1
EXHIBIT 4.5(a)
ATLANTIC RICHFIELD
CAPITAL ACCUMULATION PLAN II
TRUST AGREEMENT
-----------------
THIS AGREEMENT made this 14th day of June, 1988 between ATLANTIC
RICHFIELD COMPANY a Delaware corporation ("ARCO") and STATE STREET BANK AND
TRUST COMPANY, a banking corporation having its principal place of business at
000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 ("Trustee");
R E C I T A L S
A. This instrument creates a trust for purposes of the Atlantic
Richfield Capital Accumulation Plan II (the "Plan").
B. Effective July 1, 1988 the assets and liabilities of the Atlantic
Richfield Capital Accumulation Plan allocable as of June 30, 1988 to the
participants in the Plan are to be transferred to this trust.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
Creation of the Trust
1. There is hereby established with Trustee a trust consisting of all
sums paid to Trustee for purposes of the Plan (including all trust assets paid
over to Trustee by the trustee of the Atlantic Richfield Capital Accumulation
Plan), investments thereof and earnings and appreciations
- 1 -
2
thereon, which, less disbursements made by Trustee, are referred to herein as
the "Fund" and shall be dealt with as herein provided. Trustee shall have no
duty or authority to inquire into the correctness of amounts tendered to it or
to enforce the collection of any contribution by ARCO or the members of the Plan
("Members").
Investment and Administration of the Fund
2. Trustee shall have the power to hold and invest the principal and
income of the Fund in the following manner:
(A) Common Stock of Atlantic Richfield Company purchased on the open
market or from ARCO as may be directed by ARCO in accordance with the Plan;
(B) In cash, such as deposits in interest bearing bank accounts,
certificates of deposit, corporate or governmental obligations maturing in not
more than five (5) years, financial futures contracts, deposits under a deposit
administration or similar insurance contract or in a commingled or common
investment account or fund established and maintained by a bank (which bank may
be Trustee), including any fixed income commingled funds maintained by Trustee
for qualified employee benefit accounts and the assets of which are invested
primarily in debt obligations, in similar cash accounts managed by investment
managers appointed by ARCO, or any combination of the foregoing investment media
as ARCO determines;
(C) In units of a fund, consisting of specified equity investments
such as common or capital stock of issuers other than the ARCO, bonds,
debentures or preferred stocks convertible into common or capital stock of such
issuers, financial futures contracts, interests in any
- 2 -
3
commingled or common equity fund established and maintained by an investment
advisor or a bank (which bank may be a Trustee for the Plan), interests in any
mutual fund or other similar types of equity investments and cash equivalent
short-term investments maturing in less than one year, or in any combination
thereof as ARCO may determine.
(D) The Declaration of Trust creating a commingled or common fund
with respect to which the Trust participates is deemed to be part of this Trust
Agreement to the same extent as if fully set forth at length.
3. The Atlantic Richfield Capital Accumulation Plan Administrative
Committee ("Committee") shall furnish in writing to Trustee information
sufficient to enable Trustee to allocate each contribution received by Trustee
among the above several classes of investments in conformity with the provisions
of the Plan and the investment options elected by the Members.
4. This Paragraph is intended to authorize appointment of an investment
manager as contemplated in Section 402(c)(3) of the Employee Retirement Income
Security Act of 1974 ("ERISA").
ARCO may appoint an investment manager with respect to some or all
of the assets of the Fund. The appointment of the investment manager shall be
made by an officer of ARCO or other named fiduciary authorized by a resolution
of ARCO's Board of Directors to make such appointments. The authority of the
investment manager shall not begin until Trustee receives from ARCO notice
satisfactory to Trustee that the investment manager has been appointed and that
the investment manager has acknowledged in writing that with
- 3 -
4
respect to the relevant assets of the Fund he or she or it is a fiduciary with
respect to the Plan within the meaning of ERISA. The investment manager's
authority shall continue until Trustee receives similar notice that the
appointment has been rescinded. By notifying Trustee of the appointment of an
investment manager, ARCO shall be deemed to warrant that such investment manager
meets the requirements of Section 3(38) of ERISA, but Trustee may demand
independent evidence that any investment manager meets those requirements.
The assets with respect to which a particular investment manager has
been appointed shall be segregated from all other assets held by Trustee under
this Agreement and the investment manager shall have the duty and power to
direct Trustee in every aspect of their investment. Upon request, Trustee shall
execute appropriate powers of attorney authorizing an investment manager
appointed hereunder to exercise the powers and duties of the investment manager.
