Exhibit 10(k)
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X.X. XXXXXX COMPANY
EXECUTIVE BENEFIT TRUST
THIS AGREEMENT is made by and between X.X. Xxxxxx Company (the "Company") and
First Trust National Association.
W I T N E S S E T H:
WHEREAS, the Company has established a plan for executive and key management
employees and may establish one or more other such plans, each of which is
listed on Exhibit A to this Agreement and is referred to in this Agreement as
the "Plan" or collectively as the "Plans"; and
WHEREAS, The Company desires to establish a trust for the purpose of
implementing the provisions of the Plan;
NOW, THEREFORE, In order to establish a trust under the Plans and in
consideration of the mutual undertakings of the parties, it is agreed as
follows:
ARTICLE I
RULES OF CONSTRUCTION
1.1 General Definitions. Unless the context otherwise indicates, the terms
used in this agreement are given the meaning ascribed to them by the Plan with
respect to which they are being applied.
1.2 Grantor Trust. The Trust is intended to be a grantor trust described in
section 671 of the Internal Revenue Code, and shall be construed accordingly.
1.3 "Change in Control" shall mean any of the following events:
(a) a determination made by the Board of Directors of the Company, in its
sole discretion, that a change in control of the Company has occurred;
(b) the acquisition, by any person (as such term is used in Sections 13(d)
and 14(d) (2) of the Securities and Exchange Act of 1934) or any group of
persons acting in concert, of beneficial ownership, direct or indirect, of
securities of the Company representing more than fifteen percent of the
combined voting power of the Company's then outstanding securities;
(c) the merger or consolidation of the Company in which it is not the
surviving corporation with, or the sale of all or substantially all of the
assets of the Company to, any person or entity or group of associated
persons or entities not
affiliated (within the meaning of the Securities Act of 1933) with the
Company as of the date of this Agreement; or
(d) a change in the composition of the Board of Directors of the Company at
any time during any consecutive twelve month period such that the
"Continuity Directors" cease for any reason to constitute at least a
majority of the Board of Directors. For purposes of this clause (d),
"Continuity Directors" means those members of the Board of Directors of the
Company who either:
(i) were Directors at the beginning of such consecutive twelve (12) month
period; or
(ii) were elected by, or on the nomination or recommendation of, at least a
majority of the Board of Directors of the Company.
1.4 "Administrator" shall mean the Plan Administrator designated by the Plan
or, if not designated by the Plan, the Chief Executive Officer of the
Company or the person to whom the Chief Executive Officer has delegated the
Administrator's duties under the Plan.
1.5 "Trustee" shall mean the banking organization that has executed this
Agreement, or its successor in trust, who is at the relevant time acting as
the trustee under this Agreement.
ARTICLE II
APPLICATION OF FUNDS
2.1 Segregation of Trust Funds. The Trustee agrees to hold and manage all
contributions received from the Company or any other source and the income and
increment of such contributions. The trust estate shall be held separate and
apart from other funds of the Company and shall be used exclusively for the
purposes set forth in this Agreement.
2.2 Payment of Benefits. Subject to the provisions of Sections 2.3 and 3.1,
the Trustee shall distribute the trust fund to participants in accordance with
the terms of the Plan. If the Administrator fails to instruct the Trustee to
make a distribution from the Trust fund within thirty days after the occurrence
of an event entitling a participant to receive a distribution, the Trustee shall
be entitled to rely on instructions from the participant if the participant
submits proof that such an event has occurred with respect to the participant.
If the assets of the Trust are not sufficient to make payments of benefits under
the Plan to participants and their beneficiaries, the Company shall make the
balance of each such payment as it becomes due.
2.3 Reversion of Excess Assets. If, upon the Company's request, the Trustee
determines, on the basis of reasonable actuarial assumptions chosen by the
Trustee, that a
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portion of the Trust's assets or future earnings allocated to an account for a
Plan will not be required to pay benefits to participants and their
beneficiaries under the terms of the Plan in effect at the time of the
determination, all or any part of such portion of assets or future Trust earning
shall be returned to the Company upon the direction of the Company; provided
that no part of any assets or future Trust earning shall be paid to the Company
after the occurrence of a change in control except as provided in Section 5.2 or
10.3.
