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EXHIBIT 10.4
EMPLOYEE STOCK OWNERSHIP PLAN
TRUST AGREEMENT
Between
▇▇▇▇▇▇▇ COMPANY
and
STATE STREET BANK AND TRUST COMPANY
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TABLE OF CONTENTS
PAGE
RECITALS 1
ARTICLE I DEFINITIONS 2
ARTICLE II ESTABLISHMENT OF THE TRUST 3
ARTICLE II POWERS OF TRUSTEE 5
ARTICLE III ADMINISTRATION 14
ARTICLE V PAYMENTS OF BENEFITS AND EXPENSES 15
ARTICLE VI LIABILITY AND INDEMNIFICATION
OF THE TRUSTEE 18
ARTICLE VII ACCOUNTING OF THE TRUSTEE 20
ARTICLE VIII REMOVAL AND RESIGNATION OF THE TRUSTEE 23
ARTICLE IX AMENDMENT AND TERMINATION 24
ARTICLE X LEVERAGED ACQUISITIONS OF QUALIFYING STOCK 25
ARTICLE XI MISCELLANEOUS 27
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EMPLOYEE STOCK OWNERSHIP PLAN
TRUST AGREEMENT
THIS AGREEMENT has been made as of the second day of September, 1997,
between ▇▇▇▇▇▇▇ Company, a corporation organized under the laws of the State of
Delaware with its principal place of business in Atlanta, Georgia (hereinafter
referred to as the "Company") and State Street Bank and Trust Company, a
Massachusetts trust company with its principal place of business at ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ (hereinafter referred to as the "Trustee").
RECITALS
WHEREAS, the Company has adopted the Employee Stock Ownership Plan (the
"Plan") effective January 31, 1988 for the benefit of certain employees of the
Company and its affiliates; and
WHEREAS, the Plan provides for the establishment of a trust (the
"Trust") to hold, invest and administer amounts contributed under the Plan; and
WHEREAS, in order to effectuate the Plan, the Company has previously
established a Trust, designed to meet the applicable requirement of the Internal
Revenue Code of 1986, as amended (the "Internal Revenue Code"), and the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") and desires for the
Trustee to serve as successor Trustee thereof; and
WHEREAS, the Plan is intended to qualify as a stock bonus plan under
Section 401(a) of the Internal Revenue Code and a leveraged employee stock
ownership plan under Section 4975(e)(7) of the Internal Revenue Code and to meet
the requirements of Section 4975(d)(3) of the Internal Revenue
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Code; and the Trust is intended to be exempt from federal income taxation under
Section 501(a) and the Internal Revenue Code; and
WHEREAS, the authority to manage and control the operation and
administration of the Plan is vested in the Company's Pension Committee, as
named fiduciary as provided in the Plan, which named fiduciary shall have such
authorities and shall be subject to such duties with respect to the Trust as are
specified in this Agreement; and
WHEREAS, cash, property and/or Stock (as hereinafter defined) will from
time to time be contributed to or purchased by the Trustee, which assets, as and
when received by the Trustee, will constitute a trust fund to be held for the
exclusive benefit of the participating employees under the Plan or their
beneficiaries and to defray reasonable expenses of administering the Plan; and
WHEREAS, the Company desires the Trustee to hold and administer such
trust fund and the Trustee is willing to hold and administer such trust fund
pursuant to the terms of this Agreement:
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, and intending to be legally bound hereby, the
Company and the Trustee do hereby covenant and agree as follows:
ARTICLE I
DEFINITIONS
Definitions. The following terms as used in this Agreement have the
meaning indicated unless the context requires otherwise:
1.1 "Board" means the Board of Directors of the Company.
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1.2 "Committee" means the Pension Committee designated in accordance
with the terms of the Plan.
1.3 "Company" means ▇▇▇▇▇▇▇ Company or any successor thereto.
1.4 "ERISA" means the Employee Retirement Income Security Act of 1974,
as it has been and may be amended from time to time.
1.5 "Fund" means the contributions of cash or property reasonably
acceptable to the Trustee, including, but not limited to, Stock deposited with
or purchased by the Trustee and held under this Trust by the Trustee, any
property into which the same or any part thereof may from time to time be
converted, and any appreciation therein or income thereon less any depreciation
therein, any losses thereon and any distributions or payments therefrom.
1.6 "Internal Revenue Code" means the Internal Revenue Code of 1986, as
it has been and may be amended from time to time.
1.7 "Loan" means any (i) loan to the Trust or any purchase money Note
issued by the Trust meeting the requirements of Treasury Regulation Section
54.4975-7(b) (1) (iii).
1.8 "Participant" means an employee of the Company or any affiliated
company who has an account balance under the Plan.
1.9 "Prohibited Transaction" means a prohibited transaction under
Sections 406 of ERISA and/or Section 4975(c)(1) of the Internal Revenue Code
which is not exempt under Section 408. of ERISA or Sections 4975(c)(2) or
4975(d) of the Internal Revenue Code, as the case may be.
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1.10 "Stock" means shares of stock, common or preferred, issued by the
Company (or a corporation which is a member of the same controlled group) which
meet the requirements of Section 409(l) of the Internal Revenue Code.
ARTICLE II
ESTABLISHMENT OF THE TRUST
2.1 The Company hereby appoints the Trustee as a successor Trustee of a
trust for the purpose of holding and administering the Fund in accordance with
this Agreement. The assets delivered to the Trustee are identified on Schedule A
attached to this Agreement.