Trustee may rely upon any order, certificate, notice, direction or
other documentary confirmation purporting to have been issued or given by an
investment manager which Trustee believes to be genuine and to have been issued
or given by such investment manager.
Any oral direction shall be followed by a written confirmation as soon
as practical. Trustee shall follow the procedures established by ARCO to
validate such oral directions.
5. ARCO may direct that with respect to some or all of the assets of
the Fund, Trustee shall be subject to the
- 4 -
5
direction of a fiduciary named by ARCO in a manner prescribed by its Board of
Directors. In such a case, Trustee shall be subject to proper direction of such
fiduciary, and ARCO shall be deemed to warrant that all directions given by such
fiduciary are proper, and made in accordance with the Plan, and are not contrary
to the provisions of Title I of ERISA. When so appointed, such a fiduciary shall
have the same powers as an investment manager appointed pursuant to Paragraph 4.
The assets with respect to which a particular fiduciary has been
appointed shall be segregated from all other assets held by Trustee under this
Agreement and the fiduciary shall have the duty and power to direct Trustee in
every aspect of their investment. Upon request, Trustee shall execute
appropriate powers of attorney authorizing a fiduciary appointed hereunder to
exercise the powers and duties of the investment fiduciary.
Trustee may rely upon any order, certificate, notice, direction or
other confirmation, whether written or oral, purporting to have been issued or
given by a fiduciary which Trustee believes to be genuine and to have been
issued or given by such investment fiduciary.
Any oral direction shall be followed by a written confirmation as soon
as practical. Trustee shall follow the procedures established by ARCO to
validate such instructions.
6. When acting hereunder, whether in its discretion or at the direction
of an investment manager or fiduciary named pursuant to Paragraph 4 or 5,
Trustee shall have the powers granted Trustees by law and in addition shall have
the power:
- 5 -
6
(A) To vote any bonds or other securities of any corporation or other
issuer at any time held in the trust provided that the shares of ARCO Common
Stock in a Member's account shall be voted by the Trustee in accordance with the
Member's instructions unless such instructions are not given within a reasonable
period of time established by the Trustee; to otherwise consent to or request
any action on the part of any such corporation or other issuer; to give general
or special proxies or powers of attorney with or without power of substitution;
to participate in any reorganization, recapitalization, merger or similar
transaction with respect to such securities and to deposit such securities in
any voting trust, pooling agreement or with any protective or like committee, or
with a trustee, or with depositories designated thereby; to generally exercise
any of the powers of an owner with respect to the securities or properties
comprising the trust; to institute, compromise and defend actions and
proceedings; to pay or contest any claim; to settle a claim by or against the
trust by compromise, arbitration or otherwise; to release, in whole or in part,
any claim belonging to the trust to the extent that the claim is uncollectible;
provided that;
(i) Each Member shall be entitled to direct the Trustee as to the
manner in which whole shares of ARCO Common Stock credited to the Member's
account shall be voted. Fractional shares of ARCO Common Stock shall be
aggregated into whole shares of stock and voted by the Trustee in the same
proportion as the aggregate shares which are voted by the Trustee pursuant to
Members' written instructions. In the absence of voting instructions by one or
more Members, the Trustee shall vote such shares in the aggregate in the same
proportion as the aggregate shares which are voted by the Trustee pursuant to
Members' written
- 6 -
7
instructions. With respect to unallocated shares of ARCO Common Stock held in a
loan suspense account, the Trustee shall vote such shares in the aggregate in
the same proportion as the aggregate shares, allocated to Members' accounts, are
voted by the Trustee pursuant to Members' written instructions.
(ii) Each Member shall be entitled to direct the Trustee as to the
manner in which rights other than voting rights attributable to whole shares of
ARCO Common Stock credited to the Member's account shall be exercised. Rights
attributable to fractional shares of ARCO Common Stock shall be aggregated into
whole shares of stock and exercised by the Trustee in the same proportion as
rights which are exercised by the Trustee pursuant to Members' written
instructions. In the absence of instructions by one or more Members, the Trustee
shall exercise such rights in the aggregate in the same proportion as the
aggregate rights which are exercised by the Trustee pursuant to Members' written
instructions. With respect to unallocated shares of ARCO Common Stock held in a
loan suspense account, the Trustee shall exercise such rights in the aggregate
in the same proportion as the aggregate shares, allocated to Members' accounts,
are exercised by the Trustee pursuant to members' written instructions.
