EXHIBIT 1.1
ADVISORS DISCIPLINED TRUST 1823
TRUST AGREEMENT
Dated: October 11, 2017
This Trust Agreement among Advisors Asset Management, Inc., as Depositor,
Evaluator and Supervisor, and The Bank of New York Mellon, 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 Advisors
Disciplined Trust, Effective for Unit Investment Trusts Investing in Equity
Securities Established On and After May 1, 2016" (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 Securities 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 "Understanding
Your Investment--Statement of Financial Condition_Number of Units" in the
Prospectus for the Trust.
3. The aggregate number of Units described in Section 2.03(a) for a Trust
is that number of Units set forth under "Understanding Your Investment--
Statement of Financial Condition--Number of Units" in the Prospectus for the
Trust.
4. The term "Deferred Sales Charge Payment Dates" for a Trust shall mean
the dates specified for deferred sales fee installments under "Investment
Summary--Fees and Expenses" in the Prospectus for the Trust.
5. The term "Distribution Date" for a Trust shall mean the "Distribution
dates" set forth under "Investment Summary--Essential Information" in the
Prospectus for the Trust.
6. The term "First Settlement Date" shall mean the third Business Day
following the Initial Date of Deposit.
7. The term "Mandatory Termination Date" for a Trust shall mean the
"Termination Date" set forth under "Investment Summary--Essential Information"
in the Prospectus for the Trust.
8. The term "Record Date" for a Trust shall mean the "Record dates" set
forth under "Investment Summary--Essential Information" in the Prospectus for
the Trust.
9. For purposes of the definition of the term "Income Distribution",
Section 3.05(b)(ii)(A) shall apply.
10. The Depositor's annual compensation as set forth under Section 3.13
shall be that dollar amount per 100 Units set forth under "Investment Summary--
Fees and Expenses--Annual operating expenses--Supervisory, evaluation and
administration fees" in the Prospectus for the Trust.
11. The Trustee's annual compensation as set forth under Section 7.04 shall
be $0.0105 per Unit.
12. Section 1.01(42) is replaced in its entirety with the following:
"'Percentage Ratio' shall mean with respect to a Trust, the percentage
relationship among the Securities based on the number of contracts of each
Option per Unit, the principal amount of each Bond per Unit and the number of
shares of each Equity Security per Unit compared to all Securities attributable
to each Unit existing immediately prior to the related additional deposit of
Securities. The Percentage Ratio shall be adjusted to the extent necessary, and
may be rounded, to reflect the occurrence of a stock dividend, a stock split or
a similar event which affects the capital structure of the issuer of a
Security."
13. Section 1.01(52) of the Standard Terms and Conditions of Trust is
replaced in its entirety with the following:
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"'Securities' shall mean the Bonds, Equity Securities and Options,
including Contract Securities, delivery statements relating to "when-issued"
and/or "regular way" contracts, if any, for the purchase of certain Securities
and certified bank check or checks or Letter of Credit or Letters of Credit
sufficient in amount or availability required for such purchase, deposited in
irrevocable trust and listed in the schedule(s) to the Trust Agreement or which
are deposited in or purchased on behalf of a Trust pursuant to Section 2.01(b)
hereof or as otherwise permitted hereby, and any securities received in
exchange, substitution or replacement for such securities, as may from time to
time continue to be held as part of the Trusts.
14. Section 1.01 of the Standard Terms and Conditions of Trust is amended by
adding the following subsection immediately after Section 1.01(65):
"(66) 'Options' shall mean any put, call, straddle, option or privilege
on a security or other asset, or on a group or index of securities or other
assets, including Contract Securities, deposited in irrevocable trust and listed
in the schedule(s) to the Trust Agreement or which are deposited in or purchased
on behalf of a Trust pursuant to Section 2.01(b) or as otherwise permitted
hereby, and any securities received in addition to, or in exchange, substitution
or replacement for, such securities, as may from time to time continue to be
held as a part of the Trust).
(67) 'Bonds' shall mean debt obligations, including Contract Securities and
delivery statements relating to `when issued' and/or `regular way' contracts, if
any, for the purchase of certain bonds, deposited in irrevocable trust and
listed in the schedule(s) to the Trust Agreement or which are deposited in or
purchased on behalf of a Trust pursuant to Section 2.01(b) or as otherwise
permitted hereby, and any obligations received in addition to, or in exchange,
substitution or replacement for, such obligations, as may from time to time
continue to be held as part of the Trust.
