EXIBIT 10.P
TRUST AGREEMENT
between
CONSOLIDATED NATURAL GAS COMPANY
and
MELLON BANK
Effective
June 1, 1995
CONSOLIDATED NATURAL GAS COMPANY
MELLON BANK
TRUST AGREEMENT
TABLE OF CONTENTS
Page
----
ARTICLE I: ESTABLISHMENT OF TRUST.......................................3
1.1 Trust......................................................3
1.2 Description of Trust.......................................3
1.3 Acceptance by the Trustee..................................3
ARTICLE II: CLAIMS OF COMPANY'S CREDITORS................................4
2.1 No Security Interest.......................................4
2.2 Suspension of Payments.....................................4
2.3 Resumption of Payments.....................................4
2.4 Notice of Insolvency.......................................5
2.5 Insolvency.................................................5
ARTICLE III: POWERS OF TRUSTEE............................................6
3.1 Investment of the Trust....................................6
3.2 Investment Powers of Trustee...............................8
3.3 Administrative Powers of Trustee...........................8
3.4 Summary of Plan and Trust Responsibilities.................9
ARTICLE IV: TRUST OBLIGATION TO PAY PLAN BENEFITS.......................12
4.1 Nature of Trust Beneficiaries' Interest...................12
4.2 Obligations...............................................12
4.3 Individual Bookkeeping Accounts...........................12
4.4 Determination of Benefits Payable to Participants or
Beneficiaries.............................................13
4.5 Payment upon Constructive Receipt.........................17
ARTICLE V: CONTRIBUTIONS AND WITHDRAWALS................................18
5.1 Contributions.............................................18
5.2 Application of Contributions..............................19
5.3 Recovery of Trust Assets by the Company...................19
5.4 Transfer of Excess Assets to the Company..................20
5.5 Company as Owner of Assets................................20
ARTICLE VI: TAXES, EXPENSES AND COMPENSATION............................21
6.1 Taxes on Trust............................................21
6.2 Withholding Taxes; Employment Taxes.......................21
6.3 Expenses and Compensation.................................21
ARTICLE VII: ADMINISTRATION AND RECORDS.................................23
7.1 Records...................................................23
7.2 Settlement of Accounts....................................23
7.3 Audit.....................................................24
7.4 Judicial Settlement.......................................24
7.5 Delivery of Records to Successor..........................24
7.6 Tax Filings...............................................24
ARTICLE VIII: REMOVAL OR RESIGNATION OF THE TRUSTEE AND
DESIGNATION OF SUCCESSOR TRUSTEE.........................25
8.1 Resignation...............................................25
8.2 Removal...................................................25
8.3 Successor Trustee.........................................26
8.4 Transfer of Trust Fund to Successor.......................26
ARTICLE IX: ENFORCEMENT OF TRUST AGREEMENT AND LEGAL
PROCEEDINGS...............................................27
ARTICLE X: TERMINATION..................................................28
10.1 Terminations..............................................28
10.2 No Further Liability......................................28
ARTICLE XI: AMENDMENT...................................................29
11.1 Amendment.................................................29
11.2 Compliance with ERISA, the Code and other Laws............29
11.3 Execution of Amendments...................................29
ARTICLE XII: MISCELLANEOUS..............................................30
12.1 Nonalienation.............................................30
12.2 Communications............................................30
12.3 Authority to Act..........................................30
12.4 Authenticity of Instruments...............................30
12.5 Binding Effect............................................31
12.6 Inquiry as to Authority...................................31
12.7 Responsibility for Company Action.........................31
12.8 Successor to Trustee......................................31
12.9 Laws of Pennsylvania to Govern............................31
12.10 Reports...................................................31
12.11 Counterparts..............................................31
12.12 Participant to Include Beneficiary........................32
SCHEDULE A
TRUST AGREEMENT
---------------
THIS AGREEMENT, made as of the 1st day of June, 1995, between
CONSOLIDATED NATURAL GAS COMPANY, a corporation organized and existing under the
laws of the State of Delaware (the "Company"), and MELLON BANK, a banking
institution organized and doing business under the laws of the United States
with an office in Pittsburgh, Pennsylvania (the "Trustee").
WITNESSETH:
WHEREAS, the Company and certain of its subsidiaries have established
and maintain certain unfunded employee benefit plans, agreements and
arrangements for the benefit of a select group of highly compensated management
employees of the Company and its subsidiaries (which plans, agreements and
arrangements are each referred to herein individually as the "Plan" and
collectively as the "Plans"). The Plans are identified in Schedule A hereto,
which includes, inter alia, "Administrative Guidelines" for the determination of
----- ----
Benefits under the Plans and payment thereof from the Trust, and which will be
supplemented annually as provided in Section 4.4(b). Each of the management
employees entitled to benefits under one or more of the Plans is hereinafter
referred to individually as a "Participant" and collectively as the
"Participants." Each Plan provides for the payment of certain benefits (the
"Benefits") to certain of the Participants and their beneficiaries, if any,
designated by the respective Participants (or by the Plan) as being entitled to
any payments due under the terms of the Plan in the event of a Participant's
death ("Beneficiary" or "Beneficiaries"). The Company and its subsidiaries have
incurred and expect to continue to incur liabilities pursuant to the terms of
the Plans; and the Company wishes to establish the trust provided for herein
(the "Trust") to aid the Company and its subsidiaries in meeting their
obligations under the Plans. Moreover, and as provided in detail in the
Administrative Guidelines in Schedule A, the Company intends the assets of each
account established under the Trust ("Account" or "Accounts") to be available to
pay benefits solely to Participants who accrued benefits payable under a Plan or
Plans pursuant to their employment by the Company and/or those subsidiaries
identified in Schedule A. Except as otherwise provided in the immediately
preceding sentence, the Company intends the assets of the Trust to constitute a
unitary, nonsegmented source of funds
from which to pay benefits under all of the Plans as if they were a single plan,
with no benefit under any particular Plan having any priority over any other
benefit under that Plan or under any other Plan and with no assets of the Trust
designated to pay any particular benefit.
The Trust is intended to be a "grantor trust" with the corpus and
income of the Trust treated as assets and income of the Company for federal
income tax purposes pursuant to Sections 671-677 of the Internal Revenue Code of
1986, as amended (the "Code"). The Company intends that the assets of the Trust
will be subject to the claims of creditors of the Company and its subsidiaries
as provided in Article II hereof. Amounts transferred to the Trust and the
earnings thereon shall be used by the Trustee to satisfy the liabilities of the
Company and its subsidiaries in accordance with the provisions hereof. Upon
satisfaction of all liabilities of the Company and its subsidiaries with respect
to all Participants and Beneficiaries, the Trust shall terminate and the
remaining assets, if any, of the Trust shall revert to the Company.
The Company and its subsidiaries intend that the existence of the
Trust shall not alter the characteristics of the Plans as unfunded plans
maintained primarily for the purpose of providing deferred compensation for a
select group of management or highly compensated employees for purposes of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and shall
not be construed to provide income for income tax purposes to any Participant or
Beneficiary under the Plans prior to the actual payment of benefits thereunder.
