I N D E N T U R E made the 13th day of July, 2005, by and between
XXXXXX X. XXXXXXXXX, having an office at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
(sometimes hereinafter referred to as the "Grantor"), and XXXX XXXXXXXXX,
residing at 00 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxx, XXXX XXXXXXXXX, residing at
00 Xxxxxxxxx Xxxxxx, Xxxxxxxxx XX 16 East, White Plains, New York, and XXXXXX
XXXXXXXX, residing at 00 Xxxxxxxxx Xxxx, Xxxxxxxxx, Xxx Xxxx, (sometimes
hereinafter referred to as the "Trustees").
W I T N E S S E T H :
WHEREAS, the Grantor desires to create a trust of the property and
for the purposes hereinafter mentioned,
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the Grantor shall fund this Trust by transferring to
the Trustees property to be listed in a Schedule A to be annexed hereto
("Funding"), and upon receipt of such Funding, the Trustees agree to hold such
property, IN TRUST, NEVERTHELESS, for the uses and purposes, for the term, and
subject to the provisions, conditions, powers and agreements hereinafter set
forth:
FIRST: From the date of Funding until the second anniversary
thereafter, the Trustees shall pay the Annuity Amount (as hereinafter defined)
to the Grantor, or if the Grantor is not living, to the legal representatives of
the Grantor's estate. The Annuity Amount shall be paid annually on the day
preceding the month and day of Funding for each year during the trust term and
on the last day of the trust term. The
Annuity Amount for each year shall be the following percentages of the initial
fair market value, as of the date of Funding of the assets contributed to the
trust as finally determined for federal gift tax purposes.
Year in Which Percentage of Initial
Anniversary Date Falls Fair Market Value
---------------------- ---------------------
2006 48.71392%
2007 58.45670%
In any event, the Annuity Amount for any year shall be paid
not later than 105 days after the scheduled payment date for such year as
hereinabove provided. The Annuity Amount shall be paid from income and, to the
extent income is not sufficient, from principal. Any income not so paid shall be
added to principal. Payments of the Annuity Amount for a period of less than a
full year shall be prorated on a daily basis. No additional contributions shall
be made to the trust. The interest of the Grantor shall not be subject to
commutation. During the trust term, no payment shall be made to any person other
than the Grantor (or the Grantor's estate). The Trustees shall not issue a note,
other debt instrument, option or other similar financial arrangement in
satisfaction of the annuity payment obligation. If an incorrect payment of the
Annuity Amount is made, the Trustees shall, promptly after the error is
discovered, pay to the Grantor or the Grantor's estate in the case of an
underpayment or collect from the Grantor or the Grantor's estate in the case of
an overpayment, an amount equal to the difference between the amount which the
Trustees should have paid the Grantor or the Grantor's estate and the amount
which the Trustees paid the Grantor or the Grantor's estate. The fiscal year of
the trust shall be the calendar year.
The Grantor intends to create a trust in which the Grantor
retains the right to receive a "qualified interest," as defined in section
2702(b)(1) of the Internal Revenue Code and the Regulations thereunder, and this
Indenture shall be so interpreted and may be so amended by the Trustees in order
to so qualify.
Upon the expiration of the trust term, the Trustees shall
divide and set apart the then principal and any undistributed income of this
Trust (other than any amount distributable to the Grantor or the Grantor's
estate pursuant to the preceding paragraphs of this Article) into three (3)
equal shares. One (1) share shall be paid to each of XXXX XXXXXXXXX, XXXX
XXXXXXXXX and XXXXXX XXXXXXXX, if they are then living; provided, however, that
if any of XXXX XXXXXXXXX, XXXX XXXXXXXXX or XXXXXX XXXXXXXX is not then living
but has issue then living, then his or her share shall be paid to such issue in
equal shares per stirpes; provided further, however, that the Trustee
hereinafter named shall hold, manage, invest and reinvest each share or portion
thereof payable to the Grantor's grandson, XXXXXXXX XXXXXXXX, IN TRUST, and
such share or portion thereof shall constitute a separate trust and shall be
disposed of in accordance with the provisions of Article "SECOND" hereof
(hereinafter referred to as the "Article 'SECOND' Trust"), and the Trustee
hereinafter named shall hold, manage, invest and reinvest each share or portion
thereof payable to the Grantor's granddaughter, XXXXXXX XXXXXXXXX, IN TRUST,
and such share or portion thereof shall constitute a separate trust and shall be
disposed of in accordance with the provisions of Article "THIRD" hereof
(hereinafter referred to as the "Article 'THIRD' Trust").
