AMENDED AND RESTATED
LIQUIDATING TRUST AGREEMENT
OF ▇▇▇▇▇ LIQUIDATING TRUST
TABLE OF CONTENTS
Page
ARTICLE I NAMES AND DEFINITIONS...............................................2
1.1 Defined Terms...............................................2
ARTICLE II DECLARATION OF TRUST; APPOINTMENT OF TRUSTEES; GRANT
TO TRUST AND NATURE OF TRANSFER......................................5
2.1 Declaration of Trust........................................5
2.2 Appointment of Trustees.....................................5
2.3 Grant.......................................................5
2.4 Purpose of Trust............................................5
2.5 No Reversion to the Company.................................6
2.6 Instruments of Further Assurance............................6
2.7 Subsidiaries................................................6
2.8 Payment of Liabilities......................................7
2.9 Initial Beneficiaries.......................................7
2.10 Notice to Unlocated Stockholders............................7
ARTICLE III BENEFICIARIES.....................................................7
3.1 Beneficial Interests........................................7
3.2 Beneficiaries are Parties...................................8
3.3 Rights of Beneficiaries.....................................8
3.4 Limitations on Transfer of Interests of Beneficiaries.......9
3.5 Trustees as Beneficiary.....................................9
ARTICLE IV DURATION AND TERMINATION OF THE TRUST..............................9
4.1 Duration....................................................9
4.2 Other Obligations of Trustees upon Termination.............10
Article V ADMINISTRATION OF TRUST ASSETS.....................................10
5.1 Sale of Trust Assets.......................................10
5.2 Efforts to Resolve Claims and Liabilities..................10
5.3 Continued Collection of Property of Trust Assets...........10
5.4 Restriction on Trust Assets................................10
5.5 Payment of Expenses and Liabilities........................11
5.6 Interim Distributions......................................11
5.7 Final Distribution.........................................11
5.8 Reports to Beneficiaries and Others........................12
5.9 Federal Income Tax Information.............................12
5.10 Books and Records..........................................13
Article VI POWERS OF AND LIMITATIONS ON THE SPONSOR TRUSTEES.................13
6.1 Limitations on Sponsor Trustees............................13
6.2 Specific Powers of the Sponsor Trustees....................13
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6.3 Actions by Managing Trustee................................15
6.4 Extraordinary Actions by Sponsor Trustees..................15
Article VII LIMITATION OF LIABILITY CONCERNING THE SPONSOR
TRUSTEES, BENEFICIARIES, EMPLOYEES AND AGENTS.......................16
7.1 Generally..................................................16
7.2 Reliance by Sponsor Trustee................................17
7.3 Agents, Counsel, Etc.......................................17
7.4 Limitation on Liability to Third Persons...................17
7.5 Recitals...................................................18
7.6 Indemnification............................................18
7.7 No Duty Not to Compete.....................................18
7.8 Fiduciary Duties...........................................19
Article VIII Sponsor TRUSTEES AND SUCCESSOR SPONSOR TRUSTEES.................19
8.1 Number and Qualification of Sponsor Trustees...............19
8.2 Resignation and Removal of Sponsor Trustees................19
8.3 Appointment of Successor Sponsor Trustee...................19
8.4 Acceptance of Appointment by Successor Sponsor Trustee.....19
8.5 Managing Trustee...........................................20
8.6 Bonds......................................................20
Article IX COMPENSATION OF SPONSOR TRUSTEES..................................20
9.1 Amount of Compensation.....................................20
9.2 Expenses...................................................21
Article X THE DELAWARE TRUSTEE...............................................21
10.1 Purpose; Power and Authority; Etc..........................21
10.2 Acceptance of Trusts.......................................21
10.3 Reliance...................................................21
10.4 Agents, Counsel, Etc.......................................22
10.5 Not Acting in Individual Capacity..........................22
10.6 Compensation...............................................22
10.7 Reimbursement; Indemnity; Insurance........................22
10.8 No Action Except as Specified in Agreement or Instructions.22
10.9 Duties, Etc................................................23
10.10 Resignation and Removal....................................23
10.11 Merger, Succession.........................................23
10.12 Amendments to Article X; Construction......................24
Article XI protection of persons dealing with trustees.......................24
Article XII CONCERNING THE BENEFICIARIES.....................................24
12.1 Evidence of Action by Beneficiaries........................24
12.2 Limitation on Suits by Beneficiaries.......................24
12.3 Requirement of Undertaking.................................25
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Article XIII MEETING OF BENEFICIARIES........................................25
13.1 Purpose of Meetings........................................25
13.2 Meeting Called by the Sponsor Trustees.....................25
13.3 Meeting Called on Request of Beneficiaries.................25
13.4 Persons Entitled to Vote at Meeting of Beneficiaries.......25
13.5 Quorum.....................................................25
13.6 Adjournment of Meeting.....................................26
13.7 Conduct of Meetings........................................26
13.8 Record of Meeting..........................................26
Article XIV AMENDMENTS.......................................................26
14.1 Consent of Trustees and Beneficiaries......................26
14.2 Notice and Effect of Amendment.............................26
Article XV MISCELLANEOUS PROVISIONS..........................................27
15.1 Filing Documents...........................................27
15.2 Intention of Parties to Establish Trust....................27
15.3 Beneficiaries Have No Rights or Privileges as
Stockholders of the Company................................27
15.4 Laws as to Construction....................................27
15.5 Severability...............................................27
15.6 Notices....................................................27
15.7 Counterparts...............................................29
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AMENDED AND RESTATED LIQUIDATING TRUST AGREEMENT
OF ▇▇▇▇▇ LIQUIDATING TRUST
THIS AMENDED AND RESTATED LIQUIDATING TRUST AGREEMENT, dated as of August 27,
2004 (as the same may be amended, supplemented, or restated from time to time,
this "Agreement") by and among ▇▇▇▇▇ Realty Investors, Inc., a self-administered
and self-managed real estate investment trust organized under the laws of the
State of Michigan (the "Company"), ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ("▇▇▇▇▇"), ▇▇▇▇ ▇▇▇▇▇
("▇▇▇▇▇"), and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, III ("▇▇▇▇▇▇▇") (▇▇▇▇▇, ▇▇▇▇▇ and ▇▇▇▇▇▇▇ are
referred to not in their individual capacities but solely as trustees hereunder
as the "Sponsor Trustees") and Wachovia Bank of Delaware, National Association
(together with its successors and permitted assigns, in its individual capacity,
the "Trust Company," and not in its individual capacity but solely as trustee
hereunder, the "Delaware Trustee").
WHEREAS, the Company's Board of Directors (the "Board") and
the Company's stockholders have approved the voluntary dissolution of the
Company pursuant to a Plan of Complete Liquidation and Dissolution (the "Plan");
WHEREAS, the Plan provides, among other things, that the Board
will cause the Company to dispose of all of the assets of the Company, wind up
its affairs, pay or adequately provide for the payment of all of its liabilities
and distribute to or for the benefit of its stockholders all of the Company's
assets, including interests in any liquidating trust established in connection
with the complete liquidation of the Company;
WHEREAS, the Plan further provides, among other things, that,
in the event that the Board determines that it is not feasible for the Company
to pay, or adequately provide for, all debts and liabilities of the Company
(including costs and expenses incurred and anticipated to be incurred in
connection with the liquidation of the Company) at the time the final
liquidating distribution is made, or, if earlier, the latest applicable date to
avoid payment by the Company of federal income taxes, or the Board determines
that it is not advisable to distribute at such time any of the property then
held by or for the account of the Company because the property is not reasonably
susceptible of distribution to stockholders or otherwise, the Company may
transfer and assign, at such times as is determined by the Company, to a
liquidating trust as designated by the Board, all of its then remaining assets
and liabilities;
WHEREAS, the Trust (as defined below) was formed on or about
July 30, 2004 and its governing instrument is that certain Trust Agreement,
dated as of July 30, 2004, by and between the Company and the Trust Company (the
"Original Trust Agreement");
WHEREAS, the parties wish to amend and restate in its entirety
the Original Trust Agreement and to constitute this Agreement the governing
instrument of the Trust.
NOW, THEREFORE, in consideration of the premises and other
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
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ARTICLE I
NAMES AND DEFINITIONS
1.1 Defined Terms. For all purposes of this instrument, unless the
context otherwise requires:
(a) "Agreement" has the meaning given to such term in the
introductory paragraph.
(b) "Affiliate" of a Person shall mean any other Person
controlling, controlled by or under common control with the Person in question.
(c) "Beneficial Interest" shall mean, for each Beneficiary,
such Beneficiary's proportionate share of the Trust Assets. The Beneficial
Interest of an Initial Beneficiary shall be initially determined by the ratio of
the number of Shares held of record by such Initial Beneficiary as of the close
of business on the Record Date to the total number of Shares issued and
outstanding on such Record Date. Thereafter, the Beneficial Interest of a
Beneficiary shall be determined by the ratio of the number of Units held by such
Beneficiary to the total number of Units held by all Beneficiaries.
(d) "Beneficiary" shall mean, initially, each Initial
Beneficiary and, thereafter, each Initial Beneficiary who holds Units and each
permitted transferee of Units initially held by an Initial Beneficiary and
subsequently transferred to such transferee pursuant to and in accordance with
the terms and conditions of this Agreement, as reflected in the records of the
Trust.
(e) "Board" shall have the meaning set forth in the
recitals.
(f) "Business Day" shall mean any day other than a Saturday
or a Sunday or a day on which banks located in Wilmington, Delaware or
Charlotte, North Carolina are required or permitted by law or executive order to
remain closed.
(g) "Certificate of Trust" shall mean the certificate of
trust filed with the Secretary of State on July 30, 2004 in connection with the
formation of the Trust.
(h) "Code" shall have the meaning set forth in Section
2.4(d) hereof.
(i) "Company" shall have the meaning set forth in the
introductory paragraph.
(j) "Delaware Act" shall mean Chapter 38 of Title 12 of the
Delaware Code, 12 Del. C. ss.3801, et seq., as amended from time to time and any
successor thereto.
(k) "Delaware Trustee" shall have the meaning set forth in
the introductory paragraph.
(l) "Holdback" shall have the meaning set forth in Section
5.7 hereof.
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(m) "Holdback Depository" shall have the meaning set forth
in Section 5.7 hereof.
(n) "▇▇▇▇▇" shall have the meaning set forth in the
introductory paragraph.
