EXHIBIT 10(a)
FORM OF
INDIVIDUAL GRANTOR TRUST PARTICIPATION AGREEMENT
This INDIVIDUAL GRANTOR TRUST PARTICIPATION AGREEMENT ("Agreement") is
entered into effective this 1st day of November, 2003 by and between The
▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ Company ("Company") and ______________________________________
("Employee").
RECITALS
A. The Company has established and maintains The ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ Company
Deferred Compensation Savings and Pension Equalization Plan (the
"Nonqualified Plan") which is designed to provide supplemental
retirement benefits and other deferral opportunities to a select group
of key management employees;
B. The Employee is a member of a class of employees who have been excluded
from participation in the Nonqualified Plan; and
C. The Company shall pay to the Employee and the Employee shall direct the
Company to deposit (i) certain cash compensation payments on behalf of
the Employee and (ii) any distribution which may be made in the future
from the Nonqualified Plan, directly into an individual grantor trust
to be established and maintained by Employee, which compensation
amounts shall be in an amount equal to the amounts that would have been
contributed to the Nonqualified Plan.
NOW THEREFORE, in consideration of the mutual promises set forth herein
and other good and valuable consideration, the parties agree as follows:
1. Individual Grantor Trust. As a condition to the receipt of any
compensation payments contemplated herein, the Employee agrees to
establish and maintain an irrevocable individual grantor trust in the
form attached hereto as Exhibit A (the "Trust") for the purpose of
receiving and holding the cash deposits made pursuant to this Agreement
and any interest or other earnings on the outstanding balances in the
Trust. Employee hereby expressly appoints Company as his agent to act
as "Administrator" of the Trust for purposes of providing guidelines
and other information and direction to the trustee of the Trust;
selecting the initial trustee and removing and appointing successor
trustees; examining the books and records of the Trust; amending and
terminating the Trust; and such other purposes as are expressly
reserved to the Administrator in the Trust. In the event of a Change in
Control of Company (as such term is defined in the Trust), the Employee
may remove the Company as Administrator by delivering notice to the
Company at the address set forth herein and complying with any
additional requirements set forth in the Trust.
2. Waiver of Nonqualified Plan Participation. The Employee acknowledges
and agrees that, in consideration of the payments and other benefits of
entering into this Agreement, the Employee hereby forever waives any
future right which the Employee may have to participate in the
Nonqualified Plan and expressly irrevocably elects not to participate
in the Nonqualified Plan, even in the event the Employee ceases to be a
member of the group of employees excluded by amendment to the
Nonqualified Plan, and regardless of any enrollment or other
information which may be made available to or completed by the Employee
at any time in the future.
3. Supplemental Compensation Payments; Nonqualified Plan Distribution.
Commencing with the first pay period on or after November 21, 2003, the
Company shall make available to the Employee via regular bi-weekly
payroll, an amount equal to the amount the Employee would otherwise
have contributed to or been entitled to have contributed on his behalf
to the
Nonqualified Plan had he been permitted to continue participating under
the then existing terms of such Nonqualified Plan ("Supplemental
Compensation Payments"). The Employee hereby elects and directs the
Company to contribute the Supplemental Compensation Payments directly
to the Trust on the Employee's behalf. If the Employee receives a
future distribution of his account balance and/or accrued benefit in
the Nonqualified Plan, then the Employee agrees that such distribution
shall also be contributed to the Trust and that any distribution forms
completed in connection with the distribution from the Nonqualified
Plan shall provide that the distribution, net of all applicable
federal, state and local income, withholding and other taxes, shall be
paid to the Trust on the Employee's behalf. All amounts payable
pursuant to this Agreement shall be subject to applicable federal,
state and local income, withholding and other taxes at the rates set
forth in Exhibit C and shall be reduced therefore prior to transfer to
the Trust.
4. Additional Contributions. The Employee shall not contribute, nor shall
the Employee permit any third party, to contribute any additional funds
to the Trust (except for the crediting of interest and earnings on the
assets in the Trust).
5. Withdrawals from Trust. The Employee may withdraw Trust assets at any
time; provided however, except as provided below, in the event the
Employee elects to withdraw Trust assets, the Employee shall forfeit
all right to receive any further gross-up for tax liability (as
provided in Section 7 hereof) relating to all amounts in the Trust.
Following a withdrawal, no further contributions shall be made to the
Trust. Notwithstanding the foregoing, the Employee may elect to
withdraw, no later than the close of business of the tenth (10th) day
following the time an amount is contributed to the Trust, only the
amount which was contributed during such ten (10) day period without
forfeiting the right to receipt of gross-up pursuant to Section 7 and
future contributions. In the event the Trust is required, pursuant to a
final non-appealable court order issued pursuant to applicable state or
federal law, to distribute a portion of the amounts held in the trust
to a creditor or spouse, any amounts required to be distributed shall
be considered a withdrawal from the Trust and no further gross-up or
other rights set forth herein shall be available to the court ordered
recipient of such amounts; provided however, that the Employee shall
not be treated as having a withdrawal for purposes of the balance
remaining in the Trust and shall not forfeit any rights to receipt of
gross-up pursuant to Section 7, future contributions or other rights or
benefits hereunder with respect to such remaining balance.