SECOND: Property directed to be disposed of as provided in this
Article "SECOND" shall be disposed of as follows:
A. During the lifetime of the Grantor's grandson, XXXXXXXX
XXXXXXXX (hereinafter referred to as the "beneficiary"), the Trustee, at any
time and from time to time, may pay to or apply for the benefit of the
beneficiary so much, all or none of the net income and principal of the trust as
the Trustee, in his sole and absolute discretion, shall deem necessary or
advisable.
B. Upon the death of the beneficiary, the then principal
and undistributed income, if any, of the trust shall be paid to the then living
issue of such beneficiary, in equal shares, per stirpes. If there are no such
issue of the beneficiary then living, the same shall be paid to the then living
issue of the Grantor's most remote descendant who is an ancestor of the deceased
beneficiary and who has issue then living, in equal shares, per stirpes, or if
none, to the Grantor's then living issue, in equal shares, per stirpes;
provided, however, any property which would otherwise pass outright under this
clause to a beneficiary for whom a trust is being held under Article "THIRD"
shall be added to the principal of such trust, to be administered and disposed
of as part thereof.
THIRD: Property directed to be disposed of as provided in this
Article "THIRD" shall be disposed of as follows:
A. During the lifetime of the Grantor's granddaughter,
XXXXXXX XXXXXXXXX (hereinafter referred to as the "beneficiary"), the Trustee,
at any time and from time to time, may pay to or apply for the benefit of the
beneficiary so much, all or none of the net income and principal of the trust as
the Trustee, in his sole and absolute discretion, shall deem necessary or
advisable.
B. Upon the death of the beneficiary, the then principal
and undistributed income, if any, of the trust shall be paid to the then living
issue of such beneficiary, in equal shares, per stirpes. If there are no such
issue of the beneficiary then living, the same shall be paid to the then living
issue of the Grantor's most remote descendant who is an ancestor of the deceased
beneficiary and who has issue then living, in equal shares, per stirpes, or if
none, to the Grantor's then living issue, in equal shares, per stirpes;
provided, however, any property which would otherwise pass outright under this
clause to a beneficiary for whom a trust is being held under Article "SECOND"
shall be added to the principal of such trust, to be administered and disposed
of as part thereof.
FOURTH: A. The Grantor nominates his grandson, XXXXXX XXXXXXXXX, as
Trustee of the Article "SECOND" Trust. If the Grantor's grandson, XXXXXX
XXXXXXXXX, is not then living, or fails to qualify or, having qualified, ceases
to act as Trustee for any reason whatsoever, then the Grantor nominates the
Grantor's granddaughters, XXXXXX XXXXXXXX and XXXXXXXX XXXXXXXX, in his place
and stead.
B. The Grantor nominates the Grantor's son, XXXX XXXXXXXXX,
as Trustee of the Article "THIRD" Trust. If the Grantor's son, XXXX XXXXXXXXX,
is not then living, or fails to qualify or, having qualified, ceases to act as
Trustee for any reason whatsoever, then the Grantor nominates the Grantor's
grandson, XXXXXX XXXXXXXXX, in his place and stead.
FIFTH: With respect to any property distributable absolutely to an
infant remainderman, the Trustees in their sole and absolute discretion are
authorized to retain
possession of and manage the same during such infant's minority, with all the
rights, powers and compensation of the Trustees hereunder, and from time to time
to apply so much of the income and principal thereof to the use of said infant
as they deem advisable, accumulating any balance of the income and adding the
same to principal at convenient intervals; upon said infant's attaining majority
(or upon his sooner death), the then principal and any accumulated income shall
be distributed to said infant (or his or her estate); this power shall not
affect the vesting of said property in said infant.