(o) "Initial Beneficiary" shall mean each of the
Stockholders.
(p) "Kross" means ▇▇▇▇▇ ▇. ▇▇▇▇▇.
(q) "▇▇▇▇▇" shall have the meaning set forth in the
introductory paragraph.
(r) "Liabilities" shall mean all of the Company's
unsatisfied debts, claims, liabilities, commitments, suits and other
obligations, whether contingent or fixed or otherwise (including, without
limitation, any costs and expenses incurred or to be incurred in connection with
the liquidation of the Company).
(s) "Managing Trustee" shall mean ▇▇▇▇▇, and any successor
designated as Managing Trustee pursuant to and in accordance with the terms of
this Agreement.
(t) "Original Trust Agreement" shall have the meaning set
forth in the recitals.
(u) "Person" shall mean an individual, a corporation, a
partnership, an association, a joint stock company, a limited liability company,
a trust, a joint venture, any unincorporated organization, or a government or
political subdivision thereof.
(v) "Plan" shall have the meaning set forth in the recitals.
(w) "Record Date" shall mean the close of business eastern
time on August 27, 2004.
(x) "Required Consent of the Beneficiaries" shall mean, when
a quorum of Beneficiaries is present in person or by proxy at a meeting of
Beneficiaries, the votes cast by Beneficiaries in favor of an action exceed the
votes cast opposing the action.
(y) "Retained Assets" shall have the meaning set forth in
Section 2.3 hereof.
(z) "▇▇▇▇▇▇▇" shall have the meaning set forth in the
introductory paragraph.
(aa) "Secretary of State" shall mean the Secretary of State
of the State of Delaware.
(bb) "Shares" shall mean the shares of common stock, $0.01
par value per share, of the Company.
(cc) "Sponsor Trustees" shall mean Lewis, Holup, ▇▇▇▇▇▇▇, and
any successors thereto or additional Persons designated Sponsor Trustees,
pursuant to and in accordance with the terms of this Agreement.
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(dd) "Stockholders" shall mean the holders of record of the
outstanding Shares of the Company at the close of business on the Record Date.
(ee) "Subsidiaries" shall include:
(i) Bricktown ▇▇▇▇▇ LLC, a Delaware limited
liability company;
(ii) ▇▇▇▇▇ Midwest LLC, a Michigan limited liability
company;
(iii) ▇▇▇▇▇ Midwest One LLC, a Michigan limited
liability company;
(iv) ▇▇▇▇▇ WSC Manager LLC, a Michigan limited
liability company; and
(v) ▇▇▇▇▇ WSC LLC, a Michigan limited liability
company wholly owned by ▇▇▇▇▇ WSC Manager LLC.
(ff) "Transfer Date" shall mean 11:45 p.m. Eastern Time on
August 27, 2004.
(gg) "Treasury Regulation" shall mean regulations, including
proposed or temporary regulations, promulgated under the Code.
(hh) "Trust" shall mean the ▇▇▇▇▇ Liquidating Trust, a
Delaware statutory trust formed pursuant to the Original Trust Agreement and the
filing of the Certificate of Trust with the Secretary of State.
(ii) "Trust Assets" shall mean all the property held from
time to time by the Trust under this Agreement, which initially shall consist of
the Retained Assets (excluding any liquidating distributions declared, but
unpaid, having a record date prior to the Transfer Date), and in addition, shall
thereafter include all dividends, distributions, rents, royalties, income,
payments and recoveries of claims, proceeds and other receipts of, from, or
attributable to any assets held by the Trust, less any of the foregoing utilized
by the Sponsor Trustees to pay expenses of the Trust, satisfy Liabilities or to
make distributions to the Beneficiaries pursuant to the terms and conditions
hereof.
(jj) "Trust Company" shall have the meaning set forth in the
introductory paragraph.
(kk) "Trustees" shall mean the Sponsor Trustees and the
Delaware Trustee under this Agreement.
(ll) "Units" shall have the meaning given to such term in
Section 3.1(a) hereof.
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ARTICLE II
DECLARATION OF TRUST; APPOINTMENT OF TRUSTEES; GRANT TO TRUST
AND NATURE OF TRANSFER
2.1 Declaration of Trust. It is the intention of the parties hereto
that the Trust continued hereby constitute a statutory trust under the Delaware
Act, and that this Agreement constitute the governing instrument of the Trust.
The name of the Trust is ▇▇▇▇▇ Liquidating Trust.
2.2 Appointment of Trustees. The Company hereby appoints and
constitutes ▇▇▇▇▇, ▇▇▇▇▇ and ▇▇▇▇▇▇▇ as Sponsor Trustees, and the Trust Company
as Delaware Trustee, and each Person so appointed hereby accepts such
appointment.
2.3 Grant. The Company hereby assigns, transfers, and sets over to
the Trust all of the Company's right, title and interest in, to and under, all
of the Company's assets, including, without limitation, its unsold properties,
interests in its Subsidiaries, accounts receivable, cash, securities, claims,
causes of action, contingent claims and reserves (all of the foregoing assets,
the "Retained Assets"), for the uses and purposes stated herein, subject to the
terms and provisions set out below, and the Sponsor Trustees hereby accept such
Retained Assets on behalf of the Trust, subject to the following terms and
provisions. The Sponsor Trustees hereby acknowledge receipt of the Retained
Assets on behalf of the Trust from the Company, which Retained Assets shall
constitute the initial Trust Assets. The Trust Assets shall be held in trust for
the Beneficiaries of the Trust. As directed by the Sponsor Trustees, the Trust
may take title to the Retained Assets and other Trust Assets (including proceeds
therefrom) directly in the name of the Trust or in the name of one or more of
the Sponsor Trustees on behalf of the Trust.
2.4 Purpose of Trust.
(a) The Trust was formed and is hereby continued for the
sole purpose of winding up the Company's affairs and the liquidation of the
Retained Assets with no objective to continue or engage in the conduct of a
trade or business or cause any Subsidiary to continue or engage in the conduct
of a trade or business, except as necessary for the orderly liquidation of the
Trust Assets.
(b) It is expected that the Company shall liquidate and
dissolve prior to fully winding up its affairs, including, but not limited to,
the sale of its remaining properties, the collection of its receivables and the
payment of any unsatisfied Liabilities of the Company.
(c) The Retained Assets granted, assigned and conveyed to
the Trust shall be held in the Trust, and the Trust will (i) further liquidate
the Trust Assets to carry out the purpose of the Trust and facilitate
distribution of the Trust Assets, (ii) allocate, protect, conserve and manage
the Trust Assets in accordance with the terms and conditions hereof, (iii)
complete the winding up of the Company's affairs, (iv) act on behalf of the
Beneficiaries, and (v) distribute the Trust Assets in accordance with the terms
and conditions hereof.
(d) It is intended that the granting, assignment and
conveyance of the Retained Assets by the Company to the Trust pursuant to the
terms hereof shall be treated for Federal and state income tax purposes as if
the Company made such distributions directly to the Stockholders. It is further
intended that for Federal, state and local income tax purposes the Trust shall
5
be treated as a liquidating trust under Treasury Regulation Section
301.7701-4(d) and any analogous provision of state or local law, and the
Beneficiaries shall be treated as the owners of their respective shares of the
Trust pursuant to Sections 671 through 679 of the Internal Revenue Code of 1986,
as amended (the "Code") and any analogous provision of state or local law, and
shall be taxed on their respective share of the Trust's taxable income
(including both ordinary income and capital gains) pursuant to Section 671 of
the Code and any analogous provision of state or local law. The Trust shall file
all tax returns required to be filed with any governmental agency consistent
with this position, including, but not limited to, any returns required of
grantor trusts pursuant to Section 1.671-4(a) of the Treasury Regulations.
2.5 No Reversion to the Company. In no event shall any part of the
Trust Assets revert to or be distributed to the Company.
2.6 Instruments of Further Assurance. Prior to the dissolution of
the Company, such Persons as shall have the right and power to so act, will,
upon reasonable request of any Sponsor Trustee, execute, acknowledge, and
deliver such further instruments and do such further acts as may be necessary or
proper to carry out effectively the purposes of this Agreement, to confirm or
effectuate the transfer to the Trust of any property intended to be covered
hereby, and to vest in the Trust or, in accordance with the last sentence of
Section 2.3 of this Agreement, the Sponsor Trustees on behalf of the Trust and
their successors and assigns, the estate, powers, instruments or funds in trust
hereunder.
2.7 Subsidiaries.
(a) Subject to the terms of any agreements governing the
management and operation of any Subsidiary, including without limitation with
respect to obligations of the directors, officers, managers, partners or members
of any Subsidiary to act in the best interests of the Subsidiary and the equity
holders, partners or members of such Subsidiary, the Sponsor Trustees shall act
with respect to the Trust's interest in each Subsidiary (whether in connection
with the Trust's position as equity owner, partner, member or manager, or as a
director, officer, employee or agent of such Subsidiary), and shall, subject to
any obligations to any other equity owners, partners or members of a Subsidiary,
cause each Subsidiary to act, consistent with the purposes and provisions of the
Trust and this Agreement.
(b) The Managing Trustee shall, to the extent not achieved
on or prior to the Transfer Date, and to the extent deemed necessary or
desirable by counsel to the Trust, (i) amend, or cause to be amended, the
operating agreements and other governing documents of each Subsidiary and take
such other action to provide that (A) the overriding purpose of such entity is
the same as that set forth in Section 2.4 of this Agreement, including no
objective to continue or engage in the conduct of a trade or business (other
than as necessary to preserve the value of its assets) and the expeditious but
orderly disposition and distribution of its assets, and (B) such Subsidiary
shall, to the extent permitted under applicable law, act on a basis that is
consistent with the purposes and provisions of the Trust and this Agreement, and
(ii) cause each Subsidiary to agree in writing (A) to the provisions of this
Section 2.7, and (B) whether or not its operating agreements and other governing
documents ultimately are amended, to act on a basis that is consistent with the
purposes and provisions of this Agreement.
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(c) The Sponsor Trustees shall cause each Subsidiary to
distribute to the Trust and to such Subsidiary's other equity owners, partners
or members, if any, in proportion to their interests therein, on or before each
annual distribution date provided for in Section 5.6 of this Agreement (or such
earlier time as required in order to be included in the distribution by the
Trust on the annual distribution date) all of its cash (less any amounts
required for payment of taxes and any other expenses or liabilities as may be
needed by such Subsidiary which amounts are not required to be paid to the
Trust).
