EXHIBIT 10.2
TRUST AGREEMENT
FOR
THE MEN'S WEARHOUSE, INC. 401(K) SAVINGS PLAN TRUST
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.
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TRUST AGREEMENT
FOR
THE MEN'S WEARHOUSE, INC. 401(K) SAVINGS PLAN TRUST
TABLE OF CONTENTS
PURPOSE AND DEFINITIONS 1
ARTICLE I TRUST FUND 2
1.1 TITLE 2
1.2 TRUST FUND 2
1.3 TAX STATUS OF TRUST 2
1.4 APPOINTMENT OF AND ACCEPTANCE BY TRUSTEE 3
1.5 ADMINISTRATOR SHALL DIRECT TRUSTEE 3
1.6 SIGNING AUTHORITY; TRUSTEE'S RELIANCE 3
1.7 ACCEPTANCE OF ASSETS 3
1.8 FUNDING POLICY 3
ARTICLE II INVESTMENTS 4
2.1 TITLE TO ASSETS 4
2.2 ADMINISTRATOR AUTHORITY 4
2.3 MEMBER DIRECTION WITHIN SPONSOR SELECTED
INVESTMENT OPTIONS 4
2.4 INDEPENDENT INVESTMENT MANAGER 5
2.5 TRUSTEE INVESTMENT AUTHORITY 5
2.6 SPONSOR STOCK 6
2.7 PROXIES AND OTHER INCIDENTS OF OWNERSHIP 7
2.8 INSURANCE PRODUCTS 9
2.9 MEMBER LOANS 9
ARTICLE III TRUSTEE'S POWERS 10
3.1 GENERAL TRUSTEE'S POWERS 10
3.2 ADDITIONAL POWERS 12
3.3 ADMINISTRATOR/SPONSOR DIRECTIONS 13
ARTICLE IV TRUSTEE'S DUTIES 14
4.1 POWERS SUBJECT TO DUTIES 14
4.2 RECORDS 14
4.3 ACCOUNTS 14
4.4 VALUATION OF SPECIAL ASSETS 14
4.5 REPORTS 15
4.6 DIRECTIONS TO TRUSTEE 15
4.7 AUTHORIZED REPRESENTATIVE 15
4.8 WIRE TRANSFERS 15
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ARTICLE V RESTRICTIONS ON DISTRIBUTION 16
5.1 PERSONS TO RECEIVE PAYMENT 16
5.2 ASSIGNMENT AND ALIENATION PROHIBITED 16
5.3 QUALIFIED DOMESTIC RELATIONS ORDERS 17
ARTICLE VI RESIGNATION, REMOVAL AND SUCCESSION 17
6.1 RESIGNATION OR REMOVAL OF TRUSTEE 17
6.2 DESIGNATION OF SUCCESSOR TRUSTEE 17
6.3 SUCCESSOR'S POWERS 17
6.4 SUCCESSOR'S DUTIES 18
ARTICLE VII AMENDMENT 18
7.1 POWER TO AMEND 18
7.2 LIMITATION ON AMENDMENT 18
7.3 CONFORMITY WITH LAW 18
ARTICLE VIII LIABILITIES 18
8.1 DECLARATION OF INTENT 18
8.2 GENERAL LIMITATIONS OF LIABILITY 19
8.3 LIABILITY OF THE TRUSTEE 19
8.4 INDEMNIFICATION 20
ARTICLE IX DURATION AND TERMINATION 20
9.1 IRREVOCABILITY 20
9.2 TERMINATION 20
9.3 DURATION 21
ARTICLE X MISCELLANEOUS 21
10.1 EMERGENCIES AND OTHER DELEGATIONS 21
10.2 EXPENSES AND TAXES 21
10.3 PARTIES TO PROCEEDINGS 22
10.4 ADOPTION BY AFFILIATED EMPLOYER 22
10.5 PARTICIPATION BY AFFILIATES 22
10.6 WITHDRAWAL OF AN AFFILIATE 22
10.7 MULTIPLE PLANS 22
10.8 SUCCESSOR SPONSOR 22
10.9 LOCATING MEMBERS AND BENEFICIARIES 23
10.10 USE OF TRUST FUNDS 23
10.11 LOCATION OF TRUST ASSETS 23
10.12 PARTIAL INVALIDITY 23
10.13 COUNTERPARTS 24
10.14 SUCCESSORS AND ASSIGNS 24
10.15 RELATION TO THE PLAN 24
10.16 CONSTRUCTION AND JURISDICTION 24
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10.17 ALTERNATE DISPUTE RESOLUTION 24
SIGNATURE PAGE 25
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TRUST AGREEMENT
FOR
THE MEN'S WEARHOUSE, INC. 401(K) SAVINGS PLAN TRUST
This Trust Agreement (the "Trust Agreement") is made by and between The Men's
Wearhouse, Inc. (the "Sponsor"), sponsor of The Men's Wearhouse, Inc. 401(k)
Savings Plan (the "Plan"), and Union Bank of California, N.A., a national
banking association ("Union Bank of California" or the "Trustee"), and shall be
effective on the Trustee's receipt of Plan assets to be held in trust hereunder.
WHEREAS, the Sponsor has previously established a trust to fund benefits under
the Plan (the "Trust"); and
WHEREAS, the Sponsor desires to amend and restate the Trust and to continue the
Trust with Union Bank of California as the trustee of the Trust.
NOW, THEREFORE, for the consideration set forth herein, the parties agree as
follows:
PURPOSE AND DEFINITIONS
The Sponsor has adopted the Plan for the exclusive benefit of certain of its
employees ("Members") and their beneficiaries ("Beneficiaries"). The Plan
provides that, from time to time, cash and other assets shall be contributed to
the Trust by the Sponsor to be held and administered as a trust for the uses and
purposes of the Plan. Subject to specific conditions set forth in this Trust
Agreement, the Trustee agrees that it will hold in trust and will invest cash
and other property of the Plan received by and administratively acceptable to
the Trustee (the "Trust Assets" or the "Trust Fund") and will administer such
Trust Assets in accordance with the amended and restated terms and conditions of
the Trust stated below. The Trustee shall have no liability or responsibility
for any Plan assets not received by the Trustee. The Sponsor intends that the
Plan shall qualify under section 401 of the Internal Revenue Code of 1986, as
amended (the "Code"), and that the Trust shall constitute a part of the Plan,
and continue its tax exempt status under Code section 501.
Incorporation of Definitions Used in the Plan. Unless otherwise defined herein,
the definitions stated in the Plan are hereby incorporated by reference into
this Trust Agreement.
Definitions:
(a) "Administrator" shall mean the committee appointed by the
Board of Directors of the Sponsor that is responsible for the administration of
the Plan.
(b) "Business Day" shall mean a day of the week during which both
the Trustee and the New York Stock Exchange is open for business.
(c) "Code" shall mean the Internal Revenue Code of 1986, as it may
be amended from time to time.
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(d) "Directing Party" shall mean the person with the power to
direct investments.
(e) "Employer" or "Employers" means the Sponsor, K&G Men's
Company, Inc., a Delaware corporation, TMW Purchasing LLC, a Delaware limited
liability company, TMW Marketing Company, Inc., a California corporation, The
Men's Wearhouse of Texas LP, a Delaware limited partnership, TMW Merchants LLC,
a Delaware limited liability company, The Men's Wearhouse of Michigan, Inc., a
Delaware corporation, Twin Hill Acquisition Company, Inc., Xxxxx Xxxxxxxxx
Company, Inc., a Delaware corporation, TMW Ventures, Inc., a Delaware
corporation, TMW Finance LP, a Delaware limited partnership, and any other
business organization that adopts the Plan.
(f) "ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as it may be amended from time to time.
(g) "Investment Manager" shall mean a person or entity, other than
the Trustee, who is appointed by the Sponsor or Administrator to manage all or a
portion of the investments of the Trust Fund.
