EXHIBIT 10.17
TRUST UNDER
XXXXXX CAPITAL GROUP, INC. DEFERRED COMPENSATION PLAN
This Agreement made this 1st day of April, 2001 by and between Xxxxxx
Capital Group, Inc. (hereinafter referred to as the "Employer") and Allfirst
Trust Company (hereinafter referred to as the "Trustee");
WHEREAS, the Employer has adopted the nonqualified deferred compensation
plan (hereinafter referred to as the "Plan") as listed in Appendix A.
WHEREAS, the Employer has incurred or expects to incur liability under the
terms of such Plan with respect to the individuals participating in such Plan;
WHEREAS, the Employer wishes to establish the Xxxxxx Capital Group, Inc.
Trust (hereinafter referred to as the "Trust") and to contribute to the Trust
assets that shall be held therein, subject to the claims of the Employer's
creditors in the event of the Employer's Insolvency, as herein defined, until
paid to the Plan participants and their beneficiaries in such manner and at such
times as specified in the Plan;
WHEREAS, it is the intention of the parties that this Trust shall
constitute an unfunded arrangement and shall not affect the status of the Plan
as an unfunded plan maintained for the purpose of providing deferred
compensation for a select group of management or highly compensated employees
for purposes of Title I of the Employee Retirement Income Security Act of 1974,
as amended;
WHEREAS, it is the intention of the Employer to make contributions to the
Trust to provide itself with a source of funds to assist it in meeting its
liabilities under the Plan;
NOW, THEREFORE, the parties do hereby establish the Trust and agree
that the Trust shall be comprised, held and disposed of as follows:
1. ESTABLISHMENT OF TRUST.
(a) The Employer hereby deposits with the Trustee in trust one dollar
($1.00), which shall become the principal of the Trust to be held,
administered and disposed of by the Trustee as provided in this
Trust.
(b) The Trust hereby established is revocable by Employer; it shall
become irrevocable upon a Change of Control, as defined herein.
(c) The Trust is intended to be a grantor trust, of which the Employer
is the grantor, within the meaning of subpart E, part I, subchapter
J, chapter 1, Subtitle A of the Internal Revenue Code of 1986, as
amended, and shall be construed accordingly.
(d) The principal of the Trust, and any earnings thereon shall be
held separate and apart from other funds of the Employer and
shall be used exclusively for the uses and purposes of Plan
participants and general creditors as herein set forth. Plan
participants and their beneficiaries shall have no preferred
claim on, or any beneficial ownership interest in, any assets
of the Trust. Any rights created under the Plan and this
Trust shall be mere unsecured contractual rights of Plan
participants and their beneficiaries against the Employer.
Any assets held by the Trust will be subject to the claims of
the Employer's general creditors under federal and state law
in the event of Insolvency, as defined in Section 3(a) hereof.
(e) The Employer, in its sole discretion, may at any time, or from time
to time, make additional deposits of cash or other property in trust
with the Trustee to augment the principal to be held, administered
and disposed of by the Trustee as provided in this Trust Agreement.
Neither the Trustee nor any Plan participant or beneficiary shall
have any right to compel such additional
deposits.
(f) Upon a Change of Control, Employer shall, as soon as possible,
but in no event longer than five (5) days following the Change
of Control, as defined herein, make an irrevocable
contribution to the Trust in an amount that is sufficient to
pay each Plan participant or beneficiary the benefits to which
Plan participants or their beneficiaries would be entitled
pursuant to the terms of the Plan(s) as of the date on which
the Change of Control occurred.
2. PAYMENTS TO PLAN PARTICIPANTS AND BENEFICIARIES.
(a) The Employer shall deliver to the Trustee a schedule (the
"Payment Schedule") that indicates the amounts payable with
respect to each Plan participant (and his or her
beneficiaries), that provides a formula or other instructions
acceptable to the Trustee for determining the amounts so
payable, the form in which such amount is to be paid (as
provided for or available under the Plan(s)), and the time of
commencement for payment of such amounts. Except as otherwise
provided herein, the Trustee shall make payments to the Plan
participants and their beneficiaries in accordance with such
Payment Schedule. The Trustee shall make provision for the
reporting and withholding of any federal, state or local taxes
that may be required to be withheld with respect to the
payment of benefits pursuant to the terms of the Plan(s) and
shall pay amounts withheld to the appropriate taxing
authorities or determine that such amounts have been reported,
withheld and paid by the Employer.
(b) The entitlement of a Plan participant or his or her beneficiaries to
benefits under the Plan shall be determined by the Employer or such
party as it shall designate under the Plan, and any claim for such
benefits shall be considered and reviewed under the procedures set
out in the Plan.
