I N D E N T U R E made the 13th day of April, 2004, by and between ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇, having an office at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ (sometimes
hereinafter referred to as the "Grantor"), and ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, residing at ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, residing at ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇ 16 East, White Plains, New York, and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
residing at ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, (sometimes hereinafter
referred to as the "Trustees").
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, the Grantor desires to create a trust of the property and for the
purposes hereinafter mentioned,
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the Grantor hereby transfers to the Trustees the property
listed in Schedule A annexed hereto, the receipt of which is hereby acknowledged
by the Trustees, and the Trustees agree to hold such property, IN TRUST,
NEVERTHELESS, for the uses and purposes, for the term, and subject to the
provisions, conditions, powers and agreements hereinafter set forth:
FIRST: From the date of this Indenture until the second anniversary of this
Indenture (the "trust term"), the Trustees shall pay the Annuity Amount (as
hereinafter defined) to the Grantor, or if the Grantor is not living, to the
legal
representatives of the Grantor's estate. The Annuity Amount shall be paid
annually on the day preceding the month and day on which this Indenture is
executed for each year during the trust term and on the last day of the trust
term. The Annuity Amount for each year shall be the following percentages of the
initial fair market value, as of the date of this Indenture, of the assets
contributed to fund the trust as finally determined for federal gift tax
purposes.
Year in Which Percentage of Initial
Anniversary Date Falls Fair Market Value
---------------------- ---------------------
2005 48.14404 %
2006 57.77285 %
In any event, the Annuity Amount for any year shall be paid not later than
105 days after the scheduled payment date for such year as hereinabove provided.
The Annuity Amount shall be paid from income and, to the extent income is not
sufficient, from principal. Any income not so paid shall be added to principal.
Payments of the Annuity Amount for a period of less than a full year shall be
prorated on a daily basis.
No additional contributions shall be made to the trust. The interest of the
Grantor shall not be subject to commutation. During the trust term, no payment
shall be made to any person other than the Grantor (or the Grantor's estate).
The Trustees shall not
issue a note, other debt instrument, option or other similar financial
arrangement in satisfaction of the annuity payment obligation. If an incorrect
payment of the Annuity Amount is made, the Trustees shall, promptly after the
error is discovered, pay to the Grantor or the Grantor's estate in the case of
an underpayment or collect from the Grantor or the Grantor's estate in the case
of an overpayment, an amount equal to the difference between the amount which
the Trustees should have paid the Grantor or the Grantor's estate and the amount
which the Trustees paid the Grantor or the Grantor's estate. The fiscal year of
the trust shall be the calendar year.
The Grantor intends to create a trust in which the Grantor retains the
right to receive a "qualified interest," as defined in section 2702(b)(1) of the
Internal Revenue Code and the Regulations thereunder, and this Indenture shall
be so interpreted and may be so amended by the Trustees in order to so qualify.
Upon the expiration of the trust term, the Trustees shall divide and set
apart the then principal and any undistributed income of this Trust (other than
any amount distributable to the Grantor or the Grantor's estate pursuant to the
preceding paragraphs of this Article) into three (3) equal shares. One (1) share
shall be paid to each of ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, if
they are then living; provided, however, that if any of ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇▇▇▇▇ or
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ is not then living but has issue then living, then his or her
share shall be paid to such issue in equal shares per stirpes; provided further,
however, that the Trustee hereinafter named shall hold, manage, invest and
reinvest each share or portion thereof payable to the Grantor's grandson,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, IN TRUST , and such share or portion thereof shall constitute
a separate trust and shall be disposed of in accordance with the provisions of
Article "SECOND" hereof (hereinafter referred to as the "Article 'SECOND'
Trust"), and the Trustee hereinafter named shall hold, manage, invest and
reinvest each share or portion thereof payable to the Grantor's granddaughter,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, IN TRUST , and such share or portion thereof shall constitute
a separate trust and shall be disposed of in accordance with the provisions of
Article "THIRD" hereof (hereinafter referred to as the "Article 'THIRD' Trust").
SECOND: Property directed to be disposed of as provided in this Article
"SECOND" shall be disposed of as follows:
A. During the lifetime of the Grantor's grandson, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
(hereinafter referred to as the "beneficiary"), the Trustee, at any time and
from time to time, may pay to or apply for the benefit of the beneficiary so
much, all or none of the net income and principal of the trust as the Trustee,
in his sole and absolute discretion, shall deem necessary or advisable.
