TRUST AGREEMENT Between PPL CORPORATION And WACHOVIA BANK, N.A. AS TRUSTEE
Exhibit
10(e)
Between
PPL
CORPORATION
And
WACHOVIA
BANK, N.A. AS TRUSTEE
PPL
REVOCABLE DIRECTOR NON-QUALIFIED PLANS TRUST
TABLE
OF CONTENTS
ARTICLE
|
I
|
Establishment,
Purpose and Nature of Trust Fund
|
|
|
II
|
Contributions
to Trust Fund and Allocation to Plan Accounts
|
|
|
III
|
Cessation
of Payments from Trust Fund While Company Insolvent
|
|
|
IV
|
Payments
from Trust Fund While Company Solvent
|
|
|
V
|
Responsibilities
of the Trustee
|
|
|
VI
|
Fees,
Expenses and Taxes
|
|
|
VII
|
Accounts
of the Trustee
|
|
|
VIII
|
Resignation
or Removal of the Trustee
|
|
|
IX
|
Action
of PPL
|
|
|
X
|
Reservation
of Powers
|
|
|
XI
|
Surplus
Plan Accounts and Termination of Trust
|
|
|
XII
|
Merger
or Consolidation of the Trustee
|
|
|
XIII
|
Miscellaneous
|
Between
PPL
CORPORATION
And
WACHOVIA
BANK, N.A., AS TRUSTEE
This
Agreement and Declaration of Trust (hereinafter called the "Trust Agreement")
made as of the 1st day of January, 2007, by and between PPL Corporation, a
corporation organized and existing under the laws of the Commonwealth of
Pennsylvania, with its principal place of business at Allentown, Pennsylvania,
hereinafter referred to as “PPL" or the "Company,” and Wachovia Bank, N.A., with
its principal place of business at Charlotte, North Carolina, hereinafter called
the "Trustee",
WITNESSETH:
WHEREAS,
PPL has heretofore adopted the Directors Deferred Compensation Plan for certain
of the members of its Board of Directors (such members and their designated
beneficiaries where applicable being hereinafter referred to collectively as
the
"Participants" and individually as a "Participant") and may hereafter adopt
other such plans or other agreements; and
WHEREAS,
PPL has heretofore entered into a trust agreement dated April 1, 2001 between
PPL, as grantor, and Wachovia Bank, as trustee, titled the PPL Director
Nonqualified Plans Trust (the "Director Plans Trust"); and
WHEREAS,
PPL wishes to establish this grantor trust, hereinafter called the "Trust,"
for
the collective investment of such property as may from time to time be
contributed thereto, subject only to the claims of PPL's general creditors
in
the event of PPL's Insolvency (as defined in Article III); and
WHEREAS,
PPL wishes the Trust to be used in connection with such plans or agreements
as
have been designated under Article X and Appendix A of the Director Plans Trust
(which plans and agreements are hereinafter called the "Plans" collectively
or
the "Plan" individually), although the Trust may not necessarily hold sufficient
assets to satisfy all of the benefits to be provided under the Plans, and which
together with the Director Plans Trust is intended to fund certain benefits
provided under the Plans in connection with a "Change in Control" (as defined
in
Paragraph 10.3); and
WHEREAS,
the Trustee is willing to hold and administer such trust assets pursuant to
the
terms of this Trust Agreement.
NOW,
THEREFORE, in consideration of the premises and of the mutual covenants herein
contained, PPL and the Trustee intending to be legally bound hereby, do covenant
and agree as follows:
Article
I
Establishment,
Purpose and Nature of Trust Fund
1.1 PPL
hereby establishes with the Trustee a trust consisting of such cash and/or
marketable securities as shall be paid to the Trustee with respect to the Plans
pursuant to Article II, Paragraph 2.1. The Trust shall be known as the PPL
REVOCABLE NONQUALIFIED DIRECTOR PLANS TRUST. The creation of this Trust is
not
intended to create an employee benefit plan subject to Title I of the Employee
Retirement Income Security Act of 1974. The Trust is intended to constitute
an
unfunded arrangement and shall not affect the status of the Plans as unfunded
plans maintained for the purpose of providing deferred compensation for a select
group of management or highly compensated employees for purposes of Title I
of
the Employee Retirement Income Security Act of 1974, as amended.
1.2 The
Trust
shall consist of all contributions to the Trust by PPL and the earnings and
losses thereon (including unrealized gains and losses), less disbursements
therefrom (hereinafter called the "Trust Fund"). The principal of the Trust,
and
any earnings thereon shall be held separate and apart from other funds of PPL
and shall be used exclusively for the uses and purposes of Participants, and
general creditors as herein set forth. Participants shall have no preferred
claim on, or any beneficial ownership interest in, any assets of the Trust.
Any
rights created under the Plans and this Trust Agreement shall be mere unsecured
contractual rights of Participants against PPL. Any assets held by the Trust
will be subject to the claims of PPL's general creditors under federal and
state
law in the event PPL becomes Insolvent.
1.3 The
Trust
hereby established is revocable and amendable by PPL] at all times.
