SECOND MASTER TRUST AGREEMENT
AGREEMENT made as of the 19th day of July, 1983 between The Coastal
Corporation, a Delaware corporation (hereinafter referred to as the "Company")
and the individuals who have executed this document as Trustees (hereinafter
referred to as the "Trustees").
W I T N E S S E T H
WHEREAS, the Company desires to establish an additional master trust known
as "The Coastal Corporation Second Pension Trust" (hereinafter referred to as
the "Second Master Trust"), which will serve as an additional funding medium for
the "Pension Plan for Employees of The Coastal Corporation" (the "Coastal
Plan"); and
WHEREAS, a separate additional master retirement trust with the Trustees
similar to the Second Master Trust ("Related Trusts") has been adopted by the
employee pension plans of the Company's subsidiaries and/or affiliates listed on
the Schedule of Commingled Plans (the "Related Plans") annexed hereto; and
WHEREAS, certain assets of the Coastal Plan and Related Plans are currently
in a trust fund (the "Master Trust") held by Bankers Trust Company as Trustee
(the "Master Trustee"), pursuant to an agreement (the "Master Trust Agreement")
dated as of January 1, 1982 between the Company and the Master Trustee;
NOW, THEREFORE, in consideration of the premises, the Company and the
Trustees do hereby declare and agree each with the other that the Second Master
Trust is hereby established as follows:
1. The Trustees shall appoint a custodian (hereinafter referred to as the
"Custodian") to accept and hold, as Custodian, as hereinafter provided such sums
of money and other property acceptable to the Trustees as shall from time to
time be paid or delivered to the Second Master Trust (including, but not limited
to, any money or other property which, upon direction of the Company, may be
transferred to the Second Master Trust from the Master Trust) and such income,
increments and accruals thereon as may occur from time to time. All such monkey
and other property and all investments and reinvestments made therewith or
proceeds thereof and all income and increments thereon, less the payments which
at the time of reference shall have been made by the Custodian at the direction
of the Trustees as authorized herein, are sometimes referred to herein as the
"Fund". The Fund shall be held by the Custodian and dealt with in accordance
with the express provisions of this Agreement. No bond shall be required of the
Custodian unless required by law.
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The Custodian shall have no authority with respect to investment,
reinvestment, retention, sale or other disposition of any assets of the Fund
except to act as agent if so authorized by the Trustees.
Assets of the Coastal Plan and the Related Plans may be commingled under
the Second Master Trust for purposes of common investment. However, the
management and control of such commingled assets shall be exercised only
pursuant to the provisions of the Second Master Trust and the Related Trusts,
respectively.
2. The Trustees are directed and authorized (a) to invest and reinvest the
Fund, through any agent, which agent may be the Custodian, as hereinafter
prescribed, (b) to direct the Custodian to pay monies and make distributions
from the Fund on the order of the Trustees or such person or persons as may be
designated in writing by the Trustees (such person or persons being hereinafter
referred to as the "Fiduciary"), for the purpose of transfer to the Master Trust
or distributing to participants, retired participants and their beneficiaries
the benefits due them, including payment to any insurance company for the
purpose of providing such benefits, and (c) to pay the expenses of the Fund as
hereinafter provided.
Notwithstanding anything in this Agreement to the contrary, no part of the
corpus or income of the Fund shall be used for or diverted to purposes other
than the exclusive benefit of the participants, retired participants or their
beneficiaries; provided, however, that the Custodian shall be entitled to assume
that any action by the Trustees, the Company, any of its subsidiaries or
affiliated companies, or the Fiduciary pursuant to any of the provisions of this
Agreement shall comply with the foregoing provision of this paragraph, and the
Custodian shall nob be liable in respect of any action they may take in good
faith pursuant thereto.
3. The Trustees shall invest and reinvest the Fund as provided herein, and
keep the Fund invested, without distinction between corpus and income, entirely
in common stock of the Company ("Common Stock"), and shall accept contributions
in the form of Common Stock (if any contribution to the Fund is received from
the Company in the form of treasury shares or authorized but previously unissued
shares of Common Stock); provided, however, that the Company shall inform the
Trustees periodically or at their request of the aggregate market value of plan
assets and the market value, if any, of Common Stock held by the Master Trust,
and in no event shall the Trustees make any purchases of Common Stock or accept
any contribution in the form of Common Stock if and to the extent that the then
aggregate market value of Common Stock held pursuant to the Fund and the Master
Trust would exceed ten percent of the then aggregate market value of the assets
of the Master Trust plus the Fund.
