Document/Exhibit Description Pages Size
1: 487 Municipal Series 1230 83± 321K
2: EX-99.1.1 Trust Agreement 3± 8K
3: EX-99.3.1 Legal Opinion 3± 11K
4: EX-99.3.3 Legal Opinion 2± 9K
5: EX-99.4.1 Standard & Poor's Consent 1 6K
6: EX-99.4.2 Grant Thornton Consent 1 5K
File No. 333-198351
CIK #1576549
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 2
TO
REGISTRATION STATEMENT
ON
FORM S-6
For Registration under the Securities Act of 1933 of Securities of Unit
Investment Trusts Registered on Form N-8B-2.
A. Exact Name of Trust: INVESCO UNIT TRUSTS, MUNICIPAL SERIES 1230
B. Name of Depositor: INVESCO CAPITAL MARKETS, INC.
C. Complete address of Depositor's principal executive offices:
11 Greenway Plaza
Houston, Texas 77046-1173
D. Name and complete address of agents for service:
PAUL HASTINGS LLP INVESCO CAPITAL MARKETS, INC.
Attention: Michael R. Rosella, Esq. Attention: John M. Zerr, Esq.
75 East 55th Street 11 Greenway Plaza
New York, New York 10022 Houston, Texas 77046-1173
E. Title of securities being registered: Units of fractional undivided
beneficial interest.
F. Approximate date of proposed sale to the public:
AS SOON AS PRACTICABLE AFTER THE EFFECTIVE DATE OF THE REGISTRATION STATEMENT
/ X / Check box if it is proposed that this filing will become effective
immediately upon filing on May 26, 2015, pursuant to Rule 487.
Investment Grade Municipal Trust, 7-13 Year Series 60
Investment Grade Municipal Trust, 7-13 Year Series 60 invests in a portfolio
of tax-exempt municipal bonds. The Trust seeks to provide federal tax-exempt
income and to preserve capital. The Trust is a unit investment trust included
in Invesco Unit Trusts, Municipal Series 1230.
Monthly
Distributions
-------------
Estimated Current Return: 3.48%
Estimated Long Term Return: 2.50%
Estimated current return shows the estimated cash you should receive each
year divided by the Unit price. Estimated long term return shows the estimated
return over the estimated life of your Trust. These estimates are as of the
opening of business on the Date of Deposit and will vary thereafter. We base
this estimate on an average of the bond yields over their estimated life. This
estimate also reflects the sales charge and estimated expenses. We derive the
average yield for your portfolio by weighting each bond's yield by its value
and estimated life. Unlike estimated current return, estimated long term return
accounts for maturities, discounts and premiums of the bonds. These estimates
show a comparison rather than a prediction of returns. No return calculation
can predict your actual return. Your actual return may vary from these
estimates.
May 26, 2015
You should read this prospectus and retain it for future reference.
--------------------------------------------------------------------------------
The Securities and Exchange Commission has not approved or disapproved of the
Trust Units or passed upon the adequacy or accuracy of this prospectus.
Any contrary representation is a criminal offense.
INVESCO
Investment Objective. The Trust seeks to provide federal tax-exempt income
and to preserve capital.
Principal Investment Strategy. The Trust invests in a portfolio of municipal
bonds issued by or on behalf of states and territories of the United States,
and political subdivisions and authorities thereof, the interest on which is,
in the opinion of recognized bond counsel to the issuing authorities,
excludable from gross income for federal personal income tax purposes under
existing law. In selecting bonds for the Trust, the Sponsor considered the
following factors, among others:
o all ratings provided for the bonds must be at least "BBB-" if issued
by either Standard & Poor's or Fitch Ratings, and at least "Baa3" if
issued by Moody's Investors Service, Inc. or, in the case of a bond
with no issued ratings, such a bond has credit characteristics
sufficiently similar to those of comparable bonds that were so rated
as to be acceptable for acquisition by the Trust in the opinion of the
Sponsor;
o the prices of the bonds relative to other bonds of comparable quality
and maturity;
o the current income provided by the bonds;
o the diversification of bonds as to purpose of issue and location of
issuer; and
o the probability of early return of principal or high legal or event
risk.
The portfolio generally consists of bonds maturing approximately 7 to 13
years from the Date of Deposit. Following the Date of Deposit, a bond may cease
to be rated or its rating may be reduced, even to below "investment grade"
("BBB-" or "Baa3"), and the Trust could continue to hold such bond. See "Trust
Administration--Portfolio Administration".
Principal Risks. As with all investments, you can lose money by investing in
the Trust. The Trust also might not perform as well as you expect. This can
happen for reasons such as these:
o Bond prices will fluctuate. The value of your investment may fall over
time.
o The value of the bonds will generally fall if interest rates, in
general, rise. No one can predict whether interest rates will rise or
fall in the future.
o A bond issuer or insurer may be unable to make interest and/or
principal payments in the future.
o The financial condition of an issuer may worsen or its credit ratings
may drop, resulting in a reduction in the value of your Units. This
may occur at any point in time, including during the primary offering
period.
o A bond issuer might prepay or "call" a bond before its stated
maturity. If this happens, the Trust will distribute the principal to
you but future interest distributions will fall. A bond's call price
could be less than the price the Trust paid for the bond. If enough
bonds are called, the Trust could terminate earlier than expected.
o We do not actively manage the Trust's portfolio. Except in limited
circumstances, the Trust will hold the same bonds even if the market
value declines.
Summary of Essential Financial Information
(As of the opening of business on the Date of Deposit)
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=============================================================================================================================
General Information Unit Price
------------------------------------------------------------- --------------------------------------------------------------
Date of Deposit May 26, 2015 Aggregate offering price of bonds in Trust $ 6,196,622
Principal amount of bonds in Trust $5,670,000 Aggregate offering price of bonds per Unit $ 1,092.88
Principal amount of bonds per Unit (1) $1,000.00 Plus sales charge per Unit $ 33.80
Number of Units 5,670 Plus organization costs per Unit (2) $ 6.48
Weighted average maturity of bonds 11 years Public offering price per Unit (3) $ 1,133.16
Redemption price per Unit (2)(3) $ 1,094.36
============================================================= ==============================================================
Portfolio Diversification (% of Par Value) Estimated Annual Income Per Unit
------------------------------------------------------------- --------------------------------------------------------------
General Obligation 31% Arizona 7% Estimated interest income $ 42.49
Higher Education 12 California 6 Less estimated expenses (4) $ 3.01
Certificate of Participation 11 Colorado 4 Estimated net interest income $ 39.48
General Purpose 11 Florida 14
Public Education 10 Illinois 16
Health Care 8 Louisiana 1
Transportation 6 Michigan 4
Wholesale Electric 4 Missouri 4
Airport 4 Nevada 4
Retail Electric/Gas/ New Jersey 15
Telephone 3 New York 1
------ Pennsylvania 9
Total 100% Texas 8
====== Utah 4
Washington 1
Wisconsin 2
------
100%
======
============================================================= ==============================================================
Expenses Estimated Distributions
------------------------------------------------------------- --------------------------------------------------------------
Sales Charge (% of Unit Price) 3.00% Initial interest distribution $ 4.49 on
Organizational Costs per Unit (2) $ 6.48 July 25, 2015
============ Subsequent interest distributions (6) $ 3.29
Estimated Annual Expenses per Unit Record dates 10th day of each month
Trustee's fee (5) $ 0.92 Distribution dates 25th day of each month
Supervisory, bookkeeping and
administrative services fee $ 0.55 --------------------------------------------------------------
Evaluation fee (5) $ 0.37 CUSIP Numbers
Other operating expenses $ 1.17 --------------------------------------------------------------
------------ Monthly 46137B-24-5
Total annual expenses per Unit $ 3.01 Monthly Wrap Fee 46137B-25-2
============
=============================================================================================================================
(1) Some bonds may mature or be called or sold during your Trust's life. This
could include a call or sale at a price below par value. We cannot
guarantee that the value of your Units will equal the principal amount of
bonds per Unit when you redeem them or when your Trust terminates.
(2) During the initial offering period, part of the value of the Units
represents an amount of cash deposited to pay all or a portion of the costs
of organizing the Trust. The estimated organization costs per Unit will be
deducted from the assets of the Trust at the earlier of six months after
the Date of Deposit or the end of the initial offering period. If Units are
redeemed prior to any such reduction, these costs will not be deducted from
the redemption proceeds. Organization costs are not included in the Public
Offering Price per Unit for purposes of calculating the sales charge.
(3) After the first settlement date (May 29, 2015), you will pay accrued
interest from this date to your settlement date less interest
distributions.
(4) This shows estimated expenses in the first year other than organization
costs. Organization costs are not deducted from interest income.
(5) Your Trust assesses this fee per $1,000 principal amount of bonds. Your
Trust assesses other fees per Unit.
(6) We base this amount on estimated cash flows per Unit. This amount will vary
with changes in expenses, interest rates and maturity, call or sale of
bonds. The Information Supplement includes the estimated cash flows.
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PORTFOLIO (as of the opening of business on the Date of Deposit)
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Offering
Aggregate Name of Issuer, Title, Interest Rate and Redemption Price To
Principal Maturity Date of Bonds (1)(2) Ratings (3) Feature (4) Trust (2)
---------------------------------------------------------------------------------------------------------------------
$ 100,000 Illinois, County of Cook, General Obligation Refunding
Bonds, Series A
5.00% Due 11/15/2022 AA A1 __________ $ 108,780
85,000 Pennsylvania, Butler County Hospital Authority Refunding
Revenue Bonds, Butler Health System Project, Series A
5.00% Due 07/01/2023 NR Baa1 __________ 97,892
120,000 Illinois, Cook County, School District No. 109 General
Obligation Bonds, Indian Springs
3.00% Due 12/01/2023 AA NR __________ 121,499
40,000 Illinois, Chicago O'Hare International Airport, General
Airport Senior Lien Revenue Refunding Bonds,
Series B
5.00% Due 01/01/2024 A- A2 2023 @ 100 46,184
250,000 Arizona, Maricopa County Mesa Unified School District
No. 4, General Obligation Bonds School Improvement
Project 2012, Series C
3.00% Due 07/01/2024 AA- Aa2 __________ 257,667
15,000 New Jersey Educational Facilities Authority Revenue Bonds,
William Paterson University of New Jersey Issue, Series C
3.00% Due 07/01/2024 NR A1 2022 @ 100 15,315
225,000 New Jersey Institute of Technology General Obligation
Revenue Bonds, Series A
5.00% Due 07/01/2024 A A1 __________ 264,645
150,000 Pennsylvania, Butler County Hospital Authority Refunding
Revenue Bonds, Butler Health System Project, Series A
5.00% Due 07/01/2024 NR Baa1 __________ 172,419
15,000 Florida, Hillsborough County Industrial Development
Authority, Hospital Revenue Refunding Bonds,
Tampa General Hospital Project, Series A
5.00% Due 10/01/2024 NR A3 2023 @ 100 17,275
235,000 Colorado, City of Aurora Certificates of Participation
3.50% Due 12/01/2024 NR Aa2 __________ 252,263
315,000 New Jersey Transportation Trust Fund Authority,
Transportation System Revenue Bonds, Series D
5.00% Due 12/15/2024 A- A3 __________ 337,510
100,000 Illinois, Chicago Midway Airport Second Lien Revenue
Refunding Bonds, Series B
5.00% Due 01/01/2025 A- A3 2024 @ 100 115,554
225,000 Utah, Ogden City School District Municipal Building
Authority Revenue Bonds
5.00% Due 01/15/2025 NR Aa3 2024 @ 100 264,798
20,000 Illinois, Board of Trustees of Illinois State University,
Certificates of Participation, Capital Improvement
Projects, Series A-2 (Build America Mutual
Assurance Insured)
4.00% Due 04/01/2025 AA A3 2024 @ 100 21,245
110,000 Illinois State Sales Tax Revenue Bonds, Build Illinois Bonds
#3.75% Due 06/15/2025 AAA NR 2021 @ 100 115,519
150,000 Florida, School Board of Broward County Certificates of
Participation, Series A
5.00% Due 07/01/2025 A A1 __________ 177,859
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PORTFOLIO (as of the opening of business on the Date of Deposit) (continued)
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Offering
Aggregate Name of Issuer, Title, Interest Rate and Redemption Price To
Principal Maturity Date of Bonds (1)(2) Ratings (3) Feature (4) Trust (2)
---------------------------------------------------------------------------------------------------------------------
$ 50,000 New Jersey Educational Facilities Authority Revenue Bonds,
William Paterson University of New Jersey Issue, Series C
3.00% Due 07/01/2025 NR A1 2022 @ 100 $ 50,568
125,000 Illinois, Cook County Refunding General Obligation Bonds,
Series C
5.00% Due 11/15/2025 AA A1 2022 @ 100 133,626
150,000 Arizona, Electrical District No. 4 of Pinal County, Revenue
Refunding Bonds (Assured Municipal Insured)
5.00% Due 12/01/2025 AA NR __________ 177,630
70,000 Wisconsin Health and Educational Facilities Authority,
Health Facilities Revenue Bonds, UnityPoint Health,
Series A
5.00% Due 12/01/2025 NR Aa3 2024 @ 100 81,152
225,000 Florida, Lake County School Board Certificates of
Participation, Series B (Assured Municipal Insured)
5.00% Due 06/01/2026 AA NR 2025 @ 100 262,685
15,000 Illinois State Sales Tax Revenue Bonds, Build Illinois Bonds
4.00% Due 06/15/2026 AAA NR 2021 @ 100 15,772
20,000 New Jersey Health Care Facilities Financing Authority
Revenue and Refunding Bonds, Barnabas Health
Issue, Series A
4.00% Due 07/01/2026 A- A3 2022 @ 100 20,915
200,000 Nevada State General Obligation Bonds, University System
Projects, Series A
4.00% Due 08/01/2026 AA Aa2 2025 @ 100 220,268
475,000 Texas, Lewisville Independent School District Refunding
General Obligation Bonds
4.00% Due 08/15/2026 AA+ NR 2024 @ 100 515,371
150,000 Illinois, Will County, Romeoville Revenue Bonds, Lewis
University Project
5.00% Due 10/01/2026 BBB+ NR 2025 @ 100 168,685
70,000 New York, New York City Transitional Finance Authority
Future Tax Secured Tax-Exempt Subordinate Revenue
Bonds, Series D
#2.25% Due 11/01/2026 AAA Aa1 2022 @ 100 65,949
50,000 Louisiana, New Orleans Aviation Board General Airport
Revenue Bonds, North Terminal Project, Series A
5.00% Due 01/01/2027 A- A3 2025 @ 100 57,635
15,000 Missouri Joint Municipal Electric Utility Commission, Power
Project Revenue Bonds, Plum Point Project, Series A
5.00% Due 01/01/2027 A- A3 2025 @ 100 17,358
240,000 Michigan, Jackson College Facilities General Obligation
Bonds
#3.00% Due 05/01/2027 NR Aa3 2025 @ 100 237,406
10,000 Washington, Central Washington University, System
Revenue Refunding Bonds
4.00% Due 05/01/2027 NR A1 2023 @ 100 10,570
35,000 Illinois, Regional Transportation Authority Revenue Bonds,
Series B (National Guarantee Insured)
5.50% Due 06/01/2027 AA Aa3 2024 @ 100 S.F. 42,956
[Enlarge/Download Table]
PORTFOLIO (as of the opening of business on the Date of Deposit) (continued)
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Offering
Aggregate Name of Issuer, Title, Interest Rate and Redemption Price To
Principal Maturity Date of Bonds (1)(2) Ratings (3) Feature (4) Trust (2)
---------------------------------------------------------------------------------------------------------------------
$ 225,000 Missouri Joint Municipal Electric Utility Commission
Revenue Refunding Bonds, Prairie State Project,
Series A
5.00% Due 06/01/2027 NR A2 2025 @ 100 $ 260,800
425,000 Florida, County of Miami-Dade, Transit System Sales Surtax
Revenue Refunding Bonds
5.00% Due 07/01/2027 AA A1 2025 @ 100 495,860
250,000 New Jersey Educational Facilities Authority Revenue and
Refunding Bonds, Ramapo College, Series B (Assured
Municipal Insured)
#3.25% Due 07/01/2027 AA A2 2025 @ 100 247,550
245,000 California, Atascadero Unified School District General
Obligation Bonds, Series A
#3.00% Due 08/01/2027 NR Aa3 2025 @ 100 242,038
75,000 Illinois Finance Authority Refunding Revenue Bonds,
Advocate Health Care
5.00% Due 08/01/2027 AA Aa2 2024 @ 100 86,359
50,000 Wisconsin Health and Educational Facilities Authority
Revenue Bonds, Aspirus, Inc. Obligated Group
5.00% Due 08/15/2027 A+ A1 2023 @ 100 56,323
250,000 Pennsylvania, State Public School Building Authority
Guaranteed School Lease Revenue Bonds, Dauphin
County Technical School Refunding Project
#2.70% Due 09/15/2027 NR Aa3 2024 @ 100 233,767
95,000 California, Municipal Finance Authority Lease Revenue
Bonds, Jurupa Unified School District, Wineville
School Project, Series A (Build America Mutual
Assurance Insured)
5.00% Due 10/01/2027 AA NR 2025 @ 100 108,955
----------- -----------
$ 5,670,000 $ 6,196,622
=========== ===========
For an explanation of the footnotes used on this page, see "Notes to Portfolio".
Notes to Portfolio
(1) The bonds are represented by "regular way" or "when issued" contracts for
the performance of which an irrevocable letter of credit, obtained from an
affiliate of the Trustee, has been deposited with the Trustee. Contracts to
acquire the bonds were entered into during the period from March 5, 2015 to
May 26, 2015.
(2) The Offering Price to Trust of the bonds is based on the offering side
valuation as of the opening of business on the Date of Deposit determined
by the Evaluator, a third party valuation provider, on the basis set forth
under "Public Offering--Unit Price". In accordance with FASB Accounting
Standards Codification ("ASC"), ASC 820, Fair Value Measurements and
Disclosures, the Trust's investments are classified as Level 2, which
refers to security prices determined using other significant observable
inputs. Observable inputs are inputs that other market participants would
use in pricing a security. These may include quoted market prices for
similar securities, interest rates, prepayment speeds and credit risk. The
cost of the bonds to the Sponsor for the Trust is $6,161,349 and the
Sponsor's profit or (loss) is $35,273.
The Sponsor may have entered into contracts which hedge interest rate
fluctuations on certain bonds. The cost of any such contracts and the
corresponding gain or loss as of the evaluation time of the bonds is
included in the Cost to Sponsor. Bonds marked by "##" following the
maturity date have been purchased on a "when, as and if issued" or "delayed
delivery" basis. Interest on these bonds begins accruing to the benefit of
Unitholders on their respective dates of delivery. Delivery is expected to
take place at various dates after the first settlement date.
"#" prior to the coupon rate indicates that the bond was issued at an
original issue discount. See "The Trusts--Risk Factors". The tax effect of
bonds issued at an original issue discount is described in "Federal Tax
Status".
(3) All ratings are by Standard & Poor's and Moody's, respectively, unless
otherwise indicated. "*" indicates a security rating by Fitch. "NR"
indicates that the rating service did not provide a rating for that bond.
For a brief description of the ratings see "Description of Ratings" in the
Information Supplement.
(4) This is the year in which each bond is initially or currently callable and
the call price for that year. Each bond continues to be callable at
declining prices thereafter (but not below par value) except for original
issue discount bonds which are redeemable at prices based on the issue
price plus the amount of original issue discount accreted to redemption
date plus, if applicable, some premium, the amount of which will decline in
subsequent years. "S.F." indicates a sinking fund is established with
respect to an issue of bonds. The bonds may also be subject to redemption
without premium at any time pursuant to extraordinary optional or mandatory
redemptions if certain events occur. See "The Trusts--Risk Factors".
Underwriting. The Underwriters named below have purchased Units in the
following amounts from the Sponsor, the sole and exclusive principal
underwriter. See "Public Offering--Sponsor and Underwriter Compensation".
[Enlarge/Download Table]
Name Address Units
-------------------------------- ------------------------------------------------------ ------------
SWS Securities Inc. 1201 Elm Street, Suite 4300, Dallas, Texas 75270 3,000
Invesco Capital Markets, Inc. 3500 Lacey Road, Suite 700, Downers Grove, IL 60515-5456 1,788
Wells Fargo Advisors 1 N Jefferson Ave, St. Louis, Missouri 63103 882
------------
5,670
============
Report of Independent Registered Public Accounting Firm
To the Unitholders of Investment Grade Municipal Trust, 7-13 Year Series 60
(included in Invesco Unit Trusts, Municipal Series 1230):
We have audited the accompanying statement of condition including the
related portfolio of Investment Grade Municipal Trust, 7-13 Year Series 60
(included in Invesco Unit Trusts, Municipal Series 1230) as of May 26, 2015.
The statement of condition is the responsibility of the Sponsor. Our
responsibility is to express an opinion on such statement of condition based on
our audit.
We conducted our audit in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the statement of condition is free of material misstatement. We were not
engaged to perform an audit of the Trust's internal control over financial
reporting. Our audit included consideration of internal control over financial
reporting as a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Trust's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the statement of
condition, assessing the accounting principles used and significant estimates
made by the Sponsor, as well as evaluating the overall statement of condition
presentation. Our procedures included confirmation with The Bank of New York
Mellon, Trustee, of cash or an irrevocable letter of credit deposited for the
purchase of securities as shown in the statement of condition as of May 26,
2015. We believe that our audit of the statement of condition provides a
reasonable basis for our opinion.
In our opinion, the statement of condition referred to above presents
fairly, in all material respects, the financial position of Investment Grade
Municipal Trust, 7-13 Year Series 60 (included in Invesco Unit Trusts,
Municipal Series 1230) as of May 26, 2015, in conformity with accounting
principles generally accepted in the United States of America.
New York, New York /s/ GRANT THORNTON LLP
May 26, 2015
Statement of Condition
As of the opening of business on May 26, 2015
INVESTMENT IN BONDS
Contracts to purchase bonds (1)(2) $ 6,196,622
Accrued interest to the first settlement date (1)(2) 39,021
Cash (3) 36,738
-------------
Total $ 6,272,381
=============
LIABILITY AND INTEREST OF UNITHOLDERS
Liability--
Accrued interest payable to Sponsor (1)(2) $ 39,021
Organization costs (3) 36,738
Interest of Unitholders--
Cost to investors 6,425,009
Less: Gross underwriting commission 191,649
Less: Organization costs (3) 36,738
-------------
Net interest to Unitholders (1)(2) 6,196,622
-------------
Total $ 6,272,381
=============
Units outstanding 5,670
=============
Net asset value per Unit $ 1,092.88
=============
-----------------
(1) The value of the bonds is determined by Standard & Poor's Securities
Evaluations, Inc. on the bases set forth under "Public Offering--Unit
Price". The contracts to purchase bonds are collateralized by an
irrevocable letter of credit in an amount sufficient to satisfy such
contracts.
(2) The Trustee will advance the amount of the net interest accrued to the
first settlement date to the Trust for distribution to the Sponsor as the
Unitholder of record as of such date.
(3) A portion of the public offering price represents an amount of cash
sufficient to pay for all or a portion of the costs incurred in
establishing the Trust. The amount of these costs are set forth under
"Summary of Essential Financial Information--Expenses". A distribution will
be made as of the earlier of six months after the Date of Deposit or the
close of the initial offering period to an account maintained by the
Trustee from which the organization expense obligation of the investors
will be satisfied. To the extent that actual organization costs of the
Trust are greater than the estimated amount, only the estimated
organization costs added to the public offering price will be reimbursed to
the Sponsor and deducted from the net assets of the Trust.
THE TRUSTS
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General. Your Trust is one of several unit investment trusts created under
the name Invesco Unit Trusts, Municipal Series. The Trusts were created under
the laws of the State of New York pursuant to a Trust Indenture and Agreement
(the "Trust Agreement"), dated the date of this prospectus (the "Date of
Deposit") among Invesco Capital Markets, Inc. as Sponsor, Invesco Investment
Advisers LLC, as Supervisor, Standard & Poor's Securities Evaluations, Inc., as
Evaluator, and The Bank of New York Mellon, as Trustee.
The Trusts are separate portfolios of interest-bearing obligations issued by
or on behalf of states and territories of the United States, and political
subdivisions and authorities thereof, the interest on which is, in the opinion
of recognized bond counsel to the issuing authorities, excludable from gross
income for Federal income tax purposes under existing law. All issuers of bonds
in a "State Trust" are located in the state for which the Trust is named or in
United States territories or possessions and their public authorities;
consequently, in the opinion of recognized bond counsel to the bond issuers, the
interest earned on the bonds is exempt to the extent indicated in this
prospectus from state and local taxes. With the exception of New York Trusts,
Units of a State Trust may be purchased only by residents of the state for which
the Trust is named. Units of a New York Trust may be purchased by residents of
New York, Connecticut, Florida and New Jersey. Trusts that hold only insured
bonds are referred to herein as "Insured Trusts." "Intermediate-Term Trust"
refers to an Investment Grade Municipal Trust which is designated as a "7-13
year series" in the name of such Trust. Trusts that are named for a particular
state are referred to herein as "State Trusts." On the Date of Deposit, the
Sponsor deposited with the Trustee the aggregate principal amount of bonds
indicated in the "Summary of Essential Financial Information". The bonds in a
Trust initially consist of delivery statements relating to contracts for their
purchase and cash, cash equivalents and/or irrevocable letters of credit issued
by a financial institution. Thereafter, the Trustee, in exchange for the bonds
in a Trust, delivered to the Sponsor evidence of ownership of the number of
Units indicated under "Summary of Essential Financial Information". The bonds in
an Intermediate-Term Trust will mature approximately 7 to 13 years from the Date
of Deposit.
Each Unit initially offered represents a fractional undivided interest in
the principal and net income of a Trust. The number of Units is determined
based upon a $1,000 principal amount of bonds in the Trust per Unit. To the
extent that any Units are redeemed by the Trustee, the fractional undivided
interest in a Trust represented by each Unit will increase, although the actual
interest in the Trust will remain unchanged. Units will remain outstanding
until redeemed by Unitholders or until the termination of the Trust Agreement.
Objectives and Bond Selection. The Trusts seek to preserve capital and to
provide federal tax-exempt income and, in the case of most State Trusts,
Federal and state tax-exempt income taxation. The Trusts invest in portfolios
of municipal bonds issued by or on behalf of states and territories of the
United States, and political subdivisions and authorities thereof, the interest
on which is, in the opinion of recognized bond counsel to the issuing
authorities, excludable from gross income for federal and, for State Trusts,
state personal income tax purposes under existing law. There is, of course, no
guarantee that any Trust will achieve its objectives. A Trust may be an
appropriate investment vehicle for investors who desire to participate in a
portfolio of tax-exempt fixed income bonds with greater diversification than
they might be able to acquire individually. Diversification of a Trust's assets
will not eliminate the risk of loss always inherent in the ownership of bonds.
Insurance guaranteeing the timely payment, when due, of all principal and
interest on the bonds in each Insured Trust has been obtained from municipal
bond insurance companies. For information relating to insurance on the bonds,
see "Insurance on the Bonds in the Insured Trusts."
In selecting bonds for a Trust, the Sponsor considered the following factors,
among others: (a) the ratings criteria applicable to your Trust as listed under
"Principal Investment Strategy", (b) the prices of the bonds relative to other
bonds of comparable quality and maturity, (c) the current income provided by the
bonds, (d) the diversification of bonds as to purpose of issue and location of
issuer and (e) the probability of early return of principal or high legal or
event risk. After the Date of Deposit, a bond may cease to be rated or its
rating may be reduced below the minimum required as of the Date of Deposit.
Neither event requires elimination of a bond from a Trust but may be considered
in the Sponsor's determination as to whether or not to direct the Trustee to
dispose of the bond (see "Trust Administration--Portfolio Administration").
The Bonds. Your Trust invests in municipal bonds. States, municipalities and
public authorities issue these bonds to raise money for a variety of purposes.
In selecting bonds, the Sponsor seeks to diversify your portfolio by type of
bond purpose. This section briefly describes different bond types to help you
better understand your investment. The types of bonds and percentages they
represent in your portfolio are listed under "Summary of Essential Financial
Information". These bonds are also described in greater detail in the
Information Supplement.