(d) Subject to the provisions of this Section 2.7, the
Sponsor Trustees may serve as partners, members, directors, officers, employees
or agents of a Subsidiary.
2.8 Payment of Liabilities. The Trust hereby assumes all Liabilities
and agrees hereafter to pay, discharge and perform when due all of the
Liabilities. Should any Liability be asserted against any one or more of the
Trustees as the transferees of the Trust Assets or as a result of the assumption
made in this Section 2.8, the Sponsor Trustees may use such part of the Trust
Assets as may be necessary in contesting any such Liability or in payment
thereof, but in no event shall the Trustees, Beneficiaries or employees or
agents of the Trust be personally liable, nor shall resort be had to the private
property of such Persons, to satisfy the Liabilities.
2.9 Initial Beneficiaries. The Stockholders shall be the Initial
Beneficiaries of the Trust.
2.10 Notice to Unlocated Stockholders. If the Sponsor Trustees hold
Trust Assets for unlocated Stockholders, due notice shall be given to such
Stockholders in accordance with Delaware law.
ARTICLE III
BENEFICIARIES
3.1 Beneficial Interests.
(a) The Beneficial Interest of each Initial Beneficiary
shall be determined in accordance with a certified copy of the Company's
stockholder list as of the Record Date. Such list shall be prima facie evidence
of the identity of the Beneficiaries of the Trust. For ease of administration,
the Beneficial Interest of each Beneficiary shall be expressed in terms of units
("Units"). Each record owner of Shares as of the close of business on the Record
Date shall receive one Unit for each Share then held of record. Each record
owner of Shares shall have the same pro rata interest in the Trust Assets as
such holder's pro rata interest in the aggregate outstanding Shares on the
Record Date.
(b) On and after the Transfer Date, all outstanding Shares
shall automatically be deemed canceled. In addition, the Trust will not assume
any options under the Company's 1994 Stock Option Plan or 1995 Stock Option Plan
for Non-Employee Directors and all outstanding options under such plans that
have not been exercised prior to the Transfer Date shall automatically be deemed
canceled. The rights of Beneficiaries in, to and under the Trust Assets and the
Trust shall not be represented by any form of certificate or other instrument,
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and no Beneficiary shall be entitled to such a certificate. A record of the name
and address of each Beneficiary and such Beneficiary's aggregate Units in the
Trust shall be maintained by a registrar on behalf of the Trust or, if none, by
employees of the Trust.
(c) If any conflicting claims or demands are made or
asserted with respect to the ownership of any Units, or if there is any
disagreement between the transferees, assignees, heirs, representatives or
legatees succeeding to all or part of the interest of any Beneficiary resulting
in adverse claims or demands being made in connection with such Units, then, in
any of such events, the Sponsor Trustees shall be entitled, at their sole
election, to refuse to comply with any such conflicting claims or demands. In so
refusing, the Sponsor Trustees may elect to make no payment or distribution with
respect to such Units, or to make such payment to a court of competent
jurisdiction or an escrow agent, and in so doing, the Sponsor Trustees shall not
be or become liable to any of such parties for their failure or refusal to
comply with any of such conflicting claims or demands or to take any other
action with respect thereto, nor shall the Sponsor Trustees be liable for
interest on any funds which they may so withhold. Notwithstanding anything to
the contrary set forth in this Section 3.1(c), the Sponsor Trustees shall be
entitled to refrain and refuse to act until either (i) the rights of the adverse
claimants have been adjudicated by a final judgment of a court of competent
jurisdiction, (ii) all differences have been adjusted by valid written agreement
between all of such parties, and the Sponsor Trustees shall have been furnished
with an executed counterpart of such agreement, or (iii) there is furnished to
the Sponsor Trustees a surety bond or other security satisfactory to the Sponsor
Trustees, as they shall deem appropriate, to fully indemnify them as between all
conflicting claims or demands.
3.2 Beneficiaries are Parties. By acceptance of delivery of Units,
any Beneficiary from time to time of such Units shall be deemed to have agreed
to become a party to this Agreement and to be bound by all of the terms and
conditions hereof to the same extent as though such person executed this
Agreement.
3.3 Rights of Beneficiaries. Each Beneficiary shall be entitled to
participate in the rights and benefits due to a Beneficiary hereunder according
to the Beneficiary's Beneficial Interest. Each Beneficiary shall take and hold
the same subject to all the terms and provisions of this Agreement. The interest
of each Beneficiary hereunder is declared, and shall be in all respects,
personal property and upon the death of an individual Beneficiary, the
Beneficiary's Beneficial Interest shall pass as personal property to the
Beneficiary's legal representative and such death shall in no way terminate or
affect the validity of this Agreement. A Beneficiary shall have no title to,
right to, possession of, management of, or control of, the Trust Assets except
as expressly provided herein. No widower, widow, heir or devisee of any person
who may be a Beneficiary shall have any right of dower, curtesy, homestead, or
inheritance, or of partition, or of any other right, statutory or otherwise, in
any property forming a part of the Trust Assets, but the whole title to all the
Trust Assets shall be vested in the Trust or the Sponsor Trustees and the sole
interest of the Beneficiaries shall be the rights and benefits given to such
Persons under this Agreement.
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3.4 Limitations on Transfer of Interests of Beneficiaries.
(A) THE BENEFICIAL INTEREST OF A BENEFICIARY MAY NOT BE
TRANSFERRED; PROVIDED THAT THE BENEFICIAL INTERESTS SHALL BE ASSIGNABLE OR
TRANSFERABLE BY WILL, INTESTATE SUCCESSION, OR OPERATION OF LAW AND THAT THE
EXECUTOR OR ADMINISTRATOR OF THE ESTATE OF A BENEFICIARY MAY MORTGAGE, PLEDGE,
GRANT A SECURITY INTEREST IN, HYPOTHECATE OR OTHERWISE ENCUMBER, THE BENEFICIAL
INTEREST HELD BY THE ESTATE OF SUCH BENEFICIARY IF NECESSARY IN ORDER TO BORROW
MONEY TO PAY ESTATE, SUCCESSION OR INHERITANCE TAXES OR THE EXPENSES OF
ADMINISTERING THE ESTATE OF THE BENEFICIARY, UPON WRITTEN NOTICE TO, AND WRITTEN
CONSENT OF, THE TRUST, WHICH CONSENT MAY NOT BE UNREASONABLY WITHHELD. IN THE
EVENT A BENEFICIARY TRANSFERS ANY BENEFICIAL INTEREST IN VIOLATION OF ANY OF THE
PROVISIONS OF THIS AGREEMENT, SUCH TRANSFER SHALL BE VOID.
(b) Except as may be otherwise required by law, the
Beneficial Interests of the Beneficiaries hereunder shall not be subject to
attachment, execution, sequestration or any order of a court, nor shall such
interests be subject to the contracts, debts, obligations, engagements or
liabilities of any Beneficiary, but the interest of a Beneficiary shall be paid
by the Trust to the Beneficiary free and clear of all assignments, attachments,
anticipations, levies, executions, decrees and sequestrations and shall become
the property of the Beneficiary only when actually received by such Beneficiary.
3.5 Trustees as Beneficiary. Any Trustee may be a Beneficiary to the
same extent as if such Person were not a Trustee hereunder and have all the
rights of a Beneficiary, including, without limitation, the right to vote and to
receive distributions, to the same extent as if such Person were not a Trustee
hereunder.
ARTICLE IV
DURATION AND TERMINATION OF THE TRUST
4.1 Duration. The existence of the Trust shall terminate upon the
earliest of (i) the distribution of all the Trust Assets as provided in Section
5.7 of this Agreement, or (ii) the expiration of a period of three years from
the Transfer Date; provided that the Sponsor Trustees, in their discretion, may
extend the existence of the Trust to such later date as they may designate, if
they determine that an extension is reasonably necessary to fulfill the purpose
of the Trust, as specified in this Agreement, and, prior to such extension, the
Sponsor Trustees shall have requested and received both (a) additional no-action
assurances from the Securities and Exchange Commission regarding the
registration and reporting requirements of the Trust under the Securities Act of
1933, as amended, the Securities Exchange Act of 1934, as amended, and any other
applicable Federal securities act, and (b) an opinion of tax counsel that such
extension will not jeopardize the status of the Trust as a "liquidating trust"
for federal income tax purposes within the meaning of Treasury Regulation
Section 301.7701-4(d). The Trust shall not in any event terminate pursuant to
subparagraph (ii) of this Section 4.1 prior to the date on which the Sponsor
Trustees are permitted to make a final distribution in accordance with Section
5.7 of this Agreement. The Sponsor Trustees shall wind up the affairs of the
9
Trust and shall provide the Delaware Trustee written confirmation of the
dissolution and the completion of winding up of the Trust and shall authorize
and direct the Delaware Trustee to execute and file in the office of the
Secretary of State a certificate of cancellation in accordance with the Delaware
Act. The Delaware Trustee is hereby authorized and empowered to execute and file
such certificate of cancellation, and upon such certificate of cancellation
becoming effective the Trust shall terminate.
4.2 Other Obligations of Trustees upon Termination. Upon termination
of the Trust, the Sponsor Trustees shall provide for the retention of the books,
records, lists of holders of Units, certificates for Shares and files which
shall have been delivered to or created by the Sponsor Trustees. At the
discretion of the Sponsor Trustees, all of such records and documents may be
destroyed at any time permitted by applicable law after the distribution of all
the Trust Assets. Except as otherwise specifically provided in this Agreement,
upon the distribution of all the Trust Assets, no Trustee shall have any further
duties or obligations hereunder.
ARTICLE V
ADMINISTRATION OF TRUST ASSETS
5.1 Sale of Trust Assets. Subject to the terms and conditions of
this Agreement, the Sponsor Trustees may, at such times as the Sponsor Trustees
deem appropriate, collect, liquidate, reduce to cash, transfer, assign, or
otherwise dispose of all or any part of the Trust Assets as they deem
appropriate at public auction or at private sale for cash, securities or other
property, or upon credit (either secured or unsecured as the Sponsor Trustees
shall determine).
