REVOCABLE LIVING TRUST AGREEMENT

(Alabama – Draft Template)

[// GUIDANCE: This template is intentionally comprehensive. Delete bracketed guidance and fill all [PLACEHOLDER] fields before execution. Confirm all statutory cites and customize dispositive provisions to client objectives.]

TABLE OF CONTENTS

1. I. Document Header
2. II. Definitions
3. III. Operative Provisions
4. IV. Representations & Warranties
5. V. Covenants & Restrictions
6. VI. Default & Remedies
7. VII. Risk Allocation
8. VIII. Dispute Resolution
9. IX. General Provisions
10. X. Execution Block
11. Schedule A Initial Trust Property
12. Schedule B Successor Trustee Acceptance
13. Schedule C Assignments & Deeds of Transfer

Page numbers intentionally omitted for post‐customization insertion.

I. DOCUMENT HEADER

1. Title & Parties
   This Revocable Living Trust Agreement (“Agreement”) is made effective as of [EFFECTIVE DATE] (the “Effective Date”) by and between:
   • [SETTLOR LEGAL NAME], an individual residing at [ADDRESS] (“Settlor” or “Grantor”); and
   • [INITIAL TRUSTEE LEGAL NAME], [individual | Alabama banking corporation | etc.] (“Trustee”).

2. Recitals
   A. Settlor desires to create a revocable inter vivos trust under Alabama law for estate planning, asset management, and family wealth transfer purposes.
   B. Trustee is willing to hold, administer, invest, and distribute the Trust Estate in accordance with the terms herein.
   C. This Agreement is intended to satisfy the requirements of the Alabama Uniform Trust Code, ALA. CODE §§ 19-3B-101 et seq.

3. Consideration
   In consideration of the mutual covenants herein and the transfer of property described in Schedule A, the parties agree as follows.

II. DEFINITIONS

Capitalized terms shall have the meanings below. Terms defined in singular include the plural and vice versa.

“Accounting Period” – Each calendar year ending December 31 or such other period agreed in writing by Settlor and Trustee.

“Alabama UTC” – The Alabama Uniform Trust Code, ALA. CODE Title 19, Chapter 3B.

“Beneficiary” – Any person or entity entitled to present or future distributions under this Agreement, including contingent and remainder beneficiaries.

“Code” – The Internal Revenue Code of 1986, as amended.

“Disability” – Settlor’s incapacity, as certified in writing by two licensed physicians, or as adjudicated by a court of competent jurisdiction.

“Trust Estate” – All property, tangible and intangible, held subject to this Agreement, together with all substitutions, additions, and accretions.

“Trustee” – The Original, Co-, and any Successor Trustee acting hereunder.

[Add additional terms as required.]

III. OPERATIVE PROVISIONS

3.1 Creation; Name

Settlor hereby establishes the “[SETTLOR NAME] Revocable Living Trust” (the “Trust”) pursuant to Ala. Code § 19-3B-401 and transfers to Trustee the property listed on Schedule A contemporaneously herewith.

3.2 Trust Property; Additional Contributions

Settlor may transfer additional property to the Trust at any time by assignment, deed, beneficiary designation, or other valid conveyance. All such property shall become part of the Trust Estate without further act.

[// GUIDANCE: Use Schedule C for deeds, stock assignments, etc. to satisfy asset-transfer formalities.]

3.3 Reserved Rights of Settlor

a. Revocation or Amendment – Settlor may revoke or amend this Trust in whole or in part by a writing signed by Settlor and delivered to Trustee during Settlor’s lifetime, consistent with Ala. Code § 19-3B-602.
b. Beneficial Rights – During Settlor’s lifetime and capacity, Settlor retains full beneficial ownership and may direct Trustee regarding investments or distributions.
c. Disability – Upon Settlor’s Disability, Trustee shall administer the Trust for Settlor’s benefit, applying so much of income and principal as Trustee deems necessary for Settlor’s health, support, maintenance, and comfort.

3.4 Lifetime Distributions

Unless otherwise directed by Settlor, Trustee shall distribute net income to Settlor at least annually and may distribute principal for Settlor’s needs under the ascertainable standard above.

3.5 Post-Death Disposition

[// GUIDANCE: Tailor to client; sample residuary disposition below.]

Upon Settlor’s death, and after payment of final expenses, taxes, and enforceable debts:
1. Specific Bequests – Trustee shall distribute the following:
a. [DESCRIPTION] to [BENEFICIARY];
b. [DESCRIPTION] to [BENEFICIARY].
2. Residuary Trust – The remaining Trust Estate shall be held in further trust for the benefit of [PRIMARY BENEFICIARY], with discretionary income and principal distributions for health, education, maintenance, and support (“HEMS”). Upon [trigger], distribute outright to [remaindermen] in equal shares, per stirpes.

