EXHIBIT 10.1(K)
AMENDED AND RESTATED
SENSIENT TECHNOLOGIES CORPORATION
RABBI TRUST "A" AGREEMENT
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This Trust Agreement is made effective as of the 1st day of March, 2002 by and
between Sensient Technologies Corporation, a Wisconsin corporation (the
"Company"), and ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ Trust Company (collectively with any successor
in interest, the "Trustee").
WHEREAS, the Company is obligated in accordance with the terms of various
agreements listed on Appendix A, as the same may be amended from time-to-time
(collectively the "Contracts"), to make certain payments for the benefit of
selected Company executives (the "Executives") in the event of a change of
control of the Company; and
WHEREAS, as the Company has incurred or expects to incur liability under the
terms of such Contracts, the Company established a trust (the "Trust") and
entered into a trust agreement dated January 1, 2001 (the "Prior Trust
Agreement") with Trustee, with the intention that the Company would make
contributions to such Trust to provide itself with a source of funds to assist
it in meeting its liabilities under the Contracts (the "Executives"); and
WHEREAS, it is the intention of the Company that the Trust shall constitute an
unfunded arrangement and shall not affect the status of any Contract as an
unfunded plan maintained for the purpose of providing deferred compensation for
a select group of management or highly compensated employees for purposes of
Title I of the Employee Retirement Income Security Act of 1974, as amended; and
WHEREAS, the Company and the Trustee have determined to amend the Prior Trust
Agreement, effective as of March 1, 2002, and the Prior Trust Agreement may be
amended by a written instrument signed by the Company and the Trustee because a
Change in Control has not yet occurred; and
NOW, THEREFORE, in consideration of the mutual agreements of the parties as
contained in this Trust Agreement, the Trust shall be comprised, held and
disposed of as follows:
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Section 1. Successor Trust
(a) The Company and Trustee hereby acknowledge the deposit with the
Trustee of assets previously held under the Prior Trust Agreement, which shall
continue as the principal of the Trust.
(b) The Trust shall become irrevocable upon a Change of Control, as
defined herein.
(c) The Trust is intended to be a grantor trust, of which the Company
is the grantor, within the meaning of subpart E, part 1, subchapter J, chapter
1, subtitle A of the Internal Revenue Code of 1986, as amended, and shall be
construed accordingly.
(d) The principal of the Trust, and any earnings thereon shall be held
separate and apart from other funds of the Company and shall be used exclusively
for the uses and purposes of paying benefits to Executives as required by the
Contracts and claims of general creditors, as herein set forth. Executives shall
have no preferred claim on, or any beneficial ownership interest in, any assets
of the Trust. Any rights created under the Contracts and this Trust Agreement
shall be mere unsecured contractual rights of Executives against the Company.
Any assets held by the Trust will be subject to the claims of the Company's
general creditors under federal and state law in the event the Company is
Insolvent, as defined in Section 3(a) herein.
(e) The Company, in its sole discretion, may at any time, or from time
to time, make additional deposits of cash or other property in trust with the
Trustee to augment the principal to be held, administered and disposed of by the
Trustee as provided in this Trust Agreement. Neither the Trustee nor any
Executive shall have any right to compel such additional deposits.
(f) Upon a Change of Control as defined herein, the Company shall,
immediately prior to such Change of Control, make an irrevocable contribution to
the Trust in an amount that is sufficient to pay the Executives the benefits to
which Executives would be entitled pursuant to the terms of the Contract(s) as
of the date on which the Change of Control occurred; provided, however, payment
of benefits through this Rabbi Trust A shall not duplicate any benefits payable
to Executives through Rabbi Trust B or C (which provide for payment of benefits
for several non-qualified benefit plans of the Company) or any other irrevocable
trust arrangement providing for secured payment of benefits to Executives,
notwithstanding that the benefits shall be payable upon a Change of Control
pursuant to the terms of the Contracts.
