EXHIBIT 10(e)
IES INDUSTRIES INC. GRANTOR TRUST
FOR SUPPLEMENTAL RETIREMENT AGREEMENTS
THIS AGREEMENT, made this 15th day of August, 1997, by and
between IES INDUSTRIES INC. ("the Company") and NORWEST BANK
IOWA, N.A. (the "Trustee");
W I T N E S S E T H:
WHEREAS, the Company has adopted or entered into the
nonqualified supplemental retirement plans and agreements (the
"Plans") listed in Appendix A;
WHEREAS, the Company has incurred or expects to incur
liability under the terms of such Plans with respect to the
individuals participating in such Plans;
WHEREAS, the Company wishes to establish a trust (the
"Trust") and to contribute to the Trust assets that shall be held
therein, subject to the claims of the Company's creditors in the
event of the Company's Insolvency, as herein defined, until paid
to Plan participants and their beneficiaries in such manner and
at such times as specified in the Plans;
WHEREAS, it is the intention of the parties that this Trust
shall constitute an unfunded arrangement and shall not affect the
status of the Plans as unfunded plans maintained for the purpose
of providing deferred compensation for a select group of
management or highly compensated employees for purposes of Title
I of the Employee Retirement Income Security Act of 1974; and
WHEREAS, it is the intention of the Company to make
contributions to the Trust to provide itself with a source of
funds to assist it in the meeting of its liabilities under the
Plans;
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 TRUST
1.1 The Company hereby deposits with the Trustee, in trust,
the sum of $1,000, which shall become the principal of the Trust
to be held, administered and disposed of by the Trustee as
provided in this Trust Agreement.
1.2 The Trust hereby established shall be irrevocable.
1.3 The Trust is intended to be a grantor trust, of which
the Company is the grantor, within the meaning of subpart E, part
I, subchapter J, chapter 1, subtitle A of the Internal Revenue
Code of 1986, as amended, and shall be construed accordingly.
1.4 The principal of the Trust, and any earnings thereon,
shall be held separate and apart from other funds of the Company
and shall be used exclusively for the uses and purposes of Plan
participants and general creditors as herein set forth. Plan
participants and their beneficiaries shall have no preferred
claim on, or any beneficial ownership interest in, any assets of
the Trust. Any rights created under the Plans and this Trust
Agreement shall be mere unsecured contractual rights of Plan
participants and their beneficiaries against the Company. Any
assets held by the Trust will be subject to the claims of the
Company's general creditors under federal and state law in the
event of Insolvency, as defined in Section 3.1 herein.
1.5 Within ten business days following a Change in Control,
the Company shall make an irrevocable contribution to the Trust
in an amount that is not less than the sum of the payments,
determined on an undiscounted basis, which are then due or which
may thereafter become due to participants or beneficiaries
pursuant to the terms of the Plans.
1.6 As of each December 31 following a Change in Control
("Valuation Date"), the Company shall determine the amount of the
contribution which would have been required pursuant to Section
1.5 if the Change in Control had occurred on such Valuation Date.
If the amount so determined exceeds the fair market value of the
Trust assets on such Valuation Date, the Company shall, within
ten business days following such Valuation Date, make an
irrevocable contribution to the Trust in an amount which is not
less than such excess.
1.7 The Company, in its sole discretion, may at any time,
or from time to time, make additional deposits of cash or other
property in trust with the Trustee to augment the principal to be
held, administered and disposed of by the Trustee as provided in
this Trust Agreement. Neither the Trustee nor any Plan
participant or beneficiary shall have any right to compel such
additional deposits.
SECTION 2
PAYMENTS TO PLAN PARTICIPANTS AND THEIR BENEFICIARIES
2.1 The Company shall deliver to the Trustee a schedule
(the "Payment Schedule") that indicates the amounts payable in
respect of each Plan participant (and his or her beneficiaries),
or that provides a formula or other instructions acceptable to
the Trustee for determining the amounts so payable, the form in
which such amount is to be paid (as provided for or available
under the Plans), and the time of commencement for payment of
such amounts. Except as otherwise provided herein, the Trustee
shall make payments to the Plan participants and their
beneficiaries in accordance with the most recent Payment Schedule
received by the Trustee. The Trustee shall make provision for
the reporting and withholding of any federal, state or local
taxes that may be required to be withheld with respect to the
payment of benefits pursuant to the terms of the Plans and shall
pay amounts withheld to the appropriate taxing authorities or
determine that such amounts have been reported, withheld and paid
by the Company.
2.2 The entitlement of a Plan participant or his or her
beneficiaries to benefits under the Plans shall be determined by
the Company or such party as it shall designate under the Plans,
and any claim for such benefits shall be considered and reviewed
under the procedures set out in the Plans.