6. Pledge of Trust Assets. Notwithstanding the provisions of Sections 5
and 10(e) hereof, the Employee shall be permitted to pledge all or a
portion of the amounts in the Trust as collateral for a loan solely in
connection with the exercise of stock options issued pursuant to The
▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ Company 1994 Stock Plan, The ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ Company
2003 Stock Plan or any successor or similar stock option plan
established by the Company.
7. Gross-Up for Tax Liability Associated with the Trust. As soon as
practicable following the end of each calendar year, the Employee shall
be entitled to receive an additional payment under this Agreement (a
"Gross-Up Payment") with respect to the net taxable interest and
earnings on the assets in the Trust which have been invested by the
Employee in those types of investment vehicles specified in Exhibit B
("Approved Investments"), which may be amended by the Company in its
sole discretion from time to time. In the event the Approved Investment
is Company common stock acquired by virtue of the exercise of stock
options granted by the Company to the Employee, the amount of the
Gross-Up Payment shall be determined only with reference to earnings
and appreciation on such common stock during the period of time such
common stock has been held by the Trust. Upon any such amendment, the
Company shall, as promptly as practicable, furnish the Employee a copy
of the amended Exhibit B. The Gross-Up Payment shall be determined in
accordance with the
2
assumptions in Exhibit C such that, after payment by the Employee of
all applicable taxes on the income and earnings on the assets in the
Trust invested in Approved Investments (excluding any interest or
penalties imposed with respect to such taxes), the Employee retains an
amount of the Gross-Up Payment approximating the tax liability incurred
by the Employee with respect to the income and earnings on the Approved
Investments and the tax on the Gross-Up Payment. All determinations of
the Gross-Up Payment shall be made in good faith by the Company in the
manner and using the assumptions set forth in this Agreement and shall
be the final, binding and non-appealable determination of the amount of
the Gross-Up Payment, except to the extent the Employee can demonstrate
gross error in the Company's determination. The Gross-Up Payment shall
be made directly to the Employee and shall not be contributed to the
Trust. All Gross-Up Payments shall be subject to applicable federal,
state and local income, withholding and other taxes. Employee and
Company acknowledge that it shall be Employee's responsibility to
insure proper amounts are paid to taxing authorities during the tax
year to comply with Section 6654 of the Internal Revenue Code of 1986,
as amended (the "Code") (estimated taxes) and similar present or future
federal, state or local requirements and avoid underpayment penalties.
Any such penalties shall be the responsibility of Employee.
8. Trust Fees. The Company shall pay, directly to the trustee of the
Trust, all trustee fees associated with the establishment and
maintenance of the Trust. The Employee shall pay all administrative
charges associated with the Trust, including but not limited to
brokerage fees and other charges associated with the investment
activities of the Trust.
9. Termination. This Agreement shall automatically terminate on the
earliest to occur of the following dates: (1) the Employee's death; (2)
the Employee's retirement; (3) the Employee's termination of employment
with the Company for any reason; or (4) the Employee's withdrawal of
any amounts from the Trust, except during the ten day period permitted
pursuant to Section 5. Notwithstanding the foregoing, during the
lifetime of the Employee, this Agreement may be terminated at any time
by the Company by providing thirty (30) days written notice to the
Employee. Any such termination shall operate on a prospective basis
only and shall not alter the application of the terms of this Agreement
with respect to the effect of the waivers, releases or other
commitments made hereunder. In the event this Agreement is terminated
as a consequence of the Employee's withdrawal of amounts from the Trust
other than during the ten day period permitted pursuant to Section 5,
the Employee shall receive a Gross-Up Payment, to the extent
applicable, as soon as practicable following the withdrawal, only with
respect to earnings through the date of termination of the Agreement.
In the event this Agreement is terminated as a consequence of the
Employee's death, retirement or termination of employment for any
reason, the Employee (or beneficiary(ies) shall receive a Gross-Up
Payment, to the extent applicable, as soon as practicable following
death, retirement or termination of employment for any reason, with
respect to earnings and unrealized appreciation through the date of
termination of the Agreement.
10. Miscellaneous.
a. Nothing in this Agreement shall be construed to confer upon
the Employee the right to continue in the employment of the
Company, or to require the Company to continue the employment
of the Employee.
b. Nothing in this Agreement shall be construed as altering the
Employee's responsibility to comply with all applicable
policies and procedures established by the Company governing
the employment relationship and conduct of business, including
but not limited to the obligation to comply with all
applicable polices and procedures regarding ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
and transactions in Company securities.