Section 2. Payments to Executives
(a) Immediately prior to a Change of Control, the Company shall
deliver to the Trustee a schedule (the "Payment Schedule") that indicates the
amounts payable in respect of each Executive, that provides a formula or other
instructions acceptable to Trustee for determining the amounts so payable, the
form in which such amount is to be paid (as provided for under the Contracts),
and the time of commencement for payment of such amounts. Except
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as otherwise provided herein, the Trustee shall make payments to the Executives
in accordance with such Payment Schedule. The Trustee shall make provision for
the reporting and withholding of any federal, state or local taxes that may be
required to be withheld with respect to the payment of benefits pursuant to the
terms of the Contracts and shall pay amounts withheld to the appropriate taxing
authorities or determine that such amounts have been reported, withheld and paid
by the Company.
(b) In the event that an Executive reasonably believes that the
Payment Schedule, as provided initially or modified, does not properly reflect
the amount payable to such Executive or the time or form of payment from the
Trust corpus in respect of the Contracts, such Executive shall be entitled to
deliver to the Trustee an affidavit (the "Executive's Notice") setting forth
payment instructions for the amount the Executive believes will be or is due
under the relevant terms of the Contracts. The Executive shall also deliver a
copy of the Executive's Notice to the Company within three (3) business days
following the date the Executive's Notice is delivered to the Trustee. Unless
the Trustee receives written objection from the Company within ten (10) business
days after receipt by the Trustee of such notice, the Trustee shall make the
payment distribution in accordance with the amount and instructions set forth in
the Executive Notice to the extent the funds necessary to make any such payments
due are available within the Trust. If the Company makes an objection during the
ten (10) business days referred to in the preceding sentence, the Trustee shall
retain any disputed amounts pending the determination of an arbitrator pursuant
to Section 14 hereof.
(c) The entitlement of an Executive to benefits under a Contract shall
be determined by the Company or such party as it shall designate, and any claim
for such benefits shall be considered and reviewed under procedures determined
by the Company and uniformly applied.
(d) The Company may make payment of benefits directly to Executives as
they become due under the terms of the Contracts. The Company shall notify the
Trustee of its decision to make payment of benefits directly prior to the time
amounts are payable to Executives. In addition, if the principal of the Trust,
and any earnings thereon, are not sufficient to make payments of benefits in
accordance with the terms of the Contracts, the Company shall make the balance
of each such payment as it falls due. The Trustee shall notify the Company where
principal and earnings are not sufficient.
Section 3. Trustee Responsibility Regarding Payments to Trust Beneficiary
When The Company Is Insolvent
(a) The Trustee shall cease payment of benefits to Executives if the
Company is Insolvent. The Company shall be considered "Insolvent" for purposes
of this Trust Agreement if (i) the Company is unable to pay its debts as they
become due, (ii) the Company is subject to a pending proceeding as a debtor
under the United States Bankruptcy Code, or (iii) the Company is determined to
be insolvent by any state or federal regulatory authority.
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(b) At all times during the continuance of this Trust, as provided in
Section l(d) hereof, the principal and income of the Trust shall be subject to
claims of general creditors of the Company under federal and state law as set
forth below.
(1) The Board of Directors and the Chief Executive Officer of the
Company shall have the duty to inform the Trustee in writing that the Company is
Insolvent. If a person claiming to be a creditor of the Company alleges in
writing to the Trustee that the Company has become Insolvent, the Trustee shall
determine whether the Company is Insolvent and, pending such determination, the
Trustee shall discontinue payment of benefits to Executives.
(2) Unless the Trustee has actual knowledge that the Company is
Insolvent, or has received notice from the Company or a person claiming to be a
creditor alleging that the Company is Insolvent, the Trustee shall have no duty
to inquire whether the Company is Insolvent. The Trustee may in all events rely
on such evidence concerning whether the Company is Insolvent as may be furnished
to the Trustee and that provides the Trustee with a reasonable basis for making
a determination whether the Company is Insolvent.
