Exhibit 4-e
ROCKWELL INTERNATIONAL CORPORATION
DEFERRED COMPENSATION PLAN
TRUST AGREEMENT
This Agreement made this ____ day of ________________, 2000 and between
Rockwell International Corporation ("Company") and Xxxxx Fargo Bank, N.A.
("Trustee");
(a) WHEREAS, Company has adopted the Rockwell International Corporation
Deferred Compensation Plan;
(b) WHEREAS, Company has incurred or expects to incur liability under
the terms of such Plan with respect to the individuals participating in such
Plan;
(c) WHEREAS, Company wishes to establish a trust (hereinafter called
"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 Plan participants and their
beneficiaries in such manner and at such times as specified in the Plan;
(d) WHEREAS, it is the intention of the parties that this Trust shall
constitute an unfunded arrangement and shall not affect the status of the Plan
as an unfunded plan maintained for the purpose of providing deferred
compensation for a select group of management or highly compensated employees
for purposes of Title I of the Employee Retirement Income Security Act of 1974;
(e) WHEREAS, it is the intention of Company to make contribution to the
Trust to provide itself 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 an amount to be
mutually agreed upon, which shall become the principal of the Trust to be held,
administered and disposed of by 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 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, 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 Company and shall be used exclusively for
the uses and purposes of Plan participants and general creditors as herein set
forth. Plan participants and their beneficiaries shall have no preferred claim
on, or any beneficial ownership interest in, any assets of the Trust. Any rights
created under the Plan and this Trust Agreement shall be mere unsecured
contractual rights of Plan participants and their beneficiaries against Company.
Any assets held by the Trust will be subject to the claims of Company's general
creditors under federal and state law in the event of Insolvency, 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, acceptable to the
Trustee, in trust with Trustee to augment the principal to be held, administered
and disposed of by Trustee as provided in this Trust Agreement. Neither Trustee
nor any Plan participant or beneficiary shall have any right to compel such
additional deposits.
(f) Upon a Change of Control, Company shall, as soon as possible, but
in no event longer than thirty (30) days following the Change of Control, as
defined herein, make an irrevocable contribution to the Trust in an amount that
is sufficient to pay each Plan participant or beneficiary the benefits to which
Plan participants or their beneficiaries would be entitled pursuant to the terms
of the Plan as of the date on which the Change of Control occurred.
Section 2. Payments to Plan Participants and Their Beneficiaries.
(a) Company shall deliver to Trustee a schedule (the "Payment
Schedule") that indicates the amounts payable in respect of each Plan
participant (and his or her beneficiaries), 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 or available under the
Plan), and the time of commencement for payment of such amounts. Except as
otherwise provided herein, Trustee shall make payments to the Plan participants
and their beneficiaries in accordance with such Payment Schedule. The Trustee
shall make provision for the reporting and withholding of any federal, state or
local taxes that may be required to be withheld with respect to the payment of
benefits pursuant to the terms of the Plan and shall pay amounts withheld to the
appropriate taxing authorities or determine that such amounts have been
reported, withheld and paid by Company.
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(b) The entitlement of a Plan participant or his or her beneficiaries
to benefits under the Plan shall be determined by 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.
(c) Company may make payment of benefits directly to Plan participants
or their beneficiaries as they become due under the terms of the Plan. Company
shall notify 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, Company shall make the balance of each such payment as it falls due.
Trustee shall notify Company where principal and earnings are not sufficient.
Section 3. Trustee Responsibility Regarding Payments to Trust
Beneficiary When Company Is Insolvent.
(a) Trustee shall cease payment of benefits to Plan participants and
their beneficiaries if the Company is Insolvent. Company shall be considered
"Insolvent" for purposes of this Trust Agreement if (i) Company is unable to pay
its debts as they become due, or (ii) 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 Company under federal and state law as set forth
below.
(i) The Board of Directors and the Chief Executive Officer of
Company shall have the duty to inform Trustee in writing of Company's
Insolvency. If a person claiming to be a creditor of Company alleges in
writing to Trustee that Company has become Insolvent, Trustee shall
determine whether Company is Insolvent and, pending such determination,
Trustee shall discontinue payment of benefits to Plan participants or their
beneficiaries.
(ii) Unless Trustee has actual knowledge of Company's Insolvency,
or has received notice from Company or a person claiming to be a creditor
alleging that Company is Insolvent, Trustee shall have no duty to inquire
whether Company is Insolvent. Trustee may in all events rely on such
evidence concerning Company's solvency as may be furnished to Trustee and
that provides Trustee with a reasonable basis for making a determination
concerning Company's solvency.
