HEI Exhibit 99.1
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TRUST AGREEMENT
BETWEEN
HAWAIIAN ELECTRIC INDUSTRIES, INC.
AND
FIDELITY MANAGEMENT TRUST COMPANY
HAWAIIAN ELECTRIC INDUSTRIES
RETIREMENT SAVINGS PLAN
DATED AS OF FEBRUARY 1, 2000
____________________________________________
TABLE OF CONTENTS
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Section Page
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1 Trust........................................................... 2
2 Exclusive Benefit and Reversion of Sponsor Contributions........ 2
3 Disbursements................................................... 2
4 Investment of Trust............................................. 3
(a) Selection of Investment Options
(b) Available Investment Options
(c) Participant Direction
(d) Sponsor Stock
(e) ASB Money Market Account Operating Procedures
(f) Execution of Trades
(g) Mutual Fund Voting
(h) Limitation of Liability; Reliance of Trustee on Directions
(i) Trustee Powers
(j) Loans
(k) Non-Fidelity Mutual Funds
5 Recordkeeping to be Performed................................... 13
(a) General
(b) Accounts
(c) Inspection and Audit
(d) Necessary Information
(e) Returns, Reports and Information
6 Compensation and Expenses....................................... 14
7 Directions...................................................... 14
(a) Identity of Administrator and Named Fiduciary
(b) Directions from Administrator
(c) Co-Fiduciary Liability
(d) Indemnification of Trustee
(e) Indemnification of Sponsor
(f) Survival
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TABLE OF CONTENTS
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(Continued)
Section Page
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8 Resignation or Removal of Trustee................................. 15
(a) Resignation
(b) Removal
9 Successor Trustee................................................. 15
(a) Appointment
(b) Acceptance
(c) Corporate Action
10 Termination....................................................... 16
11 Resignation, Removal, and Termination Notices..................... 16
12 Duration.......................................................... 16
13 Amendment or Modification......................................... 16
14 General........................................................... 16
(a) Performance by Trustee, its Agents or Affiliates
(b) Entire Agreement
(c) Waiver
(d) Successors and Assigns
(e) Partial Invalidity
(f) Section Headings
15 Governing Law..................................................... 17
(a) Massachusetts Law Controls
(b) Trust Agreement Controls
Schedules
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A Administrative Services...................................... 19
B Fee Schedule................................................. 21
C Investment Options........................................... 22
D Authorization Letter......................................... 23
E IRS Determination Letter..................................... 25
F Telephone Exchange Guidelines................................ 28
G Operating Procedures Agreement - ASB Money Market Account.... 29
H Operating Procedures for Non-Fidelity Mutual Funds........... 33
I Plan Sponsor Webstation Agreement............................ 35
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TRUST AGREEMENT, dated as of the 1st day of February, 2000, between HAWAIIAN
ELECTRIC INDUSTRIES, INC., a Hawaii corporation, having an office at 000
Xxxxxxxx Xxxxxx, Xxxxxxxx, Xxxxxx 00000 (the "Sponsor"), and FIDELITY
MANAGEMENT TRUST COMPANY, a Massachusetts trust company, having an office at 00
Xxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 (the "Trustee").
WITNESSETH:
WHEREAS, the Sponsor is the sponsor of the Hawaiian Electric Industries
Retirement Savings Plan, a defined contribution, 401(k) plan (the "Plan"); and
WHEREAS, the Sponsor and the Trustee have heretofore entered into a trust
agreement (the "Trust Agreement") establishing a trust to hold and invest Plan
assets for the exclusive benefit of participants in the Plan and their
beneficiaries; and
WHEREAS, the Sponsor and the Trustee wish to restate the Trust Agreement in
its entirety effective February 1, 2000; and
WHEREAS, the Sponsor has established the Hawaiian Electric Industries, Inc.
Pension Investment Committee (the "PIC") and appointed it "named fiduciary" and
"administrator" of the Plan, as defined in sections 402(a) and 3(16)(A),
respectively, of the Employee Retirement Income Security Act of 1974, as
amended, ("ERISA"); and
WHEREAS, the PIC has established an administrative committee (the
"Administrative Committee") to oversee the day-to-day administration of the
Plan; and
WHEREAS, the Trustee is a nondiscretionary trustee, subject to the direction
of the PIC with respect to the investment options available under the Plan and
to the direction of participants and beneficiaries with respect to investments
in the participants' individual accounts; and
WHEREAS, the Plan is intended to be a plan described in section 404(c) of
ERISA, under which the fiduciaries of the Plan shall not be liable for any loss,
or with respect to any breach of Part 4, Title I of ERISA, that is the direct
and necessary result of a participant's or beneficiary's exercise of control
over the investments in his or her individual account; and
WHEREAS, the Sponsor wishes to have the Trustee continue to perform certain
ministerial recordkeeping and administrative functions with respect to the Plan
in a nonfiduciary capacity; and
WHEREAS, the Trustee wishes to continue to serve as a directed trustee with
respect to Plan investments and to perform recordkeeping and administrative
services for the Plan if the services are purely ministerial in nature and are
provided within a framework of administration (including Plan policies,
interpretations, rules, practices, and procedures) provided in writing by the
Sponsor, the PIC, or the Administrative Committee.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants and agreements set forth below, the Sponsor and the Trustee agree as
follows:
Section 1. Trust. The Sponsor hereby reestablishes the Hawaiian Electric
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Industries Retirement Savings Plan Trust (the "Trust") with the Trustee. The
Trust consists of such assets held by the Trustee for the Plan at 12:00 a.m. on
February 1, 2000, and shall include such additional sums of money, HEI common
stock and other property acceptable to the Trustee in its sole discretion as
shall from time to time be delivered to the Trustee under the Plan, all
investments made therewith and proceeds thereof, and all earnings and profits
thereon, less the payments that are made by the Trustee as provided herein,
without distinction between principal and income. The Trustee hereby accepts
the reestablished Trust on the terms and conditions set forth in this Agreement.
In accepting this Trust, the Trustee shall be accountable for the assets held
and received by it, subject to the terms and conditions of this Agreement.
Section 2. Exclusive Benefit and Reversion of Sponsor Contributions.
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(a) Except as provided in paragraphs (b), (c), and (d) of this Section,
no part of the Trust may be used for, or diverted to, purposes other than the
exclusive benefit of the participants in the Plan or their beneficiaries prior
to the satisfaction of all liabilities with respect to the participants and
their beneficiaries.
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(b) In the case of any contribution made by the Sponsor by a mistake of
fact, the Sponsor may direct the Trustee to return to the Sponsor that portion
of the contribution that was due to the mistake of fact within one year after
the contribution.
(c) In the case of any portion of a contribution made by the Sponsor and
disallowed by the Internal Revenue Service as a deduction under section 404 of
the Internal Revenue Code of 1986, the Sponsor may direct the Trustee to return
to the Sponsor that portion of the contribution within one year after the
Internal Revenue Service disallows the deduction in writing.
(d) Earnings attributable to the contributions returnable under
paragraph (b) or (c) shall not be returned to the Sponsor, and any losses
attributable to those contributions shall reduce the amount returned; provided
that any losses shall first be netted against any earnings attributable to those
contributions prior to being used to reduce the amount returned.
Section 3. Disbursements.
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(a) The Trustee shall make disbursements in the amounts and in the
manner that the Administrator directs from time to time in writing. The Trustee
shall have no responsibility to ascertain any direction's compliance with the
terms of the Plan or of any applicable law or the direction's effect for tax
purposes or otherwise; nor shall the Trustee have any responsibility to see to
the application of any disbursement.
(b) The Trustee shall not be required to make any disbursement in excess
of the net realizable value of the assets of the Trust at the time of the
disbursement. The Trustee shall not be required to make any disbursement in
cash unless the Administrator has provided a written direction as to the assets
to be converted to cash for the purpose of making the disbursement.
Section 4. Investment of Trust.
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(a) Selection of Investment Options. Except as otherwise provided
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herein, the Trustee shall have no responsibility for the selection of investment
options under the Trust and shall not render investment advice to any person in
connection with the selection of such options.
(b) Available Investment Options. The PIC shall direct the Trustee as to
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what investment options Plan participants may invest in as set forth in Schedule
"C", subject to the following limitations. The PIC may determine to offer as
investment options only (i) securities issued by the investment companies
advised by Fidelity Management & Research Company ("Fidelity Mutual Funds") and
securities issued by registered investment companies not advised by Fidelity
Management & Research Company ("Non-Fidelity Mutual Funds") (collectively,
"Mutual Funds"), (ii) equity securities issued by the Sponsor or an affiliate
which are publicly-traded and which are "qualifying employer securities"
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within the meaning of section 407(d)(5) of ERISA ("Sponsor Stock"), (iii) a
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money market account sponsored by American Savings Bank, F.S.B. ("ASB MMA"),
(iv) notes evidencing loans to Plan participants in accordance with the terms of
the Plan's loan procedures, (v) guaranteed investment contracts chosen by the
Trustee, and (vi) collective investment funds maintained by the Trustee for
qualified plans; provided, however, that the Trustee shall be considered a
fiduciary with investment discretion only with respect to Plan assets that are
invested in guaranteed investment contracts chosen by the Trustee or in
collective investment funds maintained by the Trustee for qualified plans.
