Exhibit 10.3
EXECUTION COPY
TRUST AGREEMENT FOR THE
DEFERRAL PLAN FOR
SENIOR EXECUTIVE OFFICERS OF
TRIARC COMPANIES, INC.
Triarc Companies, Inc., a Delaware corporation (the "Company"), and
Wilmington Trust Company, a Delaware bank and trust company ("Trustee"), have as
of January 23, 2001 (the "Effective Date") entered into this grantor trust
agreement ("Trust Agreement"), established under the Deferral Plan for Senior
Executive Officers of Triarc Companies, Inc., a copy of which is attached
hereto, as amended, supplemented or restated from time to time (the "Plan"), as
herein set forth.
WHEREAS, Company has adopted the Plan;
WHEREAS, Company has incurred or expects to incur liability under
the terms of the Plan with respect to Xxxxxx Xxxxx (the "Participant") who is an
individual participating in the Plan;
WHEREAS, Company wishes to establish a trust, which shall be known
as the "Triarc Companies, Inc. Deferral Plan Trust" (the "Trust"), and to
contribute to the Trust assets that shall be held therein, subject to the claims
of Company's creditors in the event of Company's "Insolvency," as herein
defined, until paid to the Participant or his beneficiary(ies), as the case may
be, 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, if the Plan is determined to be subject
to the Employee Retirement Income Security Act of 1974 ("ERISA"), that this
Trust 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 ERISA;
WHEREAS, it is the intention of Company to make contributions to the
Trust to provide the Trust with a source of funds to assist it in the meeting of
its liabilities under the Plan;
NOW, THEREFORE, the parties do hereby establish the Trust and agree
that the Trust shall be comprised, held and disposed of as follows:
Section 1. Establishment of Trust
(a) Company hereby deposits with Trustee in trust $15.0 million, which
shall become the principal of the Trust to be held, administered and disposed of
by the Trustee as provided in this Trust Agreement.
(b) The Trust hereby established shall be irrevocable.
(c) The Trust is intended to be a grantor trust, of which the Company is
the grantor, within the meaning of subpart E, part I, subchapter J, chapter 1,
subtitle A of the Internal Revenue Code of 1986, as amended (the "Code"), and
shall be construed accordingly.
(d) The principal of the Trust, and any earnings thereon (the "Trust Fund")
shall be held separate and apart from the Company's other funds and shall be
used exclusively for the uses and purposes of the Participant and Company's
general creditors as herein set forth. The Participant and his beneficiary(ies)
shall have no preferred claim on, or any beneficial ownership interest in, any
assets of the Trust. Any rights created under the Plan and this Trust Agreement
shall be mere unsecured contractual rights of the Participant and his
beneficiary(ies) 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) 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 the Participant and
his beneficiary(ies) shall have any right or duty to compel such additional
deposits or determine the sufficiency thereof.
(f) If the Plan is determined to be subject to ERISA, the Company shall use
reasonable commercial efforts at all times to cause the Plan and this Trust to
have characteristics supporting a determination that it is an arrangement
constituting an unfunded Plan maintained for the purpose of providing deferred
compensation to a select group of management or highly compensated employees for
purposes of Title I of ERISA.
Section 2. Payments to Participant and His Beneficiary(ies).
(a) Company shall deliver to the Trustee a schedule (the "Payment
Schedule") that (i) indicates the amounts payable in respect of the Participant
and his beneficiary(ies), and (ii) 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 or available under the Plan), and the
time of commencement for payment of such amounts. The Trustee acknowledges that
the information described in clause (ii) of the preceding sentence is directly
or indirectly (through actions of the Committee provided for under the Plan
document) contained in such Plan document, as it may be amended from time to
time, which shall constitute the Payment Schedule for this purpose; provided,
however, that the Company (directly or through the Committee) shall be
responsible for promptly notifying the Trustee in writing of any event,
including, without limitation, any Participant election or Committee action or
exercise of discretion, affecting the timing, amount or composition of any
payment to the Participant and his beneficiary(ies) under the Plan. Except as
otherwise provided herein, Trustee shall make payments to the Participant and
his beneficiary(ies) in accordance with the Payment Schedule. The Company shall
provide in writing to the Trustee any and all information the Trustee reasonably
believes necessary for the Trustee or its agent to make any determination as to
payments to the Participant and his beneficiary(ies), tax reporting, tax
withholding or otherwise not less than thirty (30) calendar days prior to the
time the payments must be made, or as soon as practicable thereafter if the
event causing the payment obligation was not reasonably foreseeable by the
Company prior to such 30-day period. The Trustee or its agent shall not be
required to make any such determination for which the Company has not provided
information requested by the Trustee.