3.6 Spendthrift Protection

To the maximum extent allowed by Ala. Code §§ 19-3B-502-505, the interest of any Beneficiary other than Settlor shall be held subject to a spendthrift provision, and shall not be alienated, anticipated, or subject to claims of creditors until actually received.

3.7 Powers of Appointment

Settlor grants [BENEFICIARY] a limited testamentary power to appoint any portion of his/her subtrust among Settlor’s descendants.

3.8 Trust Termination

Unless sooner revoked, this Trust shall terminate upon final distribution of the Trust Estate, whereupon Trustee shall be discharged.

IV. REPRESENTATIONS & WARRANTIES

4.1 Settlor

a. Capacity – Settlor represents he/she has full legal capacity under Ala. Code § 19-3B-601.
b. Title – Property listed on Schedule A is owned free of liens other than those disclosed in writing to Trustee.

4.2 Trustee

a. Acceptance – Trustee accepts the trusteeship and acknowledges fiduciary duties under Ala. Code §§ 19-3B-801-814.
b. No Conflict – No disqualifying conflict of interest exists.

[// GUIDANCE: Add corporate authority reps if trustee is an institution.]

V. COVENANTS & RESTRICTIONS

5.1 Affirmative Covenants of Trustee

1. Fiduciary Standard – Administer the Trust as a prudent person would, consistent with Ala. Code § 19-3B-804 and the Alabama Prudent Investor Act, Ala. Code §§ 19-3B-901 et seq.
2. Records & Reporting – Maintain full and accurate books; deliver annual statements within 90 days after each Accounting Period and interim statements upon reasonable request.
3. Tax Compliance – File all required federal and state tax returns; elect grantor-trust status unless directed otherwise.

5.2 Negative Covenants

Trustee shall not:
a. Engage in self-dealing except as expressly authorized herein or by court order.
b. Make speculative investments beyond the prudent investor standards.

5.3 Notice & Cure

If any Beneficiary alleges Trustee default, written notice shall be given describing the breach. Trustee shall have 30 days to cure before remedies may be sought.

VI. DEFAULT & REMEDIES

6.1 Events of Default

a. Breach of fiduciary duty;
b. Failure to render accounting within required time;
c. Insolvency or resignation without qualified successor.

6.2 Remedies

1. Removal – Any Beneficiary or co-trustee may petition the [COUNTY] Probate Court for removal under Ala. Code § 19-3B-706.
2. Surcharge – Trustee may be surcharged for damages proximately caused by breach, limited per Section 7.2.
3. Injunctive Relief – Immediate injunctive relief is available to prevent waste or misappropriation of Trust assets.

6.3 Attorney Fees

Reasonable attorney fees and expenses incurred in enforcing this Agreement shall be chargeable against the Trust Estate, except where Trustee is found to have committed gross negligence or willful misconduct.

VII. RISK ALLOCATION

7.1 Indemnification of Trustee

Trustee, and its agents, shall be indemnified out of the Trust Estate for all claims, losses, liabilities, and expenses (including reasonable attorney fees) arising out of the proper administration of the Trust, except to the extent resulting from Trustee’s gross negligence, bad faith, or willful misconduct.

7.2 Limitation of Liability

Trustee’s liability shall not exceed the value of the Trust Estate managed by Trustee at the time the liability arises. No personal liability shall attach to Trustee for obligations incurred as Trustee.

7.3 Insurance

Trustee may purchase fiduciary liability insurance, premiums chargeable to income or principal in Trustee’s discretion.

7.4 Force Majeure

Trustee shall not be liable for delays or failures caused by events beyond its reasonable control, including acts of God, war, cyber-attacks, or changes in applicable law.

VIII. DISPUTE RESOLUTION

8.1 Governing Law

This Agreement and all disputes hereunder shall be governed by and construed in accordance with the laws of the State of Alabama (without regard to conflict-of-laws principles).

8.2 Forum Selection

Exclusive jurisdiction for all matters concerning the Trust shall lie in the probate court of the county where this Trust is administered (the “Designated Probate Court”).

8.3 Arbitration (Optional)

[OPTION A – STRIKE IF NOT ELECTED]
Any dispute that a party elects to submit to arbitration shall be resolved by binding arbitration in [CITY], Alabama, in accordance with the Commercial Arbitration Rules of the American Arbitration Association. The arbitrator shall have authority to grant equitable relief consistent with this Agreement. Judgment may be entered in the Designated Probate Court.