(68) 'Equity Securities' shall mean any equity securities of corporations
or other entities, including Contract Securities, deposited in irrevocable trust
and listed in the schedule(s) to the Trust Agreement or which are deposited in
or purchased on behalf of a Trust pursuant to Section 2.01(b) or as otherwise
permitted hereby, and any securities received in addition to, or in exchange,
substitution or replacement for, such securities, as may from time to time
continue to be held as a part of the Trust."
15. Section 2.01(a) of the Standard Terms and Conditions of Trust is
replaced in its entirety with the following:
"(a) The Depositor, on the date of the Trust Agreement, has deposited with
the Trustee in trust the Securities listed in the schedule(s) attached to the
Trust Agreement in bearer form or 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. The Depositor shall
deliver to the Trustee the Securities listed on said schedule(s) to the Trust
Agreement which were represented by Contract Securities within ninety (90)
calendar days after the date of the Trust Agreement (the "Delivery Period"). If
a contract for such Contract Securities is terminated a party thereto for any
reason beyond the control of the Depositor or if
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for any other reason the Securities to be delivered pursuant to such contract
are not delivered to the Trust by the end of the Delivery Period, the Trustee
shall immediately draw on the Letter of Credit, if any, in its entirety, apply
the moneys in accordance with Section 2.01(d), and the Depositor shall forthwith
take the remedial action specified in Section 3.12. In the event that the
Trustee draws on the Letter of Credit, the Trustee shall provide the Depositor
with notice upon the withdrawal. If the Depositor does not take the action
specified in Section 3.12 within ninety (90) calendar days of the end of the
Delivery Period, the Trustee shall forthwith take the action specified in
Section 3.12."
16. Section 3.02 of the Standard Terms and Conditions of Trust is replaced
in its entirety with the following:
"Section 3.02. Income Account. The Trustee shall collect the dividends,
interest or other like cash distributions on the Securities in each Trust as
such becomes payable (including all moneys representing penalties for the
failure to make timely payments on the Securities, or as liquidated damages for
default or breach of any condition or term of the Securities or of the
underlying instrument relating to any Securities and other income attributable
to a Failed Contract Security for which no Replacement Security has been
obtained pursuant to Section 3.12 hereof and interest accrued but unpaid prior
to the date of deposit of the Securities) in trust and including that part of
the proceeds of the sale, liquidation, redemption, prepayment or maturity of any
Bonds or insurance payments thereon which represent interest thereon and credit
such income to a separate account for each Trust to be known as the "Income
Account."Any distributions received by the Trustee in a form other than cash
(other than a non-taxable distribution of the shares of the distributing entity,
which shall be returned by the Trust) shall be dealt with in the manner
described in Section 3.11 and shall be retained or disposed of by a Trust
according to those provisions. The proceeds of sale credited to the Income
Account of the Trust. The Trustee shall not be liable or responsible in any way
for depreciation or loss incurred by reason of any such sale."
17. Section 3.05(a) of the Standard Terms and Conditions of Trust is
replaced in its entirety with the following:
"(a) The Trustee, as of the First Settlement Date, shall advance from its
own funds and shall pay to the Unitholders of each Trust then of record the
amount of interest accrued on the Bonds deposited in such Trust. The Trustee
shall be entitled to reimbursement for such advancement from interest received
by the respective Trust before any further distributions shall be made from the
Income Account to Unitholders of the Trust. The Trustee shall also advance from
its own funds and pay the appropriate persons the amount of any interest which
accrues on any "when, as and if issued" or "delayed delivery" Bonds deposited in
a Trust from the First Settlement Date to the respective dates of delivery to
the Trust of any such Bonds. Subsequent distributions shall be made as
hereinafter provided. Subsequent distributions of funds from the Income Account
of a Trust shall be made on the applicable Record Dates of a Trust as described
herein. On or immediately after each Record Date, the Trustee shall satisfy
itself as to the adequacy of the Reserve Account, making any further credits
thereto as may appear appropriate in accordance with Section 3.04 and shall then
with respect to each Trust:
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(i) deduct from the Income Account or, to the extent funds are not
available in such Account, from the Capital Account and pay to itself
individually the amounts that it is at the time entitled to receive
pursuant to Section 7.04;
(ii) deduct from the Income Account of the Trust, and, to the extent
funds are not sufficient therein, from the Capital Account of the Trust,
amounts necessary to pay any unpaid expenses of the Trust, including
registration charges, state blue sky fees, printing costs, attorneys' fees,
auditing costs and other miscellaneous out-of-pocket expenses, as certified
by the Depositor, incurred in keeping the registration of the Units and the
Trust on a current basis pursuant to Section 9.05;
(iii) deduct from the Income Account or, to the extent funds are not
available in such Account, from the Capital Account and pay to, or reserve
for, the Depositor, Supervisor and Evaluator, as applicable, the amount
that it is entitled to receive pursuant to Section 3.13;
(iv) deduct from the Income Account or, to the extent funds are not
available in such Account, from the Capital Account and pay to counsel, as
hereinafter provided for, an amount equal to unpaid fees and expenses, if
any, of such counsel pursuant to Section 3.08, as certified to by the
Depositor; and
(v) Notwithstanding any of the previous provisions, if a Trust is a
RIC, the Trustee is directed to make any distribution or take any action
necessary in order to maintain the qualification of the Trust as a
regulated investment company for federal income tax purposes or 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."