ARTICLE III
INSOLVENCY
3.1 Creditors' Claims. At all times during the term of this Trust, the
principal and income of the Trust shall be subject to the claims of general
creditors of the Company, and at any time the Trustee has actual knowledge, or
has determined, that the Company is insolvent, the Trustee shall deliver any
undistributed principal and income in the Trust to satisfy such claims as a
court of competent jurisdiction or a person appointed by the court may direct.
The Board of Directors and the Chief Executive Officer of the Company shall have
the duty to inform the Trustee of the Company's insolvency. If the Company or a
person claiming to be creditor of the Company alleges in writing to the Trustee
that the Company has become insolvent, the Trustee shall independently
determine, within thirty days after receipt of such notice, whether the Company
is insolvent and, pending such determination, the Trustee shall discontinue
payments of benefits under the Plan, shall hold the Trustee assets for the
benefit of the Company's general creditors, and shall resume payments of
benefits under the terms of the Plans only after the Trustee has determined that
the Company is not insolvent or is no longer insolvent, if the Trustee initially
determined the Company to be insolvent). Unless the Trustee has actual
knowledge of the Company's insolvency, the Trustee shall have no duty to inquire
whether the Company is insolvent. The Trustee may in all cases rely on such
evidence concerning the Company's solvency as may be furnished to the Trustee
which will give the Trustee a reasonable basis for making a determination
concerning the Company's solvency. Nothing in this Trust Agreement shall in any
way diminish any rights of a participant to pursue his rights as a general
creditor of the Company with respect to the benefits to which he is entitled
under the Plan, but the Trustee shall not, except upon direction of a court of
competent jurisdiction or a person appointed by the court, pay to any
participant any amounts representing the participant's priority claim for wages
or employee benefits.
3.2 Restoration of Benefits. If the Trustee discontinues payments of benefits
from the Trust pursuant to the provisions of Section 3.1, and subsequently
resumes such payments, the first payment following such discontinuance shall
include the aggregate amount of all payments that would have been made to the
participant during the period of such discontinuance, less the aggregate amount
of payments made to the participant by the Company in lieu of the payments that
would have been provided from this Trust during any such period of
discontinuance.
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3.3 "Insolvency." The Company shall be considered "insolvent" for purposes of
this Trust Agreement if (a) the Company is unable to pay its debts as they
mature, or (b) the Company is subject to a pending proceeding as a debtor under
the Bankruptcy Code.
ARTICLE IV
CHANGE IN CONTROL
4.1 Administration after Change in Control. Upon and after the Trustee
receives notice of the occurrence of a Change in Control, the Trustee shall
administer the Trust as follows:
(a) The Trustee shall segregate in a separate share of the Trust the assets
of the Trust held to provide benefits for all participants who were
participants in the Plans immediately prior to the Change in Control,
including any contributions received for such participants following the
Change in Control. A separate share of the Trust shall be created for
assets held to provide benefits for persons who become participants in the
Plans after the Change in Control. The assets of the separate shares shall
not be commingled, and in no event shall assets of such a share be used to
provide benefits under another share unless all benefits to participants
under the first share have been paid.
(b) The provisions of Section 3.1, relating to payments to general
creditors of the Company in the event of insolvency, shall not apply to the
separate share of the Trust that includes assets held prior to the Change
in Control until each other separate share has been exhausted by such
payments.
4.2 Notice. The Trustee shall be deemed to have received notice of the
occurrence of a Change in Control only upon actual delivery to the Trustee of a
written notice of such occurrence signed by an officer of the Company, a member
of the Board of Directors of the Company or a participant in the Plan. If,
following its receipt of such a notice, the Trustee determines that no Change in
Control has in fact occurred, it shall continue to administer the Trust as if
such notice had not been received.