(3) If at any time the Trustee has determined that the Company is
Insolvent, the Trustee shall discontinue payments to Executives and shall hold
the assets of the Trust for the benefit of the Company's general creditors.
Nothing in this Trust Agreement shall in any way diminish any rights of
Executives to pursue their rights as general creditors of the Company with
respect to benefits due under the Contracts or otherwise.
(4) The Trustee shall resume the payment of benefits to
Executives in accordance with Section 2 of this Trust Agreement only after the
Trustee has determined that the Company is not Insolvent (or is no longer
Insolvent).
(c) Provided that there are sufficient assets, if the Trustee
discontinues the payment of benefits from the Trust pursuant to Section 3(b)
hereof and subsequently resumes such payments, the first payment following such
discontinuance shall include the aggregate amount of all payments due to
Executives under the terms of the Contracts for the period of such
discontinuance, less the aggregate amount of any payments made to Executives by
the Company in lieu of the payments provided for hereunder during any such
period of discontinuance.
Section 4. Payments to Company
Except as provided in Section 3 hereof, after a Change of Control, the
Company shall have no right or power to direct the Trustee to return to the
Company, or to divert to others, any of the Trust assets before all payment of
benefits have been made to Executives pursuant to the terms of the Contracts,
except in the case of a termination of the Trust pursuant to Section 12.
Section 5. Investment Authority
(a) Investments of the Trust shall be limited to cash, cash
equivalents and other short time fixed income securities (including any such
security from which the Trustee or an
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affiliate receives any compensation or fee). Prior to a Change in Control, the
Company shall have sole authority to direct the Trustee as to such specific
securities in which Trustee shall invest such Trust Fund assets. Following a
Change in Control, such powers and authority regarding investments shall rest
solely with the Trustee who shall invest such Trust Fund assets in its sole
discretion in cash equivalents and other short time fixed income securities
(including any such security from which the Trustee or an affiliate receives any
compensation or fee). In no event shall any investment authority be exercisable
by or rest with Executives; provided that, voting rights with respect to Trust
assets will be exercised by the Company prior to a Change in Control and will be
exercised by the Trustee after a Change in Control.
(b) The Company shall have the right at anytime, and from time to time
in its sole discretion, to substitute assets of equal fair market value for any
assets held by the Trust. This right is exercisable by the Company in a
nonfiduciary capacity without the approval or consent of any person in a
fiduciary capacity.
(c) The Trustee shall also have the following additional powers:
(1) To receive and hold all contributions paid to it by the
Company; provided, however, that the Trustee shall have no duty to require any
contributions to be made to it;
(2) To effectuate the written investment instructions given by
the Company or its designee without regard to any law now or hereafter in force
limiting investments of fiduciaries;
(3) To retain in the Trust for investments any property deposited
by the Trustee hereunder;
(4) To have the authority to invest and reinvest assets of the
Trust in cash, cash equivalents and other short time fixed income securities
(including any such security from which the Trustee or an affiliate receives any
compensation or fee);
(5) To retain in the Trust for investment or pending
distributions, any portion of the Trust in cash deemed appropriate by the
Trustee;
(6) To establish accounts in any affiliate of the Trustee and in
such other banks and financial institutions as the Trustee deems appropriate to
carry out the purpose of the Trust;
(7) To deposit securities with a clearing corporation as defined
in Article Eight of the Uniform Commercial Code; to hold the certificates
representing securities, including those in bearer form, in bulk form with and
to merge such certificates into certificates of the same class of the same
issuer which constitutes assets of other accounts or owners, without
certification as to the ownership attached; and to utilize a book-entry system
for the transfer or pledge of securities held by the Trustee or by a clearing
corporation, provided that the records of the Trustee shall indicate the actual
ownership of the securities and other property of the Trust Fund;
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(8) To participate in and use the Federal book-entry account
system, a service provided by the Federal Reserve Bank for its member banks for
deposit of Treasury securities; and
(9) To hold securities or property in the name of the Trustee or
its nominee or nominees or in such other form as it determines best with or
without disclosing the Trust relationship, providing the records of the Trust
shall indicate the actual ownership of such securities or other property.
