in the Prospectus for the Trust, (iii) must be purchased
at a price that results in a current return as of the Date of Deposit
at least equal to that of the Failed Contract Bonds they replace, (iv)
must be purchased at a price that results in a yield to maturity of the
Date of Deposit at least equal to that of the Failed Contract Bonds
they replace and (v) shall be payable as to principal and interest in
United States currency.
(b) Each Replacement Bond shall have a rating by Standard &
Poor's, a division of The XxXxxx-Xxxx Companies, Inc. or Xxxxx'x
Investors Service, Inc. at least equal to the minimum rating specified
in the Prospectus for inclusion in the related Trust on the Date of
Deposit or be comparably rated by any other nationally recognized
credit rating service rating debt obligations which shall be designated
by the Depositor and shall be satisfactory to the Trustee."
11. The term "Evaluator" shall mean Standard & Poor's Securities Evaluations,
Inc. and its successors in interest, or any successor evaluator appointed as
provided in the Standard Terms and Conditions of Trust.
12. The term "Supervisor" shall mean Xxx Xxxxxx Asset Management and its
successors in interest or any successor supervisor appointed as provided in the
Standard Terms and Conditions of Trust.
13. The following shall be added to Section 3.07 of the Standard Terms and
Conditions of Trust immediately following Section 3.07(h):
"(i) if the Trust has elected to be taxed as a "regulated investment
company" as defined in the United States Internal Revenue Code of 1986, as
amended, that such sale is necessary or advisable (a) to maintain the
qualification of the Trust as a regulated investment company or (b) to provide
funds to make any distribution for a taxable year in order to avoid imposition
of any income or excise taxes on the Trust or on undistributed income in the
Trust.
In the event a Security is sold pursuant to any provisions of this
Section 3.07 as a direct result of serious adverse credit factors affecting the
issuer of such Security and the Trust has elected to be taxed as a "regulated
investment company" as defined in the United States Internal Revenue Code of
1986, as amended, then the Depositor may, but is not obligated, to direct the
reinvestment of the proceeds of the sale of such Security in any other
securities which meet the criteria necessary for inclusion in such Trust on the
Initial Date of Deposit."
14. The paragraph immediately following Section 3.14(e) of the Standard Terms
and Conditions of Trust shall be replaced in its entirety with the following:
"Notwithstanding anything to the contrary in this Section 3.14, no
substitution of Replacement Bonds will be made if such substitution will
adversely affect the federal income tax status of the related Trust."
15. The Standard Terms and Conditions of Trust shall be amended to include
the following section:
"Section 3.18. Regulated Investment Company Election. If the Prospectus
for a Trust states that such Trust intends to elect to be treated and to qualify
as a "regulated investment company" as defined in the United States Internal
Revenue Code of 1986, as amended, the Trustee is hereby directed to make such
elections and take all actions, including any appropriate election to be taxed
as a corporation, as shall be necessary to effect such qualification."
16. Section 9.01 of the Standard Terms and Conditions of Trust shall be
replaced in its entirety with the following:
"Section 9.01. Amendments. (a) This Indenture may be amended from time to
time by the Depositor and Trustee hereto or their respective successors, without
the consent of any of the Unitholders (i) to cure any ambiguity or to correct or
supplement any provision contained herein which may be defective or inconsistent
with any other provision contained herein, (ii) to make such other provision
regarding matters or questions arising hereunder as shall not adversely affect
the interests of the Unitholders or (iii) to make such amendments as may be
necessary (a) for the Trust to continue to qualify as a regulated investment
company for federal income tax purposes if the Trust has elected to be taxed as
such under the United States Internal Revenue Code of 1986, as amended, or (b)
to prevent the Trust from being deemed an association taxable as a corporation
for federal income tax purposes if the Trust has not elected to be taxed as a
regulated investment company under the United States Internal Revenue Code of
1986, as amended. This Indenture may not be amended, however, without the
consent of all Unitholders then outstanding, so as (1) to permit, except in
accordance with the terms and conditions hereof, the acquisition hereunder of
any Securities other than those specified in the Schedules to the Trust
Agreement or (2) to reduce the aforesaid percentage of Units the holders of
which are required to consent to certain of such amendments. This Indenture may
not be amended so as to reduce the interest in a Trust represented by Units
(whether evidenced by Certificates or held in uncertificated form) without the
consent of all affected Unitholders.
(b) Except for the amendments, changes or modification as provided in
Section 9.01(a) hereof, neither the parties hereto nor their respective
successors shall consent to any other amendment, change or modification of this
Indenture without the giving of notice and the obtaining of the approval or
consent of Unitholders representing at least 51% of the Units then outstanding
of the affected Trust. Nothing contained in this Section 9.01(b) shall permit,
or be construed as permitting, a reduction of the aggregate percentage of Units
the holders of which are required to consent to any amendment, change or
modification of this Indenture without the consent of the Unitholders of all of
the Units then outstanding of the affected Trust and 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 tax status of the Trust for federal income tax
purposes.
(c) Promptly after the execution of any such amendment the Trustee
shall furnish written notification to all then outstanding Unitholders of the
substance of such amendment."
IN WITNESS WHEREOF, the undersigned have caused this Trust Agreement to
be executed; all as of the day, month and year first above written.
XXX XXXXXX FUNDS INC.
By /s/ XXXX X. XXXXXXX
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Executive Director
XXX XXXXXX ASSET MANAGEMENT
By /s/ XXXX X. XXXXXXX
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Executive Director
STANDARD & POOR'S SECURITIES EVALUATIONS, INC.
By /s/ XXXXX X. XXXXXX
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Vice President
THE BANK OF NEW YORK
By /s/ XXXXXXX XXXXXXXX
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Vice President
SCHEDULE A TO TRUST AGREEMENT
SECURITIES INITIALLY DEPOSITED
IN
XXX XXXXXX UNIT TRUSTS, MUNICIPAL SERIES 616
[Incorporated herein by this reference and made a part hereof is the
"Portfolio" schedule as set forth in the Prospectus Part I for each Trust.]
