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Exhibit 10.3
THE XXXXXXXX & XXXXXX CORPORATION
AMENDED AND RESTATED
DEFERRED COMPENSATION TRUST II
as of August 21, 2003
This Deferred Compensation Trust II by and between Xxxxxxxx & Ilsley
Corporation ("Company") and Xxxxxxxx & Xxxxxx Trust Company ("Trustee") was
originally effective as of the 1st day of January, 1997 and was amended and
restated effective October 12, 2000 and August 21, 2003.
WHEREAS, Company, on its behalf and on behalf of certain of its
affiliates and other related entities (referred to individually as a "Plan
Sponsor" and collectively as the "Plan Sponsors"), has adopted a
nonqualified deferred compensation plan for a selected group of its highly
compensated employees known as the Xxxxxxxx & Ilsley Corporation Executive
Deferred Compensation Plan ("Plan") and the Amended and Restated Xxxxxxxx
& Xxxxxx Corporation Supplementary Retirement Benefits Plan (the "SERP")
(the Plan and the SERP are jointly referred to as the "Plans");
WHEREAS, the Plan Sponsors have incurred or expect to incur liability
under the terms of such Plans with respect to their respective employees
participating in such Plans;
WHEREAS, the Plan Sponsors wish to establish a trust (hereinafter
called "Trust") and each Plan Sponsor wishes to contribute, to its own
account (the "Account") within the Trust, assets that shall be held in its
Account, subject to the claims of such Plan Sponsor's creditors in the event
of its Insolvency, and the claims of the Company's creditors in the event
of its Insolvency, as herein defined, until paid to Plan participants and
their beneficiaries from their respective subaccounts (the "Subaccounts")
within such Plan Sponsor's Account, in accordance with the terms of the
Plans;
WHEREAS, it is the intention of the parties that this Trust shall
constitute an unfunded arrangement and shall not affect the status of the
Plans as unfunded plans maintained for the purpose of providing deferred
compensation for a select group of management or highly compensated
employees for purposes of Title I of ERISA;
WHEREAS, it is the intention of the Company, and each Plan Sponsor,
to make contributions to the Subaccounts under the Trust to provide the Plan
Sponsors with a source of funds to assist them in the meeting of their
liabilities under the Plans.
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NOW, THEREFORE, the parties do hereby establish the Trust and agree
that the Trust shall be comprised, held and disposed of as follows:
Section 1. Establishment of Trust.
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(a) Each Plan Sponsor has deposited assets with Trustee
into its Account under the Trust, which amount, in the aggregate,
shall become the principal of the Trust to be held, administered and
disposed of by Trustee as provided in this Trust Agreement.
(b) The Trust hereby established shall be irrevocable.
(c) The Trust is intended to be a grantor trust, of which
each Plan Sponsor is a grantor, within the meaning of subpart E, part
I, subchapter J, chapter 1, subtitle A of the Internal Revenue Code
of 1986, as amended, and shall be construed accordingly.
(d) The principal of the Trust, and any earnings thereon
shall be held separate and apart from other funds of each Plan
Sponsor and shall be used exclusively for the uses and purposes of
Plan participants and their beneficiaries and general creditors of
each Plan Sponsor and the Company as herein set forth. Plan
participants and their beneficiaries shall have no preferred claim
on, or any beneficial ownership interest in, any assets of the Trust.
Any rights created under the Plans and this Trust Agreement shall be
mere unsecured contractual rights of Plan participants and their
beneficiaries against their respective Plan Sponsors. Any assets
held in a Plan Sponsor's account under the Trust will be subject to
the claims of such Plan Sponsor's general creditors under federal and
state law in the event of such Plan Sponsor's Insolvency, as defined
in Section 3(a) herein, and will also be subject to the claims of the
Company's general creditors under federal and state law in the event
of the Company's Insolvency.
(e) Each Plan Sponsor shall, from time to time, but no less
frequently than annually, make additional deposits of cash or other
property in trust with Trustee to augment the principal to be held,
administered and disposed of by Trustee as provided in this Trust
Agreement so that the funds in each Subaccount are sufficient to meet
such Plan Sponsor's obligation to each participant in the Plans from
time to time.