ARTICLE V
ERISA TERMINATION
5.1 Loss of ERISA Exemptions. If the existence of the Trustee is finally
determined by a competent authority to constitute a fund that will cause any
Plan to lose its exemptions under Title I of ERISA as an unfunded plan
maintained for the purpose of providing deferred compensation for a select group
of management or highly compensated employees, the Trust shall terminate. If
such termination occurs prior to the date on which a statement regarding
ownership of five percent or more of the Company required by Section 13(d) or
14(d) of the Securities and Exchange Commission, or if such termination occurs
more than two years after such statement is filed and no Change in control has
occurred, the Trustee shall (a) transfer the assets of the Trust to the trustee
of
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a new trust established by the Company that, in the opinion of counsel selected
by the Trustee, will not constitute such a fund and is in other respects similar
to this Trust, or (b) if no such other trust is in existence within ninety days
after the termination, distribute to each participant the present value of his
benefit under each Plan. If such termination occurs less than two year after
such statement has been filed or after a Change in Control has occurred, the
Trustee shall distribute to each participant the present value of his benefits
under each Plan. For purposes of the foregoing, a final determination of a
competent authority means a court order or an opinion of the Department of Labor
which cannot, or which the Company determines will not, be appealed.
5.2 Allocation upon Termination. Upon any distribution to participants under
Section 5.1, the trustee shall make distributions with respect to benefits under
any Plan from the Account for such Plan to the extent of the balance of such
account. If such Account is insufficient to pay such benefits in full, the
deficiency shall be allocated among the participants in proportion to the
present value of the accrued benefit of each under the Plan. If the balance of
the Account exceeds the amount of benefits payable under the Plan, the excess
shall first be allocated to participants in proportion to the aggregate amount
of deficiencies allocated to each with respect to other Plans, and second, if
the assets of the Trust exceed the value of all accrued benefits under the
Plans, the excess shall be returned to the Company.
ARTICLE VI
ACCOUNTS
6.1 Separate Plan Accounts. The Trustee shall establish a separate account
within the Trust to evidence contributions made pursuant to each separate plan
and the earnings and losses attributable to such contributions. The Company
shall instruct the Trustee as to the account or accounts to which each
contribution is to be allocated. Each account shall reflect an undivided
interest in the assets of the Trust, except that if an insurance policy is
acquired under a specific Plan, such policy shall be credited to the account for
such Plan. A single policy may be allocated in specified portions to accounts
for two or more Plans in accordance with the direction of the Company. Earnings
and losses of the Trust, except those attributable to an insurance policy (or a
portion of a policy) allocated to a specific account, shall be apportioned among
the accounts in proportion to their balances, exclusive of insurance policies,
as of the first day of an accounting period. All distributions in satisfaction
of benefits under a Plan, including those payable to a participant or
beneficiary as a general creditor of the Company, shall be charged against the
account of such Plan. Expenses of the Trust and any distributions other than
Plan benefits to the Company's general creditors shall be charged against the
accounts in proportion to their balances, including the value of any insurance
polices. Insurance policies shall be valued at their surrender value as of the
valuation date.
6.2 Participant Accounts. The Administrator shall maintain accounts for each
participant (and for the beneficiary of each deceased participant) as provided
in the Plan. As of each valuation date under the Plan, the trustee shall adjust
such accounts for
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imputed gains and losses in the manner provided in the Plan or, if the Plan does
not otherwise provide, in a reasonable manner determined by the Trustee.
ARTICLE VIII
POWERS AND DUTIES OF TRUSTEE
7.1 Investments. The Trustee shall invest the assets of the Trust in the
manner directed by the Company. The Company may contribute to the Trust, or
direct the Trustee to obtain, one or more policies of insurance on the life of
the participant, former participant, other employee or against the disability of
any participant and to allocate such policy to a Plan, or to allocate specified
interests in such policy to two or more Plans. The Trustee shall have no
discretion with respect to the acquisition, disposition or allocation of any
such policy and shall act only at the direction of the Company. To the extent a
policy is acquired with funds allocated to a separate account for a Plan, an
interest in the policy proportionate to the funds provided from such account for
such acquisition shall be allocated to such account. The Trustee shall be the
owner and beneficiary of each such policy. If the Company fails to direct the
Trustee as to the investment of any assets of the Trust, the Trustee shall
invest such assets in such manner as it deems prudent pending the receipt of
investment directions from the Company; provided that the Trustee shall retain
each insurance policy contributed to the Trust or acquired pursuant to the
Company's direction until the Company directs the Trustee to surrender or
otherwise dispose of such policy. The Company may, at any time, direct the
Trustee to borrow funds under the loan provisions of any such policy and to
apply the proceeds of such loan to the premiums payable with respect to such
policy or to invest such proceeds in another manner directed by the Company.