5.2 Efforts to Resolve Claims and Liabilities. Subject to the terms
and conditions of this Agreement, the Sponsor Trustees will make appropriate
efforts to resolve any contingent or unliquidated claims and outstanding
contingent Liabilities for which the Trust may be responsible, dispose of the
Trust Assets, make timely distributions and not unduly prolong the duration of
the Trust.
5.3 Continued Collection of Property of Trust Assets. All property
that is determined to be a part of the Trust Assets shall continue to be
collected and held as a part of the Trust. The Trust or the Sponsor Trustees
shall hold the Trust Assets without being obligated to provide for or pay any
interest thereon to any Beneficiary, except to the extent of such Beneficiary's
share of interest actually earned by the Trust after payment of the Trust's
liabilities and expenses as provided in Section 5.5 of this Agreement.
5.4 Restriction on Trust Assets. Other than the membership interests
in the Subsidiaries, the Trust shall not acquire or receive, or cause any
Subsidiary to acquire or receive any assets prohibited by IRS Revenue Procedure
82-58, 1982-2 C.B. 847, as the same may be amended, supplemented, or modified,
including, but not limited to, any listed stocks or securities, any readily-
marketable assets, any operating assets of a going business, any unlisted stock
of a single issuer that represents 80% or more of the stock of such issuer, any
general or limited partnership interest or any limited liability company or
business trust interest. The Trust shall not retain cash in excess of a
reasonable amount to meet expenses, charges and obligations of the Trust, the
Trust Assets and all Liabilities.
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5.5 Payment of Expenses and Liabilities. The Trust shall pay from
the Trust Assets all expenses, charges, and obligations of the Trust and of the
Trust Assets and all Liabilities, all other obligations which the Sponsor
Trustees cause the Trust to specifically assume and agree to pay pursuant to
this Agreement and such transferee liabilities which the Trust may be obligated
to pay as transferee of the Trust Assets, including, but not limited to,
interest, penalties, taxes, assessments, and public charges of any kind or
nature and the costs, charges, and expenses connected with or growing out of the
execution or administration of the Trust and such other payments and
disbursements as are provided in this Agreement or which may be determined to be
a proper charge against the Trust Assets by the Sponsor Trustees.
5.6 Interim Distributions. At such time as may be determined by them
in their sole discretion, the Sponsor Trustees shall distribute, or cause to be
distributed to the Beneficiaries, in proportion to the number of Units held by
each Beneficiary on the record date for such distribution as determined by the
Sponsor Trustees in their sole discretion, such cash or other property
comprising a portion of the Trust Assets as the Sponsor Trustees may in their
sole discretion determine may be distributed without detriment to the
conservation and protection of the Trust Assets; provided, however, that the
Sponsor Trustees shall distribute, or cause to be distributed, at least annually
to the Beneficiaries any cash proceeds from the sale of the Trust Assets in
excess of a reasonable amount (as determined by the Sponsor Trustees) to satisfy
the Liabilities and expenses described in Section 5.5 of this Agreement.
5.7 Final Distribution. If the Sponsor Trustees determine that the
Liabilities and all other claims, expenses, charges, and obligations of the
Trust have been paid or discharged or if the Trust shall dissolve pursuant to
Section 4.1 of this Agreement, the Sponsor Trustees shall, as expeditiously as
is consistent with the conservation and protection of the Trust Assets,
distribute the remaining Trust Assets, if any, to the Beneficiaries in
proportion to the number of Units held by each Beneficiary; provided, however,
that the Sponsor Trustees shall hold back from such distribution the sum One
Hundred Thousand Dollars ($100,000.00) (the "Holdback"). The Sponsor Trustees
shall deposit the Holdback in escrow in a deposit account maintained with the
Trust Company or such affiliate of the Trust Company as the Trust Company may
designate (such entity, the "Holdback Depository"). The Holdback Depository
shall maintain the Holdback for a period of one (1) year after the earlier of
(i) any resignation of the Delaware Trustee, or (ii) the date of deposit in
escrow, during which time the Holdback Depository may disburse any funds from
the Holdback in satisfaction of the Trust's obligation to indemnify, defend and
hold harmless DT Covered Persons for DT Expenses pursuant to Section 10.7 of
this Agreement. At the conclusion of such one (1) year period, the Holdback
Depository shall remit any remaining Holdback funds (less and except any funds
which the Delaware Trustee in good faith determines to hold back in deference to
pending or threatened DT Expenses, any remainder of which funds shall be
remitted as provided in this sentence upon the final, non-appealable conclusion
of such pending or threatened DT Expenses and the matters giving rise thereto)
to the Trust or, if a certificate of cancellation for the Trust has been filed
pursuant to Section 4.1 of this Agreement, to such Persons as may be designated
in a written direction from the Managing Trustee to the Delaware Trustee and the
Holdback Depository at the time the certificate of cancellation is filed. If
remaining Holdback funds are remitted to the Trust, the Sponsor Trustees shall
distribute such funds to such Beneficiaries and in such amounts as are
proportionate to the amounts held back from the distributions made to such
Beneficiaries pursuant to the first sentence of this Section 5.7. The Sponsor
Trustees shall hold in the Trust and thereafter make disposition of all
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liquidating distributions and other payments due any Beneficiaries who have not
been located, in accordance with Delaware law, subject to applicable state laws
regarding escheat and abandoned property. This Section 5.7 shall survive the
termination of this Agreement and the resignation or removal of the Delaware
Trustee.
5.8 Reports to Beneficiaries and Others.
(a) As soon as practicable after the Transfer Date, the
Trust will mail to each Beneficiary a notice indicating how many Units such
person owns and the contact details of the Sponsor Trustees. As soon as
practicable after the end of each tax year during the term of the Trust and once
after termination of the Trust, the Sponsor Trustees shall submit a written
report and account to the Beneficiaries showing (i) the assets and liabilities
of the Trust at the end of such taxable year or upon dissolution and the
receipts and disbursements of the Sponsor Trustees for such taxable year or
period, (ii) any changes in the Trust Assets and Liabilities that they have not
previously reported, (iii) the compensation paid or payable to the Trustees, and
(iv) any action taken by the Sponsor Trustees in the performance of their duties
under this Agreement that they have not previously reported, and which, in their
opinion, materially affects the Trust Assets or Liabilities.
(b) The tax year of the Trust shall end on December 31 of
each year unless the Sponsor Trustees deem it advisable to establish some other
date as the date on which the tax year of the Trust shall end.
(c) During the course of a tax year, whenever a material
event relating to the Trust's Assets occurs, the Trust shall, within a
reasonable period of time after such occurrence, prepare and make available to
the Beneficiaries an interim report describing such event. The occurrence of a
material event need not be reported on an interim report if an annual report
pursuant to Section 5.8(a) of this Agreement will be issued within a reasonable
period of time after such interim report would be issued and such annual report
describes the material event as it would be discussed in an interim report. The
occurrence of a material event will be determined solely by the Sponsor Trustees
or as may be required by any applicable rules and regulations promulgated by the
Securities and Exchange Commission.
5.9 Federal Income Tax Information. As soon as practicable after the
close of each tax year of the Trust, the Trust shall mail to each Person who was
a Beneficiary at the close of the year, a statement showing, on a Unit basis the
dates and amount of all distributions made by the Sponsor Trustees, income
earned on assets held by the Trust, if any, such other information as is
reasonably available to the Sponsor Trustees which may be helpful in determining
the amount of gross income and expenses attributable to the Trust that such
Beneficiary should include in such Person's Federal income tax return for the
preceding year and any other information as may be required to be furnished
under applicable law. In addition, after receipt of a request in good faith, the
Trust shall furnish to any Person who has been a Beneficiary at any time during
the preceding year, at the expense of such Person and at no cost to the Trust, a
statement containing such further information as is reasonably available to the
Sponsor Trustees which shall be helpful in determining the amount of taxable
income which such Person should include in such Person's Federal income tax
return.
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5.10 Books and Records. The Sponsor Trustees shall maintain in
respect of the Trust and the holders of Units books and records relating to the
Trust Assets, income and liabilities of the Trust in such detail and for such
period of time as may be necessary to enable them to make full and proper
accounting in respect thereof in accordance with this Article V and to comply
with applicable law. Such books and records shall be maintained on a basis or
bases of accounting necessary to facilitate compliance with the tax reporting
requirements of the Trust and the reporting obligations of the Sponsor Trustees
under Section 5.8 of this Agreement. Nothing in this Agreement requires the
Sponsor Trustees to file any accounting or seek approval of any court with
respect to the administration of the Trust or as a condition for managing any
payment or distribution out of the Trust Assets. Beneficiaries shall have the
right upon 30 days' prior written notice delivered to the Trust to inspect
during normal business hours such books and records (including financial
statements); provided that, if so requested, such Beneficiaries shall have
entered into a confidentiality agreement satisfactory in form and substance to
the Sponsor Trustees.
ARTICLE VI
POWERS OF AND LIMITATIONS ON THE SPONSOR TRUSTEES
6.1 Limitations on Sponsor Trustees. The Sponsor Trustees shall not
at any time, on behalf of the Trust or Beneficiaries, or cause any Subsidiary
to, enter into or engage in any trade or business except as necessary for the
orderly liquidation of the Trust Assets. The Sponsor Trustees shall be
restricted to the holding, collection and sale of the Trust Assets and the
payment and distribution thereof for the purposes set forth in this Agreement
and to the conservation and protection of the Trust Assets and the
administration thereof in accordance with the provisions of this Agreement. In
no event shall the Sponsor Trustees take any action, directly or through any
Affiliate of the Trust or any Sponsor Trustee, to facilitate or encourage any
trading in the Beneficial Interests or in any instrument tied to the value of
the Beneficial Interests.
