THIS TRUST INDENTURE dated for reference the _____ day of ______________, 20______.
A. The Settlor desires to establish a Trust for the benefit of the Beneficiary, and has entered into this
Trust Indenture to witness the creation of the same, to establish its terms, and to define the rights
and obligations of the Trustee; and
B. The Trustee has agreed, subject to the terms hereof, to act as the trustee of the Trust.
NOW THEREFORE the parties hereby agree as follows:
CREATION OF THE TRUST
1.1 Name of the Trust
The Trust created by this Trust Indenture will be known as the ___________________________________
Trust. (name of the Trust)
1.2 Settlement of the Trust
The Settlor has settled upon the Trustee, and the Trustee acknowledges that the Settlor has settled upon it
those assets set forth on Schedule “A” attached hereto and forming part hereof upon the trusts herein
1.3 Acceptance of the Trust
The Trustee, by executing this Trust Indenture, accepts this Trust and the duties and obligations
1.4 Trust is Irrevocable
The Settlor may not revoke the Trust.
1.5 Trust May Not Revert
No part of the Trust Property may revert to the Settlor in his capacity as Settlor.
In this Trust Indenture:
(a) “Act” means the Income Tax Act, RSC 1985 (5th Supp.), c. 1, as amended together with all
regulations promulgated thereunder or any legislation substituted therefor.
(b) “ Beneficiary” means ___________________.
(c) “Beneficiary’s Estate” means the estate of ___________________.
(d) “company”, “corporation” or any similar word includes any form of organization such as a trust,
partnership, joint venture or otherwise, whether it is recognized as a separate legal entity and a
reference to a director, officer or other person in respect of a corporation includes a reference to
any similar person of any such organization.
(e) “Continuing Trustee” has the meaning referred to in Clause 6.8.
(f) “Division Date” means the earlier of the following:
(i) the day which is eighty (80) years from the date of creation of this Trust; and
(ii) the day immediately after the death of the Beneficiary.
(g) “Net Income” means all income computed without reference to the Act (and for greater certainty
not including capital gains) received by the Trust less the aggregate of:
(i) all expenses incurred or payable in respect of or to protect the Trust Property or incurred
or payable in connection with the management and administration of the Trust, as
determined by the Trustee to be chargeable to the income;
(ii) such other amounts in each year as the Trustee considers to be proper allowances,
reserves, deductions, disbursements and outgoings in accordance with international
generally accepted accounting principles applied on a consistent basis; and
(iii) without limiting the generality of the foregoing, such amounts in each year as the Trustee
considers necessary and advisable from time to time as being on account of depletion,
deterioration or obsolescence of any part of the Trust Property.
(h) “Proper Law of the Trust” means the law of the jurisdiction in which the Trustee is resident,
which will determine all matters in respect of the Trust.
(i) “Trust Property” means the following, which, for greater certainty shall be regarded as capital
(i) the property described in clause 1.2;
(ii) all property hereafter paid or transferred to or otherwise vested in and accepted by the
Trustee as additions to the Trust Property, and of which a Memorandum endorsed
hereon will be conclusive evidence;
(iii) all Net Income accumulated by the Trustee and added to the Trust’s capital; and
(iv) all money, investments and other property from time to time representing or substituted
for the property referred to in paragraphs (i) and (ii) above and the said additions and
accumulations or any part or parts thereof respectively.
(j) “Trustee” means:
(i) the original Trustee as at the date of execution; and
(ii) any other person appointed as trustee of this Trust, including a Continuing Trustee.
(k) “Trust’s Year End” means December 31 of any calendar year.
(l) “writing” or any term associated therewith includes email and fax, provided the email address or
fax number to which the writing is addressed has been previously supplied by the recipient of
the writing to the sender of the writing and not thereafter changed.
Unless the context indicates otherwise, the singular includes the plural and vice versa, any gender
includes both genders and references to person and persons include a corporation or corporations. The
title and subtitles of this Trust Indenture may not be used to interpret or construe this Trust Indenture.
The Trustee will hold the Trust Property in trust for the Beneficiary and administer it as follows:
(a) Income Interests.
(i) The Trustee will invest and keep invested the Trust Property separate from all other
property owned or held by it absolutely or in trust or in any other form. Until the
Division Date, the Trustee must pay, in respect of each year, all Net Income to or for the
benefit of the Beneficiary, to the extent the Beneficiary demands in writing the payment
of such income for such year.
(ii) The Trustee will accumulate any amount or amounts of the Net Income not paid in
accordance with Clause 3.1(a)(i), or segregated for distribution, within thirty (30) days
after the Trust’s Year End and will add such amount or amounts to the Trust Property.
(b) Discretionary Capital Interest.
Until the Division Date, the Trustee may encroach on the Trust Property (including to such an
extent that the Trust Property is completely used up) and pay or transfer any amount or amounts
of the Trust Property to or for the benefit of the Beneficiary at such times and in such amounts as
the Trustee may determine.
(c) Distribution on Division Date.