1.4 The
Trust
Fund shall be held by the Trustee, subject to the reservation of powers under
Paragraphs 10.1 and 10.2 of Article X, for the purpose of providing, immediately
prior to a Change in Control, or at such other time or times as PPL may in
its
sole discretion determine, funds to the Trustee under the Director Plans Trust.
The Trustee shall pay to the Director Plans Trust, on notice from PPL that
the
time identifiable as immediately prior to a Change in Control has occurred,
all
or such other amount of assets from the Trust Fund to the Director Plans Trust,
as directed by PPL. Notwithstanding the foregoing, the Trust Fund shall be
treated as an asset of PPL and shall remain subject to the claims of PPL's
general creditors in the event of PPL becomes Insolvent.
1.5 The
rights, powers, titles, duties, discretions and immunities of the Trustee shall
be governed solely by this Trust Agreement and applicable state and federal
law.
1.6 The
Trust
is intended to be a grantor trust, of which PPL 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, Sections 671-678, and any successor
statute thereto, and shall be construed accordingly.
1.7 The
Director Plans Trust and any persons who may be entitled to benefit payments
under the terms of the Plans shall not have any preferred claim on the Trust
Fund.
1.8 Notwithstanding
anything else in this Agreement to the contrary: (1) the Trustee is not a party
to, and has, except as expressly provided herein, no duties or responsibilities
under, the Plans; (2) PPL shall be required to certify in writing to the Trustee
the identity of any party or person, whether or not a fiduciary named in any
Plans, which has the power to manage and control Plan assets, and the Trustee
shall be entitled to rely upon such certification until notified otherwise
in
writing by PPL; and (3) in any case in which a provision of this Agreement
conflicts with any provision in any Plans, this Agreement shall control.
Notwithstanding the preceding sentence, the Trustee reserves the right to seek
a
judicial and/or administrative determination as to its proper course of action
under this Agreement.
1.9 The
intent of this Trust Agreement is to provide PPL with a revocable trust that
holds funds that may be available to pay to the Director Plans Trust at any
time, or should a Change in Control be imminent. The Trustee under this Trust
Agreement shall have no responsibility concerning the Plans except for the
requirement set forth in Paragraph 1.4. Although this Trust Agreement may be
funded upon the occurrence of a Potential Change in Control (as defined in
Paragraph 10.3), PPL, in its sole discretion, at any time, may instruct the
Trustee to return all Trust Funds to PPL, or may revoke the
Trust.
Article
II
Contributions
to Trust Fund and Allocation to Plan Accounts
2.1 Subject
to the provisions of Paragraph 2.2, PPL may from time to time make, or cause
to
be made, such contributions to the Trust Fund of cash and/or marketable
securities as it determines to be appropriate in its sole discretion and are
acceptable to the Trustee, which shall be held by the Trustee for the benefit
of
the Director Plans Trust, subject to the reservation of powers under Article
X
and the claims of PPL's general creditors in the event PPL becomes Insolvent.
The Trustee shall be accountable for all such contributions, but shall have
no
duty to determine that the amounts thereof comply with the provisions of the
Plans.
2.2 Upon
the
occurrence of a Potential Change in Control, the Chief Executive Officer of
PPL
(or his or her designee) may authorize a cash contribution to be made to the
Trust in an amount that, in the determination of PPL, is sufficient to pay
each
Participant or beneficiary the benefits to which Participants or their
beneficiaries would be entitled pursuant to the terms of the Plans as of the
date of the Change in Control assuming each Participant ceased providing
services as of such date under circumstances giving rise to payment of benefits
under the Plans or any other amount determined by PPL, in its sole discretion.
2.3 The
Trustee shall hold the Trust Fund without distinction as to principal or income
as a single commingled fund. The Trustee shall advise PPL of the Fair Market
Value (as defined in Paragraph 2.4 below) of assets in the Trust Fund as of
the
close of each calendar year of the Trust, or at such more frequent intervals
as
may be mutually agreed upon between PPL and the Trustee.
2.4 For
purposes of this Trust Agreement, "Fair Market Value" for any security shall
be
determined as follows:
(a) securities
listed on the New York Stock Exchange, the American Stock Exchange or any other
recognized exchange shall be valued at their last sale prices on the exchange
on
which securities are principally traded on the valuation date (NYSE-Composite
Transactions or AMEX-Composite Transactions prices to prevail on any security
listed on either of these exchanges as well as on another exchange); and where
no sale is reported for that date, the last bid price shall be
used.
(b) all
other
securities and assets shall be valued at their market values as fixed by the
Trustee's staff regularly engaged in such activities.
Article
III
Cessation
of Payments from
Trust
Fund While Company Insolvent
3.1 The
Trust
Fund shall be subject to claims of general creditors of PPL in the event PPL
becomes Insolvent, and at any time the Trustee has actual knowledge, or has
determined, that PPL is Insolvent, the Trustee shall deliver the Trust Fund
to
satisfy such claims as a court of competent jurisdiction may direct. PPL shall
be considered "Insolvent" for purposes of this Trust Agreement if (1) PPL is
unable to pay its debts as they become due or (2) PPL is subject to a pending
proceeding as a debtor or a debtor-in-possession under the federal Bankruptcy
Code, 11 U.S.C. 101 et
seq. (or
any
successor federal statute).