B. Upon the death of the beneficiary, the then principal and
undistributed income, if any, of the trust shall be paid to the then living
issue of such beneficiary, in equal shares, per stirpes. If there are no such
issue of the beneficiary then living, the same shall be paid to the then living
issue of the Grantor's most remote descendant who is an ancestor of the deceased
beneficiary and who has issue then living, in equal shares, per stirpes, or if
none, to the Grantor's then living issue, in equal shares, per stirpes;
provided, however, any property which would otherwise pass outright under this
clause to a beneficiary for whom a trust is being held under Article "THIRD"
shall be added to the principal of such trust, to be administered and disposed
of as part thereof.
THIRD: Property directed to be disposed of as provided in this Article
"THIRD" shall be disposed of as follows:
A. During the lifetime of the Grantor's granddaughter, ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ (hereinafter referred to as the "beneficiary"), the Trustee, at any
time and from time to time, may pay to or apply for the benefit of the
beneficiary so much, all or none of the net income and principal of the trust as
the Trustee, in his sole and absolute discretion, shall deem necessary or
advisable.
B. Upon the death of the beneficiary, the then principal and
undistributed income, if any, of the trust shall
be paid to the then living issue of such beneficiary, in equal shares, per
stirpes. If there are no such issue of the beneficiary then living, the same
shall be paid to the then living issue of the Grantor's most remote descendant
who is an ancestor of the deceased beneficiary and who has issue then living, in
equal shares, per stirpes, or if none, to the Grantor's then living issue, in
equal shares, per stirpes; provided, however, any property which would otherwise
pass outright under this clause to a beneficiary for whom a trust is being held
under Article "SECOND" shall be added to the principal of such trust, to be
administered and disposed of as part thereof.
FOURTH: A. The Grantor nominates his son-in-law, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, as
Trustee of the Article "SECOND" Trust. If the Grantor's son-in-law, ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, is not then living, or fails to qualify or, having qualified, ceases
to act as Trustee for any reason whatsoever, then the Grantor nominates the
Grantor's granddaughter, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, in his place and stead.
B. The Grantor nominates the Grantor's son, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, as
Trustee of the Article "THIRD" Trust. If the Grantor's son, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, is
not then living, or fails to qualify or, having qualified, ceases to act as
Trustee for any reason whatsoever, then the Grantor nominates the Grantor's
grandson, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, in his place and stead.
FIFTH: With respect to any property distributable absolutely to an infant
remainderman, the Trustees in their sole and absolute discretion are authorized
to retain possession of and manage the same during such infant's minority, with
all the rights, powers and compensation of the Trustees hereunder, and from time
to time to apply so much of the income and principal thereof to the use of said
infant as they deem advisable, accumulating any balance of the income and adding
the same to principal at convenient intervals; upon said infant's attaining
majority (or upon his sooner death), the then principal and any accumulated
income shall be distributed to said infant (or his or her estate); this power
shall not affect the vesting of said property in said infant.
In determining the amount of income or principal applicable to the
use of an infant, the Trustees are authorized to disregard the ability of the
parent or parents of said infant to support said infant and to make payment of
any income or principal applicable to the use of or payable to an infant: (1) to
the Guardian (qualified in any jurisdiction) of the person or property of such
infant; (2) to the parent or parents of such infant (whether or not legally
appointed his or her Guardian); (3) to the extent permitted by law, to a
Custodian for such infant under a Uniform Gifts to Minors Act or a Uniform
Transfers to Minors Act; or (4) to apply the same for his or her benefit. The
receipt of such Guardian, parent or Custodian, or the evidence of
the application of such income or principal, shall be a full discharge to the
Trustees for such payment.
SIXTH: The Trustees shall have the following power and authority, which
shall be deemed supplemental to and not exclusive of the general powers and
authority of trustees pursuant to law and which may be exercised by them at any
time and from time to time as they in their absolute discretion deem advisable:
A. To hold and retain all or any part of the trust created hereby
in the form in which the same may be at the time of receipt by the Trustees
as long as they may deem advisable, without liability for any loss
resulting from lack of diversification. The Trustees shall be absolved and
exonerated from any individual responsibility for any loss which may result
to the trust in connection with their retention of any stock of Sequa
Corporation.
