EXHIBIT 10.1(l)
SENSIENT TECHNOLOGIES CORPORATION
RABBI TRUST "A" AGREEMENT
This Trust Agreement is made effective as of the 1st day of January, 2001 by and
between Universal Foods Corporation d/b/a Sensient Technologies Corporation and
effective upon shareholders approval to be known as Sensient Technologies
Corporation, a Wisconsin corporation (the "Company"), and Xxxxxxxx & Xxxxxx
Trust Company (the "Trustee").
WHEREAS, the Company is obligated in accordance with the terms of various
agreements listed on Appendix A, as the same may be amended from time-to-time
(collectively the "Contracts"), to make certain payments for the benefit of
selected Company executives (the "Executives") in the event of a change of
control of the Company; and
WHEREAS, as the Company has incurred or expects to incur liability under the
terms of such Contracts, the Company established a trust (the "Trust") and
entered into a trust agreement dated September 1, 2000 (the "Prior Trust
Agreement") with Firstar Bank, Milwaukee, N.A., as trustee (the "Prior
Trustee"), with the intention that the Company would make contributions to such
Trust to provide itself with a source of funds to assist it in meeting its
liabilities under the Contracts (the "Executives"); and
WHEREAS, it is the intention of the Company that the Trust shall constitute an
unfunded arrangement and shall not affect the status of any Contract as an
unfunded plan maintained for the purpose of providing deferred compensation for
a select group of management or highly compensated employees for purposes of
Title I of the Employee Retirement Income Security Act of 1974, as amended; and
WHEREAS, the Company has appointed the Trustee to succeed the Prior Trustee of
the Trust effective as of January 1, 2001; and
WHEREAS, the Prior Trust Agreement is revocable by the Company because the Trust
has not been funded due to a change of control as provided therein; and
WHEREAS, the Company and the Trustee desire to amend and restate the Trust
Agreement (hereinafter the "Trust Agreement") to enable the Trustee to
administer all of the assets held by the Prior Trustee in the Trust, subject to
the claims of the Company's creditors in the event the Company becomes
Insolvent, as herein defined, until the Company's obligations are paid in
accordance with the terms of the Contracts; and
NOW, THEREFORE, in consideration of the mutual agreements of the parties as
contained in this Trust Agreement, the Trust shall be comprised, held and
disposed of as follows:
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Section 1. Successor Trust
(a) The Company and Trustee hereby acknowledge the deposit with the
Trustee of assets previously held under the Prior Trust Agreement, which shall
continue as the principal of the Trust.
(b) The Trust shall become irrevocable upon a Change of Control, as
defined herein.
(c) The Trust is intended to be a grantor trust, of which the
Company is the grantor, within the meaning of subpart E, part 1, subchapter J,
chapter 1, subtitle A of the Internal Revenue Code of 1986, as amended, and
shall be construed accordingly.
(d) The principal of the Trust, and any earnings thereon shall be
held separate and apart from other funds of the Company and shall be used
exclusively for the uses and purposes of paying benefits to Executives as
required by the Contracts and claims of general creditors, as herein set forth.
Executives shall have no preferred claim on, or any beneficial ownership
interest in, any assets of the Trust. Any rights created under the Contracts and
this Trust Agreement shall be mere unsecured contractual rights of Executives
against the Company. Any assets held by the Trust will be subject to the claims
of the Company's general creditors under federal and state law in the event the
Company is Insolvent, as defined in Section 3(a) herein.
(e) The Company, in its sole discretion, may at any time, or from
time to time, make additional deposits of cash or other property in trust with
the Trustee to augment the principal to be held, administered and disposed of by
the Trustee as provided in this Trust Agreement. Neither the Trustee nor any
Executive shall have any right to compel such additional deposits.
(f) Upon a Change of Control as defined herein, the Company shall,
within five (5) business days following the Change of Control, make an
irrevocable contribution to the Trust in an amount that is sufficient to pay the
Executives the benefits to which Executives would be entitled pursuant to the
terms of the Contract(s) as of the date on which the Change of Control occurred;
provided, however, payment of benefits through this Rabbi Trust A shall not
duplicate any benefits payable to Executives through Rabbi Trust B or C (which
provide for payment of benefits for several non-qualified benefit plans of the
Company) or any other irrevocable trust arrangement providing for secured
payment of benefits to Executives, notwithstanding that the benefits shall be
payable upon a Change of Control pursuant to the terms of the Contracts.