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, the Company and the Trustee agree as follows:
-2-
ARTICLE I: ESTABLISHMENT OF TRUST
----------------------------------
1.1 Trust. The Company hereby establishes a Trust with the Trustee,
-----
consisting of such sums of money and other property acceptable to the Trustee as
from time to time shall be paid or delivered to the Trustee, which property may
include life insurance contracts (the "Policies" or "Policy"). All such money
and other property, all investments and reinvestments made therewith, or
proceeds thereof, and all earnings and profits thereon, less all payments and
charges as authorized herein shall constitute the "Trust Fund" or "Fund." The
Trust Fund shall be held by the Trustee in Trust and shall be dealt with in
accordance with the provisions of this Trust Agreement.
1.2 Description of Trust. The Company represents and agrees that
--------------------
the Trust established under this Agreement is, and is intended to be, a
depository arrangement with the Trustee for the setting aside of cash and other
assets of the Company as and when the Company so determines in its sole
discretion for the meeting of part or all of its future retirement and death
benefit obligations to some or all of the Participants and their Beneficiaries
under the Plans. Contributions by the Company to the Trust shall be in amounts
determined solely by the Company. The Trustee has no obligation to determine
the amount of any contribution and, except as provided in Section 5.1, with
respect to drawing upon letters of credit, has no duty to enforce payment of any
contribution. The Company further represents that the Plans are unfunded
deferred compensation plans for a select group of management or highly
compensated employees, and as such are exempt from the application of ERISA
except for the disclosure requirements applicable to such plans, for which the
Company bears full responsibility as to compliance. The Company further
represents that the Plans are not qualified under Section 401 of the Code and
therefore, are not subject to any of the Code requirements applicable to tax-
qualified plans.
1.3 Acceptance by the Trustee. The Trustee accepts the Trust
-------------------------
established under this Trust Agreement on the terms and subject to the
provisions set forth herein, and agrees to discharge and perform fully and
faithfully all of the duties and obligations imposed upon it under this Trust
Agreement. The Trustee has no responsibility or duties regarding the
administration of the Plans, except for the duties specifically described in
this Agreement.
-3-
ARTICLE II: CLAIMS OF COMPANY'S CREDITORS
------------------------------------------
2.1 No Security Interest. It is the intent of the parties hereto
--------------------
that the Trust Fund is and shall remain at all times subject to the claims of
the Company's general creditors in the event of the Company's insolvency or
bankruptcy and that each Account established under the Trust shall remain at all
times subject to the claims of the general creditors of subsidiary(ies) of the
Company which is (are) identified in Schedule A in the event of such
subsidiary's or subsidiaries' insolvency or bankruptcy. Accordingly, the
Company shall not create a security interest in the Trust Fund in favor of any
Participant or Beneficiary of the Plans or any creditor.
2.2 Suspension of Payments. Notwithstanding any provisions in this
----------------------
Agreement to the contrary, if at any time while the Trust is still in existence
the Company or a subsidiary identified in Schedule A becomes insolvent or
bankrupt (as defined herein), the Trustee shall upon receipt of written notice
thereof under Section 2.4 suspend the payment of all Benefits from the Fund (in
the event the Company becomes insolvent or bankrupt) or from the Account
identified in Schedule A as relating to such subsidiary (in the event a
subsidiary becomes insolvent or bankrupt) and shall hold the Fund or Account for
the benefit of the Company's or subsidiary's general creditors, and shall
deliver the entire amount of the Trust Fund or Account only as a court of
competent jurisdiction, or duly appointed receiver or other person authorized to
act by such a court, may direct to make the Trust Fund or Account available to
satisfy the claims of the Company's or subsidiary's general creditors. Unless
the Trustee has actual knowledge of the Company's insolvency or bankruptcy, the
Trustee shall have no duty to inquire whether the Company or subsidiary is
insolvent or bankrupt.
2.3 Resumption of Payments. The Trustee shall resume all its duties
----------------------
and responsibilities under this Trust Agreement including payments of Benefits
to Participants and Beneficiaries of the Plans within 30 days of the Trustee's
determination that the Company or subsidiary is not insolvent or bankrupt (or is
no longer insolvent or bankrupt). In making such determination, the Trustee may
retain outside experts competent to advise the Trustee as to whether the Company
or subsidiary has or still is, in fact, insolvent or bankrupt. The expense of
retaining such outside experts shall be deemed a Trust expense within the
meaning of Section 6.3.
-4-
The first payments to a Participant or Beneficiary, pursuant to a resumption of
payments, following such discontinuance shall include the aggregate amount of
all payments which would have been made to the Participant or Beneficiary in
accordance with the Plans during the period of such discontinuance, less the
aggregate amount of payments of Benefits under the Plans made to the Participant
or Beneficiary by the Company or subsidiary during any such period of
discontinuance.
2.4 Notice of Insolvency. By its approval and execution of this
--------------------
Agreement, the Company represents and agrees that its Board of Directors and
Chief Executive Officer, as from time to time acting, shall have the fiduciary
duty and responsibility on behalf of the Company's creditors to give to the
Trustee prompt written notice of any event of the Company's or a subsidiary's
insolvency or bankruptcy and the Trustee shall be entitled to rely thereon to
the exclusion of all directions or claims to pay Benefits thereafter made.
2.5 Insolvency. The Company or subsidiary shall be deemed to be
----------
insolvent or bankrupt upon the occurrence of any of the following:
(a) The Company or subsidiary is unable to pay its debts as they
fall due; or
(b) The Company or subsidiary shall make an assignment for the benefit
of creditors, file a petition in bankruptcy, petition or apply to any tribunal
for the appointment of a custodian, receiver, liquidator, sequestrator, or any
trustee for it or a substantial part of its assets, or shall commence any cause
under any bankruptcy, reorganization, arrangement, readjustment of debt,
dissolution, or liquidation law or statute of any jurisdiction (federal or
state), whether now or hereafter in effect; or if there shall have been filed
any such petition or application, or any such case shall have been commenced
against it, in which an order for relief is entered or which remains
undismissed; or the Company or subsidiary by any act or omission shall indicate
its consent to, approval of or acquiescence in any such petition, application or
case or order for relief or to the appointment of a custodian, receiver or any
trustee for it or any substantial part of any of its property, or shall suffer
any such custodianship, receivership, or trusteeship to continue undischarged.