2.3 The Company may make payment of benefits directly to
Plan participants or their beneficiaries as they become due under
the terms of the Plans. The Company shall notify the Trustee of
its decision to make payment of benefits directly prior to the
time amounts are payable to participants or their beneficiaries.
In addition, if the principal of the Trust, and any earnings
thereon, are not sufficient to make payments of benefits in
accordance with the terms of the Plans, the Company shall make
the balance of each such payment as it falls due. The Trustee
shall notify the Company where principal and earnings are not
sufficient.
SECTION 3
TRUSTEE RESPONSIBILITY REGARDING PAYMENTS
TO TRUST BENEFICIARY WHEN COMPANY IS INSOLVENT
3.1 The Trustee shall cease payment of benefits to Plan
participants and their beneficiaries if the Company is Insolvent.
The Company shall be considered "Insolvent" for purposes of this
Trust Agreement if it is unable to pay its debts as they become
due, or if it is subject to a pending proceeding as a debtor under the
United States Bankruptcy Code.
3.2 At all times during the continuance of this Trust, as
provided in Section 1.4 hereof, the principal and income of the
Trust shall be subject to claims of general creditors of the
Company under federal and state law as set forth below.
a. The Board of Directors and the Chief Executive
Officer of the Company shall have the duty to inform the
Trustee in writing of the Company's Insolvency. If a person
claiming to be a creditor of the Company alleges in writing
to the Trustee that the Company has become Insolvent, the
Trustee shall determine whether the Company is Insolvent
and, pending such determination, the Trustee shall
discontinue payment of benefits to Plan participants or
their beneficiaries.
b. Unless the Trustee has actual knowledge of the
Company's Insolvency, or has received notice from the
Company or a person claiming to be a creditor alleging that
the Company is Insolvent, the Trustee shall have no duty to
inquire whether the Company is Insolvent. The Trustee may
in all events rely on such evidence concerning the Company's
solvency as may be furnished to the Trustee and that
provides the Trustee with a reasonable basis for making a
determination concerning the Company's solvency.
c. If at any time the Trustee has determined that the
Company is Insolvent, the Trustee shall discontinue payments
to Plan participants or their beneficiaries and shall hold
the assets of the Trust for the benefit of the Company's
general creditors. Nothing in this Trust Agreement shall in
any way diminish any rights of Plan participants or their
beneficiaries to pursue their rights as general creditors of
the Company with respect to benefits due under the Plans or
otherwise.
d. The Trustee shall resume the payment of benefits
to Plan participants or their beneficiaries in accordance
with Section 2 of this Trust Agreement only after the
Trustee has determined that the Company is not Insolvent (or
is no longer Insolvent).
3.3 Provided that there are sufficient assets, if the
Trustee discontinues the payment of benefits from the Trust
pursuant to Section 3.2 hereof and subsequently resumes such
payments, the first payment following such discontinuance shall
include the aggregate amount of all payments due to Plan
participants or their beneficiaries under the terms of the Plans
for the period of such discontinuance, less the aggregate amount
of any payments made to Plan participants or their beneficiaries
by the Company in lieu of the payments provided for hereunder
during any such period of discontinuance.
SECTION 4
PAYMENTS TO COMPANY
Except as provided in Section 3 hereof, after the Trust has
become irrevocable, the Company shall have no right or power to
direct the Trustee to return to the Company or to divert to
others any of the Trust assets before all payment of benefits
have been made to Plan participants and their beneficiaries
pursuant to the terms of the Plans.
SECTION 5
INVESTMENT AUTHORITY
5.1 Except as otherwise specifically provided herein, and
subject to such investment guidelines as may be adopted by the
Company and delivered to the Trustee, the Trustee may invest,
reinvest, and hold the assets of the Trust in whatever form of
investment the Trustee may see fit (including, but not limited
to, contracts or policies of insurance), and in making or holding
such investments, the Trustee shall not be restricted to those
investments which are authorized by the laws of any state for the
investment of trust funds.
5.2 The Company may at any time, and from time to time,
appoint one or more investment managers to manage and control all
or any part of the Trust's assets. Any such investment manager
shall be a registered investment adviser under the Investment
Advisers Act of 1940; a bank, as defined in that Act; or an
insurance company that is qualified to manage, acquire or dispose
of the Plans' assets under the laws of more than one state. Upon
receipt of written notice of the appointment of an investment
manager, the Trustee shall segregate the portion of the assets of
the Trust to be managed by the investment manager into a separate
"Investment Manager Account." An investment manager shall have
full discretion and authority to invest, reinvest or dispose of
the Trust assets in its Investment Manager Account, and the
Trustee shall follow the directions of an investment manager with
respect to the investment of Trust assets allocated to such
Investment Manager's Account; provided, however, that if the
Trustee shall not have received contrary instructions from an
investment manager, the Trustee may invest for short term
purposes any cash in its custody in short term, cash equivalent
investments or in common or collective funds composed thereof.
