EXHIBIT 1.1
XXX XXXXXX UNIT TRUSTS, MUNICIPAL SERIES 1096
TRUST AGREEMENT
Dated: August 8, 2012
This Trust Agreement among Xxx Xxxxxx Funds Inc., as Depositor, The Bank of
New York Mellon, as Trustee, Standard & Poor's Securities Evaluations, Inc., as
Evaluator, and Invesco Investment Advisers LLC, 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 Schedule 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
3 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" 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" in
the Prospectus Part I for a Trust.
7. The definition and all references to the term "Semi-Annual Distribution
Date" in the Standard Terms and Conditions of Trust are hereby deleted.
8. The definition and all references to the term "Semi-Annual Record Date" in
the Standard Terms and Conditions of Trust are hereby deleted.
9. 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.
10. The term "Supervisor" shall mean Invesco Investment Advisers LLC and its
successors in interest or any successor supervisor appointed as provided in the
Standard Terms and Conditions of Trust.
11. The term "Trustee" shall mean The Bank of New York Mellon and its
successors in interest or any successor trustee appointed as provided in the
Standard Terms and Conditions of Trust.
12. Notwithstanding any references to the term "Certificate" in the Standard
Terms and Conditions of Trust, all ownership of Units will be evidenced solely
in book-entry form, and will not be evidenced by certificates. Accordingly, the
definition and all references to the term "Certificate" in the Standard Terms
and Conditions of Trust, including but not limited to the form of "Certificate
of Ownership", Section 2.05 and Section 6.04 are hereby deleted in their
entirety to reflect Unit ownership solely in book-entry form.
13. Section 2.03(b) of the Standard Terms and Conditions of Trust shall be
replaced in its entirety by the following:
"(b) Units shall be held solely in uncertificated form evidenced by
appropriate notation in the registration books of the Trustee, and no Unitholder
shall be entitled to the issuance of a Certificate evidencing the Units owned by
such Unitholder. The only permitted registered holders of Units shall be through
the Depository Trust Company (or its nominee, Cede & Co.); consequently,
individuals must hold their Units through an entity which is a participant in
Depository Trust Company."
14. The first ten paragraphs of Section 3.05 of the Standard Terms and
Conditions of Trust shall be replaced in their entirety with the following:
"Section 3.05. Distributions. 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 Interest Account to Unitholders of such Trust. The Trustee
shall also advance from its own funds and pay the appropriate persons the
Trustee Advance, which amount represents interest which accrues on any "when, as
and if issued" Bonds deposited in a Trust from the First Settlement Date to the
respective dates of delivery to the Trust of any of such Bonds. Subsequent
distributions shall be made as hereinafter provided.
Subsequent distributions of funds from the Interest Account of a Trust shall
be made on the Monthly Record Dates of a Trust as described herein.
As of each Monthly Record Date, the Trustee shall, with respect to each
Trust:
(a) deduct from the Interest Account or, to the extent funds are not
available in such Account, from the Principal Account and pay to itself
individually the amounts that it is at the time entitled to receive pursuant to
Section 7.04;
(b) deduct from the Interest Account, or, to the extent funds are not
available in such Account, from the Principal Account and pay to the Evaluator
the amount that it is at the time entitled to receive pursuant to Section 5.03;
(c) deduct from the Interest Account, or, to the extent funds are not
available in such Account, from the Principal Account and pay to any Portfolio
Insurer the amount of any premium to which it is at the time entitled to receive
pursuant to Section 2.06;
(d) deduct from the Interest Account, or to the extent funds are not
available in such Account, from the Principal Account and pay to the Depositor
the amount that it is entitled to receive pursuant to Section 3.15;
(e) deduct from the Interest Account, or to the extent funds are not
available in such Account, from the Principal Account and pay to the Supervisor
the amount that it is entitled to receive pursuant to Section 4.01; and
(f) deduct from the Interest Account, or, to the extent funds are not
available in such Account, from the Principal Account and pay to counsel, as
hereinafter provided for, an amount equal to unpaid fees and expenses, if any,
of such bond counsel pursuant to Section 3.09 as certified to by the Depositor.