(B) To hold property of the Fund in its own name or in the name of a
nominee or nominees, without disclosure of the trust, or in bearer form so that
it will pass by delivery; but no such holding shall relieve Trustee of its
responsibility for the safe custody and disposition of the Fund in accordance
with the provisions of this Agreement; Trustee's books and records shall at all
times show that such property is part of the Fund; and Trustee shall be liable
for any loss occasioned by the acts of its nominee or
- 7 -
8
nominees with respect to securities registered in the name of the nominee or
nominees as much as if such acts were the acts of Trustee;
(C) To employ agents in the management of the Fund, provided that
Trustee shall be responsible for the acts of such agents (other than acts of the
United States Postal Service) as much as if they were acts of Trustee;
(D) To make, execute and deliver, as Trustee, any conveyances,
contracts, waivers, or other instruments in writing that Trustee may deem
necessary or desirable in the exercise of its powers under this Agreement;
(E) To apply for, purchase, hold and transfer any annuity contract for
a participant in accordance with written instructions from ARCO in conjunction
with the termination of the Plan, provided that no such contract shall provide
for a life annuity; and
(F) To do all other acts that Trustee may deem necessary or proper to
carry out any of the powers set forth in this Agreement or otherwise in the best
interests of the Fund.
(G) As directed by ARCO, to borrow from any lender (including ARCO or
the Trustee) to finance the acquisition of ARCO Common Stock, and to make
payments on such loans, giving its note as Trustee with such reasonable interest
and security for the loan as may be appropriate or necessary; provided that any
such borrowing shall comply with the provisions of the Plan.
7. Trustee may hold uninvested or may invest in its discretion in
short-term cash equivalents (including
- 8 -
9
deposits, savings accounts and certificates of deposit with its own banking
department or any common or collective trust fund maintained by Trustee which
satisfies such objective): (i) any amount stated by ARCO or believed by Trustee
to be needed in the near future for withdrawals from the Fund, or (ii) all or a
portion of the proceeds of a loan described in Section 6(G) pending the
acquisition of ARCO Common Stock.
8. Trustee, as and when directed by ARCO (or any committee or person or
entity designated for such purpose in the Plan or otherwise by ARCO), shall make
distributions or pay withdrawals, pay expenses of administering the Plan, buy,
sell or turn in for redemption securities, and exercise or sell options, rights
or warrants as shall be specified in any such direction. In the case of any such
distribution or withdrawal, Trustee shall make or pay the same in cash or in
kind, or in any combination thereof as provided in the direction. ARCO shall
hold harmless and shall defend Trustee against any liability arising or asserted
to arise out of Trustee's compliance with directions under this paragraph.
9. Trustee shall be paid such reasonable compensation for its service
as Trustee as shall from time to time be agreed upon by ARCO and Trustee. Unless
paid by ARCO, such compensation, and the expenses of administration of this
Trust, may be withdrawn by Trustee from the Fund.
10. Trustee shall pay out of the Fund all taxes imposed or levied with
respect to the Fund or any part thereof, under existing or future laws, and at
ARCO's direction, may contest the validity or amount of any tax assessment,
claim or demand respecting the Fund or any part thereof.
- 9 -
10
11. The following additional rules shall govern the standard of conduct
and liabilities of Trustee hereunder;
(A) Trustee shall perform all of its functions hereunder with the
care, skill, prudence, and diligence under the circumstances then prevailing
that a prudent man 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, or in accordance with such other standard as may be required from time to
time by law, and shall not be liable for any conduct on its part (including
reliance on advice of counsel) which conforms to that standard.
(B) Trustee shall hold ARCO, its subsidiaries and affiliates and
each of the directors, officers or employees of ARCO and of any such affiliate
or subsidiary harmless (including the cost of outside counsel) against any
liability or excise tax asserted against ARCO or any such entity or person as a
result of any breach by Trustee of any of its duties or fiduciary
responsibilities. This Clause (B) shall not require Trustee to hold ARCO or any
other entity or person harmless against any liability or excise tax arising out
of action or inaction of Trustee pursuant to or pending direction by an
investment manager or fiduciary named pursuant to Paragraph 4 or 5 or by ARCO
pursuant to any provision of this Agreement.