(c) The Employer may make payment of benefits directly to Plan
participants or their beneficiaries as they become due under
the terms of the Plan(s). The Employer shall notify the
Trustee of its decision to make payment of benefits directly
prior to the time amounts are payable to participants or their
beneficiaries. In addition, if the principal of the Trust,
and any earnings thereon, are not sufficient to make payments
of benefits in accordance with the terms of the Plan, the
Employer shall make the balance of each such payment as it
falls due. The Trustee shall notify the Employer where
principal and earnings are not sufficient.
3. TRUSTEE RESPONSIBILITY REGARDING PAYMENTS TO THE TRUST BENEFICIARY WHEN
EMPLOYER IS INSOLVENT.
(a) The Trustee shall cease payment of benefits to Plan participants and
their beneficiaries if the Employer is Insolvent. The Employer shall
be considered "Insolvent" for purposes of this Trust if:
(i) the Employer is unable to pay its debts as they become due; or
(ii) the Employer is subject to a pending proceeding as a debtor
under the United States Bankruptcy Code.
(b) At all times during the continuance of this Trust, as provided in
Section 1(d) hereof, the principal and income of the Trust shall be
subject to claims of general creditors of the Employer under federal
and state law as set forth below:
(i) The Board of Directors and the Chief Executive Officer (or, if
there is no Chief Executive Officer, the highest ranking
officer of the Employer) of the Employer shall have the duty
to inform the Trustee in
writing of the Employer's Insolvency. If a person claiming to
be a creditor of the Employer alleges in writing to the
Trustee that the Employer has become Insolvent, the Trustee
shall determine whether the Employer is Insolvent and, pending
such determination, the Trustee shall discontinue payment of
benefits to Plan participants or their beneficiaries.
(ii) Unless the Trustee has actual knowledge of the Employer's
Insolvency, or has received notice from the Employer or a
person claiming to be a creditor alleging that the Employer is
Insolvent, the Trustee shall have no duty to inquire whether
the Employer is Insolvent. The Trustee may in all events rely
on such evidence concerning the Employer's solvency as may be
furnished to the Trustee and that provides the Trustee with a
reasonable basis for making a determination concerning the
Employer's solvency.
(iii) If at any time the Trustee has determined that the Employer is
Insolvent, the Trustee shall discontinue payments to Plan
participants or their beneficiaries and shall hold the assets
of the Trust for the benefit of the Employer's general
creditors. Nothing in this Trust shall in any way diminish any
rights of Plan participants or their beneficiaries to pursue
their rights as general creditors of the Employer with respect
to benefits due under the Plan(s) or otherwise.
(iv) The Trustee shall resume the payment of benefits to Plan
participants or their beneficiaries in accordance with Section
2 of this Trust only after the Trustee has determined that the
Employer is not Insolvent (or is no longer Insolvent).
(c) Provided that there are sufficient assets, if the Trustee
discontinues the
payment of benefits from the Trust pursuant to Section 3(b) hereof
and subsequently resumes such payments, the first payment following
such discontinuance shall include the aggregate amount of all
payments due to Plan participants or their beneficiaries under the
terms of the Plan for the period of such discontinuance, less the
aggregate amount of any payments made to Plan participants or their
beneficiaries by the Employer in lieu of the payments provided for
hereunder during any such period of discontinuance.
4. PAYMENTS TO EMPLOYER. Except as provided in Section 3 hereof, after the
Trust has become irrevocable, the Employer shall have no right or power to
direct the Trustee to return to the Employer or to divert to others any of
the Trust assets before all payment of benefits have been made to Plan
participants and their beneficiaries pursuant to the terms of the Plan.
5. INVESTMENT AUTHORITY.
(a) The Trustee may invest in securities (including stock or rights to
acquire stock) or obligations issued by the Employer. All rights
associated with assets of the Trust shall be exercised by the
Trustee or the person designated by the Trustee, and shall in no
event be exercisable by or rest with Plan participants, except that
voting rights with respect to Trust assets will be exercised by the
Employer.
(b) The Employer shall have the right at any time, and from time to time
in its sole discretion, to substitute assets of equal fair market
value for any assets held by the Trust. This right is exercisable by
the Employer in a nonfiduciary capacity without the approval or
consent of any person in a fiduciary capacity.
(c) The trustee shall invest the principal of the Trust and any earnings
thereon in accordance with written directions from the Employer.
Such directions shall
provide Trustee with the investment discretion to invest the above
referenced amounts within the broad guidelines established by
Trustee and Employer as set forth therein.
6. DISPOSITION OF INCOME. During the term of this Trust, all income received
by the Trust, net of expenses and taxes, shall be accumulated and
reinvested.