3.2 At
all
times during the continuance of this Trust, as provided in Section 1.3 hereof,
the principal and income of the Trust shall be subject to claims of general
creditors of PPL under federal and state law as set forth below.
3.3 The
Board
of Directors and the Chief Executive Officer of PPL shall have the duty to
inform the Trustee in writing that PPL has become Insolvent and the basis on
which they consider PPL to be Insolvent. If a person claiming to be a creditor
of PPL alleges in writing to the Trustee that PPL has become Insolvent, the
Trustee shall determine whether PPL is Insolvent and, pending such
determination, the Trustee shall be excused from compliance with any instruction
by PPL for payment of funds to any person.
3.4 If
the
Board of Directors or the Chief Executive Officer of PPL informs the Trustee
in
writing that PPL has become Insolvent, the Trustee shall independently
determine, within a reasonable time that in no event shall exceed sixty days
after receipt of such notice, whether PPL is Insolvent and, pending such
determination, the Trustee shall make no payments from the Trust Fund (unless
otherwise required by applicable law), shall hold the Trust Fund for the benefit
of PPL's general creditors, and shall resume payments from the Trust Fund only
after the Trustee has determined that PPL is not Insolvent (or is no longer
Insolvent, if the Trustee initially determined PPL to be
Insolvent).
3.5 If
at any
time the Trustee has determined that PPL is Insolvent, the Trustee shall make
no
payments to Participants and shall hold the assets of the Trust for the benefit
of PPL's general creditors. Nothing in this Trust Agreement shall in any way
diminish any rights of Participants or their beneficiaries to pursue their
rights as general creditors of PPL with respect to benefits due under the Plans
or otherwise.
3.6 The
Trustee shall permit payment of Trust Funds in accordance with Article IV of
this Trust Agreement only after the Trustee has determined that PPL is not
Insolvent (or is no longer Insolvent). If the Trustee discontinues payments
from
the Trust Fund and subsequently resumes such payments, the first payments
following such discontinuance shall include the aggregate amount of all payments
which would have been made under Article IV during the period of such
discontinuance (together with interest based upon the daily average, as
determined by the Trustee, of the Average Prime Rate Charged by Banks (Percent)
as published in the Business Conditions Digest, or any successor publication,
of
the Social and Economic Statistics Administration, Bureau of Economic Analysis,
of the U.S. Department of Commerce, or any successor governmental
agency).
3.7 Except
as
provided in Paragraph 3.3 or 3.4, or unless the Trustee has actual knowledge
that PPL is Insolvent, the Trustee shall have no duty to inquire whether PPL
is
Insolvent. The Trustee may in all events rely on such evidence concerning PPL's
insolvency as may be a furnished to the Trustee which will give the Trustee
a
reasonable basis for making a determination concerning PPL's
insolvency.
3.8 Nothing
in this Trust Agreement shall in any way diminish any rights of a person to
pursue his rights as a general creditor of PPL under the Plans.
Article
IV
Payments
from Trust Fund While Company Solvent
4.1 All
payments from the Trust Fund while PPL is solvent shall be made by the Trustee
only as directed by PPL.
4.2 PPL
shall
have the right and the power at all times to direct the Trustee to return to
PPL
or to divert to others any of the Trust assets, and the right and the power
to
revoke the Trust and amend this Trust Agreement at any time.
Article
V
Responsibilities
of the Trustee
5.1 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 (the "Prudent Man Standard of Care"); 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 PPL which is contemplated by,
and
in conformity with, the terms of the Plan or this Trust and is given in writing
by PPL. In the event of a dispute between PPL and another party, the Trustee
may
apply to a court of competent jurisdiction to resolve the dispute. The Trustee
shall not be responsible for the title, validity or genuineness of any property
or evidence of title thereto received by it or delivered by it pursuant to
this
Trust Agreement and shall be held harmless in acting upon any notice, request,
direction, instruction, consent, certification or other instrument believed
by
it to be genuine and delivered by the proper party or parties. Under no
circumstances shall the Trustee be liable for consequential, special, or
speculative damages under the Trust Agreement even if the Trustee is advised
as
to the possibility thereof. It is understood and agreed that the Trustee shall
be under no duty to take any action other than herein specified with respect
to
any securities or other property at any time deposited hereunder unless
specifically agreed to by the Trustee in writing or as otherwise provided in
this Trust Agreement. Subject to PPL's power of investment direction under
Article X, the Trustee shall have exclusive authority and discretion to hold,
manage, care for and protect the Trust Fund and shall have the following powers
and discretions in addition to those conferred by law:
(a) To
invest
and reinvest the Trust Fund in such equities (of any classification, including
common and preferred stocks), fixed income, cash, cash equivalents or other
property (real, personal or mixed) and interests in investment companies and
investment trusts as the Trustee shall deem advisable, excluding any obligations
or security, or other property of PPL, whether or not such investments and
reinvestments be authorized by any state law for the investment of Trust Funds
generally;
(b) To
sell,
exchange, convey, transfer or dispose of, and also to grant options with respect
to, any property, whether real or personal, at any time held by it by private
contract or by public auction, for cash or upon credit, or partly for cash
and
partly upon credit, as the Trustee may deem best, and no person dealing with
the
Trustee shall be bound to see to the application of the purchase money or to
inquire into the validity, expediency or propriety of any such sale or other
disposition;
(c) To
compromise, compound and settle any debt or obligation due to or from it as
the
Trustee and to reduce the rate of interest thereon, to extend or otherwise
modify, or to foreclose upon default or otherwise enforce or act with respect
to
any such obligation;
(d) If
directed by PPL, the Trustee shall vote as instructed by PPL, in person or
by
general or limited proxy, any stocks or other securities at any time held in
the
Trust Fund, at any meeting of stockholders or security holders, in respect
to
any business which may come before the meeting.