(c) Participant Direction. Each Plan participant or the participant's
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beneficiary shall direct the Trustee in which investment option(s) to invest the
assets in the participant's individual account. Such directions may be made by
Plan participants by use of the telephone exchange system maintained for such
purposes by the Trustee or its agent in accordance with written Telephone
Exchange Guidelines as revised from time to time. Except to the extent of its
negligence, the Trustee shall be fully protected in following the directions
received from a participant or beneficiary through the telephone exchange
service with respect to the participant's individual account. In the event that
the Trustee fails to receive a proper direction from a participant or
beneficiary, the assets shall be invested in the investment option set forth on
Schedule "C", until the Trustee receives a proper direction from such
participant or beneficiary. Furthermore, if any assets, allocable to
participants accounts hereunder are received from a predecessor trustee, such
assets shall be invested in the Fidelity Retirement Money Market Portfolio until
the Trustee receives a full reconciliation of such assets from the predecessor
trustee, at which time such assets shall then be invested pursuant to proper
directions received from the PIC, participant or beneficiary, as the case may
be.
(d) Sponsor Stock. Trust investments in the HEI Common Stock Fund shall
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consist of shares of HEI common stock and short-term liquid investments. The
cash will be invested via the Fidelity Institutional Cash Portfolios: Money
Market: Class I or such other Mutual Fund or commingled money market pool as
agreed to by the Sponsor or the PIC and the Trustee. To satisfy the HEI Common
Stock Fund's cash needs for participant-directed distributions and exchanges, a
target range for cash shall be maintained in the HEI Common Stock Fund. Such
target range is currently 2%, plus/minus 0.2%, and may be changed as agreed to
in writing by the Sponsor or the PIC and the Trustee. The Trustee is responsible
for ensuring that the actual cash held in the HEI Common Stock Fund falls within
the agreed upon range. Each participant's proportional interest in the HEI
Common Stock Fund shall be measured in units of participation, rather than
shares of HEI common stock. Such units shall represent a proportionate interest
in all of the assets of the HEI Common Stock Fund, which includes shares of HEI
common stock, short-term investments, money market mutual fund shares, interest
in commingled money market pools and, at times, receivables for dividends and
interest and HEI common stock sold and payables for HEI common
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stock purchased. A Net Asset Value ("NAV") per unit for the HEI Common Stock
Fund will be determined daily for each unit outstanding of the HEI Common Stock
Fund. The Net Asset Value is calculated as follows: The daily NAV is equal to
the total net assets of the HEI Common Stock Fund divided by the outstanding
units of the HEI Common Stock Fund on the valuation date. The total net assets
of the HEI Common Stock Fund is equal to the number of underlying shares of HEI
common stock multiplied by the stock's closing price on the New York Stock
Exchange plus the market value of the Fund's interest in Fidelity Institutional
Cash Portfolio: Money Market: Class I ("FICAP"), short-term investments, money
market mutual funds and commingled money market pools; plus receivables for HEI
common stock sold; minus payables for HEI common stock purchased; plus dividends
accrued as of the ex-date on the underlying stock; plus interest accrued on the
FICAP or other component of the Fund. The total return on the HEI Common Stock
Fund shall include all accrued dividends and interest, realized and unrealized
gains/losses on the underlying investments. Dividends received by the HEI Common
Stock Fund shall be reinvested in the HEI Common Stock Fund. Investments in HEI
common stock shall be subject to the following limitations:
(i) Acquisition Limit. The Trust will be invested in HEI common
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stock to the extent necessary to comply with investment directions of
participants and beneficiaries under Section 4(c) of this Agreement.
(ii) Responsibility of PIC. The PIC is responsible for offering the
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HEI Common Stock Fund as an investment option under the Plan. The Trustee shall
not be liable for any loss, or by reason of any breach of fiduciary
responsibility, which arises from the directions of the PIC with respect to the
acquisition and holding of HEI common stock, unless the Trustee knew or should
have known that the actions to be taken under those directions would be
prohibited by ERISA or would be contrary to the terms of this Agreement.
(iii) Execution of Purchases and Sales.
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(A) Purchases and sales of HEI common stock shall be made on
the open market, on the date on which the Trustee receives from the Sponsor or
PIC in good order all information and documentation necessary to accurately
effect such purchases and sales and in the case of purchases, upon receipt of
the wire transfer necessary to make such purchases. If directed by the Sponsor
or PIC in writing the Trustee may purchase or sell HEI common stock from or to
the Sponsor. Exchanges of HEI common stock shall be made in accordance with the
Telephone Exchange Guidelines attached hereto as Schedule "F". The Trustee is
not obligated to buy or sell some or all of the shares of HEI common stock
required for the transaction in the following circumstances:
(1) If the Trustee is unable to determine the number of
shares required to be purchased or sold on such day; or
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(2) If the Trustee is unable to purchase or sell the
total number of shares required to be purchased or sold on such day as a result
of market conditions; or
(3) If the Trustee is prohibited by the Securities and
Exchange Commission, the New York Stock Exchange, or any other regulatory body
from purchasing or selling any or all of the shares required to be purchased or
sold on such day.
The Trustee may follow directions from the Sponsor or PIC to deviate from
the above purchase and sale procedures provided that such direction is made in
writing by the Sponsor or PIC.
(B) Purchases and Sales from or to Sponsor. If directed by the
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Sponsor or PIC in writing prior to the trading date, the Trustee may purchase or
sell HEI common stock from or to the Sponsor if the purchase or sale is for
adequate consideration (within the meaning of Section 3(18) of ERISA) and no
commission is charged. If Sponsor contributions or contributions made by the
Sponsor on behalf of the participants under the Plan are to be invested in the
HEI Common Stock Fund, the Sponsor may transfer HEI common stock in lieu of cash
to the Trust. In either case, the number of shares to be transferred will be
determined by dividing the total amount of HEI common stock to be purchased or
sold by the closing price of the HEI common stock on the New York Stock Exchange
on the trading date, rounded up to the nearest whole share.
(C) Use of an Affiliated Broker. The Sponsor hereby authorizes the
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Trustee to use Fidelity Capital Markets ("Capital Markets") to provide brokerage
services in connection with any purchase or sale of HEI common stock on the open
market in accordance with directions from Plan participants. Capital Markets
shall execute such directions directly or through its affiliate, National
Financial Services Company ("NFSC"). The provision of brokerage services shall
be subject to the following:
(1) As consideration for such brokerage services, the Sponsor
agrees that Capital Markets shall be entitled to remuneration under this
authorization provision in an amount of no more than three and one-fifth cents
($.032) commission on each share of HEI common stock purchased or sold. Any
change in such remuneration may be made only by a signed agreement between
Sponsor and Trustee.
(2) The Trustee will provide the Sponsor with a description of
Capital Markets' brokerage placement practices and a form by which the Sponsor
may terminate this direction to use a broker affiliated with the Trustee. The
Trustee will provide the Sponsor with this termination form annually, as well as
quarterly and annual reports which summarize all securities transaction-related
charges incurred by the Plan.
(3) Any successor organization of Capital Markets, through
reorganization, consolidation, merger or similar transactions, shall, upon
consumption of such transaction,
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become the successor broker in accordance with the terms of this authorization
provision, provided Capital Markets provides advance written notice of such
transfer to the Sponsor.
(4) The authorization by the Sponsor to use Capital Markets
for brokerage services as provided in this Section is terminable at will by the
Sponsor, without penalty to the Plan, upon receipt by the Trustee of a written
notice of termination.
(iv) Securities Law Reports. The Sponsor or PIC shall be
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responsible for filing all reports required under federal or state securities
laws with respect to the Trust's ownership of HEI common stock, including,
without limitation, any reports required under Sections 13 or 16 of the
Securities Exchange Act of 1934, and shall immediately notify the Trustee in
writing of any requirement to stop purchases or sales of HEI common stock
pending the filing of any report. The Trustee shall provide to the Sponsor or
PIC such information on the Trust's ownership of HEI common stock as the Sponsor
or PIC may reasonably request in order to comply with federal or state
securities laws.
(v) Voting and Tender Offers. Notwithstanding any other provision of
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this Agreement the provisions of this Section shall govern the voting and
tendering of HEI common stock. The Sponsor, after consultation with the
Trustee, shall provide and pay for all printing, mailing, tabulation and other
costs associated with the voting and tendering of HEI common stock.
(A) Voting.
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(1) When the Sponsor prepares for any annual or special
meeting, the Sponsor shall notify the Trustee thirty (30) days in advance of the
intended record date (or as soon as administratively feasible) and the Trustee
shall furnish to the Sponsor's transfer agent the name, address and social
security number of the participants holding units in the HEI Common Stock Fund,
and each participant's interest (in number of shares) as of the record date. The
Sponsor shall prepare proxy materials and voting instruction forms to be
distributed to participants holding an interest in the HEI Common Stock Fund.
The Sponsor shall provide the Trustee with a copy of any materials provided to
the participants and shall certify to the Trustee that the materials have been
mailed or otherwise sent to participants.