General Obligation Bonds and Revenue Bonds. General obligation bonds are
backed by the general taxing power of the issuer. The issuer secures these
bonds by pledging its faith, credit and unlimited taxing power for the payment
of principal and interest. All other bonds in the Trusts are revenue bonds.
Revenue bonds are payable only from the revenue of a specific project or
authority. They are not supported by the issuer's general power to levy taxes.
The risk of default in payment of interest or principal increases if the income
of the related project falters because that income is the only source of
payment. All of the following bonds are revenue bonds.
Airport bonds are obligations of issuers that own and operate airports. The
ability of the issuer to make payments on these bonds primarily depends on the
ability of airlines to meet their obligations under use agreements. Due to
increased competition, deregulation, increased fuel costs and other factors,
some airlines may have difficulty meeting these obligations.
Bond banks are vehicles that pool various municipal obligations into larger
offerings. This reduces the cost of borrowing for the municipalities. The types
of financing projects that these obligations support vary.
Certificates of participation are generally a type of municipal lease
obligation. Lease payments of a governmental entity secure payments on these
bonds. These payments depend on the governmental entity budgeting
appropriations for the lease payments. A governmental body cannot obligate
future governments to appropriate for or make lease payments, but governments
typically promise to take action necessary to include lease payments in their
budgets. If a government fails to budget for or make lease payments, sufficient
funds may not exist to pay interest or principal on these bonds.
Health care bonds are obligations of issuers that derive revenue from
hospitals and hospital systems. The ability of these issuers to make payments
on bonds depends on factors such as facility occupancy levels, demand for
services, competition resulting from hospital mergers and affiliations, the
need to reduce costs, government regulation, costs of malpractice insurance and
claims, and government financial assistance (such as Medicare and Medicaid).
Higher education bonds are obligations of issuers that operate universities
and colleges. These issuers derive revenues from tuition, dormitories, grants
and endowments. These issuers face problems related to declines in the number
of college-age individuals, possible inability to raise tuitions and fees,
uncertainty of continued federal grants, state funding or donations, and
government legislation or regulation.
Industrial revenue bonds finance the cost of acquiring, building or
improving industrial projects. Private corporations usually operate these
projects. The ability of the issuer to make payments on these bonds depends on
factors such as the creditworthiness of the corporation operating the project,
revenues generated by the project, expenses of the project and environmental or
other regulatory restrictions.
Multi-family housing bonds are obligations of issuers that derive revenues
from mortgage loans on multiple family residences, retirement housing or
housing projects for low to moderate-income families. These bonds are generally
pre-payable at any time. It is likely that their life will be less than their
stated maturity. The ability of these issuers to make payments on bonds depends
on such factors as rental income, occupancy levels, operating expenses,
mortgage default rates, taxes, government regulations and appropriation of
subsidies.
Other care bonds include obligations of issuers that derive revenue from
mental health facilities, nursing homes and intermediate care facilities. These
bonds are similar to health care bonds and the issuers face the same general
risks.
Public building bonds finance the cost of acquiring, leasing, building or
improving public buildings such as offices, recreation facilities, convention
centers, police stations, correctional institutions and parking garages. The
ability of the issuers to make payments on these bonds depends on factors such
as the government budgeting sufficient funds to make lease or mortgage payments
on the facility, user fees or rents, costs of maintenance and decreases in use
of the facility.
Public education bonds are obligations of issuers that operate primary and
secondary schools. The ability of these issuers to make payments on these bonds
depends primarily on ad valorem taxes. These issuers may also face problems
related to litigation contesting state constitutionality of public education
financing.
Retail electric/gas/telephone bonds are obligations of issuers that derive
revenues from the retail sale of utilities to customers. The ability of these
issuers to make payments on these bonds depends on factors such as the rates
and demand for these utilities, competition, government regulation and rate
approvals, overhead expenses and the cost of fuels.
Single family housing bonds are obligations of issuers that derive revenues
from mortgage loans on single family residences. Single family residences
generally include one to four-family dwellings. These bonds are similar to
multi-family housing bonds and the issuers face the same general risks.
Tax district bonds are obligations secured by a pledge of taxing power by a
municipality, such as tax increment financing or tax allocation bonds. These
bonds are similar to general obligation bonds. Unlike general obligation bonds,
however, the municipality does not pledge its unlimited taxing power to pay
these bonds. Instead, the municipality pledges revenues from a specific tax to
pay these bonds. If the tax cannot support payment of interest and principal, a
municipality may need to raise the related tax to pay these bonds. An inability
to raise the tax could have an adverse effect on these bonds.
Transportation bonds are obligations of issuers that own and operate public
transit systems, ports, highways, turnpikes, bridges and other transportation
systems. The ability of these issuers to make payments on these bonds depends
on variations in use, the degree of government subsidization, competition from
other forms of transportation and increased costs. Port authorities derive
revenues primarily from fees imposed on ships using the port facilities. These
fees can fluctuate depending on the local economy and competition from air,
rail and truck transportation. Increased fuel costs, alternative transportation
modes and competition from toll-free bridges and roads will impact revenues of
issuers that operate bridges, roads or tunnels.
Waste disposal bonds are obligations of issuers that derive revenues from
resource recovery facilities. These facilities process solid waste, generate
steam and convert steam to electricity. These issuers face problems such as
costs and delays due to environmental concerns, effects of conservation and
recycling, destruction or condemnation of a project, void or unenforceable
contracts, changes in the economic availability of raw materials, operating
supplies or facilities, and other unavoidable changes that adversely affect
operation of a project.
Water and sewer bonds are obligations of issuers that derive revenues from
user fees from the sale of water and sewerage services. These issuers face
problems such as the ability to obtain rate increases, population declines,
difficulties in obtaining new fresh water supplies and "no-growth" zoning
ordinances. These issuers also face many of the same problems of waste disposal
issuers.
Wholesale electric bonds are obligations of issuers that derive revenues
from selling electricity to other utilities. The ability of these issuers to
make payments on these bonds depends on factors such as the rates and demand
for electric utilities, competition, overhead expenses and government
regulation and rate approvals.
More About the Bonds. In addition to describing the purpose of the bonds,
other information about the bonds is also included in the "Portfolio" and notes
thereto. This information relates to other characteristics of the bonds. This
section briefly describes some of these characteristics.
Original issue discount bonds were initially issued at a price below their
face (or par) value. These bonds typically pay a lower interest rate than
comparable bonds that were issued at or above their par value. In a stable
interest rate environment, the market value of these bonds tends to increase
more slowly in early years and in greater increments as the bonds approach
maturity. The issuers of these bonds may be able to call or redeem a bond
before its stated maturity date and at a price less than the bond's par value.
Zero coupon bonds are a type of original issue discount bond. These bonds do
not pay any current interest during their life. If an investor owns this type
of bond, the investor has the right to receive a final payment of the bond's
par value at maturity. The price of these bonds often fluctuates greatly during
periods of changing market interest rates compared to bonds that make current
interest payments. The issuers of these bonds may be able to call or redeem a
bond before its stated maturity date and at a price less than the bond's par
value.
"When, as and if issued" bonds are bonds that trade before they are actually
issued. This means that the Sponsor can only deliver them to your Trust "when,
as and if" the bonds are actually issued. Delivery of these bonds may be
delayed or may not occur. Interest on these bonds does not begin accruing to
your Trust until the Sponsor delivers the bond to the Trust. You may have to
adjust your tax basis if the Sponsor delivers any of these bonds after the
expected delivery date. Any adjustment would reflect interest that accrued
between the time you purchased your Units and the delivery of the bonds to your
Trust. This could lower your first year estimated current return. You may
experience gains or losses on these bonds from the time you purchase Units even
though your Trust has not yet received them.
In order to acquire certain bonds, it may be necessary for the Sponsor or
Trustee to pay amounts covering accrued interest on the bonds which exceed the
amounts which will be made available through cash furnished by the Sponsor on
the Date of Deposit. This cash may exceed the interest which would accrue to
the First Settlement Date. The Trustee has agreed to pay for any amounts
necessary to cover any excess and will be reimbursed when funds become
available from interest payments on the related bonds. Also, since interest on
any "when, as and if issued" bonds does not begin accruing as tax-exempt
interest income to the benefit of Unitholders until the date of delivery, the
Trustee may reduce its fee and pay Trust expenses in order to maintain or
approach the same estimated net annual interest income during the first year of
the Trust's operations as described under "Summary of Essential Financial
Information".
Municipal Bond Risk Factors. All investments involve risk. This section
describes the main risks that can impact the value of bonds in your Trust. You
should understand these risks before you invest. If the value of the bonds
falls, the value of your Units will also fall. You can lose money by investing
in a Trust. No one can guarantee that your Trust will achieve its objective or
that your investment return will be positive over any period. The Information
Supplement contains a more detailed discussion of risks related to your
investment.
Current economic conditions. The economic recession in the United States
which began in 2007 technically came to an end in June of 2009, however the U.S.
and global economies continue to feel the effects of this recessionary period,
including increased unemployment and below-average levels of economic activity.
The U.S. and other foreign governments have taken extraordinary steps to combat
the effects of the economic crisis, however the ultimate impact of these
measures is unknown and cannot be predicted. In December of 2013, the U.S.
Federal Reserve announced it would begin tapering its quantitative easing
program, however, there continues to be uncertainty concerning potential future
changes to the federal funds rate following a period of near zero interest rates
over the previous five years. On August 5, 2011, Standard & Poor's Rating
Services downgraded the long-term sovereign credit rating of the United States
of America to AA+ from AAA, citing the prolonged controversy over raising the
statutory debt ceiling and the related fiscal policy debate. Any substantial
change in general market conditions may result in sudden and significant
valuation increases or declines in your Trust's holdings.
Market risk is the risk that the value of the bonds in your Trust will
fluctuate. This could cause the value of your Units to fall below your original
purchase price or below the par value. Market value fluctuates in response to
various factors. These can include changes in interest rates, inflation, the
financial condition of a bond's issuer or insurer, perceptions of the issuer or
insurer, or ratings on a bond. Even though the Supervisor supervises your
portfolio, you should remember that no one manages your portfolio. Your Trust
will not sell a bond solely because the market value falls as is possible in a
managed fund.
Interest rate risk is the risk that the value of bonds will fall if interest
rates increase. Bonds typically fall in value when interest rates rise and rise
in value when interest rates fall. Bonds with longer periods before maturity are
often more sensitive to interest rate changes. Interest rates in the United
States are at or near historic lows, which may increase the Trust's exposure to
risks associated with rising interest rates.
Credit risk is the risk that a bond's issuer or insurer is unable to meet
its obligation to pay principal or interest on the bond.
Call risk is the risk that the issuer prepays or "calls" a bond before its
stated maturity. An issuer might call a bond if interest rates fall and the bond
pays a higher interest rate or if it no longer needs the money for the original
purpose. If an issuer calls a bond, your Trust will distribute the principal to
you but your future interest distributions will fall. You might not be able to
reinvest this principal at as high a yield. A bond's call price could be less
than the price your Trust paid for the bond and could be below the bond's par
value. This means that you could receive less than the amount you paid for your
Units. If enough bonds in your Trust are called, your Trust could terminate
early. The first date that the issuer can call each bond is listed under
"Portfolio" along with the price the issuer would have to pay. Some or all of
the bonds may also be subject to extraordinary optional or mandatory redemptions
if certain events occur, such as certain changes in tax laws, the substantial
damage or destruction by fire or other casualty of the project for which the
proceeds of the bonds were used, and various other events. The call provisions
are described in general terms in the "Redemption Feature" column of the
"Portfolio" section and the notes thereto. Additional discussion of call
provisions appears in the Information Supplement.
Bond quality risk is the risk that a bond will fall in value if a rating
agency decreases the bond's rating.
Bond concentration risk is the risk that your Trust is less diversified
because it concentrates in a particular type of bond. When a certain type of
bond makes up 25% or more of a Trust, the Trust is considered to be
"concentrated" in that bond type. The different bond types are described under
"The Bonds".
Reduced diversification risk is the risk that your Trust will become smaller
and less diversified as bonds are sold, are called or mature. This could
increase your risk of loss and increase your share of Trust expenses.
Insurer default risk is the risk that an investor of an insured trust could
lose income and/or principal if the issuer and the insurer of a municipal bond
both default in making their payment obligations.
Liquidity risk is the risk that the value of a bond will fall if trading in
the bond is limited or absent. No one can guarantee that a liquid trading
market will exist for any bond because these bonds generally trade in the
over-the-counter market (they are not listed on a securities exchange).
Litigation and legislation risk is the risk that future litigation or
legislation could affect the value of your Trust. For example, future
legislation could reduce tax rates, impose a flat tax, exempt all investment
income from tax or change the tax status of the bonds. Litigation could
challenge an issuer's authority to issue or make payments on bonds.
State Risk Factors. Your Trust may invest significantly in tax-exempt
municipal bonds of issuers from a particular state. The financial condition of
a state may be affected by various national, economic, social and environmental
policies and conditions. Additionally, limitations imposed by constitutional
amendments, legislative measures, or voter initiatives on a state and its local
governments concerning taxes, bond indebtedness and other matters may constrain
the revenue-generating capacity of the state and its local governments and,
therefore, the ability of the issuers of the bonds to satisfy their
obligations.
The economic vitality of a state and its various regions and, therefore, the
ability of the state and its local governments to satisfy the bonds, are
affected by numerous factors, such as natural disasters, complications with
exports and industry deregulation.
A state may be a party to numerous lawsuits in which an adverse final
decision could materially affect the state's governmental operations and
consequently its ability to pay debt service on its obligations.
No FDIC Guarantee. An investment in your Trust is not a deposit of any bank
and is not insured or guaranteed by the Federal Deposit Insurance Corporation
or any other government agency.
ESTIMATED CURRENT AND LONG-TERM RETURNS
--------------------------------------------------------------------------------
The Estimated Current Return and the Estimated Long-Term Return as of the
Date of Deposit are set forth on the cover of the prospectus. Estimated Current
Return is calculated by dividing the estimated net annual interest income per
Unit by the Public Offering Price. The estimated net annual interest income per
Unit will vary with changes in fees and expenses of the Trust and with the
principal prepayment, default (if any), redemption, maturity, exchange or sale
of bonds. The Public Offering Price will vary with changes in the price of the
bonds. Accordingly, there is no assurance that the present Estimated Current
Return will be realized in the future. Estimated Long-Term Return is calculated
using a formula which (1) takes into consideration, and determines and factors
in the relative weightings of, the market values, yields (which takes into
account the amortization of premiums and the accretion of discounts) and
estimated retirements of the bonds and (2) takes into account the expenses and
sales charge associated with Units. Since the value and estimated retirements of
the bonds and the expenses of a Trust will change, there is no assurance that
the present Estimated Long-Term Return will be realized in the future. The
Estimated Current Return and Estimated Long-Term Return are expected to differ
because the calculation of Estimated Long-Term Return reflects the estimated
dates and amounts of principal returned on the bonds while the Estimated Current
Return calculation includes only net annual interest income and Public Offering
Price.
PUBLIC OFFERING
--------------------------------------------------------------------------------
General. Units are offered at the Public Offering Price. During the initial
offering period the Public Offering Price is based on the aggregate offering
price of the bonds, the sales charge described below, cash, if any, in the
Principal Account (including cash to pay organization costs) and accrued
interest, if any. Organization costs are not included in the Public Offering
Price per Unit for purposes of calculating the sales charge.
If you purchase Units during the initial offering period of a Trust with a
deferred sales charge, your sales charge will consist of (i) an initial sales
charge paid upon the purchase of your Units and (ii) the remaining deferred
sales charge, which consists of a fixed dollar amount per Unit paid in
installments on specified deferred sales charge payment dates. In no event will
your combined initial sales charge and deferred sales charge exceed the maximum
percentage sales charge for the applicable Trust as set forth above. For more
details, including the specific amount and method of calculation of the initial
and deferred sales charge, for those Trusts which offer a deferred sales
charge, see the "Fee Table" in prospectus of the applicable Trust.
After the initial public offering period, the secondary market Public
Offering Price is based on the bid prices of the bonds, the sales charge
described below, cash, if any, in the Principal Account and accrued interest,
if any. The actual sales charge that may be paid by an investor may differ
slightly from the sales charges shown herein due to rounding that occurs in the
calculation of the Public Offering Price and in the number of Units purchased.
The minimum purchase in the primary and secondary market is one Unit. Certain
broker-dealers or selling firms may charge an order handling fee for processing
Unit purchases.
The maximum initial offering period sales charge for Intermediate-Term
Trusts is equal to 3.00% of the Public Offering Price per Unit (3.093% of the
aggregate offering price of the bonds). The maximum secondary market sales
charge is computed as described in the following table based upon the estimated
long-term return life in years ("ELTR Life") of a Trust's portfolio:
ELTR Life (Years) Sales Charge
--------------------------------
Less than 2 1.50%
2 but less than 4 2.00
4 but less than 6 3.00
6 but less than 8 3.50
8 but less than 11 4.00
11 but less than 15 4.50
15 and over 4.80
The ELTR Life represents the estimated life of the bonds in a Trust's
portfolio as determined for purposes of calculating Estimated Long-Term Return.
See "Estimated Current and Long-Term Returns". The sales charges in the above
table are expressed as a percentage of the secondary market Public Offering
Price per Unit. For example, the maximum secondary market sales charge for a
Trust with an ELTR Life of "6 but less than 8" years would be 3.50% of the
Public Offering Price per Unit (3.630% of the aggregate bid price of the
bonds).
If you purchase Units in the secondary market of a Trust with a deferred
sales charge, your maximum sales charge will be based on the remaining ELTR
Life of the Trust as described above and will consist of an initial sales
charge and the remaining deferred sales charge, if any. If the secondary market
Units are purchased prior to the final deferred sales charge payment date, the
initial sales charge, which you pay at the time of purchase, is the difference
between the secondary market sales charge based on the ELTR Life listed above
and the maximum remaining deferred sales charge. If you purchase Units after
the last deferred sales charge payment has been assessed, your maximum sales
charge will consist of the one time initial sales charge based on the ELTR
Life.
Reducing Your Sales Charge. The Sponsor offers a variety of ways for you to
reduce the sales charge that you pay. It is your financial professional's
responsibility to alert the Sponsor of any discount when you purchase Units.
Before you purchase Units you must also inform your broker-dealer of your
qualification for any discount or of any combined purchases to be eligible for a
reduced sales charge. As further described in this section, purchases executed
on the same day by a single person at the same broker-dealer may be combined for
sales charge discount calculation purposes. Secondary market purchases are
excluded for purposes of sales charge discount calculations.
For Trusts with a deferred sales charge, these charges are fixed dollar
amounts per Unit, and your Trust must charge these amounts per Unit regardless
of any discounts. However, if you are eligible to receive a discount such that
your total sales charge is less than the fixed dollar amounts of the deferred
sales charges, you will receive a credit equal to the difference between your
total sales charge and these fixed dollar charges at the time you buy Units.
Large Quantity Purchases. You can reduce your sales charge by increasing the
size of your investment. Based upon the aggregate dollar amount of Units
purchased by a Unitholder in the initial offering period, the following table
shows both the corresponding sales charge and the concession or agency
commission allowed to broker-dealers and other selling agents on such
transaction.
Broker-Dealer
Sales Charge for Concession or
Intermediate-Term Agency
Transaction Amount Trusts Commission
----------------------------------------------------------
Less than $100,000 3.00% 2.10%
$100,000 - $249,999 2.60 1.80
$250,000 - $499,999 2.40 1.70
$500,000 - $999,999 2.20 1.50
$1,000,000 - $2,999,999 2.00 1.30
$3,000,000 - $4,999,999 1.70 1.10
$5,000,000 or more 1.50 0.90
Except as described below, these quantity discount levels apply only to
purchases of a single Trust made by the same person on a single day from a
single broker-dealer. Additional information regarding the broker-dealer
concession or agency commission is presented in the "Unit Distribution"
section.
Aggregated Purchases--For purposes of achieving these levels, you may
combine certain purchases made on the same day through a single broker-dealer
or selling agent, as further described below. You must inform your
broker-dealer of any combined purchases before your purchase to be eligible for
a reduced sales charge. For purposes of achieving the quantity discount levels
in the above table, Units of a Trust offered in this prospectus may be combined
with (i) purchases of units of any other Invesco-sponsored unit investment
trusts during each trust's initial offering period, (ii) purchases of units
made as described under the "Fee Accounts" paragraph in this section, and (iii)
purchases of units eligible for the sales charge discounts described under the
"Exchanges" paragraph in this section. In addition, Units purchased in the name
of your spouse (or the equivalent if recognized under local law) or children
(including step-children) under 21 living in the same household as you will be
deemed to be additional purchases by you for the purposes of calculating the
applicable quantity discount level. The reduced sales charge levels will also
be applicable to a trustee or other fiduciary purchasing Units for a single
trust, estate (including multiple trusts created under a single estate) or
fiduciary account.
Fee Accounts. A portion of the sales charge is waived for certain accounts
described in this paragraph. Purchases by these accounts are subject only to the
portion of the sales charge that is retained by the Sponsor. Please refer to the
section called "Fee Accounts" for additional information on these purchases.
Units may be purchased in the initial offering period at the Public Offering
Price less the maximum applicable concession the Sponsor typically allows to
brokers and dealers (either non-Underwriter or Underwriter concession, whichever
is greater) for purchases by investors who purchase Units through registered
investment advisers, certified financial planners and registered broker-dealers
who in each case either charge periodic fees for brokerage services, financial
planning, investment advisory or asset management services, or provide such
services in connection with the establishment of an investment account for which
a comprehensive "wrap fee" charge ("Wrap Fee") is imposed ("Fee Accounts") if
the Units are purchased for a Fee Account and the Trust is subject to a Wrap Fee
(i.e. the Trust is "Wrap Fee Eligible"). For example, with respect to an
Intermediate-Term Trust, Wrap Fee Eligible purchasers would pay a sales charge
of only 0.65%, which represents the maximum sales charge of 3.00% minus the
maximum applicable concession of 2.35%. The Sponsor reserves the right to limit
or deny purchases of Units described in this paragraph by investors or selling
firms whose frequent trading activity is determined to be detrimental to a
Trust. As described above in "Large Quantity Purchases", Units purchased for a
Fee Account may be combined with certain other purchases for purposes of
achieving the quantity discount levels presented in the table above under "Large
Quantity Purchases", however, such Wrap Fee Eligible Units are not eligible for
any sales charge discounts in addition to that which is described in this
paragraph and under the "Fee Accounts" section found below.
Exchanges. During the initial offering period of a Trust, unitholders of any
Invesco-sponsored unit investment trust and unitholders of unaffiliated unit
investment trusts may utilize their redemption or termination proceeds from
such trusts to purchase Units of an Intermediate-Term Trust, or units of any
other Invesco-sponsored unit investment trust in its initial offering period,
at a reduced sales charge. For such purchases of less than $3,000,000, the
sales charge will be reduced by 1.00% for Units of an Intermediate-Term Trust.
For purchases of $3,000,000 or more, either made solely with redemption or
termination proceeds from other unit investment trusts or in combination with
other purchases as described above under "Large Quantity Purchases",
Intermediate-Term Trust Units will be eligible for the applicable quantity
discount level presented in the table that appears in that subsection. For
aggregated purchases described above in the "Large Quantity Purchases"
subsection that consist of any units other than Intermediate-Term Trust Units,
please refer to the prospectus of the applicable Invesco-sponsored unit
investment trust for information regarding the specified sales charge
reductions on those units. In order to be eligible for the sales charge
discounts applicable to Unit purchases made with redemption or termination
proceeds from other unit investment trusts, the trade date of each rollover or
redemption, or each other trust's termination date resulting in the receipt of
such proceeds used to purchase Units of the Trust must all be derived from
transactions that occurred within 30 calendar days prior to your Unit purchase.
In addition, the discounts will only be available for investors that utilize
the same broker-dealer (or a different broker-dealer with appropriate
notification) for both the Unit purchase and the transaction resulting in the
receipt of the termination or redemption proceeds used for the Unit purchase.
You may be required to provide appropriate documentation or other information
to your broker-dealer to evidence your eligibility for these reduced sales
charge discounts. An exchange does not avoid a taxable event on the redemption
or termination of an interest in a Trust.
Employees. Employees, officers and directors (including their spouses (or
the equivalent if recognized under local law) and children or step-children
under 21 living in the same household, parents or step-parents and trustees,
custodians or fiduciaries for the benefit of such persons (collectively
referred to herein as "related purchasers")) of Invesco Capital Markets, Inc.
and its affiliates and, when permitted, Underwriters and their affiliates may
purchase Units at the Public Offering Price less the applicable underwriting
commission or less the applicable dealer concession in the absence of an
underwriting commission. Employees, officers and directors (including related
purchasers) of dealers and their affiliates may purchase Units at the Public
Offering Price less the applicable dealer concession. All employee discounts
are subject to the policies of the related selling firm. Only employees,
officers and directors of companies that allow their employees to participate
in this employee discount program are eligible for the discounts.
Unit Price. The Public Offering Price of Units will vary from the amounts
stated under "Summary of Essential Financial Information" in accordance with
fluctuations in the prices of the bonds. The price of Units as of the opening of
business on the Date of Deposit was determined by adding the applicable sales
charge and organization costs to the aggregate offering price of the bonds and
dividing the sum by the number of Units outstanding. This price determination
was made on the basis of an evaluation of the bonds prepared by the Evaluator.
During the initial offering period, the Evaluator will value the bonds as of the
Evaluation Time on days the New York Stock Exchange is open for business and
will adjust the Public Offering Price of Units accordingly. The "Evaluation
Time" is the close of trading on the New York Stock Exchange on each day that
the Exchange is open for regular trading, or earlier on days where the Bond
Market Association recommends an early bond market close, provided, however, on
the Date of Deposit the "Evaluation Time" will be the close of regular trading
on the New York Stock Exchange or the time the registration statement filed with
the Securities and Exchange Commission (the "SEC") becomes effective, if later.
The secondary market Public Offering Price per Unit will be equal to the
aggregate bid price of the bonds plus the applicable secondary market sales
charge and dividing the sum by the number of Units outstanding. For secondary
market purposes, this computation will be made by the Evaluator as of the
Evaluation Time for each day on which any Unit is tendered for redemption and as
necessary. The offering price of bonds may be expected to range approximately
from 0.125% to 1.375% more than the bid price.
The Public Offering Price per Unit will be effective for all orders received
prior to the Evaluation Time on each business day. Orders received by the
Sponsor prior to the Evaluation Time and orders received by authorized
financial professionals prior to the Evaluation Time that are properly
transmitted to the Sponsor by the time designated by the Sponsor, are priced
based on the date of receipt. Orders received by the Sponsor after the
Evaluation Time, and orders received by authorized financial professionals
after the Evaluation Time or orders received by such persons that are not
transmitted to the Sponsor until after the time designated by the Sponsor, are
priced based on the date of the next determined Public Offering Price per Unit
provided they are received timely by the Sponsor on such date. It is the
responsibility of authorized financial professionals to transmit orders
received by them to the Sponsor so they will be received in a timely manner.
The aggregate price of the bonds is determined on the basis of bid prices or
offering prices, as is appropriate, (a) on the basis of current market prices
obtained from dealers or brokers who customarily deal in bonds comparable to
those held by the Trusts; (b) if these prices are not available, on the basis
of current market prices for comparable bonds; (c) by causing the value of the
bonds to be determined by others engaged in the practice of evaluation, quoting
or appraising comparable bonds; or (d) by any combination of the above. Market
prices of the bonds will generally fluctuate with changes in market interest
rates.
A person will become the owner of Units on the date of settlement provided
payment has been received. Cash, if any, made available to the Sponsor prior to
the date of settlement for the purchase of Units may be used in the Sponsor's
business and may be deemed to be a benefit to the Sponsor, subject to the
limitations of the Securities Exchange Act of 1934.
Organization Costs. During the initial offering period, part of the Public
Offering Price represents an amount of cash deposited to pay the estimated
costs incurred in establishing your Trust. These costs include the costs of
preparing documents relating to the Trust (such as the registration statement,
prospectus, trust agreement and legal documents), federal and state
registration fees, the initial fees and expenses of the Trustee and the initial
audit. Your Trust will reimburse us for these costs at the end of the initial
offering period or after six months, if earlier. The value of your Units will
decline when the Trust deducts these costs from the Trust assets.