3
c. This Agreement shall be binding upon and inure to the benefit
of the Company, its successors and assigns and the Employee or
his Beneficiaries and the Employee's spouse and their heirs,
executors, other successors in interest, administrators and
legal representatives.
d. Company and the Employee specifically acknowledge that this
Agreement and the Individual Grantor Trust are not subject to
any provision of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA").
e. No benefit payable under this Agreement may be assigned,
transferred, encumbered or subjected to legal process for the
payment of any claim against Employee, his spouse, family
member or beneficiary.
f. The validity and interpretation of this Agreement shall be
governed by the laws of the State of Ohio.
g. The Employee's beneficiaries shall be determined in accordance
with the terms of the trust agreement pursuant to which the
Trust is maintained.
IN WITNESS WHEREOF, the parties have set their hand effective this 1st
day of November, 2003.
THE ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ COMPANY EMPLOYEE
By: __________________________ By: _________________________
Printed Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Printed Name: _______________
Title: Senior Vice President - Title: ______________________
Human Resources
4
EXHIBIT A
[EXECUTIVE NAME]
FORM OF INDIVIDUAL GRANTOR TRUST
This [EXECUTIVE NAME] INDIVIDUAL GRANTOR TRUST AGREEMENT ("Trust
Agreement") is made effective this 1st day of November, 2003 by and between
_________________________("Grantor") and Wachovia Bank, National Association
("Trustee").
RECITALS
(a) The ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ Company ("Company") has established and maintains
certain nonqualified deferred compensation and other plans, programs
and arrangements ("Arrangements");
(b) Company has amended certain of such Arrangements to exclude a class of
employees, of which Grantor is a member, from further participation in
the Arrangements and to provide for distribution of all amounts which
Grantor has accrued in the Arrangements through the date of such
amendment; and
(c) Company and Grantor have entered into an Individual Grantor Trust
Participation Agreement ("Participation Agreement") effective November
1, 2003, pursuant to which Grantor has elected, among other things, to
contribute certain amounts to be distributed from the Arrangements and
other future compensation payments to this Trust in consideration of
Company's promise to make certain additional compensation payments to
Grantor on the condition that such compensation payments be contributed
by Grantor directly to this Trust.
NOW, THEREFORE, the parties do hereby establish the Trust and agree
that the Trust shall be comprised, held and disposed of as follows:
SECTION 1. ESTABLISHMENT OF THE TRUST
(a) The Trust is intended to be a Grantor Trust within the meaning of
subpart E, part I, subchapter J, chapter 1, subtitle A of the Internal
Revenue Code of 1986, as amended, held for the benefit of [insert
executive name] and shall be construed accordingly.
(b) Grantor shall be considered the grantor for the purposes of the Trust.
(c) Pursuant to its appointment in the Participation Agreement, Company
shall be considered the Administrator for purposes of this Trust and
shall have the powers, rights and duties set forth herein. Company
shall designate, in a written certificate furnished to Trustee, those
individuals authorized by Company to give direction to Trustee on
behalf of Company as Administrator. Company shall have the right to
change such designations from time to time by written notice to
Trustee. In taking or omitting to take any action hereunder, Trustee
may rely on the latest certificate received without further inquiry or
verification; provided such action or omission is within the scope of
Administrator's rights hereunder. Notwithstanding the foregoing, in the
event of a Change in Control (as defined in Section 12), Grantor may
remove Company (or its successor) and any designees as Administrator by
delivering written notice of its intent to remove the Administrator to
both Company and Trustee.
A-1
Trustee may rely upon any notice of removal received from Grantor
without further inquiry or verification, unless Company (or its
successor) provides to Trustee within ten (10) days of Company's
receipt of Grantor's notice of removal, written notice certifying that
no Change in Control occurred. In the event Grantor removes Company as
Administrator, Grantor shall be deemed to be the Administrator.
(d) The Trust hereby established is irrevocable by the Grantor. Neither the
Company nor any person other than the Grantor (or the Grantor's
beneficiaries in the event of Grantor's death) and the Trustee (solely
when acting as such) shall have any right, title or interest in the
assets of the Trust Fund (as defined below).
(e) Grantor hereby deposits with or transfers to the Trustee in Trust one
dollar and zero cents ($1.00) which shall become the principal of the
Trust to be held, administered and disposed of by the Trustee as
provided in this Trust Agreement.
(f) Trustee accepts the duties and obligations as "trustee" hereunder and
agrees to accept funds delivered to it on behalf of Grantor and to hold
such funds and any proceeds from the investment of such funds in trust
in accordance with this Agreement.
SECTION 2. TRUST FUND
(a) The principal of the Trust, and any earnings thereon ("Trust Fund")
shall be held separate and apart from other funds of the Grantor. Any
assets held by the Trust will be subject to the claims of the general
creditors of Grantor under federal and state law.