Notwithstanding anything in this Agreement to the contrary, pending the
purchases of Common Stock or pending any payment or distribution from the Fund
as provided in this
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Agreement, the Trustees may temporarily invest all or any part of the Fund
in interest-bearing accounts or commingled accounts maintained by a bank or
banks, or in such short-term debt instruments as they, in their sole discretion,
deem appropriate, or in any regulated fund invested in short-term debt
instruments. Subject to the foregoing provisions of this Article 3, the Trustees
shall reinvest all interest, dividends and other income earned by the Fund in
Common Stock.
4. Subject to the provisions of Article 3 hereof, the Trustees are
authorized and empowered:
(a) to sell, exchange, convey, transfer or otherwise dispose
of any securities or other property held by the Fund, by private
contract or at public auction. No person dealing with the Trustees or
Custodian shall be bound to see to the validity, expediency or
propriety of any such sale or other disposition;
(b) to vote any stock, bonds or other securities; to give
general or special proxies or powers of attorney with or without power
of substitution; to exercise any conversion privileges, subscription
rights or other options, and to make any payments incidental thereto;
to oppose, or to consent to, or otherwise participate in, corporate
reorganizations or other changes affecting corporate securities, and
to delegate discretionary powers, and to pay any assessments or
charges in connection therewith; and generally to exercise any of the
powers of an owner with respect to stocks, bonds, securities or other
property held as part of the Fund;
(c) to appoint a Custodian to hold assets of the Fund, which
Custodian is to cause any securities or other property held as part of
the Fund to be registered in the name of the Custodian or in the name
of one or more nominees of the Custodian or to hold any investments in
bearer form, but the books and records of the Custodian shall at all
times show that all such investments are part of the Fund;
(d) to borrow or raise money for the purposes of the Coastal
Plan in such amount and upon such terms and conditions as they shall
deem advisable and, for any sum so borrowed, to issue their promissory
note as Trustees and to secure the repayment thereof by pledging all,
or any part, of the Fund; and no person lending money to the Trustees
shall be bound to see to the application of the money lent or to
inquire into the validity, expediency or propriety of any such
borrowing;
(e) to keep such portion of the fund in cash or cash balances
as the Trustees may, from time to time, deem to be in the best
interest of the Coastal Plan, without liability for interest thereon
and, without affecting the generality of the foregoing, to keep such
portion of the Fund in cash or cash balances as may be specified from
time to time in a written request of the Fiduciary to meet
contemplated requisitions or orders of the Fiduciary;
(f) to have the Custodian accept and retain for such time as
the Trustee may seem advisable any securities or other property
received or acceptable by them as Trustees hereunder, whether or not
such securities or other property would normally be purchased as
investments hereunder;
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(g) to appoint such accountants, actuaries, legal counsel,
investment advisors, specialists and other persons as they may deem
necessary or advisable in connection with the furtherance of their
responsibilities hereunder. The Trustees shall be entitled to rely
conclusively upon, and shall be fully protected in any action taken by
them in good faith in reliance upon, any opinions or reports which
shall be furnished to them by any such accountant, actuary, counsel,
advisor, specialist or other person;
(h) to appoint a bank or bank's trust company or trust
companies as Custodian, and to enter into and execute an agreement
with such Custodian setting forth the duties and responsibilities of
such Custodian with respect to the assets of the Fund; and
(i) to do all acts which they may deem necessary or proper and
to exercise any and all powers of the Trustees under this Agreement
under such terms and conditions as they deem to be for the best
interests of the Fund.
5. All expenses attendant to the management, control, and investment of the
assets of the Fund, including expenses arising out of any investment management
agreement or custodian agreement, expenses incurred by the Trustees hereunder,
and compensation for agents and for legal services of counsel, and expenses
incident there to, and the Trustees' compensation, if any (which, while such
compensation may be paid from the Fund, shall be in such amounts as may be
agreed upon in writing by the Company and the Trustees), and all other proper
charges and disbursements of the Trustees, including all proper taxes of any and
all kinds whatsoever that may be levied or assessed under existing or future
laws of any jurisdiction upon or in respect of the trust hereby created or the
Fund or any money, property or securities forming a part thereof, shall be paid
by the Trustees out of the Fund.
6. The Trustees may consult with legal counsel approved by the Company (who
may be counsel to the Company) concerning any question which may arise with
reference to their duties under this Agreement and the opinion of such counsel
shall be full and complete protection in respect of any action taken or suffered
by the Trustees hereunder in good faith and in accordance with the opinion of
such counsel.