Section 6. Disposition of Income
As determined in the sole discretion of the Company prior to a Change
of Control, all or part of the income received by the Trust, net of expenses and
taxes, shall be returned to the Company, as determined by the Company. Following
a Change in Control, all income shall be accumulated and reinstated.
Section 7. Accounting by Trustee
The Trustee shall keep accurate and detailed records of all
investments, receipts, disbursements, and all other transactions required to be
made, including such specific records as shall be agreed upon in writing between
the Company and the Trustee. Within thirty (30) days after the removal or
resignation of the Trustee, the Trustee shall deliver to the Company a written
account of its administration of the Trust during such year or during the period
from the close of the last preceding year to the date of such removal or
resignation, setting forth all investments, receipts, disbursements and other
transactions effected by it, including a description of all securities and
investments purchased and sold with the cost or net proceeds of such purchases
or sales (accrued interest paid or receivable being shown separately), and
showing all cash, securities and other property held in the Trust at the end of
such year or as of the date of such removal or resignation, as the case may be.
Section 8. Responsibility of Trustee
(a) The Trustee shall act with the care, skill, prudence and diligence
under the circumstances then prevailing that a prudent person acting in like
capacity and familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims; provided, however, that the
Trustee shall incur no liability to any person for any action taken pursuant to
a direction, request or approval given by the Company which is contemplated by,
and in conformity with, the terms of the Contracts or this Trust and is given in
writing by the Company. In the event of a dispute between the Company and a
party, the Trustee may apply to a court of competent jurisdiction to resolve the
dispute.
(b) If the Trustee undertakes or defends any litigation arising in
connection with this Trust, the Company agrees to indemnify the Trustee against
the Trustee's costs, expenses and liabilities (including, without limitation,
attorneys' fees and expenses) relating thereto and to be primarily liable for
such payments. If the Company does not pay such costs, expenses and liabilities
in a reasonably timely manner, the Trustee may obtain payment from the Trust.
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(c) The Trustee may consult with legal counsel (who may also be
counsel for the Company generally) with respect to any of its duties or
obligations hereunder.
(d) The Trustee may hire agents, accountants, actuaries, investment
advisors, financial consultants or other professionals to assist it in
performing any of its duties or obligations hereunder.
(e) The Trustee shall have, without exclusion, all powers conferred on
Trustees by applicable law, unless expressly provided otherwise herein;
provided, however, that if an insurance policy is held as an asset of the Trust,
the Trustee shall have no power to name a beneficiary of the policy other than
the Trust, to assign the policy (as distinct from conversion of the policy to a
different form) other than to a successor Trustee, or to loan to any person the
proceeds of any borrowing against such policy.
(f) Notwithstanding any powers granted to the Trustee pursuant to this
Trust Agreement or to applicable law, the Trustee shall not have any power that
could give this Trust the objective of carrying on a business and dividing the
gains therefrom, within the meaning of section 301.7701-2 of the Procedure and
Administrative Regulations promulgated pursuant to the Internal Revenue Code.
(g) The Company hereby agrees to indemnify and to hold Trustee
harmless from and against all claims, expenses (including reasonable attorney
fees), liabilities, damages, actions or other charges incurred by or assessed
against Trustee, other than on account of Trustee's own gross negligence or
willful misconduct, as a direct or indirect result of anything done or omitted
by Trustee in reliance upon the directions, or absence of directions, of the
Company, any investment advisor or manager, or as a direct or indirect result of
any act or omission of a predecessor trustee or any other person charged under
any agreement affecting the assets of the Trust for investment responsibility
with respect to such assets.
Section 9. Compensation and Expenses of Trustee
The Company shall pay all administrative costs and the Trustee's fees
and expenses. If not so paid, the costs, fees and expenses shall be paid from
the Trust.