(b) Except as contemplated in the Participation Agreement, Grantor shall
not make additional deposits of cash or other property to the Trust to
augment the principal to be held, administered and disposed of by the
Trustee. The Trustee is not obliged to determine whether funds
delivered to or distributions from the Trust are proper under the Trust
Agreement, or whether any tax is due or payable as a result of such
delivery or distribution. The Trustee shall be protected in making any
distribution from the Trust, including any amounts payable to a
creditor or spouse pursuant to a final non-appealable court order
entered pursuant to applicable state or federal law, pursuant to the
provisions of this Trust Agreement, and the Trustee shall not be liable
for any distribution made in good faith without written notice or
knowledge that the distribution is not proper under the terms of the
Agreement.
A-2
SECTION 3. INVESTMENT AUTHORITY
(a) Grantor shall have the power, in its sole discretion, to direct the
Trustee in investing and reinvesting the Trust Fund:
(1) To invest and reinvest in any readily marketable common and
preferred stocks (including stock or rights to acquire stock
or other obligations issued by the Company), bonds, notes,
debentures, certificates of deposit or demand or time deposits
(including any such deposits with the Trustee) and shares of
investment companies and mutual funds, without being limited
to the classes or property in which the Trustees are
authorized to invest by any law or any rule of court of any
state and without regard to the proportion any such property
may bear to the entire amount of the Trust Fund.
Notwithstanding the foregoing provisions of this Section
3(a)(1) or any other provisions of this Trust Agreement,
regardless of any resulting risk or lack of diversification,
Grantor may, prior to the termination of the Trust, direct the
investment or liquidation of such funds in one or more
external brokerage accounts established by the Trustee. The
Trustee shall not be liable for a loss that results from
following the investment directions provided by Grantor;
(2) To retain any property at any time received by the Trustee;
(3) To sell or exchange any property held by it at public or
private sale, for cash or on credit, to grant and exercise
options for the purchase or exchange thereof, to exercise all
conversion or subscription rights pertaining to any such
property and to enter into any covenant or agreement to
purchase any property in the future;
(4) To participate in any plan of reorganization, consolidation,
merger, combination, liquidation or other similar plan
relating to property held by it and to consent to or oppose
any such plan or any action thereunder or any contract, lease,
mortgage, purchase, sale or other action by any person;
(5) To deposit any property held by it with any protective,
reorganization or similar committee, to delegate discretionary
power thereto, and to pay part of the expenses and
compensation thereof any assessments levied with respect to
any such property to deposit;
(6) To extend the time of payment of any obligation held by it;
(7) To hold uninvested any moneys received by it, without
liability for interest thereon, but only in anticipation of
payments due for investments, reinvestments, expenses or
disbursements;
(8) To exercise all voting or other rights with respect to any
property held by it and to grant proxies, discretionary or
otherwise;
(9) To borrow money from others, to issue its promissory note or
notes therefor, and to secure the repayment thereof by
pledging any property held by it;
(10) To employ suitable contractors and counsel, who may be counsel
to the Trustee, and to pay their reasonable expenses and
compensation from the Trust Fund;
A-3
(11) To register investments in its own name or in the name of a
nominee; to authorize the Company to send deposits directly to
one or more external brokerage account(s) established by the
Trustee and to hold any investment in such brokerage
account(s); and to combine certificates representing
securities with certificates of the same issue held by it in
other fiduciary capacities or to deposit or to arrange for the
deposit of such securities with any depository, even though,
when so deposited, such securities may be held in the name of
the nominee of such depository with other securities deposited
therewith by other persons, or to deposit or to arrange for
the deposit of any securities issued or guaranteed by the
United States government, or any agency or instrumentality
thereof, including securities evidenced by book entries rather
than by certificates, with the United States Department of the
Treasury or a Federal Reserve Bank, even though, when so
deposited, such securities may not be held separate from
securities deposited therein by other persons; provided,
however, that no securities held in the Trust Fund shall be
deposited with the United States Department of the Treasury or
a Federal Reserve Bank or other depository in the same account
as any individual property of the Trustee, and provided,
further, that the books and records of the Trustee shall at
all times show that all such securities are part of the Trust
Fund;
(12) To settle, compromise or submit to arbitration any claims,
debts or damages due or owing to or from the Trust,
respectively, to commence or defend suits or legal proceedings
to protect any interest of the Trust, and to represent the
Trust in all suits or legal proceedings in any court or before
any other body or tribunal; provided, however, that the
Trustee shall not be required to take any such action unless
it shall have been indemnified by the Company to its
reasonable satisfaction against liability or expenses it might
incur therefrom;
(13) To furnish Grantor with such information regarding the Trust
or assets in the Trust in the Trustee's possession as Grantor
may need for tax or other purposes;
(14) To hold any other class of assets which may be contributed by
the Grantor and that is deemed reasonable by the Trustee,
unless expressly prohibited herein;
(15) To appoint a brokerage firm as custodian of part or all of the
Trust Fund, and each such brokerage firm shall have such
rights, powers, duties and discretions as are delegated to it
by the Trustee and as are consistent with the powers, duties
and discretions reserved to the Trustee under this Agreement;
and
(16) Generally, to do all acts, whether or not expressly
authorized, that the Trustee may deem necessary or desirable
for the protection of the Trust Fund.