-5-
ARTICLE III: POWERS OF TRUSTEE
-------------------------------
3.1 Investment of the Trust.
-----------------------
(a) The Trust Fund shall be invested by the Trustee in accordance with
the written investment guidelines provided from time to time to the Trustee by
the Company or by an investment committee appointed by the Board of Directors of
the Company. If no such guidelines are received by the Trustee, the assets of
the Trust Fund, other than the Policies, shall be invested in investments
emphasizing safety of principal, such as a short-term income fund maintained by
the Trustee, or in short-term debt securities issued or guaranteed by the U.S.
government, cash equivalents, and the like. Subject to the foregoing, the
Trustee shall have the power to invest or reinvest assets in the Trust Fund in
any personal or intangible property, without restriction to securities or
property of the character authorized for investments by trustees under any
statute or other laws of any state, district or territory, including without
limitation any of the following: common or preferred stocks or other evidences
of ownership in any corporation, partnership, mutual fund, investment company,
association, joint venture or business trust; indebtedness issued by
corporations (including those convertible to common stock), or issued or
guaranteed by the United States or any agency or instrumentality thereof, or any
state, municipality or agency or instrumentality thereof; savings accounts,
certificates of deposits and other types of time deposits and other types of
time deposits with any financial institution under the supervision of the United
States or any state, including the Trustee in its corporate capacity or any
affiliate, department or division of the same; or individual or group insurance
policies, including annuity or investment contracts, where directed by the
Company; provided, that permitted investments shall not include any interest,
direct or indirect, in real estate. Permitted investments shall also include
units in any common, collective or pooled trust fund operated or maintained
exclusively for the commingling and collective investment of monies or other
assets of plans like the Plan, including without limitation any fund operated or
maintained by the Trustee. Notwithstanding any other provision of this
Agreement, to the extent trust assets are used to acquire units in any
collective trust, the terms and conditions of its trust indenture shall solely
govern the investment duties and responsibilities of the fund trustee, and to
the extent required by law, the terms and conditions of
-6-
such trust indenture shall be incorporated herein by reference. For purposes of
valuation, the value of the interest maintained by the Trust in such collective
fund shall be the fair market value of the collective fund units held,
determined in accordance with generally recognized valuation procedures. The
Company expressly understands and agrees that any such collective fund may
provide for the lending of its securities by the fund trustee and that such
fund's trustee will receive compensation for the lending of securities that is
separate from any compensation of the Trustee hereunder, or any compensation of
the fund trustee for the management of such fund.
(b) Notwithstanding anything in the Trust Agreement to the contrary,
(i) the Company shall have the right and power at any time and from time to time
to contribute one or more Policies to the Trust Fund, and to direct the Trustee
to acquire one or more Policies and to pay premiums from the Trust Fund in
accordance with any such Policy, and (ii) except as the Company shall otherwise
direct, the Trustee shall hold each Policy as part of the Trust Fund and shall
neither transfer any Policy, make or cause to be made any loans, withdrawals,
surrenders or other distributions under any Policy, nor surrender, assign,
amend, modify or terminate any Policy; provided, however, the foregoing
notwithstanding, if the Company fails to contribute Qualified Assets to the
Trust pursuant to Section 5.1(c), the Trustee will surrender any or all policies
to obtain cash to pay Benefits to Participants or Beneficiaries; and the Trustee
may make or cause to be made loans, withdrawals, surrenders or other
distributions under any or all Policies, or surrender any Policy, to the extent
necessary to obtain cash to pay administrative expenses.
(c) All Policies on the life of a Participant (whether contributed by
the Company or purchased by the Trustee at the Company's direction pursuant to
Section 3.1(b)) shall be held by such Trustee until the death benefit proceeds
of such policy have been duly paid following the Participant's death; or the
Policy has been surrendered in whole or in part for its cash value for the
purpose of paying deferred compensation benefits to the Participant; or
surrendered in whole or in part for its cash value following the Participant's
forfeiture of all or part of the Benefits under a Plan (of which whole or
partial forfeiture the Company shall notify the Participant and the Trustee in
writing).
-7-
3.2 Investment Powers of Trustee. Except as limited by Section 3.1
----------------------------
or as otherwise provided in this Trust Agreement, the Trustee shall have the
following investment powers and authority with respect to all property
constituting a part of the Trust Fund in its discretion:
(a) To retain any property at any time received by it.
(b) To participate in any plan or reorganization, consolidation,
merger, combination, liquidation, or other similar plan relating to any such
property, and to consent to or oppose any such plan or any action thereunder, or
any contract, lease, mortgage, purchase, sale, or other action by any
corporation or other entity any of the securities of which may at any time be
held in the Trust Fund, and to do any act with reference thereto.
(c) To be the owner of any individual life insurance contracts or
individual or group annuity contracts and to take such action with respect to
such contracts as necessary to carry out the terms of this Trust Agreement,
including but not limited to payment of insurance premiums, repayment of policy
loans, and complete or partial surrender of such contracts to pay Plan Benefits
or Trust expenses (not otherwise provided for).
(d) Generally to do all acts, whether or not expressly authorized,
that the Trustee deems necessary or desirable for the protection of the Fund and
to carry out the purposes of this Trust Agreement.
3.3 Administrative Powers of Trustee. Except as limited by Section
--------------------------------
3.1 or as otherwise provided in this Trust Agreement, the Trustee shall have the
following administrative powers in its sole and absolute discretion:
(a) To register or hold any securities or other property held by it in
its own name or in the name of any custodian of such property or of its nominee,
including the nominee of any system for the central handling of securities, with
or without the addition of words indicating that such securities are held in a
fiduciary capacity, to deposit or arrange for the deposit of any such securities
with such a system and to hold any securities in bearer form.
(b) To engage any legal counsel, including counsel to the Company, or
any other suitable agents (including outside investment managers), accountants,
actuaries,
-8-
consultants, and other providers of services, to consult with them with respect
to the implementation and construction of this Trust Agreement, the duties of
the Trustee hereunder, the transactions contemplated by this Trust Agreement or
any act which the Trustee proposes to take or omit, to rely upon the advice of
and services performed by such persons and to pay their reasonable fees,
expenses and compensation from the Trust Fund.
(c) To exercise any right to draw cash pursuant to a letter of credit
on the Company's account which has been issued in favor of the Trust, as
described in Section 5.1.
(d) To determine whether the Company or a subsidiary is insolvent as
provided in Section 2.5 hereof.
(e) To transfer excess Trust assets to the Company as provided in
Section 5.4 hereof.
(f) Generally to do all acts, whether or not expressly authorized,
that the Trustee deems necessary or desirable for the protection of the Fund and
to carry out the purposes of this Trust Agreement.
3.4 Summary of Plan and Trust Responsibilities. The Company intends
------------------------------------------
the assets of each Account under the Trust to be available to pay benefits
solely to Participants who accrued benefits payable under a Plan or Plans
pursuant to their employment by the Company and/or those subsidiaries identified
in Schedule A. Except as otherwise provided in the immediately preceding
sentence, the Company intends the assets of the Trust to constitute a unitary,
nonsegmented source of funds from which to pay all benefits under all of the
Plans as if they were a single plan, with no benefit under any particular Plan
having any priority over any other benefit under that Plan or under any other
Plan and with no assets of the Trust designated to pay any particular benefit.
The Company further intends that no Plans be subject to the funding and design
requirements of ERISA. The Company and the Trustee agree that the Trustee has
no duty or obligation to:
a. determine the amount of any contribution to the Trust;
-9-
b. except as specifically provided in Section 5.1, with respect to
drawing upon letters of credit, enforce the payment of any
contribution to the Trust;
c. determine any benefit for any Participant or Beneficiary under
any Plan; and
d. except as otherwise provided in this Section 3.4, make any
determination as to the allocation of any Trust asset to any
particular Plan, its Participants or their Beneficiaries.