(e) To
vote,
in person or by general or limited proxy, any stocks or other securities at
any
time held in the Trust Fund, at any meeting of stockholders or security holders,
in respect to any business which may come before the meeting; to exercise any
options appurtenant to any stocks, bonds or other securities for the conversion
thereof into other stocks, bonds or securities; to exercise or sell any
conversion or subscription rights appurtenant to any stocks, bonds or other
securities at any time held in the Trust Fund, and to make any and all necessary
payments therefor; to join in, and to approve, or to dissent from and to oppose,
any corporate act or proceeding, including any reorganization, recapitalization,
consolidation, merger, dissolution, liquidation, sale of assets or other action
by or plan in respect of corporations or properties, the stocks or securities
of
which may at any time be held in the Trust Fund; to deposit with any committee
or depository, pursuant to any plan or agreement of protection, reorganization,
consolidation, sale, merger, or other readjustment, any property held in the
Trust Fund; and to make payment from the Trust Fund of any charges or
assessments imposed by the terms of any such plan or agreement;
(f) To
accept
and hold any securities or other property received by it under the provisions of
any of the subdivisions of this Article whether or not the Trustee would be
authorized hereunder then to invest therein;
(g) To
borrow
money on behalf of the Trust upon such terms and conditions as the Trustee
shall
deem advisable to carry out the purposes of the Trust and to pledge securities
or other property of the Trust Fund in repayment of any such loan;
(h) To
enforce any right, obligation or claim in its discretion and in general to
protect in any way the interests of the Trust Fund, either before or after
default, and in case the Trustee shall, in its discretion, consider such action
for the best interest of the Trust Fund, to abstain from the enforcement of
any
right, obligation or claim and to abandon any property, whether real or
personal, which at any time may be held by the Trustee;
(i) To
make,
execute, acknowledge and deliver any and all deeds, leases, assignments,
transfers, conveyances and any and all other instruments necessary or
appropriate to carry out any powers herein granted;
(j) To
cause
any investments from time to time held by it hereunder to be registered in,
or
transferred into, its name as the Trustee or the name of its nominee or
nominees, and with or without designation of fiduciary capacity, or to retain
any investments unregistered or in form permitting transfer by delivery, but
the
books and records of the Trustee shall at all times show that all such
investments are part of the Trust Fund;
(k) To
hold
any part or all of the Trust Fund uninvested;
(l) The
Trustee may not invest in securities (including stock and the rights to acquire
stock) or obligations issued by PPL [or an Employer as that term is defined
in
the Plan], except by reason of the inclusion of such securities in a broadly
inclusive index, mutual fund, or collective investment medium.
Notwithstanding
anything else in this Agreement to the contrary, including, without limitation,
any specific or general power granted to the Trustee, including the power to
invest in real property, no portion of the Trust Fund shall be invested in
real
estate. For this purpose, “real estate” includes, but is not limited to, any
direct or indirect interest in real property, leaseholds or mineral
interests.
5.2 If
the
Trustee undertakes or defends any litigation arising in connection with this
Trust, the Trustee shall act only under the Prudent Man Standard of Care, and
PPL agrees to indemnify the Trustee against the Trustee’s costs, expenses and
liabilities (including, without limitation, attorney’s fees and expenses)
relating thereto and to be primarily liable for such payments if the following
conditions are met: (a) the Trustee shall notify PPL as soon as practicable
after it has received actual notice of litigation, or when the Trustee has
reached a decision to undertake litigation but prior to filing a complaint
or
other written notice to any party or agency, and (b) the Trustee shall at all
times afford PPL the reasonable opportunity to approve (which approval shall
not
be unreasonably withheld) the hiring or discharge of legal counsel and the
settlement or other conclusion of any such litigation. If PPL does not pay
such
costs, expenses and liabilities in a reasonably timely manner, the Trustee
may
obtain payment from the Trust. In no event shall the Trustee have any liability
or responsibility to undertake or defend any litigation unless the Trustee
is
reasonably assured of receiving payment of related fees and expenses. The
Trustee shall have, without exclusion, all powers conferred on trustees by
applicable law, unless expressly provided otherwise herein; provided,
however,
that if
an insurance policy is held as an asset of the Trust, the Trustee shall have
no
power to name a beneficiary of the policy other than the Trust, to assign the
policy (as distinct from conversion of the policy to a different form) other
than to a successor Trustee, or to loan to any person other than PPL the
proceeds of any borrowing against such policy.