(h) "Plan" shall mean The Men's Wearhouse, Inc. 401(k) Savings
Plan.
(i) "Sponsor" shall mean The Men's Wearhouse, Inc., a Texas
corporation.
(j) "Sponsor Stock" shall mean the common stock of the Sponsor.
(k) "Trustee" shall mean UNION BANK OF CALIFORNIA or its successor
in interest, or any successor appointed pursuant to this Trust Agreement.
(l) "Trust Fund" shall mean the assets held by the Trustee
pursuant to this Trust Agreement.
ARTICLE I
TRUST FUND
1.1 Title. The title of the trust created by this Trust Agreement is the
Men's Wearhouse, Inc. 401(k) Savings Plan Trust.
1.2 Trust Fund. The Trust Fund shall consist of such sums of money or other
property as shall from time to time be paid or delivered to the Trustee pursuant
to the Plan, plus all income and gains, less losses, distributions and expenses
chargeable thereto. The Trust Fund shall be held in trust and dealt with in
accordance with the provisions of this Trust Agreement.
1.3 Tax Status of Trust. The Sponsor intends by this Trust Agreement to
create a trust forming a part of the Plan which shall meet the requirements for
qualification under section 401(a) of the Code and which shall be exempt from
tax pursuant to section 501(a) of the Code.
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1.4 Appointment of and Acceptance by Trustee. The Sponsor hereby appoints
Union Bank of California as nondiscretionary trustee of the Trust. The Trustee
shall function as a directed Trustee as defined in section 403(a) of ERISA.
Union Bank of California hereby accepts the Trust imposed upon it by this Trust
Agreement and covenants and agrees to perform the same as herein expressed.
1.5 Administrator Shall Direct Trustee. The Sponsor authorizes the
Administrator to direct and instruct Trustee as provided in this Agreement.
1.6 Signing Authority; Trustee's Reliance. A duly authorized officer of the
Sponsor shall certify in writing to the Trustee the names and specimen
signatures of the Administrator, and the Sponsor or Administrator shall notify
the Trustee in writing of all those who are authorized to act on behalf of the
Sponsor or Administrator (collectively, "Authorized Representative") and give
the Trustee their names and specimen signatures, which shall be updated as
necessary by the Sponsor or Administrator. The Sponsor or Administrator shall
promptly notify the Trustee if any person so designated is no longer authorized
to act on behalf of the Sponsor or Administrator. Until the Trustee receives
written notice that a person is no longer authorized to act on behalf of the
Sponsor or Administrator, the Trustee may continue to rely on the Sponsor's or
Administrator's designation of the identity and authority of such person, and
any directions given by such Authorized Representative.
1.7 Acceptance of Assets. All contributions or transfers shall be received
by the Trustee in cash or in any other property administratively acceptable to
the Trustee. The Trust shall consist of the contributions and transfers received
by the Trustee, together with the income and earnings from them and any
increments to them. The Trustee shall administer the Trust without distinction
between principal and income. The Trustee shall have no duty to compute any
amount to be transferred or paid to it by the Employer and it shall not be
responsible for the collection of any contributions or transfers to the Trust
and the Trustee shall have no duty to see that the contributions received comply
with the provisions of the Plan, or to see that funds deposited with it are
deposited in accordance with the provisions of the Plan.
1.8 Funding Policy. The Administrator shall have the responsibility for
establishing and carrying out a funding policy and method, as specified in
section 402(b)(1) of ERISA, consistent with the objectives of the Plan and the
requirements of ERISA, taking into consideration the Plan's short-term and
long-term financial needs. The Administrator shall assure that sufficient
liquidity shall be maintained to meet the reasonably anticipated requirements of
the Trust Fund for payment of expenses of administration, investment and
management, and for distribution of benefits to Members, former Members and
Beneficiaries.
The funding and investment policies established by the Administrator may be
modified at any time by the Administrator, who shall furnish written notice of
any such changes affecting the operation of the Trust to the Trustee.
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ARTICLE II
INVESTMENTS
2.1 Title to Assets. The Trustee is vested with title to all the assets of
the Trust Fund and shall have full power and authority to do all acts necessary
to carry out its duties hereunder. Members, former Members, and Beneficiaries
shall not have any right or interest in the Trust Fund except as provided in the
Plan. Prior to the time of distribution, neither a Member, former Member, nor a
Beneficiary (nor a legal representative of a Member, former Member, or a
Beneficiary) shall have any right, by way of anticipation or otherwise, to
assign, encumber, or in any manner dispose of any interest in the Trust except
as permitted under the Plan or as required by applicable law or directed by a
court of competent jurisdiction.
2.2 Administrator Authority. Except as provided below, the Administrator
shall have all power over, and responsibility for, the management, disposition,
and investment of the Trust Assets, and the Trustee shall comply with proper
directions (whether transmitted in writing, electronically, via
teletransmission, digitally, or in any other form acceptable to Trustee) of the
Administrator concerning those assets. The Administrator shall not issue
directions in violation of the terms of the Plan and Trust or prohibited by the
fiduciary responsibility rules of ERISA. Except to any extent required by ERISA,
or otherwise provided in this Trust Agreement, the Trustee shall have no duty or
responsibility to review, initiate action, or make recommendations regarding
Trust Assets and shall retain all such assets until directed in writing by the
Administrator to dispose of them.
2.3 Member Direction Within Sponsor Selected Investment Options. To the
extent the Plan provides for Member, former Member or Beneficiary direction of
investments among investment alternatives and their underlying investment
vehicles chosen by the Administrator ("Investment Options"), the Member, former
Member or Beneficiary shall have full investment authority over the investment
of assets allocated to such account (the "Member Directed Account" or "Account")
in that the Member, former Member or Beneficiary shall select among the
Investment Options. Such Member Directed Accounts are intended to qualify as
ERISA section 404(c) accounts. To the extent allowed under the Code, ERISA and
applicable regulations thereunder, neither the Employer, the Administrator nor
the Trustee shall have any responsibility for monitoring the directions of the
Member, former Member or Beneficiary, nor shall they be liable in any manner for
investment or other losses or have any other liability for following the
directions of the Member, former Member or Beneficiary or any agent designated
by them.
The Administrator shall establish uniform and nondiscriminatory rules for the
operation of Member Directed Accounts. Member Directed Accounts shall be subject
to the provisions of the Plan. The Trustee shall invest in the Investment
Options in accordance with investment directions given by the Members, former
Members, and Beneficiaries for whose accounts such assets are held, to the
extent consistent with its duties under ERISA. All such directions by the
Members, former Members, or Beneficiaries to the Trustee will be made in writing
or by telephone or in such other manner as is reasonably acceptable to the
Trustee. As provided under ERISA section 404(c) and the regulations thereunder,
the Trustee, the Employer, and the Administrator will not be liable for any
loss, or with respect to any breach of part 4 of Title I of
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ERISA, that is the direct and necessary result of the Member's, former Member's,
or Beneficiary's exercise of control over a Member Directed Account, and the
Trustee will not be liable for failing to invest any assets of the Trust Fund
under the management and control of the Sponsor or the Administrator, a Member,
a former Member, a Beneficiary or an Investment Manager in the absence of
investment directions regarding such assets, so long as the Trustee acts in good
faith and in accordance with the responsibilities, obligations and duties placed
on it under ERISA. In the absence of directions from a Member, former Member or
Beneficiary, the Administrator shall direct the investment of the Member
Directed Account. The Trustee shall have no duty or responsibility to review or
make recommendations regarding investments made in Investment Options at the
direction of the Member, former Member, Beneficiary, Administrator or Employer
and that are in accordance with the provisions of the Trust, ERISA and the Code.