(b) The Trustee shall make provision for the reporting and withholding of
any federal taxes that may be required to be withheld with respect to the
payment of benefits from the Trust Fund pursuant to the terms of the Plan and
shall pay amounts withheld to the appropriate taxing authorities or determine
that such amounts have been reported, withheld and paid by the Company. The
Trustee shall make provision for the reporting and withholding of any state or
local taxes that may be required with respect to the payment of benefits only as
directed by the Company.
(c) The Company shall from time to time pay taxes of any and all kinds
whatsoever that at any time are lawfully levied or assessed upon or become
payable in respect of the Trust Fund, the income or any property forming a part
thereof or any security transaction pertaining thereto. To the extent that any
taxes lawfully levied or assessed upon the Trust Fund are not paid by the
Company, the Trustee shall have the power to pay such taxes out of the Trust
Fund and shall seek reimbursement from the Company. Prior to making any payment,
the Trustee may require such releases or other documents from any lawful taxing
authority, as it shall deem necessary. The Trustee shall contest the validity of
taxes in any manner deemed appropriate by the Company or its counsel, but at the
Company's expense, and only if it has received an indemnity bond or other
security satisfactory to it to pay any such expenses. The Trustee shall not be
liable for any non-payment of tax when it distributes an interest hereunder on
directions from the Company.
(d) In the case of any dispute as to the payment of benefits from the Trust
Fund pursuant to the terms of the Plan, the entitlement of the Participant or
his beneficiary(ies) to benefits under the Plan shall be determined by the
Company 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. Any such determination by the Company or such party shall be provided
to the Trustee in writing not less than five (5) business days (or as soon
thereafter as practicable) prior to the time by which the Trustee must act
thereupon. The Trustee or its agent shall not be required to make any such
determination.
(e) The Company may make payment of benefits directly to the Participant or
his beneficiary(ies) as they become due under the terms of the Plan. The Company
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 Company shall make the balance of each such payment as it falls due.
At least five (5) business days prior to any scheduled payment, the Trustee
shall notify the Company, in writing, where principal and earnings are not
sufficient to make scheduled payment.
Section 3. Trustee Responsibility Regarding Payments to Trust
Beneficiary When Company is Insolvent.
(a) The Trustee shall cease payment of benefits to the Participant and his
beneficiary(ies) if the Company is "Insolvent." The Company shall be considered
"Insolvent" for purposes of this Trust Agreement (i) if the Company is unable to
pay its debts as they become due, or (ii) while the Company 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 Company under federal and state law as set
forth below.
(1) The Company's Board of Directors acting in such capacity, and any
Executive Vice President who is not a Plan participant or, if none, any
Senior Vice President who is not a Plan participant or, if none, any Vice
President who is not a Plan participant (the "Ranking Officer"), shall
have the duty to inform the Trustee in writing of the Company's
Insolvency. If a person claiming to be a creditor of the Company notifies
the Trustee that the Company has become Insolvent, the Trustee shall
provide the Board of Directors with a copy of such writing and absent the
Company's provision of an independent expert's opinion reasonably
satisfactory to the Trustee that the Company is not Insolvent, the Trustee
shall discontinue payment of benefits to the Participant or his
beneficiary(ies).
(2) Unless the Trustee has actual knowledge of the Company's Insolvency,
or has received notice from a member of the Company's Board of Directors
or the Ranking Officer 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.
(3) If at any time the Trustee has received a written notice containing
information or allegations described in Section 3(b)(1) that the Company
is Insolvent, the Trustee shall discontinue payments to the Participant or
his beneficiary(ies) and shall hold the assets of the Trust for the
benefit of the Company's general creditors (including the Participant or
his beneficiary(ies)) until such time as it is determined that the Company
is not Insolvent as provided in 3(b)(1) above. Nothing in this Trust
Agreement shall in any way diminish any rights of the Participant or his
beneficiary(ies) to pursue their rights as general creditors of the
Company with respect to benefits due under the Plan or otherwise.