(f) Each Plan Sponsor, other than the Company, shall join
in and adopt this Trust by means of a joinder agreement (the "Joinder
Agreement"), substantially in the form of Exhibit A hereto, and in so
doing, shall appoint the Company as its agent for purposes of this
Trust, and shall agree that (i) it shall be bound by the Company's
decisions, actions, and directions under this Trust, (ii) the Company
has the sole authority to enforce this Trust on behalf of such Plan
Sponsor, and (iii) the Trustee shall be fully protected in relying
upon such decisions, actions, and directions, and the Trustee shall
in no event be required to give notice to, or otherwise deal with,
such Plan Sponsor except by dealing with the Company as agent of such
Plan Sponsor.
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Section 2. Payments to Plan Participants and Their Beneficiaries.
__________________________________________________________________
(a) Company, on behalf of itself and the other Plan
Sponsors, shall deliver to Trustee a schedule (the "Payment
Schedule") that indicates the amounts payable in respect of each Plan
participant (and his or her beneficiaries), that provides a formula
or other instructions acceptable to Trustee for determining the
amounts so payable, the form in which such amount is to be paid (as
provided for or available under the Plan and the time of commencement
for payment of such amounts. Except as otherwise provided herein,
Trustee shall make payments to the Plan participants and their
beneficiaries in accordance with such Payment Schedule. The Trustee
shall make provision for the reporting and withholding of any
federal, state or local taxes that may be required to be withheld
with respect to the payment of benefits pursuant to the terms of the
Plans and shall pay amounts withheld to the appropriate taxing
authorities or determine that such amounts have been reported,
withheld and paid by the applicable Plan Sponsor.
(b) The entitlement of a Plan participant or his or her
beneficiaries to benefits under the Plans shall be determined by
Company or such party as it shall designate under the Plans, and any
claim for such benefits shall be considered and reviewed under the
procedures set out in the Plans.
(c) Each Plan Sponsor may make payment of benefits directly
to such Plan Sponsor's Plan participants or their beneficiaries as
they become due under the terms of the Plans. Company shall notify
Trustee of its or any other Plan Sponsor's decision to make payment
of benefits directly prior to the time amounts are payable to
participants or their beneficiaries. In addition, if the principal
of the Trust, and any earnings thereon, are not sufficient to make
payments of benefits in accordance with the terms of the Plans,
Company or other Plan Sponsor, whichever applies, shall make the
balance of each such payment as it falls due. Trustee shall notify
Company where principal and earnings are not sufficient.
Section 3. Trustee Responsibility Regarding Payments To Trust
______________________________________________________________
Beneficiary When A Plan Sponsor is Insolvent.
_____________________________________________
(a) When a Plan Sponsor or the Company is Insolvent,
Trustee shall cease payment of benefits to such Plan Sponsor's Plan
participants and their beneficiaries from their respective
Subaccounts within such Plan Sponsor's Account. A Plan Sponsor or
the Company shall be considered "Insolvent" for purposes of this
Trust Agreement if (i) the Plan Sponsor or the Company is unable to
pay its debts as they become due, (ii) the Plan Sponsor or the
Company is subject to a pending proceeding as a debtor under the
United States Bankruptcy Code, or (iii) the Plan Sponsor or the
Company is determined to be insolvent by any state or federal
regulatory authority.
(b) At all times during the continuance of this Trust, as
provided in Section l(d) hereof, the principal and income held in
each Plan Sponsor's Account within the Trust shall be subject to
claims of the general creditors of such Plan Sponsor and the Company
under federal and state law as set forth below.
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(1) The Board of Directors and the Chief
Executive Officer of Company and each other Plan Sponsor
shall have the duty to inform Trustee in writing of its, or
in the case of the Company, its or any other Plan Sponsor's
Insolvency. If a person claiming to be a creditor of any
Plan Sponsor alleges in writing to Trustee that such Plan
Sponsor has become Insolvent, Trustee shall determine
whether such Plan Sponsor is Insolvent and, pending such
determination, Trustee shall discontinue payment of benefits
to such Plan Sponsor's Plan participants or their
beneficiaries or their beneficiaries from their respective
Subaccounts within such Plan Sponsor's Account. In the case
of the claimed insolvency of the Company, Trustee shall
discontinue payment of benefits to all Plan participants or
their beneficiaries from their respective Subaccounts.
(2) Unless Trustee has actual knowledge of any
Plan Sponsor's Insolvency, or has received notice from
Company, another Plan Sponsor, or a person claiming to be a
creditor alleging that Company or any other Plan Sponsor is
Insolvent, Trustee shall have no duty to inquire whether any
Plan Sponsor is Insolvent. Trustee may in all events rely
on such evidence concerning any Plan Sponsor's solvency as
may be furnished to Trustee and that provides Trustee with
a reasonable basis for making a determination concerning any
Plan Sponsor's solvency.