The Trustee shall not comply with any directions which are contrary to the
provisions of the Trust, ERISA or the Code and the Trustee shall not incur any
liability to the Member, former Member, Beneficiary, Administrator or Employer
for acting in accordance with the provisions of this sentence.
2.4 Independent Investment Manager. The Sponsor or Administrator may
appoint one or more Investment Managers as defined in section 3(38) of ERISA to
direct the Trustee in the investment of all or a specified portion of the assets
of the Trust Fund. The Administrator may also remove any Investment Manager. The
Administrator shall promptly notify the Trustee in writing of the appointment or
removal of any Investment Manager.
The Administrator shall cause the Investment Manager to acknowledge to the
Trustee in writing that the Investment Manager is a fiduciary with respect to
the Plan and Trust. If the foregoing conditions are met, the Investment Manager
shall have the power to manage, acquire, retain, or dispose of any Trust Assets
subject to the Investment Manager's management and direction the Trustee will be
obligated to follow the investment directions of the Investment Manager with
respect to the assets of the specified portion of the Trust Fund until the
Trustee receives written notice that such Investment Manager has resigned or has
been removed or replaced by the Sponsor. The Trustee shall not be liable for the
acts or omissions of such Investment Manager, or be under an obligation to
review the investments of, or to invest or otherwise manage any asset of the
Trust that is subject to the management and direction of such Investment
Manager. The Investment Manager shall only make directions which are in
compliance with the applicable provisions of ERISA and any regulations or
rulings issued thereunder. An Investment Manager who engages any investment
advisor or investment counselor that it deems necessary or appropriate, may
provide that directions concerning the investment and reinvestment of the assets
of the Trust Fund under its management and control to be made directly to the
Trustee by such advisor or counselor as the Investment Manager's agent;
provided, however, that prior to any such direction by the investment advisor or
investment counselor, the Trustee receives written notice from the Investment
Manager that the directions of such agent will be considered the directions of
the Investment Manager and that the Investment Manager will be responsible for
the directions of such agent.
2.5 Trustee Investment Authority. The Administrator may also delegate its
investment authority to the Trustee for all or part of the Trust. Such
delegation must be in writing and delivered to the Trustee. Upon acceptance of
such delegation, the Trustee shall have full power
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and authority to invest and reinvest the portion of the Trust so designated by
the Administrator in investments of any kind permitted under this Trust
Agreement.
The Administrator is responsible for providing the Trustee with the funding
policy and investment guidelines for the Trust, and the Trustee's responsibility
for investment of the assets in the portion of the Trust for which Trustee has
investment discretion shall be subject to, and is limited by, the funding policy
and investment guidelines issued to it by the Administrator, and by the
fiduciary standards of ERISA.
To the extent the Trustee is a discretionary Trustee with the power to manage
and control all or a portion of the investments of the Trust Fund, it shall
invest and reinvest the principal and income with the care, skill, prudence and
diligence under the circumstances then prevailing that a prudent person acting
in a like capacity and familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims. The Trustee acknowledges that
it is a fiduciary with respect to Trust Assets for which it is a discretionary
Trustee. The Trustee shall be responsible for proper diversification of the
Trust only if all of the Plan's assets are subject to the Trustee's management.
The Administrator, and not the Trustee, shall be responsible for the funding
policy, for overall diversification of Plan assets, and for overall compliance
of the Trust with statutory limitations on the amount of the Trust's investment
in securities of the Sponsor ("Sponsor Stock").
2.6 Sponsor Stock. The Directing Party may direct investment of up to the
entire amount of the Trust Assets over which Directing Party has investment
authority into Sponsor Stock if permitted by applicable law. The Directing Party
shall not authorize or direct the investment of Trust Assets in Sponsor Stock
unless the Administrator is satisfied that the Sponsor Stock are exempt from
registration under the Federal Securities Act of 1933, as amended, and are
exempt from qualification under the California Corporate Securities Law of 1968,
as amended, and of any other applicable blue sky law, or in the alternative that
the Sponsor Stock have been so registered and/or qualified. The Administrator
shall also specify what restrictive legend on transfer, if any, is required to
be set forth on the certificates for the Sponsor Stock and the procedure to be
followed by the Trustee to effectuate a resale of such Sponsor Stock. The
Directing Party shall not direct the investment in Sponsor Stock if such
investment would be prohibited by ERISA. The Directing Party shall only direct
the investment of funds into Sponsor Stock if (i) those securities are traded on
an exchange permitting a readily ascertainable fair market value, or (ii) the
Administrator shall have obtained a current valuation by an independent
appraiser, and periodically (but no less frequently than annually) supplies
updated independent valuations while the Sponsor Stock remain in the Trust. In
determining the value of Sponsor Stock not traded on an exchange on a periodic
basis, the Trustee may conclusively rely on the independent appraisal or other
form of valuation acceptable to the Trustee and submitted to it by the
Administrator.
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2.7 Proxies and other Incidents of Ownership.
Funds Other Than Sponsor Stock
The Trustee shall deliver or cause to be delivered, to the Administrator or the
designated Investment Manager, all notices, prospectuses, financial statements,
proxies and proxy soliciting materials relating to investments, other than
Sponsor Stock held hereunder. Except for those Trust Fund assets for which Union
Bank of California is the Investment Manager, the Trustee shall not vote any
proxy or tender offer election, participate in any voting trust, exercise any
option or subscription right or join in, dissent from or oppose any merger,
reorganization, consolidation, liquidation or sale with respect to any asset
held hereunder except in accordance with the timely written instructions of the
Administrator. If no such written instructions are received, such proxies
elections and voting trust votes shall not be voted; such options or
subscription rights shall not be exercised; and such mergers, reorganizations,
consolidation, liquidations or sales shall not be joined, dissented from or
opposed.
Sponsor Stock
(a) VOTING OF SPONSOR STOCK. When the Sponsor files preliminary or final
proxy solicitation materials with the Securities and Exchange Commission, the
Sponsor shall cause a copy of all materials to be simultaneously sent to the
Trustee. Based on these materials, the Trustee shall prepare a voting
instruction form. At the time of mailing of notice of each annual or special
stockholders' meeting of the Sponsor, the Sponsor shall cause a copy of the
notice and all proxy solicitation materials to be sent to each Member or former
Member with an interest in Sponsor Stock held in the Trust, together with the
foregoing voting instruction form to be returned to the Trustee or its designee.
The form shall show the number of full and fractional shares of the Sponsor
Stock credited to each Member's or former Member's Account. The Sponsor shall
provide the Trustee with a copy of any materials provided to the Members and
former Members and shall certify to the Trustee that the materials have been
mailed or otherwise sent to the Members and former Members.
Each Member and former Member with an interest in Sponsor Stock held in
the Trust shall have the right to direct the Trustee as to the manner in which
the Trustee is to vote the number of shares of the Sponsor Stock reflecting such
Member's or former Member's proportional interest in the Sponsor Stock held in
the Trust. Directions from a Member or former Member to the Trustee concerning
the voting of the Sponsor Stock shall be communicated in writing, or by mailgram
or similar means. These directions shall be held in confidence by the Trustee
and shall not be divulged to the Sponsor, or any officer or employee thereof, or
any other person except to the extent that the Sponsor must have the safeguarded
information in order to comply with federal laws or state laws not preempted by
ERISA. Upon its receipt of the directions, the Trustee shall vote the shares of
the Sponsor Stock reflecting the Member's or former Member's proportional
interest in the Sponsor Stock held in the Trust as directed by the Member or
former Member. Except as otherwise provided by law, the Trustee shall vote
shares of the Sponsor Stock reflecting such Member's or former Member's
proportional interest in the Sponsor Stock held in the Trust for which it has
received no directions from the Member or former Member in the same proportion
on each issue as it votes those shares for which it received voting directions
from Members and
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former Members. The Trustee shall vote shares of the Sponsor Stock not credited
to Members' or former Members' Accounts in the same proportion on each issue as
it votes those shares credited to Members' and former Members' Accounts for
which it received voting directions from Members and former Members.