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(iii) If at any time Trustee has determined that Company is
Insolvent, Trustee shall discontinue payments to Plan participants or their
beneficiaries and shall hold the assets of the Trust for the benefit of
Company's general creditors. Nothing in this Trust Agreement shall in any
way diminish any rights of Plan participants or their beneficiaries to
pursue their rights as general creditors of Company with respect to benefits
due under the Plan or otherwise.
(iv) Trustee shall resume the payment of benefits to Plan
participants or their beneficiaries in accordance with Section 2 of this
Trust Agreement only after Trustee has determined that Company is not
Insolvent (or is no longer Insolvent).
(c) Provided that there are sufficient assets, if Trustee discontinues
the payment of benefits from the Trust pursuant to Section 3(b) hereof and
subsequently resumes such payments, the first payment following such
discontinuance shall include the aggregate amount of all payments due to Plan
participants or their beneficiaries under the terms of the Plan for the period
of such discontinuance, less the aggregate amount of any payments made to Plan
participants or their beneficiaries by 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 the Trust has become irrevocable, Company shall have no right or power to
direct Trustee to return to Company or divert to others any of the Trust assets
before all payments of benefits have been made to Plan participants and their
beneficiaries pursuant to the terms of the Plan.
Section 5. Investment Authority. In the administration of the Trust,
the Trustee shall have the following powers, all of which shall be exercised
only in a fiduciary capacity:
(a) To hold and control the assets in the Trust;
(b) To sell, exchange, assign, transfer, and convey any security or
property held in the Trust, at public or private sale, at such time and price
and upon such terms and conditions (including credit) as directed by the
Investment Manager;
(c) To invest and reinvest assets of the Trust (including accumulated
income) as directed by the Investment Manager;
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(d) To notify the Company with respect to any vote on any stock or
securities held in the Trust, as all voting rights with respect to Trust assets
will be exercised by Company;
(e) To consent to and participate in any plan for the liquidation,
reorganization, consolidation, or merger of any corporation, any security of
which is held in the Trust;
(f) To sell or exercise any "rights" issued on any securities held in
the Trust;
(g) To cause all or any part of the assets of the Trust to be held in
the name of the Trustee (which in such instance need not disclose its fiduciary
capacity) or, as permitted by law, in the name of any nominee, and to acquire
for the Trust any investment in bearer form, but the books and records of the
Trust shall at all times show that all such investments are part of the Trust
and the Trustee shall hold evidence of title to all such investments;
(h) To make such distributions to Participants (as such term is defined
in the Plan) in accordance with the provisions of this Trust Agreement; and
(i) From time to time the Company may appoint one or more investment
managers who shall have investment management and control over all or a portion
of the assets of the Trust ("Investment Managers"). The Company shall notify the
Trustee of the appointment of the Investment Manager. In the event more than one
Investment Manager is appointed, the Company shall determine which assets shall
be subject to management and control by each Investment Manager and shall also
determine the proportion in which funds withdrawn or disbursed shall be charged
against the assets subject to each Investment Manager's management and control.
As shall be provided in any contract between an Investment Manager and the
Company, such Investment Manager shall hold a revocable proxy with respect to
all securities which are held under the management of such Investment Manager
pursuant to such contract and such Investment Manager shall report the voting of
all securities subject to such proxy on an annual basis to the Company. In the
event that the Company does not appoint an Investment Manager as provided in
this Section 5(i), references in this Trust Agreement to "Investment Manager"
shall mean the Company.
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.
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Section 7. Accounting by Trustee. 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 Company and Trustee. Within sixty (60) days
following the close of each calendar year and within sixty (60) days after the
removal or resignation of Trustee, Trustee shall deliver to 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) 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
Trustee shall incur no liability to any person for any action taken pursuant to
a direction, request or approval given by Company which is contemplated by, and
in conformity with, the terms of the Plan or this Trust and is given in writing
by Company. In the event of a dispute between Company and a party, Trustee may
apply to a court of competent jurisdiction to resolve the dispute.
(b) If Trustee undertakes or defends any litigation arising in
connection with this Trust, Company agrees to indemnify Trustee against
Trustee's costs, expenses and liabilities (including, without limitation,
attorneys' fees and expenses) relating thereto and to be primarily liable for
such payments. If Company does not pay such costs, expenses and liabilities in a
reasonably timely manner, Trustee may obtain payment from the Trust.