It is understood that the Trustee's only fiduciary obligation is to hold and
manage assets contributed to the Trust in accordance with the provisions of this
Agreement and that the Trustee has no duty or obligation to administer or manage
any provision of any Plan. All Plan administrative duties are the sole
responsibility of the Company or its duly appointed Plan administrators or
consultants. In accordance herewith, the Trustee has no duty or obligation to
act except upon the written direction of the Company or its duly appointed Plan
administrators or consultants (which written directions to include the
information in Schedule A as delivered to the Trustee from time to time), and
the Company agrees to indemnify and hold the Trustee unharmed against all loss
or liability (including expenses and reasonable attorneys' fees) to which it may
be subject by reason of any acts taken in accordance with any directions, or
acts omitted to be taken in good faith due to an absence of directions, from the
Company, and all loss or liability arising out of any other action or failure to
act by the Trustee in executing its duties under this Agreement unless
occasioned by the Trustee's own negligence or misconduct. No Participant,
beneficiary or third party shall have any cause of action against the Trustee
for complying with such written direction.
Notwithstanding anything else in this Agreement to the contrary: (1) the
Trustee is not a party to, and has no duties or responsibilities under, the
Plan; (2) in any and all cases where the Trustee is required by this Agreement
to act with reference to Plan terms, the Company shall have the responsibility
to certify the relevant provisions to the Trustee in writing, and the Trustee
shall be entitled to rely upon such certification until notified otherwise in
writing by the Company; (3) absent written certification to the Trustee pursuant
to this paragraph, the Trustee shall be
-10-
chargeable with no knowledge of any Plan terms and shall be deemed to be in
compliance with the Plan; and (4) in any case in which a provision of this
Agreement conflicts with any provision in the Plan, 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.
-11-
ARTICLE IV: TRUST OBLIGATION TO PAY PLAN BENFITS
-------------------------------------------------
4.1 Nature of Trust Beneficiaries' Interest. The establishment of
---------------------------------------
the Trust and the payment or delivery to the Trustee of assets shall not vest in
any Participant or Beneficiary any right, title or interest in and to any assets
of the Trust. To the extent that any Participant or Beneficiary acquires the
right to receive payments under a Plan, such right shall be no greater than the
right of any unsecured general creditor of the Company or relevant subsidiary
and such Participant or Beneficiary shall have only the unsecured promise of the
Company or subsidiary that such payments will be made.
4.2 Obligations.
-----------
(a) Obligation of Company. Notwithstanding anything in this Trust
---------------------
Agreement to the contrary, the Company shall remain primarily liable to pay Plan
Benefits.
(b) Obligation of Trustee. The Trustee shall make cash payments of
---------------------
Benefits, or shall transfer ownership of Policies, to Participants and
Beneficiaries at such times and in such amounts as are required of the Company
under the Plans as determined by the Company, or its duly appointed Plan
administrators or consultants, pursuant to Section 4.4 hereof. The Trustee has
no obligation to determine any Participant's or Beneficiary's Benefits under any
Plan, but, as provided in Section 4.4, may rely on Schedule A for determinations
or instructions regarding the payment of Benefits. The Trustee does not
guarantee the adequacy of the Trust Fund to meet and discharge any or all of the
Company's liabilities under the Plans, and, except as specifically provided in
Section 5.1 with respect to drawing upon letters of credit, the Trustee has no
obligation to require the Company to provide any funding into the Trust to
discharge such liabilities under the Plans. The Trustee is not liable for
investment performance or other loss to the Trust Fund except to the extent that
it is judicially determined that it failed to discharge its duties hereunder.
4.3 Individual Bookkeeping Accounts. The Trustee shall establish
-------------------------------
and maintain bookkeeping accounts on behalf of the Trust for particular
Participants or Beneficiaries only as directed by the Company.
-12-
4.4 Determination of Benefits Payable to Participants or
----------------------------------------------------
Beneficiaries.
-------------
(a) Determination of Benefits.
-------------------------
(1) Prior to a Change in Control (as defined in Section 4.4(f)), the
Company shall be responsible for determining a Participant's eligibility for
benefits under the Plans and the amount and duration thereof, and shall instruct
the Trustee accordingly. The Trustee shall observe the Company's instructions
unless the Participant or Beneficiary objects thereto and pursues resolution of
the dispute through legal proceedings or arbitration, in which case the Trustee
shall observe the court decree or arbitrator's award in paying benefits (if any
are awarded) to the Participant or Beneficiary.
(2) After the occurrence of a Change in Control, the Trustee shall pay
benefits to each Participant based on the last accrued benefit data provided to
the Trustee by the Company, pursuant to Section 4.4(b), prior to the Change in
Control, unless the Company and the Participant agree upon a different benefit
amount, or the Participant or the Company objects thereto and pursues resolution
of the dispute through legal proceedings or arbitration, in which case the
Trustee shall observe the court decree or arbitrator's award in paying benefits
(if any are awarded) to the Participant or Beneficiary.
(3) A Participant or Beneficiary may apply in writing directly to the
Trustee for payment of a Benefit that (i) has been awarded to the Participant or
Beneficiary by a final court decree or arbitration award, and (ii) has not been
paid by the Company. Such application shall be accompanied by a certified copy
of such court decree or arbitration award. Subject to the provisions of Article
II hereof, upon receiving an application for payment of a Benefit accompanied by
a certified copy of a court decree or arbitration award, the Trustee shall
notify the Company of the application, including the amount of the Benefit
payable, and the Trustee shall make such payments as are required by the court
decree or arbitration award, after providing the Company with an opportunity to
prove to the satisfaction of the Trustee that the Company has paid the Benefit
to the Participant or Beneficiary.
(b) Provision of Accrued Benefit Data to Trustee. At least annually,
--------------------------------------------
or more frequently, in the Company's sole discretion as determined by the
Company's Annuities and
-13-
Benefits Committee (the "Committee"), the Committee shall provide, or cause to
be provided, to the Trustee in writing the information described below, which
shall be added to and become a part of Schedule A to this Agreement. Much of
such information depends upon definitions and other provisions of the Plan
documents establishing the respective Plans, and the Company acknowledges that
it is solely responsible for interpreting the Plan documents and determining the
required information on the basis thereof. Such written information, which shall
be certified by the Committee or by the Company's Vice President, Human
Resources, shall set forth the identity of each Participant then participating
in each Plan, together with all data necessary to calculate and pay his or her
benefit under each Plan in which he or she participates, including, without
limiting the generality of the foregoing, the following:
. Name
. Social Security number
. Birth date
. Mailing address
. Direct bank deposit information
. Amount of benefit
. Payment date or dates
. Duration of benefit payments
. Name, Social Security number and birth date of joint
annuitant or beneficiary
(c) In making payment of the Benefits from the assets of the Trust,
the Trustee may rely completely on the information and benefit determinations
provided to it pursuant to Section 4.4(a) and (b) and shall be fully protected
and indemnified by the Company for so doing. Moreover, the Trustee shall be
under no obligation to commence any action seeking judicial, arbitral or
administrative relief in the event that the Company or the Committee does not
comply with its obligations under Sections 4.4(a) and (b) hereof or the
respective Participants or Beneficiaries do not pursue appropriate legal or
other remedies to resolve any dispute.