Section 2. Payments to Executives
(a) Upon a Change of Control, within five (5) business days
following such Change of Control, the Company shall deliver to the Trustee a
schedule (the "Payment Schedule") that indicates the amounts payable in respect
of each Executive, that provides a formula or other instructions acceptable to
Trustee for determining the amounts so payable, the form in which such amount is
to be paid (as provided for under the Contracts), and the time of
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commencement for payment of such amounts. Except as otherwise provided herein,
the Trustee shall make payments to the Executives in accordance with such
Payment Schedule. The Trustee shall make provision for the reporting and
withholding of any federal, state or local taxes that may be required to be
withheld with respect to the payment of benefits pursuant to the terms of the
Contracts and shall pay amounts withheld to the appropriate taxing authorities
or determine that such amounts have been reported, withheld and paid by the
Company.
(b) The entitlement of an Executive to benefits under a Contract
shall be determined by the Company or such party as it shall designate, and any
claim for such benefits shall be considered and reviewed under procedures
determined by the Company and uniformly applied.
(c) The Company may make payment of benefits directly to Executives
as they become due under the terms of the Contracts. The Company shall notify
the Trustee of its decision to make payment of benefits directly prior to the
time amounts are payable to Executives. In addition, if the principal of the
Trust, and any earnings thereon, are not sufficient to make payments of benefits
in accordance with the terms of the Contracts, the Company shall make the
balance of each such payment as it falls due. The Trustee shall notify the
Company where principal and earnings are not sufficient.
Section 3. Trustee Responsibility Regarding Payments to Trust Beneficiary
When The Company is Insolvent
(a) The Trustee shall cease payment of benefits to Executives if the
Company is Insolvent. The Company shall be considered "Insolvent" for purposes
of this Trust Agreement if (i) the Company is unable to pay its debts as they
become due, (ii) the Company is subject to a pending proceeding as a debtor
under the United States Bankcruptcy Code, or (iii) the Company is determined to
be insolvent by any state or federal regulatory authority.
(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 Company under federal and state law as set
forth below.
(1) The Board of Directors and the Chief Executive Officer of
the Company shall have the duty to inform the Trustee in writing that the
Company is Insolvent. If a person claiming to be a creditor of the Company
alleges in writing to the Trustee that the Company has become Insolvent, the
Trustee shall determine whether the Company is Insolvent and, pending such
determination, the Trustee shall discontinue payment of benefits to Executives.
(2) Unless the Trustee has actual knowledge that the Company
is Insolvent, or has received notice from the Company or a person claiming to be
a creditor alleging that the Company is Insolvent, the Trustee shall have no
duty to inquire whether the Company is Insolvent. The Trustee may in all events
rely on such evidence concerning whether the Company is Insolvent as may be
furnished to the Trustee and that provides the Trustee with a reasonable basis
for making a determination whether the Company is Insolvent.
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(3) If at any time the Trustee has determined that the Company
is Insolvent, the Trustee shall discontinue payments to Executives and shall
hold the assets of the Trust for the benefit of the Company's general creditors.
Nothing in this Trust Agreement shall in any way diminish any rights of
Executives to pursue their rights as general creditors of the Company with
respect to benefits due under the Contracts or otherwise.
(4) The Trustee shall resume the payment of benefits to
Executives in accordance with Section 2 of this Trust Agreement only after the
Trustee has determined that the Company is not Insolvent (or is no longer
Insolvent).
(c) Provided that there are sufficient assets, if the Trustee
discontinues the payment of benefits from the Trust pursuant to Section 3(b)
hereof and subsequently resumes such payments, the first payment following such
discontinuance shall include the aggregate amount of all payments due to
Executives under the terms of the Contracts for the period of such
discontinuance, less the aggregate amount of any payments made to Executives by
the Company in lieu of the payments provided for hereunder during any such
period of discontinuance.
Section 4. Payments to Company
Except as provided in Section 3 hereof, after a Change of Control,
the Company shall have no right or power to direct the Trustee to return to the
Company, or to divert to others, any of the Trust assets before all payment of
benefits have been made to Executives pursuant to the terms of the Contracts,
except in the case of a termination of the Trust pursuant to Section 12.