5.3 The
Trustee, at the expense of the Trust or PPL, may consult with legal counsel
(who
prior to the occurrence of a Change in Control may also be counsel for PPL
generally) with respect to any of its duties or obligations
hereunder.
The
Trustee may consult with counsel, and the Trustee shall not be deemed imprudent
by reason of its taking or refraining from taking any action, prior to the
occurrence of a Change in Control, in accordance with the opinion of counsel
for
PPL. PPL agrees to indemnify and hold the Trustee harmless from and against
any
loss, costs and expenses including without limitation reasonable attorneys'
fees
and other costs and expenses incident to any suit, action, investigation, claim
or proceeding that the Trustee may incur in the administration of the Trust
Fund, and this provision shall survive termination of this Trust Agreement
and
the Trust, provided the following conditions are met: (a) the Trustee shall
act
at all times under the Prudent Man Standard of Care, (b) the Trustee shall
notify PPL as soon as practicable after it has received actual notice of the
suit, action, investigation, claim or proceeding, and (c) the Trustee shall
at
all times afford PPL the reasonable opportunity to approve (which approval
shall
not be unreasonably withheld) the hiring or discharge of legal counsel and
the
settlement or other conclusion of any such matter. The Trustee shall not be
required to give any bond or any other security for the faithful performance
of
its duties under this Trust Agreement, except such as may be required by any
law
which prohibits the waiver thereof.
5.4 The
Trustee shall not be responsible in any manner whatsoever for the correctness
of
the recitals of fact herein (other than recitals of fact relating solely to
the
Trustee and its power and authority to enter into and perform this Trust
Agreement) all of which have been made by PPL solely; and the Trustee shall
not
be responsible or accountable in any manner whatsoever for or with respect
to
the validity or sufficiency of this Trust Agreement and makes no representation
with respect thereto. The Trustee shall not be responsible for the sufficiency
of the Trust to pay the benefits contemplated by the Plans or for the use or
application by PPL of any monies held in the Trust when disbursed in conformity
with this Trust Agreement.
5.5 During
the term of this Trust, all of the income received by the Trust, net of expenses
and taxes, shall be accumulated and reinvested.
5.6 Notwithstanding
any powers granted to the Trustee pursuant to this Trust Agreement or to
applicable law, the Trustee shall not have any power that could give this Trust
the objective of carrying on a business and dividing the gains therefrom, within
the meaning of section 301.7701-2 of the Procedure and Administrative
Regulations promulgated pursuant to the Internal Revenue Code.
5.7 The
Trustee shall not be liable for any expense, loss, claim or damage (including
counsel fees) suffered by the Plan or Participant arising out of or caused
by
any delay in, or failure of, performance by the Trustee, in whole or in part,
arising out of, or caused by, unforseeable circumstances beyond the Trustee’s
control, including without limitation: acts of God, interruption, delay in,
or
loss (partial or complete) of electrical power or external computer (hardware
or
software) or communication services (including access to book-entry securities
systems maintained by Federal Reserve Bank of New York and/or any clearing
corporation); act of civil or military authority; sabotage; natural emergency;
epidemic; war or other government actions; civil disturbance; flood, earthquake,
fire, other catastrophe; strike or other labor disturbance by employees of
nonaffiliates; government, judicial, or self regulatory organization order,
rule
or regulation; riot; energy or natural resource difficulty or shortage; and
inability to obtain materials, equipment, or transportation, provided, in all
cases, the Trustee has acted under the Prudent Man Standard of Care to mitigate,
control, and prevent losses and expenses due to such circumstances.
5.8 The
Trustee shall have no responsibility with respect to: (i) the selection or
monitoring of any insurance policies or insurance contracts held in the Trust
or
the insurers issuing such policies or contracts; or (ii) the payment of any
premiums with respect to such policies or contracts.
5.9
The
duties of the Trustee shall be limited to the assets held in the Trust, and
the
Trustee shall have no duties with respect to assets held by any other person
including, without limitation, any other trustee for the Plan.
Article
VI
Fees,
Expenses and Taxes
6.1 PPL
shall
pay the reasonable expenses incurred by the Trustee in or as a result of the
performance of its duties hereunder, including reasonable fees and expenses
for
services rendered to the Trustee, and such compensation to the Trustee as may
be
agreed upon in writing from time to time between PPL and the Trustee.
6.2 If
PPL
fails to pay any such expenses and compensation as provided for in Paragraphs
6.1, the Trustee shall pay them from the Trust Fund.
6.3 Any
taxes, including personal property taxes, income taxes, transfer taxes and
other
taxes of any kind whatsoever that may under any existing or future laws be
assessed against or levied upon or in respect of the Trust Fund or its assets
or
any interest therein shall be paid by PPL. The word "taxes" in this Article
VI
shall be deemed to include any interest or penalties that may be levied or
imposed in respect to any taxes.
Article
VII
Accounts
of the Trustee
7.1 The
Trustee shall keep accurate and detailed accounts of all investments, receipts
and disbursements and other transactions hereunder, and all accounts, books
and
records relating thereto shall be open at all reasonable times to inspection
and
audit by any person or persons designated by PPL. The cost of any audit if
requested by PPL shall be paid by PPL.