(b) TENDER OFFERS. Upon commencement of a tender offer for any
securities held in the Trust that are Sponsor Stock, the Sponsor shall notify
each Member and former Member of the tender offer and utilize its best efforts
to timely distribute or cause to be distributed to each Member and former Member
the same information that is distributed to other stockholders of the Sponsor in
connection with the tender offer, and, after consulting with the Trustee, shall
provide and pay for a means by which the Member or former Member may direct the
Trustee whether or not to tender the Sponsor Stock credited to the Member's or
former Member's Accounts. The Sponsor shall provide the Trustee with a copy of
any material provided to the Members and former Members and shall certify to the
Trustee that the materials have been mailed or otherwise sent to Members and
former Members.
Each Member and former Member shall have the right to direct the
Trustee to tender or not to tender some or all of the shares of the Sponsor
Stock reflecting his proportional interest in the Sponsor Stock held in the
Trust. Directions from a Member or former Member to the Trustee concerning the
tender of the Sponsor Stock shall be communicated in writing, or by mailgram or
such similar means as is agreed upon by the Trustee and the Sponsor under the
preceding paragraph. These directions shall be held in confidence by the Trustee
and shall not be divulged to the Sponsor, or any officer or employee thereof, or
any other person except to the extent that the consequences of such directions
are reflected in reports regularly communicated to any such persons in the
ordinary course of the performance of the Trustee's services hereunder. The
Trustee shall tender or not tender shares of Sponsor Stock as directed by the
Member or former Member. To the extent that Members or former Members fail to
affirmatively direct the Trustee or fail to issue valid directions to the
Trustee to tender shares of the Sponsor Stock credited to their Accounts, those
Members or former Members will be deemed to have instructed the Trustee not to
tender those shares. Accordingly, the Trustee shall not tender shares of Sponsor
Stock credited to a Member's or former Member's Accounts for which it has
received no directions or invalid directions from the Member or former Member.
The Trustee shall tender that number of shares of the Sponsor Stock not
credited to Members' or former Members' Accounts which is determined by
multiplying the total number of shares of the Sponsor Stock not credited to
Members' or former Members' Accounts by a fraction of which the numerator is the
number of shares of the Sponsor Stock credited to Members' or former Members'
accounts for which the Trustee has received valid directions from Members or
former Members to tender (which directions have not been withdrawn as of the
date of this determination) and of which the denominator is the total number of
shares of the Sponsor Stock credited to Members' or former Members' Accounts.
A Member or former Member who has directed the Trustee to tender some
or all of the shares of the Sponsor Stock credited to the Member's or former
Member's Accounts may, at any time prior to the tender offer withdrawal date,
direct the Trustee to withdraw some or all of the tendered shares, and the
Trustee shall withdraw the directed number of shares from the tender
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offer prior to the tender offer withdrawal deadline. Prior to the withdrawal
deadline, if any shares of the Sponsor Stock not credited to Members' or former
Members' Accounts have been tendered, the Trustee shall redetermine the number
of shares of the Sponsor Stock that would be tendered under this Section if the
date of the foregoing withdrawal were the date of determination, and withdraw
from the tender offer the number of shares of the Sponsor Stock not credited to
Members' or former Members' Accounts necessary to reduce the amount of tendered
Sponsor Stock not credited to Members' or former Members' Accounts to the amount
so redetermined. A Member or former Member shall not be limited as to the number
of directions to tender or withdraw that the Member or former Member may give to
the Trustee.
A direction by a Member or former Member to the Trustee to tender
shares of the Sponsor Stock reflecting the Member's or former Member's
proportional interest in the Sponsor Stock held in the Trust shall not be
considered a written election under the Plan by the Member or former Member to
withdraw, or have distributed, any or all of his withdrawable shares. The
Trustee shall credit to each proportional interest of the Member or former
Member from which the tendered shares were taken the proceeds received by the
Trustee in exchange for the shares of the Sponsor Stock tendered from that
interest.
(c) SHARES CREDITED. For all purposes of this Section 2.7, the
number of shares of the Sponsor Stock deemed "credited" to a Member's or former
Member's Accounts as of the relevant date (the record date or the date specified
in the tender offer) shall be calculated by reference to the number of shares
reflected on the books of the transfer agent as of the relevant date. In the
case of a tender offer, the number of shares credited shall be determined as of
a date as close as administratively feasible to the relevant date.
(d) CONVERSION. All provisions in this Section 2.7 shall also
apply to any securities received as a result of a conversion of the Sponsor
Stock.
2.8 Insurance Products. The Trustee shall not invest assets of the Trust in
insurance products.
2.9 Member Loans. Where loans are made to Plan Members or Beneficiaries
("Member Loans"), all fiduciary duties and responsibilities for administration
of the Trust with respect to any Member Loans shall rest with the Administrator
or a named fiduciary which shall be appointed by the Administrator (the "Loan
Fiduciary"). These duties shall include but not be limited to the review and
acceptance or rejection of loan applications, making of the Member Loans,
determination of allowable Member Loan amount, the determination of any grace
period for delinquent loans in accordance with regulations, after which Trustee
shall declare default and issue tax reports, and determination of when to
foreclose on collateral securing defaulted loans. Additionally, the Loan
Fiduciary shall establish the interest rate to be charged for the Member Loan,
the maturity date of the loan, the amount which may be loaned, and the amount of
the affected vested account balance which may secure the Member Loan under
applicable laws and regulations. In the absence of a formal appointment of a
Loan Fiduciary, the Administrator shall be the Plan's Loan Fiduciary. All loan
documents shall be prepared by the Trustee upon written direction of the Loan
Fiduciary unless otherwise authorized by the Loan Fiduciary and agreed to by the
Trustee. The Loan Fiduciary may appoint an agent to perform ministerial duties
with respect to the Plan loan program.
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ARTICLE III
TRUSTEE'S POWERS
3.1 General Trustee's Powers. Except as otherwise provided and subject to
any proper direction, applicable limitations in ERISA or other applicable law,
the Trustee shall have full power and authority with respect to property held in
the Trust to do all such acts, take all proceedings, and exercise all such
rights and privileges, whether specifically referred to or not in this document,
as could be done, taken or exercised by the absolute owner, including, without
limitation, the following:
(a) To invest and reinvest the Trust Assets or any part thereof in
any one or more kind, type, class, item or parcel of property, real, personal or
mixed, tangible or intangible; or in any one or more kind, type, class, or item
of obligation, secured or unsecured; or in any combination of them (including
those issued by the Trustee or any of its affiliates) and to retain the property
for the period of time that the Directing Party deems appropriate, despite
fluctuations in the market price of the property;
(b) To acquire and sell options to buy securities ("call" options)
and to acquire and sell options to sell securities ("put" options); to enter
into commodity contracts, financial futures contracts and foreign exchange
contracts and to take appropriate actions in connection with such contracts;
(c) To buy, sell, assign, transfer, acquire, loan, lease (for any
purpose, including mineral leases, and for terms within or extending beyond the
life of this Trust), exchange and in any other manner to acquire, manage, deal
with and dispose of all or any part of the Trust property, for cash or credit
and upon any reasonable terms and conditions;
(d) To make deposits, within the meaning of section 408(b)(4) of
ERISA, with any bank or other financial institution, including any such facility
of the Trustee or an affiliate thereof, provided that the deposit in an interest
bearing account or a time certificate of deposit bears a reasonable rate of
interest;
(e) To invest funds in any mutual fund whether or not sponsored or
advised by Union Bank of California or any affiliate thereof, for which Union
Bank of California or its affiliate renders services. Union Bank of California
or its affiliates may be compensated for providing such services to such mutual
fund, in addition to any Trustee's fees received pursuant to this Trust
Agreement;
(f) To invest and reinvest the Trust Assets, or any part thereof,
in any one or more collective investment funds, including group trusts that
consist exclusively of assets of exempt pension and profit sharing trusts and
individual retirement accounts qualified and tax exempt under the Code, that are
maintained by the Trustee or any affiliate thereof or any other bank or trust
company. The documents establishing and amending any such collective investment
funds are hereby incorporated herein and adopted into this Trust Agreement and
the Plan by this reference. The combining of money and other assets of the Trust
with money and other assets of
10
other qualified trusts in such fund or funds is specifically authorized.