B. To invest and reinvest any funds in the trust created hereby in
any property, real or personal, of any kind or nature, including, without
limitation, stocks, whether common or preferred, or otherwise, bonds,
secured or unsecured obligations, mortgages, other securities, and
interests in any of the foregoing, improved or unimproved real property or
tangible personal property that they may, in their absolute discretion,
deem advisable, without regard to any duty to diversify or to make such
property productive of income, and
in any manner, including by direct purchase, entry into a joint venture,
creation of or purchase of an interest in any form of partnership or
corporation or through any other form of participation or ownership,
without being limited or restricted to investments prescribed or authorized
for trustees by the laws of New York or any other state.
C. To sell, exchange, partition or otherwise dispose of, any
property, real or personal, which may at any time form part of the trust
created hereby.
D. To borrow money in connection with the administration of the
trust created hereby; to execute promissory notes or other obligations for
amounts so borrowed or for the purchase of any property acquired by them,
and to secure payment of any such amounts by mortgage or pledge of any real
or personal property which may at any time form part of the trust created
hereby.
E. To make loans in such amounts, upon such terms, secured or
unsecured, at such rates of interest, and to such persons, firms or
corporations as they may deem advisable.
F. To renew or extend the time of payment of any obligation,
secured or unsecured, payable to the trust created hereby for as long a
period or periods of time and on such terms as they may determine; and to
adjust, settle,
compromise and arbitrate claims or demands in favor of or against the trust
created hereby.
G. In respect of any securities forming a part of the trust created
hereby, including but not limited to the stock of Sequa Corporation which
is contributed to the trust, to vote upon any proposition or election at
any meeting, and to grant proxies to vote at any such meetings; to join in
or become a party to any reorganization, readjustment, merger, voting
trust, consolidation or exchange, and to deposit any such securities with
any committee, depositary, trustee or otherwise, and to pay out of the
trust any fees, expenses and assessments incurred in connection therewith,
and to charge the same to principal; to exercise conversion, subscription
or other rights, or to sell or abandon such rights, and to hold any new
securities issued as a result of any such readjustment, merger, voting
trust, consolidation, exchange or exercise of conversion, subscription or
other rights.
H. Whenever they are required or permitted to divide or distribute
the trust created hereby, to make such division or distribution in kind or
in money, or in part kind and in part money, without the consent of any
beneficiary.
I. The powers herein granted to the Trustees are intended to allow
the Trustees to exercise the powers and discretion herein conferred as
fully and unrestrictedly as if there were no such conflicting interests.
The Grantor therefore expressly exempts the Trustees from the adverse
operation of any rule of law that might otherwise apply to them in the
performance of their fiduciary duties by reason of conflict of interest and
specifically directs that they shall not have any greater burden to justify
their acts as Trustees by reason of conflict of interest than they would
have in the absence of any conflict.
SEVENTH: Any Trustee hereunder at any time may resign as Trustee without
the permission of any court and without first accounting for his proceedings as
such Trustee, by executing an instrument in writing to that effect and
delivering the same to the other Trustee or Trustees, if any; to any person who
shall be successor to the Trustee so resigning; and to the person or persons who
are then entitled or eligible to receive the income of such trust or to the
guardian or guardians of any such person or persons who may then be under
disability, but such resignation shall not operate to relieve such Trustee of
his obligation ultimately to account for his proceedings as such Trustee.
If any Trustee is under a legal disability or by reason of illness
or mental or physical disability is, in the written opinion of two physicians
then practicing medicine, unable to properly manage his or her affairs, he or
she shall be deemed incapacitated for the purposes of this Indenture. Any
Trustee deemed incapacitated under the previous sentence shall be deemed
rehabilitated when he or she is no longer under a legal disability or when, in
the written opinion of two physicians then practicing medicine, he or she is
able to properly manage his or her affairs. Upon rehabilitation, the individual
shall resume the duties and powers he or she had prior to incapacity and his or
her successor or substitute Trustee shall relinquish all powers and be relieved
of all duties.
EIGHTH: The persons acting as Trustees hereunder, by a written instrument
signed and acknowledged by all Trustees then acting, are authorized at any time
to designate an individual or a series of individuals to act as substitute or
successor to any Trustee who shall die, resign, or cease to act as Trustee for
any reason. Except in the case of the Article "SECOND" Trust and the "Article
"THIRD" Trust, in the event there is a single Trustee acting hereunder at any
time, such Trustee shall appoint, by a duly signed and acknowledged written
instrument, a co-Trustee to act with him or her so that there are at least two
Trustees acting hereunder at all times. Only the Grantor's issue, who is not
the issue of any acting Trustee, may be appointed as a substitute or successor
Trustee. Any appointment of a successor or substitute Trustee pursuant to this
Article may be revoked or changed prior to its becoming effective. No bond or
other security shall be required of any Trustee or successor or substitute
Trustee. The Grantor and his wife, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, shall not serve as
Trustees hereunder.