To the extent necessary to comply with the directions of an
investment manager, the Trustee may enter into a subtrust
agreement with the investment manager. The Company may terminate
the appointment of an investment manager at any time, in which
event the Company shall either appoint a successor to such
investment manager or direct the Trustee to return the assets in
the Investment Manager's Account to the unsegregated portion of
the Trust.
SECTION 6
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.
SECTION 7
ACCOUNTING BY 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 the Company and the Trustee.
Within 60 days following the close of each calendar year, and
within 60 days after the removal or resignation of the Trustee,
the Trustee shall deliver to the Company 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.
SECTION 8
RESPONSIBILITY OF TRUSTEE
8.1 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 the Company
or an investment manager which is contemplated by, and in
conformity with, the terms of the Plans or this Trust and is
given in writing by the Company or such investment manager. In
the event of a dispute between the Company and a party, the
Trustee may apply to a court of competent jurisdiction to resolve
the dispute.
8.2 If the Trustee undertakes or defends any litigation
arising in connection with this Trust, the Company agrees to
indemnify the Trustee against the Trustee's costs, expenses and
liabilities (including, without limitation, attorneys' fees and
expenses) relating thereto and to be primarily liable for such
payments. If the Company does not pay such costs, expenses and
liabilities in a reasonably timely manner, the Trustee may obtain
payment from the Trust.
8.3 The Trustee may consult with legal counsel (who may
also be counsel for the Company generally) with respect to any of
its duties or obligations hereunder.
8.4 The Trustee may hire agents, accountants, actuaries,
investment advisors, financial consultants or other professionals
to assist it in performing any of its duties or obligations
hereunder, and may reasonably compensate them out of the Trust
assets.
8.5 The Trustee shall have, without exclusion, all powers
conferred on trustees by applicable law, unless expressly
provided otherwise herein; provided, however, that if an
insurance policy is held as an asset of the Trust, the Trustee
shall have no power to name a beneficiary of the policy other
than the Trust, to assign the policy (as distinct from conversion
of the policy to a different form) other than to a successor
Trustee, or to loan to any person the proceeds of any borrowing
against such policy.
8.6 Notwithstanding any powers granted to the Trustee
pursuant to this Trust Agreement or 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 of section 301.7700-2 of the
Procedure and Administrative Regulations promulgated pursuant to
the Internal Revenue Code.
SECTION 9
COMPENSATION AND EXPENSES OF TRUSTEE
The Company shall pay all administrative and the Trustee's
fees and expenses. If not so paid, the fees and expenses shall
be paid from the Trust.
SECTION 10
RESIGNATION OR REMOVAL OF TRUSTEE
10.1 The Trustee may resign at any time by written notice to
the Company, which shall be effective 30 days after receipt of
such notice unless the Company and the Trustee agree otherwise.
10.2 Prior to a Change in Control, the Trustee may be
removed by the Company on 30 days notice or upon shorter notice
accepted by the Trustee. Following a Change in Control, the
Trustee may not be removed by the Company unless 65% of all
employees or former employees of the Company who are or may
become entitled to the payment of benefits pursuant to the Plans
consent in writing to such removal.
10.3 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 30 days after receipt of notice of resignation,
removal or transfer, unless the Company extends the time limit.
10.4 If the Trustee resigns or is removed, a successor shall
be appointed, in accordance with Section 11 hereof, by the
effective date of resignation or removal under Section 10.1 or
10.2 of this section. If no such appointment has been made, the
Trustee may appoint a successor Trustee or it 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 11
APPOINTMENT OF SUCCESSOR
11.1 If the Trustee resigns or is removed in accordance with
Section 10.1 or 10.2 hereof, the Company, or if a Change in
Control shall previously have occurred the Company and at least
65% of all employees or former employees of the Company who are
or may become entitled to the payment of benefits pursuant to the
Plans, may appoint any third party, such as a bank trust
department or other party that may be granted corporate trustee
powers under state law, as a successor to replace the Trustee
upon resignation or removal. The appointment shall be effective
when accepted in writing by the new Trustee, who shall have all
of the rights and powers of the former Trustee, including
ownership rights in the Trust assets. The former Trustee shall
execute any instrument necessary or reasonably requested by the
Company or the successor Trustee to evidence the transfer.