(3) If at any time Trustee has determined that
any Plan Sponsor is Insolvent, Trustee shall discontinue
payments to such Plan Sponsor's Plan participants or their
beneficiaries from their respective Subaccounts within such
Plan Sponsor's Account and shall hold the assets of the
Trust for the benefit of such Plan Sponsor's general
creditors. If at any time Trustee has determined that the
Company is Insolvent, Trustee shall discontinue payments to
all Plan participants or their beneficiaries from their
respective Subaccounts and shall hold the assets of the
Trust for the benefit of the Company's general creditors.
Nothing in this Trust Agreement shall in any way diminish
any rights of Plan participants or their beneficiaries to
pursue their rights as general creditors of their Plan
Sponsor with respect to benefits due under the Plans or
otherwise.
(4) Trustee shall resume the payment of benefits
to such Plan Sponsor's Plan participants or their
beneficiaries in accordance with Section 2 of this Trust
Agreement only after Trustee has determined that the Company
or the applicable Plan Sponsor is not Insolvent (or is no
longer Insolvent).
(c) Provided that there are sufficient assets in the Plan
Sponsor's Account under the Trust, if Trustee discontinues the
payment of benefits from such Plan Sponsor's Account pursuant to
Section 3(b) hereof and subsequently resumes such payments, the first
payment following such discontinuance shall include the aggregate
amount of all payments due to such Plan Sponsor's Plan participants
or their beneficiaries under the terms of the Plan for the period of
such discontinuance, less the aggregate amount of any payments made
to such Plan Sponsor's Plan participants or their beneficiaries by
such Plan Sponsor or the Company in lieu of the payments provided for
hereunder during any such period of discontinuance.
Section 4. Payments to the Plan Sponsors.
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Except as provided in Section 3 hereof, no Plan Sponsor shall have no
right or power to direct Trustee to divert to itself or others any of the
Trust assets before all payment of benefits have been made to Plan
participants and their beneficiaries pursuant to the terms of the Plan.
Upon payment in full of amounts owed to any participant hereunder, any
remaining amount shall revert to the Company and upon termination of the
Trust, all remaining amounts shall revert to the Company.
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Section 5. Investment Authority.
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(a) Trustee may invest in securities (including stock or
rights to acquire stock) or obligations issued by Company. All
rights associated with assets of the Trust shall be exercised by
Trustee at the direction of the Company, the Plan Sponsors or the
person designated thereby (a "designee"), and shall in no event be
exercisable by or rest with Plan Participants.
(b) In addition to the general investment powers set forth
above in this Section 5, the following provisions shall apply:
(i) Investment Guidelines and Directives. The
Trustee shall manage, acquire, or dispose of the assets of
the Trust in accordance with this Agreement and the
directions of the Plan Sponsors or their designee. To the
extent permitted by law, the Trustee shall not be liable for
any investment made pursuant to the Plan Sponsors' or their
designees' direction.
(ii) Trustee Powers. The Trustee shall have the
following powers, rights and duties subject to Section 8 and
the other provisions of this Trust Agreement:
(A) To receive and hold all
contributions paid to it by the Plan Sponsors;
(B) To effectuate the written investment
instructions given by the Plan Sponsors or their
designee without regard to any law now or hereafter
in force limiting investments of fiduciaries;
(C) To retain in separate Accounts for
each Plan Sponsor within the trust for investment,
any property deposited by the Plan Sponsors
hereunder, allocated among Subaccounts in
accordance with Section 7 hereof;
(D) To have the authority to invest and
reinvest assets of the Trust in shares of common or
preferred stock (including those of the Company),
bonds, notes, debentures, short-term securities,
mutual funds (including any such fund from which
the Trustee or any affiliate thereof receives an
investment management fee or any other fee), common
trust funds, and other property, real or personal,
of any kind; to purchase and sell "put" and "call"
options on publicly traded securities; and to
acquire, hold, manage, operate, sell, contract to
sell, grant options with respect to, convey,
exchange, transfer, abandon, lease, manage, and
otherwise deal with respect to assets of the Trust;
(E) To acquire, hold or dispose of
insurance or annuity contracts as directed by the
Plan Sponsors or their designees;
(F) To borrow from anyone such amount or
amounts of money necessary to carry out the purpose
of this Trust and for that purpose to mortgage or
pledge all or any part of the Trust;
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(G) To retain in the Trust for
investment or pending distributions, any portion of
the Trust in cash deemed appropriate by the
Trustee;
(H) To establish accounts in any
affiliate of the Trustee and in such other banks
and financial institutions as the Trustee deems
appropriate to carry out the purposes of the Trust;
(I) To deposit securities with a
clearing corporation as defined in Article Eight of
the Uniform Commercial Code; to hold the
certificates representing securities, including
those in bearer form, in bulk form with and to
merge such certificates into certificates of the
same class of the same issuer which constitute
assets of other accounts or owners, without
certification as to the ownership attached; and to
utilize a book-entry system for the transfer or
pledge of securities held by the Trustee or by a
clearing corporation, provided that the records of
the Trustee shall indicate the actual ownership of
the securities and other property of the Trust
Fund.