Section 5. Investment Authority
(a) Investments of the Trust shall be limited to cash, cash
equivalents and other short time fixed income securities (including any such
security from which the Trustee or an affiliate receives any compensation or
fee). Prior to a Change in Control, the Company shall have sole authority to
direct the Trustee as to such specific securities in which Trustee shall invest
such Trust Fund assets. Following a Change in Control, such powers and authority
regarding investments shall be rest solely with the Trustee who shall invest
such Trust Fund assets in its sole discretion in cash equivalents and other
short time fixed income securities (including any such security from which the
Trustee or an affiliate receives any compensation or fee). In no event shall any
investment authority be exercisable by or rest with Executives; provided that,
voting rights with respect to Trust assets will be exercised by the Company
prior to a Change in Control and will be exercised by the Trustee after a Change
in Control.
(b) The Company shall have the right at anytime, and from time to
time in its sole discretion, to substitute assets of equal fair market value for
any assets held by the Trust. This right is exercisable by the Company in a
nonfiduciary capacity without the approval or consent of any person in a
fiduciary capacity.
(c) The Trustee shall also have the following additional powers:
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(1) To receive and hold all contributions paid to it by the
Company, provided, however, that the Trustee shall have no duty to require any
contributions to be made to it;
(2) To effectuate the written investment instructions given by
the Company or its designee without regard to any law now or hereafter in force
limiting investments of fiduciaries;
(3) To retain in the Trust for investments any property
deposited by the Trustee hereunder;
(4) To have the authority to invest and reinvest assets of the
Trust in cash, cash equivalents and other short time fixed income securities
(including any such security from which the Trustee or an affiliate receives any
compensation or fee);
(5) To retain in the Trust for investment or pending
distributions, any portion of the Trust in cash deemed appropriate by the
Trustee;
(6) To establish accounts in any affiliate of the Trustee and
in such other banks and financial institutions as the Trustee deems appropriate
to carry out the purpose of the Trust;
(7) To deposit securities with a clearing corporation as
defined in Article Eight of the Uniform Commercial Code; to hold the
certificates representing securities, including those in bearer form, in bulk
form with and to merge such certificates into certificates of the same class of
the same issuer which constitutes assets of other accounts or owners, without
certification as to the ownership attached; and to utilize a book-entry system
for the transfer or pledge of securities held by the Trustee or by a clearing
corporation, provided that the records of the Trustee shall indicate the actual
ownership of the securities and other property of the Trust Fund;
(8) To participate in and use the Federal book-entry account
system, a service provided by the Federal Reserve Bank for its member banks for
deposit of Treasury securities; and
(9) To hold securities or property in the name of the Trustee
or its nominee or nominees or in such other form as it determines best with or
without disclosing the Trust relationship, providing the records of the Trust
shall indicate the actual ownership of such securities or other property.
Section 6. Disposition of Income
As determined in the sole discretion of the Company prior to a
Change of Control, all or part of the income received by the Trust, net of
expenses and taxes, shall be returned to the Company, as determined by the
Company. Following a Change in Control, all income shall be accumulated and
reinstated.
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Section 7. Accounting by Trustee
The Trustee shall keep accurate and detailed records of all
investments, receipts, disbursements, and all other transactions required to be
made, including such specific records as shall be agreed upon in writing between
the Company and the Trustee. Within thirty 30 days after the removal or
resignation of the Trustee, the Trustee shall deliver to the Company a written
account of its administration of the Trust during such year or during the period
from the close of the last preceding year to the date of such removal or
resignation, setting forth all investments, receipts, disbursements and other
transactions effected by it, including a description of all securities and
investments purchased and sold with the cost or net proceeds of such purchases
or sales (accrued interest paid or receivable being shown separately), and
showing all cash, securities and other property held in the Trust at the end of
such year or as of the date of such removal or resignation, as the case may be.
Section 8. Responsibility of Trustee
(a) The Trustee shall act with the care, skill, prudence and
diligence under the circumstances then prevailing that a prudent person acting
in like capacity and familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims; provided, however, that the
Trustee shall incur no liability to any person for any action taken pursuant to
a direction, request or approval given by the Company which is contemplated by,
and in conformity with, the terms of the Contracts or this Trust and is given in
writing by the Company. In the event of a dispute between the Company and a
party, the Trustee may apply to a court or competent jurisdiction to resolve the
dispute.
(b) If the Trustee undertakes or defends any litigation arising in
connection with this Trust, the Company agrees to indemnify the Trustee against
the Trustee's costs, expenses and liabilities (including, without limitation,
attorneys' fees and expenses) relating thereto and to be primarily liable for
such payments. If the Company does not pay such costs, expenses and liabilities
in a reasonably timely manner, the Trustee may obtain payment from the Trust.