(c) Trustee may consult with legal counsel (who may also be counsel for
Company generally) with respect to any of its duties or obligations hereunder.
(d) 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) Trustee shall have, without exclusion, all powers conferred on
Trustees by applicable law, unless expressly provided otherwise herein,
provided,
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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.
(f) 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.
Section 9. Compensation and Expenses of Trustee. Company shall pay all
administrative and Trustee's fees and expenses. If not so paid, the fees and
expenses shall be paid from the Trust.
Section 10. Resignation and Removal of Trustee.
(a) Trustee may resign at any time by written notice to Company, which
shall be effective thirty (30) days after receipt of such notice unless Company
and Trustee agree otherwise.
(b) Trustee may be removed by Company on thirty (30) days notice or
upon shorter notice accepted by Trustee.
(c) Upon a Change of Control, as defined herein, Trustee may not be
removed by Company for one (1) year.
(d) If Trustee resigns within one (1) year after a Change of Control,
as defined herein, Company shall apply to a court of competent jurisdiction for
the appointment of a successor Trustee or for instructions.
(e) If Trustee resigns or is removed within one (1) year of a Change of
Control, as defined herein, Trustee shall select a successor Trustee in
accordance with the provisions of Section 11(b) hereof prior to the effective
date of Trustee's resignation or removal.
(f) Upon resignation or removal of Trustee and appointment of a
successor Trustee, all assets shall subsequently be transferred to the successor
Trustee. The transfer shall be completed within sixty (60) days after receipt of
notice of resignation, removal or transfer, unless Company extends the time
limit.
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(g) If 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, Trustee may apply to a court of competent jurisdiction for
appointment of a successor or for instructions. All expenses of Trustee in
connection with the proceeding shall be allowed as administrative expenses of
the Trust.
Section 11. Appointment of Successor.
(a) If Trustee resigns or is removed in accordance with Section 10(a)
or (b) hereof, 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 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 Company or the successor Trustee
to evidence the transfer.
(b) If Trustee resigns or is removed pursuant to the provisions of
Section 10(e) hereof and selects a successor Trustee, Trustee may appoint any
third party such as a bank trust department or other party that may be granted
corporate trustee powers under 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. 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
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 Trustee and 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.
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(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 Company.
(c) Upon written approval of participants or beneficiaries entitled to
payment of benefits pursuant to the terms of the Plan, Company may terminate
this Trust prior to the time all benefit payments under the Plan have been made.
All assets in the Trust at termination shall be returned to Company.
(d) This Trust Agreement may not be amended by Company for two (2)
years following a Change of Control, as defined herein.
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 Plan participants and their beneficiaries 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 State of California.
(d) For purposes of this Trust, Change of Control shall mean any of the
following:
(1) The acquisition by any individual, entity or group (within the
meaning of section 13(d)(3) or section 14(d)(2) of the Exchange
Act) (a "Person") of beneficial ownership (within the meaning of
Ru le 13d-3 promulgated under the Exchange Act) of twenty
percent (20%) or more of either
(a) the then outstanding shares of 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 (a), the following acquisitions shall not
constitute a Change of Control:
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(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 paragraphs (1), (2) and (3) of subsection (c) of this
Section; or
(2) Individuals who, as of September 2, 1998, constituted the Board
of Directors (the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board; provided, however,
that any individual becoming a director subsequent to that date
whose election, or nomination for election by the Company's
shareowners, 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 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 "Company Transaction"), in each case, unless,
following such Company Transaction:
(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 Company Transaction beneficially
own, directly or indirectly, more than sixty percent (60%) 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 Company Transaction (including, without limitation,
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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 Company Transaction 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 sponsored by the Company or by such corporation
resulting from such Company Transaction) beneficially owns,
directly or indirectly, twenty percent (20%) or more of,
respectively, the then outstanding shares of common stock of
the corporation resulting from such Company Transaction 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 Company Transaction, and
(c) at least a majority of the members of the board of directors
of the corporation resulting from such Company Transaction
were members of the Incumbent Board at the time of the
execution of the initial agreement, or of the action of the
Board of Directors providing for such Company Transaction; or
(4) Approval by the Company's shareowners of a complete liquidation
or dissolution of the Company.
Section 14. Effective Date.
The effective date of this Trust Agreement shall be ___________ , 2000.
Rockwell International Corporation Xxxxx Fargo Bank, N.A.,
Trustee
By:________________________ By:______________________________
Its:_______________________ Its:_____________________________
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