7.2 General Powers. Except as otherwise directed by the Company, the Trustee
shall have the following powers with respect to the funds held pursuant to this
Agreement, in addition to those which it possesses as a matter of law and those
granted to it elsewhere in this Agreement:
(a) to sell properties held in the Trust fund at public or private sale for
cash or on credit; to exchange such properties; and to grant options for
the purchase or exchange of such properties;
(b) to exercise all conversion and subscription rights pertaining to
properties held in the Trust fund;
(c) to exercise all voting rights with respect to properties held in the
Trust and in connection with such rights to grant proxies, discretionary or
otherwise;
(d) to cause securities and other properties to be registered and held in
the name of a nominee for the Trustee or in such form that title will pass
by delivery;
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(e) to borrow money for the purposes of the Plan if, in its sole
discretion, the Trustee deems borrowing to be advisable; for sums so
borrowed to issue its promissory note as Trustee and to secure repayment by
pledging securities held in the Trust for which the funds were borrowed;
and to pay or charge interest at a reasonable rate upon sums so borrowed;
but this Trustee shall never be required to exercise the power to borrow
except as directed by the Company pursuant to Section 7.1 of this
Agreement;
(f) to consent to and participate in any plan of reorganization,
consolidation, merger, extension or other similar plan affecting property
held in the Trust fund; to consent to any contract, lease, mortgage,
purchase, sale or other action by any corporation pursuant to any such
plan; to accept and retain property issued under any such plan.
(g) to pay any premium due on any policy of insurance held in the Trust if
such premium is not paid by the Company.
7.3 Other Provisions Relating to Trustee. The Trustee accepts the Trust
created under this instrument but only upon the express terms and conditions of
this Agreement, including the following:
(a) Whenever in the administration of the Plan a certification is required
to be given to the Trustee, or the Trustee shall deem it necessary that a
matter be proved prior to taking, suffering or omitting any action
hereunder, such certification shall be duly made and said matter may be
deemed to be conclusively proved by an instrument, signed in the name of
the Company, by its Chief Executive Officer, its President, a Vice
President or by any other person specified in writing by the Company, but
in its discretion the Trustee may, in lieu thereof, accept other evidence
of the matter from a participant or may require such further evidence to it
as may seem reasonable. Generally, the Trustee shall be protected in
acting upon any notice, resolution, order, certificate, opinion, telegram,
letter or other document believed by the Trustee to be genuine and to have
been signed by the proper party or parties.
(b) The Trustee may consult with legal counsel (who may be counsel for the
Company) with respect to the construction of this Agreement or its duties
as Trustee, or with respect to any legal proceeding or any question of law.
(c) The Trustee may make any payment required by this Agreement by mailing
its check by first class mail in a sealed envelope addressed to the person
to whom such payment is to be made. The Trustee shall not be required to
make any investigation to determine or verify the identity or mailing
address of any person entitled to benefits under this Agreement and shall
be entitled to withhold making payments until the identity and mailing
addresses of persons entitled to benefits are certified to it. If any
dispute arises as to the identity or rights of
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persons entitled to benefits, the Trustee may withhold payment of benefits
until such dispute shall have been determined by arbitration or by a court
of competent jurisdiction or shall have been settled by written stipulation
of the parties concerned.