2.2 Notwithstanding anything to the contrary in this Agreement, or in
any amendment thereto, except as otherwise provided under ERISA, the Company,
the Committee and the Trustee shall discharge their respective duties with
respect to the Fund for, and the Fund shall be used solely for and not diverted
from, the exclusive purposes of providing benefits for Participants and their
beneficiaries and defraying reasonable expenses of administering the Plan.
Notwithstanding the preceding sentence, however, contributions may be returned
by the Trustee to the Company at the direction of the Committee if the Committee
certifies in writing to the Trustee that one or more of the following
circumstances exist:
2.2.1 if a contribution is made by the Company by reason of a mistake of fact,
the contribution or the then current value thereof, if less, may be returned to
the Company without interest within one year after it was paid to the Trustee;
2.2.2 if a contribution is conditioned upon its deductibility under Section 404
of the Internal Revenue Code, the contribution or the then current value
thereof, if less, to the extent the deduction is disallowed by the Internal
Revenue Service, may be returned to the Company without interest within one year
after the disallowance; and
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2.2.3 if a contribution is conditioned upon initial qualification of the Plan
under Sections 401, 409 and 4975(e)(7) of the Internal Revenue Code, the
contribution or the then current value thereof, if less, may be returned to the
Company without interest within one year after such qualification has been
denied.
2.3 The Trustee shall receive any contributions paid to it in cash, in
Stock or in other property acceptable to it. All contributions so received,
together with the income therefrom and any other increment thereon, shall be
held, managed and administered by the Trustee pursuant to the terms of this
Agreement without distinction between principal and income and without liability
for the payment of interest thereon. The Trustee shall not be responsible for
the collection of any contributions to the Plan, or for the determination of the
amount or frequency of any contribution required by the Plan or the provisions
of the Internal Revenue Code or ERISA, which responsibilities shall be borne
solely by the Committee.
ARTICLE III
POWERS OF TRUSTEE
3.1 The Trustee shall maintain books of account and records with
respect to the Fund. The Fund shall be held by the Trustee in trust and dealt
with in accordance with the provisions of this Agreement. The Trustee shall take
all action necessary to implement any written directions received from the
Committee and shall conform to procedures established by the Committee for
disbursement of funds in accordance with the terms of the Plan.
3.2 It shall be the duty of the Trustee (a) to hold, invest and
reinvest the Fund in accordance with the provisions of this Agreement and the
Plan, and (b) to pay moneys therefrom in accordance with the written directions
of the Committee.
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3.3 Subject to Paragraph 3.9, at the direction of the Committee, the
Trustee shall invest the assets of the Fund primarily in Stock. To the extent
that Company contributions are made in Stock, the Trustee shall retain such
Stock unless otherwise directed by the Committee. To the extent Company
contributions are made in cash and are not used to pay principal or interest on
a Loan pursuant to Article X or to pay expenses of the Fund, the Trustee shall,
at the direction of the Committee, acquire Stock either from other shareholders
or directly from the Company. If at the time Stock is to be purchased, the
Company has outstanding more than one class of Stock, the Committee shall direct
the Trustee as to which class of Stock shall be purchased. The Trustee may rely
in good faith without liability upon the valuation of Stock as determined by the
Committee. The Trustee may also, at the direction of the Committee, invest the
Fund in temporary investments other than Stock, may hold such portion of the
Fund in such investments as may be required under the investment diversification
provision of the Plan, and hold such portion of the Fund uninvested as the
Committee deems advisable for making distributions under the Plan, may invest
assets of the Fund in short-term investments bearing a reasonable rate of
interest, including without limitation, deposits in, or short-term instruments
of, the Trustee, or in one or more short-term collective investment funds
administered by the Trustee as trustee thereof for the collective investment of
assets of employee pension or profit-sharing trusts, as long as each such
collective investment fund constitutes a qualified trust under the applicable
provisions of the Internal Revenue Code (and while any portion of the Fund is so
invested, such collective investment funds shall constitute part of the Plan to
the extent of such investment, and the instrument creating such funds shall
constitute part of this Agreement).
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3.4 The Trustee shall have no duty hereunder to determine or inquire
into whether any directions received from the Committee in accordance with the
terms of this Agreement represent proper and lawful decisions or result in
Prohibited Transactions. The Trustee shall have no duty to review any investment
to be acquired, held or disposed of pursuant to such instructions from the
Committee. If the Trustee does not receive written directions with respect to
any part of the Fund subject to the Committee's direction (including, without
limitation, income, sales proceeds or contributions), the Trustee shall, pending
receipt of such directions, hold and invest such amount in short-term securities
as provided in Paragraph 3.3 hereof.