(2) Each participant with an interest in the HEI Common
Stock Fund shall have the right to direct the Trustee as to the manner in which
the Trustee is to vote (including not to vote) that number of shares of HEI
common stock reflecting such participant's proportional interest in the HEI
Common Stock Fund (both vested and unvested). Directions from a participant to
the Trustee concerning the voting of HEI common stock shall be communicated in
writing, or by mailgram or similar means. These directions shall be tabulated by
an affiliate of the Sponsor or any other organization deemed appropriate by the
Sponsor, held in confidence, in accordance with confidentiality procedures
established by the Sponsor or PIC. Upon its receipt of the directions, the
Sponsor or PIC shall provide the
7
Trustee with an omnibus proxy form and the Trustee shall vote the shares of HEI
common stock reflecting the participant's proportional interest in the HEI
Common Stock Fund as directed by the participant for HEIRS. The Trustee shall
vote shares of HEI common stock reflecting the participant's proportional
interest in the HEI Common Stock Fund for which it has received no direction
from the participant in the same proportion on each issue as it votes those
shares reflecting a participant's proportional interest in the HEI Common Stock
Fund for which it received voting directions from participants. The Sponsor or
PIC shall notify the Trustee of any situation regarding undue influence
including, but not limited to the following: tender offers, exchange offers,
contested board elections, mergers and the disposition of corporate assets. In
the event of any of the above mentioned actions, directions from a participant
concerning the voting of HEI common stock shall be communicated to the Trustee.
Directions from a participant to the Trustee concerning the voting of HEI common
stock shall be communicated in writing, or by mailgram or similar means. These
directions shall be held in confidence by the Trustee and shall not be divulged
to the Sponsor, or any officer or employee thereof, or any other person except
(i) as necessary to meet applicable legal requirements, (ii) in the case of any
contested proxy solicitation, as may be necessary to permit proper parties to
verify the propriety of proxies presented by any person and the results of the
voting, and (iii) in the event a shareholder has made a written comment on the
proxy form. In addition, the Trustee will provide the Sponsor as reasonably
requested by the Sponsor, periodic reports indicating the number of shares voted
and not voted. Upon its receipt of the directions, the Trustee shall vote the
shares of HEI common stock reflecting the participant's proportional interest in
the HEI Common Stock Fund as directed by the participant. The Trustee shall vote
shares of HEI common stock reflecting the participant's proportional interest in
the HEI Common Stock Fund for which it has received no direction from the
participant in the same proportion on each issue as it votes those shares
reflecting a participant's proportional interest in the HEI Common Stock Fund
for which it received voting directions from participants.
(3) The Trustee shall vote that number of shares of HEI common
stock not credited to participants' accounts in the same proportion on each
issue as it votes those shares credited to participants' accounts for which it
received voting directions from participants.
(B) Tender Offers.
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(1) Upon commencement of a tender offer for any securities held
in the Trust that are HEI common stock, the Sponsor shall notify each Plan
participant with an interest in such HEI common stock of the tender offer and
utilize its best efforts to timely distribute or cause to be distributed to the
participant the same information that is distributed to all shareholders of HEI
common stock in connection with the tender offer, and, after consulting with the
Trustee, shall provide and pay for a means by which the participant may direct
the Trustee whether or not to tender the HEI common stock
8
reflecting such participant's proportional interest in the HEI Common Stock Fund
(both vested and unvested). The Sponsor shall provide the Trustee with a copy of
any material provided to the participants and shall certify to the Trustee that
the materials have been mailed or otherwise sent to participants.
(2) Each participant shall have the right to direct the Trustee
to tender or not to tender some or all of the shares of HEI common stock
reflecting such participant's proportional interest in the HEI Common Stock Fund
(both vested and unvested). Directions from a participant to the Trustee
concerning the tender of HEI common stock shall be communicated in writing, or
by mailgram or such similar means as is agreed upon by the Trustee and the
Sponsor under the preceding paragraph. These directions shall be held in
confidence by the Trustee and shall not be divulged to the Sponsor, or any
officer or employee thereof, or any other person except to the extent that the
consequences of such directions are reflected in reports regularly communicated
to any such persons in the ordinary course of the performance of the Trustee's
services hereunder. However, the Trustee will provide to the Sponsor, as
reasonably requested by the Sponsor, periodic reports indicating the number of
shares tendered and not tendered. The Trustee shall tender or not tender shares
of HEI Common Stock as directed by the participant. The Trustee shall not tender
shares of HEI common stock reflecting a participant's proportional interest in
the HEI Common Stock Fund for which it has received no direction from the
participant.
(3) The Trustee shall tender that number of shares of HEI common
stock not credited to participants' accounts in the same proportion as the total
number of shares of HEI common stock credited to participants' accounts for
which it has received instructions from participants.
(4) A participant who has directed the Trustee to tender some or
all of the shares of HEI common stock reflecting the participant's proportional
interest in the HEI Common Stock Fund may, at any time prior to the tender offer
withdrawal date, direct the Trustee to withdraw some or all of the tendered
shares reflecting the participant's proportional interest, and the Trustee shall
withdraw the directed number of shares from the tender offer prior to the tender
offer withdrawal deadline. Prior to the withdrawal deadline, if any shares of
HEI common stock not credited to participants' accounts have been tendered, the
Trustee shall redetermine the number of shares of HEI common stock that would be
tendered under Section 4(d)(v)(B)(3) if the date of the foregoing withdrawal
were the date of determination, and withdraw from the tender offer the number of
shares of HEI common stock not credited to participants' accounts necessary to
reduce the amount of tendered HEI common stock not credited to participants'
accounts to the amount so redetermined. A participant shall not be limited as to
the number of directions to tender or withdraw that the participant may give to
the Trustee.
(5) A direction by a participant to the Trustee to tender shares
of HEI common stock reflecting the participant's proportional interest in the
HEI Common Stock Fund shall not
9
be considered a written election under the Plan by the participant to withdraw,
or have distributed, any or all of his withdrawable shares. The Trustee shall
credit to each participant's account a proportional share of the proceeds
received by the Trustee for the shares of HEI common stock tendered. Pending
receipt of directions from the participant or the PIC, as to which of the
remaining investment options the proceeds should be invested in, the Trustee
shall invest the proceeds in the investment option described in Schedule "C".
(vi) Shares Credited. For all purposes of this Section, the number
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of shares of HEI common stock deemed credited to each participant's account as
of the relevant date (the record date or the date specified in a tender offer)
shall be calculated by reference to the number of shares reflected on the books
of the transfer agent as of the relevant date. In the case of a tender, the
number of shares credited shall be determined as of a date as close as
administratively feasible to the relevant date. For the HEI Common Stock Fund,
each participant shall be credited with a pro rata portion of the shares held by
the fund calculated in accordance with the preceding sentences.
(vii) General. With respect to all rights other than the right to
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vote, the right to tender, and the right to withdraw shares previously tendered,
in the case of HEI common stock credited to a participant's proportional
interest in the HEI Common Stock Fund, the Trustee shall follow the directions
of the participant and if no such directions are received, the directions of the
Sponsor or PIC. The Trustee shall have no duty to solicit directions from
participants. With respect to all rights other than the right to vote and the
right to tender, in the case of HEI common stock not credited to participants'
accounts, the Trustee shall follow the directions of the Sponsor or PIC.
(viii) Conversion. All provisions in this Section 4(d) shall also
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apply to any securities received as a result of a conversion of HEI common
stock.
(e) ASB Money Market Account Operating Procedures. Transactions involving
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the ASB Money Market Account shall be executed in accordance with separate
written Operating Procedures as agreed to between the Sponsor or PIC and the
Trustee as amended from time to time in writing and attached hereto as Schedule
"G".
(f) Execution of Trades. Purchases and sales of securities issued by
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investment companies shall be made by the Trustee at the same time as purchases
of Sponsor Stock are made pursuant to subparagraph (d) (iii) above.
(g) Mutual Fund Voting. At the time of mailing of notice of each annual
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or special stockholders' meeting of any investment company, the Trustee shall
send a copy of the notice and all proxy solicitation materials to each Plan
participant who has shares of the investment company credited to the
participant's accounts, together with a voting direction form for return to the
Trustee or its designee. The participant shall have the right to direct the
Trustee as to the manner in which the Trustee is to vote the shares
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credited to the participant's accounts (both vested and unvested). The Trustee
shall vote the shares as directed by the participant. The Trustee shall not vote
shares for which it has received no directions from the participant. With
respect to all rights other than the right to vote, the Trustee shall follow the
directions of the participant and if no such directions are received, the
directions of the PIC. The Trustee shall have no duty to solicit directions from
participants.
(h) Limitation of Liability; Reliance of Trustee on Directions.
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(i) Neither the Trustee nor any other fiduciary of the Plan shall be
liable for any loss, or by reason of any breach of fiduciary responsibility,
which arises from any participant's exercise or non-exercise of rights under
this Section 4 over the assets in the participant's accounts.
(ii) The Trustee shall not be liable for any loss, or by reason of
any breach of fiduciary responsibility, which arises from the Sponsor's or PIC's
exercise or non-exercise of rights under this Section 4, unless the Trustee knew
or should have known that the actions to be taken under the Sponsor's or PIC's
directions were prohibited by the fiduciary duty rules of ERISA or were contrary
to the terms of this Agreement.
(i) Trustee Powers. The Trustee shall have the following powers and
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authority:
(i) Subject to paragraphs (b), (c), and (d) of this Section 4, to
sell, exchange, convey, transfer, or otherwise dispose of any property held in
the Trust, by private contract or at public auction. No person dealing with the
Trustee shall be bound to see to the application of the purchase money or other
property delivered to the Trustee or to inquire into the validity, expediency,
or propriety of any such sale or other disposition.