(J) To participate in and use the
Federal book-entry account system, a service
provided by the Federal Reserve Bank for its member
banks for deposit of Treasury securities.
(K) To hold securities or property in
the name of the Trustee or its nominee or nominees
or in such other form as it determines best with or
without disclosing the Trust relationship,
providing the records of the Trust shall indicate
the actual ownership of such securities or other
property.
Section 6. Disposition of Income.
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During the term of this Trust, all income received by a Plan Sponsor's
Account under the Trust, net of expenses and taxes, shall be accumulated and
reinvested in such Account.
Section 7. Accounting by Trustee.
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Trustee shall establish and maintain within the Trust a separate
Account for each Plan Sponsor, which shall at all times reflect such Plan
Sponsor's equitable share in the Trust fund, and shall hold, manage,
administer, value, make purchases and sales for, distribute, account for,
and otherwise deal with, each such Account separately.
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Trustee shall keep accurate and detailed records of all investments,
receipts, disbursements, and all other transactions required to be made with
respect to the Trust as a whole and each Plan Sponsor's Account within the
Trust, including such specific records as shall be agreed upon in writing
between Company and Trustee. Within 30 days following the close of each
calendar year and within 30 days after the removal or resignation of
Trustee, Trustee shall deliver to Company a written account of its
administration of the Trust as a whole and each Plan Sponsor's Account
within the Trust during such year or during the period from the close of the
last preceding year to the date of such removal or resignation, setting
forth all investments, receipts, disbursements and other transactions
effected by it, including a description of all securities and investments
purchased and sold with the cost or net proceeds of such purchases or sales
(accrued interest paid or receivable being shown separately), and showing
all cash, securities and other property held in the Trust or such Account
at the end of such year or as of the date of such removal or resignation,
as the case may be.
In addition, the Trustee shall establish and maintain Subaccounts for
Plan participants, within their Plan Sponsor's Account under the Trust, in
a manner that is consistent with the requirements of the Plans, and that
facilitates their investment instructions and benefit payments under the
Plan.
Section 8. Responsibility of Trustee.
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(a) Trustee shall act with the care, skill, prudence and
diligence under the circumstances then prevailing that a prudent
person acting in like capacity and familiar with such matters would
use in the conduct of an enterprise of a like character and with like
aims, provided, however, that Trustee shall incur no liability to any
person for any action taken pursuant to a direction, request or
approval given by any Plan Sponsor which is contemplated by, and in
conformity with, the terms of the Plan or this Trust and is given in
writing by any Plan Sponsor. In the event of a dispute between any
Plan Sponsor and a party, Trustee may apply to a court of competent
jurisdiction to resolve the dispute.
(b) If Trustee undertakes or defends any litigation arising
in connection with this Trust, the Plan Sponsors agree to indemnify
Trustee against Trustee's costs, expenses and liabilities (including,
without limitation, attorneys' fees and expenses) relating thereto
and to be primarily liable for such payments. If the Plan Sponsors
do not pay such costs, expenses and liabilities in a reasonably
timely manner, Trustee may obtain payment from the Trust.
(c) Trustee may consult with legal counsel (who may also
be counsel for a Plan Sponsor generally) with respect to any of its
duties or obligations hereunder.
(d) Trustee may hire agents, accountants, actuaries,
investment advisors, financial consultants or other professionals to
assist it in performing any of its duties or obligations hereunder.
(e) Trustee shall have, without exclusion, all powers
conferred on Trustees by applicable law, unless expressly provided
otherwise herein, provided, however, that if an insurance policy is
held as an asset of the Trust, Trustee shall have no power to name a
beneficiary of the policy other than the Trust, to assign the policy
(as distinct from conversion of the policy to a different form) other
than to a successor Trustee or to loan to any person the proceeds of
any borrowing against such policy.