7. ACCOUNTING BY TRUSTEE. The Trustee shall keep accurate and detailed
records of all investments, receipts, disbursements, and all other
transactions required to be made, including such specific records as shall
be agreed upon in writing between the Employer and the Trustee. Within
sixty (60) days following the close of each calendar year and within sixty
(60) days after the removal or resignation of the Trustee, the Trustee
shall deliver to the Employer a written account of its administration of
the Trust during such year or during the period from the close of the last
preceding year to the date of such removal or resignation, setting forth
all investments, receipts, disbursements and other transactions effected
by it, including a description of all securities and investments purchased
and sold with the cost or net proceeds of such purchases or sales (accrued
interest paid or receivable being shown separately), and showing all cash,
securities and other property held in the Trust at the end of such year or
as of the date of such removal or resignation as the case may be.
8. RESPONSIBILITY OF TRUSTEE.
(a) The Trustee shall act with the care, skill, prudence and diligence
under the circumstances then prevailing that a prudent person acting
in a like capacity and familiar with such matters would use in the
conduct of an enterprise of a like character and with like aims,
provided, however, that the Trustee shall incur no liability to any
person for any action taken pursuant to a direction, request or
approval given by the Employer which is contemplated by, and in
conformity with, the terms of the Plan or this Trust and is given in
writing by
the Employer. In the event of a dispute between the Employer and a
party, the Trustee may apply to a court of competent jurisdiction to
resolve the dispute.
(b) If the Trustee undertakes or defends any litigation arising in
connection with this Trust (other than litigation arising out of the
Trustee's negligence or willful misconduct, or failure to perform
its duties under the Trust), the Employer agrees to indemnify the
Trustee against Trustee's costs, expenses and liabilities
(including, without limitation, attorneys' fees and expenses)
relating thereto and to be primarily liable for such payments. If
the Employer does not pay such costs, expenses and liabilities in a
reasonably timely manner, the Trustee may obtain payment from the
Trust.
(c) The Trustee may consult with legal counsel (who may also be counsel
for the Employer generally) with respect to any of its duties or
obligations hereunder.
(d) The Trustee may hire agents, accountants, actuaries, investment
advisors, financial consultants or other professionals to assist it
in performing any of its duties or obligations hereunder.
(e) The Trustee shall have, without exclusion, all powers conferred on
trustees by applicable law, unless expressly provided otherwise
herein, provided, however, that if an insurance policy is held as an
asset of the Trust, the Trustee shall have no power to name a
beneficiary of the policy other than the Trust, to assign the policy
(as distinct from conversion of the policy to a different form)
other than to a successor Trustee, or to loan to any person the
proceeds of any borrowing against such policy.
(f) However, notwithstanding the provisions of Section 8(e) above, the
Trustee may loan to the company the proceeds of any borrowing
against an insurance policy held as an asset of the Trust.
(g) Notwithstanding any powers granted to the Trustee pursuant to this
Trust or to applicable law, the Trustee shall not have any power
that could give this Trust the objective of carrying on a business
and dividing the gains therefrom, within the meaning of section
301.7701-2 of the Procedure and Administrative Regulations
promulgated pursuant to the Internal Revenue Code.
(h) The Trustee shall indemnify and hold harmless the Company, its
officers, employees and agents from and against all liabilities,
losses and claims (including reasonable attorney's fees and costs of
defense) to the extent that such liabilities losses and claims
result, directly or indirectly, from the Trustee's breach of this
Trust agreement, breach of fiduciary, negligence or willful
misconduct.
9. COMPENSATION AND EXPENSES OF THE TRUSTEE. The Employer shall pay all
reasonable administrative and Trustee's fees and expenses. If not so paid,
the fees and expenses shall be paid from the Trust.
10. RESIGNATION AND REMOVAL OF TRUSTEE.
(a) The Trustee may resign at any time by written notice to the
Employer, which shall be effective thirty (30) days after receipt of
such notice unless the Employer and the Trustee agree otherwise.
(b) The Trustee may be removed by the Employer upon thirty (30) days
notice or upon shorter notice accepted by the Trustee.
(c) Upon resignation or removal of the Trustee and appointment of a
successor Trustee, all assets shall subsequently be transferred to
the successor Trustee. The transfer shall be completed within sixty
(60) days after receipt of notice of resignation, removal or
transfer, unless the Employer extends the time limit.
(d) If the Trustee resigns or is removed, a successor shall be
appointed, in accordance with Section 11 hereof, by the effective
date of the resignation or removal under paragraph (a) or (b) of
this section. If no such appointment has been made, the Trustee may
apply to a court of competent jurisdiction for appointment of a
successor or for instructions. All expenses of the Trustee in
connection with the proceeding shall be allowed as administrative
expenses of the Trust.