(d) The Trustee shall receive for its services compensation in accordance
with its separate agreement with the Company. Such compensation, together
with all other expenses of the Trustee incurred in its administration of
the trust, shall be charged to and paid by the Company or, if not so paid,
shall be paid from the Trust as an administrative expense.
(e) The Trustee shall keep full records of its administration of the Trust,
which the Company shall have the right to examine at any time during the
Trustee's regular business hours. Within sixty days following the close of
each calendar year, the Trustee shall furnish to the Company a statement of
account, and the Company shall promptly notify the Trustee in writing of
its approval or disapproval of such statement. Each such statement shall
include sufficient information for the Company to include in its income
tax returns all items of income, deduction and credit attributable to the
Trust Fund. If the Company fails to disapprove any such statement within
sixty days after its receipt, the Company shall be considered to have
approved the statement. Except to the extent inconsistent with law, the
approval by the Company of any statement of account shall be binding, as to
all matters embraced in the statement, on the parties to this Agreement and
on all participants, to the same extent as if the account of the Trustee
had been settled by judgment or decree in an action for a judicial
settlement of its accounts in a court of competent jurisdiction in which
the Trustee, the Company, the Administrator, and all persons having or
claiming any interest in the Trust were parties; provided, however, that no
provision of this Agreement shall deprive the Trustee of its right to have
its accounts judicially settled.
(f) Following prior written notice to the Company, the Trustee may accept,
compromise, settle, enforce or contest any obligation or liability due to
or from it as Trustee, including any claim that may be asserted for taxes
under present or future laws; but it shall not be required to institute or
continue litigation unless it is in possession of funds suitable for that
purpose or unless it has been indemnified to its satisfaction against its
counsel fees and all other expenses and liabilities to which it may in its
judgment be subjected by such action. The Trustee shall be entitled, out
of the recoveries of any litigation, to reimbursement for its expenses in
connection with such litigation.
(g) A third party dealing with the Trustee shall not be required to inquire
whether the Company, the Administrator or a participant has instructed the
Trustee, or whether the Trustee is otherwise authorized to take or omit any
action;
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or to follow the application by the Trustee of any money or property that
may be paid or delivered to the Trustee.
(h) The Trustee shall discharge its duties solely in the interest of the
participants and their beneficiaries, with the care, skill, prudence and
diligence in the circumstances then prevailing that a prudent person acting
in a like capacity and familiar with such matters would use in the conduct
of a like character with like aims.
(i) The liability of the Trustee to make the payments specified by the Plan
shall be limited to the funds which have come into its hands as Trustee.
ARTICLE VIII
CHANGE OF TRUSTEE
8.1 Resignation. The Trustee may resign at any time upon delivering to the
Chief Executive Officer or President of the Company a written notice of
resignation, to take effect not less than thirty days after its delivery, unless
such notice shall be waived.
8.2 Removal. The Trustee may, with the written consent of a majority of the
participants in all Plans for which a separate account is then maintained under
this Agreement, be removed by the Chief Executive Officer or President of the
Company and by delivery of a written notice of such action to the Trustee,
together with written notice of removal, to take effect at a date specified in
such notice, which shall not be less than thirty days after its delivery, unless
the Trustee waives such notice.
8.3 Discharge. A Trustee which has resigned or has been removed shall have the
right to a settlement of accounts, which may be made at the option of the
Trustee either by judicial settlement in an action instituted by the Trustee in
a court of competent jurisdiction or by agreement of settlement between the
Trustee, the Company and the participants of any Plan for which an account is
maintained.
8.4 Appointment of Successor. The Company covenants that it will, upon receipt
or giving of notice of the resignation or removal of a Trustee, forthwith
appoint, by action of its Chief Executive Officer or President, a successor
Trustee, which shall be independent of the Company and not subject to the
control of the Company or the participants. Such successor shall not, except
with the written consent of a majority of the participants in the Plans for
which the Trustee maintains separate accounts under this Agreement, be a person
other than a bank or trust company. Any successor Trustee so appointed may
qualify as such by executing, acknowledging and delivering to the Chief
Executive Officer or President of the Company and to the resigning or removed
Trustee, an instrument accepting such appointment, and such successor shall,
without further act, become vested with all the estate, rights, powers,
discretion and duties of the predecessor Trustee with like effect as if
originally named as Trustee.