(C) Trustee shall not be liable for the acts or omissions of an
investment manager or fiduciary appointed under Paragraph 4 or 5, and, except
with respect to short-term investments under Paragraph 7, Trustee shall be under
no obligation to invest or otherwise manage any asset of the Plan which is
subject to the management of such investment manager or fiduciary, it being the
intention of
- 10 -
11
the parties that, except with respect to investments under Paragraph 7, Trustee
shall have the full protection of Section 405 of ERISA.
(D) Where an investment manager or fiduciary has been named pursuant
to Paragraph 4 or 5 or where ARCO is required to give directions to Trustee,
ARCO shall hold harmless and defend Trustee against any liability or excise tax
arising out of Trustee's action or inaction pursuant to or pending direction by
such investment manager, fiduciary or ARCO. This Clause (D) shall not apply to
any liability arising out of any act or omission in which Trustee knowingly
participates or which Trustee knowingly undertakes to conceal, knowing such act
or omission to be a breach of fiduciary responsibility.
(E) When so instructed by ARCO, Trustee shall deposit any assets
held by it with a custodian named by ARCO, and ARCO shall hold harmless and
defend Trustee against any liability arising or asserted to arise out of
Trustee's compliance with directions under this paragraph.
Accounting by Trustee
12. Trustee shall keep accurate and detailed accounts of all
investments, receipts, disbursements, withdrawals and other transactions
hereunder, and all records relating thereto shall be open to inspection and
audit at all reasonable times by any person or corporation designated by ARCO.
At such intervals as ARCO may from time to time designate, and as of the date of
the removal or resignation of Trustee, Trustee shall file with ARCO a written
account setting forth all investments, receipts, disbursements, withdrawals and
other transactions effected by it during the period from the date of its last
such account and a list of the assets of the Fund at the close of such period.
Such
- 11 -
12
account may be in the form of monthly or quarterly statements which taken
together reflect the matters set forth in the preceding sentence. As between
ARCO and Trustee, Trustee shall be forever released and discharged from all
liability with respect to the propriety of acts and transactions shown in such
account, except with respect to any such act or transaction as to which ARCO
shall within 90 days following notification thereof have filed written
objections with Trustee and except that no such accounting shall foreclose any
liability of Trustee to ARCO arising under Paragraph 11(B). Except as provided
in Paragraph 11(B), the liability of Trustee to persons other than ARCO shall be
limited to actions under ERISA brought within the period permitted by law for
the bringing of such actions.
Removal and Resignation of Trustee
13. Trustee may be removed by ARCO at any time upon not less than 30
days' written notice and Trustee may resign at any time upon not less than 90
days' written notice. In either case, such notice may be wholly or partially
waived by the party to whom it is due. Upon Trustee's removal or resignation,
ARCO shall appoint a successor trustee who shall have the same powers and duties
as those conferred upon Trustee hereunder, and upon acceptance of such
appointment by the successor trustee, Trustee shall assign, transfer and pay
over to such successor trustee the funds and properties then constituting the
Fund. If ARCO fails within a reasonable time to name a successor trustee or
otherwise direct proper disbursement of the Fund, Trustee may apply to any court
of competent jurisdiction for appropriate relief. Trustee may in any event
reserve such reasonable sum of money as it may deem advisable, to provide for
any charges against the Fund for which it may be liable, and for payment of its
fees and expenses in connection with the settlement of its account or otherwise.
Any balance of
- 12 -
13
such reserve remaining after the payment of such fees and expenses shall be paid
over as aforesaid.
14. If the Plan is wholly or partially terminated, Trustee shall
disburse the portion of the Fund affected by the termination as directed by
ARCO. Trustee may elect to treat any such disbursement as a removal of Trustee
with respect to the assets disbursed, in which case the provisions of Paragraph
13 shall apply.
15. ARCO may amend this Agreement by an instrument in writing signed by
an authorized officer of ARCO or by any other named fiduciary authorized by a
resolution of ARCO's Board of Directors to sign such amendment, provided that no
such amendment shall divert any part of the Fund to purposes other than payment
of benefits to Plan members and their beneficiaries or defrayal of reasonable
expenses of administering the Plan, and, except with Trustee's consent, no
amendment affecting the duties, responsibilities or rights of Trustee shall take
effect until 30 days after a copy of said amendment is furnished to Trustee or,
if Trustee gives notice of resignation within such 30-day period, until the
resignation becomes effective.