-14-
(d) The Trustee, if so directed by the Company, may also arrange for
the payment of periodic Plan Benefits directly by an insurance Company under the
terms of a Policy (as, e.g., by the periodic partial surrender of insurance
----
coverage under the Policy to generate cash) or by surrendering the Policy in
exchange for an annuity contract, owned by the Trust, to pay such Plan Benefits.
(e) Upon the death of a Participant to whom payment of periodic
benefits has begun, with the written agreement of the Company, the Trustee shall
have the right, in its sole discretion, to pay the Participant's Beneficiary the
commuted value of any remaining guaranteed periodic benefits under the Plan in a
single cash lump sum.
(f) For purposes of this Agreement, a "Change in Control" means and
shall be deemed to have occurred if:
(1) any person or entity, other than the Company or a Related Party,
is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Security Exchange Act of 1934 ("Exchange Act")), directly or indirectly, of
Voting Securities representing twenty percent (20%) or more of the total voting
power of all the then-outstanding Voting Securities, except that there shall be
excluded from the number of Voting Securities deemed to be beneficially owned by
a person or entity a number of Voting Securities representing not more than ten
percent (10%) of the then-outstanding voting power if such person or entity is
(a) eligible to file a Schedule 13G pursuant to Rule 13d-1(b)(1) under the
Exchange Act with respect to Voting Securities or (b) an underwriter who becomes
the beneficial owner of more than twenty percent (20%) of the then-outstanding
Voting Securities pursuant to a firm commitment underwriting agreement with the
Company; or
(2) the individuals who, as of the effective date of the Plan,
constitute the Board of Directors of the Company together with those who first
become directors subsequent to such date and whose recommendation, election or
nomination for election to the Board was approved by a vote of at least a
majority of the directors then still in office who either were directors as of
the effective date of the Plan or whose recommendation, election or nomination
for
-15-
election was previously so approved (the "Continuing Directors"), cease for
any reason to constitute a majority of the members of the Board; or
(3) the stockholders of the Company approve a merger, consolidation,
recapitalization or reorganization of the Company, reverse split of any class of
Voting Securities, or an acquisition of securities or assets by the Company, or
consummation of any such transaction if stockholder approval is not obtained,
other than (a) any such transaction which would result in at least seventy-five
percent (75%) of the total voting power represented by the voting securities of
the surviving entity outstanding immediately after such transaction being
beneficially owned by at least seventy-five percent (75%) of the holders of
outstanding Voting Securities immediately prior to the transaction, with the
voting power of each such continuing holder relative to other such continuing
holders not substantially altered in the transaction, or (b) any such
transaction which would result in a Related Party beneficially owning more than
fifty percent (50%) of the voting securities of the surviving entity outstanding
immediately after such transaction; or
(4) the stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the
Company of all or substantially all of the Company's assets other than any such
transaction which would result in a Related Party owning or acquiring more than
fifty percent (50%) of the assets owned by the Company immediately prior to the
transaction.
For purposes of this Section 4.4(f), (A) "Related Party" means (i) a majority-
owned subsidiary of the Company, (ii) an employee or group of employees of the
Company or any majority-owned subsidiary of the Company, (iii) a trustee or
other fiduciary holding securities under an employee benefit plan of the Company
or any majority-owned subsidiary of the Company or (iv) a corporation owned
directly or indirectly by the stockholders of the Company in substantially the
same proportion as their ownership of Voting Securities and (B) "Voting
Securities or Security" means any securities of the Company which carry the
right to vote generally in the election of directors.
The Trustee shall be entitled, at any time and from time to time, to
demand written certification from the Secretary of the Company regarding whether
a Change in Control has occurred. Pending the receipt of a response,
satisfactory to the Trustee in form and detail, to such
-16-
demand, the Trustee shall assume that a Change in Control has not occurred;
provided, however, that in the event the Trustee, within the ten day period
following such demand by the Trustee, does not receive a written certification
from the Secretary of the Company, satisfactory to the Trustee in form and
detail, that a Change in Control has not occurred, the Trustee shall assume that
a Change in Control has occurred.
4.5 Payment upon Constructive Receipt. Notwithstanding any other
---------------------------------
provision of this Trust Agreement, if any amounts held in the Trust are found
in a "determination" (within the meaning of Section 1313(a) of the Code) to have
been includable in gross income of a Participant or Beneficiary prior to payment
of such amounts from the Trust, the Trustee shall, as soon as practicable, to
the extent the Company has not made such payment from its own assets, pay to
such Participant or Beneficiary an amount equal to the product of (i) the amount
determined to have been includable in gross income in such determination, and
(ii) the sum of the maximum marginal federal, state and local individual income
tax rates, as determined by the Company, in effect with respect to such
Participant or Beneficiary during the taxable year to which the "determination"
applies, and shall both reduce the Participant's or Beneficiary's future
Benefits accordingly and charge the applicable Participant Account of such
Participant or Beneficiary. The Trustee shall not make any distribution to a
Participant or Beneficiary pursuant to this Section 4.5 unless it has received a
copy of the "determination" described above. The Company shall be primarily
liable for making the payment described in this Section 4.5.
-17-
ARTICLE V: CONTRIBUTIONS AND WITHDRAWALS
-----------------------------------------
5.1 Contributions
-------------
(a) The Company shall deliver to the Trustee such cash, Policies or
other property, which may include letters of credit on the Company's account
issued in favor of the Trust by a national bank (which may include the
Commercial Department of the Trustee), as the Company shall from time to time
determine.
(b) Notwithstanding the foregoing, the Trustee shall not be liable for
any failure by the Company to provide contributions sufficient to pay Benefits
under the Plans in full or to cause required transfers of Qualified Assets to be
made as herein required.
(c) The term "Qualified Assets" when used in this Trust Agreement
shall refer to cash or cash equivalents; letters of credit on the Company's
account issued in favor of the Trust by a national bank (which may include the
Commercial Department of the Trustee); shares of stock and other securities
readily tradeable on an established national exchange; and such other assets
which the Trustee, in its sole discretion, agrees to accept.
(d) (1) If the Trustee is directed to pay benefits under the
Plans from the Trust or the Trustee is due compensation or reimbursement for its
expenses, the Trustee shall for these purposes apply the assets then held in the
Trust in the following order of priority:
a. Cash, cash equivalents, stock and other readily
tradeable securities;
b. Cash available under any letter of credit on the
Company's account which has been issued in favor of
the Trust;
c. Policies, as described in Section 5.1(d)(2).
(2) At any time or from time to time if the Trustee (having applied
assets in the priority stated in Section 5.1(d)(1)) determines that in order to
generate cash to pay current or future Plan Benefits, it is necessary to
surrender any Policies; or the Trustee determines that in order to generate cash
to pay administrative expenses, it is necessary to either borrow from, withdraw
from, encumber in any manner or surrender all or part of any Policy,
-18-
including without limitation partial surrenders or distributions of policy
values; the Trustee shall notify the Company in writing of its intention to so
surrender such Policies, or to so borrow, withdraw, encumber or surrender, as
the case may be, and the amount thereof. Thereupon, the Company shall have the
option within 30 days to contribute Qualified Assets to the Trust in the amount
stated in the notice, and the Trustee shall then refrain from making such
complete surrender, loan, withdrawal, encumbrance or partial surrender until
such subsequent time(s), if any, that the Trustee again determines that it is
necessary to either completely surrender, borrow from, withdraw from, encumber
or partially surrender one or more Policies, whereupon the Trustee shall again
give written notice of its intention to borrow, withdraw, encumber or surrender
and the Company shall again have the option to contribute Qualified Assets, in
the manner set forth above in this Section 5.1(d)(1).