7. The Custodian shall keep accurate and detailed accounts of all
investments, receipts and disbursements and other transactions hereunder and all
accounts, books and records relating thereto shall be open at all reasonable
times to inspection and audit by the Trustees, the Fiduciary or any person
designated by the Company. As soon as practicable after the close of the
business of each year, the Trustees shall certify in writing to the Company or
shall cause the Custodian to certify in writing to the Company the market value
of the Fund as of the close of business on the last business day of such year.
Within ninety days following the close of each plan year of the Coastal Plan and
within ninety days after the removal or resignation of any Custodian or
termination of the trust as provided herein, the Custodian shall file with the
Company a certified written report setting forth all investments, receipts and
disbursements, and other transactions
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effected by them during such year or during the period from the close of
such plan year to the date of such removal, resignation or termination. Except
as provided to the contrary by Section 413(a) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), upon the expiration of one hundred
fifty days from the date of filing such annual or other account, the Trustees
and Custodian shall be forever released and discharged from all liability and
accountability to anyone with respect to the propriety of their acts and
transactions shown in such account, except with respect to any, such acts or
transactions as to which the Company shall file with the Custodian or Trustees
written objections within such one hundred fifty day period.
The Company, as administrator of the Coastal Plan, shall be responsible for
preparing and filing any and all federal, state and local tax and other returns
that may be necessary in connection with the Fund.
Neither the Company, any participating subsidiary or affiliated company,
nor the Fiduciary shall have the right to demand or be entitled to any further
or different accounting by the Custodian or Trustees. The foregoing, however,
shall not preclude the Custodian or Trustees from having its account settled by
a court of competent jurisdiction.
The Company shall furnish or cause to be furnished to the Trustees, as soon
as practicable after their transmittal to the Company, such statements of the
assets and liabilities of the Master Trust as may be furnished to the Company by
the Master Trustee pursuant to the Master Trust Agreement. In furtherance of
their responsibilities hereunder, the Trustees shall be allowed to inspect the
books of account of the Master Trustee upon request at any reasonable time
during business hours.
8. The Trustees may act by majority vote at a meeting or unanimously in
writing without a meeting. Any Trustee may participate at a meeting by means of
conference telephone or similar communications equipment. Notwithstanding the
foregoing: (a) instructions for the transfer of money and property to the Master
Trust may be signed by any one Trustee with the same force and effect as if
signed by all Trustees then acting hereunder, and (b) the Trustees may by
written authorization empower any one of them to individually execute any other
document or documents on behalf of the Trustees, which authorization shall
remain in effect until revoked by any Trustee.
9. (a) The Trustees shall discharge their duties with respect to the
Coastal Plan and the Fund solely in the interest of the participants and their
beneficiaries and
(1) for the exclusive purpose of providing benefits to
participants and their beneficiaries and defraying reasonable expenses
of administering the Coastal Plan;
(2) with the care, skill, prudence and diligence under the
circumstances then prevailing that a prudent man, 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;
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(3) after taking into account the investment of assets held
pursuant to the Coastal Plan including assets held pursuant to the
Master Trust, by diversifying the investments of the Coastal Plan so
as to minimize the risk of large losses, unless under the
circumstances it is clearly prudent not to do so; and
(4) in accordance with the documents and instruments governing
the Coastal Plan insofar as such documents and instruments are
consistent with the provisions of ERISA.
(b) Except as provided in the succeeding sentence, the
Trustees shall not be liable with respect to any act or omission of the
Master Trust in connection with its responsibilities under the Master Trust
Agreement. No Trustee shall be liable for any breach of fiduciary responsibility
under ERISA by any other fiduciary with respect to the Coastal Plan unless (i)
he participates knowingly in, or knowingly undertakes to conceal, an act or
omission of such fiduciary, knowing such act or omission to be such a breach, or
(ii) by his failure to comply with the provisions of paragraph (a) of this
Article 9, he has enabled such other fiduciary to commit such a breach, or (iii)
he has knowledge of such a breach by such other fiduciary and has not made
reasonable efforts under the circumstances to remedy such breach.
10. Any Trustee may be removed by the Company at any time upon notice in
writing to the Trustees. A Trustee may resign at any time upon thirty days
notice in writing to the Company. Upon such removal or resignation of a Trustee,
or upon the death or disability of a Trustee, the Board of Directors of the
Company (the "Board") shall within thirty days appoint and designate a successor
trustee, who shall have the same powers and duties as those conferred upon the
Trustees hereunder. The Company may appoint one or more additional Trustees at
any time who shall have the same powers as those conferred upon the Trustees
hereunder.