Accrued Interest. Accrued interest is an accumulation of unpaid interest on
securities which generally is paid by the bonds semi-annually, although each
Trust accrues interest daily. Because of this, a Trust always has an amount of
interest earned but not yet collected by the Trustee. For this reason, with
respect to sales settling after the First Settlement Date, the proportionate
share of accrued interest to the settlement date is added to the Public
Offering Price of Units. You will receive the amount of accrued interest paid
on your Units on the next distribution date. In an effort to reduce the accrued
interest which would have to be paid by Unitholders, the Trustee will advance
the amount of accrued interest to the Sponsor as the Unitholder of record as of
the First Settlement Date. Consequently, the accrued interest added to the
Public Offering Price of Units will include only accrued interest from the
First Settlement Date to the date of settlement, less any distributions from
the Interest Account after the First Settlement Date. Because of the varying
interest payment dates of the bonds, accrued interest at any point in time will
be greater than the amount of interest actually received by a Trust and
distributed to Unitholders. If you sell or redeem all or a portion of your
Units, you will be entitled to receive your proportionate share of the accrued
interest from the purchaser of your Units.
Unit Distribution. Units will be distributed to the public by Underwriters,
broker-dealers and others at the Public Offering Price, plus accrued interest.
The Sponsor intends to qualify Units for sale in a number of states.
Intermediate-Term Trust Concessions. During the initial offering period, the
Sponsor and Underwriters will sell Units of Intermediate-Term Trusts to
non-Underwriter broker-dealers and selling agents at the Public Offering Price
(net of any sales charge discount) less the applicable gross concession or
agency commission set forth in the "Broker-Dealer Concession or Agency
Commission" column of the table under "Reducing Your Sales Charge -- Large
Quantity Purchases". These breakpoints will be adjusted to take into
consideration purchase orders stated in dollars which cannot be completely
fulfilled due to the requirement that only whole Units be issued.
For initial offering period transactions involving unitholders of other unit
investment trusts who use their redemption or termination proceeds to purchase
Units of an Intermediate-Term Trust, the regular concession or agency
commission allowed by the Sponsor to broker-dealers and other selling agents
will amount to 1.30% for aggregated purchases of less than $3,000,000. For such
aggregated purchases of $3,000,000 or more, the regular concession or agency
commission will correspond to the amounts listed in the "Broker-Dealer
Concession or Agency Commission" column of the table under "Reducing Your Sales
Charge -- Large Quantity Purchases".
Underwriters other than the Sponsor will sell Units to other broker-dealers
and selling agents at the Public Offering Price less a concession or agency
commission not in excess of the maximum concession allowed to Underwriters by
the Sponsor as described under "Sponsor and Underwriter Compensation" below.
Following the end of the initial offering period, any broker-dealer or other
selling agent who is not a Qualifying Broker-Dealer (as described below) will
be entitled to receive an additional per Unit concession based on the following
table corresponding to the aggregate number of Trust Units purchased from the
Sponsor as of the end of the initial offering period.
Aggregate Number of Units Additional
Purchased from the Sponsor Concession
--------------------------------------
250 - 999 Units 0.10%
1,000 Units - 2,999 Units 0.20%
3,000 Units or more 0.25%
Notwithstanding the concession amounts presented in the "Broker-Dealer
Concession or Agency Commission" column of the table under "Reducing Your Sales
Charge -- Large Quantity Purchases", broker-dealers and other selling agents
who have not acted as Underwriters for the Trust that purchase 250 or more
Units of a Trust from the Sponsor on the Date of Deposit ("Qualifying
Broker-Dealers") will be allowed a concession or agency commission on all Units
of a Trust purchased from the Sponsor throughout the initial offering period
equal to the regular concession allowed to Underwriters described under
"Sponsor and Underwriter Compensation" below. Further, Qualifying
Broker-Dealers not receiving the maximum concession amount per Unit on the Date
of Deposit may be eligible to receive an additional per Unit concession based
upon the aggregate number of Trust Units purchased from the Sponsor as of the
end of the initial offering period. Qualifying Broker Dealers having purchased
less than 1,000 Units of the Trust from the Sponsor on the Date of Deposit will
be entitled to an additional concession of 0.10% if the aggregate number of
Trust Units purchased from the Sponsor as of the end of the initial offering
period totals at least 1,000 Units but less than 3,000 Units, or an additional
concession of 0.15% for totals of at least 3,000 Units. Qualifying Broker
Dealers having purchased at least 1,000 Units but less than 3,000 Units of the
Trust from the Sponsor on the Date of Deposit will be entitled to an additional
concession of 0.05% if the aggregate number of Trust Units purchased from the
Sponsor as of the end of the initial offering period totals at least 3,000
Units.
Regarding the additional per Unit concessions described above for both
Qualifying Broker Dealers and for other broker-dealers or selling agents, these
additional concessions will also be applied on a dollar basis utilizing an
equivalent of $1,000 per Unit and will be applied on whichever basis is more
favorable to the dealer firm or selling agent. Purchase orders stated in dollars
which cannot be completely fulfilled due to the requirement that only whole
Units be issued will be subject to the concession amount corresponding to the
dollar amount of the purchase order, utilizing a $1,000 per Unit equivalent.
Concessions Based Upon Annual Sales. As described below, broker-dealers and
other selling agents may in certain cases be eligible for additional
concessions based upon their annual eligible sales of all Invesco fixed income
and equity unit investment trusts. Eligible sales include all units of any
Invesco unit investment trust underwritten or purchased directly from Invesco
during a trust's initial offering period. For purposes of the Volume Concession
described below, trusts designated as either "Invesco Unit Trusts, Taxable
Income Series" or "Invesco Unit Trusts, Municipal Series" are fixed income
trusts, and trusts designated as "Invesco Unit Trusts Series" are equity
trusts.
Volume Concession--In addition to the concessions or agency commissions
described above, all broker-dealers and other selling firms (including
Underwriters) will be eligible to receive additional compensation based on total
initial offering period sales of all eligible Invesco unit investment trusts
during the previous consecutive 12-month period through the end of the most
recent month. The Volume Concession, as applicable to equity and fixed income
trust units, is set forth in the following table:
Volume Concession
-------------------------
Total Sales Equity Trust Fixed Income
(in millions) Units Trust Units
-------------------------------------------------------
$25 but less than $100 0.050% 0.050%
$100 but less than $150 0.075 0.075
$150 but less than $250 0.100 0.100
$250 but less than $500 0.115 0.100
$500 but less than $750 0.125 0.100
$750 but less than $1,000 0.130 0.100
$1,000 but less than $1,500 0.135 0.100
$1,500 but less than $2,000 0.140 0.100
$2,000 but less than $3,000 0.150 0.100
$3,000 but less than $4,000 0.160 0.100
$4,000 but less than $5,000 0.170 0.100
$5,000 or more 0.175 0.100
Broker-dealers and other selling firms will not receive the Volume
Concession on the sale of units purchased in Fee Accounts, however, such sales
will be included in determining whether a firm has met the sales level
breakpoints set forth in the Volume Concession table above. Secondary market
sales of all unit investment trusts are excluded for purposes of the Volume
Concession. Eligible dealer firms and other selling agents include clearing
firms that place orders with Invesco and provide Invesco with information with
respect to the representatives who initiated such transactions. Eligible dealer
firms and other selling agents will not include firms that solely provide
clearing services to other broker-dealer firms or firms who place orders
through clearing firms that are eligible dealers. We reserve the right to
change the amount of the concessions or agency commissions from time to time.
For a trust to be eligible for this additional compensation, the trust's
prospectus must include disclosure related to this additional compensation.
Additional Volume Concession Eligibility -- Underwriters, broker-dealers or
other selling firms having achieved $500 million in total eligible sales for the
previous 12 month period through the end of the most recent month are eligible
to receive an additional volume concession for each Trust Unit underwritten or
purchased directly from the Sponsor on the Initial Date of Deposit equal to the
difference between the maximum allowable concession described under "Sponsor and
Underwriter Compensation" and the per Unit concession applicable to each Trust
Unit underwritten or purchased. Only Units acquired on the Date of Deposit may
qualify for this additional per Unit volume concession, and Unit acquisitions
made on subsequent days will be subject to the applicable levels as stated in
the "Unit Distribution" and "Sponsor and Underwriter Compensation" sections.
This additional per Unit volume concession will be payable either at the time
the Units are acquired or following the end of the initial offering period, at
the election of the recipient. With respect to any Units for which an
Underwriter, broker-dealer or other selling firm receives this additional per
Unit volume concession, such Units will not be eligible for additional per Unit
concessions described under "Intermediate-Term Trust Concessions."
Additional Information. Certain commercial banks may be making Units
available to their customers on an agency basis. A portion of the sales charge
paid by these customers (equal to the agency commission referred to above) is
retained by or remitted to the banks. Any discount provided to investors will
be borne by the selling dealer or agent. For secondary market transactions, the
Sponsor will sell Units to broker-dealers and selling agents at the Public
Offering Price less a concession or agency commission of 80% of the applicable
sales charge. Dealers other than the Sponsor may sell Units in the secondary
market to other broker-dealers and selling agents at the Public Offering Price
less a concession or agency commission not in excess of the secondary market
concession allowed to the dealer. Notwithstanding anything to the contrary
herein, in no case shall the total of any concessions, agency commissions and
any additional compensation allowed or paid to any broker, dealer or other
distributor of Units with respect to any individual transaction exceed the
maximum sales charge applicable to Intermediate-Term Trusts. The Sponsor
reserves the right to reject, in whole or in part, any order for the purchase
of Units and to change the amount of the concession or agency commission to
dealers and others from time to time.
Sponsor and Underwriter Compensation. The Sponsor will sell Units to
Underwriters at the regular Public Offering Price per Unit less a gross
concession described in the sections below. For a list of the Underwriters that
have purchased Units from the Sponsor, see "Underwriting".
The Sponsor will sell Units of Intermediate-Term Trusts to Underwriters at
the regular Public Offering Price per Unit less the concession per Unit
underwritten set forth in the following table.
Underwriter
Units Concession
-------------------------------------
250 - 999 Units 2.20%
1,000 Units - 2,999 Units 2.30%
3,000 Units or more 2.35%
An Underwriter will be allowed a concession throughout the initial offering
period of a Trust equal to the Underwriter concession allowed to such firm on
the Date of Deposit for Units subsequently purchased from the Sponsor. At the
end of the initial offering period, an Underwriter not receiving the maximum
concession amount per Unit on the Date of Deposit may be eligible to receive an
additional per Unit concession based upon the aggregate number of Trust Units
underwritten and subsequently purchased from the Sponsor as of the end of the
initial offering period. Underwriters having underwritten less than 1,000 Units
of the Trust will be entitled to an additional concession of 0.10% if the
aggregate number of Trust Units underwritten and subsequently purchased from
the Sponsor as of the end of the initial offering period totals at least 1,000
Units but less than 3,000 Units, or an additional concession of 0.15% for
totals of at least 3,000 Units. Underwriters having underwritten at least 1,000
Units but less than 3,000 Units of the Trust will be entitled to an additional
concession of 0.05% if the aggregate number of Trust Units underwritten and
subsequently purchased from the Sponsor as of the end of the initial offering
period totals at least 3,000 Units.
The concessions for a) Units underwritten on the Date of Deposit, b) Units
purchased from the Sponsor by an Underwriter subsequent to the Date of Deposit
during a Trust's initial offering period, and c) the additional per Unit
concession for Underwriters will each also be applied on a dollar basis
utilizing an equivalent of $1,000 per Unit and will be applied on whichever
basis is more favorable to the Underwriter. Purchase orders stated in dollars
which cannot be completely fulfilled due to the requirement that only whole
Units be issued will be subject to the concession amount corresponding to the
stated dollar amount of the purchase order, utilizing a $1,000 per Unit
equivalent.
Any Underwriter which has achieved $500 million in total eligible sales for
the previous 12 month period through the end of the most recent month will be
eligible to receive an additional per Unit volume concession as described under
"Unit Distribution--Concessions Based Upon Annual Sales--Additional Volume
Concession Eligibility".
In connection with Underwriter sales of Units to non-Underwriter
broker-dealers and other selling agents which Units in turn are sold to
investors in sufficient size to qualify for quantity discounts, in certain
instances, the sum of the sales charge discount and the broker-dealer
concession may exceed the concession allowed to the Underwriter. At the request
of the Underwriter, the Sponsor may repurchase such Units at the Public
Offering Price per Unit less the concession amount allowed to the Underwriter
during the Trust's initial offering period, and subsequently resell those Units
back to the Underwriter at the Public Offering Price per Unit less the
applicable sales charge reduction per Unit and broker-dealer concession amounts
listed in the table found under "Public Offering--Reducing Your Sales
Charge--Large Quantity Purchases".
In addition, the Sponsor and certain Underwriters will realize a profit or
loss, as a result of the difference between the price paid for the bonds by the
Sponsor and the cost of the bonds to a Trust. See "Portfolio" and "Notes to
Portfolio". The Sponsor and the Underwriters may also realize profits or losses
with respect to bonds which were acquired by the Sponsor from underwriting
syndicates of which they were members. The Sponsor has not participated as sole
underwriter or as manager or as a member of the underwriting syndicates from
which the bonds were acquired. Underwriters may further realize profit or loss
during the initial offering period as a result of possible fluctuations in the
market value of the bonds since all proceeds received from purchasers of Units
(excluding dealer concessions or agency commissions allowed, if any) will be
retained by the Underwriters. Affiliates of an Underwriter are entitled to the
same dealer concessions or agency commissions that are available to the
Underwriter. In addition to any other benefits Underwriters may realize from the
sale of Units, the Sponsor will share with certain Underwriters a portion of any
gain represented by the difference between the cost of the bonds to the Sponsor
and the evaluation of the bonds on the Date of Deposit (less deductions for
accrued interest and certain costs). For Underwriters who either (a) underwrite
at least 3,000 Units or (b) submit an Underwriter purchase order of at least
$3,000,000, the Sponsor will share 50% of that portion of the gain that relates
to the Units actually underwritten by such Underwriters. For those Underwriters
who either (a) underwrite at least 1,000 Units but less than 3,000 Units or (b)
submit an Underwriter purchase order of at least $1,000,000 but less than
$3,000,000, the Sponsor will share 25% of that portion of the gain that relates
to the Units actually underwritten by such Underwriters. The Sponsor and certain
of the other Underwriters will also realize profits or losses in the amount of
any difference between the price at which Units are purchased and the price at
which Units are resold in connection with maintaining a secondary market for
Units and will also realize profits or losses resulting from a redemption of
repurchased Units at a price above or below the purchase price.
We may provide, at our own expense and out of our own profits, additional
compensation and benefits to broker-dealers who sell Units of Trusts and our
other products. This compensation is intended to result in additional sales of
our products and/or compensate broker-dealers and financial advisers for past
sales. We may make these payments for marketing, promotional or related
expenses, including, but not limited to, expenses of entertaining retail
customers and financial advisers, advertising, sponsorship of events or
seminars, obtaining shelf space in broker-dealer firms and similar activities
designed to promote the sale of Trusts and our other products. Fees may include
payment for travel expenses, including lodging, incurred in connection with
trips taken by invited registered representatives for meetings or seminars of a
business nature. These arrangements will not change the price you pay for your
Units.
Market for Units. Although not obligated to do so, the Sponsor intends to,
and certain of the other Underwriters may, maintain a market for Units and
offer to purchase Units at prices, subject to change at any time, based upon
the aggregate bid prices of the bonds plus accrued interest and any principal
cash on hand, less any amounts representing taxes or other governmental charges
payable out of the Trust and less any accrued Trust expenses. If the supply of
Units exceeds demand or if some other business reason warrants it, the Sponsor
and/or the Underwriters may either discontinue all purchases of Units or
discontinue purchases of Units at these prices. If a market is not maintained
and the Unitholder cannot find another purchaser, a Unitholder will be able to
dispose of Units by tendering them to the Trustee for redemption at the
Redemption Price. See "Rights of Unitholders--Redemption of Units". A
Unitholder who wishes to dispose of his Units should inquire of his broker as
to current market prices in order to determine whether there is any price in
excess of the Redemption Price and, if so, the amount thereof. With respect to
Units of Trusts with a deferred sales charge, any such Units sold prior to the
time the entire deferred sales charge has been collected will be assessed the
amount of any remaining deferred sales charge at the time of sale. The Trustee
will notify the Sponsor of any tender of Units for redemption. If the Sponsor's
bid in the secondary market at that time equals or exceeds the Redemption Price
per Unit, it may purchase the Units not later than the day on which the Units
would otherwise have been redeemed by the Trustee.
FEE ACCOUNTS
--------------------------------------------------------------------------------
As described above, Units may be available for purchase by investors in Fee
Accounts where the Trust is Wrap Fee Eligible. You should consult your
financial professional to determine whether you can benefit from these
accounts. For these purchases you generally only pay the portion of the sales
charge that is retained by your Trust's Sponsor, Invesco Capital Markets, Inc.
You should consult the "Public Offering--Reducing Your Sales Charge" section
for specific information on this and other sales charge discounts. That section
governs the calculation of all sales charge discounts. The Sponsor reserves the
right to limit or deny purchases of Units in Fee Accounts by investors or
selling firms whose frequent trading activity is determined to be detrimental
to a Trust.
RIGHTS OF UNITHOLDERS
--------------------------------------------------------------------------------
Distributions of Interest and Principal. Interest received by a Trust, pro
rated on an annual basis, will be distributed monthly. The amount and time of
the first distribution is described under "Summary of Essential Financial
Information." In addition, a Trust that has elected to be structured as a
"regulated investment company" for federal tax purposes may make additional
required distributions at the end of each year.
Interest received by a Trust, including that part of the proceeds of any
disposition of bonds which represents accrued interest, is credited by the
Trustee to the Interest Account. Other receipts are credited to the Principal
Account. After deduction of amounts sufficient to reimburse the Trustee, without
interest, for any amounts advanced and paid to the Sponsor as the Unitholder of
record as of the First Settlement Date, interest received will be distributed on
each distribution date to Unitholders of record as of the preceding record date.
All distributions will be net of estimated expenses. The Trustee is not required
to pay interest on funds held in the Principal or Interest Account (but may
itself earn interest thereon and therefore benefits from the use of these
funds). Should the amount available for distribution in the Principal Account
equal or exceed $5.00 per Unit, the Trustee will make a distribution from the
Principal Account on the next monthly distribution date to Unitholders of record
on the related monthly record date. However, funds in the Principal Account will
be distributed on the last distribution date of each calendar year to
Unitholders of record as of the preceding record date if the amount available
for distribution shall equal at least $1.00 per Unit.
Because interest payments are not received by a Trust at a constant rate
throughout the year, interest distributions may be more or less than the amount
credited to the Interest Account as of the record date. For the purpose of
minimizing fluctuations in interest distributions, the Trustee is authorized to
advance amounts necessary to provide interest distributions of approximately
equal amounts. The Trustee is reimbursed for these advances from funds in the
Interest Account on the next record date. Persons who purchase Units between a
record date and a distribution date will receive their first distribution on
the second distribution date after the purchase.
Redemption of Units. All or a portion of your Units may be tendered to The
Bank of New York Mellon, the Trustee, for redemption at Unit Investment Trust
Division, 111 Sanders Creek Parkway, East Syracuse, New York 13057, on any day
the New York Stock Exchange is open. No redemption fee will be charged by the
Sponsor or the Trustee, but you are responsible for applicable governmental
charges, if any. Units redeemed by the Trustee will be canceled. You may redeem
all or a portion of your Units by sending a request for redemption to your bank
or broker-dealer through which you hold your Units. No later than three
business days following satisfactory tender, the Unitholder will receive an
amount for each Unit equal to the Redemption Price per Unit next computed after
receipt by the Trustee of the tender of Units. The "date of tender" is deemed
to be the date on which Units are received by the Trustee, except that as
regards Units received after the Evaluation Time on days of trading on the New
York Stock Exchange, the date of tender is the next day on which that Exchange
is open and the Units will be deemed to have been tendered to the Trustee on
that day for redemption at the Redemption Price. Redemption requests received
by authorized financial professionals prior to the Evaluation Time that are
properly transmitted to the Trustee by the time designated by the Trustee, are
priced based on the date of receipt. Redemption requests received by the
Trustee after the Evaluation Time, and redemption requests received by
authorized financial professionals after the Evaluation Time or redemption
requests received by such persons that are not transmitted to the Trustee until
after the time designated by the Trustee, are priced based on the date of the
next determined redemption price provided they are received timely by the
Trustee on such date. It is the responsibility of authorized financial
professionals to transmit redemption requests received by them to the Trustee
so they will be received in a timely manner. Certain broker-dealers or selling
firms may charge an order handling fee for processing redemption requests.
Units redeemed directly through the Trustee are not subject to such fees.
Under Internal Revenue Service regulations, the Trustee is required to
withhold a specified percentage of a Unit redemption if the Trustee has not
received the Unitholder's tax identification number as required by such
regulations. Any amount withheld is transmitted to the Internal Revenue Service
and may be recovered by the Unitholder only when filing a return. Under normal
circumstances the Trustee obtains the Unitholder's tax identification number
from the selling broker. However, at any time a Unitholder elects to tender
Units for redemption, the Unitholder should provide a tax identification number
to the Trustee in order to avoid this possible "back-up withholding."
The Redemption Price per Unit (as well as the secondary market Public
Offering Price) will be determined on the basis of the bid price of the bonds
as of the Evaluation Time on days of trading on the New York Stock Exchange on
the date any such determination is made. The Evaluator determines the
Redemption Price per Unit on days Units are tendered for redemption. The
Redemption Price per Unit is the pro rata share of each Unit on the basis of
(i) the cash on hand in the Trust or moneys in the process of being collected,
(ii) the value of the bonds based on the bid prices of the bonds, (iii) accrued
interest, less (a) amounts representing taxes or other governmental charges,
(b) the accrued Trust expenses and (c) for Trusts with a deferred sales charge,
any unpaid deferred sales charge payments. During the initial offering period,
the Redemption Price and secondary market repurchase price are not reduced by
estimated organization costs. The Evaluator may determine the value of the
bonds by employing any of the methods set forth in "Public Offering--Unit
Price." Accrued interest paid on redemption shall be withdrawn from the
Interest Account or, if the balance therein is insufficient, from the Principal
Account. All other amounts will be withdrawn from the Principal Account. Units
so redeemed shall be cancelled.
The price at which Units may be redeemed could be less than the price paid
by the Unitholder and may be less than the par value of the bonds represented
by the Units redeemed. The Trustee may sell bonds to cover redemptions. When
bonds are sold, the size and diversity of the Trust will be reduced. Sales may
be required at a time when bonds would not otherwise be sold and might result
in lower prices than might otherwise be realized.
The Trustee reserves the right to satisfy any redemption of 1,000 or more
Units with an aggregate redemption price of $1,000,000 or more in an in kind
distribution of bonds. An in kind distribution of bonds will be made by the
Trustee through the distribution of each of the bonds in the Trust in
book-entry form to the account of the Unitholder's broker-dealer at Depository
Trust Company. Amounts representing fractional portions of a bond will be
distributed in cash. The Trustee may adjust the bonds included in a
Unitholder's in kind distribution to facilitate the distribution of whole
bonds. Special tax consequences will result if a Unitholder receives an in kind
distribution.
The right of redemption may be suspended and payment postponed for any
period during which the New York Stock Exchange is closed, other than for
customary weekend and holiday closings, or during which the SEC determines that
trading on that Exchange is restricted or an emergency exists, as a result of
which disposal or evaluation of the bonds is not reasonably practicable, or for
other periods as the SEC may by order permit. Under certain extreme
circumstances the Sponsor may apply to the SEC for an order permitting a full
or partial suspension of the right of Unitholders to redeem their Units.
Exchange Option. When you redeem Units of your Trust or when your Trust
terminates, you may be able to exchange your Units for units of other Invesco
unit trusts at a reduced sales charge. An exchange does not avoid a taxable
disposition of your redeemed Units. You should contact your financial
professional for more information about trusts currently available for
exchanges. Before you exchange Units, you should read the prospectus of the new
trust carefully and understand the risks and fees. You should then discuss this
option with your financial professional to determine whether your investment
goals have changed, whether current trusts suit you and to discuss tax
consequences. We may discontinue this option at any time. The exchange will
generally be treated as a sale and a taxable transaction for federal and state
income tax purposes.
Units. Ownership of Units is evidenced in book-entry form only and will not
be evidenced by certificates. Units purchased or held through your bank or
broker-dealer will be recorded in book-entry form and credited to the account
of your bank or broker-dealer at the Depository Trust Company ("DTC"). Units
are transferable by contacting your bank or broker-dealer through which you
hold your Units. Transfer, and the requirements therefore, will be governed by
the applicable procedures of DTC and your agreement with the DTC participant in
whose name your Units are registered on the transfer records of DTC.
Reports Provided. Unitholders will receive a statement of interest and other
receipts received for each distribution. For as long as the Sponsor deems it to
be in the best interest of Unitholders, the accounts of each Trust will be
audited annually by an independent registered public accounting firm and the
report of the accountants will be furnished to Unitholders upon request. Within
a reasonable period of time after the end of each year, the Trustee will
furnish to each person who was a registered Unitholder during that year a
statement describing the interest and principal received on the bonds, actual
Trust distributions, Trust expenses, a list of the bonds and other Trust
information. Unitholders will be furnished the Evaluator's evaluations of the
bonds upon request to the Trustee. If you have questions regarding your account
or your Trust, please contact your financial advisor or the Trustee. The
Sponsor does not have access to individual account information.
INSURANCE ON THE BONDS
--------------------------------------------------------------------------------
Insurance may have been obtained guaranteeing prompt payment of interest and
principal, when due, in respect of certain of the bonds in your Trust. The
premium for any preinsured bond insurance has been paid by the issuer, by a
prior owner of the bonds and any policy is non-cancelable and will continue in
force so long as the bonds so insured are outstanding and the preinsured bond
insurer remains in business. The preinsured bond insurers are described in
"Portfolio" and the notes thereto. More detailed information regarding insurance
on the bonds and the preinsured bond insurers is included in the Information
Supplement. See "Additional Information." Each insurer is subject to regulation
by the department of insurance in the state in which it is qualified to do
business. Such regulation, however, is no guarantee that each insurer will be
able to perform on its contract of insurance in the event a claim should be
made. The financial information with respect to each insurer appears in reports
filed with state insurance regulatory authorities and is subject to audit and
review by such authorities. No representation is made herein as to the accuracy
or adequacy of such information or as to the absence of material adverse changes
in such information subsequent to the dates thereof.
Bond Insurers. Any downgrade in the rating of an insurer of the bonds in the
Trust may result in a downgrade in the rating of the issuer of the related bond
and therefore may have a material adverse effect on the value of the bonds in
the Trust and the value of your Units. The following is a description of the
various bond insurers:
ACA Financial Guaranty Corporation ("ACA Financial Guaranty"). On December
15, 2008, S&P withdrew the financial strength, financial enhancement, and
issuer credit ratings of ACA Financial Guaranty.
Ambac Assurance Corporation ("Ambac"). On November 8, 2010, Ambac Financial
Group, Inc., the holding company of Ambac, announced that it has filed for a
voluntary petition for relief under Chapter 11 of the United States Bankruptcy
Code (the "Bankruptcy Code") in the United States Bankruptcy Court for the
Southern District of New York (the "Bankruptcy Court"). Ambac Financial Group,
Inc. will continue to operate in the ordinary course of business as
"debtor-in-possession" under the jurisdiction of the Bankruptcy Court and in
accordance with the applicable provisions of the Bankruptcy Code and the orders
of the Bankruptcy Court. On November 30, 2010, S&P withdrew the counterparty
credit, financial strength, and financial enhancement ratings of Ambac at the
company's request. The November 30, 2010 rating action followed a directive by
the Commissioner of Insurance of the State of Wisconsin to Ambac to establish a
segregated account for certain insured exposure, primarily policies related to
credit derivatives, residential mortgage backed securities, and other
structured finance transactions. On April 7, 2011, Moody's withdrew the
insurance financial strength rating of Ambac Assurance.