18. The first paragraph of section 3.06 of the Standard Terms and Conditions
of Trust shall be replaced in its entirety with the following:
"With each distribution from the Income or Capital Accounts of a Trust the
Trustee shall set forth, either in the instrument by means of which payment of
such distribution is made or in an accompanying statement, the amount being
distributed from each such Account and, if from the Income Account, the amount
of accrued interest (uncollected and not available for distribution) on the
Monthly Record Date for such distribution, each expressed as a dollar amount per
Unit."
19. Section 3.06(A)(1) of the Standard Terms and Conditions of Trust shall
be replaced in its entirety with the following:
"(1) the amount of income received on the Securities including amounts
received as a portion of the proceeds of any disposition of Securities and
accreted original discount on the Bonds;"
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20. Section 3.07 of the Standard Terms and Conditions of Trust shall be
replaced in its entirety with the following:
"Section 3.07. Sale of Securities. (a) If necessary, in order to maintain
the sound investment character of a Trust, the Depositor may direct the Trustee
to sell, liquidate or otherwise dispose of Securities in such Trust at such
price and time and in such manner as shall be determined by the Depositor,
provided that the Supervisor has determined, if appropriate, that any one or
more of the following conditions exist with respect to such Securities:
(i) that there has been a default on any of the Securities in the
payment of dividends, interest, principal or other payments, after declared
and when due and payable;
(ii) that any action or proceeding has been instituted at law or
equity seeking to restrain or enjoin the payment of dividends, interest,
principal or other payments on Securities after declared and when due and
payable, or that there exists any legal question or impediment affecting
such Securities or the payment of dividends, interest, principal or other
payments from the same;
(iii) that there has occurred any breach of covenant or warranty in any
document relating to the issuer of the Securities which would adversely
affect either immediately or contingently the payment of dividends,
interest, principal or other payments after declared and when due and
payable from the Securities, or the general credit standing of the issuer
or otherwise impair the sound investment character of such Securities;
(iv) that there has been a default in the payment of dividends,
interest, principal, income, premium or other similar payments, if any, on
any other outstanding obligations of the issuer or guarantor of such
Securities;
(v) that the price of the Security has declined to such an extent or
other such credit factors exist so that in the opinion of the Supervisor,
as evidenced in writing to the Trustee, the retention of such Securities
would be detrimental to the Trust and to the interest of the Unitholders;
(vi) that all of the Securities in the Trust will be sold pursuant to
termination of the Trust pursuant to Section 9.02;
(vii) that such sale is required due to Units tendered for redemption;
(viii) that there has been a public tender offer made for a Security or
a merger or acquisition is announced affecting a Security, and that in the
opinion of the Supervisor the sale or tender of the Security is in the best
interest of the Unitholders;
(ix) with respect to an Index Trust, that the Security has been
removed from the Trust's Target Index;
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(x) with respect to an Index Trust, that the Security is over-
represented in the Trust's portfolio in comparison to such Security's
weighting in the Trust's Target Index;
(xi) if the Trust is a Grantor Trust, that the sale of such Securities
is required in order to prevent the Trust from being deemed an association
taxable as a corporation for federal income tax purposes;
(xii) if the Trust is a RIC, that such sale is necessary or advisable
(A) to maintain the qualification of the Trust as a "regulated investment
company" for federal income tax purposes 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;
(xiii) that as result of the ownership of the Security, the Trust or its
Unitholders would be a direct or indirect shareholder of a passive foreign
investment company as defined in section 1297 (a) of the Code;
(xiv) that such sale is necessary for the Trust to comply with such
federal and/or state securities laws, regulations and/or regulatory actions
and interpretations which may be in effect from time to time;
(xv) that any action or proceeding has been instituted in law or
equity seeking to restrain or enjoin the payment of principal or interest
on any Bonds, attacking the constitutionality of any enabling legislation
or alleging and seeking to have judicially determined the illegality of the
issuing body or the constitution of its governing body or officers, 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
any 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 Securities or the
payment of debt service on the same;