16. ARCO may terminate this Agreement by directing disbursement of the
entire Fund pursuant to Paragraph 13.
Miscellaneous
17. Prior to satisfaction of all liabilities under the Plan, no part of
the Fund shall inure to the benefit of ARCO or be used other than for purposes
of providing benefits to Members and their beneficiaries and defraying
reasonable expenses of administering the Plan. However;
- 13 -
14
(A) If a contribution under the Plan is made by a mistake of fact, this
paragraph shall not prohibit the return of an amount not in excess of such
contribution at the direction of ARCO within one year after the contribution is
paid;
(B) If a contribution under the Plan is expressly conditioned on
initial qualification of the Plan under Section 401 of the Internal Revenue Code
of 1986, as amended, and if the Plan does not qualify, or continue to so
qualify, this paragraph shall not prohibit the return of an amount not in excess
of such contribution at the direction of ARCO within one year after the date of
denial of qualification of the Plan; and
(C) If a contribution under the Plan is expressly conditioned upon the
deductibility of the contribution under Section 404 of the Internal Revenue Code
of 1986, as amended, then, to the extent the deduction is disallowed, this
paragraph shall not prohibit the return of an amount not in excess of such
contribution (to the extent disallowed) at the direction of ARCO within one year
after the disallowance of the deduction.
Trustee may demand assurance satisfactory to it that the sum of all
amounts being returned from the Trust under the Plan does not exceed the amount
described above.
18. This Trust is intended to be entitled to an income tax exemption
under Section 501(a) of the Internal Revenue Code of 1986 and wherever possible
shall be construed to carry out that intention. Trustee may demand assurances
satisfactory to it that any action it is directed to take will not adversely
affect the tax exemption of the Trust.
- 14 -
15
19. Any successor in interest to Trustee shall automatically become
Trustee hereunder.
20. Any successor to all or part of the business of ARCO may become a
party to this Agreement and, with respect to assets of the Fund which ARCO
warrants to Trustee are allocable to such successor, this Agreement shall be
deemed to create a separate trust composed of such assets and administered
according to this Agreement, except that such successor shall be substituted for
ARCO for all purposes hereunder.
21. Unless otherwise provided in this Agreement, any communications
(including notices, instructions, or directions) required or permitted hereunder
to be given by ARCO shall be given in writing addressed to the trust officer
with whom ARCO customarily deals and signed by the officer delegated such power,
or any other person or persons whom ARCO notifies Trustee are from time to time
authorized to sign such communications. ARCO shall furnish Trustee specimen
signatures of all persons authorized to sign communications to Trustee.
22. If any payment mailed by regular U.S. Mail to the last address of
the payee furnished by ARCO is returned unclaimed, Trustee shall so notify ARCO
and shall discontinue further payments to such payee until it receives further
instructions of ARCO.
23. No amount held hereunder shall be subject to voluntary or
involuntary alientation or to the claims of any creditor.
24. This Agreement shall be controlled by the law of the State of
Massachusetts in all respects in which that law is not inconsistent with ERISA.
- 15 -
16
25. This Agreement may be executed in counterparts, each of which shall
be an original although the others are not produced.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed the date first written above.
ATTEST: ATLANTIC RICHFIELD COMPANY
By: /s/ XXXXXXX X. XXXXX By /s/ E. XXXX XXXXX, XX.
--------------------------- ----------------------------------
Assistant Secretary E. Xxxx Xxxxx, Xx.
As named fiduciary appointed by the Board of
Directors of Atlantic Richfield Company with
power and Authority to negotiate, execute
and deliver this Trust Agreement on behalf
of Atlantic Richfield Company
ATTEST: STATE STREET BANK AND TRUST COMPANY
as Trustee
By: /s/ XXXXXX X. XXXXXXXX By /s/ XXXX X. XXXXXXXX
--------------------------- ----------------------------------
ARCO hereby appoints the following fiduciaries pursuant to Paragraph 5.
E. Xxxx Xxxxx, Xx. Assets
and/or Xxxxxx X. Xxxxxxx
Jointly or Individually All Trust Assets
By: /s/ E. XXXX XXXXX, XX.
----------------------------------
E. Xxxx Xxxxx, Xx.
- 16 -