(ii) Subject to paragraphs (b) and (c) of this Section 4, to invest
in guaranteed investment contracts and short-term investments (including
interest bearing accounts with the Trustee or money market mutual funds advised
by affiliates of the Trustee) and in collective investment funds maintained by
the Trustee for qualified plans, in which case the provisions of each collective
investment fund in which the Trust is invested shall be deemed adopted by the
Sponsor and the provisions thereof incorporated as a part of this Trust and the
Plan.
(iii) To cause any securities or other property held as part of the
Trust to be registered in the Trustee's own name, in the name of one or more of
its nominees, or in the Trustee's account with the Depository Trust Company of
New York and to hold any investments in bearer form, but the books and records
of the Trustee shall at all times show that all such investments are part of the
Trust.
(iv) To keep that portion of the Trust in cash or cash balances as
the PIC may, from time to time, deem to be in the best interest of the Trust.
11
(v) To borrow funds from a bank not affiliated with the Trustee
in order to provide sufficient liquidity to process Plan transactions relating
to the HEI Common Stock Fund in a timely fashion; provided that the cost of such
borrowing shall be allocated to the HEI Common Stock Fund.
(vi) To make, execute, acknowledge, and deliver any and all
documents of transfer or conveyance and to carry out the powers herein granted.
(vii) To settle, compromise, or submit to arbitration any claims,
debts, or damages due to or arising from the Trust; to commence or defend suits
or legal or administrative proceedings; to represent the Trust in all suits and
legal and administrative hearings; and to pay all reasonable expenses arising
from any such action, from the Trust if not paid by the Sponsor.
(viii) To employ legal, accounting, clerical, and other
assistance as may be required in carrying out the provisions of this Agreement
and to pay their reasonable expenses and compensation from the Trust if not paid
by the Sponsor.
(ix) To do all other acts although not specifically mentioned
herein, as the Trustee may deem necessary to carry out any of the foregoing
powers and the purposes of the Trust.
(j) Loans. The Sponsor shall act as the Trustee's agent for the purpose
-----
of holding all trust investments in participant loan notes and related
documentation and as such shall (i) hold physical custody of and keep safe the
notes and other loan documents, (ii) separately account for repayments of such
loans and clearly identify such assets as Plan assets, (iii) collect and remit
all principal and interest payments to the Trustee, and (iv) cancel and
surrender the notes and other loan documentation when a loan has been paid in
full. To originate a participant loan, the Plan participant shall direct the
Trustee as to the type of loan to be made from the participant's individual
account. Such directions shall be made by Plan participants by use of the
telephone exchange system maintained for such purpose by the Trustee or its
agent. The Trustee shall determine, based on the current value of the
participant's account, the amount available for the loan. Based on the annual
interest rate, but changed from time to time, supplied by the Sponsor, PIC or
Administrative Committee in accordance with the Plan's loan procedures, the
Trustee shall advise the participant of such interest rate, as well as the
installment payment amounts. The Trustee shall forward the loan document to the
participant for execution and submission for approval to the Administrative
Committee. The Administrative Committee shall have the responsibility for
approving the loan and instructing the Trustee to send the loan proceeds to the
participant. If the Administrative Committee does not approve or disapprove the
loan within 30 days of the participant's initial request, the participant must
reinitiate the request with the Trustee.
(k) Non-Fidelity Mutual Funds. All transactions involving Non-Fidelity
-------------------------
Mutual Funds shall be done in accordance with the Operating Procedures attached
hereto as Schedule "I".
12
Section 5. Recordkeeping to Be Performed
-----------------------------
(a) General. The Trustee shall perform only the recordkeeping and
-------
administrative services set forth on Schedule "A" attached hereto and made a
part hereof, as amended from time to time, and only within a framework of
administration, including Plan policies, interpretations, rules, practices, and
procedures provided in writing by the Sponsor, PIC, or Administrative Committee.
(b) Accounts. The Trustee shall keep accurate accounts of all
--------
investments, receipts, disbursements, and other transactions hereunder, and
shall value the assets held in the Trust as of the last day of each fiscal
quarter of the Plan and, if not on the last day of a fiscal quarter, the date on
which the Trustee resigns or is removed as provided in Section 9 of this
Agreement or is terminated as provided in Section 10 (the "Valuation Date").
Within thirty (30) days following each valuation date or within sixty (60) days
in the case of the resignation or removal of the Trustee, or the termination of
this Agreement, the Trustee shall file with the PIC a written account setting
forth all investments, receipts, disbursements, and other transactions effected
by the Trustee between the valuation date and the prior Valuation Date, and
setting forth the value of the Trust as of the Valuation Date. Except as
otherwise required under ERISA, upon the expiration of six (6) months from the
date of filing such account with the PIC, the Trustee shall have no liability or
further accountability to anyone with respect to the propriety of its acts or
transactions shown in such account, except with respect to such acts or
transactions as to which the Sponsor or PIC shall within such six (6) month
period file with the Trustee written objections.
(c) Inspection and Audit. All records generated by the Trustee in
--------------------
accordance with paragraphs (a) and (b) of this Section 5 shall be open to
inspection and audit during the Trustee's regular business hours by the PIC or
any person designated by the PIC. Upon the resignation or removal of the
Trustee or the termination of this Agreement, the Trustee shall provide to the
Sponsor or the Sponsor's agent, at no expense to the Sponsor, in the format
regularly provided to the PIC, a statement of each participant's accounts as of
the resignation, removal, or termination, and the Trustee shall provide to the
Sponsor or the Plan's new recordkeeper such further records as are reasonably
necessary or requested to facilitate the transition at the Sponsor's expense.
(d) Necessary Information. The Trustee's provision of the recordkeeping
---------------------
services set forth in this Section 5 shall be conditioned on the Sponsor, PIC or
Administrative Committee providing the Trustee on a timely basis with all the
information the Sponsor, PIC or Administrative Committee deems necessary for the
Trustee to perform the recordkeeping services and such other information as the
Trustee may reasonably request including, but not limited to, copies of all Plan
amendments.
(e) Returns, Reports and Information. The PIC or Administrative Committee
--------------------------------
shall be responsible for the preparation and filing of all returns, reports, and
information required of the Trust or Plan by law. The Trustee shall provide the
PIC or Administrative Committee with such information as
13
each may reasonably request to make these filings. The PIC or Administrative
Committee shall also be responsible for making any disclosures to participants
required by law including, without limitation, such disclosures as may be
required under federal or state truth-in-lending laws with regard to participant
loans.
Section 6. Compensation and Expenses. Within thirty (30) days of receipt of the
-------------------------
Trustee's quarterly xxxx, which shall be computed in accordance with Schedule
"B" attached hereto and made a part hereof, as amended from time to time, the
Sponsor shall send to the Trustee a payment in such amount. All expenses of the
Trustee relating directly to the acquisition and disposition of investments
constituting part of the Trust, and all taxes of any kind whatsoever that may be
levied or assessed under existing or future laws upon or in respect of the Trust
or the income thereof, shall be a charge against and paid from the appropriate
Plan participants' accounts if not paid by the Sponsor.
Section 7. Directions.
----------
(a) Identity of Administrator and Named Fiduciary. The Trustee shall be
---------------------------------------------
fully protected in relying on the fact that the PIC is the named fiduciary and
the administrator of the Plan and that the Sponsor will notify the Trustee in
writing if there is a change in this fact.
(b) Directions from Administrator. Whenever the Sponsor, PIC or
-----------------------------
Administrative Committee provides a direction to the Trustee, the Trustee shall
not be liable for any loss, or by reason of any breach of fiduciary
responsibility, arising from the carrying out of the direction if the direction
is contained in writing (or is oral and immediately confirmed in writing) signed
by any individual whose name and signature have been submitted (and not
withdrawn) in writing to the Trustee by the Sponsor (see Schedule "D"), provided
the Trustee reasonably believes the signature of the individual to be genuine,
unless the Trustee knew or should have known that the actions to be taken under
the direction would be prohibited by the fiduciary duty rules of ERISA or would
be contrary to the terms of this Agreement. The Trustee shall have no
responsibility to ascertain any direction's (i) compliance with the terms of the
Plan or any applicable law, or (ii) effect for tax purposes or otherwise.
(c) Co-fiduciary Liability. In any other case, the Trustee shall not be
----------------------
liable for any loss, or by reason of any breach of fiduciary responsibility,
arising from any act or omission of another fiduciary under the Plan except as
provided in section 405(a) of ERISA.
(d) Indemnification of Trustee. The Sponsor shall indemnify the Trustee
--------------------------
against, and hold the Trustee harmless from, any and all loss, damage, penalty,
liability, cost, and expense, including without limitation, reasonable
attorneys' fees and disbursements, that may be incurred by or imposed upon the
Trustee by reason of any claim, regulatory proceeding, or litigation arising
from any act done or omitted
14
to be done by any individual or person with respect to the Plan or Trust,
excepting only any and all loss, etc., arising solely from the Trustee's
negligence or bad faith.
(e) Indemnification of Sponsor. The Trustee agrees to indemnify and hold
--------------------------
harmless the Sponsor for (i) any loss incurred by the Sponsor, a participant, or
a beneficiary due to a trading error caused by the Trustee on any investment
option included on Schedule A and (ii) any loss related to balance discrepancies
between the participant balances maintained by Trustee and the balance
maintained by any outside fund provider for any Plan investment option included
on Schedule A. The Trustee agrees to compensate the Sponsor, participant, or a
beneficiary for the cost of any adjustments due to any such error.