On the Division Date, the Trustee will pay or transfer the whole of the Trust Property then
remaining to or for the benefit of the Beneficiary’s Estate, to be dealt with in accordance with the
terms of the Beneficiary’s will, or where he dies without a valid will, according to the laws of
intestacy governing the Beneficiary’s Estate.
(d) Cessation of Trust.
The Trust will cease and determine after the Trustee fulfills its duty under Clause 3.1(c).
TRUSTEE’S POWERS AND AUTHORITIES
4.1 Preamble/Saving Clause
Without limiting or derogating from the powers, authorities, discretions and immunities otherwise
available to the Trustee, whether under any statute or law or otherwise, the Trustee has the following
powers and authorities:
A. POWERS OF DISPOSITION
4.2 Invest Trust Property
To make or retain any investment or investments that it considers advisable, whether authorized
by law for trustees.
4.3 Make Payments, Provisions, Apportionments or Distributions Based on Trustee’s Valuation
To make any payments, provisions, apportionments or distributions that may be required or
permitted hereunder in whole or in part in moneys, securities or other property comprising the
Trust Property. Every apportionment and distribution, and valuation therefor, that the Trustee
determines is equitable, will be binding on all persons interested.
B. POWERS OF ADMINISTRATION
4.4 Retain any Property
To retain any property belonging to or forming part of the Trust Property in the actual state or
condition in which it received it as long as it determines.
4.5 Sell any Property
To dispose of all or any part of the Trust Property in such manner and under such conditions as it
determines and to receive the consideration and grant discharges therefor.
4.6 Exchange Property
To exchange Trust Property for other property of a like or different nature for such consideration
and on such conditions as it determines.
4.7 Lease Real Property
To lease at any time and from time to time real property or any interest in real property entrusted
to it or from time to time held by it under such conditions as it determines, whether the term of
the lease exceeds beyond that authorized by law and beyond the Division Date.
4.8 Improve, Manage, Repair, etc. the Trust Property
To manage real or leasehold property entrusted to it or from time to time held by it, and to make
such ordinary and extraordinary repairs and such alterations and improvements thereon as it
determines; to raise buildings and erect new buildings; to subdivide and plot real property, to lay
out and dedicate ways, roads and public places, to grant or release easements and enter into
partitions, party wall and boundary line agreements and agreements of any other kind with
respect to real property; to make payment for such repairs, alterations and improvements or
services or in connection with such management out of capital or out of income or partly out of
capital and partly out of income, as it determines; to renew and hold renewed any mortgage or
mortgages, and to borrow money for refunding any mortgage or mortgages; and generally to
manage such real or leasehold property.
4.9 Exercise Voting Powers
To exercise all voting powers attaching to any shares, stocks, debentures, or other securities held
4.10 Voting by Proxy
To appoint a person or persons as its proxy to vote shares, stocks, debentures, or other securities
held by it.
4.11 Vote to Compensate Directors
To exercise or concur in exercising the voting and other rights attaching to any securities held by
it so that a Trustee or person who is a director and/or shareholder of a Trustee and becomes a
director or other officer or employee of any company, is paid for its or his own use and benefit
such reasonable remuneration for services to that company.
4.12 Deal with Shares
To deal with (including the sale of) any securities of any company held by it or the shares or
assets of any company with which such company is merged or amalgamated.
4.13 Acquire Participations
To acquire shares, stocks, debentures, debenture stock, securities, interests, or rights of
whatsoever nature in or over any company the securities of which form part of the Trust
4.14 Grant Options
To grant options on such conditions as it determines for the purchase of any Trust Property or the
acquisition of any interest therein.
4.15 Become a Party to a Voting Agreement
To become a party to any voting trust or deposit agreement and to deposit any securities and
property held by it with any protective reorganization or similar committee or any voting trust or
with any depository designated therein.
4.16 Institute and Defend Proceedings
To institute, defend, determine, or compromise any proceeding on such terms as it determines.
4.17 Pay Duties and Taxes
To pay any tax, duty or other fiscal liability that is or may be claimed in any part of the world
from it or that is or may be claimed in any part of the world from any person who is or has been
or may become beneficially interested in the income or capital of the Trust (including a person
interested as the object of a discretion or power) in respect of or by reference to such interest or
from the estate of any deceased person who has been interested as aforesaid, notwithstanding
that any such claim may not be enforceable by action in any jurisdiction in which a Trustee is
incorporated or resident or carries on business or in which any assets then comprised in the Trust
Property are situated.
4.18 Consent to a Reorganization
To consent to any reorganization or reconstruction of any company, the securities of which form
part of the Trust Property, and to consent to any reduction of capital or other dealing with such
securities as it determines.
4.19 Incorporate any Company
To incorporate or create any company or corporation in any jurisdiction.
4.20 Invest in Corporations and Enter into Contracts
To carry on, participate or invest in any corporation and to enter into such leases, contracts or
other undertakings relating to the Trust Property, or any part of it, as it determines,
notwithstanding that such leases, contracts or undertakings extend or may extend beyond the
4.21 Employ Professionals
To employ and pay for such professional assistance as it requires to discharge its duties as
Trustee, including assistance from a partner of a Trustee or from a person who is a director
and/or shareholder of a company which is a Trustee.