(xvi) that any Bonds are the subject of an advanced refunding. For the
purposes of this Section 3.07(a)(xvi), "an advanced refunding" shall mean
when refunding bonds are issued and the proceeds thereof are deposited in
an irrevocable trust to retire the Bonds on or before their redemption
date; or
(xvii) that as of any Record Date any of the Bonds are scheduled to be
redeemed and paid prior to the next succeeding Distribution Date; provided,
however, that as the result of such redemption the Trustee will receive
funds in an amount sufficient to enable the Trustee to include in the next
distribution from the Capital Account at least $1.00 per 100 Units;
(b) In the event a Security is sold pursuant to Section 3.07(a)(v) as a
direct result of serious adverse credit factors affecting the issuer of such
Security and the Trust is a RIC, then the Depositor may, if permitted by
applicable law, but is not obligated, to direct the reinvestment of
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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.
(c) In the event a Security is sold pursuant to Section 3.07(a)(ix) and the
Trust is a RIC, the Depositor may direct the reinvestment of the proceeds of the
sale of such Security, to the extent practicable, into any security which
replaces such Security as a component of the Trust's Target Index or, if no
security so replaces such Security, into any other Securities which are under-
represented in the Trust's portfolio in comparison to their weighting in the
Trust's Target Index. In the event a Security is sold pursuant to Section
3.07(a)(x) and the Trust is a RIC, the Depositor may direct the reinvestment of
the proceeds of the sale of such Security, to the extent practicable, into any
other Securities which are under-represented in the Trust's portfolio in
comparison to their weighting in the Trust's Target Index. Without limiting the
generality of the foregoing, in determining whether such reinvestment is
practicable, the Depositor may, but is not obligated to, specifically consider
the ability of the Trust to reinvest such proceeds into round lots of a
Security.
(d) Upon receipt of such direction from the Depositor to dispose of
Securities as described in this Section 3.07 upon which the Trustee shall rely,
the Trustee shall proceed to sell or liquidate the specified Securities in
accordance with such direction, and upon the receipt of the proceeds of any such
sale or liquidation, after deducting therefrom any fees and expenses of the
Trustee connected with such sale or liquidation and any brokerage charges, taxes
or other governmental charges shall deposit such net proceeds in the applicable
Capital Account; provided, however, that the Trustee shall not liquidate or sell
any Bonds upon receipt of a direction from the Depositor pursuant to Section
3.07(a)(xvii), unless the Trustee shall receive on account of such sale or
liquidation the full principal amount of such Bonds, plus the premium, if any,
and the interest accrued and to accrue thereon to the date of the redemption of
such Bonds.
(e) 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 or liquidate any Securities under this Section 3.07.
(f) If Options have been written with respect to Equity Securities, such
Equity Securities cannot be sold or liquidated without also closing out the
related Options positions."
21. Section 3.09 of the Standard Terms and Conditions of Trust shall be
replaced in its entirety with the following:
"Notice and Sale by Trustee. If at any time dividends, interest, principal
or other payments, after declared and when due and payable on any of the
Securities shall not have been paid within thirty days, the Trustee shall notify
the Depositor thereof. If within thirty (30) days after such notification the
Depositor has not given any instruction to sell or to hold or has not taken any
other action in connection with such Securities, the Trustee may in its
discretion sell such Securities forthwith, and the Trustee shall not be liable
or responsible in any way for depreciation or loss incurred by reason of such
sale."
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22. Section 3.10(d)(i) is replaced in its entirety with the following:
"(i) The Depositor may resign and be discharged hereunder, by executing an
instrument in writing resigning as Depositor and filing the same with the
Trustee, not less than sixty (60) days before the date specified in such
instrument when such resignation is to take effect. Upon effective resignation
hereunder, the resigning Depositor shall be discharged and shall no longer be
liable in any manner hereunder except as to acts or omissions occurring prior to
such resignation and any successor depositor appointed by the Trustee pursuant
to Section 7.01(g) shall thereupon perform all duties and be entitled to all
rights under this Indenture. The successor Depositor shall not be under any
liability hereunder for occurrences or omissions prior to the execution of such
instrument. Notice of such resignation and appointment of a successor depositor
shall be delivered by the Trustee to each Unitholder then of record."