Notwithstanding anything to the contrary in this Trust Agreement, the Trustee
shall have full investment responsibility over assets of the Trust invested in
its collective investment funds. The Trustee or its affiliates shall be entitled
to receive compensation for providing administration, advisory or other services
directly from the collective investment funds in addition to any Trustee's fees
received pursuant to this Trust Agreement.
If the Plan and Trust for any reason lose their tax exempt status, and
the Trust assets have been commingled with assets of other employers' tax exempt
trusts in the Trustee's collective investment funds, the Administrator shall
immediately notify the Trustee of such plan disqualification or loss of tax
exempt status and the Trustee shall liquidate, within 30 days of notice of such
loss of tax exempt status, the Trust's units of the collective investment
fund(s) and invest the proceeds in a money market fund pending investment or
other instructions from the Administrator. The Trustee shall not be liable for
any loss or gain or taxes, if any, resulting from said liquidation;
(g) To borrow or raise money for the purposes of the Trust from
any source (other than in a prohibited transaction as defined in sections 406 of
ERISA or 4975 of the Code, unless an exemption applies); to pay interest; to
execute promissory notes and to secure the repayment thereof by pledging all or
any part of the Trust Fund;
(h) Except as related to Sponsor Stock pursuant to Section 2.6, to
take all of the following actions as directed by the fiduciary or other person
with investment discretion over the Trust Assets: to vote upon or tender any
stocks, bonds or other securities and to give general or special proxies or
powers of attorney with or without power of substitution, except that Trustee
shall vote all proxies for securities in Investment Options as directed by
Administrator; to exercise any conversion privileges, subscription rights or
other options of which Trustee receives actual notice, and to make any payments
incidental thereto; to consent to or otherwise participate in corporate
reorganizations or other changes affecting corporate securities and to delegate
discretionary powers and to pay any assessments or charges in connection
therewith; and generally to exercise any of the powers of an owner with respect
to stocks, bonds, securities or other property held in Trust;
(i) To accept investment directions acceptable to the Trustee,
which shall be (i) in writing; (ii) immediately confirmed in writing if Trustee
agrees to accept oral directions; (iii) by facsimile; (iv) confirmed by an
eligible trade report if effected through the Institutional Delivery System (DTC
ID or comparable system). All other instructions shall be in writing. The
Trustee shall, as promptly as possible, comply with such directions, it being
understood that Trustee shall in no event be required to transact directed
trades on days which are not Business Days;
(j) To make, execute, acknowledge and deliver any and all
documents of transfer and conveyance and any and all other instruments that may
be necessary or appropriate to carry out the powers herein granted;
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(k) To pay or cause to be paid from the Trust any and all real or
personal property taxes, income taxes or other taxes or assessments of any or
all kinds levied or assessed upon or with respect to the Trust or Plan; and
(l) To do all other acts necessary or desirable for the proper
administration of the Trust Fund, as if the Trustee were the absolute owner
thereof.
3.2 Additional Powers. In addition to the other powers enumerated
above, and whether or not the Administrator has retained investment authority or
such authority has been delegated to the Member, former Member or an Investment
Manager pursuant to Article II, the Trustee in any and all events is authorized
and empowered:
(a) To cause all or any part of the Trust to be held in the name
of the Trustee (which in such instance need not disclose its fiduciary capacity)
or, as permitted by applicable law, in the name of any nominee, and to acquire
for the Trust any investment in bearer form. Trustee may combine certificates
representing such investments with certificates of the same issuer that it holds
in other fiduciary capacities; or it may deposit or arrange for the deposit of
such securities in a qualified central depository even though such securities
may then be merged and held in bulk in the name of the nominee of the depository
along with other securities deposited by other persons. Additionally, Trustee
may deposit or arrange for deposit of any securities issued by the United States
government or one of its agencies or instrumentalities in such a depository or
with a Federal Reserve Bank. However, the books and records of the Trust shall
at all times show that all such investments are a part of the Trust and the
Trustee shall hold evidences of title to all such investments;
(b) To serve as custodian with respect to the Trust assets with
the exception of Member Loan repayments, which may be held by the Plan's Loan
Fiduciary from time to time pending delivery to the Trustee, provided Union Bank
of California is the sole Trustee;
(c) To employ such agents and counsel as may be reasonably
necessary in managing and protecting the Trust assets and to pay them reasonable
compensation from the Trust; and to employ any broker-dealer or similar agent,
including a broker-dealer or similar agent affiliated with the Trustee, and pay
to such broker-dealer or similar agent from the Trust reasonable commissions or
reasonable compensation;
(d) To settle, compromise or abandon all claims and demands in
favor of or against the Trust; and to charge any premium on bonds purchased at
par value to the Trust;
(e) To abandon, compromise, contest, arbitrate or settle claims or
demands; to prosecute, compromise and defend lawsuits, but without obligation to
do so, all at the risk and expense of the Trust;
(f) To tender its defense to the Sponsor in any legal proceeding
where the interests of the Trustee and the Sponsor are not adverse. However, any
legal counsel selected to defend the Trustee must be reasonably acceptable to
the Trustee, and the Trustee may elect to choose
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counsel other than that selected by the Sponsor. The Sponsor may satisfy all or
any part of its obligations under this section through insurance arrangements
acceptable to the Trustee;
(g) To exercise and perform any and all of the other powers and
duties specified in this Trust Agreement or the Plan;
(h) To permit, during the Trustee's normal business hours, such
inspections of documents at the principal office of the Trustee as are required
by applicable law, subpoena, or upon demand by United States agency;
(i) To comply with all requirements imposed by ERISA, the Code or
other applicable provisions of law;
(j) To retain all or any portion of the Trust in cash temporarily
awaiting investment or for the purpose of making benefit distributions or other
payments, without liability for interest thereon, notwithstanding the Trustee's
receipt of indirect compensation known as float from such uninvested cash or
uncashed benefit checks;
(k) To exercise all the further rights, powers, options and
privileges granted, provided for, or vested in trustees generally under
applicable federal or state laws, as amended from time to time, it being
intended that, except as herein otherwise provided, the powers conferred upon
the Trustee herein shall not be construed as being in limitation of any
authority conferred by applicable law, but shall be construed as in addition
thereto;
(l) To seek written instructions from the Administrator,
Investment Manager, or other fiduciary on any matter and await their written
instructions without incurring any liability therefor;
(m) To impose a reasonable charge to cover the cost of furnishing
to Members, former Members or Beneficiaries upon their written request documents
as required under section 104(b)(4) of ERISA;
(n) To pay from the Trust the expenses reasonably incurred in the
administration of the Trust to the extent such expenses are not paid by the
Sponsor;
(o) To seek the advice of its counsel or the Sponsor's counsel,
and Trustee shall be protected to the extent permitted by applicable law in
acting upon advice of counsel; and
(p) In addition to the powers listed herein, to do all other acts
necessary or desirable for the proper administration of the Trust, as though the
absolute owner thereof.