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(f) Notwithstanding any powers granted to Trustee pursuant
to this Trust Agreement or to applicable law, Trustee shall not have
any power that could give this trust the objective of carrying on a
business and dividing the gains therefrom, within the meaning of
section 301.7701-2 of the Procedures and Administrative Regulations
promulgated pursuant to the Internal Revenue Code.
Section 9. Compensation and Expenses of Trustee.
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Company shall pay all administrative and Trustee's fees and expenses.
If not so paid, the fees and expenses shall be paid from the Trust.
Section 10. Resignation and Removal of Trustee.
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(a) Trustee may resign at any time by written notice to
Company, which shall be effective 60 days after receipt of such
notice unless Company and Trustee agree otherwise.
(b) Trustee may be removed by Company on 30 days notice or
upon shorter notice accepted by Trustee.
(c) Upon resignation or removal of Trustee and appointment
of a successor Trustee, all assets shall subsequently be transferred
to the successor Trustee. The transfer shall be completed within 30
days after receipt of notice of resignation, removal or transfer,
unless Company extends the time limit.
(d) If Trustee resigns or is removed, a successor shall be
appointed, in accordance with Section 11 hereof, by the effective
date of resignation or removal under paragraphs (a) or (b) of this
section. If no such appointment has been made, Trustee may apply to
a court of competent jurisdiction for appointment of a successor or
for instructions. All expenses of Trustee in connection with the
proceeding shall be allowed as administrative expenses of the Trust.
Section 11. Appointment of Successor.
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(a) If Trustee resigns or is removed in accordance with
Section 10(a) or (b)hereof, Company may appoint any third party, such
as a bank trust department or other party that may granted corporate
trustee powers under state law, as a successor to replace Trustee
upon resignation or removal. The appointment shall be effective when
accepted in writing by the new Trustee, who shall have all of the
rights and powers of the former Trustee, including ownership rights
in the Trust assets. The former Trustee shall execute any instrument
necessary or reasonably requested by Company or the successor Trustee
to evidence the transfer.
(b) The successor Trustee need not examine the records and
acts of any prior Trustee and may retain or dispose of existing Trust
assets, subject to Sections 7 and 8 hereof. The successor Trustee
shall not be responsible for and Company shall indemnify and defend
the successor Trustee from any claim or liability resulting from any
action or inaction of any prior Trustee or from any other past event,
or any condition existing at the time it becomes successor Trustee.
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Section 12. Amendment or Termination.
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(a) This Trust Agreement may be amended by a written
instrument executed by Trustee and Company. Notwithstanding the
foregoing, no such amendment shall conflict with the terms of the
Plans or shall make the Trust revocable after it has become
irrevocable in accordance with Section 1(b) hereof.
(b) The Trust shall not terminate until the date on which
Plan participants and their beneficiaries are no longer entitled to
benefits pursuant to the terms of the Plans. Upon termination of the
Trust any assets remaining in the Trust shall be returned to Company.
(c) Upon written approval of participants or beneficiaries
entitled to payment of benefits pursuant to the terms of the Plans,
Company may terminate this Trust prior to the time all benefits
payments under the Plan have been made. All assets in the Trust at
termination shall be returned to Company.
Section 13. Miscellaneous.
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(a) Any provision of this Trust Agreement prohibited by law
shall be ineffective to the extent of any such prohibition, without
invalidating the remaining provisions hereof.
(b) Benefits payable to Plan participants and their
beneficiaries under this Trust Agreement may not be anticipated,
assigned (either at law or in equity), alienated, pledged, encumbered
or subjected to attachment, garnishment, levy, execution or other
legal or equitable process.
(c) This Trust Agreement shall be governed by and construed
in accordance with the laws of the State of Wisconsin, without
application of its principles of conflicts of laws.
Section 14. Effective Date.
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The effective date of this Trust Agreement shall be January 1, 1997.
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IN WITNESS WHEREOF, the Company and Trustee have caused this Agreement
to be duly executed on the date first above written.
XXXXXXXX & XXXXXX CORPORATION
By: /s/ Xxxx X. Xxxxxx
_______________________________
Title: Senior Vice President
Attest: /s/ Xxxxxxx X. Xxxxxxxx
_______________________________
Title: Secretary
XXXXXXXX & ILSLEY TRUST COMPANY
By: /s/ Xxxxxxx X Xxxxx
_______________________________
Title: Vice President and Manager
of Commercial Trust
Attest: /s/ Xxxxxx X. Xxxxxx
_______________________________
Title: Vice President and
Relationship Manager
MW80460_4.DOC