11. Any action by the Board pursuant to any of the provisions of this
Agreement shall be evidenced by a resolution of the Board certified to the
Trustees over the signature of the Secretary or Assistant Secretary of the
Company under its corporate seal, and the Trustees shall be fully protected in
acting in accordance with such resolution so certified to it. All requests,
directions, requisitions for monies, certifications, and instructions by the
Trustees or Fiduciary to the Custodian shall be in writing, signed by the
Trustees or Fiduciary, and the Custodian shall act and shall be fully protected
in acting in accordance with such requests, directions, requisitions,
certifications and instructions. The Trustees or Fiduciary need not specify the
application to be made of any monies, and the Custodian shall be fully protected
in making payments of monies upon requisitions of the Trustees or Fiduciary and
shall be charged with no responsibility whatsoever respecting the application of
such monies or for the administration of the Coastal Plan. The Trustees shall
promptly furnish to the Custodian certificates evidencing the appointment and
termination of the Fiduciary, together with specimen signatures of such
Fiduciary, and for all purposes hereunder the Custodian shall be conclusively
entitled to rely upon such certificates as evidence of the identity and
authority of the person or persons as disclosed thereby.
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12. The Company reserves the right at any time (1) to modify or amend in
whole or in part, by written agreement with the Trustees, any or all of the
provisions of this Agreement, or (2) to terminate this Agreement upon notice in
writing to the Trustees; and the Company hereby covenants and agrees with the
Trustees that any such termination, modification, or amendment shall not permit
any part of the corpus or income of the Fund to be used for, or diverted to,
purposes other than for the exclusive benefit of participants of the Coastal
Plan and their beneficiaries. However, if a contribution is made by mistake of
fact, this Agreement shall not prohibit the return of such contribution within
one year after the payment of such contribution, or if a contribution is
conditional on qualification of any of the Coastal Plan under Section 401(a) of
the Internal Revenue Code of 1954, as amended, and if any such plan does not so
qualify, this Agreement shall not prohibit the return of such contribution
within one year after the date of qualification of such plan, or if a
contribution is conditioned upon its deductibility under Section 404 of the
Internal Revenue Code of 1954, as amended, then, to the extent such deduction is
disallowed, this Agreement shall not prohibit the return of such contribution
within one year after the disallowance of such deduction. In the event of
termination of the trust created hereunder, all cash, securities and other
property then constituting the Fund, less any amounts constituting charges and
expenses properly payable from the Fund, shall be paid over or delivered by the
Trustees to the Master Trust, subject to the provisions of ERISA. In making such
or any other payments or deliveries to the Master Trust, however, the Trustees
shall, unless otherwise prescribed by law, ruling or regulation, have no duty to
determine whether or not such payments constitute any use or diversion of the
Fund for purposes other than the payment or provision for the payment of the
retirement benefits and the cash payments provided for in the Coastal Plan.
13. The Company, to the extent legally permissible, shall indemnify the
Trustees, the Fiduciary, and the Custodian, and each of them, against all
liabilities and expenses reasonably incurred in connection with the defense or
disposition or any action, suit, claim or other proceeding, either civil or
criminal, commenced or threatened, by reason of such Trustee, Fiduciary or
Custodian having served in such fiduciary capacity, except with respect to any
matter as to which such Trustee, Fiduciary or Custodian shall have been
adjudicated to have been guilty of gross negligence or willful misconduct. Such
indemnification shall be made only to the extent that liabilities and expenses
are not covered by insurance policies.
14. The Trustees, by joining in the execution of this Agreement, hereby
signify their acceptance of the trust created hereunder, their investment
management and fiduciary capacity, and agreement to the allocation of fiduciary
responsibilities, obligations and duties contained in this Agreement.
15. This Agreement shall be construed and enforced according to the laws of
the State of Texas and all provisions hereof shall be administered according to
the laws of said state, except as said laws are superceded by ERISA.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date indicated but to be effective as of the date first above written.
ATTEST: THE COASTAL CORPORATION
(Corporate Seal)
_____________________________ By: _______________________________________
Xxxxxx X. X'Xxxxx Xxxxx X. Xxxx Date
Vice President and Senior Vice President
Assistant Secretary
ATTEST:
_____________________________ _______________________________________
Xxxxxxx X. X'Xxxx M. T. Xxxxxx, Trustee Date
ATTEST:
_____________________________ _______________________________________
Xxxxx X. Xxxxxx Xxxxx X. Page, Trustee Date
ATTEST:
_____________________________ ______________________________________
Xxxxx X. Xxxx Xxxxxxx X. Xxxxxxxx, Trustee Date
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SCHEDULE OF COMMINGLED PLANS
1. Derby Refining Company Pension Plan.
2. SUFCo Retirement Plan
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