(c) The Trustee may consult with legal counsel (who may also be
counsel for the Company generally) with respect to any of its duties or
obligations hereunder.
(d) The Trustee may hire agents, accountants, actuaries, investment
advisors, financial consultants or other professionals to assist it in
performing any of its duties or obligations hereunder.
(e) The Trustee shall have, without exclusion, all powers conferred
on Trustees by applicable law, unless expressly provided otherwise herein;
provided, however, that if an insurance policy is held as an asset of the Trust,
the Trustee shall have no power to name a beneficiary of the policy other than
the Trust, to assign the policy (as distinct from conversion of the policy to a
different form) other than to a successor Trustee, or to loan to any person the
proceeds of any borrowing against such policy.
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(f) Notwithstanding any powers granted to the Trustee pursuant to
this Trust Agreement or to applicable law, the Trustee shall not have any power
that could give this Trust the objective of carrying on a business and dividing
the gains therefrom, within the meaning of section 301.7701-2 of the Procedure
and Administrative Regulations promulgated pursuant to the Internal Revenue
Code.
(g) The Company hereby agrees to indemnify and to hold Trustee
harmless from and against all claims, expenses (including reasonable attorney
fees), liabilities, damages, actions or other charges incurred by or assessed
against Trustee, other than on account of Trustee's own gross negligence or
willful misconduct, as a direct or indirect result of anything done or omitted
by Trustee in reliance upon the directions, or absence of directions, of the
Company, any investment advisor or manager, or as a direct or indirect result
of any act or omission of a predecessor trustee or any other person charged
under any agreement affecting the assets of the Trust for investment
responsibility with respect to such assets.
Section 9. Compensation and Expenses of Trustee
The Company shall pay all administrative costs and the Trustee's
fees and expenses. If not so paid, the costs, fees and expenses shall be paid
from the Trust.
Section 10. Resignation and Rein oval of Trustee
(a) The Trustee may resign at any time by written notice to the
Company, which shall be effective no less than thirty (30) days after receipt of
such notice unless the Company and the Trustee agree otherwise.
(b The Trustee may be removed by the Company on fifteen (15) days
notice or upon shorter notice accepted by the Trustee.
(c) Upon resignation or removal of the Trustee and appointment of a
successor Trustee, all assets shall subsequently be transferred to the successor
Trustee. The transfer shall be completed within thirty (30) days after receipt
of notice of resignation, removal or transfer, unless the Company extends such
time limit.
(d) If the Trustee resigns or is removed, a successor shall be
appointed, in accordance with Section 11 hereof, by the effective date of
resignation or removal under paragraphs (a) or (b) of this section. If no such
appointment has been made, the Trustee may apply to a court of competent
jurisdiction for appointment of a successor or for instructions. All expenses of
the Trustee in connection with the proceeding shall be allowed as administrative
expenses of the Trust.
Section 11. Appointment of Successor
If the Trustee resigns or is removed in accordance with Section 10
(a) or (b) hereof, the Company may appoint any third party, such as a bank trust
department or other party that may be granted corporate trustee powers under
state law, as a successor to replace the
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Trustee upon resignation or removal. The appointment shall be effective when
accepted in writing by the new Trustee, who shall have all of the rights and
powers of the former Trustee, including ownership rights in the Trust assets.
The former Trustee shall execute any instrument necessary or reasonably
requested by the Company or the successor Trustee to evidence the transfer.
The successor Trustee need not examine the records and any acts of
any prior Trustee and may retain or dispose of any existing Trust assets,
subject to Sections 7 and 8 hereof. The successor Trustee shall not be
responsible for, and Company shall indemnify and defend the successor Trustee
from, any claim or liability resulting from any action or inaction of any prior
Trustee or from any other past event, or any condition existing at the time it
becomes successor Trustee.
Section 12. Amendment or Termination
(a) Prior to a Change of Control, this Trust Agreement may be
amended by a written instrument executed by the Trustee and the Company.
Notwithstanding the foregoing, no such amendment shall conflict with the terms
of the Contracts or shall make the Trust revocable after it has become
irrevocable in accordance with Section 1(b) hereof.
