EXHIBIT 10(b)
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RABBI TRUST AGREEMENT
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THIS AGREEMENT, made this ___ day of _____________, 1998
by and between Peoples Bancorp Inc. (the "Corporation") and The Peoples
Banking and Trust Company (the "Trustee").
WITNESSETH:
WHEREAS, the Corporation has adopted the Peoples Bancorp Inc.
Deferred Compensation Plan for Directors of Peoples Bancorp Inc. and
Subsidiaries (the "Plan");
WHEREAS, the Corporation has incurred or expects to incur
liability under the terms of such Plan with respect to the individuals
participating in such Plan;
WHEREAS, the Corporation wishes to establish a trust
(hereinafter called "the Trust") and to contribute to the Trust
assets that shall be held therein, subject to the claims of the
Corporation's creditors in the event of the Corporation's Insolvency,
as herein defined, until paid to Plan participants and their
beneficiaries in such manner and at such times as specified in the Plan;
WHEREAS, it is the intention of the parties that this Trust
shall constitute an unfunded arrangement and shall not affect the
status of the Plan as an unfunded plan maintained for the purpose of
providing deferred compensation for the participants and beneficiaries
of the Plan;
WHEREAS, it is the intention of the Corporation to make
contributions to the Trust to provide itself with a source of funds
to assist it in the meeting of its liabilities under the Plan;
NOW, THEREFORE, the parties do hereby establish the Trust
and agree that the Trust shall be comprised, held and disposed of
as follows:
Section 1
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Establishment of Trust
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(a) The Corporation hereby deposits with the Trustee
in trust Five Hundred Thousand Dollars ($500,000), which shall become
the principal of the Trust to be held, administered and disposed of
by the Trustee as provided in this Trust Agreement.
(b) The Trust hereby established shall be irrevocable.
(c) The Trust is intended to be a grantor trust, of
which the Corporation is the grantor, within the meaning of subpart E,
part I, subchapter J, chapter 1, subtitle A of the Internal Revenue
Code of 1986, as amended (the "Code"), 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 Corporation
and shall be used exclusively for the uses and purposes of Plan
participants and general creditors as herein set forth. Plan
participants and their beneficiaries shall have no preferred claim on,
or any beneficial ownership interest in, any assets of the Trust.
Any rights created under the Plan and this Trust Agreement shall be
mere unsecured contractual rights of Plan participants and their
beneficiaries against the Corporation. Any assets held by the Trust
will be subject to the claims of the Corporation's general creditors
under federal and state law in the event of Insolvency, as defined in
Section 3(a) herein.
(e) The Corporation, in its sole discretion, may at any
time, or from time to time, make additional deposits of cash or other
property in trust with the Trustee to augment the principal to be held,
administered and disposed of by the Trustee as provided in this Trust
Agreement. Neither the Trustee nor any Plan participant or beneficiary
shall have any right to compel such additional deposits.
Section 2
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Payments to Plan Participants and Their Beneficiaries
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(a) The Corporation shall deliver to the Trustee a
schedule (the "Payment Schedule") that indicates the amounts payable
in respect of each Plan participant and his or her beneficiaries, that
provides a formula or other instructions acceptable to the Trustee for
determining the amounts so payable, the form (cash, securities or other
assets) in which such amount is to be paid (as provided for or available
under the Plan) and the time of commencement for payment of such amounts.
Except as otherwise provided herein, the Trustee shall make payments to
the Plan participants and their beneficiaries in accordance with such
Payment Schedule. The Trustee shall make provision for the reporting
and withholding of any federal taxes that may be required to be withheld
with respect to the payment of benefits pursuant to the terms of the Plan
and shall pay amounts withheld to the appropriate taxing authorities or
determine that such amounts have been reported, withheld and paid by the
Corporation.
(b) The entitlement of a Plan participant or his or her
beneficiaries to benefits under the Plan shall be determined by the
Corporation or such party as it shall designate under the Plan, and
any claim for such benefits shall be considered and reviewed under
the procedures set out in the Plan.
(c) The Corporation may make payment of benefits directly
to Plan participants or their beneficiaries as they become due under
the terms of the Plan. The Corporation shall notify the Trustee of
its decision to make payment of benefits directly prior to the time
amounts are payable to participants or their beneficiaries. In
addition, if the principal of the Trust, and any earnings thereon,
are not sufficient to make payments of benefits in accordance with
the terms of the Plan, the Corporation shall make the balance of each
such payment as it falls due. The Trustee shall notify the Corporation
if principal and earnings are not sufficient.