6.2 Specific Powers of the Sponsor Trustees. The Sponsor Trustees
shall be responsible for the general policies of the Trust. Subject to the
provisions of this Agreement, the Sponsor Trustees shall have full power and
authority, and are hereby authorized and empowered, in addition to any powers
conferred upon them by any other Section or provision of this Agreement or any
statutory laws of the State of Delaware, in the name and on behalf of the Trust,
to do or cause to be done the following specific things without the need for
further action on the part of the Trust; (provided that the enumeration of the
following powers shall not be considered in any way to limit or control the
power of the Sponsor Trustees to act as specifically authorized by any other
Section or provision of this Agreement and to act in such a manner as the
Sponsor Trustees may deem necessary or appropriate to conserve and protect the
Trust Assets or to confer on the Beneficiaries the benefits intended to be
conferred upon them by this Agreement):
(a) to determine the nature and amount of the consideration
to be received with respect to the sale or other disposition of, or the grant of
interest in, the Trust Assets;
(b) to collect, liquidate or otherwise convert into cash, or
such other property as they deem appropriate, all property, assets and rights in
the Trust Assets, and to pay, discharge, and satisfy all other claims, expenses,
13
charges, Liabilities and obligations existing with respect to the Trust Assets,
the Trust or the Trustees;
(c) to elect, appoint, engage, retain or employ any Persons
as agents, representatives, employees, or independent contractors (including
without limitation real estate advisors, investment advisors, accountants,
transfer agents, attorneys-at-law, managers, appraisers, brokers, or otherwise)
in one or more capacities, and to pay reasonable compensation from the Trust
Assets for services in as many capacities as such Person may be so elected,
appointed, engaged, retained or employed, to prescribe the titles, powers and
duties, terms of service and other terms and conditions of the election,
appointment, engagement, retention or employment of such Persons and, except as
prohibited by law, to delegate any of the powers and duties of the Sponsor
Trustees to agents, representatives, employers, independent contractors or other
Persons;
(d) to retain and set aside such funds out of the Trust
Assets as the Sponsor Trustees shall deem necessary or expedient to pay, or
provide for the payment of (i) unpaid claims, expenses, charges, Liabilities and
obligations of the Trust, the Company or any Subsidiary; and (ii) the expenses
of administering the Trust Assets;
(e) to do and perform any and all acts necessary or
appropriate for the conservation and protection of the Trust Assets, including
acts or things necessary or appropriate to maintain the Trust Assets held by the
Trust pending sale or disposition thereof or distribution thereof to the
Beneficiaries;
(f) to cause the Trust to borrow money and to place liens on
Trust Assets as security for such borrowing;
(g) to institute or defend actions or judgments for
declaratory relief or other actions or judgments and to take such other action,
in the name of the Trust or as otherwise required, as the Sponsor Trustees may
deem necessary or desirable to enforce any leases, instruments, contracts,
agreements, causes of action, or rights relating to or forming a part of the
Trust Assets;
(h) to determine conclusively from time to time the value of
and to revalue the property of the Trust, in accordance with independent
appraisals or other information as the Sponsor Trustees deem necessary or
appropriate;
(i) to cancel, terminate, or amend any leases, instruments,
contracts, agreements, obligations, or causes of action relating to or forming a
part of the Trust Assets, and to execute new leases, instruments, contracts,
agreements, or obligations or pursue new causes of action notwithstanding that
the terms of any such leases, instruments, contracts, agreements, obligations,
or causes of action may extend beyond the term of the Trust;
(j) to cause any investments of any part of the Trust Assets
to be registered and held in the Trust's name or in the names of one or more
Sponsor Trustees or a nominee or nominees without increase or decrease of
liability with respect thereto;
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(k) to vote by proxy or otherwise on behalf of the
Beneficiaries and the Trust and with full power of substitution all shares of
stock and all securities held as Trust Assets hereunder and to exercise every
power, election, discretion, option and subscription right and give every
notice, make every demand, and to do every act or thing in respect of any shares
of stock or any securities held by the Trust or one or more Sponsor Trustees as
Trust Assets;
(l) to undertake or join in, approve and/or disapprove any
merger, plan of reorganization, consolidation, liquidation, dissolution,
readjustment or other transaction of any entity, any of whose shares of stock or
other securities, obligations, or properties may at any time constitute a part
of the Trust Assets and to accept the substituted shares of stock, bonds,
securities, obligations and properties and to hold the same in trust in
accordance with the provisions hereof;
(m) to authorize transactions between other entities whose
securities, or other interests therein (either in the nature of debt or equity),
are held by the Trust or one or more Sponsor Trustees as part of the Trust
Assets;
(n) in connection with the sale or other disposition or
distribution of any securities held by the Trust, to comply with applicable
Federal and state securities laws, and to enter into agreements relating to the
sale or other disposition or distribution thereof;
(o) to terminate and dissolve any entities owned by the
Trust;
(p) to direct the administrator of the Company's 401(k) plan
in accordance with the terms and conditions of such plan, to the extent
necessary; and (q) to perform any act authorized, permitted, or required under
any lease, instrument, contract, agreement, right, obligation, or cause of
action relating to or forming a part of the Trust Assets whether in the nature
of an approval, consent, demand, or notice thereunder or otherwise, but if such
act would require the consent of the Beneficiaries in accordance with the
express provisions of this Agreement, then only if the Required Consent of the
Beneficiaries has been given (or such greater consent as is expressly required
by any other provision of this Agreement).
6.3 Actions by Managing Trustee. Except as expressly provided in
this Agreement or as required by law, so long as there is a Managing Trustee,
the Managing Trustee may take any action and execute or sign and deliver any
document on behalf of the Trust without the approval of a majority of the
Sponsor Trustees.
6.4 Extraordinary Actions by Sponsor Trustees. Notwithstanding
anything to the contrary in this Agreement, the Sponsor Trustees shall not
undertake any of the following unless authorized by the approval, consent, vote
or resolution of a majority of the Sponsor Trustees:
(a) Any action with respect to the distribution of the Trust
Assets;
(b) Any action with respect to the disposition of the Trust
Assets; provided however, that in the absence of any conflict of interest on the
part of a Sponsor Trustee, such Sponsor Trustee, acting alone, may sell or
otherwise dispose of any Trust Assets in a privately negotiated transaction or
15
series of related transactions, provided that the aggregate consideration
received in connection with such transaction or series of related transactions
does not exceed $2.5 million.
(c) The prepayment, incurrence or refinancing of any debt of
the Trust for borrowed money in a single transaction or series of related
transactions in excess of $2.5 million.
(d) The settlement or compromise of any action, suit or
proceeding or any other contingent Liability not incurred in the ordinary course
of business or not covered by insurance.
(e) The entering into any contract or other arrangement with
a Sponsor Trustee or an Affiliate of a Sponsor Trustee.
(f) The conversion, merger, or consolidation of the Trust
with or into another Person.
(g) The amendment of this Agreement.
(h) Any other action that a majority of the Sponsor Trustees
request by vote or resolution be undertaken only with the approval, consent,
vote or resolution of a majority of Sponsor Trustees, unless and until a
resolution of a majority of the Sponsor Trustees provides that such approval,
consent, vote or resolution is no longer required to undertake such action.
ARTICLE VII
LIMITATION OF LIABILITY CONCERNING THE SPONSOR TRUSTEES,
BENEFICIARIES, EMPLOYEES AND AGENTS
7.1 Generally. The Sponsor Trustees accept and undertake to
discharge the trust created by this Agreement, upon the terms and conditions
hereof, on behalf of the Beneficiaries. The Sponsor Trustees shall exercise the
rights and powers vested in them by this Agreement in accordance with applicable
law. No Sponsor Trustee, employee or agent of the Trust shall be liable to the
Trust or any Beneficiary except for such Person's own grossly negligent action,
their own grossly negligent failure to act, or their own fraud or willful
misconduct knowingly and intentionally committed in bad faith. Without limiting
the foregoing:
(a) no Sponsor Trustee shall be responsible for the acts or
omissions of the other Sponsor Trustees;
(b) no Sponsor Trustee shall be liable to the Beneficiaries
for the acts or omissions of an agent, employee, advisor or manager of the Trust
appointed by the Sponsor Trustee hereunder, except where such Sponsor Trustee
specifically directs the act of such Person, delegates the authority to such
Person to act where such Sponsor Trustee was under a duty not to delegate, or
does not use reasonable prudence in the selection or retention of such Person;
(c) no Sponsor Trustee shall be liable except for the
performance of such duties and obligations as are specifically set forth in this
Agreement, no implied covenants or obligations shall be read into this Agreement
16
against such Sponsor Trustee and the right of a Sponsor Trustee to perform any
discretionary act enumerated herein shall not be construed as a duty;
(d) no Sponsor Trustee shall be liable for any reasonable
error of judgment made in good faith;
(e) no provision of this Agreement shall require any Sponsor
Trustee to expend or risk such Person's personal funds or otherwise incur any
financial liability in the exercise of such Person's rights or powers under this
Agreement;
(f) no Sponsor Trustee shall be liable with respect to any
action taken or omitted to be taken by such Sponsor Trustee in good faith in
accordance with the terms and conditions of this Agreement relating to the time,
method and place of conducting any proceeding for any remedy available to the
Sponsor Trustee or exercising any right or power conferred upon the Sponsor
Trustee under this Agreement; and
(g) no Sponsor Trustee shall have liability for any action
or inaction if such action or inaction on the part of the Sponsor Trustee, had
such Person been acting in the capacity as a director of a Michigan corporation,
would be entitled to the protection of the business judgment rule under Michigan
law or would be relieved from liability under the Company's Articles of
Incorporation as in effect on August 26, 2004.
7.2 Reliance by Sponsor Trustee. No Sponsor Trustees shall incur
liability to anyone in acting upon any signature, instrument, notice,
resolution, request, consent, order, certificate, report, opinion, bond or other
document or paper believed by it to be genuine and believed by it to be signed
by the proper party or parties. Any Sponsor Trustee may accept a certified copy
of a resolution of the board of directors or other governing body of any Person
as conclusive evidence that such resolution has been duly adopted by such body
and that the same is in full force and effect. As to any fact or matter, a
Sponsor Trustees may for all purposes hereof rely on a certificate, signed by
any director, the president, any vice president, the treasurer, any assistant
treasurer, the secretary, any assistant secretary or any other officer or
representative of the relevant party, and such certificate shall constitute full
protection to the Sponsor Trustee for any action taken or omitted to be taken by
it in good faith in reliance thereon.
7.3 Agents, Counsel, Etc. In the exercise or administration of the
trusts hereunder, the Sponsor Trustees (i) may act directly or, at the expense
of the Trust, through agents or attorneys, and the Sponsor Trustees shall not be
liable for the default or misconduct of such agents or attorneys selected and
retained by it in good faith; and (ii) may, at the expense of the Trust, consult
with counsel, accountants and other skilled Persons, and no Sponsor Trustee
shall be liable for anything done, suffered or omitted in good faith by it in
accordance with the advice or opinion of any such counsel, accountants, or other
skilled Persons selected by it in good faith.