3.5 In addition to, and not in limitation of, the powers now, or which
may later become, vested in it, the Trustee shall have the following powers;
provided, however, that the Trustee's exercise of such powers shall be
consistent with and subject to all other provisions of this Agreement, and
provided further that subject to the provisions of Paragraph 3.6 and 3.7 the
powers set forth in Paragraphs 3.5.1, 3.5.2, 3.5.3, 3.5.4 and 3.5.10 shall be
exercised by the Trustee only to the extent and in the manner directed by the
Committee in accordance with the terms of this Agreement, except as otherwise
required by ERISA:
3.5.1 Subject to the provisions of Paragraph 3.7, to sell, exchange, convey,
transfer, dispose of, grant options with respect to and otherwise deal with any
property at any time held by it,
3.5.2 Subject to the provisions of Paragraph 3.6, to exercise voting rights
either in person or by proxy, with respect to any securities or other property,
and generally to exercise with respect to the Fund all rights, powers and
privileges as may be lawfully exercised by any person owning similar property in
his own right;
3.5.3 Subject to the provisions of Paragraph 3.6 and 3.7, to exercise any
options, conversion rights, put rights or rights to subscribe for additional
stocks, bonds or other securities appurtenant to any securities
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or other property held by it, and to make any necessary payments in connection
with such exercise; and to join in, dissent from, and oppose the reorganization,
consolidation, recapitalization, liquidation, merger or sale of corporate
property with respect to any corporations or property in which it may be
interested as Trustee;
3.5.4 To compromise, compound, and settle any debt or obligation owing to or
from it as Trustee; and to reduce or increase the rate of interest on, extend or
otherwise modify, foreclose upon default, or otherwise enforce any such
obligation;
3.5.5 To ▇▇▇ or defend suits or legal proceedings to enforce or protect any
interest of the Trust; and to represent the Trust in all suits or legal
proceedings in any court or before any other administrative agency, body or
tribunal; provided that the Trustee is indemnified to the Trustee's satisfaction
against liability and expenses;
3.5.6 To hold any property at any place, except that it shall not maintain the
indicia of ownership of any assets of the Fund outside the jurisdiction of the
district courts of the United States except as permitted by regulations issued
by the Secretary of Labor of the United States under ERISA, Section 404(b);
3.5.7 To make, execute, acknowledge and deliver assignments, agreements and
other instruments;
3.5.8 To register any securities held by it hereunder in its own name or in the
name of a nominee with or without the addition of words indicating that such
securities are held in a fiduciary capacity, to permit securities or other
property to be held by or in the name of others, to hold any securities in
bearer form and to deposit any securities or other property in a depository,
clearing corporation or similar corporation, either domestic or foreign;
provided, however, that the records of the Trustee shall at all times show that
any such property held or registered in the name of another is part of the Fund;
3.5.9 To employ legal counsel, brokers and other advisors, agents or employees
to perform services for the Fund or to advise it with respect to its duties and
obligations under this Agreement and in connection with the Trust, and to pay
them from the Fund, to the extent not paid directly by the Company, such
compensation as it deems appropriate;
3.5.10 In accordance with the applicable provisions of the Plan and subject to
Paragraph 3.9, to borrow money from any lender in such amounts upon such terms
and conditions as shall be deemed advisable or proper to carry out the purposes
of the Trust, and for any sum so borrowed, to issue its promissory note as
Trustee, to pledge any securities or other property of the Fund for the
repayment of such loan and to repay from time to time the principal and interest
on, and to take any other action with respect to, such loan, all as directed by
the Committee; provided that if such loan is from, or guaranteed by, a "party in
interest" within the meaning of Section 3(14) of ERISA, the requirements of
Article X shall be satisfied;
3.5.11 In accordance with the applicable provisions of the Plan and subject to
Paragraph 3.9, to issue a promissory note or notes in payment for the
acquisition of Stock and with respect to any such note or
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notes to pledge any Stock acquired therewith as collateral for the note or
notes, and to pay from time to time the principal and interest on, and to take
any other appropriate and necessary action with respect to such note; provided
that if such note is payable to, or guaranteed by, a "party in interest" within
the meaning of Section 3(14) of ERISA, the requirements of Article X shall be
satisfied; and
3.5.12 To open and make use of banking accounts including checking accounts,
which accounts, if bearing a reasonable rate of interest or if checking
accounts, may be with the Trustee.
3.5.13 To perform all acts which the Trustee shall deem necessary or appropriate
and exercise any and all powers and authority of the Trustee under this
Agreement.
3.6 Each Participant (or beneficiary of a deceased Participant) to
whose account shares of voting Stock have been allocated shall, as a named
fiduciary within the meaning of Section 403(a)(1) of ERISA and in accordance
with the procedures hereinafter set forth, direct the Trustee with respect to
the votes of the shares of such Stock allocated to his or her account, and the
Trustee shall follow the directions of those Participants (and beneficiaries)
who provide timely instructions to the Trustee. Except as otherwise required by
ERISA, the Trustee shall have the authority to vote that portion of the shares
of voting Stock that have not been allocated to any Participant's (or
beneficiary's) account or for which no instructions were timely received by the
Trustee, whether or not allocated to the account of any Participant (or
beneficiary). Such directions shall be provided directly to the Trustee and
shall be held in confidence and not be divulged or released to any other person
including an officer or employee of the Company or a member of the Committee.
Within a reasonable time prior to each annual or special meeting of holders of
Stock, the Committee shall furnish to all Participants (and beneficiaries)
entitled to direct the Trustee as to the voting of shares of Stock copies of any
proxy solicitation material provided to holders of voting Stock generally
together with appropriate instruction forms or cards and information concerning
the method of providing such instructions to the Trustee.