(g) Notwithstanding any of the previous provisions, if a Trust has elected to
be taxed as a regulated investment company under the United States Internal
Revenue Code of 1986, as amended, 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.
On or shortly after each Monthly Distribution Date for a Trust, the Trustee
shall distribute by mail to or upon the order of each Unitholder of record of
such Trust as of the close of business on the preceding Monthly Record Date at
the post office address appearing on the registration books of the Trustee such
Unitholder's pro rata share of the balance of the Interest Account calculated as
of the Monthly Record Date on the basis of one-twelfth of the estimated annual
interest income to such Trust for the ensuing twelve months, after deduction of
the estimated costs and expenses of such Trust to be incurred during the twelve
month period for which the interest income has been estimated.
In the event the amount on deposit in the Interest Account of a Trust is not
sufficient for the payment of the amount of interest to be distributed to
Unitholders on the bases of the aforesaid computations, the Trustee may advance
its own funds and cause to be deposited in and credited to such Interest Account
such amounts as may be required to permit payment of the monthly interest
distribution to be made as aforesaid and shall be entitled to be reimbursed out
of amounts credited to the Interest Account subsequent to the date of such
advance.
Distributions of amounts represented by the cash balance in the Principal
Account for a Trust shall be computed as of each Monthly Record Date. On each
Monthly Distribution Date, or within a reasonable period of time thereafter, the
Trustee shall distribute by mail to each Unitholder of record of such Trust at
the close of business on the preceding Monthly Record Date at his post office
address such Unitholder's pro rata share of the cash balance of the Principal
Account as thus computed. The Trustee shall not be required to make a
distribution from the Principal Account unless the cash balance on deposit
therein available for distribution shall be sufficient to distribute at least
$5.00 per Unit. However, funds in the Principal Account will be distributed on
the last Monthly Distribution Date of each calendar year to Unitholders of
record as of the preceding Monthly Record Date if the amount available for
distribution shall equal at least $1.00 per Unit."
15. Section 3.07(h) of the Standard Terms and Conditions of Trust shall be
replaced in its entirety by the following:
"(h) that as of any Monthly Record Date any of the Bonds are scheduled to be
redeemed and paid prior to the next succeeding Monthly 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 Principal Account at least $5.00 per Unit; or"
16. 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."
17. 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."
18. 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."
19. The Standard Terms and Conditions of Trust shall be amended to include
the following section:
"Section 3.18. Regulated Investment Company Election. 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 or to provide funds to make any
distribution for a taxable year in order to avoid imposition of any income or
excise tax on the Trust or on undistributed income in the Trust. The Trustee
shall make such reviews of each Trust portfolio as shall be necessary to
maintain qualification of a particular Trust as a regulated investment company
and to avoid imposition of tax on a Trust or undistributed income in a Trust,
and the Depositor and Supervisor shall be authorized to rely conclusively upon
such reviews."
20. For purposes of Section 5.01(a), "Business Day" shall mean days the New
York Stock Exchange is open for business.
21. Section 6.02 is amended by adding the following to the end of the
section:
"Notwithstanding anything to the foregoing, in connection with any redemption
by a Unitholder of 1,000 or more Units or Units having an aggregate Redemption
Price of $1,000,000 or more, the Trustee may in its discretion, and shall when
so instructed by the Depositor, satisfy such redemption through a distribution
of such Unitholder's pro rata portion of each Bond then held by the Trust. Such
tendering Unitholder will receive his pro rata number of Bonds comprising the
portfolio of such Trust, cash from the Interest Account representing interest
and cash from the Principal Account equal to any balance to be paid on such
redemption, including accrued interest. Such pro rata share of each Bond and the
related cash to which such tendering Unitholder is entitled is referred to
herein as an "In Kind Distribution." An In Kind Distribution will be made by the
Trustee through the distribution of each of the Bonds in book-entry form to the
account of the Unitholder's bank or broker-dealer at Depository Trust Company.
If funds in the Interest or Principal Account are insufficient to cover the
required cash distribution to the tendering Unitholder, the Trustee may sell
Bonds according to the criteria discussed herein."