(b) The Trust shall not terminate until the date on which Executives
are no longer entitled to benefits pursuant to the terms of the Contracts,
unless approved as provided in Section 12(c) hereof
(c) After a Change of Control, upon written approval of Executives
entitled to payment of not less than sixty-five percent (65%) of benefits
payable under the Payment Schedule, the Company may terminate this Trust prior
to the time all benefits payable under the Payment Schedule have been made. All
assets in the Trust at termination shall be returned to the Company.
Section 13. Miscellaneous
(a) Any provision of this Trust Agreement prohibited by law shall be
ineffective to the extent of any such prohibition, without invalidating the
remaining provisions hereof.
(b) Benefits payable to Executives under this Trust Agreement may
not be anticipated, assigned (either at law or in equity), alienated, pledged,
encumbered or subjected to attachment, garnishment, levy, execution or other
legal or equitable process.
(c) This Trust Agreement shall be governed by and construed in
accordance with the laws of Wisconsin.
(d) For purposes of this Trust, Change of Control shall mean:
(1) the acquisition by any individual, entity or group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended) (a "Person") of beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended) of
20% or more of either (A) the then outstanding shares of
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common stock of the Company (the "Outstanding Company Common Stock") or (B) the
combined voting power of the then outstanding voting securities of the Company
entitled to vote generally in the election of directors (the "Outstanding
Company Voting Securities"); provided, however, that for purposes of this
subsection (1), the following acquisitions shall not constitute a Change of
Control: (I) any acquisition directly from the Company, (II) any acquisition by
the Company, (III) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by the Company or any corporation controlled by
the Company or (IV) any acquisition pursuant to a transaction which complies
with clauses (A), (B) and (C) of subsection (3) of this paragraph (d); or
(2) individuals who, as of January 1, 2001, constitute the
Board of Directors (the "Incumbent Board") cease for any reason to constitute at
least a majority of the Board of Directors; provided, however, that any
individual becoming a director subsequent to January 1, 2001 whose election, or
nomination for election by the Company's shareholders, was approved by a vote of
at least a majority of the directors then comprising the Incumbent Board shall
be considered as though such individual were a member of the Incumbent Board,
but excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board of Directors; or
(3) consummation by the Company of a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of the
assets of the Company or the acquisition of assets of another entity (a
"Business Combination"), in each case, unless, following such Business
Combination, (A) all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the Outstanding Company Common
Stock and Outstanding Company Voting Securities immediately prior to such
business combination beneficially own, directly or indirectly, more than 50% of,
respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns the Company or all or
substantially all of the Company's assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership
immediately prior to such Business Combination of the Outstanding Company Common
Stock and Outstanding Company Voting Securities, as the case may be, (B) no
Person (excluding any employee benefit plan (or related trust) of the Company or
of such corporation resulting from such Business Combination) beneficially owns,
directly or indirectly, 20% or more of, respectively, the then outstanding
shares of common stock of the corporation resulting from such Business
Combination or the combined voting power of the then outstanding voting
securities of such corporation except to the extent that such ownership existed
prior to the Business Combination and (C) at least a majority of the members of
the board of directors of the corporation resulting from such Business
Combination were members of the Incumbent Board at the time of the execution of
the initial agreement, or the action of the Board, providing for such Business
Combination; or
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(4) approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company.
Section 14. Effective Date
The effective date of this Trust Agreement shall be January 1, 2001.
IN WITNESS WHEREOF, the Company and Trustee have caused this Trust Agreement to
be duly executed as of the Effective Date indicated above.
UNIVERSAL FOODS CORPORATION d/b/a
SENSIENT TECHNOLOGIES CORPORATION
By: /s/: Xxxx X. Xxxxxxx
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Title: Vice President, Secretary & General Counsel
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Attest: /s/ Xxxxxxx Xxxxxxx
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Title: Vice President & Treasurer
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XXXXXXXX & XXXXXX TRUST COMPANY
By: /s/: Xxxxxxx X. Xxxxxxxx
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Title: Vice President
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Attest: /s/ Xxxxxxx X. Xxxxxx
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Title: Vice President
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Appendix A
SENSIENT TECHNOLOGIES CORPORATION
RABBI TRUST "A" AGREEMENT
1. Executive Employment Contract, dated November 5, 1987, as amended May 10,
1988, by and between Universal Foods Corporation and Xxxxxxx X. Xxxxxxx.
2. Change of Control and Severance Agreements entered into between Sensient
Technologies and certain Executives from time to time, benefits under
which are to be provided to the Trustee upon a Change of Control, as
provided in Section 2 of the Trust Agreement.