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3.7 The provisions of this Paragraph 3.7 shall apply in the event a
tender or exchange offer including, but not limited to, a tender offer or
exchange offer within the meaning of the Securities Exchange Act of 1934, as
from time to time amended and in effect, (hereinafter, a "tender offer"), for
Stock is commenced by a person or persons. In the event a tender offer for Stock
is commenced, the Committee, promptly after receiving notice of the commencement
of any such tender offer, shall transfer certain of the Committee's record
keeping functions under the Plan to an independent record keeper (which if the
Trustee consents in writing, may be the Trustee). The functions so transferred
shall be those necessary to preserve the confidentiality of any directions given
by the Participants (and beneficiaries) in connection with the tender offer.
Within a reasonable time after a tender offer is commenced, the Committee shall
furnish to all Participants (and beneficiaries) entitled, as hereinafter set
forth, to direct the Trustee with respect to the sale, exchange or transfer of
any Stock, copies of all offering material provided to holders of Stock
generally, together with appropriate instruction forms or cards and information
concerning the method of providing such instructions to the Trustee. Except as
otherwise required by ERISA, the Trustee shall have no discretion or authority
to sell, exchange or transfer of any such shares pursuant to such tender offer
except to the extent, and only to the extent, that the Trustee is timely
directed to do so in writing as follows:
(a) Each Participant (or beneficiary) to whose account
shares of Stock have been allocated, shall, as a named
fiduciary within the meaning of Section 403(a)(1) of ERISA,
direct the Trustee with respect to the sale, exchange or
transfer of the shares of Stock allocated to his or her
account, and the Trustee shall follow the directions of those
Participants (and beneficiaries) who provide timely
instructions to the Trustee.
(b) The Trustee shall exercise its own discretion with
respect to the sale, exchange or transfer of a portion of the
shares of Stock that have not been allocated to any
Participant's (or beneficiary's) account or for which no
instructions were timely received
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by the Trustee, whether or not allocated to the account of any
Participant (or beneficiary).
All such instructions from Participants (and beneficiaries) shall be
provided directly to the independent record keeper which, if different from the
Trustee, shall then instruct the Trustee as to the amount of shares to be
tendered in accordance with the above directions.
Following any tender offer that has resulted in the sale or exchange of
any shares of Stock held in the Fund, the record keeper shall continue to
maintain on a confidential basis the accounts of Participants (and
beneficiaries) to whose accounts shares of Stock were allocated at any time
during such offer, until complete distribution of such accounts or such earlier
time as the record keeper determines that the transfer of the record keeping
functions back to the Committee will not violate the confidentiality of the
directions given by the Participants (and beneficiaries). In the event that
there is no sale or exchange of any shares of Stock held in the Fund pursuant to
the tender offer, the record keeper shall transfer back to the Committee and the
record keeping functions; provided, however, the record keeper shall keep
confidential any instructions which it may receive from Participants (and
beneficiaries) relating to the tender offer.
For purposes of allocating the proceeds of any sale or exchange
pursuant to a tender offer, the Committee or the independent record keeper, as
the case may be, shall determine the portion, expressed as a percentage, of
shares tendered by the Trustee that were actually sold or exchanged (the
"applicable percentage"). The Committee or the independent record keeper, as the
case may be, shall then treat as having been sold or exchanged from each of the
individual accounts of Participants (and beneficiaries) that number of shares
(if any) which is obtained by multiplying (i) the applicable percentage times
(ii) the
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total number of shares in such account that were directed to be
tendered or exchanged (or, in the case of an account for which timely
instructions were not received, the total number of shares in such account
multiplied by a fraction, the numerator of which is the total number of shares
of Stock tendered by the Trustee and the denominator of which is the total
number of shares of Stock held by the Trustee immediately prior to the tender).
Any proceeds remaining after application of the preceding sentences shall be
treated as proceeds from the sale or exchange of unallocated shares. The
adjustments to individual accounts pursuant to the provisions of the Plan shall
be made by the Committee or the independent record keeper, as the case may be,
on information supplied by the Company, the Committee or the record keeper.
3.8 If the Committee directs the Trustee to dispose of any investment
or security or any part thereof under circumstances which in the opinion of the
counsel for the Trustee require registration under the Securities Act of 1933 or
qualification under state "Blue Sky" laws, then the Company, at its own expense,
shall take or cause to be taken all such action necessary or appropriate to
effect such registration and qualification. The Trustee shall not be required to
dispose of such investment until such registration and qualification are
complete and effective, and shall not be liable for any loss or depreciation of
the Fund resulting from any delay attributable thereto. The Company shall
indemnify and hold the Trustee and its officers and directors harmless with
respect to any liability, reasonable legal counsel fees, and other costs and
expenses incurred as a result of such registration or qualification or as a
result of any information in connection therewith furnished by the Company or
any failure by the Company to furnish any information.
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3.9 Notwithstanding any other provisions of this Agreement or the Plan,
any purchase of Stock using a Loan shall be effected by the Trustee without
direction from the Committee pursuant to the Trustee's determination, in the
exercise of its reasonable judgment after consultation with such advisors as it
reasonably deems necessary, that such transaction is in the best interests of
the Participants and beneficiaries and that the purchase transaction and the
terms and conditions of such Loan are in compliance with all applicable
provisions of the Internal Revenue Code and ERISA.
3.10 In addition to, and not in limitation of, the powers vested and to
be vested in it by law or enumerated in this Article III, the Trustee shall have
the power to take any action with respect to the Fund as is appropriate and
helpful in carrying out the purposes of this Agreement, subject to any
directions of the Committee or the Participants (or beneficiaries) as provided
herein.