In determining the amount of income or principal applicable
to the use of an infant, the Trustees are authorized to disregard the ability of
the parent or parents of said infant to support said infant and to make payment
of any income or principal applicable to the use of or payable to an infant: (1)
to the Guardian (qualified in any jurisdiction) of the person or property of
such infant; (2) to the parent or parents of such infant (whether or not legally
appointed his or her Guardian); (3) to the extent permitted by law, to a
Custodian for such infant under a Uniform Gifts to Minors Act or a Uniform
Transfers to Minors Act; or (4) to apply the same for his or her benefit. The
receipt of such Guardian, parent or Custodian, or the evidence of the
application of such income or principal, shall be a full discharge to the
Trustees for such payment.
SIXTH: The Trustees shall have the following power and authority,
which shall be deemed supplemental to and not exclusive of the general powers
and authority of trustees pursuant to law and which may be exercised by them at
any time and from time to time as they in their absolute discretion deem
advisable:
A. To hold and retain all or any part of the trust created
hereby in the form in which the same may be at the time of receipt by the
Trustees as long as they may deem advisable, without liability for any
loss resulting from lack of diversification. The Trustees shall be
absolved and exonerated from any individual responsibility for any loss
which may result to the trust in connection with their retention of any
stock of Sequa Corporation.
B. To invest and reinvest any funds in the trust created
hereby in any property, real or personal, of any kind or nature,
including, without limitation, stocks, whether common or preferred, or
otherwise, bonds, secured or unsecured obligations, mortgages, other
securities, and interests in any of the foregoing, improved or unimproved
real property or tangible personal property that they may, in their
absolute discretion, deem advisable, without regard to any duty to
diversify or to make such property productive of income, and in any
manner, including by direct purchase, entry into a joint venture, creation
of or purchase of an interest in any form of partnership or corporation or
through any other form of participation or ownership, without being
limited or restricted to investments prescribed or authorized for trustees
by the laws of New York or any other state.
C. To sell, exchange, partition or otherwise dispose of,
any property, real or personal, which may at any time form part of the
trust created hereby.
D. To borrow money in connection with the administration of
the trust created hereby; to execute promissory notes or other obligations
for
amounts so borrowed or for the purchase of any property acquired by them,
and to secure payment of any such amounts by mortgage or pledge of any
real or personal property which may at any time form part of the trust
created hereby.
E. To make loans in such amounts, upon such terms, secured
or unsecured, at such rates of interest, and to such persons, firms or
corporations as they may deem advisable.
F. To renew or extend the time of payment of any
obligation, secured or unsecured, payable to the trust created hereby for
as long a period or periods of time and on such terms as they may
determine; and to adjust, settle, compromise and arbitrate claims or
demands in favor of or against the trust created hereby.
G. In respect of any securities forming a part of the trust
created hereby, including but not limited to the stock of Sequa
Corporation which is contributed to the trust, to vote upon any
proposition or election at any meeting, and to grant proxies to vote at
any such meetings; to join in or become a party to any reorganization,
readjustment, merger, voting trust, consolidation or exchange, and to
deposit any such securities with any committee, depositary, trustee or
otherwise, and to pay out of the trust any fees, expenses and assessments
incurred in connection therewith, and to charge the same to principal; to
exercise conversion, subscription or other rights, or to sell or abandon
such rights, and to hold any new securities issued as a result of any such
readjustment, merger, voting trust, consolidation, exchange or exercise of
conversion, subscription or other rights.
H. Whenever they are required or permitted to divide or
distribute the trust created hereby, to make such division or distribution
in kind or in money, or in part kind and in part money, without the
consent of any beneficiary.
I. The powers herein granted to the Trustees are intended
to allow the Trustees to exercise the powers and discretion herein
conferred as fully and unrestrictedly as if there were no such conflicting
interests. The Grantor therefore expressly exempts the Trustees from the
adverse operation of any rule of law that might otherwise apply to them in
the performance of their fiduciary duties by reason of conflict of
interest and specifically directs that they shall not have any greater
burden to justify their acts as Trustees by reason of conflict of interest
than they would have in the absence of any conflict.