(f) Survival. The provisions of this Section 7 shall survive the
--------
termination of this Agreement.
Section 8. Resignation or Removal of Trustee.
---------------------------------
(a) Resignation. The Trustee may resign at any time upon ninety (90)
-----------
days' notice in writing to the Sponsor, unless a shorter period of notice is
agreed upon by the Sponsor.
(b) Removal. The Sponsor may remove the Trustee at any time upon sixty
-------
(60) days' notice in writing to the Trustee, unless a shorter period of notice
is agreed upon by the Trustee.
Section 9. Successor Trustee.
-----------------
(a) Appointment. If the office of Trustee becomes vacant for any reason,
-----------
the Sponsor may in writing appoint a successor trustee under this Agreement.
The successor trustee shall have all of the rights, powers, privileges,
obligations, duties, liabilities, and immunities granted to the Trustee under
this Agreement. The successor trustee and predecessor trustee shall not be
liable for the acts or omissions of the other with respect to the Trust.
(b) Acceptance. When the successor trustee accepts its appointment under
----------
this Agreement, title to and possession of the Trust assets shall immediately
vest in the successor trustee without any further action on the part of the
predecessor trustee. The predecessor trustee shall execute all instruments and
do all acts that reasonably may be necessary or reasonably may be requested in
writing by the Sponsor or the successor trustee to vest title to all Trust
assets in the successor trustee or to deliver all Trust assets and all pertinent
data to the successor trustee.
(c) Corporate Action. Any successor of the Trustee or successor trustee,
----------------
through sale or transfer of the business or trust department of the Trustee or
successor trustee, or through reorganization, consolidation, or merger, or any
similar transaction, shall, upon consummation of the transaction, become the
successor trustee under this Agreement, and the successor trustee shall be
liable for the acts or omissions of the other with respect to the Trust.
15
Section 10. Termination. The trust created under this Agreement may be
-----------
terminated at any time by the Sponsor upon sixty (60) days' notice in writing to
the Trustee. On the date of the termination of this Agreement, the Trustee shall
forthwith transfer and deliver to such individual or entity as the Sponsor shall
designate, all cash and assets then constituting the Trust. If, by the
termination date, the Sponsor has not notified the Trustee in writing as to whom
the assets and cash are to be transferred and delivered to, the Trustee may
bring an appropriate action or proceeding for leave to deposit the assets and
cash in a court of competent jurisdiction. The Trustee shall be reimbursed by
the Sponsor for all costs and expenses of the action or proceeding including,
without limitation, reasonable attorneys' fees.
Section 11. Resignation, Removal and Termination Notices. All notices of
---------------------------------------------
resignation, removal, or termination under this Agreement must be in writing and
mailed to the party to which the notice is being given by certified or
registered mail, return receipt requested, to the Sponsor c/o Treasurer,
Hawaiian Electric Industries, Inc., 000 Xxxxxxxx Xxxxxx, Xxxxxxxx, Xxxxxx
00000, and to the Trustee c/o Deputy General Counsel - ERISA Group, Fidelity
Investments, 00 Xxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, or to such other
addresses as the parties have notified each other of in the foregoing manner.
Section 12. Duration. This Trust shall continue in effect without limit as to
--------
time, subject, however, to the provisions of this Agreement relating to
amendment, modification, and termination thereof.
Section 13. Amendment or Modification. Subject to the provisions of Section 2,
--------------------------
this Agreement may be amended or modified at any time and from time to time only
by an instrument executed by both the Sponsor and the Trustee. In addition, no
amendment to the Plan that might affect the Trustee's responsibilities hereunder
will be effective against the Trustee, unless the Trustee has given its written
consent to the Plan amendment. The Trustee shall not unreasonably withhold its
consent to any amendment or modification of this Agreement or the Plan.
Notwithstanding the foregoing, to reflect increased operating costs the Trustee
may once each calendar year amend Schedule "B" without the Sponsor's consent
upon seventy-five (75) days written notice to the Sponsor.
Section 14. General.
-------
(a) Performance by Trustee, its Agents or Affiliates. The Sponsor
------------------------------------------------
acknowledges and authorizes that the services to be provided under this
Agreement shall be provided by the Trustee, its agents or affiliates, including
Fidelity Investments Institutional Operations Company or its successor, and that
16
certain of such services may be provided pursuant to one or more other
contractual agreements or relationships.
(b) Entire Agreement. This Agreement contains all of the terms agreed
----------------
upon between the parties with respect to the subject matter hereof.
(c) Waiver. No waiver by either party of any failure or refusal to
------
comply with an obligation hereunder shall be deemed a waiver of any other or
subsequent failure or refusal to so comply.
(d) Successors and Assigns. The stipulations in this Agreement shall
----------------------
inure to the benefit of, and shall bind, the successors and assigns of the
respective parties.
(e) Partial Invalidity. If any term or provision of this Agreement or
------------------
the application thereof to any person or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of this Agreement, or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable, shall not be affected thereby, and each
term and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.
(f) Section Headings. The headings of the various sections and
----------------
subsections of this Agreement have been inserted only for the purposes of
convenience and are not part of this Agreement and shall not be deemed in any
manner to modify, explain, expand or restrict any of the provisions of this
Agreement.
Section 15. Governing Law.
--------------
(a) Massachusetts Law Controls. This Agreement is being made in the
--------------------------
Commonwealth of Massachusetts, and the Trust shall be administered as a
Massachusetts trust. The validity, construction, effect, and administration of
this Agreement shall be governed by and interpreted in accordance with the laws
of the Commonwealth of Massachusetts, except to the extent those laws are
superseded under section 514 of ERISA.
(b) Trust Agreement Controls. The Trustee is not a party to the Plan,
------------------------
and in the event of any conflict between the provisions of the Plan and the
provisions of this Agreement, the provisions of this Agreement will control with
respect to the rights and obligations of the Trustee.
17
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the day and year first above
written.
HAWAIIAN ELECTRIC INDUSTRIES, INC.
BY: HAWAIIAN ELECTRIC INDUSTRIES, INC.
PENSION INVESTMENT COMMITTEE
Attest: /s/ Xxxxx X. Xxxxx By: /s/ Xxxxx X. Xxxxx
------------------- -------------------------
Assistant Secretary
Name: Xxxxx X. Xxxxx
-------------------------
Title: Member
-------------------------
Date: 1/14/00
-------------------------
Attest: /s/ Xxxxx X. Xxxxx By: /s/ Xxxxxx X. Xxxxxxxx
------------------- -------------------------
Assistant Secretary
Name: Xxxxxx X. Xxxxxxxx
-------------------------
Title: Member
-------------------------
Date: 1/14/00
-------------------------
FIDELITY MANAGEMENT TRUST
COMPANY
Attest: /s/ Xxxxxxx X. Xxxx By: /s/ Xxxxxxx Xxxxxx
------------------- --------------------------
Assistant Clerk
Name: Xxxxxxx Xxxxxx
--------------------------
Title: Vice President
--------------------------
Date: 1/27/2000
--------------------------
18
Schedule "A"
ADMINISTRATIVE SERVICES
-----------------------
Administration
--------------
* Establishment and maintenance of participant account and election
percentages.
* Maintenance of the following plan investment options:
- Fidelity Retirement Money Market Portfolio
- ASB Money Market Account
- HEI Common Stock Fund
- Fidelity Puritan Fund
- Fidelity Magellan Fund
- Fidelity Overseas Fund
- Fidelity Freedom 2000 Fund
- Fidelity Freedom 2010 Fund
- Fidelity Freedom 2020 Fund
- Fidelity Freedom 2030 Fund
- Fidelity Freedom Income Fund
- Spartan U.S. Equity Index Fund
- MAS Value Portfolio Adviser
- Xxxxxxxxx Xxxxxx Partners Trust
- PBHG Emerging Growth Fund
- Fidelity U.S. Bond Index Fund
* Maintenance of the following money classifications:
- Salary Reduction
- Participant Voluntary
- Rollover
- HEI Diversified Plan
- Employer ASB
- Employer Supplemental
- XXX
- Voluntary HEISOP
- Employer HEISOP
* Processing of investment option trades.
The Trustee will provide only the recordkeeping and administrative services
set forth on this Schedule "A" and no others.
19
Processing
----------
* Weekly processing of participant data, contributions, and loan repayments
* Daily processing of transfers and changes of future allocations via the
telephone exchange system
* Daily processing of withdrawals
Other
-----
* Monthly trial balance
* Monthly loan reports
* Quarterly administrative reports
* Quarterly participant statements
* 1099Rs
* Account segregation for Qualified Domestic Relations Orders ("QDRO") as
directed by Sponsor
* Excess contributions report
* Participant loans
* Periodic meetings with Sponsor
* Educational services as needed and mutually agreed upon by the Trustee
and the Sponsor
* Minimum Required Distribution ("MRD") service
HAWAIIAN ELECTRIC INDUSTRIES, INC. FIDELITY MANAGEMENT TRUST
BY: HAWAIIAN ELECTRIC INDUSTRIES, INC. COMPANY
PENSION INVESTMENT COMMITTEE
By: /s/ Xxxxx X. Xxxxx 1/14/00 By: /s/ Xxxxxxx Xxxxxx 1/27/2000
---------------------------------- -------------------------------
Xxxxx X. Xxxxx Date Vice President Date
Member
By: /s/ Xxxxxx X. Xxxxxxxx 1/14/00
----------------------------------
Xxxxxx X. Xxxxxxxx Date
Secretary and Member
20
Schedule "B"
FEE SCHEDULE
------------
Recordkeeping Fees
------------------
* Annual Participation Fee $5.00 per participant** per year,
billed and payable quarterly.