7.4 Limitation on Liability to Third Persons. No Beneficiary
(including but not limited to Kross in exercising or not exercising any right
under Article VIII or any other provision of this Agreement), Sponsor Trustee,
employee or agent of the Trust shall be subject to any personal liability
whatsoever in tort, contract, or otherwise, to any Person in connection with the
Trust Assets or the affairs of the Trust. All such other Persons shall look
solely to the Trust Assets for satisfaction of claims of any nature arising in
17
connection with the affairs of the Trust. The Sponsor Trustees shall, at all
times, at the expense of the Trust, maintain insurance for the protection of the
Trust Assets and in such amount as the Sponsor Trustees shall deem commercially
reasonable and to the extent available at reasonable rates.
7.5 Recitals. Any written instrument creating an obligation of the
Trust shall be conclusively taken to have been executed or done by a Sponsor
Trustee, employee or agent of the Trust only in its capacity as Sponsor Trustee
under this Agreement, or in its capacity as an employee or agent of the Trust.
7.6 Indemnification. Each Sponsor Trustee (each an "Indemnified
Person" and collectively the "Indemnified Persons"), shall be indemnified out of
the Trust Assets against all liabilities and expenses, including amounts paid in
satisfaction of judgments, in compromise or as fines and penalties, and counsel
fees, reasonably incurred by the Indemnified Persons in connection with the
defense or disposition of any action, suit or other proceeding by the Trust or
any other Person, whether civil or criminal, in which the Indemnified Person may
be involved or with which the Indemnified Person may be threatened: (i) while in
office or thereafter, by reason of his being or having been such a Sponsor
Trustee, including, without limitation, in connection with or arising out of any
action, suit or other proceeding based on any alleged breach of duty, neglect,
error, misstatement, misleading statement, omission or act of any such Sponsor
Trustee in such capacity; and (ii) by reason of any such Person exercising or
failing to exercise any right or power hereunder; provided that the Indemnified
Person shall not be entitled to such indemnification with respect to any matter
as to which the Indemnified Person shall have been adjudicated to have acted
with gross negligence, fraud or willful misconduct knowingly and intentionally
committed in bad faith. The rights accruing to any Indemnified Person under
these provisions shall not exclude any other right to which the Indemnified
Person may be lawfully entitled; provided that no Indemnified Person may satisfy
any right of indemnity or reimbursement granted herein, or to which the
Indemnified Person may be otherwise entitled, except out of the Trust Assets or
proceeds of any insurance policy, and no Beneficiary shall be personally liable
to any person with respect to any claim for indemnity or reimbursement or
otherwise. The Trust may make advance payments in connection with
indemnification under this Section 7.6, provided that the Indemnified Person
shall have given a written undertaking to repay any amount advanced to the
Indemnified Person and to reimburse the Trust in the event that it is
subsequently determined that the Indemnified Person is not entitled to such
indemnification. The Sponsor Trustees may purchase such insurance as they
believe, in the exercise of their discretion, adequately insures that each
Indemnified Person shall be indemnified against any such loss, liability, or
damage pursuant to this Section 7.6. Nothing contained herein shall restrict the
right of the Trust to indemnify or reimburse an Indemnified Person or any
officer, employee or agent of the Trust in any proper case, even though not
specifically provided for herein, nor shall anything contained herein restrict
the right of any such Person to contribution under applicable law.
7.7 No Duty Not to Compete. No Sponsor Trustee shall be required to
administer the Trust as such Person's sole and exclusive function and such
Trustee may have other business interests and may engage in other activities
similar or in addition to those relating to the Trust, subject to such Trustee's
obligations under this Agreement and applicable law. Subject to applicable law,
the Sponsor Trustees, in their individual capacity, or through Persons that they
18
control or in which they have an interest, may directly or indirectly engage in
or possess any interest in any business venture, including, but not limited to,
the ownership, financing, management of or the investment in or operation of
real estate, or the provision of any services in connection with such
activities, whether or not such activities are similar to or in competition with
the business activities described in Section 6.1 of this Agreement. No Trustee
has any duty to present any business opportunity to the Trust before taking
advantage of such opportunity either in such Trustee's individual capacity or
through participation in any Person.
7.8 Fiduciary Duties. To the extent that provisions of this
Agreement restrict the duties and liabilities of the Sponsor Trustees otherwise
existing at law or in equity, such provisions are agreed by the parties hereto
and Persons bound hereby to replace such other duties and liabilities of the
Sponsor Trustees.
ARTICLE VIII
SPONSOR TRUSTEES AND SUCCESSOR SPONSOR TRUSTEES
8.1 Number and Qualification of Sponsor Trustees. The number of
Sponsor Trustees of the Trust initially shall be three and thereafter the number
of Sponsor Trustees shall be fixed from time to time by a written instrument
signed by a majority of the Sponsor Trustees which may increase or decrease the
number of Sponsor Trustees of the Trust; provided, however, that there shall at
all times be at least one Sponsor Trustee of the Trust.
8.2 Resignation and Removal of Sponsor Trustees. Any Sponsor Trustee
may resign and be discharged from the Trust hereby created by giving written
notice to the other Sponsor Trustees (or if there are no remaining Sponsor
Trustees, to Kross). Such resignation shall become effective on the date
specified in such notice, which date shall be at least 60 days after the date of
such notice, or upon the appointment of such Sponsor Trustee's successor, and
such successor's acceptance of such appointment, whichever is earlier. Any
Sponsor Trustee may be removed at any time, with or without cause, by
Beneficiaries having aggregate Units of at least a majority of the total Units
held by all Beneficiaries.
8.3 Appointment of Successor Sponsor Trustee. Should at any time a
Sponsor Trustee resign or be removed, or be adjudged bankrupt or insolvent, a
vacancy shall be deemed to exist and a successor shall be appointed by a
majority of the remaining Sponsor Trustees, unless the Beneficiaries (i) shall
have removed a Sponsor Trustee, and (ii) shall have elected a successor Sponsor
Trustee by a plurality vote. In the event there are not any existing Sponsor
Trustees, Kross shall appoint the successor Sponsor Trustee. In the event that
there are not any existing Sponsor Trustees and Kross fails to appoint a
successor Sponsor Trustee within 30 days of the resignation, removal, bankruptcy
or insolvency of such Sponsor Trustee, the successor Sponsor Trustee shall be
appointed by the Required Consent of the Beneficiaries. Furthermore, in the
event that a successor Sponsor Trustee is not appointed within 60 days of the
resignation, removal, bankruptcy or insolvency of such Sponsor Trustee, the
successor Sponsor Trustee shall be appointed by a court of competent
jurisdiction upon application of any Beneficiary or known creditor of the Trust.
8.4 Acceptance of Appointment by Successor Sponsor Trustee. Any
successor Sponsor Trustee appointed hereunder shall execute an instrument
accepting such appointment hereunder and shall deliver one counterpart, in case
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of a resignation, to the retiring Sponsor Trustee. Thereupon such successor
Sponsor Trustee shall, without any further act, become vested with all the
estates, properties, rights, powers, trusts, and duties of its predecessor in
the Trust hereunder with like effect as if originally named therein; but the
retiring Sponsor Trustee shall nevertheless, when requested in writing by the
successor Sponsor Trustee, execute and deliver an instrument or instruments
conveying and transferring to such successor Sponsor Trustee upon the trust
herein expressed, all the estates, properties, rights, powers, and trusts of
such retiring Sponsor Trustee and shall duly assign, transfer, and deliver to
such successor Sponsor Trustee all property and money of the Trust held by such
Sponsor Trustee hereunder.
8.5 Managing Trustee. ▇▇▇▇▇ is hereby appointed as Managing Trustee
and in such capacity shall have the authority to take action on behalf of the
Sponsor Trustees and the Trust to the extent set forth in Section 6.3 of this
Agreement. The Managing Trustee may resign from such position by giving written
notice to the other Sponsor Trustees (or if there are no remaining Sponsor
Trustees, to Kross). Such resignation shall become effective on the date
specified in such notice, which date shall be at least 60 days after the date of
such notice, or upon the appointment of a successor Managing Trustee, and such
successor's acceptance of such appointment, whichever is earlier. If there shall
be more than two Sponsor Trustees, a majority of the Sponsor Trustees other than
the Managing Trustee may remove the Managing Trustee at any time, with or
without cause, and appoint a successor Managing Trustee. If there are only two
Sponsor Trustees immediately before such removal occurs, there shall be no
Managing Trustee after such removal so long as there remain only two Sponsor
Trustees unless the remaining two Sponsor Trustees unanimously appoint one of
them as Managing Trustee. If there is no Managing Trustee, any action required
or permitted to be taken by the Managing Trustee under this Agreement shall be
taken by not less than a majority of the Sponsor Trustees.
8.6 Bonds. Unless required by the Board prior to the Transfer Date,
or unless a bond is required by law, no bond shall be required of any original
Trustee hereunder. Unless a bond is required by law and such requirement cannot
be waived by the Required Consent of the Beneficiaries, no bond shall be
required of any successor Trustee hereunder. If a bond is required by law, no
surety or security with respect to such bond shall be required unless required
by law and such requirement cannot be waived by the Required Consent of the
Beneficiaries or unless required by the Board. If a bond is required by the
Board or by law, the Board or the Sponsor Trustees, as the case may be, shall
determine whether, and to what extent, a surety or security with respect to such
bond shall be required. The cost of any such bond shall be borne by the Trust.
ARTICLE IX
COMPENSATION OF SPONSOR TRUSTEES
9.1 Amount of Compensation. In lieu of commissions or other
compensation fixed by law for trustees, each Sponsor Trustee who is not a full-
time employee of the Trust shall receive as compensation for services as Sponsor
Trustee hereunder the sum of $15,000 per year. Such compensation may be changed
with the approval of a majority of the Sponsor Trustees.
20
9.2 Expenses. Each Sponsor Trustee shall be reimbursed from the
Trust Assets for all expenses reasonably incurred, and appropriately documented,
by such Sponsor Trustee in the performance of that Sponsor Trustee's duties in
accordance with this Agreement.
ARTICLE X
THE DELAWARE TRUSTEE
10.1 Purpose; Power and Authority; Etc. The Delaware Trustee shall be
a trustee for the sole and limited purpose of fulfilling the requirements of ss.