Section 10. Resignation and Removal of Trustee
(a) The Trustee may resign at any time by written notice to the
Company, which shall be effective no less than thirty (30) days after receipt of
such notice unless the Company and the Trustee agree otherwise.
(b) The Trustee may be removed by the Company on fifteen (15) days
notice or upon shorter notice accepted by the Trustee.
(c) Upon resignation or removal of the Trustee and appointment of a
successor Trustee, all assets shall subsequently be transferred to the successor
Trustee. The transfer shall
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be completed within thirty (30) days after receipt of notice of resignation,
removal or transfer, unless the Company extends such time limit.
(d) If the Trustee resigns or is removed, a successor shall be
appointed, in accordance with Section 11 hereof, by the effective date of
resignation or removal under paragraphs (a) or (b) of this section. If no such
appointment has been made, the Trustee may apply to a court of competent
jurisdiction for appointment of a successor or for instructions. All expenses of
the Trustee in connection with the proceeding shall be allowed as administrative
expenses of the Trust.
Section 11. Appointment of Successor
(a) If the Trustee resigns or is removed in accordance with Section 10
(a) or (b) hereof, the Company may appoint any third party, such as a bank trust
department or other party that may be granted corporate trustee powers under
state law, as a successor to replace the Trustee upon resignation or removal.
The appointment shall be effective when accepted in writing by the new Trustee,
who shall have all of the rights and powers of the former Trustee, including
ownership rights in the Trust assets. The former Trustee shall execute any
instrument necessary or reasonably requested by the Company or the successor
Trustee to evidence the transfer.
The successor Trustee need not examine the records and any acts of any
prior Trustee and may retain or dispose of any existing Trust assets, subject to
Sections 7 and 8 hereof. The successor Trustee shall not be responsible for, and
Company shall indemnify and defend the successor Trustee from, any claim or
liability resulting from any action or inaction of any prior Trustee or from any
other past event, or any condition existing at the time it becomes successor
Trustee.
(b) Notwithstanding Section 11(a) above, if the Trustee resigns or is
removed within three (3) years following a Change in Control, the Company may
appoint such third party as Trustee only with the approval of 2/3 or more of the
Executives (who were employees of Company immediately before the Change in
Control, but determining such 2/3 considering only those Executives who at the
time of the Trustee's resignation or removal continue to have Contracts funded
by the Trust). If the Company and such Executives are unable to agree on a
successor trustee within forty-five (45) days following the notice of the
Trustee's departure, the Trustee shall be entitled to petition a court of
competent jurisdiction to appoint its successor. All reasonable expenses of the
Trustee in connection with the proceeding shall be allowed as administrative
expenses of the Trust.
Section 12. Amendment or Termination
(a) Prior to a Change of Control, this Trust Agreement may be amended
by a written instrument executed by the Trustee and the Company. Notwithstanding
the foregoing, no such amendment shall conflict with the terms of the Contracts
or shall make the Trust revocable after it has become irrevocable in accordance
with Section l(b) hereof. This Trust Agreement may be amended in a manner
adverse to Executives only by an instrument in writing executed by the Trustee
and the Company, together with the consent of 2/3 of the Executives (who were
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employees of the Company immediately before the Change in Control, but
determining such 2/3 considering only those Executives who at the time of the
Trustee's resignation or removal continue to have Contracts funded by the
Trust).
(b) The Trust shall not terminate until the date on which Executives
are no longer entitled to benefits pursuant to the terms of the Contracts,
unless approved as provided in Section 12(c) hereof.
(c) Upon written approval of all Executives who remain entitled to
payment of benefits pursuant to the terms of the Contracts, the Company may
terminate this Trust prior to the time all benefits payable under the Payment
Schedule have been made. All assets in the Trust at termination shall be
returned to the Company.
Section 13. Miscellaneous
(a) Any provision of this Trust Agreement prohibited by law shall be
ineffective to the extent of any such prohibition, without invalidating the
remaining provisions hereof.