* Minimum Required Distribution ("MRD") $25.00 per MRD recipient per year.
* Plan Establishment Fee $2,500.00
* Loan Fee Establishment fee of $35.00 per loan
account; annual fee of $15.00 per loan
account.**
* Plan Sponsor WebStation ("WebStation") All User ID fees waived.
* NetBenefits All User ID fees waived.
* Other Fees: extraordinary expenses resulting from large numbers of
simultaneous manual transactions or from errors not caused by Fidelity.
** This fee will be imposed pro rata for each calendar quarter, or any part
--------
thereof, that it remains necessary to keep a participant's account(s) and/or
loans(s) as part of the Plan's records, e.g. vested, deferred, forfeiture, top-
heavy and terminated participants, if applicable, who must remain on file
through the calendar year-end for 1099R reporting.
Trustee Fee
-----------
Investment Options
* Sponsor Stock: 0.10% per annum of such assets in the Trust
payable quarterly on the basis of such assets as
of the average market value for each calendar
quarter. In no event will the fee be less than
$10,000 nor more than $35,000 per year.
* Others: None.
HAWAIIAN ELECTRIC INDUSTRIES, INC. FIDELITY MANAGEMENT TRUST
BY: HAWAIIAN ELECTRIC INDUSTRIES, INC. COMPANY
PENSION INVESTMENT COMMITTEE
By: /s/ Xxxxx X. Xxxxx 1/14/00 By: /s/ Xxxxxxx Xxxxxx 1/27/2000
---------------------------------- --------------------------------
Xxxxx X. Xxxxx Date Vice President Date
Member
By: /s/ Xxxxxx X. Xxxxxxxx 1/14/00
----------------------------------
Xxxxxx X. Xxxxxxxx Date
Secretary and Member
21
Schedule "C"
INVESTMENT OPTIONS
------------------
In accordance with Section 4(b), the PIC hereby directs the Trustee that
participants' individual accounts may be invested in the following investment
options:
- Fidelity Retirement Money Market Portfolio
- ASB Money Market Account
- HEI Common Stock Fund
- Fidelity Puritan Fund
- Fidelity Magellan Fund
- Fidelity Overseas Fund
- Fidelity Freedom 2000 Fund
- Fidelity Freedom 2010 Fund
- Fidelity Freedom 2020 Fund
- Fidelity Freedom 2030 Fund
- Fidelity Freedom Income Fund
- Spartan U.S. Equity Index Fund
- MAS Value Portfolio
- Xxxxxxxxx Xxxxxx Partners Trust
- PBHG Emerging Growth Fund
- Fidelity U.S. Bond Index Fund
The investment option referred to in Section 4(c) and Section 4(d)(v)(B)(5)
shall be the ASB Money Market Account.
HAWAIIAN ELECTRIC INDUSTRIES, INC.
BY: HAWAIIAN ELECTRIC INDUSTRIES, INC.
PENSION INVESTMENT COMMITTEE
By: /s/ Xxxxx X. Xxxxx 1/14/00
----------------------------------
Xxxxx X. Xxxxx Date
Member
By: /s/ Xxxxxx X. Xxxxxxxx 1/14/00
----------------------------------
Xxxxxx X. Xxxxxxxx Date
Secretary and Member
22
Schedule "D", Part 1
February 1, 2000
[LOGO]
Xx. Xxxxxxx Xxxxxx
Fidelity Investments Institutional
Operations Company, Inc.
000 Xxxxxxx Xxx - XX0X
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000-0000
Re: Hawaiian Electric Industries Retirement Savings Plan
Dear Xx. Xxxxxx:
This letter is sent to you in accordance with Section 7(b) of the Trust
Agreement dated February 1, 2000 between Hawaiian Electric Industries, Inc. and
Fidelity Management Trust Company.
We hereby designate Xxxxxx X. Xxxxxxx, Xxxxx X. Xxxxx, Xxxxxx X. Xxxxxxxx,
Xxxxxx X. X. Xxx, Xxxxx X. Xxxxxx, Xxxxx X. Xxxxx, and Xxxx X. X'Xxxxx as the
individuals who may provide directions upon which Fidelity Management Trust
Company shall be fully protected in relying. Only one such individual need
provide any direction. The signature of each designated individual is set forth
on Schedule "D", Part 2, and certified to be such.
You may rely upon each designation and certification set forth in this
letter until we deliver to you written notice of the termination of authority of
a designated individual.
Very truly yours,
HAWAIIAN ELECTRIC INDUSTRIES, INC.
BY: HAWAIIAN ELECTRIC INDUSTRIES, INC.
PENSION INVESTMENT COMMITTEE
By: /s/ Xxxxx X. Xxxxx
-------------------------------
Xxxxx X. Xxxxx
Member
By: /s/ Xxxxxx X. Xxxxxxxx
-------------------------------
Xxxxxx X. Xxxxxxxx
Secretary and Member
Attachment
23
Schedule "D", Part 2
Signature of Designated Individuals
/s/ Xxxxxx X. Xxxxxxx /s/ Xxxxx X. Xxxxx
------------------------------------ -------------------------------------
Xxxxxx X. Xxxxxxx Xxxxx X. Xxxxx
Financial Vice President & Manager, Employee Benefits
Chief Financial Officer, HEI and Health Services, HECO
Chairman, PIC Secretary, Administrative Committee
/s/ Xxxxx X. Xxxxx /s/ Xxxx X. X'Xxxxx
------------------------------------ -------------------------------------
Xxxxx X. Xxxxx Xxxx X. X'Xxxxx
Vice President, Administration & Benefits Administrator, HECO
Corporate Secretary, HEI Member, Administrative Committee
Member, PIC
Chairman, Administrative Committee
/s/ Xxxxxx X. Xxxxxxxx /s/ Xxxxx X. Xxxxxx
------------------------------------ -------------------------------------
Xxxxxx X. Xxxxxxxx Xxxxx X. Xxxxxx
Treasurer, HEI Corporate Finance & Investments
Secretary and Member, PIC Administrator, HEI
/s/ Xxxxxx X. X. Xxx
------------------------------------
Xxxxxx X. X. Xxx
Director - Corporate Finance &
Investments, HEI
Hawaiian Electric Industries, Inc. (HEI)
Hawaiian Electric Company, Inc. (HECO)
HEI Pension Investment Committee (PIC)
24
Schedule "E"
DEPARTMENT OF THE TREASURY
INTERNAL REVENUE SERVICE
DISTRICT DIRECTOR
000 XXXXXX XXXXXX, XX 510
XXXXXXX, XX 00000
Employer Identification Number:
Date: June 21, 1995 00-0000000
File Folder Number:
990010537
HAWAIIAN ELECTRIC INDUSTRIES, INC. Person to Contact:
X.X. XXX 000 XXXX XX XXXXX XXXXXXXXX
XXXXXXXX, XX 00000 Contact Telephone Number:
(000) 000-0000
Plan Name:
HAWAIIAN ELECTRIC INDUSTRIES
RETIREMENT SAVINGS PLAN
Plan Number: 003
Dear Applicant:
We have made a favorable determination on your plan, identified above,
based on the information supplied. Please keep this letter in your permanent
records.
Continued qualification of the plan under its present form will depend on
its effect in operation. (See section 1.401-1(b)(3) of the Income Tax
Regulations.) We will review the status of the plan in operation periodically.
The enclosed document explains the significance of this favorable
determination letter, points out some features that may affect the qualified
status of your employee retirement plan, and provides information on the
reporting requirements for your plan. It also describes some events that
automatically nullify it. It is very important that you read the publication.
This letter relates only to the status of your plan under the Internal
Revenue Code. It is not a determination regarding the effect of other federal
or local statutes.
Your plan does not consider total compensation for purposes of figuring
benefits. In operation, the provision may discriminate in favor of employees
who are highly compensated. If this occurs, your plan will not remain
qualified.
This determination letter is applicable for the amendment(s) adopted on 11-
21-94.
This plan has been mandatorily disaggregated, permissively aggregated, or
restructured to satisfy the nondiscrimination requirements.
This letter is issued under Rev. Proc. 93-39 and considers the amendments
required by the Tax Reform Act of 1986 except as otherwise specified in this
letter.
This plan satisfies the nondiscriminatory current availability requirements
of section 1.401(a)(4)-4(b) of the regulations with respect to those benefits,
rights, and features that are currently available to all employees in the plan's
coverage group. For this purpose, the plan's coverage group consists of those
employees treated as currently benefiting for purposes of
Letter 835(DO/CG)
25
- 2-
HAWAIIAN ELECTRIC INDUSTRIES, INC.
demonstrating that the plan satisfies the minimum coverage requirements of
section 410(b) of the Code.
This letter may not be relied upon with respect to whether the plan
satisfies the qualification requirements as amended by the Uruguay Round
Agreements Act, Pub. L. 103-465.