7.2 Within
ninety (90) days following the close of each calendar year, the Trustee shall
file with PPL a written account setting forth all investments, receipts,
disbursements, and other transactions of the Trust Fund effected by it during
such fiscal year including a description of all securities and investments
purchased and sold, with the cost or net proceeds of such purchases or sales,
and showing all cash, securities and other property held, including values
at
the end of such calendar year.
7.3 Upon
the
expiration of one hundred eighty days following the filing as above provided
of
such account, such account shall be considered as final and binding upon PPL,
its subsidiaries, directors, former directors, Participants, employees, former
employees, retired employees, their beneficiaries, and the Trustee, as if
settled by a court of competent jurisdiction, and the Trustee shall be forever
released and discharged from any liability or accountability to anyone in
connection with or arising or resulting from any of the acts or transactions
shown therein, except with respect to such acts or transactions as to which
PPL
shall within such one hundred eighty day period file with the Trustee written
objections or which involve manifest error, gross negligence, willful misconduct
or fraud.
7.4 Accounts
of the Trustee need only be settled with PPL. Subject to any express provision
of applicable law as may be in effect from time to time to the contrary, no
other person or party shall be entitled to any accounting by the
Trustee.
7.5 Nothing
contained in this Trust Agreement shall, however, preclude the Trustee from
having any of its accounts settled by a court of competent jurisdiction. In
any
action or proceeding for settlement of the accounts of the Trustee or concerning
administration of the Trust Fund, PPL and the Trustee shall be the only
necessary parties thereto. To the extent provided by law, service of any notice
or process upon PPL shall be deemed for all purposes service upon PPL's
subsidiaries, directors, former directors, Participants, employees, former
employees, and retired employees of PPL, and their beneficiaries and any final
judgment in any such action or proceeding shall be binding and conclusive on
PPL, employees, former employees, directors, former directors and retired
employees of PPL and their beneficiaries and the Trustee.
Article
VIII
Resignation
or Removal of the Trustee
8.1 The
Trustee may be removed by PPL to the extent provided in Article X at any time
upon sixty days notice in writing. The Trustee shall have the right to resign
at
any time by giving sixty days notice in writing to PPL, provided that such
resignation shall not become effective until a successor trustee has accepted
its appointment. Upon such removal or notice of resignation of the Trustee,
provided the Trust is not revoked, PPL shall appoint and designate a successor
Trustee, which shall be a corporate trustee qualified to conduct trust business
in Pennsylvania, which is independent of and not subject to control by PPL.
Such
successor trustee shall qualify as such by delivering a written acceptance
of
the trust to PPL and the retiring Trustee, and thereupon all the provisions
hereof shall relate and be applicable to such successor Trustee. Until the
effective date of the assumption by the successor Trustee of its duties under
this Trust Agreement, the retiring Trustee shall continue to function and be
bound hereunder as trustee hereof. Upon receipt of such written acceptance
the
retiring Trustee shall forthwith file with PPL a written account of its acts
in
the same form as its annual account above provided for in Article VII from
the
date of its last annual account to the date of the acceptance of the Trust
by
the successor trustee and settlement of such account shall be accomplished
as in
Article VII. Upon the filing of such account, the retiring Trustee shall
transfer and deliver the Trust Fund to the successor Trustee but shall be
entitled to reserve therefrom and hold such assets as it may reasonably deem
necessary to provide for any and all expenses and payments properly chargeable
against the Trust Fund or for which the Trust Fund may be liable or to which
the
retiring Trustee may be entitled by way of fees and expenses in the settlement
of its account. If the assets so withheld are insufficient or excessive for
such
purposes, the retiring Trustee shall be entitled to reimbursement for any
deficiency out of the Trust Fund from the successor Trustee, or shall deliver
the excess to the successor Trustee, as the case may be. To the extent permitted
by law, upon the transfer of the Trust Fund as above provided and the settlement
of its account, the retiring Trustee's previous annual accounts having been
settled as provided in Article VII, the retiring Trustee shall thereupon be
discharged from any further duty, obligation or responsibility with respect
to
the operation of the Trust Fund or any matter connected therewith prior to
the
delivery of said written acceptance except matters which relate to manifest
error, gross negligence, willful misconduct or fraud.
8.2 If
the
Trustee resigns or is removed, a successor shall be appointed, in accordance
with Section 8.1 hereof, by the effective date of resignation or removal under
Section 8.1. If no such appointment has been made, provided PPL has not revoked
the Trust, 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.
Article
IX
Action
of PPL
Any
action of PPL pursuant to any of the provisions of this Trust Agreement shall
be
evidenced by a written notice or direction to such effect over the signature
of:
i) any officer or ii) other representative of PPL who shall have been certified
to the Trustee by the President, Treasurer or Secretary of PPL as having such
authority. The Trustee shall be fully protected in acting in accordance with
such notices or directions. All communications from PPL to the Trustee shall
be
in writing, signed by the person designated as having such authority as PPL
shall certify to the Trustee, and the Trustee shall act and be fully protected
in acting in accordance with such communications.