Assured Guaranty Corp. ("Assured Guaranty") and Assured Guaranty Municipal
Corp. ("Assured Municipal") (formerly Financial Security Assurance, Inc.
("FSA")). On July 1, 2009, Assured Guaranty Ltd. ("Assured"), the parent company
of Assured Guaranty, completed the purchase of Financial Security Assurance
Holdings Ltd., the parent of financial guaranty insurance company, FSA.
Effective November 9, 2009, FSA was renamed "Assured Municipal." In certain
states, Assured Municipal may operate under its prior name. Assured Municipal, a
separately capitalized company, provides municipal bond insurance, while Assured
Guaranty provides financial guaranty insurance to both the municipal and
structured finance sectors. On January 17, 2013, Moody's downgraded the
insurance financial strength ratings of Assured Guaranty to A3 from Aa3 and of
Assured Municipal to A2 from Aa3, both with a stable outlook. The January 17,
2013 downgrade reflects Moody's reassessment of the business franchise, expected
future profitability and financial flexibility of Assured Guaranty and Assured
Municipal. On March 18, 2014 S&P raised the counterparty credit and financial
strength ratings of both Assured Guaranty and Assured Municipal to AA from AA-,
with a stable outlook. The March 18, 2014 upgrade reflects S&P's view that the
competitive position of Assured Guaranty and Assured Municipal remains strong
relative to its peers' in the bond insurance industry.
Berkshire Hathaway Assurance Corp. ("BHAC"). On April 8, 2009, Moody's
downgraded the insurance financial strength rating of BHAC from Aaa to Aa1,
with a stable outlook. This downgrade reflects Moody's view concerning "the
impact on Berkshire's key businesses of the severe decline in equity markets
over the past year as well as the protracted economic recession." On February
4, 2010, S&P lowered the financial strength rating of BHAC from AAA to AA+,
with a stable outlook, reflecting S&P's view that Berkshire's overall capital
adequacy has weakened to levels no longer consistent with a AAA rating and is
not expected to return to extremely strong levels in the near term.
Build America Mutual Assurance Company ("BAM"). On July 23, 2012, S&P
assigned an initial rating of AA to BAM's financial strength and counterparty
credit ratings, with a stable outlook. These ratings based upon S&P's view that
BAM holds a very strong competitive position with low industry risk, along with
extremely strong capital adequacy and strong operating performance.
CIFG Assurance North America, Inc. ("CIFG"). On November 11, 2009, Moody's
announced that it will withdraw the insurance financial strength rating of
CIFG. On February 16, 2010, S&P withdrew the counterparty credit, financial
strength, and financial enhancement ratings of CIFG.
Financial Guaranty Insurance Company ("FGIC"). On March 24, 2009, Moody's
withdrew the insurance financial strength rating of FGIC. On April 22, 2009, S&P
withdrew the counterparty credit, financial strength, and financial enhancement
ratings of FGIC. On November 24, 2009, FGIC announced that pursuant to an order
of the New York Insurance Department, the company must suspend any and all
claims payments until it has removed the impairment of its capital and restored
to compliance its minimum surplus to policyholders requirement.
Municipal Assurance Corporation ("MAC"). On March 18, 2014, S&P raised its
financial strength and enhancement rating on MAC from AA- to AA. The rating
action reflects S&P's view that MAC's competitive position remains strong
relative to its peers' in the bond industry. S&P continues to view MAC as having
a stable outlook.
National Public Finance Guarantee Corporation ("National Guarantee")
(formerly MBIA Insurance Corp. of Illinois ("MBIA Illinois")). On February 18,
2009, MBIA, Inc., the parent company of MBIA Insurance Corporation ("MBIA
Corp."), announced the restructuring of its financial guaranty insurance
operations following the approval of the New York and Illinois insurance
regulators. The restructuring involves the segregation of its financial
guaranty insurance operations into two separately capitalized sister companies,
with MBIA Illinois assuming the risk associated with its US municipal
exposures, and with MBIA Corp. insuring the remainder of the portfolio,
including all international and structured finance exposures. Business recently
ceded to MBIA Corp. from FGIC has been assigned to MBIA Illinois. On March 19,
2009, MBIA Illinois formally changed its name to National Public Finance
Guarantee Corporation.
National Guarantee is a wholly owned subsidiary of MBIA, Inc. and
independently capitalized with $5.6 billion in claims-paying resources as of
December 31, 2010. In certain states, National Guarantee may operate under its
prior name. On July 24, 2009, Moody's confirmed National Guarantee's insurance
financial strength rating of Baa1, with a developing outlook. On March 18, 2014,
S&P raised the counterparty credit, financial strength, and financial
enhancement ratings of National Guarantee to AA- from A, with a stable outlook.
Radian Asset Assurance, Inc. ("Radian"). On November 10, 2010, Moody's
confirmed Radian's Ba1 insurance financial strength rating, with a stable
outlook. On December 23, 2010, S&P confirmed Radian's BB- financial strength,
financial enhancement, and corporate credit ratings, with a negative outlook.
On May 21, 2013, Moody's upgraded National Guarantee's insurance financial
strength rating to Baa1 from Baa2, with a positive outlook. On May 10, 2013,
S&P raised the counterparty credit, financial strength, and financial
enhancement ratings of National Guarantee to A from BBB, with a stable
outlook.
Syncora Guarantee Inc. ("Syncora Guarantee") (formerly XL Capital Assurance
Inc. ("XLCA")). On March 9, 2009, Moody's downgraded the insurance financial
strength rating of Syncora Guarantee from Caa1 to Ca, with a developing
outlook. On July 28, 2010, S&P withdrew the counterparty credit, financial
strength and financial enhancement ratings of Syncora Guarantee.
TRUST ADMINISTRATION
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Sponsor. Invesco Capital Markets, Inc. is the Sponsor of your Trust. The
Sponsor is a wholly owned subsidiary of Invesco Advisers, Inc. ("Invesco
Advisers"). Invesco Advisers is an indirect wholly owned subsidiary of Invesco
Ltd., a leading independent global investment manager that provides a wide range
of investment strategies and vehicles to its retail, institutional and high net
worth clients around the globe. The Sponsor's principal office is located at 11
Greenway Plaza, Houston, Texas 77046-1173. As of March 31, 2015, the total
stockholders' equity of Invesco Capital Markets, Inc. was $105,899,086.21
(unaudited). The current assets under management and supervision by Invesco Ltd.
and its affiliates were valued at approximately $798.3 billion as of March 31,
2015.
The Sponsor and your Trust have adopted a code of ethics requiring Invesco
Ltd.'s employees who have access to information on Trust transactions to report
personal securities transactions. The purpose of the code is to avoid potential
conflicts of interest and to prevent fraud, deception or misconduct with
respect to your Trust. The Information Supplement contains additional
information about the Sponsor.
If the Sponsor shall fail to perform any of its duties under the Trust
Agreement or become incapable of acting or shall become bankrupt or its affairs
are taken over by public authorities, then the Trustee may (i) appoint a
successor Sponsor at rates of compensation deemed by the Trustee to be
reasonable and not exceeding amounts prescribed by the Securities and Exchange
Commission, (ii) terminate the Trust Agreement and liquidate the Trusts as
provided therein or (iii) continue to act as Trustee without terminating the
Trust Agreement.
Trustee. The Trustee is The Bank of New York Mellon, a trust company
organized under the laws of New York. The Bank of New York Mellon has its
principal unit investment trust division offices at 2 Hanson Place, 12th Floor,
Brooklyn, New York 11217, telephone (800) 856-8487. If you have any questions
regarding your account or your Trust, please contact the Trustee at its
principal unit investment trust division offices or your financial advisor. The
Sponsor does not have access to individual account information. The Bank of New
York Mellon is subject to supervision and examination by the Superintendent of
Banks of the State of New York and the Board of Governors of the Federal
Reserve System, and its deposits are insured by the Federal Deposit Insurance
Corporation to the extent permitted by law. Additional information regarding
the Trustee is set forth in the Information Supplement, including the Trustee's
qualifications and duties, its ability to resign, the effect of a merger
involving the Trustee and the Sponsor's ability to remove and replace the
Trustee. See "Additional Information."
Portfolio Administration. The Trusts are not managed funds and, except as
provided in the Trust Agreement, bonds generally will not be sold or replaced.
The Sponsor may, however, direct that bonds be sold in certain limited
situations to protect the Trust based on advice from the Supervisor. These
situations may include default in interest or principal payments on the bonds
or other obligations of an issuer, an advanced refunding or institution of
certain legal proceedings. In addition, the Trustee may sell bonds designated
by the Supervisor for purposes of redeeming Units or payment of expenses. The
Supervisor will consider a variety of factors in designating bonds to be sold
including interest rates, market value and marketability. Except in limited
circumstances, the Trustee will generally reject any offer by an issuer to
issue bonds in exchange or substitution for the bonds (such as a refunding or
refinancing plan). The Trustee will promptly notify Unitholders of any exchange
or substitution. The Information Supplement contains a more detailed
description of circumstances in which bonds may be sold or replaced. See
"Additional Information."
If a Trust is structured as a "regulated investment company" for federal tax
purposes, the Sponsor may direct the reinvestment of proceeds of the sale of
bonds if the sale is the direct result of serious adverse credit factors which,
in the opinion of the Sponsor, would make retention of the bonds detrimental to
the Trust. In such a case, the Sponsor may, but is not obligated to, direct the
reinvestment of sale proceeds in any other securities that meet the criteria
for inclusion in the trust on the Date of Deposit. The Sponsor may also
instruct the Trustee to take action necessary to ensure that such a Trust
continues to satisfy the qualifications of a regulated investment company and
to avoid imposition of tax on undistributed income of the Trust.
Replacement Bonds. No assurance can be given that a Trust will retain its
present size or composition because bonds may be sold, redeemed or mature from
time to time and the proceeds will be distributed to Unitholders and will not
be reinvested. In the event of a failure to deliver any bond that has been
purchased under a contract ("Failed Bonds"), the Sponsor is authorized under
the Trust Agreement to direct the Trustee to acquire other bonds ("Replacement
Bonds") to make up the original portfolio of a Trust. Replacement Bonds must be
purchased within 20 days after delivery of the notice of the failed contract
and the purchase price (exclusive of accrued interest) may not exceed the
amount of funds reserved for the purchase of the Failed Bonds. The Replacement
Bonds must be substantially identical to the Failed Bonds in terms of (i) the
exemption from federal and state taxation, (ii) maturity, (iii) yield to
maturity and current return and (iv) Standard & Poor's or Moody's ratings. The
Trustee shall notify all Unitholders of a Trust within five days after the
acquisition of a Replacement Bond and shall make a pro rata distribution of the
amount, if any, by which the cost of the Failed Bond exceeded the cost of the
Replacement Bond plus accrued interest. If Failed Bonds are not replaced, the
Sponsor will refund the sales charge attributable to the Failed Bonds to all
Unitholders of the Trust and distribute the principal and accrued interest (at
the coupon rate of the Failed Bonds to the date of removal from the Trust)
attributable to the Failed Bonds within 30 days after removal. All interest
paid to a Unitholder which accrued after the expected date of settlement for
Units will be paid by the Sponsor and accordingly will not be treated as
tax-exempt income. If Failed Bonds are not replaced, the Estimated Net Annual
Interest Income per Unit would be reduced and the Estimated Current Return and
Estimated Long-Term Return might be lowered. Unitholders may not be able to
reinvest their proceeds in other securities at a yield equal to or in excess of
the yield of the Failed Bonds.
Amendment of Trust Agreement. The Sponsor and the Trustee may amend the Trust
Agreement without the consent of Unitholders to correct any provision which may
be defective or to make other provisions that will not materially adversely
affect the interest of the Unitholders (as determined in good faith by the
Sponsor and the Trustee) or to maintain the tax status of a Trust. The Trust
Agreement may not be amended to increase the number of Units or to permit the
acquisition of bonds in addition to or in substitution for any of the bonds
initially deposited in a Trust, except for the substitution of certain refunding
bonds. The Trustee will notify Unitholders of any amendment.
Termination of Trust Agreement. A Trust will terminate upon the redemption,
sale or other disposition of the last bond held in the Trust. A Trust may also
be terminated at any time by consent of Unitholders of 75% of the Units then
outstanding or by the Trustee when the value of the Trust is less than 20% of
the original principal amount of bonds. A Trust will be liquidated by the
Trustee in the event that a sufficient number of Units not yet sold are
tendered for redemption by the Underwriters, including the Sponsor, so that the
net worth of such Trust would be reduced to less than 40% of the initial
principal amount of such Trust. If a Trust is liquidated because of the
redemption of unsold Units by the Underwriter, the Sponsor will refund to each
purchaser of Units the entire sales charge paid by such purchaser. The Trustee
will notify each Unitholder of any termination within a reasonable time and
will then liquidate any remaining bonds. The sale of bonds upon termination may
result in a lower amount than might otherwise be realized if the sale was not
required at that time. For this reason, among others, the amount realized by a
Unitholder upon termination may be less than the principal amount of bonds per
Unit or value at the time of purchase. The Trustee will distribute to each
Unitholder his share of the balance of the Interest and Principal Accounts
after deduction of costs, expenses or indemnities. The Unitholder will receive
a final distribution statement with this distribution. When the Trustee in its
sole discretion determines that any amounts held in reserve are no longer
necessary, it will distribute these amounts to Unitholders. The Information
Supplement contains further information regarding termination of a Trust. See
"Additional Information."
Limitation on Liabilities. The Sponsor, Supervisor, Evaluator and Trustee
shall be under no liability to Unitholders for taking any action or for
refraining from taking any action in good faith pursuant to the Trust
Agreement, or for errors in judgment, but shall be liable only for their own
willful misfeasance, bad faith or gross negligence (negligence in the case of
the Trustee) in the performance of their duties or by reason of their reckless
disregard of their obligations and duties hereunder. The Trustee shall not be
liable for depreciation or loss incurred by reason of the sale by the Trustee
of any of the bonds. In the event of the failure of the Sponsor to act under
the Trust Agreement, the Trustee may act thereunder and shall not be liable for
any action taken by it in good faith under the Trust Agreement. The Trustee is
not liable for any taxes or governmental charges imposed on the bonds, on it as
Trustee under the Trust Agreement or on a Trust which the Trustee may be
required to pay under any present or future law of the United States of America
or of any other taxing authority having jurisdiction. In addition, the Trust
Agreement contains other customary provisions limiting the liability of the
Trustee. The Trustee and Sponsor may rely on any evaluation furnished by the
Evaluator and have no responsibility for the accuracy thereof. Determinations
by the Evaluator shall be made in good faith upon the basis of the best
information available to it; provided, however, that the Evaluator shall be
under no liability to the Trustee, Sponsor or Unitholders for errors in
judgment.
FEDERAL TAX STATUS
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This is a general discussion of certain federal income tax consequences
arising from the purchase, ownership and disposition of Units of a Trust that
intends to qualify as a "regulated investment company" for federal income tax
purposes. The summary is limited to investors who hold the Units as "capital
assets" (generally, property held for investment) within the meaning of the
Internal Revenue Code of 1986, as amended (the "Code"). Unitholders should
consult their own tax advisers in determining the federal, state, local and any
other tax consequences of the purchase, ownership and disposition of Units.
Tax Status of the Trusts. The Trusts have elected to qualify and intend to
qualify annually as regulated investment companies under Subchapter M of the
Code. To qualify as a regulated investment company, a Trust must distribute to
its Unitholders at least 90% of its investment company taxable income (which
includes, among other items, dividends, taxable interest, if any, and the excess
of net short-term capital gains over net long-term capital losses) and 90% of
its tax-exempt interest income, and meet certain diversification of assets,
source of income, and other requirements. By meeting these requirements, a Trust
generally will not be subject to federal income tax on investment company
taxable income, and on net capital gains (the excess of net long-term capital
gains over net short-term capital losses) reported by a Trust as capital gain
dividends, distributed to Unitholders. A Trust can also avoid an annual
nondeductible 4% excise tax if each calendar year it distributes substantially
all of its ordinary income, short- and long-term capital gain, and any
previously undistributed and untaxed amounts.
If for any taxable year a Trust did not qualify as a regulated investment
company, all of its taxable income would be subject to tax at regular corporate
rates without any deduction for distributions to Unitholders, and any
distributions would be taxable to the Unitholders as ordinary dividends to the
extent of such Trust's current or accumulated earnings and profits. Such
distributions generally would be eligible for the dividends received deduction
in the case of corporate Unitholders and the lower federal income tax rate
currently applicable to qualifying dividend income for individual Unitholders,
provided certain holding period requirements were satisfied by the Trust and
the respective Unitholders.
The Trusts may be subject to state or local tax in jurisdictions in which
the Trusts are organized or may be deemed to be doing business.
Distributions. Each Trust intends to make sufficient distributions of
investment company taxable income, if any, capital gains, if any, and
exempt-interest dividends each year in order to qualify as a regulated
investment company and to avoid any Trust-level federal income or excise taxes.
Each Trust intends to be eligible to distribute exempt-interest dividends to
Unitholders by holding a sufficient amount of its assets in bonds generating
interest that is exempt from federal income taxation under Section 103 of the
Code. Such exempt-interest dividends are not subject to regular federal income
tax, but may be subject to alternative minimum tax.
Distributions of investment company taxable income (including net short-term
capital gains), if any, are taxable to Unitholders as ordinary income, and
generally will not qualify for treatment as qualified dividend income currently
taxed at a maximum federal rate of 20% for individual Unitholders or for the
dividends-received deduction for corporate Unitholders. Any income from your
Trust that you must take into account for federal tax purposes is not reduced by
amounts used to pay a deferred sales charge, if any.
Net capital gains of a Trust (net long-term capital gain over net short-term
capital loss), if any, realized and distributed by such Trust and reported as
capital gain dividends are taxable to Unitholders as long-term capital gains
currently at a maximum rate of 20%, without regard to the length of time the
Unitholder may have held his or her Units in the Trust. Capital gain dividends
are not eligible for the dividends-received deduction for corporate
Unitholders. In determining the amount of capital gains to be distributed by a
Trust, any capital loss carry over from a prior year will be taken into account
in determining the amount of net long-term capital gain. Taxable distributions
are taxable to investors whether received in cash or reinvested in additional
Units.
When the bonds owned by the Trusts were issued, special bond counsel issued
opinions that the interest on the bonds is not subject to regular federal
income tax (except in the limited circumstances referred to below). Payments
that a Trust receives on a bank letter of credit, guarantee or insurance policy
because the bond issuer has defaulted should be treated as payments on the
bond, namely as payments of principal or interest that are not subject to
regular federal income tax or taxable market discount or capital gain. The
tax-exempt status of the interest depends on compliance by the issuer and
others with ongoing requirements, and the opinions of bond counsel assume that
these requirements will be met. However, there is no guarantee that the issuers
(and other users) will comply with these requirements.
A Trust may have to accrue and distribute income not yet received if it
invests in bonds issued at a discount. A Trust may be required to sell bonds
that it otherwise would have continued to hold in order to generate sufficient
cash to make this distribution.
The interest on some private activity bonds is a preference item included in
alternative minimum taxable income. Each year the Trusts will give to
Unitholders a report showing the percentage of the Trust's income that is a
preference item. In addition, alternative minimum taxable income of a corporate
Unitholder is increased by part of the excess of its "adjusted current
earnings" (an alternative measure of income that includes interest on all tax
exempt securities) over the amount otherwise determined to be alternative
minimum taxable income. Therefore, the exempt-interest dividends may cause a
Unitholder to have to pay the federal alternative minimum tax or may increase
the amount of that tax payable by a Unitholder already subject to federal
alternative minimum tax.
The Trusts may own bonds originally issued at a discount. In general,
original issue discount is the difference between the price at which a bond was
issued and its stated redemption price at maturity. Original issue discount on
tax-exempt bonds accrues as tax-exempt interest over the life of the bond. A
Trust's adjusted tax basis for a bond issued with original issue discount will
include original issue discount accrued during the period it held the bond. A
Trust may also pay a premium when it buys a bond, even a bond issued with
original issue discount. A Trust may be required to amortize the premium over
the term of the bond and reduce its basis for the bond even though it does not
get any deduction for the amortization. Therefore, sometimes the Trust may have
a taxable gain when it sells a bond for an amount equal to or less than its
original tax basis.
Unitholders may receive ordinary income dividends from a Trust if the Trust
sells or redeems bonds that were acquired at a market discount, or sells bonds
at a short term capital gain. In general, the Internal Revenue Service ("IRS")
will treat Bonds as market discount bonds when the cost of the bond, plus any
original issue discount that has not yet accrued, is less than the amount due
to be paid at the maturity of the bond. The IRS generally taxes all or a
portion of the gain on the sale of a market discount bond as ordinary income
when the bond is sold, redeemed or paid. The portion of the gain taxed by the
IRS as ordinary income is equal to the portion of the market discount that has
accrued since the seller purchased the bond.
Some of the bonds held by the Trusts may lose their tax-exempt status while
they are owned by a "substantial user" of the facilities being financed with
the proceeds of those bonds, or by persons related to a substantial user. A
"substantial user" is a person whose gross revenue derived with respect to the
facilities financed by the bonds is more than 5% of the total revenue derived
by all users of those facilities, or who occupies more than 5% of the usable
area of the facilities or for whom the facilities or a part thereof were
specifically constructed, reconstructed or acquired. "Related persons" are
certain related individuals, affiliated corporations, partners and
partnerships. This rule would not change the tax-exempt status of interest on
bonds held by other persons. These rules may apply to a Unitholder who receives
exempt-interest dividends attributable to interest on bonds that financed
facilities for which such Unitholder or a related person is a "substantial
user."
Individuals must take exempt-interest dividends into consideration in
computing the portion, if any, of social security benefits that will be
included in their gross income and subject to federal income tax.
If a Trust declares dividends in October, November or December that are
payable to Unitholders of record on a date during those months, Unitholders
must take the dividends into account for tax purposes in the year the dividend
was declared, if the dividend is paid either in the year declared or in January
of the following year.
Ordinary, exempt-interest and capital gain dividends will be taxable as
described above whether received in cash or reinvested in additional Units.
If a Trust invests in securities of foreign issuers, it may be subject to
withholding and other similar income taxes imposed by a foreign country.
Dividends and distributions may also be subject to state and local taxes.
Investors should carefully consider the tax implications of buying Units
prior to a distribution by a Trust. The price of Units purchased at that time
includes the amount of the forthcoming distributions.
Distributions by a Trust reduce the net asset value of such Trust's Units,
and if a distribution reduces the net asset value below a Unitholder's cost
basis, such distribution, nevertheless, could be taxable to the Unitholder as
ordinary income or capital gain as described above, even though, from an
economic standpoint, it may constitute a partial return of capital.
Sale or Redemption of Units. Upon the taxable disposition (including a sale
or redemption) of Units of a Trust, a Unitholder may realize a gain or loss
depending upon such Unitholder's adjusted tax basis in the Units and the amount
of sale or redemption proceeds. Such gain or loss will be treated as capital
gain or loss if the Units are capital assets in the Unitholder's hands, and
will be long-term or short-term, generally depending upon the Unitholder's
holding period for the Units. Non-corporate Unitholders are currently subject
to tax at a maximum federal rate of 20% on capital gains resulting from the
disposition of Units held for more than 12 months (zero if the taxpayer is, and
would be after accounting for such gains, subject to a federal tax bracket for
ordinary income of 25% or less). However, a loss realized by a Unitholder on
the disposition of Units with respect to which capital gains dividends have
been paid will, to the extent of such capital gain dividends, also be treated
as long-term capital loss if such shares have been held by the Unitholder for
six months or less. Further, a loss realized on a disposition will be
disallowed to the extent the Units disposed of are replaced (whether by
reinvestment of distributions or otherwise) within a period of 61 days
beginning 30 days before and ending 30 days after the Units are disposed of. In
such a case, the basis of the Units acquired will be adjusted to reflect the
disallowed loss. Capital losses in any year are deductible only to the extent
of capital gains plus, in the case of a non-corporate taxpayer, $3,000 of
ordinary income ($1,500 for married individuals filing separately).
The Foreign Account Tax Compliance Act ("FATCA"). A 30% withholding tax on
your Trust's distributions, including capital gains distributions, and on gross
proceeds from the sale or other disposition of Units generally applies if paid
to a foreign entity unless: (i) if the foreign entity is a "foreign financial
institution" as defined under FATCA, the foreign entity undertakes certain due
diligence, reporting, withholding, and certification obligations, (ii) if the
foreign entity is not a "foreign financial institution," it identifies certain
of its U.S. investors or (iii) the foreign entity is otherwise excepted under
FATCA. Pursuant to the rules above and the applicability of any
intergovernmental agreements between the United States and the relevant foreign
country, withholding under FATCA is required: (i) generally with respect to
distributions from your Trust and (ii) with respect to certain capital gains
distributions and gross proceeds from a sale or disposition of Units that occur
on or after January 1, 2017. If withholding is required under FATCA on a payment
related to your Units, investors that otherwise would not be subject to
withholding (or that otherwise would be entitled to a reduced rate of
withholding) on such payment generally will be required to seek a refund or
credit from the IRS to obtain the benefit of such exemption or reduction. Your
Trust will not pay any additional amounts in respect of amounts withheld under
FATCA. You should consult your tax advisor regarding the effect of FATCA based
on your individual circumstances.
Backup Withholding. The Trusts generally must withhold and pay over to the
U.S. Treasury as backup withholding at a current rate of 28% of the taxable
dividends and other distributions paid to any individual Unitholder who either
does not supply its taxpayer identification number, has not reported all of its
dividends and interest income, or does not certify to a Trust that he or she is
not subject to withholding. The social security number of an individual is his
or her taxpayer identification number. Backup withholding also may be required
for a Unitholder upon notification of the Trust by the IRS. Backup withholding
is not an additional tax and any amounts withheld may be credited against a
Unitholder's ultimate federal income tax liability if proper documentation is
provided.
Foreign Withholding. Unitholders who are not U.S. persons should consult
their tax adviser regarding the U.S. and foreign tax consequences of ownership
of Units, including the possibility that such a Unitholder may be subject to a
U.S. withholding tax at a rate of 30% (or at a lower rate under an applicable
income tax treaty) on amounts received from a Trust.
Information Statements. After the end of each fiscal year for a Trust, the
Trustee will furnish to each Unitholder a statement containing information
regarding the amount of exempt-interest dividends, ordinary dividends, and
capital gain dividends distributed to such Unitholder during the fiscal year.
Investors Should Consult Their Tax Advisers. Prospective investors are urged
to consult their own tax advisers concerning the federal, state, local,
foreign, and any other tax consequences of the purchase, ownership and
disposition of Units based on their individual circumstances. Additional tax
information is contained in the Information Supplement.
EXPENSES
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General. The Trustee will periodically deduct from the Interest Account and,
to the extent funds are not sufficient therein, from the Principal Account,
amounts necessary to pay the expenses of the Trusts, provided that organization
costs, and deferred sales charges, if any, are generally paid out of cash
deposited in the Principal Account. The Trustee also may withdraw from these
Accounts such amounts, if any, as it deems necessary to establish a reserve for
any governmental charges payable out of the Trusts. Amounts so withdrawn shall
not be considered a part of a Trust's assets until such time as the Trustee
shall return all or any part of such amounts to the appropriate Accounts.
Organization Costs. You and the other Unitholders will bear all or a portion
of the organization costs and charges incurred in connection with the
establishment of your Trust. These costs and charges will include the cost of
the preparation, printing and execution of the trust agreement, registration
statement and other documents relating to your Trust, federal and state
registration fees and costs, the initial fees and expenses of the Trustee, and
legal and auditing expenses. The Public Offering Price of Units includes the
estimated amount of these costs. The Trustee will deduct these expenses from
your Trust's assets at the end of the initial offering period or after six
months, if earlier.
