DECLARATION OF TRUST
THIS DECLARATION OF TRUST, made October 31, 1995 (this "Declaration"), by and
among AMERICAN INCOME 2 LIMITED PARTNERSHIP, a Massachusetts limited
partnership, as grantor (the "Grantor" or the "Partnership"), AFG LEASING
ASSOCIATES, a Massachusetts partnership, as trustee (in such capacity, together
with its successors as Trustee hereunder, the "Trustee") and the general and
limited partners of the Grantor as beneficiaries (the "Beneficiaries").
Preliminary Statement
The Partnership is being terminated in accordance with the Amended and
Restated Agreement and Certificate of Limited Partnership of the Partnership
dated as of December 28, 1983, as amended from time to time through the date
hereof (as so amended, the "Partnership Agreement"). Capitalized terms used and
not otherwise defined herein have the respective meanings set forth in the
Partnership Agreement.
In accordance with the Partnership Agreement, the Grantor intends to
deposit in a non-interest bearing custodian account (the "Account") funds (the
"Funds") in an amount sufficient in the judgment of the Trustee, to satisfy any
remaining liabilities of the Partnership (the "Liabilities") and thereafter to
distribute the balance of the Funds in the Account, if any (the "Net Funds"), to
the Beneficiaries.
NOW, THEREFORE, in consideration of the premises and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. Establishment of Trust; Name
A trust is hereby established to be known as the American Income 2
Limited Partnership Liquidating Trust (the "Trust")
2. Beneficiaries
The Beneficiaries of the Trust are the general and limited partners of
the Grantor and their respective percentage interests in the Funds and the Net
Funds (the "Respective Interests") are their respective Interests in the
termination distributions of the Partnership, as provided in the Partnership
Agreement.
3. Trust Property
(a) The Grantor hereby assigns, transfers and conveys to the Trustee, in
trust, all right, title and interest of theGrantor in and to the Funds.
(b) The Trustee shall hold the Funds in order to pay for any Liabilities in
accordance with Article VI of thePartnership Agreement and thereafter to
distribute the Net Funds to the Beneficiaries in accordance with their
Respective Interests.
(c) The Trustee shall not otherwise deal with the Funds unless directed by a
majority-in-interest of theBeneficiaries.
4. Acts of Trustees
(a)Except as expressly provided herein, the Trustee shall have no power to
deal in or with the Funds.
(b) Notwithstanding any provisions contained herein, the Trustee shall never
be required to take any action which will, in its opinion, cause it to incur any
personal liability unless first indemnified to its satisfaction. The Funds will
be available for purposes of indemnification. Any Person dealing with the
Trustee shall be fully protected in accordance with the provisions of Section 7.
5. Termination of Trust
This Trust shall terminate within a reasonable period of time after all
Liabilities of the Partnership have been satisfied in full in the judgment of
the Trustee but in any event no later than December 31, 2002. Upon such
termination, the Trustee shall transfer and convey the balance of the Net Funds
in the Account to the Beneficiaries in proportion to their Respective Interests.
6. Resignation and Succession
(a) The Trustee may resign at any time, and any Trustee may be
removed at any time by the majority-in-interest of the Beneficiaries.
(b) The cessation of service by any Trustee (whether resulting from the
death, incapacity, resignation or removal of such Trustee for any other cause)
shall be evidenced by a certificate thereof signed by the Beneficiaries and the
appointment of a succeeding Trustee shall be evidenced by a certificate signed
by the succeeding Trustee. The Beneficiaries shall have the power to appoint one
or more successor Trustees hereunder.
(c) Upon the appointment or succession of any succeeding Trustee to the
position of Trustee hereunder, title to the Funds and all portions thereof shall
thereupon be vested in said succeeding Trustee without the necessity of any
conveyance or instrument. Each succeeding Trustee shall have all of the rights,
powers, authority, and privileges as if named as the original Trustee hereunder;
and no Trustee, original or succeeding, shall be required to furnish a bond or a
surety on a bond.
7. Compensation; Liability and Authority
(a)No compensation will be paid to any Trustee hereunder.
(b) No Trustee hereunder shall be liable for any error of judgment nor for
any loss arising out of any act or omission in good faith, but shall be
responsible only for his own willful breach of trust. No license of court shall
be requisite to the validity of any transaction entered into by the Trustee.
(c) Every agreement or other instrument executed by the Trustee shall be
conclusive evidence in favor of every person relying thereon or claiming
thereunder that, at the time of the delivery thereof, this Trust was in full
force and effect and that the execution and delivery thereof was duly authorized
hereunder. Any person dealing with the Trustee may always rely, without further
inquiry, on a certificate signed by the Trustee hereof, as to who is the
Trustee, or as to the authority of the Trustee to act, or as to the existence or
non-existence of any fact or facts which constitute conditions precedent to acts
by the Trustee, or which are in any other way germane to the affairs of this
Trust.
8. Amendment
This Declaration may be amended from time to time by an instrument in
writing, signed by all of the then Beneficiaries and by the then Trustee hereof.
9. Execution
The execution of a counterpart of this Declaration or any other
instrument referred to herein by any one or more of the parties thereto shall be
binding upon the signatories thereto whether or not other parties have executed
the same counterpart, provided each party thereto has executed at least one
counterpart of such instrument.
10. Liquidating Trust
The Grantor, the Trustee and the Beneficiaries intend that this Trust
shall be liquidating trust under the Code and Regulation Section 301.7701-4(d)
thereunder which has been formed with the objective of liquidating the Trust
property. The Grantor, the Trustee and Beneficiaries do not intend that this
Trust shall carry on a profit-making business.
EXECUTED UNDER SEAL, as of the date first above written.
GRANTOR TRUSTEE
AFG LEASING ASSOCIATES AFG LEASING ASSOCIATES
By: AFG Leasing Incorporated, By: AFG Leasing Incorporated,
a general partner a general partner
By: By:
Geoffrey A. MacDonald Geoffrey A. MacDonald
BENEFICIARIES
Each of those persons listed as General and Limited Partners in Schedule A to the Partnership
By:
AFG Leasing Incorporated, as general partner of and for AFG Leasing
Associates, for itself and as an attorney-in-fact for each of the
above-named Limited Partners