(4) The Trustee shall resume the payment of benefits to the Participant
or his beneficiary(ies) in accordance with Section 2 of this Trust
Agreement only after it has been demonstrated to the Trustee's reasonable
satisfaction 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 the
Participant or his beneficiary(ies) under the terms of the Plan for the period
of such discontinuance, less the aggregate amount of any payments made to
Participant or his beneficiary(ies) by the Company in lieu of (but not in
addition to) the payments provided for hereunder during any such period of
discontinuance.
Section 4. Payments to the Company.
Except as provided in Section 3 hereof, 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 payments of benefits have been made to the
Participant and his beneficiary(ies) pursuant to the terms of the Plan.
Section 5. Investment Authority.
The Trustee shall have, without exclusion, all powers conferred on the
Trustee by applicable law, unless expressly provided otherwise herein, and all
rights associated with assets of the Trust shall be exercised by the Trustee,
and shall in no event be exercisable by or rest with the Participant. The
Trustee shall have full power and authority to invest and reinvest the Trust
Fund in any investment permitted by law, exercising the judgment and care that
persons of prudence, discretion and intelligence would exercise under the
circumstances then prevailing considering the probable income and safety of
their capital, including, without limiting the generality of the foregoing, the
power:
(a) To invest and reinvest the Trust Fund, together with the income
therefrom, in common stock, membership or partnership interests, preferred
stock, mutual or hedge funds, bonds, mortgages, notes, time certificates of
deposit, commercial paper and other evidences of indebtedness (including those
issued by the Trustee or any of its affiliates), other securities, policies of
life insurance, annuity contracts, options to buy or sell securities or other
assets, and other property of any kind (personal, real or mixed, and tangible or
intangible);
(b) To deposit or invest all or any part of the assets of the Trust Fund in
savings accounts or certificates of deposit or other deposits which bear a
reasonable interest rate in a bank, including the commercial department of the
Trustee, if such bank is supervised by the United States or any state;
(c) To hold, manage, improve and control all property, real or personal,
forming part of the Trust Fund and to sell, convey, transfer, exchange,
partition, lease for any term, even extending beyond the duration of this Trust,
and otherwise dispose of the same from time to time in such manner, for such
consideration and upon such terms and conditions as the Trustee shall determine;
(d) To have, respecting securities, all the rights, powers and privileges
of an owner, including the power to give proxies, pay assessments and other sums
deemed by the Trustee to be necessary for the protection of the Trust Fund, to
vote any corporate stock either in person or by proxy, with or without power of
substitution for any purpose. To participate in voting trusts, pooling
agreements, foreclosures, reorganizations, consolidations, mergers and
liquidations and, in connection therewith, to deposit securities with and
transfer title to any protective or other committee under such terms as the
Trustee may deem advisable; to exercise or sell stock subscriptions or
conversion rights; and regardless of any limitation elsewhere in this document
relative to investment by the Trustee, to accept and retain as an investment any
securities or other property received through the exercise of any of the
foregoing powers;
(e) To hold in cash, without liability for interest, such portion of the
Trust Fund which, in its discretion, shall be reasonable under the
circumstances, pending investments or payments of expenses, or the distribution
of benefits;
(f) To take such actions as may be necessary or desirable to protect the
Trust Fund from loss due to the default on mortgages held in the Trust including
the appointment of agents or trustees in such other jurisdictions as may seem
desirable, to transfer property to such agents or trustees, to grant such powers
as are necessary or desirable to protect the Trust or its assets, to direct such
agents or trustees, or to delegate such power to direct and to remove such
agents or trustees;
(g) To employ such agents, including investment advisors, custodians,
sub-custodians and counsel as may be reasonably necessary and to pay them
reasonable compensation; to settle, compromise or abandon all claims and demands
in favor of or against the Trust assets;
(h) To cause title to property of the Trust to be issued, held or
registered in the individual name of the Trustee or in the name of its
nominee(s) or agents, or in such form that title will pass by delivery;
(i) To exercise all of the further rights, powers, options and privileges
granted, provided for or vested in trustees generally under the laws of the
State of New York, so that powers conferred upon the Trustee herein shall not be
in limitation of any authority conferred by law, but shall be in addition
thereto;
(j) To borrow money from any source (including the Trustee) and to execute
promissory notes, mortgages, or other obligations and to pledge or mortgage any