11. APPOINTMENT OF SUCCESSOR.
(a) If the Trustee resigns (or is removed) in accordance with Section
10(a) or (b) hereof, the Employer may appoint any third party, such
as a bank trust department or other party that may be granted
corporate trustee powers under state law, as a successor to replace
the Trustee upon resignation or removal. The appointment shall be
effective when accepted in writing by the new Trustee, who shall
have all of the rights and powers of the former Trustee, including
ownership rights in the Trust assets. The former Trustee shall
execute any instrument necessary or reasonably requested by the
Employer or the successor Trustee to evidence the transfer.
(b) The successor Trustee need not examine the records and acts of any
prior Trustee and may retain or dispose of existing Trust assets,
subject to Sections 7 and 8 hereof. The successor Trustee shall not
be responsible for and the Employer shall indemnify and defend the
successor Trustee from any claim or liability resulting from any
action or inaction of any prior Trustee or from any other past
event, or any condition existing at the time it becomes successor
Trustee.
12. AMENDMENT OR TERMINATION.
(a) This Trust may be amended by a written instrument executed by the
Trustee and the Employer. Notwithstanding the foregoing, no such
amendment shall conflict with the terms of the Plan or shall make
the Trust revocable after it has become irrevocable in accordance
with Section 1(b) hereof.
(b) This Trust shall not terminate until the date on which Plan
participants and their beneficiaries are no longer entitled to
benefits pursuant to the terms of the Plan. Upon termination of this
Trust any assets remaining in this Trust shall be returned to the
Employer.
(c) Upon written approval of participants or beneficiaries entitled to
payment of benefits pursuant to the terms of the Plan, the Employer
may terminate this Trust prior to the time all benefit payments
under the Plan have been made. All assets in the Trust at
termination shall be returned to the Employer.
13. MISCELLANEOUS.
(a) Any provision of this Trust prohibited by law shall be ineffective
to the extent of any such prohibition, without invalidating the
remaining provisions hereof.
(b) Benefits payable to Plan participants and their beneficiaries under
this Trust may not be anticipated, assigned (either at law or in
equity), alienated, pledged, encumbered or subjected to attachment,
garnishment, levy, execution or other legal or equitable process.
(c) This Trust shall be governed by and construed in accordance with the
laws of the State of Illinois.
(d) For purposes of this Trust, Change of Control shall mean, and be
deemed to have occurred, on the date of the first to occur any of
the following:
(i) upon the vote of the shareholders of Xxxxxx Capital approving
a merger or consolidation in which the Company's shareholders
immediately prior to the effective time of the merger or
consolidation will beneficially own immediately after the
effective time of the merger or consolidation securities of
the surviving or new corporation having less than 50% of the
"voting power" of the surviving or new corporation, including
"voting power" exercisable on a contingent or deferred basis
as well as immediately exercisable "voting power"; provided,
however, that no such merger or consolidation shall constitute
a "change of control" in the event that following such
transaction the Xxxxxx Family (as defined below) owns,
directly or indirectly, 30% or more of the combined "voting
power" of the surviving or new corporation's outstanding
securities, excluding "voting power" exercisable on a
contingent or deferred basis; or
(ii) upon the consummation of a sale, lease, exchange or other
transfer or disposition by Xxxxxx Capital of all or
substantially all of the assets of the Company on a
consolidated basis, provided, however, that the mortgage,
pledge or hypothecation of all or substantially all of the
assets of the Company on a consolidated basis, in connection
with a bona fide financing shall not constitute a Change of
Control; or
(iii) when any "person" (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934) is or becomes
the "beneficial owner" (as defined in Rule 13d-3 of the
Securities Exchange Act as in effect on date hereof, but
excluding (a) any Company sponsored employee benefit plan and
(b) any member of the Xxxxxx Family),
directly or indirectly, of shares of Company stock such that
the Xxxxxx Family holds less than 30% of the combined "voting
power" of the Company's then outstanding securities, excluding
"voting power" exercisable on a contingent or deferred basis.
For purposes of this Trust, the Xxxxxx Family means (i) Xxxxxx Xxxxxx and
Xxxx Xxxxxx, (ii) a descendant of Xxxxxx Xxxxxx and Xxxx Xxxxxx, (iii) any
estate, trust, guardianship or custodianship for the primary benefit of an
individual described in (i) or (ii) above, or (iv) a proprietorship,
partnership, limited liability company, or corporation controlled by and
substantially all the interest in which are owned, directly or indirectly,
by one or more individuals or entities described in (i), (ii), or (iii)
above.
14. EFFECTIVE DATE. The effective date of this Trust shall be April 1, 2001.
Attest: Xxxxxx Capital Group, Inc.
________________________________ By: ________________________________
Secretary Name and Title
Allfirst Trust Company
By: ________________________________
Name and Title