23. The first paragraph of Section 3.11 of the Standard Terms and Conditions
of Trust shall be replaced in its entirety with the following:
"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 holders of the Securities
(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 matter
relating to the Securities), 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 which includes electronic communication;
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 or refrain from
taking any action, (i) so as to insure that the Equity Securities are voted as
closely as possible in the same manner and the same general proportion, with
respect to all issues, as are shares of such Equity Securities that are held by
owners other than the Trust and (ii) as it, in its sole discretion, shall deem
advisable with respect to the Bonds. Notwithstanding the foregoing, 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 holders of Fund Shares (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 matter relating to the
Equity Securities), the Trustee shall promptly notify the Depositor and shall
thereupon take such reasonable action or refrain from taking any action with
respect to the Fund Shares so that the Fund Shares are voted as closely as
possible in the same manner and the same general proportion, with respect to all
issues, as are shares of such Fund Shares that are held by owners other than the
Trust."
24. The Standard Terms and Conditions of Trust shall be amended to include
the following sections:
"Section 3.20. Refunding Bonds. In the event that an offer shall be made
by an obligor of any of the Bond in a Trust to issue new obligations in exchange
and 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 to hold or sell such Bonds, except that if
(1) the issuer is in default with respect to such Bonds or (2) in the opinion of
the Depositor, given in writing to the Trustee, the issuer will probably default
with respect to such
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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 obligation so received in
exchange shall be deposited hereunder and shall be subject to the terms and
conditions of this Indenture to the same extent as the Bonds originally
deposited hereunder. Within five days after such deposit, notice of such
exchange and deposit shall be given by the Trustee to each Unitholder of such
Trust, including an identification of the Bonds eliminated and the securities
substituted therefor.
Section 3.21. Trustee Not Required to Amortize. Nothing in this
Indenture, or otherwise, shall be construed to require the Trustee to make any
adjustments between the Income and Capital Accounts of any Trust by reason of
any premium or discount in respect of any of the Bonds."
25. Section 5.01 of Standard Terms and Conditions of Trust shall be replaced
in its entirety with the following:
Section 5.01. Evaluation of Securities. (a) The Evaluator shall determine
separately, and shall promptly furnish to the Trustee and the Depositor upon
request, the value of each issue of Securities (including Contract Securities)
("Evaluation") as of the Evaluation Time (i) on each Business Day during the
period which the Units are being offered for sale to the public and (ii) on any
other day on which a Trust Evaluation is to be made pursuant to Section 6.01 or
which is requested by the Depositor or the Trustee. As part of the Trust
Evaluation, the Evaluator shall determine separately and promptly furnish to the
Trustee and the Depositor upon request the Evaluation of each issue of
Securities initially deposited in a Trust on the Initial Date of Deposit. The
Evaluator's determination of the offering prices of the Securities on the
Initial Date of Deposit shall be included in the schedule(s) attached to the
Trust Agreement.
(b) During the initial offering period of a Trust (as determined by the
Depositor and described in the related Prospectus) the Evaluation for each
Security shall be made in the following manner: (i) with respect to Securities
for which market quotations are readily available, such Evaluation shall be made
on the basis of the current market value of such Securities; and (ii) with
respect to other Securities' such Evaluation shall be made on the basis of the
fair value of such Securities as determined in good faith by the Evaluator. If
the Securities are listed on a national or foreign securities exchange and
market quotations of such Securities are readily available, the market value of
such Securities shall generally be based on the last available closing sale
price at or immediately prior to the Evaluation Time on the exchange or market
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 ask prices of the
Securities. If the Securities are not so listed or, if so listed, the principal
market therefor is other than on such exchange, or if 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) in the case of Equity Securities and Options, on the basis of
the current ask price for comparable securities (unless the Evaluator deems such
price inappropriate as a basis for evaluation), (ii) on the basis of current
offering prices for the Bonds; (iii) if current ask or offering prices are not
available for
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the Securities, on the basis of current ask or offering prices for comparable
securities, (iv) by determining the valuation of Securities on the ask or
offering side of the market by appraisal, (v) by causing the value of the
Securities to be determined by others engaged in the practice of evaluation,
quoting or appraising comparable securities or (vi) by any combination of the
above With respect to Fund Shares that are not listed on a national or foreign
securities exchange, such valuations shall be made on the basis of the current
net asset value of such shares as determined by the issuers of such Fund Shares.