Trust assets as security;
(k) To lend certificates representing stocks, bonds, or other securities to
any brokerage or other firm selected by the Trustee;
(l) To use securities, depositories or custodians and to allow such
securities as may be held by a depository or custodian to be registered in the
name of such depository or its nominee or in the name of such custodian or its
nominee;
(m) To invest the Trust Fund from time to time in one or more investment
funds, which funds shall be registered under the Investment Company Act of 1940
(including companies with respect to which the Trustee or an affiliate is the
investment adviser or provides other services for which it is compensated by the
funds, and which compensation shall be in addition to the compensation of the
Trustee hereunder);
(n) To invest in securities (including stock or rights to acquire stock) or
obligations issued by Company; and
(o) To do all other acts necessary or desirable for the proper
administration of the Trust Fund, as if the Trustee were the absolute owner
thereof. However, nothing in this section shall be construed to mean the Trustee
assumes any responsibility for the performance of any investment made by the
Trustee in its capacity as trustee under this Trust Agreement. Notwithstanding
any powers granted to the Trustee pursuant to this Trust Agreement or applicable
law, the Trustee shall not have any power that could give this Trust the
objective of carrying on a business and dividing the gains therefrom within the
meaning of Section 301.7701-2 of the Procedure and Administrative Regulations
promulgated pursuant to the Code.
All rights associated with assets of the Trust Fund shall be
exercised by the Trustee or the person designated by the Trustee, and shall in
no event be exercisable by or rest with the Participant. The Company 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 asset held by the Trust.
This right is exercisable by Company in a nonfiduciary capacity without the
approval or consent of any person in a fiduciary capacity.
Notwithstanding anything in the foregoing provisions of this Section
5 to the contrary, the Trustee shall invest the assets of the Trust Fund and
take all investment-related actions, including, without limitation, all actions
pursuant to clause (d) above, as directed in writing by (i) an investment
manager appointed by the Company pursuant to Section 2.2 of the Plan, or (ii) as
to any assets of the Trust Fund as to which no such investment manager has been
appointed, the Company. The Trustee shall not be responsible for (i) determining
the appropriateness of any direction set forth in clause (i) or (ii) of the
preceding sentence or (ii) failing to act with respect to the investment of the
assets of the Trust Fund in the absence of direction from the Company or an
investment manager appointed by the Company pursuant to Section 2.2 of the Plan;
provided, however, that, except as otherwise directed by the Company or an
investment manager appointed by the Company pursuant to Section 2.2 of the Plan,
the Trustee may invest idle cash in a readily liquid short-term investment,
including, without limitation, in any money market mutual fund described in
Section 5(m) above within the Wilmington family of mutual funds. The Trustee and
the Company acknowledge that the intent of the parties is that the investment of
the assets of the Trust match the deemed investments of the "Deferred Bonus
Account" (as defined in the Plan) on the books and records of the Company
attributable thereto.
Section 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.
Section 7. Accounting by the 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 60 days following the close of each calendar
year and such other times as the Company may request (but not more frequently
than once per calendar month) and within 60 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 the 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 or its Board of Directors
which is contemplated by, and in conformity with, the terms of the Plan or this
Trust Agreement and is given in writing by the Company or its Board of
Directors. In the event of a dispute between the Company 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 administrative, adversarial or
other litigation or proceeding or enforcement action arising in connection with
this Trust, including, without limitation, any successful action against the
Company to enforce the indemnification provisions of this Trust Agreement, the
Company agrees to indemnify the Trustee against the Trustee's costs, expenses
and liabilities (including without limitation, reasonable attorney's fees and
expenses) relating thereto and the Company shall be primarily liable for such
payments. Moreover, the Company shall indemnify and hold the Trustee harmless
from and against all loss or liability (including expenses and reasonable
attorneys' fees), to which it may be subject by reason of its execution of its
duties under this Trust Agreement, or by reason of any acts taken in good faith
in accordance with any directions, or acts omitted in good faith due to absence
of directions, from the Company or the Committee unless, and only to the extent,
such loss or liability is due to the Trustee's gross negligence or willful
misconduct. The Company will, upon notice, pay monthly in arrears to or on