3.3. Administrator/Sponsor Directions. As directed by the Administrator or
the Sponsor, the Trustee shall also be authorized and empowered:
(a) To cause the benefits provided under the Plan to be paid
directly to or for the persons entitled thereto under the Plan, and in the
amounts and in the manner specified, and to charge such payments against the
Trust;
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(b) To compensate such executive, consultant, actuarial,
accounting, investment, appraisal, administrative, clerical, secretarial,
custodial, depository and legal firms, personnel and other employees or
assistants as are engaged by the Sponsor or Administrator exclusively in
connection with the administration of the Plan and to pay from the Trust the
necessary expenses of such firms, personnel and assistants, to the extent not
paid by the Sponsor and not prohibited by applicable law;
(c) To pay from the Trust to reimburse the Sponsor for the
expenses reasonably incurred in the administration of the Trust paid by Sponsor
unless prohibited by the Plan or by applicable law.
(d) To maintain insurance for such purposes, in such amounts and
with such companies as the Administrator shall elect, including insurance to
cover liability or losses occurring by reason of the acts or omissions of
fiduciaries (but only if such insurance permits recourse by the insurer against
the fiduciary in the case of a breach of a fiduciary obligation by such
fiduciary).
ARTICLE IV
TRUSTEE'S DUTIES
4.1 Powers Subject to Duties. The Trustee shall exercise any of the
foregoing powers from time to time as required by applicable law.
4.2 Records. The Trustee shall maintain or cause to be maintained suitable
records, data and information relating to its functions hereunder. The Trustee
shall keep accurate and detailed accounts of all investments, receipts,
disbursements and other actions hereunder which shall be reflected as provided
in Section 2.10. Its books and records relating thereto shall be open to
inspection and audit at all reasonable times by the Employer, the Administrator
or their duly authorized representatives.
4.3 Accounts. Periodically, as specified by the Employer and within sixty
(60) days after the close of each Plan Year and within sixty days after the
resignation of the Trustee as provided in Article VII hereof, the Trustee shall
render to the Employer, Investment Manager a written report setting forth the
transactions effected by the Trustee during the period since it last furnished
such a report and any gains or losses resulting from same, any payments or
disbursements made by the Trustee during such period, the assets of the Trust
Fund as of the last day of such period (at cost and at fair market value), and
any other information about the Trust Fund that the Administrator may reasonably
request. The Trustee will certify the accuracy of the report if such
certification is required by any applicable federal or state law or regulation.
The Administrator, Employer, and Investment Manager (other than the Trustee
acting in such capacity) shall have ninety (90) days after the their receipt of
each such report within which to file with the Trustee written objections to
such report.
4.4 Valuation of Special Assets. Notwithstanding anything herein to the
contrary, the Trustee shall have no duty or responsibility to obtain valuations
of any Trust assets whose value is not
14
readily determinable on an established market. The Sponsor, Administrator, or
Investment Manager shall have sole responsibility to supply periodic valuations
of such assets to the Trustee in a timely manner. The Sponsor or the Trust as
appropriate, shall bear sole responsibility for the cost of obtaining said
valuations. The Trustee may conclusively rely on such valuations provided by the
Sponsor, Investment Manager, or Administrator. If they fail to provide such
values, the Trustee may take whatever action it deems reasonable, including
employment of attorneys, appraisers or other professionals, the expense of which
will be borne by the Trust.
4.5 Reports. The Trustee shall file such descriptions and reports and shall
furnish such information and make such other publications, disclosures,
registrations and other filings as are required of the Trustee by ERISA or other
applicable law, except for filings in connection with Sponsor Stock, which shall
be the sole responsibility of the Sponsor.
4.6 Directions to Trustee. The Trustee is authorized to act upon proper
directions of the Employer, the Administrator, Investment Manager, any other
fiduciary, Member, former Member, Beneficiary, Directing Party, and their
Authorized Representatives, as applicable, including directions given by
photostatic teletransmission using facsimile signature, or those instructions
which are digitally recorded on the UBOC Voice Response Unit ("VRU") or internet
website. The Trustee is also authorized to act on oral instructions in its
discretion prior to receipt of written or photostatic teletransmission
instructions. The Trustee is hereby authorized to record conversations and
facsimile transmissions made in connection with the Trust.
The Trustee shall not be liable for losses attributable to any directions, lack
of directions or exercise of control by a party with investment discretion over
the Trust or any part thereof. Likewise, the Trustee shall have no duty or
responsibility to review or make recommendations regarding investments made at
the direction of any party with investment discretion over the Trust or any
portion thereof.
4.7 Authorized Representative. The Sponsor or the Administrator shall
inform the Trustee in writing of the appointment of any Authorized
Representative to whom the Sponsor or the Administrator has given authorization
to direct the Trustee with respect to the Trust, any change in tax status, or
any other change in circumstances which could affect the Trustee's
administration or management of the Trust.
The Trustee may rely on such designations and follow any instructions of such
Authorized Representatives, whether oral, by facsimile or in writing as though
they were Sponsor's, Administrator's, Investment Manager's, Member's or former
Member's instructions, as applicable.
Any transactions initiated by the Trustee before receiving actual notice of any
change with respect to (a) such Authorized Representative(s) or their authority,
(b) the termination of the Account, or (c) termination of the fiduciary status
of the Sponsor or Administrator, shall be valid and binding on the Sponsor or
their successors and assigns, and the Trust.
4.8 Wire Transfers. The Trustee shall follow the Employer's or
Administrator's wire transfer instructions in compliance with the security
procedures promulgated by the Trustee and agreed to
15
by the Sponsor. The Trustee shall perform a telephonic verification to Employer
or Employer's Authorized Representative or such other security procedure, as
Trustee may require, prior to wiring funds or following facsimile directions.
The Employer assumes all risk of delay of transfer if the Trustee is unable to
reach the Employer or the Employer's Authorized Representative, or in the event
of delay as a result of attempts to comply with any security procedure selected
by the Employer.
ARTICLE V
RESTRICTIONS ON DISTRIBUTION
5.1 Persons to Receive Payment.
(a) The Trustee, upon the written direction of the Administrator
or by any other method authorized by the Administrator and agreed to by the
Trustee, shall make distributions from the Trust Fund to such persons, in such
manner, in such amounts (but not exceeding the then value of the Trust Fund),
and for such purposes as may be specified in the direction of the Administrator.
The Trustee shall, except as otherwise provided below, pay all amounts payable
hereunder only to, or for the benefit of, the person or persons designated under
the Plan or deposit to the Member's, former Member's or Beneficiary's checking
or savings account or Individual Retirement Account as directed by the
Administrator and not to any other person or corporation, and only to the extent
of assets held in the Trust for the benefit of the Member or former Member. The
Administrator's instructions to the Trustee to make distributions or not to make
distributions, and the amount thereof, shall be conclusive on all parties,
including but not limited to Members, former Members and Beneficiaries.
(b) In the event any controversy shall arise as to the person or
persons to whom any distribution or payment is to be made by the Trustee, or as
to any other matter arising in the administration of the Plan or Trust, the
Trustee may retain the amount in controversy pending resolution of the
controversy or the Trustee may file an action seeking declaratory relief and/or
may interplead the Trust Assets or funds in issue, and name as necessary parties
the Employer and/or any or all persons making conflicting demands.
(c) Whether a distribution or payment check has been issued or
not, the Trustee shall not be liable for the payment of any interest or income
on any amount paid or withheld or interpleaded under subsection (b).
(d) The expenses of the Trustee for taking any action under
subsection (b) shall be charged by the Trustee to the Trust, unless paid by the
Sponsor within thirty (30) days of the billing of such amount.
5.2 Assignment and Alienation Prohibited.
No benefit or interest available hereunder will be subject to assignment or
alienation, either voluntarily or involuntarily, except as provided in Section
5.3. Notwithstanding the, foregoing, the Sponsor may agree to allow Members,
former Members and Beneficiaries to borrow from the
16
Plan, and to secure their loans with their vested Account balances, to the
extent provided under the Plan and this Trust Agreement.