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ARTICLE IX
AMENDMENTS OF TRUST AND PLANS
9.1 Trust Amendment. Except as limited below, the Chief Executive Officer of
the Company shall have the right to amend this Trust Agreement at any time to
any extent. Such amendment shall be stated in an instrument in writing,
executed by such Chief Executive Officer, attested by the Secretary or an
Assistant Secretary of the Company. Upon delivery of an executed counterpart of
such instrument to the Trustee, the Trust shall be deemed to have been amended
in the manner set forth in such counterpart, and all participants and Employers
shall be bound by the amendment; provided, however,
(a) that no amendment shall increase the duties or liabilities of the
Trustee without its written consent; and
(b) that no amendment shall have any retroactive effect so as to deprive
any participant, or the beneficiary of a deceased participant, of any
benefit attributable to a contribution made before such amendment to which
such participant or beneficiary would have been entitled had such amendment
not been made, unless the participant or beneficiary becomes entitled to an
amount equal to such benefit under another plan or practice adopted by the
Company or consents in writing to such amendment.
9.2 Additional Plans. The Company may, without the consent of any participant,
cause funds for one or more additional Plans to be held and administered
pursuant to this Agreement by delivering to the Trustee a revised Exhibit A
listing such additional Plans, executed in the manner of an amendment.
9.3 Plan Amendment. The Company covenants that it will promptly furnish or
cause to be furnished to the Trustee an executed counterpart of each document
amending a Plan.
ARTICLE X
MISCELLANEOUS PROVISIONS
10.1 Exclusive Benefit. Except as otherwise provided in the Plan or in this
Agreement, prior to the payment of all benefits under the Plan, in no
circumstances shall any part of the Trust fund revert to the Company or
otherwise be used for or diverted to any purpose other than the payment of
benefits under, and administrative expenses associated with, the Plan and other
than for the exclusive benefit of the participants or their beneficiaries.
10.2 Nonassignment. In no event shall any participant's or beneficiary's
interest in the Trust, while undistributed in fact, be alienated, assigned,
encumbered or anticipated in any manner, or be subject to garnishment,
attachment, execution or bankruptcy proceedings or to claims for alimony or
support or to any other claims of any person against such participant or
beneficiary.
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10.3 Termination of Trust. the Trust shall terminate when the entire Trust
fund has been disbursed by the Trustee in accordance with the terms of the Plans
and this Agreement or, if earlier, when all benefits that may become payable
under the Plan have been paid. Any property held by the Trustee upon
termination of the Trust shall be distributed to the Company or its successors
or assigns.
10.4 Name. The Trust evidenced by this Agreement may be referred to as the
"X.X. Xxxxxx Company Executive Benefit Trust."
10.5 Governing Law. Except to the extent that state law has been preempted by
provisions of any laws of the United States, as they may be amended from time to
time, this Agreement shall be construed and enforced according to the laws of
the State of Minnesota.
10.6 Enforcement. This Trust Agreement shall be binding upon and inure to the
benefit of the parties and their respective successors in interest and may be
enforced by any participant or beneficiary to whom benefits are payable from the
Trust funds.
IN WITNESS WHEREOF, the Company and the Trustee have executed this instrument as
of the date written below.
Dated: October 25, 1993 X.X. XXXXXX COMPANY
By /s/ Xxxxxxx X. Xxxxxxxx
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Chief Executive Officer
Attest: /s/ Xxxx Tanning
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Corporate Benefits Manager
FIRST TRUST NATIONAL ASSOCIATION,
TRUSTEE
By /s/ (signature illegible)
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Assistant Vice President
FIRST TRUST NATIONAL ASSOCIATION,
TRUSTEE
By /s/ (signature illegible)
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Vice President
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X.X. XXXXXX COMPANY
EXECUTIVE BENEFIT TRUST
SCHEDULE A
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1. Supplemental Executive Retirement Plan
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