ARTICLE IV
ADMINISTRATION
4.1 The Committee shall represent the Company in dealing with the
Trustee under this Agreement. Until it receives written notice that a person is
no longer a member of the Committee, the Trustee shall be fully protected in
assuming that the person is still a member of the Committee. The Company shall
cause to be delivered to the Trustee a specimen signature of each member as well
as that of any designee of the Committee appointed pursuant to Paragraph 4.2.
The members of the Committee shall be "named fiduciaries" within the meaning of
ERISA, Section 402(a), with respect to the Plan.
4.2 The Trustee may rely (and shall be fully protected in relying) on
any written communication signed by a majority of the members of the Committee
as being authorized by, and
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reflecting the action of, the Committee. If the Trustee is advised in writing by
a majority of the members of the Committee that directives to the Trustee will
be signed by a person or persons designated by the Committee, the Trustee may
rely on communications signed by the person or persons so named as a directive
reflecting the action of the Committee.
4.3 The Trustee shall have only those duties specified in this
Agreement or specified in the Plan and expressly incorporated herein by
reference. In the event of any conflict between the provisions of the Plan and
this Agreement, the provisions of this Agreement shall control. The Trustee
shall have no responsibility to administer or interpret the Plan, to enforce
payment of any contributions to the Fund or to see that the Fund is adequate to
meet the liabilities of the Plan.
4.4 The Company or anyone acting on its behalf may at any time employ
the Trustee in its corporate capacity as agent to perform any act or to keep any
records in connection with the administration of the Plan. Any such agency
relationship shall be established by a separate written agreement between the
Company and the Trustee and the existence of such arrangement shall not affect
its responsibility or liability as Trustee under this Agreement.
4.5 Notwithstanding any provision of the Plan or this Agreement, the
Trustee shall not be obligated to follow the direction of a named fiduciary
unless such direction is in accordance with the terms of the Plan or this
Agreement and is proper and not contrary to ERISA.
ARTICLE V
PAYMENTS OF BENEFITS AND EXPENSES
5.1 Except as otherwise provided in Paragraph 5.3, the Trustee shall
pay benefits and administrative expenses under the Plan only when it receives
(and in accordance with) written
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instructions from the Committee, indicating the amount of the payment and the
name and address of the recipient. The Trustee shall have no duty to inquire
into whether any payment the Committee instructs it to make is consistent with
the terms of the Plan or applicable law or otherwise proper. Any payment made by
the Trustee in accordance with such instructions shall be a complete discharge
and acquittance to the Trustee. If the Committee advises the Trustee that
benefits have become payable respecting a Participant's interest in the Fund,
but does not instruct the Trustee as to the manner of payment, the Trustee shall
hold the Participant's interest in the Trust until it receives written
instructions from the Committee as to the manner of payment. The Trustee shall
not pay benefits from the Fund without such instructions, even though it may be
informed from other sources, including, without limitation, a Participant (or
beneficiary), that benefits are payable under the Plan. The Trustee shall have
no responsibility to determine when, to whom, or in what amounts benefits and
expenses are payable under the Plan.
5.2 The Trustee may pay any benefit or expense under the Plan by
mailing certificates representing shares of Stock and/or its check, as directed
by the Committee, for the amount thereof to the person designated by the
Committee as entitled to receive such payment to such address as may have been
furnished to the Trustee by the Committee. If no such address has been so
furnished, benefits or expenses may be mailed by the Trustee to such person in
care of the Committee or the Company.
5.3 The Trustee shall receive as compensation for its services as
Trustee such amounts as may, from time to time, be agreed upon in writing
between the Company and the Trustee. Such compensation and, in accordance with
the applicable provisions of ERISA and the Internal Revenue Code, all reasonable
and proper expenses incurred by the Trustee in the administration of the Trust,
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including reasonable legal counsel fees, shall be withdrawn by the Trustee out
of the Fund, unless paid by the Company.
5.4 The Company intends that the Plan shall at all times qualify under
Internal Revenue Code Sections 401(a), 409 and 4975(e)(7) and that the Trust
hereby established shall at all times be tax exempt under Section 501(a) of the
Internal Revenue Code, or successor provisions. However, any taxes that may be
levied upon or in respect of the Fund shall be paid from the Fund. The Trustee
shall promptly notify the Committee of any proposed taxes (other than stock
transfer taxes) of which it receives notice and may assume that any such taxes
are lawfully levied or assessed, unless the Committee advises it in writing to
the contrary within fifteen (15) days after receiving the above notice from the
Trustee. In such case, the Trustee, if requested by the Committee in writing,
shall contest the validity of such taxes in any manner deemed appropriate by the
Committee; the Company may itself contest the validity of any such taxes, in
which case the Committee shall so notify the Trustee and the Trustee shall have
no responsibility or liability respecting such contest. If any party to this
Agreement contests any such proposed levy, the other party shall provide such
information and cooperation as the party conducting the contest shall reasonably
request.
ARTICLE VI
LIABILITY AND INDEMNIFICATION OF THE TRUSTEE
6.1 The Trustee shall not be responsible for computing or collecting
contributions due under the Plan.