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). As used herein, the closing sale price
is deemed to mean the most recent closing sale price on the relevant securities
exchange at or immediately prior to the Evaluation Time. For each Evaluation,
the Evaluator shall also confirm and furnish to the Depositor the calculation of
the Trust Evaluation to be computed pursuant to Section 6.01.
(c) For purposes of the Trust Evaluations required by Section 6.01 in
determining Redemption Price and Unit Value and for secondary market purchases,
Evaluation of the Securities shall be made in the manner described in Section
5.01(b), on the basis of the last available bid prices of the securities (rather
than ask or 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 5.01(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.
26. The first paragraph of Section 6.01 of Standard Terms and Conditions of
Trust shall be replaced in its entirety with the following:
"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 or moneys in the process of being collected
from matured interest coupons or bonds matured or called for redemption prior to
maturity (excluding (A) 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 Income and Capital
Accounts because of failure to apply such moneys to the purchase of Contract
Securities pursuant to the provisions of Sections 2.01, 3.02 and 3.03 and (B)
amounts credited to the Reserve Account pursuant to Section 3.04), plus (ii) the
aggregate Evaluation of all Securities (including Contract Securities and
additional Securities for which purchase contracts have been entered into
pursuant to the Depositor's instructions pursuant to clause (ii) of the first
sentence of Section 2.01(b), less the purchase price of such contracts) on
deposit in such Trust (such Evaluation to be made on the basis of the aggregate
underlying value of the Securities as determined in Section 5.01(b) for the
purpose of computing redemption value of Units as set forth in Section 6.02),
plus (iii) all other income from the Securities (including dividends receivable
on the Equity Securities trading ex-dividend
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as of the date of such valuation and including interest accrued on the Bonds not
subject to collection and distribution) as of the Evaluation Time on the date of
such Evaluation together with all other assets of such Trust. For each such
computation there shall be deducted from the sum of the above (i) amounts
representing any applicable taxes or 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
expenses of such Trust including but not limited to unpaid fees and expenses of
the Trustee, the Evaluator, the Supervisor, the Depositor and counsel, in each
case as reported by the Trustee to the Depositor on or prior to the date of
computation, (iii) amounts representing unpaid organization costs, (iv) if the
Prospectus for a Trust provides that the Creation and Development Fee, if any,
accrues on a daily basis, amounts representing unpaid accrued Creation and
Development fees, (v) if the Prospectus for a Trust provides that the deferred
sales charge, if any, accrues on a daily basis, amounts representing unpaid
accrued deferred sales charge, and (vi) any amounts identified by the Trustee,
as of the date of such computation, as held for distribution to Unitholders of
record as of an Income or Capital Account Record Date, or for payment of the
Redemption Price of Units tendered, prior to such date. The resulting figure is
herein called a "Trust 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." Amounts receivable by the Trust in
foreign currency shall be reported to the Evaluator who shall convert the same
to U.S. dollars based on current exchange rates, in the same manner as provided
in Section 5.01(b) or 5.01(c), as applicable, for the conversion of the
valuation of foreign Securities, and the Evaluator shall report such conversion
with each Evaluation made pursuant to Section 5.01."
27. Notwithstanding anything to the contrary in the Standard Terms and
Conditions of Trust, no Unitholder may request a distribution of Securities in-
kind pursuant to Sections 6.02, 6.05 or 9.02.
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IN WITNESS WHEREOF, the undersigned have caused this Trust Agreement to be
executed; all as of the day, month and year first above written.
ADVISORS ASSET MANAGEMENT, INC.
By /s/ XXXX X. XXXXXXXX
------------------------------
Senior Vice President
THE BANK OF NEW YORK MELLON
By /s/ XXXXXXX XXXXXXXX
-----------------------------
Vice President
SCHEDULE A TO TRUST AGREEMENT
SECURITIES INITIALLY DEPOSITED
IN
ADVISORS DISCIPLINED TRUST 1823
Incorporated herein by this reference and made a part hereof is the schedule set
forth under "Investment Summary--Portfolio" in the Prospectus for the Trust.