5.3 Qualified Domestic Relations Orders.
The preceding Section shall also apply to the creation, assignment, or
recognition of a right to any benefit payable with respect to a Member or former
Member pursuant to a domestic relations order, unless such an order is
determined by the Administrator to be a Qualified Domestic Relations Order, as
defined in ERISA and in section 414 (p) of the Code. Any domestic relations
order entered before January 1, 1985 will be treated as a Qualified Domestic
Relations Order if payment of benefits has commenced as of such date, and may be
treated as a Qualified Domestic Relations Order if payment of benefits had not
commenced as of such date, even though the order does not satisfy the
requirements of section 414(p). The Administrator shall direct the Trustee, in
writing, as to the disposition of any domestic relations order and shall direct
the Trustee as to any distributions necessary pursuant to any order determined
by the Administrator to be a Qualified Domestic Relations Order.
ARTICLE VI
RESIGNATION, REMOVAL AND SUCCESSION
6.1 Resignation or Removal of Trustee. The Trustee may resign at any time
upon ninety (90) days' prior written notice to the Sponsor, which notice may be
waived by the Sponsor. The Sponsor may remove the Trustee upon ninety (90) days'
prior written notice to the Trustee, which notice may be waived by the Trustee.
However, notwithstanding the foregoing or any other provision of the Plan or
this Trust Agreement to the contrary, the Trustee shall have an unrestricted
right of immediate resignation effective upon thirty (30) days' prior written
notice to the Sponsor with respect to any portion of the Trust Assets consisting
of Sponsor Stock.
6.2 Designation of Successor Trustee. Upon notice of Trustee's resignation
or removal, Sponsor shall promptly designate a Successor Trustee who will accept
transfer of the assets of the Trust. If no Successor Trustee is designated
within ninety (90) days of notice of Trustee's resignation or removal or if a
Successor Trustee designated by the Sponsor has not accepted its appointment,
within ninety (90) days after the Trustee gives notice of its resignation or
receives notice of removal, the Trustee may, at the expense of the Trust, apply
to a court of competent jurisdiction to appoint a Successor Trustee. The
references to ninety (90) days in this Section 6.2 shall be deemed to be
references to thirty (30) days in the case of the Trustee's resignation pursuant
to the third sentence of Section 6.1 with respect to any portion of the Trust
consisting of Sponsor Stock. Until a Successor Trustee is appointed, the Trustee
shall be entitled to be compensated for its services according to its published
fee schedule then in effect for acting as Trustee in accordance with the Plan
and Trust.
6.3 Successor's Powers. A Successor Trustee shall have the same powers and
duties as those conferred upon the original Trustee hereunder. A resigning
Trustee shall transfer the Trust Assets and shall deliver the books, accounts
and records of the Trust to the Successor Trustee as soon as practicable. The
resigning Trustee is authorized, however, to reserve such amount as
17
may be necessary for the payment of its fees and expenses incurred prior to its
resignation or removal, and the Trust Assets shall remain liable to reimburse
the resigning or removed Trustee for any costs, expenses or attorneys' fees or
losses incurred, whether before or after resignation or removal, due solely to
Trustee's holding title to and administration of Trust Assets.
6.4 Successor's Duties. A Successor Trustee shall have no duty to audit or
otherwise inquire into the acts and transactions of its predecessor.
ARTICLE VII
AMENDMENT
7.1 Power to Amend. The Trustee and the Sponsor shall have the right at any
time and from time to time to modify or amend this Trust Agreement in whole or
in part, upon written agreement by both parties.
7.2 Limitation on Amendment. No amendment shall be made at any time under
which any part of the Trust may be diverted to purposes other than for the
exclusive benefit of Members, former Members and their Beneficiaries or which
shall decrease the percentage or amount of the vested interest of any Member or
former Member.
7.3 Conformity with Law. Notwithstanding anything herein to the contrary,
this Trust Agreement may be amended prospectively or retroactively at any time
by the Sponsor and the Trustee if deemed necessary to conform to the provisions
and requirements of ERISA or the Code or regulations promulgated pursuant
thereto in order to maintain the tax-exempt status of this Trust thereunder, or
to conform to the provisions and requirements of any law, regulation, order or
ruling affecting the character or purpose of the Plan or Trust.
ARTICLE VIII
LIABILITIES
8.1 Declaration of Intent. In keeping with the public policy expressed in
section 410(a) of ERISA, nothing in this Article purports to relieve a fiduciary
from liability for any responsibility, obligation or duty under Part 4 of Title
I of ERISA. However, to the full extent permitted in section 405 of ERISA and
otherwise as not prohibited by applicable law, it is the intent of this Article
to relieve each fiduciary from all liability for any acts or omissions of any
other fiduciary or any other person and to declare the absence of liabilities of
all persons referred to in this Article to the extent not imposed by applicable
law or by provisions of this Trust Agreement. Each of the following Sections, in
declaring such limitations, is set forth without limiting the generality of this
Section but in each case shall be subject to the provisions, limitations and
policies set forth in this Section. Additionally, to the full extent permitted
in ERISA section 404(c), no fiduciary shall be liable for any investment
selection, investment loss or by reason of any breach of fiduciary duty or
breach of this Agreement which results from Member's, former Member's or
Beneficiary's exercise of control over the assets of his or her Account.
18
8.2 General Limitations of Liability
(a) A fiduciary shall not be liable with respect to a breach of
fiduciary duty under Title I of ERISA if such breach was committed before he,
she or it became a fiduciary or after he, she or it ceased to be a fiduciary.
(b) No fiduciary shall be liable for any act or omission of any
other person to whom fiduciary responsibilities (other than Trustee
responsibilities) are allocated by the Trust Agreement or by a named fiduciary,
except as provided in section 405(c) of ERISA.
8.3 Liability of the Trustee.
(a) The Trustee is not a party to the Plan and shall have no
powers, duties or responsibilities with regard to the administration of the Plan
or to determine the rights or benefits of any person having or claiming an
interest under the Plan or in the Trust or under this Trust Agreement or to
control any disposition of the Trust or part thereof which is directed by the
Administrator.
(b) The Trustee shall have no liability for the adequacy or
timeliness of contributions for the purposes of the Plan or for enforcement of
the payment thereof.
(c) The Trustee shall have no liability for the acts or omissions
of the Employer, the Administrator, a Member, former Member or Beneficiary, or
any Investment Manager (other than the Trustee acting in such capacity) or
Authorized Representative.
(d) The Trustee shall have no liability for following proper
directions of any party given authority to direct the Trustee pursuant to the
Trust Agreement or designated as an Authorized Representative.
(e) During such period or periods of time, if any, as a Directing
Party is directing the investment and management of Trust Assets, the Trustee
shall have no obligation to determine the existence of any conversion,
redemption, exchange, subscription or other right relating to securities
purchased on the directions of a Directing Party, if notice of any such right
was given prior to the purchase of such securities. If such notice is received
by the Trustee after the purchase of such securities, the Trustee shall notify
the Directing Party. The Trustee shall have no obligation to exercise any such
right unless it is informed of the existence of the right and is instructed to
exercise such right, in writing, by the Directing Party within a reasonable time
prior to the expiration of such right.
(f) If a Directing Party directs the Trustee to purchase
securities issued by any foreign government or agency thereof, or by any
corporation domiciled outside of the United States, it shall be the
responsibility of such Directing Party to advise the Trustee in writing with
respect to any laws or regulations of any foreign countries or any United States
territories or possessions which shall apply, in any manner whatsoever, to such
securities, including, but not limited to, receipt of dividends or interest or
reclamation of foreign taxes by the Trustee for such securities. If the Trustee
is directed not to reclaim foreign taxes, the Trustee shall have no
responsibility to reclaim any such taxes. Any expenses, costs or extraordinary
fees incurred by the Trustee for the reclamation of foreign taxes shall be
charged to the Trust.
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8.4 Indemnification.