(b) Notwithstanding the foregoing, Administrator shall have the authority
to establish and deliver to Trustee from time to time written
investment guidelines setting forth the parameters within which Trustee
shall exercise its authority with respect to the investment of the
Trust Fund, subject to the above restrictions, and Trustee shall have
no liability to Administrator, Company, Grantor or any other person
interested in the Trust Fund for any action or omission in reliance
upon such guidelines.
A-4
(c) Nothing in this Trust Agreement shall prevent Grantor from pledging all
or a portion of the Trust Fund as collateral or security.
SECTION 4. DISPOSITION OF INCOME
During the term of this Trust, all income received by the Trust, net of expenses
and taxes shall be accumulated and reinvested within the Trust.
SECTION 5. WITHDRAWALS FROM TRUST
Subject to any limitations which may be imposed upon Grantor by the
Participation Agreement, Grantor may withdraw funds from the Trust at any time.
SECTION 6. ACCOUNTING BY THE TRUSTEE
The Trustee shall keep accurate and detailed records of all investments,
receipts, disbursements, and all other transactions required to be made,
including such specific records as shall be agreed upon in writing between
Administrator and Trustee. The Trustee shall deliver to Grantor and
Administrator a written account of its administration of the Trust during such
year or during the period from the close of the last preceding year to the date
of such removal or resignation setting forth all investments, receipts,
disbursements and other transactions effected by it, including a description of
all securities and investments purchased and sold with the cost or net proceeds
of such purchases or sales (accrued interest paid or receivable being shown
separately), and showing all cash, securities and other property held in the
Trust at the end of such year or as of the date of such removal or resignation,
as the case may be. The Trustee shall furnish the Administrator with information
relating to the actual (and, if requested, estimated) income of the Trust Fund,
including the character of such income, as the Administrator may from time to
time request. In addition, Trustee shall make its books and records with respect
to the Trust available to Administrator for inspection and audit during
reasonable business hours upon reasonable advance written notice.
SECTION 7. RESPONSIBILITY OF THE TRUSTEE
(a) The Trustee shall act with the care, skill, prudence and diligence
under the circumstances then prevailing that a prudent person acting in
like capacity and familiar with such matters would use in the conduct
of an enterprise of a like character and with like aims, provided,
however, that the Trustee shall incur no liability to any person for
any action taken pursuant to a direction, request or approval given by
Grantor or Administrator which is contemplated by, and in conformity
with, the terms of the Arrangements or this Trust and is given in
writing by the Grantor or Administrator, as appropriate. The Trustee
shall have no duty to question or make inquiries as to any action or
direction given by Grantor, or the failure of Grantor to take such
action or give directions. In the event of a dispute between the
Grantor and a third party, the Administrator and a third party or the
Grantor and the Administrator, the Trustee may apply to a court of
competent jurisdiction to resolve the dispute.
(b) The Trustee shall have, without exclusion, all powers conferred on the
Trustee by applicable law, unless expressly provided otherwise herein.
(c) Notwithstanding any powers granted to the Trustee pursuant to this
Trust Agreement or pursuant to applicable law, the Trustee shall not
have any power that could give this Trust the objective of carrying on
a business and dividing the gains therefrom, within the meaning
A-5
of section 301.7701-2 of the Procedure and Administrative Regulations
promulgated pursuant to the Internal Revenue Code.
SECTION 8. COMPENSATION AND EXPENSES OF THE TRUSTEE
The Trustee's compensation shall be as agreed in writing from time to time by
the Administrator and the Trustee. Grantor shall pay all administrative expenses
associated with the Trust and transactions relating to the Trust Fund. Company
shall pay the Trustee's fees at all times prior to the termination of the
Participation Agreement and shall promptly reimburse the Trustee for any fees
and expenses of its agents. If not so paid, the fees and expenses shall be paid
from the Trust.
SECTION 9. RESIGNATION AND REMOVAL OF THE TRUSTEE
(a) Trustee may resign at any time by written notice to Administrator and
Grantor, which shall be effective sixty (60) days after receipt of such
notice by Administrator unless Administrator and the Trustee agree
otherwise. If Administrator fails to act within a reasonable period of
time following such resignation, Trustee shall apply to a court of
competent jurisdiction for appointment of a successor Trustee or for
instructions.
(b) Trustee may be removed by Administrator on sixty days (60) days notice
or upon shorter notice accepted by the Trustee.
(c) Upon resignation or removal of the Trustee and appointment of a
successor Trustee, all assets shall subsequently be transferred to the
successor Trustee. The transfer shall be completed within sixty (60)
days after receipt of notice of resignation, removal or transfer,
unless Administrator extends the time limit.
(d) If the Trustee resigns or is removed, a successor shall be appointed by
Administrator, in accordance with Section 10 hereof, by the effective
date of resignation or removal under paragraph(s) (a) or (b) of this
section. If no such appointment has been made, the Trustee may apply to
a court of competent jurisdiction for appointment of a successor or for
instructions. All expenses of the Trustee in connection with the
proceeding shall be allowed as administrative expenses of the Trust.