Sponsor, Supervisor, Evaluator and Trustee. The Sponsor and the Supervisor,
which is an affiliate of the Sponsor, will receive the annual fee indicated
under "Summary of Essential Financial Information" for providing bookkeeping and
administrative services and for providing portfolio supervisory services for the
Trusts. These fees may exceed the actual costs of providing these services for a
Trust but the total amount received for providing these services to all Invesco
unit investment trusts will not exceed the total cost of providing the services
in any calendar year. The Evaluator will receive the annual evaluation fee
indicated under "Summary of Essential Financial Information" for evaluating each
Trust's portfolio. For its services the Trustee will receive the fee indicated
under "Summary of Essential Financial Information" (which may be reduced as
described therein). Part of the Trustee's compensation for its services is
expected to result from the use of the funds being held in the Principal and
Interest Accounts for future distributions, payment of expenses and redemptions
since these Accounts are non-interest bearing to Unitholders. These fees are
based on the outstanding principal amount of bonds and Units on the Date of
Deposit for the first year and as of the close of business on January 1 for each
year thereafter. The Sponsor's, Supervisor's, Evaluator's and Trustee's fees may
be increased without approval of the Unitholders by amounts not exceeding
proportionate increases under the category "Services Less Rent of Shelter" in
the Consumer Price Index for All Urban Consumers or, if this category is not
published, in a comparable category.
Miscellaneous Expenses. The following additional charges are or may be
incurred by the Trusts: (a) fees of the Trustee for extraordinary services, (b)
expenses of the Trustee (including legal and auditing expenses) and of counsel
designated by the Sponsor, (c) various governmental charges, (d) expenses and
costs of any action taken by the Trustee to protect the Trusts and the rights
and interests of Unitholders, (e) indemnification of the Trustee for any loss,
liability or expenses incurred by it in the administration of the Trusts
without negligence, bad faith or willful misconduct on its part, (f) any
special custodial fees payable in connection with the sale of any of the bonds
in a Trust, (g) expenditures incurred in contacting Unitholders upon
termination of the Trusts and (h) costs incurred to reimburse the Trustee for
advancing funds to the Trusts to meet scheduled distributions (which costs may
be adjusted periodically in response to fluctuations in short-term interest
rates). Each Trust will pay the costs associated with updating its registration
statement each year. The fees and expenses set forth herein are payable out of
the Trusts. When such fees and expenses are paid by or owing to the Trustee,
they are secured by a lien on the portfolio of the applicable Trust. If the
balances in the Interest and Principal Accounts are insufficient to provide for
amounts payable by a Trust, the Trustee has the power to sell bonds to pay such
amounts.
ADDITIONAL INFORMATION
--------------------------------------------------------------------------------
This prospectus does not contain all the information set forth in the
registration statements filed by your Trust with the SEC under the Securities
Act of 1933 and the Investment Company Act of 1940 (file no. 811-2590). The
Information Supplement, which has been filed with the SEC and is incorporated
herein by reference, includes more detailed information concerning the bonds in
your Trust, investment risks and general information about the Trust.
Information about your Trust (including the Information Supplement) can be
reviewed and copied at the SEC's Public Reference Room in Washington, DC. You
may obtain information about the Public Reference Room by calling
1-202-551-8090. Reports and other information about your Trust are available on
the EDGAR Database on the SEC's Internet site at http://www.sec.gov. Copies of
this information may be obtained, after paying a duplication fee, by electronic
request at the following e-mail address: publicinfo@sec.gov or by writing the
SEC's Public Reference Section, Washington, DC 20549-0102.
OTHER MATTERS
--------------------------------------------------------------------------------
Legal Matters. The legality of the Units offered hereby and certain matters
relating to federal tax law have been passed upon by Paul Hastings LLP. Dorsey
& Whitney LLP has acted as counsel to the Trustee. Special counsel to each
Trust for certain state tax matters are named under "Tax Status".
Independent Registered Public Accounting Firm. The statement of condition
and the related portfolio at the Date of Deposit included in this prospectus
have been audited by Grant Thornton LLP, independent registered public
accounting firm, as set forth in their report in this prospectus, and are
included herein in reliance upon the authority of said firm as experts in
accounting and auditing.
Contents of Prospectus
Investment Objective 2
Principal Investment Strategy 2
Principal Risks 2
Summary of Essential Financial Information 3
Portfolio 4
Notes to Portfolio 7
Underwriting 7
Report of Independent Registered
Public Accounting Firm 8
Statement of Condition 8
The Trusts 9
Estimated Current and Long-Term Returns 13
Public Offering 14
Fee Accounts 21
Rights of Unitholders 22
Insurance on the Bonds 24
Trust Administration 25
Federal Tax Status 28
Expenses 31
Additional Information 31
Other Matters 32
Daily Prices
o Call our 24-Hour Pricing Line
(800) 953-6785
o Visit our Unit Trusts Daily Pricing Page
http://www.invesco.com/UIT
Account Questions
o Contact your financial advisor
o Contact the Trustee
(800) 856-8487
Learning More About Unit Trusts
o Contact your financial advisor
o Visit our Unit Trusts Internet Page
http://www.invesco.com/UIT
Additional Information
You may obtain an Information Supplement that
provides more details about your trust and
its policies.
o Visit the SEC Internet Site
http://www.sec.gov
o Contact the Trustee
(800) 856-8487
-----------------
When Units of the Trust are no longer available this prospectus may be used as
a preliminary prospectus for a future Trust. If this prospectus is used for
future Trusts you should note the following:
The information in this prospectus is not complete with respect to future Trust
series and may be changed. No person may sell Units of future Trusts until a
registration statement is filed with the Securities and Exchange Commission and
is effective. This prospectus is not an offer to sell Units and is not
soliciting an offer to buy Units in any state where the offer or sale is not
permitted.
U-IGINPRO60
U-CMSPRO1230
PROSPECTUS
-----------------------
May 26, 2015
Municipal Series 1230
Investment Grade Municipal
Trust, 7-13 Year Series 60
INVESCO
Information Supplement
Municipal Series 1230
Investment Grade Municipal Trust, 7-13 Year Series 60
--------------------------------------------------------------------------------
This Information Supplement provides additional information concerning the
risks and operations of each Trust which is not described in the prospectus for
the Trusts. This Information Supplement should be read in conjunction with a
Trust's prospectus. This Information Supplement is not a prospectus (but is
incorporated into the prospectus by reference), does not include all of the
information that an investor should consider before investing in a Trust and may
not be used to offer or sell Units without the prospectus. Copies of the
prospectus can be obtained by contacting the Sponsor's unit investment trust
division at 3500 Lacey Road, Suite 700, Downers Grove, Illinois 60515-5456, or
by contacting your broker. This Information Supplement is dated as of the date
of the Prospectus and all capitalized terms have been defined in the prospectus.
Table of Contents
Page
Municipal Bond Risk Factors................................. 2
Puerto Rico Risk Factors.................................... 6
Insurance on the Bonds...................................... 9
Portfolio Administration.................................... 19
Sponsor Information......................................... 21
Trustee Information......................................... 21
Taxation.................................................... 22
Termination of the Trust Agreement.......................... 23
Description of Ratings...................................... 24
Equivalent Taxable Estimated Current Return Tables.......... 27
Estimated Cash Flows to Unitholders......................... 28
INVESCO
Municipal Bond Risk Factors
The Trusts include certain types of bonds described below. Accordingly, an
investment in a Trust should be made with an understanding of the
characteristics of and risks associated with such bonds. The types of bonds
included in each Trust are described under "Portfolio" in the related
Prospectus. Neither the Sponsor nor the Trustee shall be liable in any way for
any default, failure or defect in any of the bonds.
General Obligation Bonds and Revenue Bonds. Certain of the bonds may be
general obligations of a governmental entity that are backed by the taxing power
of such entity. All other bonds in the Trusts are revenue bonds payable from the
income of a specific project or authority and are not supported by the issuer's
power to levy taxes. General obligation bonds are secured by the issuer's pledge
of its faith, credit and taxing power for the payment of principal and interest.
However, the taxing power of any governmental entity may be limited by
provisions of state constitutions or laws and an entity's credit will depend on
many factors. Some such factors are the entity's tax base, the extent to which
the entity relies on federal or state aid, and other factors which are beyond
the entity's control. Revenue bonds, on the other hand, are payable only from
the revenues derived from a particular facility or class of facilities or, in
some cases, from the proceeds of a special excise tax or other specific revenue
source. There are, of course, variations in the security of the different bonds
in a Trust, both within a particular classification and between classifications,
depending on numerous factors.
Housing Bonds. Certain of the bonds may be obligations which derive their
payments from mortgage loans. Certain of such housing bonds may be FHA insured.
Multi-family housing revenue bonds are payable primarily from mortgage loans to
housing projects for low to moderate income families. Single family mortgage
revenue bonds are issued for the purpose of acquiring from originating financial
institutions notes secured by mortgages on residences located within the
issuer's boundaries and owned by persons of low or moderate income. The ability
of housing issuers to make debt service payments on their obligations may be
affected by various economic and non-economic factors. Such factors include:
occupancy levels, adequate rental income in multi-family projects, the rate of
default on mortgage loans underlying single family issuers and the ability of
mortgage insurers to pay claims. Mortgage loans are generally partially or
completely prepaid prior to their final maturities as a result of events such as
sale of the mortgaged premises, default, condemnation or casualty loss. Because
these bonds are subject to extraordinary mandatory redemption in whole or in
part from such prepayments of mortgage loans, a substantial portion of such
bonds will probably be redeemed prior to their scheduled maturities or even
prior to their ordinary call dates. Extraordinary mandatory redemption without
premium could also result from the failure of the originating financial
institutions to make mortgage loans in sufficient amounts within a specified
time period. Additionally, unusually high rates of default on the underlying
mortgage loans may reduce revenues available for the payment of principal of or
interest on such mortgage revenue bonds. In each case the issuer of the bonds
has covenanted to comply with applicable requirements and bond counsel to such
issuer has issued an opinion that the interest on the bonds is exempt from
federal income tax under existing laws and regulations. Certain issuers of
housing bonds have considered various ways to redeem bonds they have issued
prior to the stated first redemption dates for such bonds. In connection with
the housing bonds held by a Trust, the Sponsor at the Date of Deposit is not
aware that any of the respective issuers of such bonds are actively considering
the redemption of such bonds prior to their respective stated initial call
dates.
Health Care Bonds. Certain of the bonds may be health care revenue bonds.
Ratings of bonds issued for health care facilities are often based on
feasibility studies that contain projections of occupancy levels, revenues and
expenses. A facility's gross receipts and net income available for debt service
may be affected by future events and conditions including, among other things,
demand for services and the ability of the facility to provide the services
required, physicians' confidence in the facility, management capabilities,
competition with other health care facilities, efforts by insurers and
governmental agencies to limit rates, legislation establishing state
rate-setting agencies, expenses, the cost and possible unavailability of
malpractice insurance, the funding of Medicare, Medicaid and other similar third
party payor programs, government regulation and the termination or restriction
of governmental financial assistance, including that associated with Medicare,
Medicaid and other similar third party payor programs. It also may be necessary
for a hospital or other health care facility to incur substantial capital
expenditures or increased operating expenses to effect changes in its
facilities, equipment, personnel and services. Hospitals and other health care
facilities are additionally subject to claims and legal actions by patients and
others in the ordinary course of business. There can be no assurance that a
claim will not exceed the insurance coverage of a health care facility or that
insurance coverage will be available to a facility.
Public Utility and Wholesale Electric Bonds. Certain of the bonds may be
obligations of public utility issuers, including those selling wholesale and
retail electric power and gas. General problems of such issuers would include
the difficulty in financing large construction programs in an inflationary
period, the limitations on operations and increased costs and delays
attributable to environmental considerations, the difficulty of the capital
market in absorbing utility debt, the difficulty in obtaining fuel at reasonable
prices and the effect of energy conservation. In addition, federal, state and
municipal governmental authorities may from time to time review existing, and
impose additional, regulations governing the licensing, construction and
operation of nuclear power plants, which may adversely affect the ability of the
issuers of certain of the bonds to make payments of principal and/or interest on
such bonds.
Water and Sewer Bonds. Certain of the bonds may be obligations of issuers
whose revenues are derived from the sale of water and/or sewerage services. Such
bonds are generally payable from user fees. The problems of such issuers include
the ability to obtain timely and adequate rate increases, population decline
resulting in decreased user fees, the difficulty of financing large construction
programs, the limitations on operations and increased costs and delays
attributable to environmental considerations, the increasing difficulty of
obtaining or discovering new supplies of fresh water, the effect of conservation
programs and the impact of "no-growth" zoning ordinances.
Industrial Revenue Bonds. Certain of the bonds may be industrial revenue
bonds ("IRBs"). IRBs have generally been issued under bond resolutions pursuant
to which the revenues and receipts payable under the arrangements with the
operator of a particular project have been assigned and pledged to purchasers.
In some cases, a mortgage on the underlying project may have been granted as
security for the IRBs. Regardless of the structure, payment of IRBs is solely
dependent upon the creditworthiness of the corporate operator of the project or
corporate guarantor. Corporate operators or guarantors may be affected by many
factors which may have an adverse impact on the credit quality of the particular
company or industry. These include cyclicality of revenues and earnings,
regulatory and environmental restrictions, litigation resulting from accidents
or environmentally-caused illnesses, extensive competition and financial
deterioration resulting from a corporate restructuring pursuant to a leveraged
buy-out, takeover or otherwise. Such a restructuring may result in the operator
of a project becoming highly leveraged which may impact on such operator's
creditworthiness which in turn would have an adverse impact on the rating and/or
market value of such bonds. Further, the possibility of such a restructuring may
have an adverse impact on the market for and consequently the value of such
bonds, even though no actual takeover or other action is ever contemplated or
effected.
Lease Obligation Bonds. Certain of the bonds may be obligations that are
secured by lease payments of a governmental entity (hereinafter called "lease
obligations"). Lease obligations are often in the form of certificates of
participation. Although the lease obligations do not constitute general
obligations of the municipality for which the municipality's taxing power is
pledged, a lease obligation is ordinarily backed by the municipality's covenant
to appropriate for and make the payments due under the lease obligation.
However, certain lease obligations contain "nonappropriation" clauses which
provide that the municipality has no obligation to make lease payments in future
years unless money is appropriated for such purpose on a yearly basis. A
governmental entity that enters into such a lease agreement cannot obligate
future governments to appropriate for and make lease payments but covenants to
take such action as is necessary to include any lease payments due in its
budgets and to make the appropriations therefor. A governmental entity's failure
to appropriate for and to make payments under its lease obligation could result
in insufficient funds available for payment of the obligations secured thereby.
Although "non-appropriation" lease obligations are secured by the leased
property, disposition of the property in the event of foreclosure might prove
difficult.
Higher Educations and Public Education Bonds. Certain of the bonds may be
obligations of issuers which are, or which govern the operation of, schools,
colleges and universities and whose revenues are derived mainly from ad valorem
taxes or for higher education systems, from tuition, dormitory revenues, grants
and endowments. General problems relating to school bonds include litigation
contesting the state constitutionality of financing public education in part
from ad valorem taxes, thereby creating a disparity in educational funds
available to schools in wealthy areas and schools in poor areas. Litigation or
legislation on this issue may affect the sources of funds available for the
payment of school bonds in the Trusts. General problems relating to college and
university obligations include the prospect of a declining percentage of the
population consisting of "college" age individuals, possible inability to raise
tuitions and fees sufficiently to cover increased operating costs, the
availability and restrictions on the use of endowments and other funds, the
uncertainty of continued receipt of federal grants and state funding, and
government legislation or regulations which may adversely affect the revenues or
costs of such issuers.
Airport and Transportation Bonds. Certain of the bonds in certain of the
Trusts may be obligations which are payable from and secured by revenues derived
from the ownership and operation of facilities such as airports, bridges,
turnpikes, port authorities, convention centers and arenas. The major portion of
an airport's gross operating income is generally derived from fees received from
signatory airlines pursuant to use agreements which consist of annual payments
for leases, occupancy of certain terminal space and service fees. Airport
operating income may therefore be affected by the ability of the airlines to
meet their obligations under the use agreements. From time to time the air
transport industry has experienced significant variations in earnings and
traffic, due to increased competition, excess capacity, increased costs,
deregulation, traffic constraints, acts of terrorism and other factors, and
several airlines have experienced severe financial difficulties. Similarly,
payment on bonds related to other facilities is dependent on revenues from the
projects, such as user fees from ports, tolls on turnpikes and bridges and rents
from buildings. Therefore, payment may be adversely affected by reduction in
revenues due to such factors as increased cost of maintenance, decreased use of
a facility, lower cost of alternative modes of transportation, scarcity of fuel
and reduction or loss of rents.
Waste Disposal Bonds. Certain of the bonds may be obligations which are
payable from and secured by revenues derived from the operation of resource
recovery facilities. Resource recovery facilities are designed to process solid
waste, generate steam and convert steam to electricity. Resource recovery bonds
may be subject to extraordinary optional redemption at par upon the occurrence
of certain circumstances, including but not limited to: destruction or
condemnation of a project; contracts relating to a project becoming void,
unenforceable or impossible to perform; changes in the economic availability of
raw materials, operating supplies or facilities necessary for the operation of a
project or technological or other unavoidable changes adversely affecting the
operation of a project; and administrative or judicial actions which render
contracts relating to the projects void, unenforceable or impossible to perform
or impose unreasonable burdens or excessive liabilities. The Sponsor cannot
predict the causes or likelihood of the redemption of resource recovery bonds in
a Trust prior to the stated maturity of the bonds.
Original Issue Discount Bonds. Certain of the bonds may have been acquired at
a market discount from par value at maturity. The coupon interest rates on
discount bonds at the time they were purchased and deposited in a Trust were
lower than the current market interest rates for newly issued bonds of
comparable rating and type. If such interest rates for newly issued comparable
bonds increase, the market discount of previously issued bonds will become
greater, and if such interest rates for newly issued comparable bonds decline,
the market discount of previously issued bonds will be reduced, other things
being equal. Investors should also note that the value of bonds purchased at a
market discount will increase in value faster than bonds purchased at a market
premium if interest rates decrease. Conversely, if interest rates increase, the
value of bonds purchased at a market discount will decrease faster than bonds
purchased at a market premium. In addition, if interest rates rise, the
prepayment risk of higher yielding, premium Securities and the prepayment
benefit for lower yielding, discount bonds will be reduced. A bond purchased at
a market discount and held to maturity will have a larger portion of its total
return in the form of taxable income and capital gain and less in the form of
tax-exempt interest income than a comparable bond newly issued at current market
rates. See "Federal Tax Status". Market discount attributable to interest
changes does not indicate a lack of market confidence in the issue.
Zero Coupon Bonds. Certain of the bonds may be "zero coupon" bonds. Zero
coupon bonds are purchased at a deep discount because the buyer receives only
the right to receive a final payment at the maturity of the bond and does not
receive any periodic interest payments. The effect of owning deep discount bonds
which do not make current interest payments (such as the zero coupon bonds) is
that a fixed yield is earned not only on the original investment but also, in
effect, on all discount earned during the life of such obligation. This implicit
reinvestment of earnings at the same rate eliminates the risk of being unable to
reinvest the income on such obligation at a rate as high as the implicit yield
on the discount obligation, but at the same time eliminates the holder's ability
to reinvest at higher rates in the future. For this reason, zero coupon bonds
are subject to substantially greater price fluctuations during periods of
changing market interest rates than are securities of comparable quality which
pay interest.
"When, as and if Issued" Bonds. Certain of the bonds may have been purchased
on a "when, as and if issued" or "delayed delivery" basis. The delivery of any
such bonds may be delayed or may not occur. Interest on these bonds begins
accruing to the benefit of Unitholders on their respective dates of delivery. To
the extent any bonds are actually delivered to a Trust after their respective
expected dates of delivery, Unitholders who purchase their Units prior to the
date such bonds are actually delivered to the Trustee would be required to
adjust their tax basis in their Units for a portion of the interest accruing on
such bonds during the interval between their purchase of Units and the actual
delivery of such bonds. As a result of any such adjustment, the Estimated
Current Returns during the first year would be slightly lower than those stated
in the prospectus which would be the returns after the first year, assuming the
portfolio of a Trust and estimated annual expenses other than that of the
Trustee (which may be reduced in the first year only) do not vary from that set
forth in the Prospectus. Unitholders will be "at risk" with respect to all bonds
in the portfolios including "when, as and if issued" and "delayed delivery"
bonds (i.e., may derive either gain or loss from fluctuations in the evaluation
of such bonds) from the date they commit for Units.
Redemption or Sale Prior to Maturity. Certain of the bonds may be subject to
redemption prior to their stated maturity date pursuant to sinking fund
provisions, call provisions or extraordinary optional or mandatory redemption
provisions or otherwise. A sinking fund is a reserve fund accumulated over a
period of time for retirement of debt. A callable debt obligation is one which
is subject to redemption or refunding prior to maturity at the option of the
issuer. A refunding is a method by which a debt obligation is redeemed, at or
before maturity, by the proceeds of a new debt obligation. In general, call
provisions are more likely to be exercised when the offering side valuation is
at a premium over par than when it is at a discount from par. The exercise of
redemption or call provisions will (except to the extent the proceeds of the
called bonds are used to pay for Unit redemptions) result in the distribution of
principal and may result in a reduction in the amount of subsequent interest
distributions; it may also affect the current return on Units of the Trust
involved. Each Trust portfolio contains a listing of the sinking fund and call
provisions, if any, with respect to each of the debt obligations. Extraordinary
optional redemptions and mandatory redemptions result from the happening of
certain events. Generally, events that may permit the extraordinary optional
redemption of bonds or may require the mandatory redemption of bonds include,
among others: a final determination that the interest on the bonds is taxable;
the substantial damage or destruction by fire or other casualty of the project
for which the proceeds of the bonds were used; an exercise by a local, state or
federal governmental unit of its power of eminent domain to take all or
substantially all of the project for which the proceeds of the bonds were used;
changes in the economic availability of raw materials, operating supplies or
facilities or technological or other changes which render the operation of the
project for which the proceeds of the bonds were used uneconomic; changes in law
or an administrative or judicial decree which renders the performance of the
agreement under which the proceeds of the bonds were made available to finance
the project impossible or which creates unreasonable burdens or which imposes
excessive liabilities, such as taxes, not imposed on the date the bonds are
issued on the issuer of the bonds or the user of the proceeds of the bonds; an
administrative or judicial decree which requires the cessation of a substantial
part of the operations of the project financed with the proceeds of the bonds;
an overestimate of the costs of the project to be financed with the proceeds of
the bonds resulting in excess proceeds of the bonds which may be applied to
redeem bonds; or an underestimate of a source of funds securing the bonds
resulting in excess funds which may be applied to redeem bonds. The issuer of
certain bonds in a Trust may have sold or reserved the right to sell, upon the
satisfaction of certain conditions, to third parties all or any portion of its
rights to call bonds in accordance with the stated redemption provisions of such
bonds. In such a case the issuer no longer has the right to call the bonds for
redemption unless it reacquires the rights from such third party. A third party
pursuant to these rights may exercise the redemption provisions with respect to
a bond at a time when the issuer of the bond might not have called a bond for
redemption had it not sold such rights. The Sponsor is unable to predict all of
the circumstances which may result in such redemption of an issue of bonds. See
also the discussion of single family mortgage and multi-family revenue bonds
above for more information on the call provisions of such bonds.
To the best knowledge of the Sponsor, there is no litigation pending as of
the Date of Deposit in respect of any bonds which might reasonably be expected
to have a material adverse effect upon any of the Trusts.
At any time after the Date of Deposit, litigation may be initiated on a
variety of grounds with respect to bonds in a Trust. Such litigation, as, for
example, suits challenging the issuance of pollution control revenue bonds under
environmental protection statutes, may affect the validity of such bonds or the
tax-free nature of the interest thereon. While the outcome of litigation of such
nature can never be entirely predicted, each Trust has received or will receive
opinions of bond counsel to the issuing authorities of each bond on the date of
issuance to the effect that such bonds have been validly issued and that the
interest thereon is exempt from federal income tax. In addition, other factors
may arise from time to time which potentially may impair the ability of issuers
to meet obligations undertaken with respect to the bonds.
Puerto Rico Risk Factors
Your Trust may invest significantly in bonds issued by issuers located in
Puerto Rico ("Puerto Rico," or the "Commonwealth"). As further described under
"Ratings", Puerto Rico's general obligation bonds are all currently rated below
investment grade following a number of downgrades by the major credit rating
agencies. As a result, the Commonwealth's access to the liquidity markets may be
limited, and further, the Commonwealth may not be able to honor all of its
obligations as they come due.
Relevant History. Puerto Rico came under United States sovereignty in 1898.
In 1950, Congress enacted Public Law 600, which provided that the existing
political, economic and fiscal relationship between Puerto Rico and the United
States would remain the same, but Puerto Rico would be authorized to draft and
approve its own Constitution, guaranteeing a republican form of government. The
Constitution of Puerto Rico was ratified by the United States Congress and
subsequently approved by the President of the United States. Puerto Rico is a
self-governing commonwealth in association with the United States. The United
States and the Commonwealth share a common defense, market and currency. Puerto
Rico exercises virtually the same control over its internal affairs as any of
the fifty states of the United States. However, it differs from the states in
its relationship with the United States federal government. The people of Puerto
Rico are citizens of the United States but do not vote in national elections
(they can only vote in local (Puerto Rico) elections). The people of the
Commonwealth are represented in Congress by a Resident Commissioner who has a
voice in the House of Representatives and limited voting power. The chief of
state of the Commonwealth is the President of the United States. The head of
government is an elected Governor. There are two legislative chambers: the House
of Representatives and the Senate. Most federal taxes, except those such as
Social Security taxes, are not levied in Puerto Rico. No federal income tax is
collected from Puerto Rico residents on income sourced in Puerto Rico, except
for certain federal employees who are subject to taxes on their salaries. Income
earned by Puerto Rico residents from sources outside of Puerto Rico, however, is
subject to federal income tax.
Geographic Location and Demography. Puerto Rico is the fourth largest of the
Caribbean islands and is located approximately 1,600 miles Southeast of New
York. It is approximately 100 miles long and 35 miles wide.
According to United States Census Bureau estimates, the population of Puerto
Rico reflected a decrease to approximately 3,615,086 as of July 1, 2013,
according to a United States Census Bureau estimate, compared to 3,725,789 in
2010.
Changes in population have had, and may continue to have, an impact on
economic growth and on the growth of tax revenues. Continued reductions in
population, particularly of working age individuals, may have an adverse effect
on tax and other government revenues that will not be entirely offset by
reductions in government expenses in the short and medium term. In addition, the
average age of the population of Puerto Rico is increasing, partly due to a
reduction in birth rate, but primarily as a result of the migration of younger
persons to the United States mainland. This may increase the demand for health
and other services upon the Commonwealth, and the cost to the Commonwealth of
providing such services, thus imposing limitations on the Commonwealth's ability
to achieve a balanced budget and improve its financial condition.
Relationship with the United States. While Puerto Rico has authority over its
internal affairs, the United States controls interstate trade, foreign relations
and commerce, customs administration, control of air, land and sea, immigration
and emigration, nationality and citizenship, currency, maritime laws, military
service, military bases, army, navy and air force, declaration of war,
constitutionality of laws, jurisdictions and legal procedures, treaties, radio
and television communications, agriculture, mining and minerals, highways,
postal system, social security, and other areas generally controlled by the
federal government in the United States. Puerto Rican institutions control
internal affairs unless U.S. law is involved, as in matters of public health and
pollution. Puerto Rico also lacks certain assignation of some revenues reserved
for the states.
Economy. The Commonwealth has established policies and programs directed
principally at developing the manufacturing and services sectors of the economy
and expanding and modernizing the Commonwealth's infrastructure. Domestic and
foreign investment have been stimulated by selective tax exemptions, development
loans, and other financial and tax incentives. Infrastructure expansion and
modernization have been primarily financed by bonds and notes issued by the
Commonwealth, its public corporations and municipalities. Economic progress has
been aided by significant increases in the levels of education and occupational
skills of the Commonwealth's population.
The economy of Puerto Rico is closely linked to the United States economy, as
most of the external factors that affect the local economy are determined by the
policies and performance of the mainland economy. These external factors include
exports, direct investment, the amount of federal transfer payments, the level
of interest rates, the rate of inflation, and tourist expenditures.
Approximately 71% of Puerto Rico's exports go to the United States and 42% of
the imports come from the United States. In recent fiscal years, however, the
performance of Puerto Rico's economy has not been consistent with the
performance of the United States economy. Puerto Rico's economy entered a
recession in the fourth quarter of fiscal year 2006. Puerto Rico has a
diversified economy with manufacturing and services comprising its principal
sectors. Puerto Rico's economy is closely linked to the United States economy.