3807 of the Delaware Act. The Delaware Trustee shall have the power and
authority to execute, deliver, acknowledge and file all necessary documents of
the Trust as required by the Delaware Act, and the Delaware Trustee's execution
and filing of the Certificate of Trust with the Secretary of State is hereby
ratified and affirmed. The Sponsor Trustees shall keep the Delaware Trustee
reasonably informed of any action taken by the Sponsor Trustees with respect to
the Trust that may affect the Delaware Trustee. The Delaware Trustee shall not
have any of the duties and responsibilities of the Sponsor Trustees or any other
trustee constituted pursuant to Article XI of this Agreement or otherwise. The
Delaware Trustee shall not be liable for the acts or omissions of the Sponsor
Trustees, the Trust, or any other Person and shall have no duty to supervise or
monitor the Sponsor Trustees, the Trust, or any other Person. The Delaware
Trustee shall owe no fiduciary or other duties to the Trust or the Beneficiaries
except as expressly provided for in this Article X.
10.2 Acceptance of Trusts. The Delaware Trustee accepts the trusts
hereby created and continued and agrees to perform its duties hereunder with
respect to the same but only upon the terms of this Agreement. The Delaware
Trustee shall not be personally liable to any Person under any circumstances in
connection with any of the transactions contemplated by this Agreement, except
that such limitation shall not relieve the Delaware Trustee of any personal
liability it may have to the Beneficiaries for the Delaware Trustee's own bad
faith, willful misconduct or gross negligence. In particular, but not by way of
limitation:
(i) The Delaware Trustee shall not be personally liable for
any error of judgment made in good faith;
(ii) No provision of this Agreement shall require the
Delaware Trustee to expend or risk its personal funds or otherwise incur any
financial liability in the exercise of its rights or powers under this
Agreement;
(iii) Under no circumstance shall the Delaware Trustee be
personally liable for any representation, warranty, covenant, obligation or
indebtedness of the Trust or the Sponsor Trustees; and
(iv) The Delaware Trustee shall not be personally responsible
for or in respect of the validity or sufficiency of this Agreement or for the
due execution hereof by any Person other than the Delaware Trustee.
10.3 Reliance. The Delaware Trustee shall incur no liability to
anyone in acting upon any signature, instrument, notice, resolution, request,
consent, order, certificate, report, opinion, bond or other document or paper
believed by it to be genuine and believed by it to be signed by the proper party
or parties. The Delaware Trustee may accept a certified copy of a resolution of
21
the board of directors or other governing body of any Person as conclusive
evidence that such resolution has been duly adopted by such body and that the
same is in full force and effect. As to any fact or matter, the Delaware Trustee
may for all purposes hereof rely on a certificate, signed by any director, the
president, any vice president, the treasurer, any assistant treasurer, the
secretary, any assistant secretary or any other officer or representative of the
relevant party, and such certificate shall constitute full protection to the
Delaware Trustee for any action taken or omitted to be taken by it in good faith
in reliance thereon.
10.4 Agents, Counsel, Etc. When reasonably necessary in the exercise
or administration of the trusts hereunder, the Delaware Trustee may, at the
expense of the Trust, consult with counsel, accountants and other skilled
Persons, and the Delaware Trustee shall not be liable for anything done,
suffered or omitted in good faith by it in accordance with the advice or opinion
of any such counsel, accountants, or other skilled Persons selected by it in
good faith.
10.5 Not Acting in Individual Capacity. Except as expressly provided
in this Article X, in accepting the trusts hereby created, the Delaware Trustee
acts solely as trustee hereunder and not in its individual capacity, and all
persons having any claim against the Delaware Trustee by reason of the
transactions contemplated by this Agreement shall look only to the Trust Assets
for payment or satisfaction thereof.
10.6 Compensation. The Delaware Trustee shall be entitled to receive
from the Trust as compensation for its services hereunder, such fees as have
been separately agreed upon with the Trust.
10.7 Reimbursement; Indemnity; Insurance. The Trust shall (i)
reimburse the Delaware Trustee for all reasonable expenses incurred by it in
connection with the execution and performance of its rights and duties hereunder
(including reasonable fees and expenses of counsel and other experts), (ii)
indemnify, defend and hold harmless the Delaware Trustee (in both its individual
and trustee capacities) and the officers, directors, employees and agents of the
Delaware Trustee (collectively, including the Delaware Trustee in its individual
capacity, the "DT Covered Persons") from and against any and all losses,
damages, liabilities, claims, actions, suits, costs, expenses, disbursements
(including the reasonable fees and expenses of counsel), taxes and penalties of
any kind and nature whatsoever, to the extent that such expenses arise out of or
are imposed upon or asserted at any time against one (1) or more DT Covered
Persons with respect to the performance of this Agreement, the creation,
operation, administration or termination of the Trust, or the transactions
contemplated by this Agreement (all such expenses as provided in clauses (i) and
(ii) are herein referred to collectively as "DT Expenses"); provided, however,
that the Trust shall not be required to indemnify a DT Covered Person for DT
Expenses if there is a final, non-appealable judgment by a court of competent
jurisdiction that includes an explicit finding of fact that the act or omission
in connection with which such DT Expense was incurred by such DT Covered Person
constituted bad faith, willful misconduct, or gross negligence on the part of
such DT Covered Person. The Sponsor Trustee shall, at the expense of the Trust,
maintain insurance for the protection of the Delaware Trustee in such form and
amount as is reasonably acceptable to the Delaware Trustee.
10.8 No Action Except as Specified in Agreement or Instructions. The
Delaware Trustee shall take such action or refrain from taking such action under
this Agreement as it may be directed in writing by the Managing Trustee from
22
time to time; provided, however, that the Delaware Trustee shall not be required
to take or refrain from taking any such action if it shall have determined, or
shall have been advised by counsel, that such performance is likely to involve
the Delaware Trustee in personal liability or is contrary to the terms of this
Agreement or of any document contemplated hereby to which the Trust is a party
or is otherwise contrary to law. If at any time the Delaware Trustee determines
that it requires or desires guidance regarding the application of any provision
of this Agreement or any other document, then the Delaware Trustee may deliver a
notice to the Managing Trustee requesting written instructions as to the course
of action desired by the Managing Trustee and such instructions shall constitute
full and complete authorization and protection for actions taken by the Delaware
Trustee in reliance thereon. If the Delaware Trustee does not receive such
instructions within five (5) Business Days after it has delivered to the
Managing Trustee such notice requesting instructions, or such shorter period of
time as may be set forth in such notice, it may refrain from taking any action
with respect to the matters described in such notice.
10.9 Duties, Etc. To the extent that, at law or in equity, a DT
Covered Person has duties (including fiduciary duties) and liabilities relating
to the Trust, the Beneficiaries or to any other Person, such DT Covered Person
acting under this Agreement shall not be liable to the Trust, the Beneficiaries
or to such other Persons for its good faith reliance on the provisions of this
Agreement. To the extent that provisions of this Agreement restrict the duties
and liabilities of a DT Covered Person otherwise existing at law or in equity,
such provisions are agreed by the parties hereto and Persons bound hereby to
replace such other duties and liabilities of such DT Covered Person.
10.10 Resignation and Removal. The Delaware Trustee may resign and be
discharged of the trust created by this Agreement upon not less than 90 days
prior written notice to the Managing Trustee. Upon receiving such notice of
resignation, the Sponsor Trustees shall use their reasonable best efforts
promptly to appoint a substitute or successor Delaware Trustee in the manner and
meeting the qualifications hereinafter provided by written instrument or
instruments delivered to such resigning Delaware Trustee and the substitute or
successor Delaware Trustee. In addition, the Sponsor Trustees may remove the
Delaware Trustee, with or without cause, and appoint a successor Delaware
Trustee satisfying the requirement of Section 3807(a) of the Delaware Act by
written instrument or instruments delivered to the Delaware Trustee being
removed and to the substitute or successor Delaware Trustee. Any resignation or
removal of the Delaware Trustee and appointment of a substitute or successor
Delaware Trustee shall become effective only upon acceptance of the appointment
by the substitute or successor Delaware Trustee. If no substitute or successor
Delaware Trustee shall have been appointed within 60 days after notice of such
resignation or removal has been delivered, the Delaware Trustee may, at the
expense of the Trust, apply to a court of competent jurisdiction for the
appointment of a successor Delaware Trustee. Such court may thereupon, after
such notice, if any, as it may deem proper, prescribe and appoint a successor
Delaware Trustee satisfying the requirement of Section 3807(a) of the Delaware
Act.
10.11 Merger, Succession. Any Person into which the Delaware Trustee
may be merged or with which it may be consolidated, or any Person resulting from
any merger or consolidation to which the Delaware Trustee shall be a party, or
any Person which succeeds to all or substantially all of the corporate trust
business of the Delaware Trustee, shall be the successor Delaware Trustee under
23
this Agreement without the execution, delivery or filing of any paper or
instrument or further act to be done on the part of the parties hereto (except
for the filing of an amendment to the Certificate of Trust if required by the
Delaware Act), notwithstanding anything to the contrary herein; provided
however, that such successor Delaware Trustee shall satisfy the requirement of
Section 3807(a) of the Delaware Act.
10.12 Amendments to Article X; Construction. No amendment of this
Article X, and no other amendment of this Agreement which affects the rights,
duties, liabilities, indemnities or immunities of the Delaware Trustee, shall be
effective without, in each specific instance, the prior written approval of the
Delaware Trustee. The rights of the DT Covered Persons under this Article X
shall survive the termination of this Agreement and the resignation or removal
of the Delaware Trustee. In the event of any inconsistency between the
provisions of this Article X and any other provision of this Agreement, the
provisions of this Article X shall be controlling.
ARTICLE XI
PROTECTION OF PERSONS DEALING WITH TRUSTEES
Any Person dealing with the Trustees shall be fully protected
in relying upon a Trustee's certificate, signed by any one of the Trustees, with
respect to the authority that one or more Trustees has to take any action under
the Trust. Any Person dealing with the Trustees shall be fully protected in
relying upon the Trustee's certificate setting forth the facts concerning the
action taken by the Trustees pursuant to this Agreement, including, if
applicable, the aggregate number of Units held by the Beneficiaries causing such
action to be taken.