Article
X
Reservation
of Powers
10.1 PPL
expressly reserves the powers to:
(a) remove
the Trustee;
(b) direct
the investment and reinvestment of the principal and income of the Trust Fund;
it shall be the duty of the Trustee to act strictly in accordance with such
investment directions, and any changes therein, as so communicated to the
Trustee from time to time in writing. To the
maximum extent permitted by law, the Trustee shall have no duty or
responsibility (i) to advise with respect to, or inquire as to the propriety
of,
any such investment direction or (ii) for any investment decisions made with
respect to the Trust by PPL. In the absence of investment direction, the Trustee
shall invest Trust assets in any manner permitted under Section
5.1.
10.2 PPL
expressly reserves the powers to:
(a) modify,
alter, amend, terminate or revoke, in whole or in part, this Trust Agreement
and
the trust hereby created to any extent and in any respect deemed advisable
by
PPL, through an action of PPL that is in writing duly executed and acknowledged
and delivered to the Trustee; provided however,
that
the rights, duties, powers, liabilities or immunities of the Trustee hereunder
shall not be changed without its written consent, except as provided upon the
Trustee's removal in Article VIII;
(b) withdraw
from the Trust Fund any property forming a part of the Trust Fund, any such
withdrawal shall be considered a revocation of this Trust solely with respect
to
such property;
(c) reallocate
amounts among Plan Accounts in the Trust Fund;
(d) require
the Trustee to furnish such information as may be reasonably requested in regard
to the operations of the Trust Fund and the investment thereof;
(e) contribute
to the Trust Fund property other than cash or marketable securities to the
extent not expressly prohibited by the Plans or within the terms of this Trust,
if acceptable to the Trustee.
10.3 For
purposes of this Trust Agreement, a Change in Control shall be deemed to have
occurred
(a) if
one of
the following events occurs:
(I)
the
following individuals cease for any reason to constitute a majority of the
number of directors then serving: individuals who, on the date hereof,
constitute the Board of Directors and any new director (other than a director
whose initial assumption of office is in connection with an actual or threatened
election contest, including but not limited to a consent solicitation, relating
to the election of directors of the Company) whose appointment or election
by
the Board of Directors or nomination for election by the Company's shareowners
was approved or recommended by a vote of at least two-thirds (2/3) of the
directors then still in office who either were directors on the date hereof
or
whose appointment, election or nomination for election was previously so
approved or recommended;
(II)
any
Person becomes the Beneficial Owner, as defined below, directly or indirectly,
of securities of the Company representing 20% or more of the combined voting
power of the Company's then outstanding securities entitled to vote generally
in
the election of directors;
(III)
there is consummated a merger or consolidation of the Company or any direct
or
indirect subsidiary of the Company with any other corporation or other entity,
other than (I) a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior to such merger or
consolidation continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity or any parent
thereof), in combination with the ownership of any trustee or other fiduciary
holding securities under an employee benefit plan of the Company or any
subsidiary of the Company, at least 60% of the combined voting power of the
securities of the Company or at least 60% of the combined voting power of the
securities of such surviving entity or any parent thereof outstanding
immediately after such merger or consolidation; or (II) a merger or
consolidation effected to implement a recapitalization of the Company (or
similar transaction) in which no Person is or becomes the Beneficial Owner,
directly or indirectly, of securities of the Company (excluding in the
securities Beneficially Owned by such Person any securities acquired directly
from the Company or its Affiliates) representing 20% or more of the combined
voting power of the Company's then outstanding securities;
(IV)
the
shareowners of the Company approve a plan of complete liquidation or dissolution
of the Company; or
(V)
the
Board of Directors adopts a resolution to the effect that a "Change in Control"
has occurred or is anticipated to occur.
(b) For
purposes of this Trust Agreement, a "Potential Change in Control" shall be
deemed to have occurred if the event set forth in any one of the following
paragraphs shall have occurred:
(I)
the
Company enters into an agreement, the consummation of which would result in
the
occurrence of a Change in Control;
(II)
the
Company or any Person publicly announces an intention to take or to consider
taking actions which if consummated would constitute a Change in
Control;
(III)
the
Board of Directors adopts a resolution to the effect that, for purposes of
this
Agreement, a Potential Change in Control has occurred; or
(IV)
any
Person is or becomes the Beneficial Owner, directly or indirectly, of securities
of the Company representing 5% or more of the combined voting power of the
Company's then outstanding securities entitled to vote generally in the election
of directors.
Notwithstanding
the foregoing, a "Potential Change in Control" shall not be deemed to occur
if
(i) a Person acquired such beneficial ownership of 5% or more of the Company's
outstanding common shares but less than 20% and such Person has reported or
is
required to report such ownership on Schedule 13G under the Securities Exchange
Act of 1934 (the "Exchange Act") (or any comparable or successor report); (ii)
a
Person acquired such beneficial ownership of 5% or more of the Company's
outstanding common shares and such Person has reported or is required to report
such ownership under Schedule 13D under the Exchange Act (or any comparable
or
successor report), which Schedule 13D does not state any intention to or reserve
the right to control or influence the management or policies of the Company
or
engage in any of the actions specified in Item 4 of such Schedule (other than
the disposition of the common shares) and, within 10 business days of being
requested by the Company to advise it regarding the same, certifies to the
Company that such Person acquired common shares amounting to 5% or more of
the
Company's outstanding common shares inadvertently and who or which, together
with all Affiliates thereof, thereafter does not acquire additional common
shares while the Beneficial Owner, as such term is defined in or used by
Regulation 13D-G as promulgated under the Exchange Act, of 5% or more of the
common shares then outstanding; provided, however, that if the Person requested
to so certify fails to do so within 10 business days, then a Potential Change
in
Control shall be deemed to have occurred immediately after such 10-Business-Day
period; or (iii) any Person who becomes the Beneficial Owner of 5% or more
of
the common shares then outstanding due to the repurchase of common shares by
the
Company unless and until such Person, after becoming aware that such Person
has
become the Beneficial Owner of 5% or more of the common shares then outstanding,
acquires beneficial ownership of additional common shares representing 1% or
more of the common shares then outstanding.