22. Section 6.03 of the Standard Terms and Conditions of Trust shall be
replaced in its entirety by the following:
"Section 6.03. Transfer or Interchange of Units. Units may be transferred by
the registered holder thereof by presentation and surrender of such Units at the
corporate trust office of the Trustee, properly endorsed or accompanied by a
written instrument or instruments of transfer in form satisfactory to the
Trustee and executed by the Unitholder or his authorized attorney, whereupon new
Units will be issued in exchange and substitution therefore and Units
surrendered shall be cancelled by the Trustee. The registered holder of any Unit
may transfer such Unit by the presentation of transfer instructions to the
Trustee at the corporate trust office of the Trustee accompanied by such
documents as the Trustee deems necessary to evidence the authority of the person
making such transfer and executed by the registered holder or his authorized
attorney, whereupon the Trustee shall make proper notification of such transfer
on the registration books of the Trustee. A sum sufficient to pay any tax or
other governmental charge that may be imposed in connection with any such
transfer or interchange shall be paid by the Unitholder to the Trustee."
23. 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. In addition, the last sentence of the first
paragraph of Section 7.04 is hereby deleted.
24. 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 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 in
regard to matters or questions arising hereunder as shall not materially
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 Bonds 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 without the consent of all affected Unitholders.
(b) Except for the amendments, changes or modifications 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 75% 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, (3)
adversely affect the tax status of the Trust for federal income tax purposes or
result in the Units being deemed to be sold or exchanged for federal income tax
purposes or (4) unless the Trust has elected to be taxed as a regulated
investment company for federal income tax purposes, result in a variation of the
investment of Unitholders in the Trust.
(c) Unless the Depositor directs that other notice shall be provided, the
Trustee shall include in the annual report provided pursuant to Section 3.06
notification of the substance of such amendment."
25. The first sentence of Section 9.02 of the Standard Terms and Conditions
of Trust shall be replaced in its entirety with the following:
"Section 9.02. Termination. This Indenture and any Trust created hereby shall
terminate upon the maturity, redemption, sale or other disposition as the case
may be of the last Bond held in such Trust unless sooner terminated as
hereinbefore specified and may be terminated at any time by the written consent
of Unitholders representing 75% of the then outstanding Units of such Trust;
provided, that in no event shall a Trust continue beyond the end of the calendar
year preceding the fiftieth anniversary of the execution of the related Trust
Agreement except for an IM-IT Limited Maturity Trust, IM-IT Intermediate Trust,
IM-IT Short Intermediate Trust, Quality Intermediate Trust, Investment Grade
Municipal Trust, Intermediate Series or Quality Municipals Income Trust, Limited
Maturity Series which in no event shall continue beyond the end of the calendar
year preceding the twentieth anniversary of the execution of the related Trust
Agreement (the respective "Mandatory Termination Date"); and provided further
that in connection with any such liquidation it shall not be necessary for the
Trustee to dispose of any Bond of such Trusts if retention of such Bond, until
due, shall be deemed to be in the best interests of Unitholders, including, but
not limited to, situations in which a Bond insured by the Portfolio Insurance,
if any, is in default, situations in which a Bond insured by Portfolio Insurance
reflects a deteriorated market price resulting from a fear of default and
situations in which a Bond matures after the Mandatory Termination Date."
26. The final paragraph of Section 9.02 of the Standard Terms and Conditions
of Trust is hereby deleted.
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
---------------------------------------------
Vice President
INVESCO INVESTMENT ADVISERS LLC
By: /s/ XXXX X. XXXXXXX
---------------------------------------------
Vice President and Executive Director
STANDARD & POOR'S SECURITIES EVALUATIONS, INC.
By: /s/ XXXXX X. XXXXXXXX
---------------------------------------------
Senior Vice President
THE BANK OF NEW YORK MELLON
By: /s/ XXXXX XXXXXXXXX
---------------------------------------------
Managing Director
SCHEDULE A TO TRUST AGREEMENT
SECURITIES INITIALLY DEPOSITED
IN
XXX XXXXXX UNIT TRUSTS, MUNICIPAL SERIES 1096
[Incorporated herein by this reference and made a part hereof is the
"Portfolio" schedule as set forth in the Prospectus Part I for the Trust.]