(b) Benefits payable to Executives under this Trust Agreement may not
be anticipated, assigned (either at law or in equity), alienated, pledged,
encumbered or subjected to attachment, garnishment, levy, execution or other
legal or equitable process.
(c) This Trust Agreement shall be governed by and construed in
accordance with the laws of Wisconsin.
(d) For purposes of this Trust, Change of Control shall mean:
(1) the acquisition by any individual, entity or group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended) (a "Person") of beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended) of
20% or more of either (A) the then outstanding shares of common stock of the
Company (the "Outstanding Company Common Stock") or (B) the combined voting
power of the then outstanding voting securities of the Company entitled to vote
generally in the election of directors (the "Outstanding Company Voting
Securities"); provided, however, that for purposes of this subsection (1), the
following acquisitions shall not constitute a Change of Control: (I) any
acquisition directly from the Company, (II) any acquisition by the Company,
(III) any acquisition by any employee benefit plan (or related trust) sponsored
or maintained by the Company or any corporation controlled by the Company or
(IV) any acquisition pursuant to a transaction which complies with clauses (A),
(B) and (C) of subsection (3) of this paragraph (d); or
(2) individuals who, as of March 1, 2002, constitute the Board of
Directors (the "Incumbent Board") cease for any reason to constitute at least a
majority of the Board of Directors; provided, however, that any individual
becoming a director subsequent to March 1, 2002 whose election, or nomination
for election by the Company's shareholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board, but
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excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board of Directors; or
(3) consummation by the Company of a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of the
assets of the Company or the acquisition of assets of another entity (a
"Business Combination"), in each case, unless, following such Business
Combination, (A) all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the Outstanding Company Common
Stock and Outstanding Company Voting Securities immediately prior to such
business combination beneficially own, directly or indirectly, more than 50% of,
respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns the Company or all or
substantially all of the Company's assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership
immediately prior to such Business Combination of the Outstanding Company Common
Stock and Outstanding Company Voting Securities, as the case may be, (B) no
Person (excluding any employee benefit plan (or related trust) of the Company or
of such corporation resulting from such Business Combination) beneficially owns,
directly or indirectly, 20% or more of, respectively, the then outstanding
shares of common stock of the corporation resulting from such Business
Combination or the combined voting power of the then outstanding voting
securities of such corporation except to the extent that such ownership existed
prior to the Business Combination and (C) at least a majority of the members of
the board of directors of the corporation resulting from such Business
Combination were members of the Incumbent Board at the time of the execution of
the initial agreement, or the action of the Board, providing for such Business
Combination; or
(4) approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company.
Section 14. Arbitration
Any dispute between the Executives and the Company or the Trustee as
to the interpretation or application of the provisions of this Trust, and any
questions concerning Benefits payable hereunder, shall be determined exclusively
by arbitration in accordance with the rules of the American Arbitration
Association then in effect. Such determination shall be final, conclusive and
binding upon the parties. Judgment may be entered on the arbitrator's award in
any court of competent jurisdiction. All fees and expenses of such arbitration
(including, without limitation, those incurred by the Executives and Trustee)
shall be paid by the Company.
Section 15. Effective Date
The effective date of this Trust Agreement shall be March 1, 2002.
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IN WITNESS WHEREOF, the Company and Trustee have caused this Trust Agreement to
be duly executed as of the Effective Date indicated above.
SENSIENT TECHNOLOGIES CORPORATION
By:
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Title:
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Title:
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▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ TRUST COMPANY
By:
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Title:
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Attest:
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Title:
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Appendix A
SENSIENT TECHNOLOGIES CORPORATION
RABBI TRUST "A" AGREEMENT
-------------------------
1. Executive Employment Contract, dated as of November 11, 1999, by and
between Sensient Technologies Corporation and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇.
2. Change of Control and Severance Agreements entered into between Sensient
Technologies and certain Executives from time to time, benefits under which
are to be provided to the Trustee upon a Change of Control, as provided in
Section 2 of the Trust Agreement.
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