In fiscal year 2012 (which ended on June 30, 2012), the Commonwealth's gross
national product (in current dollars) was $69.462 billion (preliminary), and
personal income per capita (in current dollars) was $16,934 (preliminary). In
the last three decades, industrial development in Puerto Rico has been
relatively capital intensive and dependent on skilled labor.
Puerto Rico has experienced mixed results in the service sector, which
includes wholesale and retail trade, utilities, transportation and warehousing,
information, finance and insurance, real estate and rental, and certain services
such as professional, scientific, technical, management, administrative,
support, educational, health care, social, recreational, accommodation, food and
other services. This sector has expanded in terms of income over the past
decade, following the general trend of other industrialized economies, but with
differences on the magnitudes of those changes. The development of the service
sector has been positively affected by demand generated by other sectors of the
economy, such as manufacturing and construction.
Tourism makes a significant contribution to economic activity. An estimated
$3.2 billion were spent by visitors in Puerto Rico during fiscal year 2012. San
Juan is the largest homeport for cruise ships in the Caribbean and one of the
largest homeports for cruise ships in the world. During the fiscal year 2012,
the number of persons registered in tourist hotels increased 9.4% compared with
fiscal year 2011.
The Puerto Rico Planning Board's preliminary reports on the performance of
the Puerto Rico economy for fiscal year 2012 indicate that real gross national
product increased 0.1% over fiscal year 2011. Nominal gross national product was
$69.5 billion in fiscal year 2012, compared to $65.6 billion in fiscal year
2011. Aggregate personal income increased from $61.6 billion in fiscal year 2011
to $62.3 billion in fiscal year 2012, and personal income per capita increased
from $16,611 in fiscal year 2011 to $16,934 in fiscal year 2012.
According to the Household Survey, the number of persons employed in Puerto
Rico during fiscal year 2012 averaged 1,035,465, a decrease of 1.1% compared to
the previous fiscal year; and the unemployment rate averaged 15.2%.
Debt, Revenues and Expenditures. Total assets and total liabilities of the
Commonwealth's primary government at June 30, 2012 amounted to $16.3 billion and
$55.3 billion, respectively, for a net deficit of $39 billion, compared to a
$33.7 billion net deficit at the beginning of the current year.
The Commonwealth has a net deficit of $47.2 billion in the governmental
activities and a net deficit of $2.0 billion in the General Fund as of June 30,
2013, which has resulted from operating deficits over the last several years.
The Commonwealth's high level of debt and the resulting required allocation of
revenues to service this debt have contributed to these deficits and have
adversely affected its credit ratings. The Commonwealth's expenses cover a range
of services. The largest expenses were for general government, education, public
housing and welfare, health, and public safety, which presented a combined
increase of approximately $235.6 million when compared with prior fiscal year.
In 2013, governmental activities' expenses exceeded program revenue by
approximately $14.3 billion, resulting in the use of approximately $8.6 billion
of general revenue and transfers from other funds (mostly taxes).
As of February 2014, preliminary General Fund Revenues for the first seven
months of fiscal year 2014 have exceeded aggregate General Fund revenues for the
same period in fiscal year 2013 by approximately $593.3 million.
The Commonwealth's very high level of debt has contributed to significant
budget deficits during the past several years, which deficits the Commonwealth
has been required to finance, further increasing the amount of its debt. More
recently, the Commonwealth's high level of debt, among other factors, has
adversely affected its credit ratings and its ability to obtain financing at
favorable interest rates.
Ratings. As of October 2014, the credit ratings of the Commonwealth's general
obligation bonds were lowered to "B2" by Moody's Investors Service ("Moody's"),
"BB" by Standard & Poor's Rating Services ("S&P"), and "BB-" by Fitch Ratings
("Fitch"), each of which is non-investment grade. S&P, Moody's and Fitch each
assigned a negative outlook on the Commonwealth's ratings.
Any explanation concerning the significance of such ratings must be obtained
from the rating agencies. There is no assurance that any ratings will continue
for any period of time or that they will not be revised or withdrawn.
Credit Ratings and Liquidity. The liquidity of the Commonwealth has been
adversely affected by the ratings downgrades described above, by the significant
increase in credit spreads for obligations of the Commonwealth and its
instrumentalities, by the limited market access experienced by the Commonwealth
and its instrumentalities during the second half of 2013, and by a significant
reduction of liquidity in the local Puerto Rico capital markets. Under current
market conditions, in part as a result of the recent ratings downgrades, the
Commonwealth may have limited capital market access. If the Commonwealth does
not have sufficient access to the capital markets or alternative sources of
financing to satisfy its liquidity needs, it may not be able to honor all of its
obligations as they come due.
Relationships with Creditors and Business Counterparties. Changes in the
Commonwealth's credit ratings could affect its relationships with creditors and
other business counterparties. For example, certain of the Commonwealth's
short-term financings, variable rate debt obligations and mandatory tender bonds
include provisions that permit the acceleration of such debt instruments based
on the downgrade of the Commonwealth's ratings below investment grade. Moreover,
the Commonwealth's interest rate exchange agreements include provisions that
permit the counterparties to either request additional collateral or terminate
the agreements based on the downgrade of the Commonwealth's ratings below
investment grade. The Commonwealth recently optionally terminated certain of its
interest rate exchange agreements and in connection therewith made aggregate
termination payments of approximately $23.8 million to a counterparty. To date,
however, the Commonwealth has not been required to post collateral in connection
with any of its interest rate exchange agreements, and the Commonwealth's
counterparties have not accelerated any debt obligations or terminated any
interest rate exchange agreements as a result of such downgrades. If the
counterparties entitled to accelerate debt obligations or terminate the
remaining interest rate exchange agreements exercise their respective rights,
there is no assurance that the Commonwealth would be able to honor all such
obligations as they come due.
Local Issuances. It should be noted that the creditworthiness of obligations
issued by local Puerto Rican issuers may be unrelated to the creditworthiness of
obligations issued by the Commonwealth of Puerto Rico, and there is no
obligation on the part of the Commonwealth to make payment on such local
obligations in the event of default.
Many factors including national economic, social and environmental policies
and conditions, which are not within the control of the issuers of such bonds,
could affect or could have an adverse impact on the financial condition of the
Commonwealth and various agencies and political subdivisions thereof. The
Sponsor is unable to predict whether or to what extent such factors or other
factors may affect the issuers of the bonds, the market value or marketability
of such bonds or the ability of the respective issuers of such bonds acquired by
certain trusts to pay interest on or principal of such bonds. The Puerto Rico
bonds are susceptible to political, economic or regulatory factors affecting
issuers of Puerto Rico municipal obligations. These include the possible adverse
effects of certain Puerto Rico constitutional amendments, legislative measures,
voter initiatives and other matters that are described.
The information provided above is only a brief summary of the complex factors
affecting the financial situation in Puerto Rico and is derived from sources
that are generally available to investors and are believed to be accurate. No
independent verification has been made as to the accuracy or completeness of any
of the preceding information. It is based in part on information obtained from
Commonwealth and local agencies in Puerto Rico or contained in Official
Statements for various Puerto Rico obligations.
Insurance on the Bonds
Insurance has been obtained by the issuer of bonds or by a prior owner of
such bonds prior to the deposit of such bonds in an Insured Trust guaranteeing
prompt payment of interest and principal, when due, in respect of the bonds in
such Insured Trust. See "The Trusts--Objective and Bond Selection". The premium
for any insurance policy or policies obtained by an issuer of bonds has been
paid by such issuer, and any such policy or policies are non-cancelable and will
continue in force so long as the bonds so insured are outstanding and the
preinsured bond insurer remains in business.
Bond Insurers. The following is a description of the various preinsured bond
insurers:
ACA Financial Guaranty Corporation ("ACA Financial Guaranty"). ACA Financial
Guaranty is organized and domiciled in the State of Maryland. Since December
2007, ACA Financial Guaranty has not issued any new financial guaranty insurance
policies and is currently operating as a runoff insurance company.
On August 8, 2008, ACA Financial Guaranty and counterparties to its
structured finance products reached an agreement on a restructuring plan for ACA
Financial Guaranty. The plan, approved by the Maryland Insurance Administration,
provided for settlement of the structured finance obligations and protection for
ACA Financial Guaranty's municipal policyholders. The settlement required that
ACA Financial Guaranty make a $209 million cash payment and a distribution of
surplus notes. The surplus notes provide the former collateralized debt
obligation ("CDO") counterparties and certain other counterparties with
approximately a 95% economic interest in ACA Financial Guaranty. ACA Financial
Guaranty continues to operate as a runoff insurance company and focus on
actively monitoring its remaining insured municipal obligations.
As of September 30, 2012, ACA Financial Guaranty had total admitted assets of
$436.3 million and total liabilities of $328.7 million, resulting in a surplus
as regards policyholders of $107.6 million.
On December 15, 2008, S&P raised the financial strength, financial
enhancement, and issuer credit ratings on ACA Financial Guaranty to B from CCC,
with a developing outlook. The upgrade reflected the positive effects of the
restructuring transaction completed in August 2008 that settled all outstanding
CDO and reinsurance exposures of the company, including the significantly
deteriorated CDO of asset-backed securities ("ABS") transactions, eliminating a
requirement to post a significant amount of collateral to the CDO of ABS
counterparties. At the same time, S&P also withdrew the ratings at ACA Financial
Guaranty's request.
The information relating to ACA Financial Guaranty contained above has been
furnished by ACA Financial Guaranty or the rating agencies. No representation is
made herein as to the accuracy or adequacy of such information, or as to the
existence of any adverse changes in such information subsequent to the date
hereof.
Ambac Assurance Corporation ("Ambac Assurance"). Ambac Financial Group, Inc.
("Ambac"), headquartered in New York City, is a holding company incorporated in
the state of Delaware on April 29, 1991. Ambac's activities are divided into two
business segments: (i) financial guarantee and (ii) financial services. Ambac
provides financial guarantee insurance for public and structured finance
obligations through its principal operating subsidiary, Ambac Assurance. As a
holding company, Ambac is largely dependent on dividends from Ambac Assurance to
pay principal and interest on its indebtedness and to pay its operating
expenses.
On June 5, 2008, S&P downgraded Ambac Assurance's insurance financial
strength rating to AA from AAA, with negative implications. On June 19, 2008,
Moody's downgraded Ambac Assurance's insurance financial strength rating from
Aaa to Aa3, with a negative outlook. Moody's June 19, 2008 downgrade of Ambac
Assurance's insurance financial strength rating reflects Ambac Assurance's
overall credit profile in the current environment, including its significantly
constrained new business prospects, its impaired financial flexibility and
increased expected and stress loss projections among its mortgage-related risk
exposures relative to previous estimates. On November 5, 2008, Moody's
downgraded the insurance financial strength rating of Ambac Assurance from Aa3
to Baa1, with a developing outlook, as a result of greater than expected
mortgage-related losses in the third quarter. On November 19, 2008, S&P lowered
its insurance financial strength rating of Ambac Assurance to A from AA, with a
negative outlook. The November 19, 2008 rating action on Ambac Assurance
reflects S&P's view that Ambac Assurance's exposures in the U.S. residential
mortgage sector and particularly the related collateralized debt obligation
structures have been a source of significant and comparatively
greater-than-competitor losses and will continue to expose the company to the
potential for further adverse loss development. On April 13, 2009, Moody's
downgraded the insurance financial strength rating of Ambac Assurance from Baa1
to Ba3, with a developing outlook, reflecting Ambac Assurance's weakened
business position and very constrained financial flexibility, as well as its
weakened risk adjusted capitalization, as Moody's loss estimates on residential
mortgage-backed securities ("RMBS") have increased significantly. In Moody's
view, these higher loss estimates increase the estimated capital required to
support Ambac Assurance's sizable direct RMBS portfolio (including securities
owned as well as securities guaranteed) and also the insurer's large portfolio
of ABS CDO risks. On June 24, 2009, S&P lowered the counterparty credit,
financial strength, and financial enhancement ratings of Ambac Assurance to BBB
from A with negative implications. The June 24, 2009 rating action on Ambac
Assurance reflects S&P's view that Ambac Assurance is effectively in runoff and
the likelihood of the company continuing as an operating entity capable of
writing new business has decreased significantly. On July 28, 2009, S&P lowered
the counterparty credit, financial strength, and financial enhancement ratings
of Ambac Assurance to CC from BBB, with a developing outlook. The July 28, 2009
rating action on Ambac Assurance reflects S&P's view of the significant
deterioration in the Ambac Assurance's insured portfolio of nonprime RMBS and
related CDOs, which has required the company to strengthen reserves to account
for higher projected claims. In S&P's view, the additional reserves will have a
significant negative effect on operating results, which will likely cause
surplus to decline to below regulator required minimums. On July 29, 2009,
Moody's downgraded the insurance financial strength rating of Ambac Assurance
from Ba3 to Caa2, with a developing outlook, reflecting Moody's belief that, as
a result of Ambac Assurance's recently announced large loss reserve increase and
credit impairment charge estimated for the second quarter of 2009 which would
reduce Ambac Assurance's regulatory capital to levels below the required minimum
threshold, there will be increased pressure on Ambac Assurance's counterparties
to commute outstanding exposures on terms that could imply a distressed
exchange. On March 25, 2010, S&P revised the counterparty credit, financial
strength, and financial enhancement ratings of Ambac Assurance to R from CC (an
issuer rated "R" by S&P is under regulatory supervision because of its financial
condition). S&P's March 25, 2010 rating action resulted following a directive by
the Commissioner of Insurance of the State of Wisconsin to Ambac Assurance to
establish a segregated account for certain insured exposure, primarily policies
related to credit derivatives, RMBS, and other structured finance transactions.
On March 26, 2010, Moody's placed the Caa2 insurance financial strength rating
of Ambac Assurance on review for possible upgrade. On November 23, 2010, Moody's
affirmed Ambac's Caa2 insurance financial strength rating, with a developing
outlook. On November 30, 2010, S&P withdrew the counterparty credit, financial
strength, and financial enhancement ratings of Ambac at the company's request.
The November 30, 2010 rating action followed a directive by the Commissioner of
Insurance of the State of Wisconsin to Ambac to establish a segregated account
for certain insured exposure, primarily policies related to credit derivatives,
residential mortgage-backed securities, and other structured finance
transactions. On April 7, 2011, Moody's withdrew the insurance financial
strength rating of Ambac Assurance.
There have been a number of developments with respect to ratings actions by
the rating agencies. As a result of these rating agency actions, as well as
investor concern with respect to these actions, Ambac Assurance and its
operating subsidiaries have been able to originate only a de minimis amount of
new financial guarantee business since November 2007, and no new business in
2009. As a result, Ambac is no longer competing for new business.
On March 25, 2010, Ambac announced that, at the direction of the Office of
the Commissioner of Insurance of the State of Wisconsin ("OCI"), Ambac Assurance
had established a segregated account for certain of its liabilities, primarily
policies related to credit derivatives, RMBS and other structured finance
transactions. This action derives from the OCI's view that immediate action is
necessary to address Ambac Assurance's financial position. In conjunction with
the establishment of the segregated account, the OCI has commenced
rehabilitation proceedings with respect to liabilities contained in the
segregated account in order to facilitate an orderly run-off and/or settlement
of those specific liabilities. On June 7, 2010 Ambac announced that it had
commuted all of its remaining CDOs of ABS and that certain other non-CDO of ABS
exposures would be commuted within the next twelve months.
On November 8, 2010, Ambac announced that it has filed for a voluntary
petition for relief under Chapter 11 of the United States Bankruptcy Code (the
"Bankruptcy Code") in the United States Bankruptcy Court for the Southern
District of New York (the "Bankruptcy Court"). Ambac will continue to operate in
the ordinary course of business as "debtor-in-possession" under the jurisdiction
of the Bankruptcy Court and in accordance with the applicable provisions of the
Bankruptcy Code and the orders of the Bankruptcy Court. Ambac Assurance is
subject to insurance regulatory requirements of the States of Wisconsin and New
York, and the other jurisdictions in which it is licensed to conduct business.
Ambac Assurance's statutory policyholder surplus and qualified statutory
capital were $100.0 million and $628.3 million at September 30, 2012,
respectively as compared to $495.3 million and $684.6 million as of December 31,
2011, respectively. As of September 30, 2012, total stockholders' deficit was
$3.49 billion; at December 31, 2011, total stockholders' deficit was $3.15
billion. This increased deficit was primarily caused by the net loss for the
nine months ended September 30, 2012, partially offset by unrealized gains on
investment securities during the period.
The information relating to Ambac Assurance contained above has been
furnished by Ambac Assurance or the rating agencies. No representation is made
herein as to the accuracy or adequacy of such information, or as to the
existence of any adverse changes in such information subsequent to the date
hereof.
Assured Guaranty Corp. ("Assured Guaranty") and Assured Guaranty Municipal
Corp. ("Assured Municipal") (formerly Financial Security Assurance Inc.
("FSA")). Assured Guaranty, a subsidiary of Assured Guaranty Ltd. ("Assured"),
is organized in the State of Maryland and provides financial guaranty insurance
to both the municipal and structured finance sectors. Assured Municipal, also a
subsidiary of Assured, is a separately capitalized company organized in the
State of New York and provides municipal bond insurance.
In January 2009, Assured Guaranty finalized an agreement with CIFG Assurance
North America, Inc. to assume a diversified portfolio of financial guaranty
contracts totaling approximately $13.3 billion of net par outstanding. Assured
Guaranty received $75.6 million, which included $85.7 million of upfront
premiums net of ceding commissions and approximately $12.2 million of future
installments related to this transaction.
On July 1, 2009, Assured completed the purchase of Financial Security
Assurance Holdings Ltd., the parent of financial guaranty insurance company,
FSA, from Dexia Holdings Inc. Effective November 9, 2009, FSA was renamed
Assured Guaranty Municipal Corp. In certain states, Assured Guaranty Municipal
Corp. may operate under its prior name, Financial Security Assurance Inc.
On June 24, 2010, S&P published a Full Analysis in which it affirmed its
"AAA" financial strength ratings of Assured Guaranty and Assured Municipal,
reflecting S&P's view of the companies' dominant market position in the bond
insurance industry and their strong combined capital position. On October 25,
2010, S&P lowered the counterparty credit and financial strength ratings of both
Assured Guaranty and Assured Municipal to AA+ from AAA, with a stable outlook.
The downgrades reflect S&P's view of a struggling financial guarantee market,
each company's weak statutory operating performance, and also the quality of
each company's capital within S&P's capital adequacy analysis. On November 30,
2011 S&P lowered the counterparty credit and financial strength ratings of both
Assured Guaranty and Assured Municipal to AA- from AA+, with a stable outlook.
The November 30, 2011 downgrades reflect S&P's view that Assured Guaranty and
Assured Municipal do not maintain enough capital to mitigate the largest obligor
concentrations for a higher rating. On March 18, 2014 S&P raised the
counterparty credit and financial strength ratings of both Assured Guaranty and
Assured Municipal to AA from AA-, with a stable outlook. The March 18, 2014
upgrade reflects S&P's view that the competitive position of Assured Guaranty
and Assured Municipal remains strong relative to its peers' in the bond
insurance industry.
On November 21, 2008, Moody's downgraded the insurance financial strength
rating of Assured Guaranty from Aaa to Aa2, primarily reflecting Moody's updated
view on Assured Guaranty's exposure to weakness inherent in the financial
guaranty business model. Also on November 21, 2008, Moody's downgraded the
insurance financial strength rating of FSA from Aaa to Aa3, reflecting Moody's
view of FSA's diminished business and financial profile resulting from its
exposure to losses on U.S. mortgage risks and disruption in the financial
guaranty business more broadly. On November 12, 2009, Moody's downgraded the
insurance financial strength rating of Assured Guaranty from Aa2 to Aa3, with a
negative outlook. Moody's November 12, 2009 downgrade results from Moody's
review of the performance of Assured's RMBS exposures. Moody's said that adverse
trends in RMBS loss estimates have had varying effects on Assured's main
insurance subsidiaries. On March 5, 2010, Moody's confirmed the insurance
financial strength ratings of both Assured Guaranty and Assured Municipal at
Aa3, with a negative outlook. On January 17, 2013, Moody's downgraded the
insurance financial strength ratings of Assured Guaranty to A3 from Aa3 and of
Assured Municipal to A2 from Aa3, both with a stable outlook. The January 17,
2013 downgrade reflects Moody's reassessment of the business franchise, expected
future profitability and financial flexibility of Assured Guaranty and Assured
Municipal.
Assured's third quarter 2012 net income declined to $142 million from $761
million in third quarter 2011 due primarily to the effects of changes in credit
spreads on the fair value of credit derivatives, offset in part by a decline in
loss expense, which was significantly higher in the prior year due mainly to the
effects of declining discount rates in the third quarter of 2011. Non-GAAP
operating income in third quarter 2012 was $166 million, an increase from
operating income in third quarter 2011, due primarily to higher net earned
premiums due to refundings, accelerations and terminations, lower loss expense,
and a lower effective tax rate on operating income. As of September 30, 2012,
Assured Guaranty had total assets of $5.28 billion and total liabilities of
$4.13 billion, resulting in total shareholder equity of $1.15 billion. As of
September 30, 2012, Assured Municipal had total assets of $10.74 billion and
total liabilities of $7.64 billion, resulting in total shareholder equity of
$3.10 billion.
The information contained above relating to Assured Guaranty and Assured
Municipal and their parent company, Assured, is based upon publicly available
information, or upon information that has been provided by the ratings agencies.
No representation is made herein as to the accuracy or adequacy of such
information, or as to the existence of any adverse changes in such information
subsequent to the date hereof.
Berkshire Hathaway Assurance Corp ("BHAC"). BHAC is a bond insurance company
created by Berkshire Hathaway, Inc. ("Berkshire") in December 2007 and is
licensed to write financial guarantee insurance in 49 states.
On April 11, 2008, S&P assigned an initial rating of AAA to BHAC's insurance
financial strength, with a stable outlook. On April 25, 2008, Moody's assigned
an initial rating of Aaa to BHAC's insurance financial strength, with a stable
outlook. On April 8, 2009, Moody's downgraded the insurance financial strength
rating of BHAC from Aaa to Aa1, with a stable outlook. This downgrade reflects
Moody's view concerning "the impact on Berkshire's key businesses of the severe
decline in equity markets over the past year as well as the protracted economic
recession." Moody's noted that Berkshire is also exposed to heightened
volatility in its earnings and capital base related to market value fluctuations
within its large portfolio of equity derivatives. On February 4, 2010, S&P
lowered the financial strength rating of BHAC from AAA to AA+, with a stable
outlook. The February 4, 2010 rating action was taken in anticipation of
Berkshire's acquisition of Northern Santa Fe Corporation reflecting S&P's
expectation that a significant part of the internal cash for the acquisition
will come from Berkshire's core insurance operations and that Berkshire's
overall capital adequacy has weakened to levels no longer consistent with a AAA
rating and is not expected to return to extremely strong levels in the near
term.
As of September 30, 2012, Berkshire had total assets of $424.1 billion and
total liabilities of $235.0 billion, resulting in total shareholder equity of
$189.1 billion.
The information relating to BHAC and its affiliates contained above has been
furnished by BHAC or the rating agencies. No representation is made herein as to
the accuracy or adequacy of such information, or as to the existence of any
adverse changes in such information subsequent to the date hereof.
Build America Mutual Assurance Company ("BAM"). BAM is a New York domiciled
mutual insurance company owned by the issuers of municipal bonds who use BAM to
insure their debt obligations. BAM officially launched on July 23, 2012 and
began writing policies in September of 2012.
On July 23, 2012, S&P assigned an initial rating of AA to BAM's financial
strength and counterparty credit ratings, with a stable outlook. These ratings
are based upon S&P's view that BAM holds a very strong competitive position with
low industry risk, along with extremely strong capital adequacy and strong
operating performance.
As of September 30, 2012 BAM had total net admitted assets of $518.9 million
and total liabilities of $27.9 million, resulting in a surplus as regards
policyholders of $491.0 million.
The information relating to BAM contained above has been furnished by BAM or
the rating agencies. No representation is made herein as to the accuracy or
adequacy of such information, or as to the existence of any adverse changes in
such information subsequent to the date hereof.
CIFG Assurance North America, Inc. ("CIFG"). CIFG Holding, Inc. is the
holding company for the CIFG group of financial guaranty insurance and
reinsurance companies ("CIFG Group"), including CIFG Assurance North America,
Inc., a New York corporation and its subsidiaries. The CIFG Group is actively
managing the runoff of a portfolio of insured structured finance, municipal and
infrastructure risks. On September 29, 2010, CIFG and CIFG Guaranty entered into
a merger agreement which resulted in CIFG Guaranty merging into CIFG (together
with related transactions, the "CIFG Merger").
On March 6, 2008, Moody's downgraded the insurance financial strength ratings
of CIFG from Aaa to A1, with a stable outlook. This rating action reflected
Moody's assessment of CIFG's weakened capitalization, impaired business
opportunities, and uncertain strategic direction, as a result, in part, of its
exposures to the U.S. residential mortgage market. Moody's believed that CIFG's
significant exposure to the mortgage sector, especially ABS CDOs is indicative
of a risk posture far greater than would be consistent with a Aaa rating going
forward. On May 20, 2008, Moody's downgraded the insurance financial strength
ratings of CIFG to Ba2 from A1, with direction uncertain, reflecting the high
likelihood that, absent material developments, the company would fail minimum
regulatory capital requirements in New York and Bermuda due to expected
significant increases in modeled loss reserves on ABS CDOs. In Moody's view, the
breach of such regulatory capital requirements would put the company in a
precarious position, especially in light of the solvency provisions embedded in
its CDS exposures. On October 28, 2008, Moody's downgraded the insurance
financial strength rating of CIFG from Ba2 to B3, with direction uncertain,
reflecting Moody's expectation of substantially higher mortgage-related losses
arising from CIFG's insured portfolio, as well as the possibility that certain
troubled exposures could be commuted. On January 22, 2009, Moody's upgraded the
insurance financial strength rating of CIFG from B3 to Ba3, with a developing
outlook, reflecting the strengthened capital adequacy profile of CIFG following
its restructuring and the commutation of substantially all of its ABS CDO risks.
Also on January 22, 2009, S&P raised the insurance financial strength rating of
CIFG to BB from B, with a developing outlook. S&P's January 22, 2009 upgrade
results from the completion of CIFG's restructuring plan involving key
policyholders, creditors, and equity owners (counterparties) who had hedged
their ABS CDO and commercial real estate CDO exposures with CIFG and which were
significantly affected by defaults and downgrades of the underlying collateral.
On June 15, 2009, S&P lowered the counterparty credit, financial strength, and
financial enhancement ratings of CIFG to CC from BB, with a negative outlook,
reflecting S&P's view of the significant deterioration in the company's insured
portfolio of nonprime RMBS which has necessitated that CIFG strengthen reserves
to account for the higher projected claims. On August 20, 2009, Moody's
downgraded the insurance financial strength ratings of CIFG from Ba3 to Caa2,
resulting from significant deterioration in the company's remaining insured
portfolio since January, 2009 when CIFG initiated a broad restructuring. On
November 11, 2009, Moody's downgraded the insurance financial strength ratings
of CIFG from Caa2 to Ca. Also on November 11, 2009, Moody's announced that it
will withdraw the insurance financial strength rating of CIFG. The November 11,
2009 rating actions reflect Moody's view that material deterioration in CIFG's
insured portfolio adversely affected the guarantor's capital adequacy profile
and Moody's believes that CIFG may no longer have sufficient financial resources
to pay all insurance claims. On February 16, 2010, S&P withdrew the counterparty
credit, financial strength, and financial enhancement ratings of CIFG.
As of September 30, 2012, CIFG had net admitted assets of $742.3 million and
total liabilities of $385.5 million. CIFG's statutory surplus as of September
30, 2012 is approximately $356.7 million, a decrease of approximately $227.8
million from approximately $584.5 million at December 31, 2011. This decrease is
primarily attributable to unpaid losses and loss adjustment expense reserves
established for student loans of approximately $252.3 million, which is
partially offset by other income statement balances resulting in a net loss of
approximately $227.0 million and an increase in contingency reserves of
approximately $3.5 million.