Section 3
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Trustee Responsibility Regarding Payments
to Trust Beneficiary When Corporation is Insolvent
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(a) The Trustee shall cease payment of benefits to
Plan participants and their beneficiaries if the Corporation is
Insolvent. The Corporation shall be considered "Insolvent" for
purposes of this Trust Agreement if (i) the Corporation is unable
to pay its debts as they become due; or (ii) the Corporation is
subject to a pending proceeding as a debtor under the United States
Bankruptcy Code.
(b) At all times during the continuance of this Trust,
as provided in Section 1(d) hereof, the principal and income of the
Trust shall be subject to claims of general creditors of the
Corporation under federal and state law as set forth below.
(i) The Board of Directors and the President
of the Corporation shall have the duty to inform the Trustee in
writing of the Corporation's Insolvency. If a person claiming to
be a creditor of the Corporation alleges in writing to the Trustee
that the Corporation has become Insolvent, the Trustee shall
determine whether the Corporation is Insolvent and, pending such
determination, the Trustee shall discontinue payment of benefits
to Plan participants or their beneficiaries.
(ii) Unless the Trustee has actual knowledge
of the Corporation's Insolvency, or has received notice from the
Corporation or a person claiming to be a creditor alleging that the
Corporation is Insolvent, the Trustee shall have no duty to inquire
whether the Corporation is Insolvent. The Trustee may in all
events rely on such evidence concerning the Corporation's solvency
as may be furnished to the Trustee and that provides the Trustee
with a reasonable basis for making a determination concerning the
Corporation's solvency.
(iii) If at any time the Trustee has determined
that the Corporation is Insolvent, the Trustee shall discontinue
payments to Plan participants or their beneficiaries and shall
hold the assets of the Trust for the benefit of the Corporation's
general creditors. Nothing in the Trust Agreement shall in any way
diminish any rights of Plan participants or their beneficiaries to
pursue their rights as general creditors of the Corporation with
respect to benefits due under the Plan or otherwise.
(iv) The Trustee shall resume the payment of
benefits to Plan participants or their beneficiaries in accordance
with Section 2 of this Trust Agreement only after the Trustee has
determined that the Corporation 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 Plan participants or their beneficiaries
under the terms of the Plan for the period of such discontinuance,
less the aggregate amount of any payments made to Plan participants
or their beneficiaries by the Corporation in lieu of the payments
provided for hereunder during any such period of discontinuance.
Section 4
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Payments to the Corporation
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Except as provided in Section 3 hereof, after the Trust has
become irrevocable, the Corporation shall have no right or power to
direct the Trustee to return to the Corporation or to divert to others
any of the Trust assets before all payment of benefits have been made
to Plan participants and their beneficiaries pursuant to the terms of
the Plan.
Section 5
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Investment Authority
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(a) It is intended that a portion of the assets of the
Trust will be invested by the Trustee in securities (including stock
or rights to acquire stock) or obligations issued by the Corporation
(the "Corporation Stock"). All rights associated with assets of the
Trust shall be exercised by the Trustee or the person designated by
the Trustee, including, but not limited to, the voting rights with
respect to Corporation Stock. The Corporation shall have the right
from time to time in its sole discretion, to substitute assets of
equal fair market value for any asset held by the Trust. This right
is exercisable by the Corporation in a nonfiduciary capacity without
the approval or consent of any person in a fiduciary capacity.
(b) The Trustee may purchase and sell Corporation Stock
for the Plan wherever the Corporation Stock is traded, in the
over-the-counter market or in negotiated transactions. The Trustee
shall purchase and sell Corporation Stock for the Plan on such terms
as to price, delivery and otherwise as the Trustee determines in its
sole discretion. It is the intent of the Corporation and the Trustee
that to the extent Corporation Stock is to be purchased for the Plan
in the open market, the Trustee shall cause each such purchase to be
made by an entity (the "Purchasing Agent") which qualifies as an "agent
independent of the issuer," as that term is used in Rule 10b-18
promulgated under the Securities Exchange Act of 1934, as amended.