The information on the enclosed addendum is an integral part of this
determination. Please be sure to read and keep it with this letter.
We have sent a copy of this letter to your representative as indicated in
the power of attorney.
If you have questions concerning this matter, please contact the person
whose name and telephone number are shown above.
Sincerely yours,
/s/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
District Director
Enclosures:
Publication 794
Reporting & Disclosure Guide
For Employee Benefit Plans
Addendum
Letter 835 (DO/CG)
26
- 3 -
HAWAIIAN ELECTRIC INDUSTRIES, INC.
This plan also satisfies the requirements of Code section 401(k).
Letter 835 (DO/CG)
27
Schedule "F"
TELEPHONE EXCHANGE GUIDELINES
-----------------------------
The following telephone exchange guidelines are currently employed by Fidelity
Institutional Retirement Services Company ("FIRSCO").
Telephone exchange hours are 8:30 a.m. Eastern time ("ET") to 8:00 p.m. ET on
each business day. A "business day" is any day on which the New York Stock
Exchange is open. Exchanges via Voice Response System ("VRS") and the internet
(NetBenefits) may be made virtually 24 hours a day.
FIRSCO reserves the right to change these telephone exchange guidelines at its
discretion. FIRSCO will notify the Sponsor of its intent to change these
guidelines prior to any change being instituted.
Note: The NYSE's normal closing time is 4:00 p.m. ET; in the event the NYSE
alters its closing time, all references below to 4:00 p.m. ET shall mean the
NYSE closing time as altered.
Investment Options
------------------
Exchanges Between Investment Options
------------------------------------
Participants may call on any business day to exchange between investment
options. If the request is received before 4:00 p.m. ET, it will receive that
day's trade date. Calls received after 4:00 p.m. ET will be processed on a next
business day basis.
HAWAIIAN ELECTRIC INDUSTRIES, INC.
BY: HAWAIIAN ELECTRIC INDUSTRIES, INC.
PENSION INVESTMENT COMMITTEE
By: /s/ Xxxxx X. Xxxxx 1/14/00
----------------------------------
Xxxxx X. Xxxxx Date
Member
By: /s/ Xxxxxx X. Xxxxxxxx 1/14/00
----------------------------------
Xxxxxx X. Xxxxxxxx Date
Member
28
Schedule "G"
Operating Procedures Agreement - ASB Money Market Account
---------------------------------------------------------
Based upon Fidelity Institutional Retirement Services Company's ("FIRSCO")
understanding of the American Savings Bank ("ASB") Money Market Account (the
"Fund") which will be priced at $1.00, the operating procedures are as follows:
Pricing
-------
ASB shall provide Fidelity with a change to the net asset value ("NAV") and
interest rate, in writing, via fax, at least fifteen calendar days prior to the
effective date. A list of employee names, including signatures, that are
authorized to initiate changes to the interest rate are attached hereto as
Exhibit 1. If for any reason, ASB is unable to determine a current valuation,
the last reported valuation of the Fund shall remain in effect. The valuations
provided by ASB shall not be reviewed by Fidelity. Fidelity shall be
responsible for accurately reflecting the NAV on the Fidelity Plan Sponsor
WebStation and participant statements.
Trade Instructions
------------------
By 9:00 a.m. Eastern Time ("ET") each business day, Fidelity will provide to
Hawaiian Electric Industries ("Sponsor"), via fax, a report of net activity that
occurred in the Fund on the prior business day. The report will reflect the net
dollar and share amounts of assets invested or withdrawn as of the end of the
processing date.
Fidelity will fax the report to the Sponsor each day, regardless of processing
activity. If for any reason Fidelity is unable to fax the report to the
Sponsor, Fidelity will notify the Sponsor of this by 2:00 p.m. ET. Sponsor is
responsible each business day, by 3:00 p.m. ET, for notifying Fidelity if the
report has not been received.
Monetary Transfers
------------------
For purposes of wire transfers, Fidelity will net purchase and redemption
activity occurring on the same day. The monetary transfers between Fidelity and
ASB will operate as follows:
. Based upon the cash value of the net redemption activity reported each day,
ASB will initiate a wire transfer to Fidelity for receipt by no later than
the close of business at the New York Federal Reserve Bank on the date the
report of net activity is received by ASB. The mailing of participant
distribution checks and investments into other investment options will
occur upon receipt of the wire from ASB.
. Based upon the cash value of the net purchase activity reported each day,
Fidelity will initiate a wire transfer to ASB for receipt by no later than
the close of business at the New York Federal Reserve Bank on the business
day after the transactions are processed on the Fidelity Participant
Recordkeeping System
. Wires will be sent according to wire instructions listed below.
Fidelity and ASB will monitor the receipt of wires on a daily basis. If for any
reason a wire is not received, the receiving party is responsible for notifying
the sender of this problem by 3:00 p.m. ET the next day. The party in error
shall be responsible for the amount of such wire, plus associated bank
penalties.
29
Corporate Actions
-----------------
If applicable, Sponsor will notify Fidelity of any proxies and other corporate
actions. If requested, Fidelity will provide Sponsor with participant balance
and address information necessary for any proxy mailing or other corporate
actions. Fidelity will not have any additional responsibilities relative to
corporate actions.
Fidelity assumes no responsibility for any loss incurred due to inaccurate
communications of corporate actions or failure to communicate corporate actions
by Sponsor.
Reconciliation
--------------
Fidelity shall send a Monthly Trial Balance that summarizes activity in the Fund
to the Sponsor within twenty (20) business days of each calendar month end. The
Sponsor or ASB shall notify Fidelity of any discrepancies within twenty (20)
business days of receipt. Additionally, ASB shall send Fidelity monthly fund
statements no later than ten (10) business days after each calendar month end.
The Sponsor agrees to indemnify and hold harmless Fidelity for any loss related
to discrepancies between the participant balances maintained by Fidelity and the
Plan's balance in the Fund, as maintained by ASB, due to errors caused by ASB or
the Sponsor.
Fidelity agrees to indemnify and hold harmless the Sponsor and ASB for any loss
related to balance discrepancies between the participant balances maintained by
Fidelity and the Plan's balance in the Fund, as maintained by ASB, due to errors
caused by Fidelity.
Indemnifications
----------------
Sponsor agrees to indemnify and hold harmless Fidelity for the following:
. Any loss incurred by Fidelity due to a pricing error caused by the Sponsor
or ASB. The Sponsor also agrees to compensate Fidelity for the cost of any
adjustments made to participant accounts due to such an error.
. Any loss incurred by Fidelity due to the inaccurate communication of
corporate actions by the Sponsor or ASB, or failure to communicate
corporate actions by the Sponsor or ASB.
. Any loss related to balance discrepancies between the participant balances
maintained by Fidelity and the balance maintained by ASB due to errors
caused by the Sponsor or ASB.
Fidelity agrees to indemnify and hold harmless Sponsor and ASB for the
following:
. Any loss incurred by ASB, the Sponsor, a participant or a beneficiary due
to a trading error caused by Fidelity. Fidelity also agrees to compensate
the Sponsor, ASB, participant or a beneficiary for the cost of any
adjustments to the Fund due to such error.
. Any loss related to balance discrepancies between the participant balances
maintained by Fidelity and the balance maintained by ASB due to errors
caused by Fidelity.
30
Fidelity's Wire Transfer Instructions:
Bankers Trust of New York, NY
ABA Number: 021 001 033
Account Name: FPRS Depository Account
Account Number: 001 63002
Beneficiary Reference: Plan 02045
American Savings Bank's Wire Instructions:
Federal Home Loan Bank of Seattle
ABA Number: 000000000
Account Name: American Savings Bank
Account Number: 8384-0012
Ref: Hawaiian Electric Industries Retirement Savings Plan
The above procedure and conditions are hereby confirmed by all parties.
FIDELITY INSTITUTIONAL HAWAIIAN ELECTRIC INDUSTRIES, INC.
RETIREMENT SERVICES COMPANY BY: HAWAIIAN ELECTRIC INDUSTRIES, INC.
PENSION INVESTMENT COMMITTEE
By: /s/ Xxxxxxx Xxxxxx By: /s/ Xxxxx X. Xxxxx
------------------------------ -------------------------------
Xxxxx X. Xxxxx
Title: Vice-President Title: Member
--------------------------- ----------------------------
Date: 1/27/2000 Date: 1/14/00
---------------------------- -----------------------------
By: /s/ Xxxxxx X. Xxxxxxxx
-------------------------------
Xxxxxx X. Xxxxxxxx
AMERICAN SAVINGS BANK, F.S.B. Title: Secretary and Member
----------------------------
By: /s/ Xxxxx Xxxxxx Date: 1/14/00
------------------------------ -----------------------------
Title: President
Date: 1/18/00
----------------------------
31
Exhibit 1
The following individuals are authorized to initiate changes to the daily
interest rate for the ASB Money Market Account investment alternative.