The information relating to CIFG and its affiliates contained above has been
furnished by CIFG or the rating agencies. No representation is made herein as to
the accuracy or adequacy of such information, or as to the existence of any
adverse changes in such information subsequent to the date hereof.
Financial Guaranty Insurance Company ("FGIC"). FGIC is a wholly owned
subsidiary of FGIC Corporation. The company was engaged in the business of
providing financial guaranty insurance and other forms of credit enhancement for
public finance and structured finance obligations. In January 2008, FGIC
voluntarily ceased writing financial guaranty policies concerning new or
additional risks.
The deterioration in the U.S. housing and mortgage markets and the global
credit markets, which accelerated in the fourth quarter of 2007 and continued
through the fourth quarter of 2009, has adversely affected the company's
business, results of operations and financial condition. Specifically, the
company incurred significant losses related to its exposure to certain ABS CDOs,
which are backed primarily by subprime RMBS, and to certain RMBS, primarily
backed by first-lien or second-lien mortgages. These losses have resulted in a
substantial reduction of FGIC's statutory policyholders' surplus over time. On
November 24, 2009, the New York State Insurance Department, the predecessor to
the New York State Department of Financial Services, issued an order pursuant to
Section 1310 of the New York Insurance Law requiring FGIC to, among other
things, suspend paying any and all claims. FGIC was subsequently unable to
eliminate the impairment of its policyholders' surplus through an out-of-court
Surplus Restoration Plan. On June 11, 2012, Benjamin M. Lawsky, Superintendent
of Financial Services of the State of New York (the "Superintendent") filed a
verified petition with the Supreme Court of the State of New York for an order
of rehabilitation (i) appointing the Superintendent as rehabilitator
("Rehabilitator") of FGIC, (ii) directing the Rehabilitator to take possession
of the property and assets of FGIC and to conduct the business thereof, and
(iii) directing the Rehabilitator to take steps towards the removal of the
causes and conditions which have made FGIC's rehabilitation proceeding (the
"Rehabilitation Proceeding") necessary. FGIC consented to the commencement of
the Rehabilitation Proceeding.
Prior to the fourth quarter of 2007, FGIC's financial strength was rated
"Aaa" by Moody's "AAA" by S&P, and "AAA" by Fitch Ratings, Inc. ("Fitch").
Moody's, S&P and Fitch have since completed several assessments of FGIC's
capital adequacy in relation to the company's exposure to ABS CDOs which are
backed primarily by subprime RMBS, and its exposure to first-lien and
second-lien RMBS. As a result of these assessments, Moody's, S&P and Fitch
downgraded the financial strength ratings of FGIC. As of March 31, 2008, Fitch
had downgraded FGIC from AA to BBB with Rating Watch Negative; Moody's had
downgraded FGIC from A3 to Baa3; and S&P had downgraded FGIC from A to BB. On
June 20, 2008, Moody's downgraded the insurance financial strength rating of
FGIC from Baa3 to B1, reflecting FGIC's severely impaired financial flexibility
and proximity to minimum regulatory capital requirements relative to Moody's
estimates of expected case losses. On November 24, 2008, S&P lowered its
insurance financial strength rating of FGIC to CCC from BB, with a negative
outlook. S&P's November 24, 2008 downgrade results from FGIC's exposure to
nonprime and second-lien mortgages and related CDO of ABS. On December 19, 2008,
Moody's downgraded the insurance financial strength rating of FGIC from B1 to
Caa1, with a negative outlook, reflecting Moody's expectation of higher
mortgage-related losses arising from FGIC's insured portfolio and the
constrained liquidity and financial flexibility of the holding company. On March
24, 2009, Moody's downgraded the insurance financial strength rating of FGIC
from Caa1 to Caa3, with a negative outlook, reflecting Moody's expectation of
higher mortgage-related losses arising from FGIC's insured portfolio,
insufficient claims paying resources to cover Moody's estimate of expected loss,
and the constrained liquidity and financial flexibility of FGIC's holding
company. Also on March 24, 2009, Moody's withdrew the insurance financial
strength rating of FGIC. On April 22, 2009, S&P lowered the counterparty credit,
financial strength, and financial enhancement ratings of FGIC to CC from CCC,
with a negative outlook. Also on April 22, 2009, S&P withdrew the ratings on
FGIC and the counterparty credit rating on the holding company, FGIC
Corporation, because of S&P's expectation that timely and comprehensive
financial information will no longer be available.
As of September 30, 2012, FGIC had net admitted assets of approximately $2.1
billion and total liabilities of approximately $5.8 billion.
On August 4, 2010, FGIC Corporation announced that it had filed a voluntary
petition for relief under Chapter 11 of the United States Bankruptcy Code in the
Southern District of New York. None of FGIC Corporation's subsidiaries or
affiliates, including FGIC, are part of the Chapter 11 filing.
The information relating to FGIC and its affiliates contained above has been
furnished by FGIC or the rating agencies. No representation is made herein as to
the accuracy or adequacy of such information, or as to the existence of any
adverse changes in such information subsequent to the date hereof.
Municipal Assurance Corporation ("MAC"). MAC is a New York domiciled
corporation providing municipal bond insurance for municipal and infrastructure
bonds. MAC currently guarantees only public finance transactions. MAC is an
Assured Guaranty company owned jointly by its affiliates Assured Guaranty
Municipal Corp. and Assured Guaranty Corp. MAC is part of the Assured Guaranty
Group.
On July 17, 2013, S&P assigned MAC a long-term financial strength and
counterparty credit rating of AA- to MAC with a stable outlook. On March 18,
2014, S&P raised its financial strength and enhancement rating on MAC from AA-
to AA. The rating action reflects S&P's view that MAC's competitive position
remains strong relative to its peers' in the bond industry. S&P continues to
view MAC as having a stable outlook.
As of June 30, 2014, MAC had a total net admitted assets of $1,519,869,768
and total liabilities of $999,277,625 resulting in a surplus as regards
policyholders of $520,592,143.
The information relating to MAC contained above is based upon publicly
available information or upon information that has been provided by the ratings
agencies. No representation is made herein as to the accuracy or adequacy of
such information, or as to the existence of any adverse changes in such
information subsequent to the date hereof.
National Public Finance Guarantee Corporation ("National Guarantee")
(formerly MBIA Insurance Corp. of Illinois ("MBIA Illinois")). MBIA, Inc., a
Connecticut corporation, conducts its financial guarantee business through
though its wholly-owned subsidiaries MBIA Insurance Corporation ("MBIA Corp."),
which writes global structured finance and non-U.S. public finance financial
guarantee insurance, and National Guarantee, which writes U.S. public finance
guarantees.
On February 18, 2009, MBIA, Inc., the parent company of MBIA Corp., announced
the restructuring of its financial guaranty insurance operations following the
approval of the New York and Illinois insurance regulators. The restructuring
involved the segregation of its financial guaranty insurance operations into two
separately capitalized sister companies, with National Guarantee assuming the
risk associated with its U.S. municipal exposures, and with MBIA Corp. insuring
the remainder of the portfolio, including all international and structured
finance exposures. Business ceded to MBIA Corp. from FGIC in 2008 has been
assigned to National Guarantee. To provide additional protection for its
municipal bond policyholders, National Guarantee has also issued second-to-pay
policies for the benefit of the policyholders covered by the reinsurance and
assignment. The second-to-pay policies, which are a direct obligation of
National Guarantee, will be held by The Bank of New York Mellon as insurance
trustee. These policies provide that if MBIA Corp. or FGIC, as applicable, do
not pay valid claims of their policyholders, the policyholders will then be able
to make a claim directly against National Guarantee under the second-to-pay
policies. On March 19, 2009, MBIA Illinois formally changed its name to National
Public Finance Guarantee Corporation. Effective December 1, 2009, National
Guarantee was redomesticated to the State of New York and is subject to
insurance regulations and supervision of the State of New York. National
Guarantee is a wholly owned subsidiary of MBIA, Inc. and independently
capitalized with $5.6 billion in claims-paying resources as of December 31,
2010. In certain states, National Public Finance Guarantee Corporation may
operate under its prior name, MBIA Insurance Corp. of Illinois.
On June 5, 2008, S&P downgraded MBIA Corp.'s insurance financial strength
rating to AA from AAA. On June 19, 2008, Moody's downgraded the insurance
financial strength ratings of MBIA Corp. and its insurance affiliates from Aaa
to A2. Moody's June 19, 2008 downgrade of MBIA Corp. and its insurance
affiliates reflects MBIA Corp.'s limited financial flexibility and impaired
franchise, as well as the substantial risk within its portfolio of insured
exposures and a movement toward more aggressive capital management within the
group. On November 7, 2008, Moody's downgraded the insurance financial strength
rating of MBIA Corp. and its insurance affiliates from A2 to Baa1, with a
developing outlook. Moody's November 7, 2008 downgrade of MBIA Corp. and its
insurance affiliates reflects MBIA Corp.'s diminished business and financial
profile resulting from its exposure to losses from U.S. mortgage risks and
disruption in the financial guaranty business more broadly. On February 18,
2009, Moody's downgraded the insurance financial strength rating of MBIA Corp.
from Baa1 to B3, with a developing outlook, reflecting MBIA Corp.'s substantial
reduction in claims-paying resources relative to the remaining higher-risk
exposures in its insured portfolio, given the removal of capital, and the
transfer of unearned premium reserves associated with the ceding of its
municipal portfolio to MBIA Illinois, as well as the continued deterioration of
MBIA Corp.'s insured portfolio of largely structured credits, with stress
reaching sectors beyond residential mortgage-related securities. Also on
February 18, 2009, S&P lowered the counterparty credit, financial strength, and
financial enhancement ratings of MBIA Corp. to BBB+ from AA, with a negative
outlook. The February 18, 2009 rating action on MBIA Corp. reflects S&P's view
that MBIA Corp.'s retained insured portfolio lacks sufficient sector diversity
and with time could become more concentrated, and that MBIA Corp.'s 2005-2007
vintage direct RMBS, CDO of ABS, and other structured exposures are subject to
continued adverse loss development that could erode capital adequacy. At the
same time, S&P lowered the counterparty credit and financial strength ratings of
MBIA Illinois to AA- from AA, reflecting MBIA Illinois's uncertain business
prospects and capital. On June 5, 2009, S&P lowered the counterparty credit,
financial strength, and financial enhancement ratings of MBIA Corp. to BBB from
BBB+, with a negative outlook, resulting from MBIA Corp.'s increased loss
assumptions on its 2005-2007 vintage direct RMBS and CDO of ABS and a change in
the assumed tax benefit of tax-loss carryforwards. Also on June 5, 2009, S&P
lowered the counterparty credit, financial strength, and financial enhancement
ratings of National Guarantee to A from AA-, with a negative outlook, reflecting
S&P's view of National Guarantee's uncertain business and capital-raising
prospects. On September 28, 2009, S&P lowered the counterparty credit, financial
strength, and financial enhancement ratings of MBIA Corp. to BB+ from BBB, with
a negative outlook, reflecting S&P's view that macroeconomic conditions continue
to contribute to losses on the group's structured finance products. On December
22, 2010 S&P lowered the counterparty credit, financial strength, and financial
enhancement ratings of MBIA Corp. to B from BB+, with a negative outlook,
reflecting increased stress case loss projections. Also on December 22, 2010 S&P
lowered the counterparty credit, financial strength, and financial enhancement
ratings of National Guarantee to BBB from A, with a developing outlook. On
December 19, 2011 Moody's downgraded the insurance financial strength rating of
National Guarantee from Baa1 to Baa2, with a negative outlook, based upon
weakening of the overall MBIA group's market standing as losses grow at National
Guarantee's affiliated companies and the risk that resources at National
Guarantee could be drawn away to support losses elsewhere within the group. On
May 10, 2013 S&P raised the counterparty credit, financial strength, and
financial enhancement ratings of National Guarantee to A from BB, with a stable
outlook. The May 10, 2013 rating action reflects S&P's view that MBIA Corp. no
longer acts as an anchor on the National Guarantee rating following the
settlement with Societe Generale that ends litigation challenging National
Guarantee's split from MBIA Corp. in 2009. On May 21, 2013 Moody's upgraded the
insurance financial strength rating of MBIA Corp. to B3 from Caa2, with a
positive outlook, citing MBIA Corp.'s improved capital and liquidity profile
following settlements of putback receivables and insured claims with major
counterparties. Also on May 21, 2013 Moody's upgraded the insurance financial
strength rating of National Guarantee to Baa1 from Baa2, with a positive
outlook. The May 21, 2013 rating action reflects National Guarantee's improved
credit profile following the repayment of the loan from its weaker affiliate,
MBIA Corp., and the termination of the litigation related to the 2009
restructuring. On March 18, 2014 S&P raised the counterparty credit, financial
strength and financial enhancement ratings of National Guarantee to AA- from A,
with a stable outlook. The March 18, 2014 upgrade reflects S&P's view that
National Guarantee's prospective strong business risk profile and strong
financial risk profile, based on the belief that the company will have a strong
competitive position and strong operating performance, as well as its current
extremely strong capital adequacy position.
As of September 30, 2012, National Guarantee had total net admitted assets of
$5.9 billion and total liabilities of $4.1 billion, resulting in a surplus as
regard policyholders of $1.8 billion.
As of September 30, 2012, MBIA, Inc. and its subsidiaries had total assets of
$22.1 billion and total liabilities of $19.6 billion. MBIA, Inc.'s total
shareholders' equity as of September 30, 2012 was $2.6 billion, increasing from
$1.7 billion as of December 31, 2011.
The information relating to MBIA and its affiliates contained above has been
furnished by MBIA or the rating agencies. No representation is made herein as to
the accuracy or adequacy of such information, or as to the existence of any
adverse changes in such information subsequent to the date hereof.
Radian Asset Assurance, Inc. ("Radian"). Radian Group Inc. ("Radian Group"),
headquartered in Philadelphia, provides private mortgage insurance and related
risk mitigation products and services to mortgage lenders nationwide through its
principal operating subsidiary, Radian Guaranty Inc. ("Radian Guaranty").
Radian, a wholly-owned subsidiary of Radian Guaranty, is domiciled and licensed
in New York as a financial guaranty insurer. In the third quarter of 2008,
Radian discontinued writing any new financial guaranty business, including
accepting reinsurance.
On March 12, 2009, Moody's downgraded the insurance financial strength rating
of Radian, as well as the ratings of its operational affiliates, from A3 to Ba1,
with a stable outlook, reflecting the substantial deterioration in the credit
profile of Radian Guaranty, coupled with increased loss estimates on Radian's
pooled corporate exposures. On November 24, 2009, S&P lowered the financial
strength, financial enhancement, and corporate credit ratings of Radian to BB
from BBB- and left the ratings on CreditWatch with negative implications,
reflecting S&P's view that adverse loss development in Radian's insured
portfolio has resulted in higher capital charges and could result in further
losses. On December 22, 2009, S&P lowered the financial strength, financial
enhancement, and corporate credit ratings of Radian to BB- from BB, with a
negative outlook.
As of September 30, 2012, Radian Group had total assets of $6.45 billion and
total liabilities of $5.43 billion. As of September 30, 2012, Radian had a
statutory policyholders' surplus of $1.02 billion and a contingency reserve of
$290.9 million.
The information relating to Radian and its affiliates contained above has
been furnished by Radian or the rating agencies. No representation is made
herein as to the accuracy or adequacy of such information, or as to the
existence of any adverse changes in such information subsequent to the date
hereof.
Syncora Guarantee Inc. ("Syncora Guarantee") (formerly XL Capital Assurance
Inc. ("XLCA")). Syncora Guarantee, a wholly owned subsidiary of Syncora Holdings
Ltd. ("Syncora Holdings"), is a New York domiciled financial guarantee insurance
company which provides credit enhancement and protection products to the public
finance and structured finance markets throughout the United States and
internationally.
In February 2008, Moody's downgraded the insurance financial strength ratings
of XLCA to A3 from Aaa. On June 20, 2008, Moody's downgraded the insurance
financial strength rating of XLCA from A3 to B2, reflecting XLCA's severely
impaired financial flexibility and proximity to minimum regulatory capital
requirements relative to Moody's estimates of expected case losses. On October
24, 2008, Moody's downgraded the insurance financial strength rating of Syncora
Guarantee from B2 to Caa1. On November 18, 2008, S&P lowered its insurance
financial strength rating of Syncora Guarantee to B from BBB- with developing
expectations. S&P's November 18, 2008 downgrade resulted from the Syncora
Guarantee's delay in implementing its restructuring plan and slow progress in
its negotiations with counterparties of its CDO of ABS exposure. On January 29,
2009, S&P lowered the issuer credit and financial strength ratings of Syncora
Guarantee to CC from B, with a negative outlook. S&P's January 29, 2009
downgrade resulted from S&P's recent update to its distressed exchange criteria.
On March 9, 2009, Moody's downgraded the insurance financial strength rating of
Syncora Guarantee from Caa1 to Ca, with a developing outlook, as a result of the
large loss reserve and credit impairment charges taken by Syncora Guarantee on
its mortgage-related exposures during the fourth quarter, which have resulted in
a $2.4 billion statutory deficit at Syncora Guarantee as of December 31, 2008.
On April 27, 2009, S&P revised the financial strength and financial enhancement
ratings of Syncora Guarantee to R from CC (an issuer rated "R" by S&P is under
regulatory supervision because of its financial condition). Also on April 27,
2009, S&P revised the counterparty credit rating of Syncora Guarantee to D from
CC (an issuer rated "D" by S&P has failed to pay one or more of its financial
obligation when it became due). S&P's April 27, 2009 rating actions resulted
from Syncora Guarantee's announcement that pursuant to an order of the New York
Insurance Department ("NYID"), the company must suspend any and all claims
payments until it has restored its policyholders' surplus to a level greater
than or equal to $65 million, the minimum the state requires. On July 28, 2010,
S&P withdrew the D counterparty credit rating and the R financial strength and
financial enhancement ratings of Syncora Guarantee. S&P's July 28, 2010 ratings
actions resulted from S&P's belief that there is not sufficient information to
judge Syncora Guarantee's claims paying ability.
As of September 30, 2012, Syncora Guarantee had total assets of $1.17 billion
and total liabilities of $639 million, resulting in a policyholders' surplus of
$504.2 million.
On July 20, 2010, Syncora Holdings announced that Syncora Guarantee has
completed its remediation plan sufficient to meet its minimum statutory
policyholder surplus requirements and address previously announced short and
medium term liquidity issues. Also on July 20, 2010, Syncora Holdings announced
that the NYID had approved Syncora Guarantee's plan for the payment of accrued
and unpaid claims and for the payment of new claims as they become due in the
ordinary course of business, resulting in the recommencement of claim payments
by Syncora Guaranty on regularly scheduled payment dates occurring on or after
July 21, 2010.
The information relating to Syncora Guarantee and its affiliates contained
above has been furnished by Syncora Guarantee or the rating agencies. No
representation is made herein as to the accuracy or adequacy of such
information, or as to the existence of any adverse changes in such information
subsequent to the date hereof.
The public can read and copy any materials the above referenced companies
file with the SEC at the SEC's Public Reference in Washington, D.C. You may
obtain information about the Public Reference Room by calling 1-202-551-8090.
Reports, proxy and information statements, and other information regarding
issuers, which may include the companies listed above, that file electronically
with the SEC available on the EDGAR Database on the SEC's Internet site at
http://www.sec.gov.
Portfolio Administration
The Trustee is empowered to sell, for the purpose of redeeming Units tendered
by any Unitholder, and for the payment of expenses for which funds may not be
available, such of the bonds designated by the Supervisor as the Trustee in its
sole discretion may deem necessary. The Supervisor, in designating such bonds,
will consider a variety of factors including (a) interest rates, (b) market
value and (c) marketability. The Sponsor, in connection with the Quality Trusts
and Investment Grade Municipal Trusts, may direct the Trustee to dispose of
bonds if the Supervisor determines that there exists any default in payment of
principal or interest, institution of certain legal proceedings, default under
other documents adversely affecting debt service, default in payment of
principal or interest or other obligations of the same issuer, decline in
projected income pledged for debt service on revenue bonds or decline in price
or occurrence of other market or credit factors, including advance refunding
(i.e., the issuance of refunding securities and the deposit of the proceeds
thereof in trust or escrow to retire the refunded securities on their respective
redemption dates), so that in the opinion of the Supervisor the retention of
such bonds would be detrimental to the interest of the Unitholders. In
connection with the Insured Trusts to the extent that bonds are sold which are
current in payment of principal and interest in order to meet redemption
requests and defaulted bonds are retained in the portfolio in order to preserve
the related insurance protection applicable to said bonds, the overall quality
of the bonds remaining in such Trust's portfolio will tend to diminish. Except
as described in this section and in certain other unusual circumstances for
which it is determined by the Trustee to be in the best interests of the
Unitholders or if there is no alternative, the Trustee is not empowered to sell
bonds from an Insured Trust which are in default in payment of principal or
interest or in significant risk of such default and for which value has been
attributed for the insurance obtained by such Insured Trust. Because of
restrictions on the Trustee under certain circumstances, the Sponsor may seek a
full or partial suspension of the right of Unitholders to redeem their Units in
an Insured Trust. See "Rights of Unitholders--Redemption of Units". The Sponsor
is empowered, but not obligated, to direct the Trustee to dispose of bonds in
the event of an advanced refunding.
The Trust is structured as a "regulated investment company" for federal tax
purposes. The Sponsor may direct the reinvestment of proceeds of the sale of
bonds if the sale is the direct result of serious adverse credit factors which,
in the opinion of the Sponsor, would make retention of the bonds detrimental to
the Trust. In such a case, the Sponsor may, but is not obligated to, direct the
reinvestment of sale proceeds in any other securities that meet the criteria for
inclusion in the trust on the Date of Deposit. The Sponsor may also instruct the
Trustee to take action necessary to ensure that such a Trust continues to
satisfy the qualifications of a regulated investment company and to avoid
imposition of tax on undistributed income of the Trust.
The Sponsor will generally instruct the Trustee to reject any offer made by
an issuer of any of the bonds to issue new obligations in exchange or
substitution for any bond pursuant to a refunding or refinancing plan, except
that the Sponsor may instruct the Trustee to accept or reject such an offer or
to take any other action with respect thereto as the Sponsor may deem proper if
(1) the issuer is in default with respect to such bond or (2) in the written
opinion of the Sponsor the issuer will probably default with respect to such
bond in the reasonably foreseeable future. Any obligation so received in
exchange or substitution will be held by the Trustee subject to the terms and
conditions of the Trust Agreement to the same extent as bonds originally
deposited thereunder. Within five days after the deposit of obligations in
exchange or substitution for underlying bonds, the Trustee is required to give
notice thereof to each Unitholder of the Trust thereby affected, identifying the
bonds eliminated and the bonds substituted therefor. Except as stated herein and
under "Trust Administration--Replacement Bonds" regarding the substitution of
Replacement Bonds for Failed Bonds, the acquisition by a Trust of any securities
other than the bonds initially deposited is not permitted.
If any default in the payment of principal or interest on any bonds occurs
and no provision for payment is made therefor within 30 days, the Trustee is
required to notify the Sponsor thereof. If the Sponsor fails to instruct the
Trustee to sell or to hold such bonds within 30 days after notification by the
Trustee to the Sponsor of such default, the Trustee may in its discretion sell
the defaulted bond and not be liable for any depreciation or loss thereby
incurred.
Sponsor Information
Invesco Capital Markets, Inc. is the Sponsor of the Trust. The Sponsor is a
wholly owned subsidiary of Invesco Advisers, Inc. ("Invesco Advisers"). Invesco
Advisers is an indirect wholly owned subsidiary of Invesco Ltd., a leading
independent global investment manager that provides a wide range of investment
strategies and vehicles to its retail, institutional and high net worth clients
around the globe. The Sponsor's principal office is located at 11 Greenway
Plaza, Houston, Texas 77046-1173. As of March 31, 2015, the total stockholders'
equity of Invesco Capital Markets, Inc. was $105,899,086.21 (unaudited). The
current assets under management and supervision by Invesco Ltd. and its
affiliates were valued at approximately $798.3 billion as of March 31, 2015.
(This paragraph relates only to the Sponsor and not to the Trust or to any other
Series thereof. The information is included herein only for the purpose of
informing investors as to the financial responsibility of the Sponsor and its
ability to carry out its contractual obligations. More detailed financial
information will be made available by the Sponsor upon request.)
The Sponsor and your Trust have adopted a code of ethics requiring Invesco
Ltd.'s employees who have access to information on Trust transactions to report
personal securities transactions. The purpose of the code is to avoid potential
conflicts of interest and to prevent fraud, deception or misconduct with respect
to your Trust.
If the Sponsor shall fail to perform any of its duties under the Trust
Agreement or become incapable of acting or shall become bankrupt or its affairs
are taken over by public authorities, then the Trustee may (i) appoint a
successor Sponsor at rates of compensation deemed by the Trustee to be
reasonable and not exceeding amounts prescribed by the Securities and Exchange
Commission, (ii) terminate the Trust Agreement and liquidate the Trusts as
provided therein or (iii) continue to act as Trustee without terminating the
Trust Agreement.
Trustee Information
The Trustee is The Bank of New York Mellon, a trust company organized under
the laws of New York. The Bank of New York Mellon has its principal unit
investment trust division offices at 2 Hanson Place, 12th Floor, Brooklyn, New
York 11217, telephone (800) 856-8487. The Bank of New York Mellon is subject to
supervision and examination by the Superintendent of Banks of the State of New
York and the Board of Governors of the Federal Reserve System, and its deposits
are insured by the Federal Deposit Insurance Corporation to the extent permitted
by law.
The duties of the Trustee are primarily ministerial in nature. It did not
participate in the selection of bonds for the portfolios of any of the Trusts.
In accordance with the Trust Agreement, the Trustee shall keep proper books of
record and account of all transactions at its office for the Trusts. Such
records shall include the name and address of every Unitholder of the Trusts.
Such books and records shall be open to inspection by any Unitholder at all
reasonable times during the usual business hours. The Trustee shall make such
annual or other reports as may from time to time be required under any
applicable state or Federal statute, rule or regulation. The Trustee is required
to keep a certified copy or duplicate original of the Trust Agreement on file in
its office available for inspection at all reasonable times during the usual
business hours by any Unitholder, together with a current list of the bonds held
in the Trusts.
Under the Trust Agreement, the Trustee or any successor trustee may resign
and be discharged of the trusts created by the Trust Agreement by executing an
instrument in writing and filing the same with the Sponsor. The Trustee or
successor trustee must mail a copy of the notice of resignation to all
Unitholders then of record, not less than 60 days before the date specified in
such notice when such resignation is to take effect. The Sponsor upon receiving
notice of such resignation is obligated to appoint a successor trustee promptly.
If, upon such resignation, no successor trustee has been appointed and has
accepted the appointment within 30 days after notification, the retiring Trustee
may apply to a court of competent jurisdiction for the appointment of a
successor. The Sponsor may remove the Trustee and appoint a successor trustee as
provided in the Trust Agreement at any time with or without cause. Notice of
such removal and appointment shall be mailed to each Unitholder by the Sponsor.
Upon execution of a written acceptance of such appointment by such successor
trustee, all the rights, powers, duties and obligations of the original trustee
shall vest in the successor. The resignation or removal of a Trustee becomes
effective only when the successor trustee accepts its appointment as such or
when a court of competent jurisdiction appoints a successor trustee. Any
corporation into which a Trustee may be merged or with which it may be
consolidated, or any corporation resulting from any merger or consolidation to
which a Trustee shall be a party, shall be the successor trustee. The Trustee
must be a banking corporation organized under the laws of the United States or
any state and having at all times an aggregate capital, surplus and undivided
profits of not less than $5,000,000.
Taxation
The prospectus contains a discussion of certain material U.S. federal income
tax issues concerning your Trust and the purchase, ownership and disposition of
Trust Units. The discussion below supplements the prospectus discussion and is
qualified in its entirety by the prospectus discussion. Prospective investors
should consult their own tax advisors with regard to the federal tax
consequences of the purchase, ownership, or disposition of Trust Units, as well
as the tax consequences arising under the laws of any state, locality, non-U.S.
country, or other taxing jurisdiction.