behalf of the Trustee, all reasonable attorneys' fees and expenses incurred by
the Trustee. If the Company does not pay such costs, expenses and liabilities in
a reasonably timely manner, the Trustee may obtain payment from the Trust
without notice to any party. If the Trustee receives notice of the assertion of
any claim or of the commencement of any action or proceeding against the Trustee
by any person other than the Company or an affiliate of the Company (a "Third
Party Claim"), the Trustee will give the Company reasonable prompt written
notice thereof. The Company will have the right to participate in or, by giving
written notice to the Trustee, to elect to assume the defense of any litigation
or proceeding at the Company's expense and by the Company's counsel (provided
such counsel is reasonably satisfactory to the Trustee), and the Trustee will
cooperate in good faith in such defense. If within ten calendar days after
giving notice of a Third Party Claim to the Company, the Trustee receives
written notice from the Company that the Company has elected to assume the
defense of the Third Party Claim, the Company will not be liable for any legal
expenses subsequently incurred by the Trustee in connection with the defense
thereof; provided, however, that if the Trustee is advised in writing by its
counsel that it needs separate counsel based on a conflict of interest, the
Trustee may assume its own defense, and the Company will be liable for all
reasonable legal fees, costs and expenses paid or incurred in connection
therewith in accordance with the terms of this Agreement. Without the prior
written consent of the Trustee which will not be unreasonably withheld or
delayed, the Company will not enter into any settlement of any Third Party Claim
which would lead to liability or create any financial or other obligation on the
part of the Trustee for which the Trustee is not entitled to indemnification
hereunder. Without the prior written consent of the Company which will not be
unreasonably withheld or delayed, the Trustee will not enter into any settlement
of any Third Party Claim which would create any financial or other liability on
the part of the Company or the Participant.
(c) Subject to Section 8(b) above, the Trustee may consult with legal
counsel (who may also, but need not, be counsel for Company) generally with
respect to any of its duties or obligations hereunder at Company's expense
which, should it remain unpaid, may be paid from the Trust without prior notice
to any party (but the Trustee shall give notice of such action within three (3)
business days thereof). The Trustee shall incur no liability to any person for
acting or refraining from acting in accordance with the advice of such counsel.
(d) The Trustee may hire agents, accountants, actuaries, investment
advisors, financial consultants or other professionals (other than legal
counsel, the Trustee's right to which is described in Section 8(b) and (c)
above) to assist it in performing any of its duties or obligations hereunder at
the Company's expense which, should it remain unpaid, may be paid from the Trust
without prior notice to any party (but the Trustee shall give notice of such
action within three (3) business days thereof). The Trustee shall incur no
liability to any person for acting or refraining from acting in accordance with
the advice of such agents, accountants, actuaries, investment advisors,
financial consultants or other professionals.
(e) 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, 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. The Trustee shall not be liable for the
failure or inability of an insurance company to pay the proceeds of any policy
when due, and in no event shall the Trustee have any responsibility or liability
with respect to the selection or monitoring of any insurance policies held in
the Trust or the insurers issuing such policies or the payment of premiums with
respect to such policies.
(f) The Company has represented to the Trustee that the Plan either (i) is
not subject to ERISA, or (ii) is a "top-hat" plan maintained primarily for the
purpose of providing deferred compensation for a select group of management or
highly compensated employees, which is exempt from the provisions of Part 4 of
Title I of ERISA. The Trustee is entering into this Agreement in reliance upon
the Company's representation. Accordingly, in the event that the Plan is subject
to ERISA and fails to qualify as a top-hat plan exempt from ERISA, then
notwithstanding any other provision of this Agreement to the contrary, the
Company will indemnify and hold the Trustee harmless from all liabilities,
damages, costs and expenses (including, without limitation, reasonable
attorneys' fees and expenses) that the Trustee incurs as a result of a breach of
fiduciary duty under ERISA arising from any action taken, or omitted to be
taken, by the Trustee in good faith in accordance with this Agreement. In such
event, the Company will, upon notice, pay monthly in arrears to or on behalf of
the Trustee, all reasonable attorneys' fees and expenses incurred by the
Trustee. In the event that the Trustee is determined to have incurred any
liability as a result of the Trustee's gross negligence or willful misconduct,
the Trustee will promptly reimburse the Company for all legal fees and expenses
paid by the Company to or on behalf of the Trustee.