(3) Notwithstanding any other provision in this Trust Agreement, in
the event the Company, upon written notice duly given by the Trustee, does not
exercise its option to contribute Qualified Assets to the Trust in the amount
stated in the Trustee's notice within the time period allowed, the Trustee shall
then be authorized to borrow from, withdraw from, encumber in any manner and/or
surrender all or any of the Policies, in the manner described in 5.1(d)(1), even
if the cash raised therefrom is in excess of the amount stated in such notice.
5.2 Application of Contributions. Contributions by the Company as
----------------------------
provided for herein shall be applied by the Trustee first to the payment of its
fees and expenses and second to the payment of premiums on Policies held by the
Trust.
5.3 Recovery of Trust Assets by the Company.
----------------------------------------
Except as provided in Sections 5.4 and 5.5 and Articles II and XI
hereof, the Trust Fund shall be held for the exclusive purpose of providing
Benefits to Participants and their Beneficiaries and defraying expenses of the
Trust in accordance with the provisions hereof. Accordingly, except as provided
in Sections 5.4 and 5.5 and Articles II and X hereof, no part of the income or
corpus of the Trust Fund shall be recoverable by or for the benefit of the
Company.
-19-
5.4 Transfer of Excess Assets to the Company. The Company may
----------------------------------------
withdraw assets from the Trust, under the conditions set forth below, if:
(1) the Company shall deliver to the Trustee the report of an enrolled
actuary determining the present value of all future benefits payable under the
Plan with respect to current Participants, based upon reasonable assumptions
regarding, inter alia, interest, future compensation increases, and post-
retirement mortality, but assuming no turnover or pre-retirement mortality; and
(2) the assets of the Trust exceed such present value of all
future benefits by more than 25%.
Under such circumstances, the Trustee shall deliver assets of the Trust to the
Company equal to the amount or value requested by the Company, provided,
however, that the remaining assets of each Account in the Trust after such
withdrawal shall be not less in value than 125% of such present value of all
future benefits in each such Account.
5.5 Company as Owner of Assets. All assets of the Trust, including
--------------------------
any allocated to a bookkeeping account for the purpose of paying benefits, are
intended by the Company to satisfy the Company's legal liability under the Plans
in respect of the Participants and their Beneficiaries. If after payment of or
provision for all Benefits due a Participant or Beneficiary, there is any
balance remaining in a bookkeeping account or there are otherwise excess
proceeds from a Policy, such excess shall revert to the Company in accordance
with this Trust Agreement. The Company agrees that all income, deductions, and
credits of each such bookkeeping account belong to it as owner for income tax
purposes and will be included on the Company's income tax returns or any other
required tax returns and will be the sole obligation of and paid by the Company.
-20-
ARTICLE VI: TAXES, EXPENSES AND COMPENSATION
---------------------------------------------
6.1 Taxes on Trust. The Company shall from time to time pay taxes
--------------
of any and all kinds whatsoever which at any time are levied or assessed upon or
become payable in respect of the Trust Fund, the income or any property forming
a part thereof, or any security transaction pertaining thereto. The Trustee
shall, at Company expense, contest the validity of such taxes in any manner
deemed appropriate by the Company or its counsel, but only if the Trustee has
received an indemnity bond or other security satisfactory to it to pay any
expenses of such contest. Alternatively, the Company may itself contest the
validity of any such taxes.
6.2 Withholding Taxes; Employment Taxes. Any amounts paid to a
-----------------------------------
Participant or Beneficiary pursuant to Article IV shall be reduced by the amount
of taxes required by law to be withheld, and the Company shall calculate the
amounts to be withheld and shall direct the Trustee with respect thereto. The
Trustee, in its sole discretion, may either pay such taxes required to be
withheld to the Company, whereupon the Company shall have full responsibility
for the payment of all withholding taxes to the appropriate tax authorities, or
pay such taxes directly for the benefit of the Company; in either such event,
the Company shall timely furnish each Participant or Beneficiary with the
appropriate tax information form evidencing such payment and the amount thereof.
The Company shall be solely responsible for calculating and paying employment
taxes (e.g., employer FICA, FUTA, state unemployment), if any, attributable to
Trust payments to Plan Beneficiaries.
6.3 Expenses and Compensation. The Trustee shall be paid
-------------------------
compensation by the Company (or, in the event the Company fails to make such
payments, from the Trust Fund), in accordance with the Trustee's regular
schedule or fees for trust services and applicable investment management
services for similar trusts, as in effect from time to time, unless the Company
and the Trustee otherwise agree. The Trustee shall be reimbursed by the Company
(or in the event the Company fails to make such reimbursement, from the Trust
Fund), for the Trustee's reasonable expenses of management and administration of
the Trust, including reasonable compensation of counsel and any actuary,
consultant or other agent engaged by the Trustee to assist it in such management
and administration. The Trustee shall submit to the Company a statement for its
compensation and expense reimbursement, setting forth adequate detail to
establish the basis
-21-
therefor. The Trustee shall claim expenses and compensation to be paid from the
Accounts established in the Trust Fund based on the relative value of assets
held in each such Account in the Trust Fund, first from assets not allocated to
separate bookkeeping accounts established under Section 4.3 for the payment of
Benefits; and if such unallocated assets are insufficient, then from assets
which have been allocated under Section 4.3.
-22-
ARTICLE VII: ADMINISTRATION AND RECORDS
----------------------------------------
7.1 Records. The Trustee shall keep or cause to be kept accurate
-------
and detailed accounts of any investments, receipts, disbursements and other
transactions hereunder, and all accounts, books, and records relating thereto
shall be open to inspection and audit at all reasonable times by any person
designated by the Company. All such accounts, books, and records shall be
preserved (in original form, or on microfilm, magnetic tape, or any other
similar process) for such period as the Trustee may determine, but the Trustee
may only destroy such accounts, books, and records after first notifying the
Company in writing of its intention to do so and transferring to the Company any
of such accounts, books, and records requested.
7.2 Settlement of Accounts. Within 60 days after the close of each
----------------------
calendar year, and within 60 days after the removal or resignation of the
Trustee or the termination of the Trust, the Trustee shall file with the Company
a written account setting forth all investments, receipts, disbursements and
other transactions effected by it during the preceding calendar year, or during
such period from the close of the prior calendar year, to the date of such
removal, resignation, or termination, including a description of all investments
and securities purchased and sold, with the cost or net proceeds of such
purchases or sales, and showing all cash, securities, and other property held at
the end of such calendar year or other period. Each account so filed shall be
open to inspection at the office of the Trustee during normal business hours by
the Company and by any person appointed in writing by a majority of the
Participants identified in the last preceding annual accrued benefit information
provided to the Trustee pursuant to Section 4.4(c). For purposes of any such
appointment, each Participant shall have one "vote", irrespective of how many of
the Plans he participates in, and multiple beneficiaries of a single deceased
Participant shall share one vote. (Hereinafter, such person, if any is so
appointed, is referred to as "the Participant's representative".)