SECTION 10. APPOINTMENT OF SUCCESSOR
(a) If Trustee resigns or is removed in accordance with Section 9 hereof,
Administrator may appoint a qualified institution to replace the
Trustee upon resignation or removal. The successor Trustee shall have
all of the rights and powers of the former Trustee, including ownership
rights in the Trust. The former Trustee shall execute any instrument
necessary or reasonably requested by the Administrator or the successor
Trustee to evidence the transfer.
(b) The successor Trustee need not examine the records and acts of any
prior Trustee and may retain or dispose of existing Trust assets. The
successor Trustee shall not be responsible for and the Company shall
indemnify and defend the successor Trustee from any claim or liability
resulting from any action or inaction of any prior Trustee or from any
other past event, or any condition existing at the time it becomes
successor Trustee.
A-6
SECTION 11. AMENDMENT OR TERMINATION
(a) Administrator, on behalf of Grantor, may from time to time amend this
Trust Agreement in any respect, provided, however, that no such
amendment shall change the duties, responsibilities or compensation of
Trustee without its written consent or shall cause any amount held in
the Trust Fund to be payable to Company or to any person other than
Grantor, his beneficiaries or estate. Any such amendment to this Trust
Agreement shall be evidenced by a written instrument executed by the
Trustee and Administrator. Notwithstanding the foregoing, no such
amendment shall conflict with the terms of the Arrangements or shall
make the Trust revocable.
(b) The Trust shall terminate upon the death of the Grantor. In the event
of termination as a consequence of death, the Trustee shall deliver the
Trust Funds to the beneficiary(ies) designated by Grantor pursuant to
Section 13(d).
(c) Upon the date on which the Participation Agreement terminates, Company
shall relinquish all rights as Administrator of the Trust and Grantor
shall be deemed to be the Administrator. At such time as Grantor
becomes the Administrator, whether pursuant to this Section 11(c) or
Section 1(c), Grantor may terminate this Trust Agreement and the Trust
at any time upon advance written notice to the Trustee.
SECTION 12. CHANGE IN CONTROL
For purposes of this Trust, the following terms shall be defined as follows:
(a) A person (as such term is used in Sections 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934, as amended, hereinafter "Exchange
Act") shall be deemed the "BENEFICIAL OWNER" of and shall be deemed to
"beneficially own" any securities:
(1) which such person or any of such person's "Affiliates" or
"Associates" (as such terms are defined in Rule 12b-2, as in
effect on April 23, 1997, of the General Rules and under the
Exchange Act) is considered to be a "beneficial owner" under
Rule 13d-3 of the General Rules and Regulations under the
Exchange Act, as in effect on April 23, 1997;
(2) which such person or any of such person's Affiliates or
Associates, directly or indirectly, has or shares the right to
acquire, hold, vote (except pursuant to a revocable proxy as
described in the proviso to this Section 12(a)) or dispose of
such securities (whether any such right is exercisable
immediately or only after the passage of time) pursuant to any
agreement, arrangement or understanding (whether or not in
writing), or upon the exercise of conversion rights, exchange
rights, rights, warrants or options, or otherwise; provided,
however, that a person shall not be deemed to be the
Beneficial Owner of, or to beneficially own, securities
tendered pursuant to a tender or exchange offer made by or on
behalf of such person or any of such person's Affiliates or
Associates until such tendered securities are accepted for
purchase or exchange; or
(3) which are beneficially owned, directly or indirectly, by any
other person (or any Affiliate or Associate of such other
person) with which such person (or any of such person's
Affiliates or Associates) has any agreement, arrangement or
understanding (whether or not in writing), with respect to
acquiring, holding,
A-7
voting (except as described in the proviso to this Section
12(a)) or disposing of any securities of the Company;
provided, however, that a person shall not be deemed the Beneficial
Owner of, nor to beneficially own, any security if such person has the
right to vote such security pursuant to an agreement, arrangement or
understanding which (I) arises solely from a revocable proxy given to
such person in response to a public proxy or consent solicitation made
pursuant to, and in accordance with, the applicable rules and
regulations under the Exchange Act, and (II) is not also then
reportable on Schedule 13D (or any comparable or successor report)
under the Exchange Act; and provided, further, that nothing in this
Section 12(a) shall cause a person engaged in business as an
underwriter of securities to be the Beneficial Owner of, or to
beneficially own, any securities acquired through such person's
participation in good faith in a firm commitment underwriting until the
expiration of forty (40) days after the date of such acquisition or
such later date as the Board of Directors may determine in any specific
case.