(g) In the event that the Trustee is named in a lawsuit or proceeding
involving the Plan or the Trust Fund, the Trustee shall be entitled to receive
payments on a current basis pursuant to the indemnity provisions provided for in
this Section; provided, however, that if the final judgment entered in the
lawsuit or proceeding holds that Trustee is guilty of gross negligence or
willful misconduct with respect to the Trust Fund, the Trustee shall be required
to refund the indemnity payments that it has received.
(h) All releases and indemnities provided in this Trust Agreement shall
survive the termination of this Trust Agreement. The Company shall indemnify and
hold harmless the Trustees for any actions of a prior Trustee.
(i) Notwithstanding any powers granted to Trustee pursuant to this Trust
Agreement or to applicable law, 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.
(j) Upon the expiration of ninety (90) days from the date of any Trustee
account statement, the Trustee shall be forever released and discharged from all
liability and further accountability to the Company or any other person with
respect to the accuracy of such account statement and all acts and failures to
act of the Trustee reflected thereon, except to the extent that the Company,
within such 90-day period, shall file with the Trustee specific, written
objections to the account statement and, in any event, except to the extent that
such accuracy, acts and failures to act are not readily discernible from a
reasonable review of such account statement. To the extent not excepted pursuant
to the preceding sentence, neither the Company, the Participant nor any other
person shall be entitled to any additional or different accounting by the
Trustee, and the Trustee shall not be compelled by the Company to file in any
court any additional or different accounting. For purposes of regulations
promulgated by Federal banking authorities, the Trustee's account statements
shall be sufficient information concerning securities transactions effected for
the Trust, provided that so long as the Trustee is directed with respect to the
investment of the Trust, the Company or the investment manager, as the case may
be, shall have the right, upon written request, to receive at no additional cost
written confirmations of such securities transactions, which shall be mailed or
otherwise furnished by the Trustee within the timeframe required by applicable
regulations.
Section 9. Compensation and Expenses of Trustee.
(a) The Trustee shall be entitled to reasonable compensation for its
services as agreed upon between the Trustee and the Company and as set forth
from time to time in Schedule I attached hereto and incorporated herein by this
reference. If the Trustee and the Company fail to agree upon a compensation
agreement, the Trustee shall be entitled to compensation at a rate equal to the
rate charged by the Trustee for similar services rendered by it during the
current fiscal year for other trusts similar to this Trust. The Trustee's
compensation and expenses shall be paid by the Company. The Trustee is
authorized to withdraw such amounts from the Trust Fund if the Company fails to
pay them within sixty (60) days of presentation of a statement of the amounts
due and the Trustee shall notify the Company of any such action within three (3)
business days thereof.
(b) The Trustee is authorized to incur reasonable expenses in connection
with the administration of the Trust including but not limited to, fees and
expenses incurred pursuant to Section 8(c) and Section 8(d). Such expenses shall
be paid by the Company. The Trustee is authorized to pay such amounts from the
Trust Fund if the Company fails to pay them within sixty (60) days of
presentation of a statement of the amounts due and the Trustee shall notify the
Company of any such action within three (3) business days thereof.
Section 10. Resignation and Removal of Trustee.
(a) The Trustee may resign at any time by written notice to the Company,
which shall be effective 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 30 days written notice or
upon shorter written notice accepted by the Trustee.
(c) Upon resignation or removal of the Trustee and appointment of a
successor Trustee, all Trust Fund assets shall subsequently be transferred to
the successor Trustee. The transfer shall be completed within 45 days after
receipt of notice of successor trustee's acceptance of appointment or such
longer period as the Company may designate in writing.
(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 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. For purposes of this section, any successor Trustee may not be an
affiliate of the Company. An affiliate of the Company includes any person
directly or indirectly through on or more intermediaries controlling, controlled
by or under common control with the Company.
Section 11. Appointment of Successor.
(a) 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, that may be granted corporate trustee powers under federal or 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 upon transfer of same to the new trustee.
The former trustee shall execute any instrument necessary or reasonably
requested by the Company or the successor trustee to evidence the transfer.
(b) Any successor trustee appointed by a court pursuant to the second
sentence of Section 10(d) hereof shall be any third party, such as a bank trust
department, that may be granted corporate trustee powers under federal or state
law. The appointment of a successor trustee shall be effective when accepted in
writing by the new trustee. The new trustee shall have all the rights and powers
of the former trustee, including ownership rights in Trust assets upon transfer
of same to the new trustee. The former trustee shall execute any instrument
necessary or reasonably requested by the successor trustee to evidence the
transfer.