SEVENTH: Any Trustee hereunder at any time may resign as Trustee
without the permission of any court and without first accounting for his
proceedings as such Trustee, by executing an instrument in writing to that
effect and delivering the same to the other Trustee or Trustees, if any; to any
person who shall be successor to the Trustee so resigning; and to the person or
persons who are then entitled or eligible to receive the income of such trust or
to the guardian or guardians of any such person or persons who may then be under
disability, but such resignation shall not operate to relieve such Trustee of
his obligation ultimately to account for his proceedings as such Trustee.
If any Trustee is under a legal disability or by reason of
illness or mental or physical disability is, in the written opinion of two
physicians then practicing medicine, unable to properly manage his or her
affairs, he or she shall be deemed
incapacitated for the purposes of this Indenture. Any Trustee deemed
incapacitated under the previous sentence shall be deemed rehabilitated when he
or she is no longer under a legal disability or when, in the written opinion of
two physicians then practicing medicine, he or she is able to properly manage
his or her affairs. Upon rehabilitation, the individual shall resume the duties
and powers he or she had prior to incapacity and his or her successor or
substitute Trustee shall relinquish all powers and be relieved of all duties.
EIGHTH: The persons acting as Trustees hereunder, by a written
instrument signed and acknowledged by all Trustees then acting, are authorized
at any time to designate an individual or a series of individuals to act as
substitute or successor to any Trustee who shall die, resign, or cease to act as
Trustee for any reason. Except in the case of the Article "SECOND" Trust and the
"Article "THIRD" Trust, in the event there is a single Trustee acting hereunder
at any time, such Trustee shall appoint, by a duly signed and acknowledged
written instrument, a co-Trustee to act with him or her so that there are at
least two Trustees acting hereunder at all times. Only the Grantor's issue, who
is not the issue of any acting Trustee, may be appointed as a substitute or
successor Trustee. Any appointment of a successor or substitute Trustee pursuant
to this Article may be revoked or changed prior to its becoming effective. No
bond or other security shall be required of any Trustee or successor or
substitute Trustee. The Grantor and his wife, XXXXXXXX XXXXXXXXX, shall not
serve as Trustees hereunder.
No Trustee acting hereunder shall be entitled to
compensation for services as Trustee, but each Trustee shall be entitled to
reimbursement for expenses incurred in performing those services.
When more than one Trustee is acting hereunder, any Trustee
may, by a signed and acknowledged written instrument filed with the trust
records and delivered to the other Trustee or Trustees, delegate to any other
Trustee from time to time the exercise of all or any of the powers conferred by
this agreement, and during any period while such delegation is in effect, such
delegating Trustee shall have no further responsibility with respect to the
exercise of such powers. Any such delegation may be revoked by such delegating
Trustee by a signed and acknowledged written instrument so filed and delivered.
When more than one Trustee is acting hereunder, any
instrument to be executed on behalf of the Trustees, including any check issued
by or to the order of the Trustees, may be made, executed, signed, endorsed or
delivered by one of the Trustees, and any person, firm or corporation, including
any bank, may rely upon and shall be protected in relying upon the signature of
any Trustee so signing with the same force and effect as though all Trustees had
signed.
All persons dealing with the Trustees, and all other persons
relying upon or claiming under any instrument executed by the Trustees with
respect to any trust property, shall be entitled to rely conclusively upon a
Trustee's representations that the Trustee has the power to perform any act and
to execute any instrument and to consummate any transaction, that the trust is
in full force and effect, and that any instrument is executed in accordance with
the provisions of this trust and is binding upon all Trustees and beneficiaries
hereunder. No person dealing with the Trustees shall be obligated to see to the
application of any property paid or otherwise transferred to the
Trustees, to see that the terms of the trust have been complied with, to inquire
into the necessity or advisability of any act of the Trustees, or to inquire, or
be privileged to inquire, into any other matter.
The Trustees in carrying out their powers and performing
their duties may act in their discretion and shall be personally liable only for
fraud or acts or omissions in bad faith. The Trustees, however, shall never have
personal liability for making or failing to make any discretionary distributions
to any beneficiary or any election under any tax law. The Trustees shall not
personally be liable for any act or omission of any agent or employee of the
Trustees unless the Trustees have acted in bad faith in the selection and
retention of such agent or employee. Any action undertaken by the Trustees shall
be conclusive and binding upon all beneficiaries hereunder, whether present or
future. No Trustee shall be liable for the acts or defaults of a co-Trustee.