No Trustee acting hereunder shall be entitled to compensation for
services as Trustee, but each Trustee shall be entitled to reimbursement for
expenses incurred in performing those services.
When more than one Trustee is acting hereunder, any Trustee may, by
a signed and acknowledged written instrument filed with the trust records and
delivered to the other Trustee or Trustees, delegate to any other Trustee from
time to time the exercise of all or any of the powers conferred by this
agreement, and during any period while such delegation is in effect, such
delegating Trustee shall have no further responsibility with respect to the
exercise of such powers. Any such delegation may be revoked by such delegating
Trustee by a signed and acknowledged written instrument so filed and delivered.
When more than one Trustee is acting hereunder, any instrument to
be executed on behalf of the Trustees, including any check issued by or to the
order of the Trustees, may be made,
executed, signed, endorsed or delivered by one of the Trustees, and any person,
firm or corporation, including any bank, may rely upon and shall be protected in
relying upon the signature of any Trustee so signing with the same force and
effect as though all Trustees had signed.
All persons dealing with the Trustees, and all other persons
relying upon or claiming under any instrument executed by the Trustees with
respect to any trust property, shall be entitled to rely conclusively upon a
Trustee's representations that the Trustee has the power to perform any act and
to execute any instrument and to consummate any transaction, that the trust is
in full force and effect, and that any instrument is executed in accordance with
the provisions of this trust and is binding upon all Trustees and beneficiaries
hereunder. No person dealing with the Trustees shall be obligated to see to the
application of any property paid or otherwise transferred to the Trustees, to
see that the terms of the trust have been complied with, to inquire into the
necessity or advisability of any act of the Trustees, or to inquire, or be
privileged to inquire, into any other matter.
The Trustees in carrying out their powers and performing their
duties may act in their discretion and shall be personally liable only for fraud
or acts or omissions in bad faith. The Trustees, however, shall never have
personal liability for making or failing to make any discretionary distributions
to any
beneficiary or any election under any tax law. The Trustees shall not personally
be liable for any act or omission of any agent or employee of the Trustees
unless the Trustees have acted in bad faith in the selection and retention of
such agent or employee. Any action undertaken by the Trustees shall be
conclusive and binding upon all beneficiaries hereunder, whether present or
future. No Trustee shall be liable for the acts or defaults of a co-Trustee.
Any successor or substitute Trustee at any time acting shall have
all of the rights, powers, duties and obligations of the original Trustees. No
bond or other security shall be required of any Trustee or successor or
substitute Trustee.
NINTH: Any references in this Indenture to the "issue", "children",
"grandchildren" and "descendants" of the Grantor shall not include the Grantor's
daughter, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, or any of her issue.
TENTH: No beneficiary shall, at any time, have the right to pledge or
assign any of the payments which may become due to him or her from time to time,
whether on account of principal or income, and any attempted pledge or
assignment shall be ignored by the Trustees nor shall any principal or income be
subject to attachment, garnishment or any other legal proceedings while in the
hands of the Trustees.
ELEVENTH: The Grantor declares that the trust hereby created is irrevocable
and that this Indenture may not be altered, amended or modified. The Grantor
shall have the right and power at any time to reacquire any asset of the trust
if he shall simultaneously substitute therefor other property having an
equivalent value. This power shall be exercisable by the Grantor in a
nonfiduciary capacity and without the consent of any person in a fiduciary
capacity.
TWELFTH: The trust created herein shall be governed by and construed in all
respects in accordance with the laws of the State of New York. The Trustees
shall not be required to account in any court outside of New York State.
THIRTEENTH: This instrument may be executed in two or more counterparts,
all of which, when taken together, shall constitute a single instrument.
FOURTEENTH: The Trustees, by joining in the execution of this instrument,
signify their acceptance of the said trust and agree to execute the same in
accordance with the terms of this Indenture.
IN WITNESS WHEREOF, the parties hereto have set their respective hands
as of the day and year first above written.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Grantor
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Trustee
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Trustee
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Trustee
SCHEDULE A
Property Contributed to Trust
125,385 shares of Sequa Corporation Class A Common Stock
347,438 shares of Sequa Corporation Class B Common Stock