(c) 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 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) 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 Plan 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 Plan participants
and their beneficiaries are no longer entitled to benefits pursuant to the terms
of the Plan. Upon termination of the Trust, any assets remaining in the Trust
shall be returned to the Company. Such remaining assets shall be paid by the
Trustee to the Company in such amounts and in the manner instructed by the
Company, whereupon the Trustee shall be released and discharged from all
obligations hereunder. From and after the date of termination, and until final
distribution of the Trust Fund, the Trustee shall continue to have all of the
powers provided herein as are necessary or expedient for the orderly liquidation
and distribution of the Trust Fund.
Section 13. Legal Defense Fund; Claims Against the Trustee or the Trust.
(a) If so instructed, in writing, by the Company in its sole discretion,
the Trustee shall establish within the Trust Fund a separate fund, hereinafter
referred to as a "Legal Defense Fund." The Legal Defense Fund shall consist of
such portions of the Company's contributions to the Trust as the Company shall
specify in writing at the time of contribution, together with all income, gains
and losses and proceeds from the investment, reinvestment and sale thereof, less
all payments therefrom and expenses charged thereto in accordance with the
provisions of this Agreement. Subject to Section 3, the Legal Defense Fund shall
be held and administered by the Trustee for the purpose of defraying the costs
and expenses incurred by the Participant and his beneficiary(ies) associated
with the enforcement of their rights under the Plan by litigation or other legal
action and by the Trustee in performing its duties under this Section.
(b) The Legal Defense Fund, if any, shall be maintained and administered as
a separate segregated account; provided, however, that the assets of the Legal
Defense Fund may be commingled with all other assets of the Trust, and with the
assets of any other Trust, solely for investment purposes.
(c) If legal proceedings are brought against the Trustee by the Company or
another party seeking to invalidate any of the provisions of this Agreement or
the Trust, or seeking to enjoin the Trustee from paying any amounts from the
Trust or from taking any other action otherwise required or permitted to be
taken by the Trustee under this Agreement, the Trustee shall take all steps that
may be necessary in such proceeding to uphold the validity and enforceability of
the provisions of this Agreement. The Trustee shall be empowered to retain
counsel and other appropriate experts, including actuaries and accountants, to
assist it in making any determination under this Section 13. All costs and
expenses incurred by the Trustee in connection with any such proceeding
(including, without limitation, the payment of reasonable fees, costs and
disbursements of any counsel, actuaries, accountants or other experts retained
by the Trustee in connection with such proceeding) shall be charged to and paid
from the Legal Defense Fund, if any. To the extent the Trustee's legal fees and
expenses exceed the amount available in the Legal Defense Fund, if any, such
fees and expenses shall be paid by the Trustee from the assets of the Trust Fund
unless promptly paid by the Company.
(d) If the Participant or his beneficiary(ies) notifies the Trustee in
writing that the Company has refused to pay a claim asserted by the Participant
or his beneficiary(ies) under the Plan, the Participant or such beneficiary(ies)
("Claimant") may demand payment from the Legal Defense Fund, if any, with
respect to expenses incurred in connection with the initiation or defense of any
litigation or other legal action by or against the Company or any director,
officer, stockholder or other person affiliated with the Company. Such demand
shall be made in writing by delivering to the Trustee within 90 days following
the date the Claimant incurs such expenses (i) a certification signed by the
Claimant that the Company is in default in paying its obligations under the
Plan, and (ii) itemizing in reasonable detail in a form acceptable to the
Trustee the expenses payable by the Legal Defense Fund, if any.
(e) In the event that on the date a Claimant's expenses are to be paid from
the Legal Defense Fund other expenses have been claimed but not yet paid and the
aggregate amount of all claims exceeds the amount available in the Legal Defense
Fund, the Company shall be obligated to make an additional contribution to the
Legal Defense Fund. In the event the Company fails to make such additional
contribution, the Trustee shall promptly advise the Claimant and shall only pay
that portion of the amount of the claim to each Claimant determined by
multiplying such Claimant's expenses by a fraction the numerator of which is the
amount held in the Legal Defense Fund and the denominator or which is the
aggregate expenses claimed by all Claimants. This Section 13(e) shall apply only
on and following the time that the Company instructs the Trustee to establish
the Legal Defense Fund in accordance with Section 13(a).