6.2 The Trustee in its corporate capacity shall not be liable for
claims of any persons arising under the Plan; such claims shall be limited to
the Fund. The Trustee shall not be liable to make
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distributions or payments of any kind unless sufficient funds are available
therefor in the Fund. The Trustee shall be responsible only for such money and
other property as are received by it as Trustee under this Agreement.
6.3 The Trustee may consult with legal counsel with respect to the
meaning and construction of this Agreement or its powers, obligations and
conduct hereunder, and the opinion of such counsel will, to the extent permitted
by law, be full and complete protection in respect of any action taken or
omitted by the Trustee hereunder in good faith and in accordance with the
opinion of such counsel.
6.4 The Trustee shall be under no liability for any loss of any kind
which may result (i) by reason of any action taken by it in accordance with any
direction of the Company, the Committee, or any Participant (or beneficiary of a
deceased Participant) acting as a named fiduciary pursuant to Paragraph 3.6 or
Paragraph 3.7 (hereinafter collectively referred to as the "directing
fiduciaries"), (ii) by reason of its failure to exercise any power or authority
or to take any action hereunder because of the failure of any such directing
fiduciary to give directions to the Trustee, as provided for in this Agreement,
or (iii) by reason of any act or omission of any of the directing fiduciaries
with respect to its duties under this Plan and Trust, or (iv) by reason of any
other act or omission of the Trustee except such as are due to its own
negligence, willful misconduct or failure to act in good faith.
6.5 The Trustee shall be fully protected in acting upon any instrument,
certificate, or paper delivered by the Company, the Committee, any Participant
or beneficiary (acting as a named fiduciary) and believed by the Trustee to be
genuine and to be signed or presented by the proper person or persons, and the
Trustee shall be under no duty to make any investigation or inquiry as to any
statement contained
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in any such writing, but may accept the same as conclusive evidence of the truth
and accuracy of the statements therein contained.
6.6 The Company agrees, to the fullest extent permitted by law, to
indemnify and hold harmless the Trustee from and against any and all losses,
claims, damages, liabilities or expenses (including, without limitation, any and
all expenses reasonably incurred in investigating, preparing or defending
against any litigation or proceeding, whether civil, criminal, administrative,
or investigative, commenced or threatened), incurred by or imposed on the
Trustee and arising either with respect to the investment in, or any other
action taken with respect to, Stock held by the Fund, or with respect to any
matter as to which the Trustee is not liable pursuant to Paragraph 6.4 of this
Agreement.
6.7 All notices, requests, demands and other communications hereunder
or with respect hereto shall be in writing and shall be deemed to have been
fully given if telegraphed, telecopied or telefaxed, mailed by registered or
certified mail, or personally delivered (or delivered by courier) as follows:
If to the Company, to:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Vice President - Finance, Treasurer
▇▇▇▇▇▇▇ Company
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
If to the Trustee, to:
State Street Bank and Trust Company
Retirement Investment Services Division
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ESOP Investment Services Officer
21
or to such other address or addresses as any party hereto may furnish to the
other party in writing.
6.8 Whenever the Trustee shall deem it desirable for a matter to be
proved or established before taking, permitting or omitting any act, the matter
(unless other evidence in respect thereof is specifically prescribed in this
Agreement) may be deemed to be conclusively established by a certification
signed by a majority of the members of the Committee and delivered to the
Trustee, and the Trustee shall be fully protected in relying on such an
instrument.
6.9 If a dispute arises as to the payment of any funds or delivery of
any assets by the Trustee, the Trustee may withhold such payment or delivery
until the dispute is determined by a court of competent jurisdiction or finally
settled in writing by the parties concerned.
22
ARTICLE VII
ACCOUNTING OF THE TRUSTEE
7.1 The Trustee shall keep accurate and detailed accounts of all its
transactions (including receipts and disbursements) under this Agreement. These
records shall be open to inspection and audit during regular business hours of
the Trustee by the Committee or any person or persons designated by the
Committee or the Company in a written instrument filed with the Trustee. If
mutually agreed upon in a separate writing by the Committee and the Trustee, the
Trustee shall establish and maintain accounts for Participants which shall show
their respective interests, determined in accordance with the terms of the Plan,
in the Fund; provided, however, that to the extent that such accounts are kept
by the Trustee on the basis of information furnished or caused to be furnished
to it by the Committee, the Trustee shall have no responsibility for the
accuracy of any information so furnished. All such accounts and records shall be
preserved (in original form, or on microfilm, magnetic tape or any other similar
process) for such period as the Trustee may determine, but the Trustee may
destroy such accounts and records only after first notifying the Committee and
the Company in writing at least ninety (90) days in advance of its intention to
do so and transferring to the Committee or the Company any such accounts and
records requested.
7.2 Within sixty (60) days after the close of each fiscal year of the
Plan, the Trustee's removal or resignation as Trustee hereunder, or the
termination of the Plan or this Agreement, the Trustee shall file with the
Committee an account setting forth all its transactions (including all receipts
and disbursements) under this Agreement during such year, or during the period
from the close of the last preceding fiscal year of the Plan to the effective
date of its removal or resignation or the termination of the Plan or this
Agreement, and showing all property (including its costs and fair market value)
held by it
23
hereunder at the end of such accounting period; provided, however, that in the
event shares of Stock are then held in the Trust and a final valuation report
with respect to such Stock for any such accounting period is not received by the
Trustee within thirty (30) days of the date the Trustee is required to render an
accounting under the foregoing provision, then the Trustee shall not be required
to render such account until thirty (30) days from the date such valuation
report is received by the Trustee. The Committee and the Trustee may agree in
writing that similar accounts will be prepared by the Trustee and filed with the
Committee at more frequent intervals. No person or persons (including, without
limitation, the Company and the Committee) shall be entitled to any further or
different accounting by the Trustee, except as may be required by law.