/s/ Xxxxx X. Xxxxxxxxx
--------------------------------------------
Xxxxx X. Xxxxxxxxx, Executive Vice President
/s/ Xxxxx X. Xxxxxxxx
--------------------------------------------
Xxxxx X. Xxxxxxxx, Senior Vice President/Finance
/s/ Xxxx Xxxxxx
--------------------------------------------
Xxxx Xxxxxx, Vice President/Controller
/s/ Xxxxxxxxx Xxxxxxxxx
--------------------------------------------
Xxxxxxxxx Xxxxxxxxx, Assistant Vice President
Assistant Controller
32
Schedule "H"
OPERATING PROCEDURES FOR NON-FIDELITY MUTUAL FUNDS
--------------------------------------------------
(Excluding HEI Common Stock Fund and ASB Money Market Account)
This schedule is part of an agreement between Fidelity Investments and non-
Fidelity mutual fund vendors; Hawaiian Electric Industries, Inc. is not a party
to this agreement and thus is not obligated under its terms.
Schedule H is included for informational purposes.
Pricing
-------
By 7:00 p.m. Eastern Time ("ET") each day the New York Stock Exchange is open
for business (a "Business Day"), the non-Fidelity mutual fund vendor ("Fund
Vendor") will input the following information ("Price Information") into the
Fidelity Participant Recordkeeping System ("FPRS") via the remote access price
screen that Fidelity Investments Institutional Operations Company, Inc.
("FIIOC"), an affiliate of the Trustee, has provided to the Fund Vendor: (1) the
net asset value for each Fund at the close of trading on the New York Stock
Exchange ("Close of Trading"), (2) the change in each Fund's net asset value
from the Close of Trading on the prior Business Day, and (3) in the case of an
income fund or funds, the daily accrual for interest rate factor ("mil rate").
FIIOC must receive Price Information each Business Day. If on any Business Day
the Fund Vendor does not provide such Price Information to FIIOC, FIIOC shall
pend all associated transaction activity in FPRS until the relevant Price
Information is made available by the Fund Vendor.
Trade Activity and Wire Transfers
---------------------------------
"Trade Date" refers to the Business Day on which FIIOC receives the instructions
from the Plan Participant. Instructions received prior to 4:00 p.m ET on a
Business Day will receive that Business Day's NAV. Instructions received after
4:00 p.m. ET will receive the NAV on the next Business Day.
By 7:00 a.m. ET each Business Day following Trade Date ("Trade Date plus One"),
----
FIIOC will provide, via facsimile, to the Fund Vendor a consolidated report of
net purchase or net redemption activity that occurred in each of the Funds up to
4:00 p.m. ET on the prior Business Day. The report will reflect the dollar
amount of assets and shares to be invested or withdrawn for each Fund. FIIOC
will transmit this report to the Fund Vendor each Business Day, regardless of
processing activity. In the event that data contained in the 7:00 a.m. ET
facsimile transmission represents estimated trade activity, FIIOC shall provide
a final facsimile to the Fund Vendor by no later than 9:00 a.m. ET. Any
resulting adjustments shall be processed by the Fund Vendor at the net asset
value for the prior Business Day.
The Fund Vendor shall send via regular mail to FIIOC transaction confirmation
for all daily activity in each of the Funds. The Fund Vendor shall also send via
regular mail to FIIOC, by no later than the fifth Business Day following the end
of each calendar month end close, a monthly statement for each Fund. FIIOC
agrees to notify the Fund Vendor of any balance discrepancies within twenty (20)
Business Days of receipt of the monthly statement.
For purposes of wire transfers, FIIOC shall transmit a daily wire for aggregate
purchase activity and the Fund Vendor shall transmit a daily wire for aggregate
redemption activity, in each case including all activity across all Funds
occurring on the same day.
33
Prospectus Delivery
-------------------
FIIOC shall be responsible for the timely delivery of Fund prospectuses and
periodic Fund reports ("Required Materials") to Plan participants, and shall
retain the services of a third-party vendor to handle such mailings. The Fund
Vendor shall be responsible for all materials and production costs, and hereby
agrees to provide the Required Materials to the third-party vendor selected by
FIIOC. The Fund Vendor shall bear the costs of mailing annual Fund reports to
Plan participants. FIIOC shall bear the costs of mailing prospectuses to Plan
participants.
Proxies
-------
Participants shall have the right to direct the Trustee as to the manner in
which the Trustee is to vote the shares of the Non-Fidelity Mutual Funds
credited to the participant's accounts (both vested and unvested). The Trustee
shall vote the shares as directed by the participant. The Trustee shall not vote
shares for which it has received no directions from the participant. With
respect to all rights other than the right to vote, the Trustee shall follow the
directions of the participant and if no such directions are received, the
directions of the Named Fiduciary. The Trustee shall have no further duty to
solicit directions from participants or the Sponsor.
The Fund Vendor shall be responsible for all costs associated with the
production of proxy materials. FIIOC shall retain the services of a third-party
vendor to handle proxy solicitation mailings and vote tabulation. Expenses
associated with such services shall be billed directly to the Fund Vendor by the
third-party vendor.
Participant Communications
--------------------------
The Fund Vendor shall provide internally-prepared fund descriptive information
approved by the Funds' legal counsel for use by FIIOC in its written participant
communication materials. FIIOC shall utilize historical performance data
obtained from third-party vendors (currently Morningstar, Inc., FACTSET Research
Systems and Lipper Analytical Services) in telephone conversations with plan
participants and in quarterly participant statements. The Sponsor hereby
consents to FIIOC's use of such materials and acknowledges that FIIOC is not
responsible for the accuracy of such third-party information. FIIOC shall seek
the approval of the Fund Vendor prior to retaining any other third-party vendor
to render such data or materials under this agreement.
Compensation
------------
FIIOC shall be entitled to fees as set forth in a separate agency agreement with
the Fund Vendor.
Indemnification
---------------
The Fund Vendor shall be responsible for compensating participants and/or FIIOC
in the event that losses occur as a result of (1) the Fund Vendor's failure to
provide FIIOC with Price Information or (2) providing FIIOC with incorrect Price
Information.
34
SCHEDULE "I"
PLAN SPONSOR WEBSTATION AGREEMENT
This Agreement is entered into effective as of the 1st day of February,
2000, by and between Fidelity Institutional Retirement Services Company, a
division of FMR Corp., a Massachusetts corporation ("Fidelity") and Hawaiian
Electric Industries, Inc. ("Sponsor").
1. Terms of Access and Use. Fidelity will provide the Sponsor and any
------------------------
individual authorized to act on behalf of the Sponsor, as identified in the
Trust or Recordkeeping Agreement entered into between Fidelity or Fidelity
Management Trust Company and the Sponsor, (collectively referred to as
"User") with access to Plan Sponsor WebStation ("WebStation") upon
Fidelity's acceptance of a properly completed Security Access Form.
Fidelity hereby grants the User a non-transferable license to access
WebStation in accordance with the terms and conditions described herein.
No rights are conveyed to any property, intellectual or tangible,
associated with WebStation. The User agrees to use WebStation in
accordance with the terms described herein and will not make it available
to any third party without the prior written consent of Fidelity.
2. Authorization of Directions. User agrees that Fidelity shall not be under
---------------------------
a duty to inquire as to the authority or propriety of any directions given
to Fidelity by the User and shall be entitled to act upon the direction any
person whom it reasonably believes to be an authorized representative of
the User.
3. Security of System. The User shall be responsible for the confidentiality
------------------
and use of any passwords and other security data, methods and devices
issued to or obtained by it or its employees, representatives or agents in
connection with the use of WebStation. The User shall comply with the
security procedures established by Fidelity for WebStation, including the
use of passwords and/or encryption methods.
The User agrees to promptly notify Fidelity of any unauthorized, negligent
or inadvertent use of the system of which it is aware. The User further
agrees to notify Fidelity of the termination of any employee who was
granted access to WebStation. Fidelity retains the right to immediately
suspend or withdraw access to WebStation, if, in Fidelity's opinion, such
action is necessary to maintain the integrity of WebStation.
4. Liability of the Parties. To the extent that Plan Sponsor WebStation
-------------------------
utilizes Internet services to transport data or communications, Fidelity
will take reasonable security precautions, but Fidelity disclaims any
liability for losses or other damages to the User resulting from
interception, alteration or loss of any such data or communications.
Fidelity shall not be responsible for, and makes no warranties regarding,
the access, speed or availability of Internet or network services.
5. Miscellaneous. This Agreement shall be binding upon and inure to the
--------------
benefit of the parties and their respective successors and assigns, and to
the beneficiaries of the Trust. This Agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of Massachusetts,
except to the extent pre-empted by the provisions of the Employee
Retirement Income Security Act of 1974. This Agreement may be terminated
by either party upon seven (7) days' written notice to the other party
hereto at the address indicated below. Sections 2, 4, and 5 shall survive
any termination of this Agreement.
6. WebStation will replace Remote Access and Plan Sponsor WorkStation. All
references and fees to Remote Access and Plan Sponsor WorkStation are
hereby amended as follows:
35
Plan Sponsor WebStation ("WebStation"): All User ID fees waived.
HAWAIIAN ELECTRIC INDUSTRIES, INC. FIDELITY INSTITUTIONAL
BY: HAWAIIAN ELECTRIC INDUSTRIES, INC. RETIREMENT SERVICES COMPANY
PENSION INVESTMENT COMMITTEE
By: /s/ Xxxxx X. Xxxxx 1/14/00 By: /s/ Xxxxxxx Xxxxxx 1/27/2000
---------------------------------- --------------------------------
Xxxxx X. Xxxxx Date Vice President Date
Member
By: /s/ Xxxxxx X. Xxxxxxxx 1/14/00
----------------------------------
Xxxxxx X. Xxxxxxxx Date
Secretary and Member
36