If within 90 days after the filing of such account neither the Company
nor the Participants' representative, if any, has filed with the Trustee notice
of any objection to any act or transaction of the Trustee, the initial account
shall become an account stated as between the Trustee, the Company, and all
persons having or claiming to have an interest in the Trust Fund. If
-23-
any objection has been filed, and if the Company or the Participants'
representative who filed such objection is satisfied that it should be
withdrawn, the objecting party shall in writing filed with the Trustee signify
its approval of the account, and it shall become an account stated as between
the Trustee, the Company, and all persons having or claiming to have an interest
in the Trust Fund. If the account is adjusted following an objection thereto,
the Trustee shall file with the Company and make available for inspection by the
Participants' representative the adjusted account, and if within 30 days after
such filing of an adjusted account neither the Company nor the Participants'
representative, if any, has filed with the Trustee notice of any objection to
the transactions as so adjusted, the adjusted account shall become an account
stated as between the Trustee, the Company, and all persons having or claiming
to have an interest in the Trust Fund.
When an account is stated it shall be finally settled, and the Trustee
shall, to the maximum extent permitted by applicable law, be forever released
and discharged from all liability and accountability with respect to the
propriety of its acts and transactions shown in such account.
7.3 Audit. The Trustee shall from time to time permit an
-----
independent certified public accountant selected by the Company to have access
during ordinary business hours to such records as may be necessary to audit the
Trustee's accounts.
7.4 Judicial Settlement. Nothing contained in this Trust Agreement
-------------------
shall be construed as depriving the Trustee or the Company of the right to have
a judicial settlement of the Trustee's account.
7.5 Delivery of Records to Successor. In the event of removal or
--------------------------------
resignation of the Trustee, the Trustee shall deliver to the successor Trustee
all records which shall be required by the successor Trustee to enable it to
carry out the provisions of this Trust Agreement.
7.6 Tax Filings. In addition to any returns required of the Trustee
-----------
by law, the Trustee shall prepare and file such tax reports and other returns as
the Company and the Trustee may from time to time agree.
-24-
ARTICLE VIII: REMOVAL OR RESIGNATION OF THE
TRUSTEE AND DESIGNATION OF SUCCESSOR TRUSTEE
--------------------------------------------
8.1 Resignation.
-----------
(a) The Trustee may resign at any time upon 90 days prior written
notice. If such resignation occurs prior to a Change in Control, the Trustee's
notice thereof shall be to the Company, and the Company shall make a good faith
effort, following receipt of notice of resignation from the Trustee, to find and
to appoint a successor trustee which is a bank or trust Company with assets in
excess of $2 billion and net worth in excess of $100 million, and which shall
adhere to the obligations imposed on the Trustee under the terms of the Trust
Agreement. If such resignation occurs after a Change in Control, the Trustee's
written notice thereof shall be to both the Company and to each Plan Participant
whose home address is identified on the last written data on Plan Participants
provided to the Trustee by the Company prior to the Change in Control. In such
case, a successor Trustee may be appointed pursuant to the written agreement of
at least 25% of the Participants (including Beneficiaries of deceased
Participants) in the Plans. (For purposes of Section 8.1, multiple
Beneficiaries of a single Participant shall count as one vote.)
(b) In the event that the Company or at least 25% of Plan
Participants, as the case may be, shall fail to appoint a successor trustee
within 90 days of the Trustee's notice of resignation, the Trustee shall be
entitled to seek judicial removal and appointment of a successor trustee which
is a bank or trust Company with assets in excess of $2 billion and a net worth
in excess of $100 million.
(c) In any event, the Trustee shall continue to be custodian of the
Trust Fund until the new trustee is in place, and the Trustee shall be entitled
to expenses and fees through the later of the effective date of its resignation
as Trustee or the end of its custodianship of the Trust Fund.
8.2 Removal.
-------
(a) Prior to a Change in Control, the Company may remove any Trustee
with or without cause at any time upon at least 90 days notice in writing to the
Trustee. Such removal of the Trustee by the Company shall not be effective
until the Company has
-25-
appointed, in writing, a successor Trustee, which must be a bank or trust
Company with assets in excess of $2 billion and a net worth in excess of $100
million, and such successor has accepted the appointment in writing.
(b) After a Change in Control shall have occurred, a Trustee may be
removed with or without cause at any time upon at least ninety (90) days notice
in writing to the Trustee pursuant to the written agreement of at least 25% of
the Participants in the Plans as of the date preceding the effective date of a
Change in Control, who shall appoint a successor Trustee satisfying the
requirements set forth in Section 8.2(a). Alternatively, at least 25% of the
Participants in the Plans as of the date preceding the effective date of a
Change in Control may petition the Orphans Court Division, Court of Common
Pleas, Allegheny County, Pennsylvania, for appointment of a successor Trustee.
8.3 Successor Trustee. All of the provisions set forth herein with
-----------------
respect to the Trustee shall relate to each successor trustee with the same
force and effect as if such successor had been originally named as the Trustee
hereunder.
8.4 Transfer of Trust Fund to Successor. Upon the resignation or
-----------------------------------
removal of the Trustee and appointment of a successor, the Trustee shall
promptly transfer and deliver the Trust Fund to such successor, the Trustee's
responsibility hereunder shall be limited to managing the assets in its
possession and transferring such assets to the successor, and settling its final
account. Neither the Trustee nor the successor shall be liable for the acts of
the other.
-26-
ARTICLE IX: ENFORCEMENT OF TRUST
AGREEMENT AND LEGAL PROCEEDINGS
-------------------------------
9.1 The Company shall have the right to enforce any provision of
this Trust Agreement and either the Trustee on behalf of Participants and
Beneficiaries or any Participant (or the Participant's designated beneficiary
or, absent such designation, the legal representative of the Participant's
estate) as a Beneficiary of the Trust shall have the right to enforce any
provision of this Trust Agreement that affects the right, title, and interest of
such Participant (or other person) in the Trust. In any action or proceeding
affecting the Trust the only necessary parties shall be the Company, the
Trustee, and the Participants and, except as otherwise required by applicable
law, no other person shall be entitled to any notice or service of process. Any
judgment entered in such an action or proceeding shall, to the maximum extent
permitted by applicable law, be binding and conclusive on all persons having or
claiming to have any interest in the Trust. Time is of the essence of this
Agreement and in case any provision of this Agreement is enforced by the Trustee
or by any Participant or Beneficiary by law or through an attorney-at-law, or
under advice therefrom, then the Company shall pay all costs of such enforcement
of collection, including reasonable attorney's fees.