7.3 Ninety (90) days after the filing of any account with the Committee
under Paragraph 7.2, the Trustee shall be forever released and discharged from
any liability or accountability to the Company and the Committee with respect to
the transactions shown or reflected on the account, except with respect to any
acts or transactions as to which the Committee, within such ninety (90) day
period, files written objections with the Trustee. The written approval of the
Committee of any account filed by the Trustee, or the Committee's failure to
file written objections within ninety (90) days, shall be a settlement of such
account as against the Company and the Committee, and shall forever release and
discharge the Trustee from any liability or accountability to the Company and
the Committee with respect to the transaction shown or reflected on such
account. If a statement of objection is filed by the Committee and the Committee
is satisfied that its objections should be withdrawn or if the account is
adjusted to its satisfaction, the Committee shall indicate its approval of the
account in a written statement filed with the Trustee and the Trustee shall be
forever released and discharged from all liability and accountability to
24
the Company and the Committee in accordance with the immediately preceding
sentence. If an objection is not settled by the Committee and the Trustee, the
Trustee may commence a proceeding for a judicial settlement of the account in
any court of competent jurisdiction; the only parties that need be joined in
such a proceeding are the Trustee, the Committee, the Company and such other
parties whose participation is required by law.
ARTICLE VIII
REMOVAL AND RESIGNATION OF THE TRUSTEE
8.1 The Trustee may resign as Trustee under this Agreement at any time
by a written instrument delivered to the Company giving notice of such
resignation, which shall be effective sixty (60) days after receipt or at such
other time as is agreed by the Company and the Trustee. Upon the receipt of
instructions or directions from the Company or the Committee with which the
Trustee is unable or unwilling to comply, the Trustee may resign upon notice in
writing to the Company given within a reasonable time, under the circumstances
then prevailing, after the receipt of such instructions or directions; and,
notwithstanding any other provisions hereof, in that event, the Trustee shall
have no liability to the Company, or any person interested herein, for failure
to comply with such instructions or directions. The Trustee may be removed at
any time by the Company by an instrument in writing and delivered to the
Trustee, which shall be effective sixty (60) days after receipt or at such other
time as is agreed between the Company and the Trustee.
8.2 If a vacancy in the office of trustee of the Trust occurs, the
Company shall appoint a successor trustee and shall deliver to the Trustee
copies of (a) a written instrument executed by the
25
Company appointing such successor, and (b) a written instrument executed by the
successor in which it accepts such appointment. Such instruments shall indicate
their effective date.
8.3 If the Trustee resigns or is removed, it shall deliver all assets
of the Fund in its possession to a successor trustee as soon as is reasonably
practicable after the settlement of its account or at such earlier time as shall
be agreed on by the Company, the Trustee and the successor trustee.
ARTICLE IX
AMENDMENT AND TERMINATION
9.1 This Agreement may be amended at any time and from time to time by
the Company by a written instrument duly acknowledged and delivered to the
Trustee setting forth the terms of the amendment; provided that no amendment
affecting rights, duties or responsibilities of the Trustee may be made without
the Trustee's consent. The instrument of amendment shall state to the Trustee
that the amendment does not permit any part of the Fund to be used for or
diverted to purposes other than the exclusive benefit of Participants and their
beneficiaries or the payment of reasonable expenses of administering the Plan
and Trust, as specified in Paragraph 2.2 hereof. The instrument of amendment
shall specify its effective date and amendments may, with the Trustee's consent,
if applicable, be made effective retroactively.
9.2 If the Committee certifies to the Trustee that the Plan is or has
been terminated, the Trustee shall hold and/or dispose of the Fund in accordance
with the Committee's written instructions. The Committee shall certify in
writing to the Trustee that the disposition directed: (a) except as provided in
Paragraph 2.2, does not result in any part of the Fund being used for or
diverted to purposes other than the exclusive benefit of Participants and their
beneficiaries and the payment of reasonable expenses
26
(including the repayment of any outstanding loans) of administering the Plan and
Trust, (b) is in accordance with the applicable provisions of the Internal
Revenue Code, ERISA and any other applicable laws, and (c) does not result in a
Prohibited Transaction. If the Plan is terminated with respect to a group of
persons under the Plan, the portion of the Trust attributable to such group
shall be held and disposed of in accordance with the written instructions of the
Committee which shall be given in conformity with the provisions of the Plan,
the Internal Revenue Code and ERISA. The Trustee may, however, reserve such sum
of money as it deems advisable for payment of its fees and expenses in
connection with its administration of the Trust or the settlement of its account
or for payment of tax that may be assessed on or in respect of the Fund or the
income thereof. This Agreement shall terminate upon the termination of the Plan
as provided herein and the disposition of the Fund as provided herein.