Any successor or substitute Trustee at any time acting shall
have all of the rights, powers, duties and obligations of the original Trustees.
No bond or other security shall be required of any Trustee or successor or
substitute Trustee.
NINTH: Any references in this Indenture to the "issue", "children",
"grandchildren" and "descendants" of the Grantor shall not include the Grantor's
daughter, XXXXXX XXXXXXXXX, or any of her issue.
TENTH: No beneficiary shall, at any time, have the right to pledge
or assign any of the payments which may become due to him or her from time to
time, whether on account of principal or income, and any attempted pledge or
assignment shall
be ignored by the Trustees nor shall any principal or income be subject to
attachment, garnishment or any other legal proceedings while in the hands of the
Trustees.
ELEVENTH: The Grantor declares that the trust hereby created is
irrevocable and that this Indenture may not be altered, amended or modified. The
Grantor shall have the right and power at any time to reacquire any asset of the
trust if he shall simultaneously substitute therefor other property having an
equivalent value. This power shall be exercisable by the Grantor in a
nonfiduciary capacity and without the consent of any person in a fiduciary
capacity.
TWELFTH: The trust created herein shall be governed by and construed
in all respects in accordance with the laws of the State of New York. The
Trustees shall not be required to account in any court outside of New York
State.
THIRTEENTH: This instrument may be executed in two or more
counterparts, all of which, when taken together, shall constitute a single
instrument.
FOURTEENTH: The Trustees, by joining in the execution of this
instrument, signify their acceptance of the said trust and agree to execute the
same in accordance with the terms of this Indenture.
IN WITNESS WHEREOF, the parties hereto have set their respective
hands as of the day and year first above written.
/s/ Xxxxxx X. Xxxxxxxxx
-------------------
XXXXXX X. XXXXXXXXX, Grantor
/s/ Xxxx Xxxxxxxxx
--------------
XXXX XXXXXXXXX, Trustee
/s/ Xxxx Xxxxxxxxx
--------------
XXXX XXXXXXXXX, Trustee
/s/ Xxxxxx Xxxxxxxx
---------------
XXXXXX XXXXXXXX, Trustee
SCHEDULE A
----------
Property Contributed to Trust
-----------------------------
125,385 shares of Class A Common Stock, no par value, of Sequa Corporation
STATE OF NEW YORK )
) ss.:
COUNTY OF )
On the 13th day of July, in the year 2005, before me, the
undersigned, personally appeared XXXXXX X. XXXXXXXXX, known to me or proved to
me on the basis of satisfactory evidence to be the individual whose name is
subscribed to the within instrument and acknowledged to me that he executed the
same in his capacity, and that by his signature on the instrument, the
individual, or the person upon behalf of which the individual acted, executed
the instrument.
/s/ Xxxxxx X. Xxxxx
-------------------------------
Notary Public
STATE OF NEW YORK )
) ss.:
COUNTY OF )
On the 6th day of July, in the year 2005, before me, the
undersigned, personally appeared XXXX XXXXXXXXX, known to me or proved to me on
the basis of satisfactory evidence to be the individual whose name is subscribed
to the within instrument and acknowledged to me that he executed the same in his
capacity, and that by his signature on the instrument, the individual, or the
person upon behalf of which the individual acted, executed the instrument.
/s/ Xxxx Xxxxxxx
-------------------------------
Notary Public
STATE OF NEW YORK )
) ss.:
COUNTY OF )
On the 11 day of July, in the year 2005, before me, the undersigned,
personally appeared XXXXXX XXXXXXXX, known to me or proved to me on the basis of
satisfactory evidence to be the individual whose name is subscribed to the
within instrument and acknowledged to me that she executed the same in her
capacity, and that by her signature on the instrument, the individual, or the
person upon behalf of which the individual acted, executed the instrument.
/s/ Xxxxxxx Xxxxx
-------------------------------
Notary Public