8.4 Waiver of Jury Trial

Pursuant to Ala. Code § 12-13-1, actions concerning trusts are triable without a jury. Each party knowingly waives any right to a jury trial to the extent such right may exist.

8.5 Preservation of Injunctive Relief

Nothing in this Article limits any party’s right to seek temporary, preliminary, or permanent injunctive relief from the Designated Probate Court to protect Trust assets.

IX. GENERAL PROVISIONS

9.1 Amendment & Waiver

No provision may be amended or waived except by a written instrument signed by Settlor (if living) and Trustee. No waiver shall constitute a continuing waiver unless expressly stated.

9.2 Revocation

Settlor may revoke this Trust pursuant to Section 3.3(a). Upon revocation, Trustee shall reconvey the Trust Estate to Settlor, subject to fees, expenses, and liabilities properly chargeable to the Trust.

9.3 Assignment

No Beneficiary may assign, pledge, or otherwise transfer any interest in the Trust except as expressly permitted herein.

9.4 Successors & Assigns

This Agreement shall be binding upon and inure to the benefit of Settlor, Trustee, and their respective successors and assigns, including any duly appointed Successor Trustee per Section 9.7.

9.5 Severability

If any provision is held invalid, the remaining provisions shall remain in full force, and the invalid provision shall be modified to the minimum extent necessary to comply with applicable law.

9.6 Integration

This Agreement, together with Schedules A–C, constitutes the entire understanding and supersedes all prior agreements concerning the Trust.

9.7 Successor Trustee Rules

a. Designation – Settlor appoints [FIRST SUCCESSOR TRUSTEE] as first Successor Trustee and [SECOND SUCCESSOR TRUSTEE] as second Successor Trustee.
b. Vacancy – If no designated successor is willing or able to serve, a majority of the adult income beneficiaries may appoint a qualified individual or corporate fiduciary under Ala. Code § 19-3B-704.
c. Acceptance – Acceptance of trusteeship shall be evidenced by signing the Acceptance in Schedule B.
d. Powers – Each Successor Trustee shall have all powers granted to the original Trustee.

9.8 Counterparts; Electronic Signatures

This Agreement may be executed in counterparts, each deemed an original and together constituting one instrument. Electronic signatures shall be deemed originals for all purposes under the Alabama Uniform Electronic Transactions Act, Ala. Code §§ 8-1A-1 et seq.

X. EXECUTION BLOCK

IN WITNESS WHEREOF, Settlor and Trustee execute this Revocable Living Trust Agreement as of the Effective Date.

SETTLOR / GRANTOR

[SETTLOR LEGAL NAME]

Date: _______

TRUSTEE

[TRUSTEE LEGAL NAME & TITLE]

Date: _______

Notary Acknowledgment

State of Alabama )
County of [_]) ss.:

On this _ day of _, 20__, before me, the undersigned Notary Public, personally appeared [SETTLOR NAME] and [TRUSTEE NAME], personally known to me or proved on the basis of satisfactory evidence to be the person(s) whose name(s) are subscribed to the foregoing instrument, and acknowledged that they executed the same for the purposes therein contained.

Notary Public

My Commission Expires: _______

[// GUIDANCE: Alabama does not mandate notarization for trust validity, but notarization is strongly recommended, and is required for any deed transferring real property into the Trust.]

SCHEDULE A

Initial Trust Property
1. Cash – $[AMOUNT] deposited to [ACCOUNT NO.] at [INSTITUTION].
2. Real Property – [LEGAL DESCRIPTION] located at [ADDRESS], Alabama.
3. Marketable Securities – [LIST].
4. Tangible Personal Property – See attached inventory.

[Add or modify items as needed.]

SCHEDULE B

Successor Trustee Acceptance

I, [SUCCESSOR TRUSTEE NAME], hereby accept appointment as Successor Trustee under the Revocable Living Trust Agreement dated [EFFECTIVE DATE] and agree to be bound by all terms thereof.

Signature & Date

SCHEDULE C

Assignments, Deeds, and Other Transfer Instruments

[Attach executed deeds, stock power forms, membership interest assignments, beneficiary designations naming the Trust, etc.]

[// GUIDANCE: Complete all necessary state-law transfer documents promptly to ensure assets are legally titled in Trustee’s name.]

© [YEAR] [LAW FIRM NAME]. All rights reserved.
This template is provided for attorney use only and requires independent legal review before client implementation.