ARTICLE X
LEVERAGED ACQUISITIONS OF STOCK
10.1 It is specifically contemplated that the Trust will operate
pursuant to a leveraged employee stock ownership plan and that the Trustee will
incur indebtedness in connection with the acquisition of Stock or will obtain
assets from its predecessor which are subject to such indebtedness. Any Loan
shall meet all of the requirements necessary to constitute an "exempt loan"
within the meaning of Treasury Regulation Section 54.4975-7(b)(1)(iii) and shall
be used primarily for the benefit of the Participants and their beneficiaries.
The proceeds of any Loan shall be used, within a reasonable time after the Loan
is obtained, only to purchase Stock or to repay such Loan or a prior Loan. Any
such Loan shall provide for no more than a reasonable rate of interest and must
be without recourse against the Plan and Trust. The number of years to maturity
under the Loan must be definitely ascertainable at all times. The Loan
27
may not be payable at the demand of any person, except in the case of a default.
The only assets of the Trust that may be given as collateral for a Loan are
shares of Stock acquired with the Loan and shares of Stock that were used as
collateral on prior Loans repaid with the proceeds of the current Loan. In the
event that Stock is used as collateral for a Loan, such Stock shall be released
from such encumbrance in accordance with the provisions of the Plan and
applicable Treasury Regulations. No person entitled to payment under a Loan
shall be entitled to payment from the Trust other than from shares of Stock
acquired with the Loan which are collateral for the Loan, Company contributions
made under the Plan for the purpose of satisfying the Loan obligation, earnings
attributable to such Stock and such Company contributions (other than
contributions of Stock), and such other assets, if any, as to which recourse may
be permitted under Section 4975 of the Internal Revenue Code. Payments of
principal and interest on any such Loan shall be made by the Trustee (as
directed by the Committee) only from (1) Company contributions (other than
contributions of Stock) made under the Plan for the purpose of satisfying such
Loan obligation, earnings on such contributions and earnings on shares of Stock
acquired with the proceeds of such Loan, including, but not limited to, cash
dividends received by the Trust with respect to the shares of Stock held by it,
whether or not allocated to the accounts of Participants (or beneficiaries), (2)
the proceeds of a subsequent Loan made to repay the prior Loan, and/or (3)
unless otherwise agreed to in the definitive documentation pertaining to such
Loan, the proceeds of the sale of any collateralized shares of Stock acquired
with the proceeds of such Loan; provided, however, that the Trustee shall in no
event be required to apply such proceeds of sale to repay principal and interest
on a Loan if, in the opinion of counsel to the Trustee, such action would
constitute a Prohibited Transaction or a breach of the Trustee's fiduciary
duties under ERISA. In the event of a default under a Loan, the value of Trust
28
assets transferred to the lender shall not exceed the amount of the default,
provided further that if the lender is a "party in interest" within the meaning
of ERISA Section 3(14) or a "disqualified person" within the meaning of Section
4975(e)(2) of the Internal Revenue Code, a transfer of Trust assets upon default
shall be made only if, and to the extent of, the Trust's failure to meet the
Loan's payment schedule.
ARTICLE XI
MISCELLANEOUS
11.1 This Agreement shall be binding upon, and the powers granted to
the Company and the Trustee, respectively, shall be exercisable by, the
respective successors and assigns of the Company and the Trustee. Any
corporation which shall, by merger, consolidation, purchase or otherwise,
succeed to substantially all the trust business of the Trustee shall, upon such
succession and without any appointment or other action by the Company, be and
become successor trustee hereunder, upon notification to the Company.
11.2 No right or claim in or to the Fund or any assets thereof shall be
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance or charge, and any attempt to so anticipate, alienate, sell,
transfer, assign, pledge, encumber or charge shall be void and shall not be
recognized by the Trustee, except to such extent as may be legally required
(e.g., as otherwise provided in the Plan with respect to qualified domestic
relations orders). No such right or claim shall be liable for or subject to the
debts, contracts, liabilities, engagements or torts of the person entitled
thereto.
11.3 This Agreement shall be administered, construed and enforced in
accordance with ERISA, and to the extent not governed by ERISA, in accordance
with the laws of the Commonwealth of Massachusetts.
29
11.4 One or more of the several subsidiary and affiliated companies
which are controlled by or under common control with the Company may, with the
approval of the Board, by resolution of its own board of directors adopt the
Trust if such subsidiary shall have adopted the Plan or any part thereof. Each
such subsidiary and affiliate which has adopted this Trust ("Related Company")
shall be deemed a party to this Agreement and all references herein to "Company"
shall be deemed to include such Related Company, except as the context may
otherwise require.
11.5 For all purposes of the Plan and Trust, all valuations of Stock
which is not readily tradable on an established securities market will be made
by an "independent appraiser" within the meaning of Section 401(a)(28)(C) of the
Internal Revenue Code.
11.6 Headings of Articles are inserted for convenience of reference.
They are not part of this Agreement and shall not be considered in construing
it.
11.7 This Agreement may be executed in any number of counterparts, each
of which shall be considered an original even though no others are produced. IN
WITNESS WHEREOF, the Company and the Trustee have caused this Agreement to be
executed by their duly authorized officers and their respective corporate seals
to be hereunto affixed as of the day and year first above written.
▇▇▇▇▇▇▇ COMPANY
By:_________________________________
Its:________________________________
Attest:
______________________________
▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ BANK AND TRUST COMPANY
By:_________________________________
Its: _______________________________
Attest:
______________________________