The federal income tax summary below and in the prospectus is based in part
on the advice of counsel to your Trust. The Internal Revenue Service could
disagree with any conclusions set forth in these discussions. In addition, our
counsel was not asked to review the assets to be held by your Trust.
Your Trust intends to elect and to qualify annually as a "regulated
investment company" under the Internal Revenue Code of 1986, as amended (the
"Code") and to comply with applicable distribution requirements so that it will
not pay federal income tax on income and capital gains distributed to its
Unitholders.
In addition, your Trust intends to hold a sufficient amount of its assets in
bonds that are exempt from U.S. federal income taxation under Section 103 of the
Code so as to qualify to distribute exempt-interest dividends to you. Such
exempt-interest dividends are not subject to regular U.S. federal income tax,
but may be subject to the alternative minimum tax. Your Trust may hold bonds
issued by the Government of Puerto Rico or by its authority. Such bonds are
exempt from taxation by the U.S. federal government, the government of Puerto
Rico, any state or its political subdivisions, any possession of the United
States, or the District of Columbia.
To qualify for the favorable U.S. federal income tax treatment generally
accorded to regulated investment companies, your Trust must, among other things,
(a) derive in each taxable year at least 90% of its gross income from dividends,
interest, payments with respect to securities loans and gains from the sale or
other disposition of stock, securities or foreign currencies or other income
derived with respect to its business of investing in such stock, securities or
currencies, and net income from qualified publicly traded partnerships; (b)
diversify its holdings so that, at the end of each quarter of the taxable year,
(i) at least 50% of the market value of the Trust's assets is represented by
cash and cash items (including receivables), U.S. Government securities, the
securities of other regulated investment companies and other securities, with
such other securities of any one issuer generally limited for the purposes of
this calculation to an amount not greater than 5% of the value of the Trust's
total assets and not greater than 10% of the outstanding voting securities of
such issuer, and (ii) not more than 25% of the value of its total assets is
invested in the securities (other than U.S. Government securities or the
securities of other regulated investment companies) of any one issuer, or two or
more issuers which the Trust controls (by owning 20% or more of the issuer's
outstanding voting securities) and which are engaged in the same, similar or
related trades or businesses, or the securities of qualified publicly traded
partnerships; and (c) distribute at least 90% of its investment company taxable
income (which includes, among other items, dividends, interest and net
short-term capital gains in excess of net long-term capital losses but excludes
net capital gain, if any) and at least 90% of its net tax-exempt interest income
each taxable year. Complying with these requirements may result in the capital
gains impact on Unitholders described in more detail in the next paragraph.
As a regulated investment company, your Trust generally will not be subject
to U.S. federal income tax on its investment company taxable income (as that
term is defined in the Code, but without regard to the deduction for dividends
paid), if any, and net capital gain (the excess of net long-term capital gain
over net short-term capital loss), if any, that it distributes to Unitholders.
Your Trust intends to distribute to its Unitholders, at least annually,
substantially all of its investment company taxable income and net capital gain,
if any. If your Trust retains any net capital gain or investment company taxable
income, it will generally be subject to federal income tax at regular corporate
rates on the amount retained. In addition, amounts not distributed on a timely
basis in accordance with a calendar year distribution requirement are subject to
a nondeductible 4% excise tax. In order to avoid this excise tax, your Trust
must distribute during each calendar year an amount equal to the sum of (1) at
least 98% of its ordinary income (not taking into account any capital gains or
losses) for the calendar year, (2) at least 98.2% of its capital gains in excess
of its capital losses (adjusted for certain ordinary losses) for the one-year
period ending October 31 of the calendar year, and (3) any ordinary income and
capital gains for previous years that were not distributed or taxed during those
years. To prevent application of the excise tax, your Trust intends to make its
distributions in accordance with the calendar year distribution requirement.
However, there is no assurance that your Trust will make sufficient
distributions to eliminate all tax liabilities in all periods. Your Trust may
make taxable distributions even during periods in which the Trust's Unit price
has declined. At certain times your Trust may recognize capital gains from
securities sold to generate cash to satisfy Unitholder redemption requests. In
order to satisfy the capital gains distribution requirement, your Trust may
report a portion of other income earned during the year, or "reclassify"
previously distributed income, including tax-exempt income, as taxable net
capital gain, thereby avoiding the need to sell additional securities to
generate the necessary funds to meet the distribution requirement. Further, if
your Trust retains any net capital gain, the Trust may report the retained
amount as undistributed capital gains in a notice to Unitholders who, if subject
to federal income tax on long-term capital gains (i) will be required to include
in income for federal income tax purposes, as long-term capital gain, their
share of such undistributed amount, and (ii) will be entitled to credit their
proportionate share of the tax paid by the Trust against their federal income
tax liabilities if any, and to claim refunds to the extent the credit exceeds
such liabilities. A distribution will be treated as paid on December 31 of the
current calendar year if it is declared by your Trust in October, November or
December with a record date in such a month and paid by your Trust during
January of the following calendar year. These distributions will be taxable to
Unitholders in the calendar year in which the distributions are declared, rather
than the calendar year in which the distributions are received.
If your Trust failed to qualify as a regulated investment company or failed
to satisfy the 90% distribution requirement in any taxable year, the Trust would
be taxed as an ordinary corporation on its taxable income (even if such income
were distributed to its Unitholders) and all distributions out of earnings and
profits would be taxed to Unitholders as ordinary dividend income.
Investors in the Trust may be subject to state, local, or foreign taxes in
connection with their investment in the Trust. Investors are encouraged to
consult their own tax advisors regarding the specific federal (including the
federal alternative minimum tax), state, local, and foreign tax consequences
that may affect them as a result of an investment in the Trust. The Trust does
not expect to seek any rulings from the Internal Revenue Service or opinions
from tax counsel.
Termination of the Trust Agreement
A Trust may be terminated at any time by consent of Unitholders of 75% of the
Units of such Trust then outstanding or by the Trustee when the value of such
Trust, as shown by any semi-annual evaluation, is less than 20% of the original
principal amount of bonds. A Trust will be liquidated by the Trustee in the
event that a sufficient number of Units not yet sold are tendered for redemption
by the Underwriters, including the Sponsor, so that the net worth of such Trust
would be reduced to less than 40% of the initial principal amount of such Trust.
If a Trust is liquidated because of the redemption of unsold Units by the
Underwriters, the Sponsor will refund to each purchaser of Units the entire
sales charge paid by such purchaser. The Trust Agreement provides that each
Trust shall terminate upon the redemption, sale or other disposition of the last
bond held in such Trust, but in no event shall it continue beyond the end of the
year preceding the fiftieth anniversary of the Trust Agreement in the case of an
IM-IT, an IM-IT Laddered Series, an Investment Grade Municipal, an Investment
Grade Municipal Limited Maturity Trust, a 10-20 Year Trust an IM-IT Discount, a
U.S. Territorial IM-IT, a High Grade Tax-Exempt Bond, 20+ Year Series, a
Long-Term State or a National Quality Trust, or beyond the end of the year
preceding the twentieth anniversary of the Trust Agreement in the case of a
Strategic Municipal Trust Intermediate Series, an IM-IT Limited Maturity Trust,
an IM-IT Intermediate Trust, a State Intermediate Trust, a State Intermediate
Laddered Maturity Trust, an IM-IT Short Intermediate Trust, an Investment Grade
Municipal Intermediate Trust, an Investment Grade Municipal 7-13 Year Trust, and
a Quality Municipals Income Trust Limited Maturity Series. In the event of
termination of any Trust, written notice thereof will be sent by the Trustee to
each Unitholder of such Trust at his address appearing on the registration books
of a Trust maintained by the Trustee. Within a reasonable time thereafter the
Trustee shall liquidate any bond then held in such Trust and shall deduct from
the funds of such Trust any accrued costs, expenses or indemnities provided by
the Trust Agreement, including estimated compensation of the Trustee and costs
of liquidation and any amounts required as a reserve to provide for payment of
any applicable taxes or other government charges. The sale of bonds in the Trust
upon termination may result in a lower amount than might otherwise be realized
if such sale were not required at such time. For this reason, among others, the
amount realized by a Unitholder upon termination may be less than the principal
amount or par amount of bonds represented by the Units held by such Unitholder.
The Trustee shall then distribute to each Unitholder his share of the balance of
the Interest and Principal Accounts. With such distribution the Unitholder shall
be furnished a final distribution statement of the amount distributable. At such
time as the Trustee in its sole discretion shall determine that any amounts held
in reserve are no longer necessary, it shall make distribution thereof to
Unitholders in the same manner.
Notwithstanding the foregoing, in connection with final distributions to
Unitholders of an Insured Trust, it should be noted that because the portfolio
insurance obtained by an Insured Trust, if any, is applicable only while bonds
so insured are held by such Trust, the price to be received by such Trust upon
the disposition of any such bond which is in default, by reason of nonpayment of
principal or interest, will not reflect any value based on such insurance.
Therefore, in connection with any liquidation, it shall not be necessary for the
Trustee to, and the Trustee does not currently intend to, dispose of any bond or
bonds if retention of such bond or bonds, until due, shall be deemed to be in
the best interest of Unitholders, including, but not limited to, situations in
which a bond or bonds so insured have deteriorated market prices resulting from
a significant risk of default. Since the Preinsured Bonds will reflect the value
of the related insurance, it is the present intention of the Sponsor not to
direct the Trustee to hold any of such Preinsured Bonds after the date of
termination. All proceeds received, less applicable expenses, from insurance on
defaulted bonds not disposed of at the date of termination will ultimately be
distributed to Unitholders of record as of such date of termination as soon as
practicable after the date such defaulted bond or bonds become due and
applicable insurance proceeds have been received by the Trustee.
Description of Ratings
Standard & Poor's, A Division of the McGraw-Hill Companies. A Standard &
Poor's long-term debt obligation credit rating is a current opinion of the
creditworthiness of an obligor with respect to a specific debt obligation. This
opinion of creditworthiness may take into consideration the creditworthiness of
guarantors, insurers or other forms of credit enhancement on the obligation.
The long-term debt obligation credit ratings are not a recommendation to
purchase, sell or hold the debt obligation, inasmuch as they do not comment as
to market price or suitability for a particular investor.
The long-term debt obligation credit ratings are based on current information
furnished by the obligor or obtained by Standard & Poor's from other sources it
considers reliable. Standard & Poor's does not perform an audit in connection
with any credit rating and may, on occasion, rely on unaudited financial
information. Credit ratings may be changed, suspended or withdrawn as a result
of changes in, or unavailability of, such information, or based on other
circumstances.
The long-term debt obligation credit ratings are based, in varying degrees,
on the following considerations:
I. Likelihood of payment--capacity and willingness of the obligor to meet
its financial commitment on an obligation in accordance with the terms
of the obligation.
II. Nature of and provisions of the obligation.
III. Protection afforded by, and relative position of, the obligation in
the event of bankruptcy, reorganization or other arrangement under the
laws of bankruptcy and other laws affecting creditors' rights.
The credit rating definitions are expressed in terms of default risk. As
such, they pertain to senior obligations of an entity. Junior obligations are
typically rated lower than senior obligations to reflect the lower priority in
bankruptcy, as noted above. (Such differentiation applies when an entity has
both senior and subordinate obligations, secured and unsecured obligations or
operating company and holding company obligations.) Accordingly, in the case of
junior debt, the rating may not conform exactly with the category definition.
AAA--An obligation rated "AAA" has the highest rating assigned by Standard &
Poor's. The obligor's capacity to meet its financial commitment on the
obligation is extremely strong.
AA--An obligation rated "AA" differs from the highest-rated obligations only
in small degree. The obligor's capacity to meet its financial commitment on the
obligation is very strong.
A--An obligation rated "A" is somewhat more susceptible to adverse effects of
changes in circumstances and economic conditions than obligations in
higher-rated categories. However, the obligor's capacity to meet its financial
commitment on the obligation is still strong.
BBB--An obligation rated "BBB" exhibits adequate protection parameters.
However, adverse economic conditions or changing circumstances are more likely
to lead to a weakened capacity of the obligor to meet its financial commitment
on the obligation.
Obligations rated "BB," "B," "CCC," "CC" and "C" are regarded as having
significant speculative characteristics. "BB" indicates the least degree of
speculation and "C" the highest. While such obligations will likely have some
quality and protective characteristics, these may be outweighed by large
uncertainties or major exposures to adverse conditions.
Plus (+) or Minus (-): The ratings from "AA" to "CCC" may be modified by the
addition of a plus or minus sign to show relative standing within the major
rating categories.
NR--This indicates that no rating has been requested, that there is
insufficient information on which to base a rating or that Standard & Poor's
does not rate a particular obligation as a matter of policy.
Moody's Investors Service. Moody's municipal ratings are opinions of the
investment quality of issuers and issues in the U.S. municipal and tax-exempt
markets. As such, these ratings incorporate Moody's assessment of the default
probability and loss severity of these issuers and issues. The default and loss
content for Moody's municipal long-term rating scale differs from Moody's
general long-term rating scale.
Municipal ratings are based upon the analysis of five primary factors
relating to municipal finance: market position, financial position, debt levels,
governance, and covenants. Each of the factors is evaluated individually and for
its effect on the other factors in the context of the municipality's ability to
repay its debt.
Aaa--Issuers or issues rated Aaa demonstrate the strongest creditworthiness
relative to other U.S. municipal or tax-exempt issuers or issues.
Aa--Issuers or issues rated Aa demonstrate very strong creditworthiness
relative to other U.S. municipal or tax-exempt issuers or issues.
A--Issuers or issues rated A present above-average creditworthiness relative
to other U.S. municipal or tax-exempt issuers or issues.
Baa--Issuers or issues rated Baa represent average creditworthiness relative
to other U.S. municipal or tax-exempt issuers or issues.
Obligations rated "Ba," "B," "Caa," "Ca" and "C" are regarded as having
significant speculative characteristics. "Ba" indicates the least degree of
speculation and "C" the highest. While such obligations will likely have some
quality and protective characteristics, these may be outweighed by large
uncertainties or major exposures to adverse conditions.
Note: Moody's appends numerical modifiers 1, 2, and 3 to each generic rating
category from Aa through Caa. The modifier 1 indicates that the issuer or
obligation ranks in the higher end of its generic rating category; the modifier
2 indicates a mid-range ranking; and the modifier 3 indicates a ranking in the
lower end of that generic rating category.
Equivalent Taxable Estimated Current Return Tables
The following table shows the approximate taxable estimated current returns
for single and joint return filers that are equivalent to tax-exempt estimated
current returns under current federal taxes using the published marginal federal
tax rates currently scheduled to be in effect in 2015. This table illustrates
the amount of return an investor would need in a taxable investment to earn an
after-tax return equal to that of a tax-exempt investment. The table does not
reflect any state or local taxes, the effect of limitations (if any) on the
amount of allowable itemized deductions or credits, any alternative minimum
taxes or any taxes other than federal personal income taxes. This information is
based on present law as of the date of publication and does not account for any
proposed changes in tax rates. See "Federal Tax Status" for a more detailed
discussion of federal tax rules applicable to an investment in the Trust.
[Enlarge/Download Table]
FEDERAL
Taxable Income Tax-Exempt Estimated Current Return
-------------------------------------- ------------------------------------------------------------
Single Joint Tax 3 1/2% 4% 4 1/2% 5% 5 1/2% 6% 6 1/2%
Return Return Rate Equivalent Taxable Estimated Current Return
-----------------------------------------------------------------------------------------------------------
$ 0-9,225 $ 0-18,450 10.0% 3.89% 4.44% 5.00% 5.56% 6.11% 6.67% 7.22%
9,226-37,450 18,451-74,900 15.0 4.12 4.71 5.29 5.88 6.47 7.06 7.65
37,451-90,750 74,901-151,200 25.0 4.67 5.33 6.00 6.67 7.33 8.00 8.67
90,751-189,300 151,201-230,450 28.0 4.86 5.56 6.25 6.94 7.64 8.33 9.03
189,301-411,500 230,451-411,500 33.0 5.22 5.97 6.72 7.46 8.21 8.96 9.70
411,501-413,200 411,501-464,850 35.0 5.38 6.15 6.92 7.69 8.46 9.23 10.00
Over 413,200 Over 464,850 39.6 5.79 6.62 7.45 8.28 9.11 9.93 10.76
A comparison of tax-free and equivalent taxable estimated current returns
with the returns on various taxable investments is one element to consider in
making an investment decision. The Sponsor may from time to time in its
advertising and sales materials compare the then current estimated returns on
the Trusts and returns over specified periods on other similar Invesco
sponsored unit investment trusts with inflation rates and with returns on
taxable investments such as corporate or U.S. Government bonds, bank CDs and
money market accounts or money market funds, each of which has investment
characteristics that may differ from those of the Trusts. U.S. Government bonds,
for example, are backed by the full faith and credit of the federal government.
Money market accounts and money market funds provide stability of principal, but
pay interest at rates that vary with the condition of the short-term debt
market. The investment characteristics of the Trusts are described more fully in
the prospectus.
Estimated Cash Flows to Unitholders
The table below sets forth the per Unit estimated monthly distributions of
interest and principal to Unitholders. The table assumes no changes in expenses,
no changes in the current interest rates, no exchanges, redemptions, sales or
prepayments of the underlying bonds prior to maturity or expected retirement
date and the receipt of principal upon maturity or expected retirement date. To
the extent the foregoing assumptions change actual distributions will vary.
Investment Grade Municipal Trust, 7-13 Year Series 60
Monthly
Estimated Estimated Estimated
Distribution Dates Interest Principal Total
(Each Month) Distribution Distribution Distribution
--------------------------------------------------------------------------
July 2015 $ 4.49 $ 4.49
August 2015 - June 2021 3.29 3.29
July 2021 3.23 $ 22.04 25.27
August 2021 - June 2022 3.22 3.22
July 2022 3.21 14.99 18.20
August 2022 - November 2022 3.18 3.18
December 2022 3.05 39.68 42.73
January 2023 3.01 7.06 10.07
February 2023 - April 2023 2.99 2.99
May 2023 2.99 1.76 4.75
June 2023 2.98 2.98
July 2023 2.97 14.99 17.96
August 2023 2.92 2.92
September 2023 2.89 8.82 11.71
October 2023 2.88 2.65 5.53
November 2023 2.88 2.88
December 2023 2.86 21.16 24.02
January 2024 2.80 17.64 20.44
February 2024 2.62 39.68 42.30
March 2024 2.59 2.59
April 2024 2.59 3.53 6.12
May 2024 - June 2024 2.58 2.58
July 2024 2.47 110.23 112.70
August 2024 2.19 13.23 15.42
September 2024 1.93 83.77 85.70
October 2024 1.88 1.88
November 2024 1.87 12.35 14.22
December 2024 1.80 41.44 43.24
January 2025 1.52 67.02 68.54
February 2025 - March 2025 1.45 1.45
April 2025 1.39 43.21 44.60
May 2025 1.27 1.27
June 2025 1.17 79.37 80.54
July 2025 .82 101.41 102.23
August 2025 .50 35.27 35.77
September 2025 - November 2025 .42 .42
December 2025 .39 26.46 26.85
January 2026 - October 2026 .32 .32
November 2026 .31 12.34 12.65
December 2026 - April 2027 .29 .29
May 2027 .26 42.33 42.59
June 2027 .18 6.17 6.35
July 2027 .13 44.09 44.22
August 2027 .02 43.21 43.23
September 2027 .00 .00
October 2027 .00 43.94 43.94
U-CMSSUP1230
CONTENTS OF REGISTRATION STATEMENT
This Amendment of the Registration Statement comprises the following papers
and documents:
The Facing Sheet of Form S-6.
The Prospectus.
The Undertaking to File Reports.
The Signatures.
The Written Consents of the Legal Counsel, Initial Evaluator and
Independent Registered Public Accounting Firm.
The following exhibits:
1.1 Trust Agreement.
1.1.1 Standard Terms and Conditions of Trust. Reference is made to Exhibit
1.1.1 to the Registration Statement on Form S-6 of Invesco Unit
Trusts, Municipal Series 1130 (File No. 333-184264) dated December 4,
2012.
1.2 Certificate of Incorporation of Van Kampen Funds Inc. Reference is
made to Exhibit 1.2 to the Registration Statement on Form S-6 of Van
Kampen Focus Portfolios, Series 320 (File No. 333-75548) dated January
2, 2002.
1.2.1 Certificate of Amendment of Certificate of Incorporation changing the
name of the Depositor to Invesco Capital Markets, Inc. Reference is
made to Exhibit 1.2.1 to the Registration Statement on Form S-6 of
Invesco Unit Trusts, Municipal Series 1130 (File No. 333-184264) dated
December 4, 2012.
1.3 By-laws of the Depositor. Reference is made to Exhibit 1.3 to the
Registration Statement on Form S-6 of Van Kampen Focus Portfolios,
Series 320 (File No. 333-75548) dated January 2, 2002.
1.4 Form of Dealer Agreement. Reference is made to Exhibit 1.4 to the
Registration Statement on Form S-6 of Van Kampen Unit Trusts,
Municipal Series 560 (File No. 333-122799) dated May 18, 2005.
1.5 Form of Master Agreement Among Underwriters. Reference is made to
Exhibit 1.5 to the Registration Statement on Form S-6 of Van Kampen
Unit Trusts, Municipal Series 560 (File No. 333-122799) dated May 18,
2005.
2.1 Form of Code of Ethics. Reference is made to Exhibit 2.1 to the
Registration Statement on Form S-6 of Van Kampen Unit Trusts,
Municipal Series 890 (File No. 333-165240) dated June 2, 2010.
3.1 Opinion and Consent of Counsel as to the legality of securities being
registered.
3.3 Opinion of Counsel as to the Trustee and the Trust.
4.1 Consent of Initial Evaluator.
4.2 Consent of Independent Registered Public Accounting Firm.
6.1 List of Officers and Directors of the Depositor. Reference is made to
Exhibit 6.1 to the Registration Statement on Form S-6 of Invesco Unit
Trusts, Series 1520 (File No. 333-201408) dated March 12, 2015.
7.1 Powers of Attorney. Reference is made to Exhibit 7.1 to the
Registration Statement on Form S-6 of Invesco Unit Trusts, Municipal
Series 1130 (File No. 333-184264) dated December 4, 2012, and Invesco
Unit Trusts, Series 1520 (File No. 333-201408) dated March 12, 2015.
UNDERTAKING TO FILE REPORTS
Subject to the terms and conditions of Section 15(d) of the Securities
Exchange Act of 1934, the undersigned registrant hereby undertakes to file with
the Securities and Exchange Commission such supplementary and periodic
information, documents, and reports as may be prescribed by any rule or
regulation of the Commission heretofore or hereafter duly adopted pursuant to
authority conferred in that section.
SIGNATURES
The Registrant, Invesco Unit Trusts, Municipal Series 1230, hereby identifies
Van Kampen Merritt Insured Income Trust, Series 1; Insured Municipals Income
Trust and Investors' Quality Tax-Exempt Trust, Multi-Series 189, Multi-Series
213 and Multi-Series 300; Van Kampen Merritt Emerging Markets Income Trust,
Series 1; Van Kampen Merritt Utility Income Trust, Series 1; Van Kampen Merritt
Equity Opportunity Trust, Series 1, Series 2, Series 4 and Series 7; Van Kampen
American Capital Equity Opportunity Trust, Series 13, Series 14, Series 57 and
Series 89; Van Kampen Focus Portfolios, Series 235, Series 265, Series 314,
Series 366 and Series 402; Van Kampen Focus Portfolios, Taxable Income Series
47; and Van Kampen Unit Trusts, Series 427, Series 450, Series 687, Series 855,
Series 894, Series 963, Series 984, Series 1027, Series 1050, Series 1129,
Series 1135, Series 1178, Series 1179, Series 1190, Series 1194, Series 1195,
Series 1198, Series 1201, Series 1203, Series 1205, Series 1272, Series 1275 and
Series 1279; and Invesco Unit Trusts, Series 1281 for purposes of the
representations required by Rule 487 and represents the following: (1) that the
portfolio securities deposited in the series as to the securities of which this
Registration Statement is being filed do not differ materially in type or
quality from those deposited in such previous series; (2) that, except to the
extent necessary to identify the specific portfolio securities deposited in, and
to provide essential financial information for, the series with respect to the
securities of which this Registration Statement is being filed, this
Registration Statement does not contain disclosures that differ in any material
respect from those contained in the registration statements for such previous
series as to which the effective date was determined by the Commission or the
staff; and (3) that it has complied with Rule 460 under the Securities Act of
1933.
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Invesco Unit Trusts, Municipal Series 1230, has duly caused this Amendment to
the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Chicago and State of Illinois on the
26th day of May, 2015.
INVESCO UNIT TRUSTS, MUNICIPAL SERIES 1230
BY: INVESCO CAPITAL MARKETS, INC., as Depositor
By: /s/ JOHN F. TIERNEY
-----------------------
Vice President
Pursuant to the requirements of the Securities Act of 1933, this Amendment to
the Registration Statement has been signed below on May 26, 2015, by the
following persons who constitute the principal officers and a majority of the
Board of Directors of Invesco Capital Markets, Inc.
SIGNATURE TITLE
Steven Massoni Director and Co-President
M. Kevin Cronin Director and Co-President
Mark W. Gregson Chief Financial Officer
By: /s/ JOHN F. TIERNEY
-----------------------
(Attorney-in-fact*)
----------------
* An executed copy of each of the related powers of attorney is filed
herewith or incorporated herein by reference as set forth in Exhibit 7.1.
Dates Referenced Herein and Documents Incorporated by Reference
| This ‘487’ Filing | | Date | | Other Filings |
|---|
| |  |
| | 1/1/17 | | None on these Dates |
| | 7/25/15 |
| | 5/29/15 |
| Filed on / Effective on: | | 5/26/15 |
| | 3/31/15 |
| | 3/12/15 |
| | 3/5/15 |
| | 6/30/14 |
| | 3/18/14 |
| | 7/17/13 |
| | 7/1/13 |
| | 6/30/13 |
| | 5/21/13 |
| | 5/10/13 |
| | 1/17/13 |
| | 12/4/12 |
| | 9/30/12 |
| | 7/23/12 |
| | 6/30/12 |
| | 6/11/12 |
| | 12/31/11 |
| | 12/19/11 |
| | 11/30/11 |
| | 8/5/11 |
| | 4/7/11 |
| | 12/31/10 |
| | 12/23/10 |
| | 12/22/10 |
| | 11/30/10 |
| | 11/23/10 |
| | 11/10/10 |
| | 11/8/10 |
| | 10/25/10 |
| | 9/29/10 |
| | 8/4/10 |
| | 7/28/10 |
| | 7/21/10 |
| | 7/20/10 |
| | 6/24/10 |
| | 6/7/10 |
| | 6/2/10 |
| | 3/26/10 |
| | 3/25/10 |
| | 3/5/10 |
| | 2/16/10 |
| | 2/4/10 |
| | 12/22/09 |
| | 12/1/09 |
| | 11/24/09 |
| | 11/12/09 |
| | 11/11/09 |
| | 11/9/09 |
| | 9/28/09 |
| | 8/20/09 |
| | 7/29/09 |
| | 7/28/09 |
| | 7/24/09 |
| | 7/1/09 |
| | 6/24/09 |
| | 6/15/09 |
| | 6/5/09 |
| | 4/27/09 |
| | 4/22/09 |
| | 4/13/09 |
| | 4/8/09 |
| | 3/24/09 |
| | 3/19/09 |
| | 3/12/09 |
| | 3/9/09 |
| | 2/18/09 |
| | 1/29/09 |
| | 1/22/09 |
| | 12/31/08 |
| | 12/19/08 |
| | 12/15/08 |
| | 11/24/08 |
| | 11/21/08 |
| | 11/19/08 |
| | 11/18/08 |
| | 11/7/08 |
| | 11/5/08 |
| | 10/28/08 |
| | 10/24/08 |
| | 8/8/08 |
| | 6/20/08 |
| | 6/19/08 |
| | 6/5/08 |
| | 5/20/08 |
| | 4/25/08 |
| | 4/11/08 |
| | 3/31/08 |
| | 3/6/08 |
| | 5/18/05 |
| | 1/2/02 |
| List all Filings |
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