No Purchasing Agent may be an affiliate of the Corporation. In
addition, neither the Corporation nor any of its subsidiaries or
affiliates (including the Trustee) nor the Plan Administrator (as
defined in the Plan) may exercise any direct or indirect control or
influence over the times when, or the prices at which, shares of
Corporation Stock are purchased by the Purchasing Agent, the amount
of Corporation Stock to be purchased, the manner in which purchases
are made or the selection of the broker or dealer (other than the
Purchasing Agent itself) through whom the purchases are executed.
(c) With respect to the portion of the assets of the
Trust which are not invested in Corporation Stock, the Trustee shall
invest and reinvest such assets and keep them invested, without
distinction between principal and income, in three (3) year
certificates of deposit or an equivalent deposit account.
In making such investments, the Trustee shall not be restricted
from investing assets of the Trust in certificates of deposit or
other deposit accounts offered by the Trustee.
Section 6
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Disposition of Income
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During the term of this Trust, all income received by the
Trust, net of any expenses and taxes paid from the Trust as provided
in this Trust Agreement, shall be accumulated and reinvested.
Section 7
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Accounting by the Trustee
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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 Corporation and the Trustee.
Within 90 days following the close of each calendar year and within
90 days after the removal or resignation of the Trustee, the Trustee
shall deliver to the Corporation 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
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Responsibility of the Trustee
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(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 Corporation which is contemplated by, and in
conformity with, the terms of the Plan or this Trust and is given in
writing by the Corporation. In the event of a dispute between the
Corporation 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 Corporation 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 Corporation does not pay such costs, expenses and liabilities
in a reasonably timely manner, the Trustee may obtain payment from the
Trust.
(c) The Trustee may consult with legal counsel (who
may also be counsel for the Corporation 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 Code.
Section 9
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Compensation and Expenses of the Trustee
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The Corporation shall pay all administrative expenses and
the Trustee's fees and expenses. If not so paid, the fees and
expenses shall be paid from the Trust. The Trustee's fees shall be
mutually agreed to between the Corporation and the Trustee.
Section 10
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Resignation and Removal of the Trustee
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(a) The Trustee may resign at any time by written
notice to the Corporation, which shall be effective 30 days after
receipt of such notice unless the Corporation and the Trustee agree
otherwise.
(b) The Trustee may be removed by the Corporation on 30
days' notice or upon shorter notice accepted by the Trustee.
(c) Upon resignation or removal of the Trustee and
appointment of a successor Trustee, all assets shall subsequently be
transferred to the successor Trustee. The transfer shall be completed
within 60 days after receipt of notice of resignation, removal or
transfer, unless the Corporation extends the 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.
(e) Upon resignation or removal of the Trustee and
appointment of a successor Trustee, all assets shall subsequently be
transferred to the successor Trustee. The transfer shall be completed
within 60 days after receipt of notice of resignation, removal or
transfer, unless the Corporation extends the time limit.
Section 11
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Appointment of Successor
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(a) If the Trustee resigns or is removed in accordance with
Section 10(a) or (b) hereof, the Corporation 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 Corporation or
the successor Trustee to evidence the transfer.
(b) The successor Trustee need not examine the records and
acts of any prior Trustee and may retain or dispose of existing Trust
assets, subject to Sections 7 and 8 hereof. The successor Trustee shall
not be responsible for and the Corporation 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.
Section 12
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Amendment or Termination
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(a) This Trust Agreement may be amended by a written
instrument executed by the Trustee and the Corporation. Notwithstanding
the foregoing, no such amendment shall conflict with the terms of the
Plan or shall make the Trust revocable.
(b) The Trust shall not terminate until the date on which
Plan participants and their beneficiaries are no longer entitled to
benefits pursuant to the terms of the Plan. Upon termination of the
Trust, any assets remaining in the Trust shall be returned to the
Corporation.
Section 13
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Miscellaneous
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(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 Plan participants and their
beneficiaries under this Trust Agreement may not be anticipated,
assigned (either at law or in equity), alienated, pledged,
encumbered or subjected to attachment, garnishment, levy, execution
or other legal or equitable process.
(c) This Trust Agreement shall be governed by and construed
in accordance with the laws of the State of Ohio.
Section 14
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Effective Date
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The effective date of this Trust Agreement shall be
January 2, 1998.
IN WITNESS WHEREOF, the undersigned authorized officers
of the parties have executed this Trust Agreement as of the date
first above written, to be effective as of the date specified in
Section 14 hereof.
PEOPLES BANCORP INC.
By:__________________________________
Its:_________________________________
THE PEOPLES BANKING AND TRUST COMPANY
By:__________________________________
Its:_________________________________