(b) "CHANGE IN CONTROL" shall be deemed to have occurred if:
(1) Any person (as such term is used in Sections 13(d) and
14(d)(2) of the Exchange Act) who or that, together with all
Affiliates and Associates of such person, is the Beneficial
Owner of ten percent (10%) or more of the shares of Common
Stock of the Company then outstanding, except:
(i) the Company;
(ii) any of the Company's subsidiaries in which a majority
of the voting power of the equity securities or
equity interests of such subsidiary is owned,
directly or indirectly, by the Company;
(iii) any employee benefit or stock ownership plan of the
Company or any trustee or fiduciary with respect to
such a plan acting in such capacity; or
(iv) any such person who has reported or may, pursuant to
Rule 13d-1(b)(1) of the General Rules and Regulations
under the Exchange Act, report such ownership (but
only as long as such person is the Beneficial Owner
of less than fifteen percent (15%) of the shares of
Common Stock then outstanding) on Schedule 13G (or
any comparable or successor report) under the
Exchange Act
Notwithstanding the foregoing: (I) no person shall become the
Beneficial Owner of ten percent (10%) or more (fifteen percent
(15%) or more in the case of any person identified in clause
(iv) above) solely as the result of an acquisition of Common
Stock by the Company that, by reducing the number of shares
outstanding, increases the proportionate number of shares
beneficially owned by such person to ten percent (10%) or more
(fifteen percent (15%) or more in the case of any person
identified in clause (iv) above) of the shares of Common Stock
then outstanding; provided, however, that if a person becomes
the Beneficial Owner of ten percent (10%) or more (fifteen
percent (15%) or more in the case of any person identified in
clause (iv) above) of the shares of Common Stock solely by
reason of purchases of Common Stock by the Company and shall,
after such purchases by the Company, become the Beneficial
Owner of any additional shares of Common Stock which has the
effect of increasing such person's percentage ownership of the
then-outstanding shares of Common Stock by any means
whatsoever, then such person shall be deemed to have triggered
a Change in Control; and (II) if the Board of Directors
determines that a person
A-8
who would otherwise be the Beneficial Owner of ten percent
(10%) or more (fifteen percent (15%) or more in the case of
any person identified in clause (iv) above) of the shares of
Common Stock has become such inadvertently (including, without
limitation, because (1) such person was unaware that it
Beneficially Owned ten percent (10%) or more (fifteen percent
(15%) or more in the case of any person identified in clause
(iv) above) of the shares of Common Stock or (2) such person
was aware of the extent of such beneficial ownership but such
person acquired beneficial ownership of such shares of Common
Stock without the intention to change or influence the control
of the Company) and such person divests itself as promptly as
practicable of a sufficient number of shares of Common Stock
so that such person would no longer be the Beneficial Owner of
ten percent (10%) or more (fifteen percent (15%) or more in
the case of any person identified in clause (iv) above), then
such person shall not be deemed to be, or have been, the
Beneficial Owner of ten percent (10%) or more (fifteen percent
(15%) or more in the case of any person identified in clause
(iv) above) of the shares of Common Stock, and no Change in
Control shall be deemed to have occurred.
(2) During any period of two consecutive years, individuals who at
the beginning of such period constituted the Board of
Directors of the Company and any new director (other than a
director initially elected or nominated as a director as a
result of an actual or threatened election contest with
respect to directors or any other actual or threatened
solicitation of proxies by or on behalf of such director)
whose election by the Board of Directors or nomination for
election by the Company's shareholders was approved by a vote
of at least two-thirds (2/3) of the directors then still in
office who either were directors at the beginning of the
period or whose election or nomination for election was
previously so approved, cease for any reason to constitute a
majority thereof.
(3) There shall be consummated any consolidation, merger or other
combination of the Company with any other person or entity
other than:
(i) a consolidation, merger or other combination which
would result in the voting securities of the Company
outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by
being converted into voting securities of the
surviving entity) more than fifty-one percent (51%)
of the combined voting power of the voting securities
of the Company or such surviving entity outstanding
immediately after such consolidation, merger or other
combination; or
(ii) a consolidation, merger or other combination effected
to implement a recapitalization and/or reorganization
of the Company (or similar transaction), or any other
consolidation, merger or other combination of the
Company, which results in no person (as such term is
used in Sections 13(d) and 14(d)(2) of the Exchange
Act), together with all Affiliates and Associates of
such person, becoming the Beneficial Owner of ten
percent (10%) or more (fifteen percent (15%) or more
in the case of any person identified in Section
13(d)(2)(D)) of the combined voting power of the
Company's then outstanding securities.
(4) There shall be consummated any sale, lease, assignment,
exchange, transfer or other disposition (in one transaction or
a series of related transactions) of fifty percent (50%) or
more of the assets or earning power of the Company (including,
A-9
without limitation, any such sale, lease, assignment,
exchange, transfer or other disposition effected to implement
a recapitalization and/or reorganization of the Company (or
similar transaction)) which results in any person (as such
term is used in Sections 13(d) and 14(d)(2) of the Exchange
Act), together with all Affiliates and Associates of such
person, owning a proportionate share of such assets or earning
power greater than the proportionate share of the voting power
of the Company that such person, together with all Affiliates
and Associates of such person, owned immediately prior to any
such sale, lease, assignment, exchange, transfer or other
disposition.