11.2 The successor Trustee need not examine the records and
acts of any prior Trustee and may retain or dispose of existing
Trust assets, subject to Sections 7 and 8 hereof. 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 a successor Trustee.
SECTION 12
AMENDMENT OR TERMINATION
12.1 This Trust Agreement may be amended by a written
instrument executed by the Trustee and the Company.
Notwithstanding the foregoing, no such amendment shall conflict
with the terms of the Plans or shall make the Trust revocable
after it has become irrevocable in accordance with Section 1.2
hereof.
12.2 The Trust shall not terminate until the date on which
Plan participants and their beneficiaries are no longer entitled
to benefits pursuant to the terms of the Plans. Upon termination
of the Trust any assets remaining in the Trust shall be returned
to the Company.
12.3 Notwithstanding the foregoing:
a. This Trust Agreement may not be amended by the
Company prior to a Change in Control without the written
approval of any Plan participant or beneficiary whose
rights or protections under a Plan or this Agreement may be
reduced, impaired, or otherwise adversely affected by the
amendment.
b. This Trust Agreement may not be amended by the
Company in any respect following a Change in Control without
the written approval of all employees or former employees of
the Company who are, or may become, entitled to the payment
of benefits pursuant to the Plans.
c. The Company may terminate this Trust prior to the
date specified in Section 12.2 upon the written approval of
all employees or former employees of the Company who are or
may become entitled to the payment of benefits pursuant to
the Plans.
SECTION 13
MISCELLANEOUS
13.1 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.
13.2 Benefits payable to Plan participants and their
beneficiaries under this Trust Agreement may not be anticipated,
assigned (either at law or in equity), alienated, pledged,
encumbered or subjected to attachment, garnishment, levy,
execution or other legal or equitable process.
13.3 This Trust Agreement shall be governed by and construed
in accordance with the laws of Iowa, except to the extent the
same are preempted by federal law.
13.4 This Trust Agreement shall be binding upon, and shall
inure to the benefit of, any successor (whether direct or
indirect, by purchase, merger, consolidation, or otherwise) to
all or substantially all of the business or assets of the
Company. The Company (and any successor to the Company) may not
otherwise assign its obligations under this Trust Agreement
without the prior written approval of all employees or former
employees of the Company who are, or may become, entitled to the
payment of benefits pursuant to the Plans; provided, however,
that, subsequent to the merger of the Company with WPL Holdings,
Inc. and Interstate Power Company in accordance with the
Agreement and Plan of Merger dated November 10, 1995, as amended,
and prior to a Change in Control, the Company (or its successor)
may assign its obligations under this agreement to any
corporation, 100% of the stock of which is owned (either directly
or through one or more subsidiaries) by the entity resulting from
such merger.
13.5 For the purposes of this Trust Agreement, Change in
Control shall mean:
a. the purchase or other acquisition by any person,
entity or group of persons, within the meaning of section
13(d) or 14(d) of the Securities Exchange Act of 1934, or
any comparable successor provisions, of ownership (within
the meaning of Rule 13d-3 promulgated under that Act) of 20%
or more of the combined voting power of the Company's
outstanding voting securities entitled to vote generally in
the election of directors;
b. the approval by the stockholders of the Company of
a reorganization, merger or consolidation, in each case,
with respect to which persons who were stockholders of the
Company immediately prior to such reorganization, merger or
consolidation do not, immediately thereafter, own more than
50% of the combined voting power of the reorganized, merged
or consolidated entity's then outstanding securities
entitled to vote generally in the election of directors;
c. the approval by the stockholders of the Company of
a liquidation or dissolution of the Company or of the sale
of all or substantially all of the Company's assets; or
d. the failure of individuals who were Directors of
the Company at the beginning of any two consecutive year
period (including, for this purpose, any new Director whose
election or nomination for election was approved by a vote
of at least two-thirds of the Directors then still in office
who were Directors at the beginning of such period) to
constitute a majority of the Company's Board of Directors;
provided, however, that the merger of the Company with WPL
Holdings, Inc. and Interstate Power Company in accordance with
the Agreement and Plan of Merger dated November 10, 1995, as
amended, shall not constitute a Change in Control unless and
until the resulting corporation fails to make any payment due
pursuant to a Plan at the time such payment is due.
SECTION 14
EFFECTIVE DATE
The effective date of this Trust Agreement shall be August
1, 1997.
* * * * *
IN WITNESS WHEREOF, this instrument has been executed as of
the day and year last above written.
IES INDUSTRIES INC.
By:
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President & Chief Operating Officer
NORWEST BANK IOWA, N.A.
By:
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Employee Benefits Manager
APPENDIX A
PLANS
The following plans and agreements shall be funded through
the Trust:
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