(f) Notwithstanding any provision herein to the contrary, the Trustee shall
be required to act under this Section 13 (other than in respect of Section
13(c)) only to the extent there are sufficient amounts available in the Legal
Defense Fund to defray the costs and expenses the Trustee reasonably anticipates
will be incurred in connection with such action.
(g) The Legal Defense Fund, if any, shall continue to be held and
administered by the Trustee for the purposes described in Section 13 until such
time as all benefits to which the Participant and his beneficiary(ies) are
entitled under the Plan shall have been paid in full to the Participant or his
beneficiary(ies). Any balance then remaining in the Legal Defense Fund shall be
distributed to the Company.
Section 14. 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 the Participant and his beneficiary(ies) under this
Trust Agreement may not be anticipated, assigned (either at law or in equity),
alienated, pledged, encumbered or subjected to attachment, garnishment, levy,
execution or other legal or equitable process.
(c) This Trust Agreement shall be governed by and construed in accordance
with the laws of the State of New York, to the extent not preempted by ERISA.
(d) This Trust Agreement shall be binding on, and the powers granted to the
Company and the Trustee, respectively, shall be exercisable by the respective
successors and assigns of the Company and the Trustee. Any corporation that
succeeds to substantially all of the business of the Trustee by merger,
consolidation, purchase or otherwise shall upon succession and without
appointment or other action by the Company be and become successor Trustee
hereunder.
(e) Any communication to the Trustee, including any notice, direction,
designation, certification, order, instruction or objection shall be in writing
and signed by the person authorized under the Plan or the Trust Agreement to
govern same. The Trustee shall be fully protected and indemnified by the Company
in acting in accordance with such written communications. Any notice required or
permitted to be given hereunder shall be deemed given if written and hand
delivered, mailed, postage prepaid, certified mail, return receipt requested or
transmitted by facsimile to the Company or the Trustee at the following address
or such other address as a party may specify, provided that notices to the
Trustee shall be deemed effective only upon receipt:
(i) if to the Company:
Triarc Companies, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (000) 000-0000
Attention: General Counsel
(ii) If to the Trustee:
Wilmington Trust Company, as Trustee
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Facsimile No.: (000) 000-0000
Attention: Corporate Retirement and
Custody Services Division
(f) Any obligation of the Company and/or the Trust to pay the Trustee
amounts pursuant to any provision of this Trust Agreement shall survive any
amendment or termination hereof or the Trustee's resignation or removal.
IN WITNESS WHEREOF the Company and the Trustee have signed this
Trust Agreement as of the date first written above.
TRIARC COMPANIES, INC.
By: /s/ Xxxxx X. Xxxxxx
-------------------
Name: Xxxxx X. Xxxxxx
Title: Executive Vice President
WILMINGTON TRUST COMPANY
By: /s/ Xxxxxxxx X. Xxxxxxxxx
-------------------------
Name: Xxxxxxxx X. Xxxxxxxxx
Title: Vice President
Schedule I
Trustee's Fees
The Trustee's compensation shall be equal to 10 basis points (.0010) per annum
of the aggregate market value of the assets of the Trust, payable quarterly in
arrears with a minimum annual fee of $5,000.
This fee arrangement shall be in effect through January 1, 2004. Thereafter, the
Trustee may increase its annual compensation but such increase shall not exceed
the lesser of: (i) 15%; and (ii) 50% of the Trustee's posted fee schedule for
comparable accounts then in effect. Any such increase shall remain in effect
until January 1, 2006 and thereafter until another fee arrangement is agreed
upon by the Trustee and the Company.
Notwithstanding the foregoing, in the event of a material change in the
custodial services of the Trustee under the Trust Agreement or if the Trustee is
required to perform material services in addition to the Trustee's custodial
responsibilities and responsibilities pursuant to the investment directions
given to the Trustee by the Company or any investment manager appointed by the
Company pursuant to Section 2.2 of the Plan, the Trustee reserves the right to
receive additional reasonable compensation as agreed upon with the Company. In
the event the Trustee is engaged to provide investment management services
(other than cash management services as provided in Section 5 of the Trust
Agreement), the Trustee will be entitled to receive additional reasonable
compensation as agreed upon with the Company.