4.22 Borrow Money
To borrow at any time or times any moneys required for any purpose connected with the
administration of the Trust Property on such conditions as it determines and the Trustee may for
the purpose mortgage or charge in favour of the lender the whole or any part of the Trust
Property or any interest therein.
4.23 Act as Surety or Guarantor
To act as surety or guarantor or to grant any bond to secure any debt or other obligation of any
person, or to undertake or give any indemnity with respect to any debt or other obligation of any
such person, on such conditions as it determines, and to mortgage, charge or otherwise
hypothecate all or any part of the Trust Property to secure the performance of any surety,
guarantee, bond, covenant or indemnity given, made or undertaken by it, and to apply the whole
or any part of the Trust Property in or towards payment of any liability undertaken by it under
4.24 Lend Money
To lend the Trust Property, or any part thereof, on such terms as it determines.
To carry insurance against hazards, including public liability, in such amounts and in such form
or forms as it determines.
4.26 Call upon the Court for Direction
Subject to Clause 4.27, the Trustee may, without the institution of a suit, apply to a court of
competent jurisdiction for the opinion, advice or direction of the court on any question respecting
the Trust. The Trustee will not be responsible for any loss resulting from its reliance on the
court’s opinion, advice, or direction.
4.27 Trustees Acting Jointly
If there is more than one Trustee, then any decision in respect of the Trust must be made
unanimously by the Trustees.
TRUSTEE’S PRIVILEGES, RIGHTS AND DUTIES
5.1 Act through Agents
The Trustee need not act personally and may act through managers or employ any contractor, manager,
solicitor, accountant, clerk, workman, employee or servant or any agent to transact all or any business
which it is required or permitted to do and the Trustee will decide the remuneration to be allowed and
paid and may pay the same and all charges and expenses so incurred first out of the Trust’s income and
then out of the Trust Property.
5.2 Use of Banks and Brokers
The Trustee may at any time and from time to time deposit the securities or documents of title to
property held by it with a bank, trust company, investment managers and brokers or like institutions in
any jurisdiction and may delegate to such bank, trust company, investment managers and brokers or
other like institutions such of the trusts and powers hereby or by law vested in the Trustee with reference
to the securities or documents so deposited as the Trustee determines, and the Trustee will not be liable
or responsible for any loss (not caused by its own negligence or fraud) that occurs in relation thereto.
5.3 Trustee May Act as Officer or Employee
A Trustee and any officer or employee of a corporate Trustee may act as an officer, manager or employee
of any company, the shares or debentures of which form part of the Trust Property, or as an officer,
manager or employee of any subsidiary or holding company of any such company, and may retain for
itself any remuneration which it may receive as such officer, manager or employee.
The expenses in connection with the administration of this Trust including (subject to Clause 5.5(b))
remuneration and charges of the Trustee and of the investment and re-investment of any part of the Trust
Property and the collection of income and other sums derivable therefrom must be paid first out of the
Trust’s income and then out of the Trust Property. The foregoing does not apply to the extent the Trustee
determines that an expense is properly chargeable against the capital of the Trust.
5.5 Trustee Remuneration
(a) The Trustee will act in accordance with his standard terms and conditions now and from time to
time in force and will be entitled to charge and be paid for its services as Trustee first out of the
Trust’s income and then out of the Trust Property in accordance with its scale of fees now and
from time to time in force.
(b) Clause 5.5(a) does not apply to the extent the Trustee is entitled to be paid by a person (other
than the Trust) under an agreement with that person.
The accounts of the Trust must be prepared based on international generally accepted accounting
principles consistently applied not less than once per year and will either be audited or unaudited as the
Trustee may from time to time determine.
5.7 Trustees May Charge as Professional
A Trustee that is a bank, chartered accountant, solicitor or other person or corporation engaged in any
profession or business, is entitled to charge and be paid all normal professional or other charges for
services rendered by him or his firm or it, in relation to the Trust, over and above the fee for acting as
Trustee, on the same terms as would be made with a customer.
5.8 Control over Companies
(a) The Trustee is not required to exercise any control it has over or to interfere in or become
involved in the administration, management or conduct of the business or affairs of a company in
which the Trust holds shares (in Clause 5.8 called a “Company”).
(b) The Trustee must leave the administration, management and conduct of the business and affairs
of a Company to the directors, officers and other persons authorized to take part in the
administration, management or conduct thereof and the Trustee is not required to supervise such
directors, officers or other persons so long as the Trustee does not have actual knowledge of any
dishonesty relating to such business and affairs on the part of such persons.
(c) The Trustee is not liable for any loss to a Company or the Trust Property or the income thereof
arising from any act or omission of the directors, officers or other persons taking part in the
administration, management and conduct of the business or affairs of a Company, unless the
Trustee did not properly supervise such persons where the Trustee had actual knowledge of any
dishonesty relating to such business and affairs on the part of such persons.