-27-
ARTICLE X: TERMINATION
-----------------------
10.1 Terminations. The Trust shall continue until (i) all Benefit
------------
payments required by Article VI or other provisions of this Trust Agreement have
been made or (ii) the Trust Fund contains no assets and retains no claims to
recover assets from the Company pursuant to any provision hereof, whichever
shall occur first. If the Trust terminates pursuant to this Section 10.1, the
Trustee, after its final account has been settled as provided in Section 8.2,
shall distribute to the Company the net balance of any assets of the Trust
remaining after all Benefits and expenses have been paid.
10.2 No Further Liability. Upon making distribution of the Trust
--------------------
Fund pursuant to the preceding paragraphs of this Article X, the Trustee shall
be relieved from all further liability. The powers of the Trustee hereunder
shall continue so long as any assets of the Trust Fund remain in its hands.
-28-
ARTICLE XI: AMENDMENT
----------------------
11.1 Amendment. Except as provided in Section 11.2, this Trust
---------
Agreement may be amended, by agreement of the Company and the Trustee, only to
make nonsubstantive changes which do not have a material adverse effect on the
rights of Participants and Beneficiaries under the Plans.
11.2 Compliance with ERISA, the Code and Other Laws. Notwithstanding
----------------------------------------------
anything in this Article XI to the contrary, this Trust Agreement and the Plan
shall be amended from time to time (without the consent of any Participant) to
maintain the Plan as an unfunded plan maintained primarily for the purpose of
providing deferred compensation for select group of management or highly
compensated employees for purposes of ERISA, the Code, or any other applicable
law; to maintain the Trust as a "grantor trust", and insure that contributions
to the Trust by the Company will not constitute a taxable event and income and
gains of the Trust Fund will not be taxable as income and gains to the Trust or
to Participants under the Plan and that Benefits paid to Participants from the
Trust Fund will be deductible by the Company in the year of payment; and to
effectuate compliance with any other applicable legal requirements.
11.3 Execution of Amendments. The Company and the Trustee shall
-----------------------
execute such amendments of this Trust Agreement as shall be necessary to give
effect to any amendment made pursuant to this Article XI.
-29-
ARTICLE XII: MISCELLANEOUS
---------------------------
12.1 Nonalienation. No amount payable to or in respect of any
-------------
Participant at any time under the Trust shall be subject in any manner to
alienation by anticipation, sale, transfer, assignment, bankruptcy, pledge,
attachment, charge, or encumbrance of any kind, and (i) any attempt to so
alienate, sell, transfer, assign, pledge, attach, charge, or otherwise encumber
any such amount, whether presently or thereafter payable, shall be void, and
(ii) the Trust Fund shall in no manner be liable for or subject to the debts or
liabilities of any Participant. Notwithstanding the foregoing, the Fund shall
at all times remain subject to the claims of creditors of the Company in the
event the Company becomes insolvent as provided in Article II.
12.2 Communications.
--------------
(a) Communications to the Company shall be addressed to the Company at
Consolidated Natural Gas Company, 20th Floor, CNG Tower, 000 Xxxxxxx Xxxxxx,
Xxxxxxxxxx, XX 00000-0000, Attn: Plan Administrator, provided, however, that
upon the Company's written request, such communications shall be sent to such
other address as the Company may specify.
(b) Communications to the Trustee shall be addressed to the Trustee at
Mellon Bank, Attention: Xxxx X. Xxxxxxxx, Vice President, One Mellon Bank
Center,
Room 151-3346, Xxxxxxxxxx, XX 00000-0000, provided, however, that upon the
Trustee's written request, such communications shall be sent to such other
address as the Trustee may specify.
(c) No communication shall be binding on the Trustee until it is
received by the Trustee, and no communication shall be binding on the Company
until it is received by the Company.
12.3 Authority to Act. The Secretary of the Company shall from time
----------------
to time certify to the Trustee the person or persons authorized to act for the
Company and provide the Trustee with such information regarding the Company as
the Trustee may reasonably request. The Trustee may continue to rely on any
such certification until notified to the contrary.
12.4 Authenticity of Instruments. The Trustee shall be fully
---------------------------
protected in acting upon any instrument, certificate, or paper believed by it to
be genuine and to be signed or
-30-
presented by the proper person or persons, and the Trustee shall be under no
duty to make any investigation or inquiry as to any statement contained in any
such writing but may accept the same as conclusive evidence of the truth and
accuracy of the statements therein contained.
12.5 Binding Effect. This Trust Agreement shall be binding upon the
--------------
Company and the Trustee and their respective successors and assigns.
12.6 Inquiry as to Authority. A third party dealing with the Trustee
-----------------------
shall not be required to make inquiry as to the authority of the Trustee to take
any action nor be under any obligation to follow the proper application by the
Trustee of the proceeds of sale of any property sold by the Trustee or to
inquire into the validity or propriety of any act of the Trustee.
12.7 Responsibility for Company Action. The Trustee assumes no
---------------------------------
obligation or responsibility with respect to any action required by this Trust
Agreement on the part of the Company.
12.8 Successor to 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 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 act.
12.9 Laws of Pennsylvania to Govern. This Trust Agreement and the
------------------------------
Trust established hereunder shall be governed by and construed, enforced, and
administered in accordance with the laws of the Commonwealth of Pennsylvania and
the Trustee shall be liable to account only in the courts of that Commonwealth.
12.10 Reports. The Trustee shall not be required to file any annual
-------
or other returns or reports to any court, or to give any bond, or to secure any
order or consent of any court, to carry out any of the powers conferred on the
Trustee or to make any other reports to any court.
12.11 Counterparts. This Trust Agreement may be executed in any
------------
number of counterparts, each of which shall be deemed to be the original
although the others shall not be produced.
-31-
12.12 Participant to Include Beneficiary. The term Participant when
----------------------------------
used herein shall be deemed to include the Beneficiary of any Participant who
becomes entitled to receive or is receiving Benefits under any of the Plans on
account of the death of such Participant.
IN WITNESS WHEREOF, this Trust Agreement has been duly executed by the
parties hereto as of the day and year first above written.
CONSOLIDATED NATURAL GAS COMPANY
By:________________________________
X. X. Xxxxxxx
Vice Chairman and Chief
Financial Officer
(Corporate Seal)
Attest:______________________________
Secretary
MELLON BANK, TRUSTEE
By:_________________________________
Vice President
(Corporate Seal)
Attest:_____________________________
Secretary
-32-
Schedule A
to
Trust Agreement between
Consolidated Natural Gas Company
and
Mellon Bank
Contents:
--------
1. Consolidated Natural Gas Company Rabbi Trust Administrative Guidelines
2. Information on Accrued Benefits as of December 31, 1994
3. Information regarding Accounts in Trust:
Assets in Account A shall be available to pay benefits solely to
Participants who accrued benefits payable under the Executive
Incentive Deferral Plan pursuant to their employment by CNG Producing
Company or CNG Energy Services Company.
Assets in Account B shall be available to pay benefits solely to
Participants who accrued benefits payable under the Executive
Incentive Deferral Plan or the Non-Employee Directors Deferred
Compensation Plan pursuant to their employment by Consolidated Natural
Gas Company or any subsidiary other than CNG Producing Company or CNG
Energy Services Company.
Additional Accounts may be established by the Company in the future.