(5) The shareholders of the Company approve a plan of complete
liquidation of the Company.
SECTION 13. MISCELLANEOUS
(a) Any provision of this Trust Agreement prohibited by law shall be
ineffective to the extent of any such prohibition, without invalidating
the remaining provisions hereof.
(b) This Trust Agreement shall be governed by and construed in accordance
with the laws of Ohio.
(c) Any notice required pursuant to this Trust Agreement shall be delivered
(1) personally, (2) via overnight delivery, or (3) via certified or
registered mail, return receipt requested to the parties at the
following addresses (or such subsequent address as any party may
furnish in writing to the other parties):
Grantor: ______________________________
______________________________
______________________________
Trustee: Wachovia Bank, National Association
Mail Code: NC6251
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇-▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Executive Services
Administrator: The ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: Vice President - Compensation & Benefits
(d) Grantor shall furnish Trustee a written designation of beneficiary(ies)
of this Trust and allocation the Trust Funds among such
beneficiary(ies), which designation and allocation may be amended in
writing from time to time by Grantor. In the event Grantor fails to
designate beneficiary(ies) or in the event that such beneficiary(ies)
are not surviving at the time of distribution, the beneficiary shall be
Grantor's spouse and if none, his estate.
A-10
(e) Neither the Company nor any person other than the Grantor and, in the
event of the Grantor's death, the Grantor's beneficiary(ies), and the
Trustee acting as such, have any right, title or interest in the assets
of the Trust. The assets of the Trust shall at no time be subject to
the rights of creditors of the Company.
IN WITNESS WHEREOF, this Individual Grantor Trust Agreement has been executed on
behalf of the parties hereto on the day and year first above written.
GRANTOR TRUSTEE
By: ___________________________________ By: ________________________________
Its: _______________________________
ATTEST:
ATTEST:
By: ___________________________________ By: ________________________________
Its: _______________________________
UNDERSTOOD AND AGREED AS ADMINISTRATOR:
THE ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ COMPANY
By: ___________________________________
Its: __________________________________
A-11
EXHIBIT B
APPROVED INVESTMENTS
TYPE FUND NAME
Cash Fidelity Retirement Government Money Market
Fixed Income Spartan Short-Intermediate Municipal Income
Fixed Income Fidelity U.S. Bond Index
Fixed Income PIMCO Low Duration Fund
Balanced Fidelity Puritan
Equity Fidelity Equity Income
Equity Mutual Shares
Equity Fidelity Spartan U.S. Equity Index
Equity Fidelity Contrafund
Equity Fidelity Low-Price Stock
Equity Fidelity Magellan
Equity Fidelity Mid-Cap Stock
Equity Manager's Special Equity
Equity Fidelity Diversified International
Equity ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ Common Stock
Freedom Funds Fidelity Freedom Income
Freedom Funds Fidelity Freedom 2000
Freedom Funds Fidelity Freedom 2010
Freedom Funds Fidelity Freedom 2020
Freedom Funds Fidelity Freedom 2030
Freedom Funds Fidelity Freedom 2040
NOTES:
Choosing investments other than the Approved Investment may result in the
suspension on investment income tax gross-up.
The administrator reserves the right to change the list of Approved Investment
from time-to-time without prior written notice to Grantor/Employee.
B-1
EXHIBIT C
TAX ASSUMPTIONS
Federal income tax rate: the highest marginal Federal income tax rate that
applies to the type of income being taxed as adjusted for the phase out of
federal deductions under current law (or as adjusted under any subsequently
enacted similar provisions of the Code).
State income tax rate: the highest adjusted marginal state tax income tax rate
that applies to the type of income being taxed based on the Employee's workplace
location as adjusted for the federal deduction of state and local taxes and the
phase out of federal deductions under current law (or as adjusted under any
subsequently enacted similar provisions of the Code).
Local income tax rate: the highest adjusted marginal local income tax rate that
applies to the type of income being taxed based on the Employee's residence and
workplace location as adjusted for the federal deduction of state and local
taxes and the phase out of federal deductions under current law (or as adjusted
under any subsequently enacted similar provisions of the Code).
OASDI: the applicable Hospital Insurance rate of tax under Section 3101(b) of
the Code during the applicable year and, if the Employee has not exceeded the
applicable Old Age, Survivors and Disability Income ("OASDI") base amount under
Section 3121(a) of the Code, the applicable OASDI rate of tax under Section
3101(a) of the Code during the applicable year, provided, however, that the
OASDI rate of tax shall be taken into account in this calculation only to the
extent necessary to reimburse the Employee for OASDI tax up to the OASDI base
amount.
The foregoing tax assumptions are based upon the current state of tax law and
interpretation. The Company reserves the right to adjust in good faith any of
the above assumptions to take into consideration changes in the tax law adopted
subsequent to the date of this Agreement.
C-1