ARTICLE XII
CONCERNING THE BENEFICIARIES
12.1 Evidence of Action by Beneficiaries. Whenever in this Agreement
it is provided that the Beneficiaries may take any action (including the making
of any demand or request, the giving of any notice, consent, or waiver, the
removal of a Trustee, the appointment of a successor Trustee, or the taking of
any other action), the fact that at the time of taking any such action such
Beneficiaries have joined therein may be evidenced: (i) by any instrument or any
number of instruments of similar tenor executed by the Beneficiaries in person
or by agent or attorney appointed in writing; or (ii) by the record of the
Beneficiaries voting in favor thereof at any meeting of Beneficiaries duly
called and held in accordance with the provisions of Article XIII.
12.2 Limitation on Suits by Beneficiaries. To the fullest extent
permitted by law, no Beneficiary shall have any right by virtue of any provision
of this Agreement to institute any action or proceeding at law or in equity
against any party other than the Sponsor Trustees upon or under or with respect
to the Trust Assets or the agreements relating to or forming part of the Trust
Assets, and the Beneficiaries (by their acceptance of any distribution made to
them pursuant to this Agreement) waive any such right. An action by a
Beneficiary against a Sponsor Trustee must be commenced within three years after
the cause of action has accrued, or within two years after the time when the
cause of action is discovered or should have been discovered by the Beneficiary,
whichever occurs first.
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12.3 Requirement of Undertaking. The Sponsor Trustees may request any
court to require, and any court may in its discretion require, in any suit for
the enforcement of any right or remedy under this Agreement, or in any suit
against a Trustee for any action taken or omitted to be taken as Trustee, the
filing by any party litigant in such suit of an undertaking to pay the costs of
such suit, and such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made by
such party litigant; provided that the provisions of this Section 12.3 shall not
apply to any suit by the Trustees and shall not in any circumstance apply to the
Delaware Trustee.
ARTICLE XIII
MEETING OF BENEFICIARIES
13.1 Purpose of Meetings. A meeting of the Beneficiaries may be
called at any time and from time to time pursuant to the provisions of this
Article for the purposes of taking any action which the terms of this Agreement
permit Beneficiaries having a specified aggregate Beneficial Interest to take
either acting alone or with the Sponsor Trustees.
13.2 Meeting Called by the Sponsor Trustees. Any Sponsor Trustee may
at any time call a meeting of the Beneficiaries to be held at such time and at
such place as such Sponsor Trustee shall determine. Written notice of every
meeting of the Beneficiaries shall be given by the Managing Trustee (except as
provided in Section 13.3 of this Agreement), which written notice shall set
forth the time and place of such meeting and in general terms the action
proposed to be taken at such meeting, and shall be mailed not more than 60 nor
less than 10 days before such meeting is to be held to all of the Beneficiaries
of record as of a record date not more than 60 days before the date of such
meeting fixed by the Managing Trustee. The notice shall be directed to the
Beneficiaries at their respective addresses as they appear in the records of the
Trust.
13.3 Meeting Called on Request of Beneficiaries. Within 30 days after
written request to the Managing Trustee by Beneficiaries holding an aggregate of
at least ten percent (10%) of the total Units held by all Beneficiaries to call
a meeting of all Beneficiaries, which written request shall specify in
reasonable detail the action proposed to be taken, the Managing Trustee shall
proceed under the provisions of Section 13.2 of this Agreement to call a meeting
of the Beneficiaries, and if the Managing Trustee fails to call such meeting
within such 30 day period then such meeting may be called by such Beneficiaries,
or their designated representatives, requesting such meeting.
13.4 Persons Entitled to Vote at Meeting of Beneficiaries. Each
Beneficiary shall be entitled to vote at a meeting of the Beneficiaries either
in person or by his proxy duly authorized in writing. The signature of the
Beneficiary on such written authorization need not be witnessed or notarized.
Each Beneficiary shall be entitled to a number of votes equal to the number of
Units held by such Beneficiary as of the applicable record date.
13.5 Quorum. At any meeting of Beneficiaries, the presence of
Beneficiaries having aggregate Units sufficient to take action on any matter for
the transaction of which such meeting was called shall be necessary to
constitute a quorum; but if less than a quorum be present, Beneficiaries having
25
aggregate Units of at least a majority of the total Units held by all
Beneficiaries represented at the meeting may adjourn such meeting with the same
effect and for all intents and purposes as though a quorum had been present.
Except to the extent a different percentage is specified in this Agreement for a
particular matter or is required by law, only the Required Consent of the
Beneficiaries shall be required for taking action on any matter voted on by the
Beneficiaries, including any conversion, merger or consolidation of the Trust
with or into another Person.
13.6 Adjournment of Meeting. Subject to Section 13.5 of this
Agreement, any meeting of Beneficiaries may be adjourned from time to time and a
meeting may be held at such adjourned time and place without further notice.
13.7 Conduct of Meetings. The Managing Trustee shall appoint the
Chairman and the Secretary of the meeting. The vote upon any resolution
submitted to any meeting of Beneficiaries shall be by written ballot. An
Inspector of Votes, appointed by the Chairman of the meeting, shall count all
votes cast at the meeting for or against any resolution and shall make and file
with the Secretary of the meeting its verified written report.
13.8 Record of Meeting. A record of the proceedings of each meeting
of Beneficiaries shall be prepared by the Secretary of the meeting. The record
shall be signed and verified by the Secretary of the meeting and shall be
delivered to Sponsor Trustees to be preserved by the Trust. Any record so signed
and verified shall be conclusive evidence of all of the matters therein stated.
ARTICLE XIV
AMENDMENTS
14.1 Consent of Trustees and Beneficiaries. Any amendment to this
Agreement must be proposed by and approved by a majority of the Sponsor
Trustees, but no amendment shall require the approval of the Beneficiaries
unless the Beneficiaries would be materially and adversely affected by the
amendment, in which case the amendment must be approved by the Required Consent
of the Beneficiaries; provided that no such amendment shall increase the
potential liability of the Trustees hereunder without the written consent of
each Trustee or alter the rights, duties or obligations of the Delaware Trustee
without the written consent of such Delaware Trustee; provided, further, that no
such amendment shall affect the Beneficiaries' rights to receive their pro rata
shares of the Trust Assets at the time of any distribution, and that no such
amendment shall cause the Trust, in the opinion of counsel, to be treated for
Federal, state or local income tax purposes, as other than a liquidating trust
under Treasury Regulation Section 301.7701-4(d), or cause the Beneficiaries to
be treated as other than the owners of their respective shares of the Trust's
taxable income pursuant to Section 671 through 679 of the Code and any analogous
provision of state or local law.
14.2 Notice and Effect of Amendment. Upon approval of an amendment to
this Agreement in accordance with Section 14.1 hereof, the Sponsor Trustees
shall prepare and execute, or cause to be executed, such amendment. Promptly
after the execution by the Sponsor Trustees of any such amendment, the Sponsor
Trustees shall give notice of the substance of such amendment to the
Beneficiaries or, in lieu thereof, the Sponsor Trustees may send a copy of the
amendment to each Beneficiary. Upon the execution of any such amendment by the
26
Sponsor Trustees, this Agreement shall be deemed to be modified and amended in
accordance therewith and the respective rights, limitations of rights,
obligations, duties, and immunities of the Sponsor Trustees and the
Beneficiaries under this Agreement shall thereafter be determined, exercised and
enforced hereunder subject in all respects to such modification and amendments,
and all the terms and conditions of any such amendment shall thereby be deemed
to be part of the terms and conditions of this Agreement for any and all
purposes.
ARTICLE XV
MISCELLANEOUS PROVISIONS
15.1 Filing Documents. This Agreement, together with any amendments,
shall be filed or recorded in such office or offices as the Sponsor Trustees may
determine to be necessary or desirable. A copy of this Agreement and all
amendments thereof shall be maintained in the office of the Trust and shall be
available at all times during regular business hours for inspection by any
Beneficiary or his duly authorized representative.
15.2 Intention of Parties to Establish Trust. This Agreement is not
intended to create, and shall not be interpreted as creating, a corporation,
association, partnership, or joint venture of any kind for purposes of Federal
income taxation or for any other purpose.
15.3 Beneficiaries Have No Rights or Privileges as Stockholders of
the Company. Except as expressly provided in this Agreement or under applicable
law, the Beneficiaries shall have no rights or privileges attributable to their
former status as stockholders of the Company.
15.4 Laws as to Construction. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware.
15.5 Severability. In the event any provision of this Agreement or
the application thereof to any Person or circumstances shall be finally
determined by a court of proper jurisdiction to be invalid or unenforceable to
any extent, the remainder of this Agreement, or the application of such
provision to persons or circumstances other than those as to which it is held
invalid or unenforceable, shall not be affected thereby, and each provision of
this Agreement shall be valid and enforced to the fullest extent permitted by
law.
15.6 Notices. Any notice or other communication by the Trustees to
any Beneficiary given pursuant to or in connection with this Agreement shall be
deemed to have been sufficiently given, for all purposes, five days after
deposit, postage prepaid, in the post office or letter box addressed to such
Person at his address as shown in the records of the Trust. All notices and
other communications to any Trustee or the Trust hereunder shall be in writing
and shall be deemed to have been duly given upon actual receipt by the parties
at the following addresses or at such other addresses as shall be specified by
the parties:
27
(a) If to the Delaware Trustee:
Wachovia Bank of Delaware, National Association
One ▇▇▇▇▇▇ Square
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
ATTN: Corporate Trust Administration
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
With a copy to:
Morris, James, Hitchens & ▇▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇., Esquire
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
(b) If to the Managing Trustee or the Trust:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, #▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇ & Lardner LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Esquire
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(c) If to ▇▇▇▇▇:
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(d) If to ▇▇▇▇▇▇▇:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, III
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
28
(e) If to Kross
▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
15.7 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but such counterparts shall
together constitute one and the same instrument.
[Signatures appear on the following page]
29
IN WITNESS WHEREOF, ▇▇▇▇▇ Realty Investors, Inc. has caused
this Agreement to be executed by its Chief Executive Officer, and the Trustees
herein have executed this Agreement, as Trustees and not as individuals,
effective this 27th day of August, 2004.
▇▇▇▇▇ REALTY INVESTORS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Executive Officer
DELAWARE TRUSTEE
WACHOVIA BANK OF DELAWARE, NATIONAL
ASSOCIATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Trust Officer
SPONSOR TRUSTEES
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
/s/ ▇▇▇▇ ▇▇▇▇▇
----------------------------------------
▇▇▇▇ ▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, III
----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, III
[Signature Page to Liquidating Trust Agreement]