(c) For
purposes of this Paragraph 10.3:
"Beneficial
Owner" shall have the meaning set forth in Rule 13d-3 under the Exchange Act;
and "Person" shall have the meaning given in Section 3(a)(9) of the Exchange
Act, as modified and used in Sections 13(d) and 14(d) thereof, except that
such
term shall not include (i) PPL or any of its subsidiaries, (ii) a trustee or
other fiduciary holding securities under an employee benefit plan of PPL or
any
of its Affiliates (as defined in Rule 12b-2 promulgated under Section 12 of
the
Exchange Act), (iii) an underwriter temporarily holding securities pursuant
to
an offering of such securities, or (iv) a corporation owned, directly or
indirectly, by the stockholders of PPL in substantially the same proportions
as
their ownership of stock of PPL.
10.4 The
Board
of Directors or the Chief Executive Officer may notify the Trustee in writing
as
promptly as practicable following the occurrence of a Change in Control or
Potential Change in Control, and the Trustee shall not be charged with knowledge
of such Change in Control or Potential Change in Control in the absence of
written notification.
Article
XI
Surplus
Plan Accounts and Termination of Trust
Unless
the Trust is terminated or revoked under Article X, the Trust shall not
terminate until the date that the Director Plans Trust
terminates.
Article
XII
Merger
or Consolidation of the Trustee
Any
corporation into which the Trustee may be merged or with which it may be
consolidated, or any corporation resulting from any merger, reorganization
or
consolidation to which the Trustee may be a party, or any corporation to which
all or substantially all of the trust business of the Trustee may be transferred
shall be the successor of the Trustee hereunder without the execution or filing
of any instrument or the performance of any further act; provided that in case
of any such transfer of trust business the transferee corporation shall file
with PPL written acceptance of the Trust hereby created.
Article
XIII
Miscellaneous
13.1 This
Trust Agreement, as amended from time to time, shall be administered, construed
and enforced according to the laws of the Commonwealth of Pennsylvania and
in
courts situated in that Commonwealth. The situs of the Trust shall be Lehigh
County, Pennsylvania.
13.2 This
Trust Agreement may be executed in any number of counterparts, each of which
shall be deemed an original, and said counterparts shall constitute but one
and
the same instrument.
13.3 Nothing
in this Trust Agreement shall require PPL to retain any director or employee
in
its service or the service of any of its subsidiaries.
13.4 The
Trustee by joining in the execution of this Trust Agreement hereby signifies
its
acceptance of the Trust hereby created.
13.5 Notwithstanding
anything in this Trust Agreement to the contrary, this Trust shall terminate
no
later than twenty one years after the death of the last survivor in being upon
the cessation of PPL's powers under Article X of the class consisting of the
persons entitled to receive benefits under the Plans.
13.6 No
attempt by any person entitled to benefits under the Plans to assign, alienate,
anticipate, sell, transfer, pledge, encumber or place a charge upon any benefit
or any installment thereof shall be recognized by the Trustee, nor shall the
Trustee recognize any such attempt to attach or garnish or otherwise subject
the
Trust Fund or any benefit or any installment thereof to legal process, except
as
the Trustee may be required to do by law.
13.7 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.
13.8 This
Trust Agreement shall be binding upon any successors or assigns of PPL and
any
transferee(s) of all or substantially all of PPL's assets.
13.9 Any
notice to the Trustee shall be sent to the following:
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Wachovia
Bank, N.A.
Attn:
Xxxxxxx X. Xxxxxxxxxxx
000
Xxxx Xxxxxx, 0xx
Xxxxx XX0000
Xxxxxxx,
XX 00000
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Any
notice to PPL shall be sent to the
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PPL
Corporation
Attn:
Xxxxx X. Xxxx
Xxx
Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx,
Xxxxxxxxxxxx 00000
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Either
party hereto may designate a new representative for the purpose of receiving
notices by notifying the other party in writing of the name and address of
such
new representative.
IN
WITNESS WHEREOF, this Trust Agreement has been duly executed by the authorized
officers of the parties hereto.
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PPL
CORPORATION
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ATTEST:
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By:
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Name:
Xxxxx
X.
Xxxx
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Title:
Vice
President-Finance and Treasurer
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Date:
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WACHOVIA
BANK, N.A. AS TRUSTEE
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ATTEST:
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By:
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Name:
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Title:
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Date:
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