(a) The Trustee shall not be liable for, and the Sponsor agrees to
indemnify and hold harmless the Trustee, its officers, directors, employees and
agents from and against any loss, liability, claims, demands, damages and
expenses (including reasonable attorneys' fees and other costs incurred by the
Trustee to third parties), any claims of breach of fiduciary duty brought by any
person or entity, lawsuits, disputes of any kind, and any taxes or penalties
incurred by the Trustee, which may arise from (i) any acts taken in good faith
in accordance with directions (or any action omitted in good faith in the
absence of such directions) from the Administrator, Sponsor, Investment Manager
(other than the Trustee acting in such capacity), Authorized Representative,
Member, former Member, Beneficiary, Loan Fiduciary or any other person
designated to act on their behalf which the Trustee reasonably believes to have
been given by them; (ii) the negligence or willful misconduct of the
Administrator, Sponsor, Investment Manager (other than the Trustee acting in
such capacity), Member, former Member, Beneficiary, Authorized Representative,
Loan Fiduciary or any other person designated to act on their behalf, or (iii)
any act or omission by the Sponsor, Administrator, Investment Manager (other
than the Trustee acting in such capacity), Member, former Member, Beneficiary,
Authorized Representative, Loan Fiduciary (other than the Trustee acting in such
capacity) or any other person designated to act on their behalf and which
results in loss to the Trust, except in the event of the Trustee's negligence,
willful misconduct or material breach of this Agreement which directly relates
to and causes the loss to the Trust.
(b) The Sponsor may satisfy all or any part of its obligations
hereunder through insurance arrangements acceptable to the Trustee.
(c) The indemnifications and releases provided herein shall
survive termination of this Trust Agreement, and shall apply to the parties'
successors and assigns.
ARTICLE IX
DURATION AND TERMINATION
9.1 Irrevocability. This Trust is hereby declared to be irrevocable, except
with respect to Section 9.2 below. It is intended that this Trust shall be
tax-exempt and that the Plan and Trust shall qualify under sections 401(a) and
501(a) of the Code.
9.2 Termination. This Trust Agreement and the Trust may be terminated at
any time by the Sponsor. Upon such termination, the Trust assets shall be
distributed by the Trustee as and when directed by the Administrator in
accordance with the provisions of this Trust Agreement; provided, however, that
the Trustee shall not be required to make any distribution prior to receipt of a
determination letter from the Internal Revenue Service that the termination does
not adversely affect the tax-exempt status of the Plan and Trust. In the event
the Administrator requests distribution of the Trust assets without receipt of a
favorable determination letter on Plan termination, the Sponsor shall indemnify
and hold the Trustee harmless against all claims, liability, costs and fees,
including but not limited to any attorneys' fees and costs, any taxes or
penalties, and any claims of breach of fiduciary duty brought by any person or
entity relating to
20
or resulting from such distribution. From the date of termination of the Plan
and until the final distribution of the Trust, the Trustee shall continue to
have all powers provided under this Trust that are necessary or desirable for
the orderly liquidation and distribution of the Trust. In no instance, upon any
termination and subsequent distribution, shall the Trust or any part of it be
used for, or diverted to, purposes other than for the exclusive benefit of
Members, former Members, and their Beneficiaries, and for defraying the
administrative expenses of the Plan and Trust until all Plan liabilities have
been satisfied.
9.3 Duration. This Trust shall continue in full force and effect for the
maximum period of time permitted by applicable law, unless this Trust is sooner
terminated in accordance with the Plan, the Code and ERISA.
ARTICLE X
MISCELLANEOUS
10.1 Emergencies and Other Delegations. In reference to situations involving
emergencies and the delegation of duties:
(a) In case of an emergency, the Trustee may, but shall not be
required to, act in the absence of directions from any person having the power
to direct the Trustee with respect to the matter involved and shall incur no
liability in so acting or not acting, except as to the Trustee's gross
negligence or willful misconduct. Such actions shall be conclusive on the
Administrator, the Member, the former Member and the Sponsor if written notice
of the proposed action is given prior to the action being taken, and the Trustee
receives no immediate response. Notwithstanding the foregoing, the Trustee shall
not be liable for failure to take any action in connection with Trust assets if
no direction is received.
(b) Notwithstanding any other provision in this Trust Agreement,
the Employer shall have the right, but not the obligation, to liquidate Trust
assets of a Member's or former Member's Account for purposes of payment of
distributions, or expenses and fees.
10.2 Expenses and Taxes.
(a) The Trust, or at the Sponsor's option, the Sponsor, shall
quarterly pay the Trustee its reasonable expenses in administering the Trust and
reasonable compensation for its services as Trustee at a rate to be agreed upon
by the parties to this Trust Agreement, based upon Trustee's published fee
schedule. However, the Trustee reserves the right to alter this rate of
compensation at any time by providing the Sponsor with notice of such change at
least one-hundred twenty (120) days prior to its effective date. Reasonable
compensation shall include compensation for any extraordinary services or
computations required.
(b) Reasonable counsel fees, reasonable costs, expenses and
charges of the Trustee incurred or made in the performance of its duties,
including but not limited to expenses relating to investment of the Trust such
as broker's commissions, stamp taxes, and similar items and all taxes of any and
all kinds that may be levied or assessed under existing or future laws upon or
in
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respect to the Trust or the income thereof shall constitute a charge upon the
Trust except to the extent that the Sponsor elects to pay such fees, costs and
expenses directly.
10.3 Parties to Proceedings. In any judicial, mediation, arbitration or
administrative proceedings, only the affected Employer and the Trustee shall be
necessary parties and no Member. Former Member or other person having or
claiming any interest in the Trust shall be entitled to any notice or service of
process (except as required by applicable law). Any judgment, decision or award
entered in any such proceeding or action shall be conclusive upon all interested
persons.
10.4 Adoption by Affiliated Employer. Any employer affiliated with Employer
("Affiliated Employer") may adopt the Employer's Plan with the approval of both
the Administrator and the Employer, and the Affiliated Employer shall
concurrently become a party to this Trust Agreement by giving written notice of
its adoption of the Plan and this Trust Agreement to the Trustee. Upon such
written notice, the Affiliated Employer shall be deemed a signatory to this
Trust Agreement.
10.5 Participation by Affiliates. The Sponsor is solely responsible for
supervising the process by which such Affiliated Employer participates in the
Plan and for ensuring the qualified status of the Plan and the tax-exempt status
of the Trust are not thereby adversely affected. The Administrator shall keep
records showing the assets attributable to each such Affiliated Employer
contributing to the Trust and the Trustee shall account separately within the
Trust for the assets attributable to each Affiliated Employer.
10.6 Withdrawal of an Affiliated Employer. In the event that an Affiliated
Employer elects, with the consent of the Sponsor, to withdraw from participation
in the Plan and so notifies the Trustee, the Trustee shall upon receipt of (a) a
certification by the Administrator setting forth the Trust assets allocable to
such withdrawal and (b) certified copies of the resolution of the Board of
Directors of the Employer approving the withdrawal or termination and approving
the instructions of the Administrator with regard to the segregation of the
assets of the Trust, segregate such assets and, on receipt of written directions
from the Administrator, make disposition thereof in accordance with Section 9.2
hereof or hold such segregated assets in a separate trust governed by the same
provisions as this Trust Agreement.
10.7 Multiple Plans. With the consent of the Trustee, the Sponsor may direct
that the assets of two or more qualified plans maintained by the Sponsor and
Affiliated Employers be maintained as one Trust and their assets be commingled.
10.8 Successor Employer. If any successor to an Employer continues the Plan
adopted by the Employer, such successor shall concurrently become a successor
first party to this Trust Agreement. The Successor Employer shall immediately
provide the Trustee with any required documentation if Authorized
Representatives have changed.
10.9 Locating Members and Beneficiaries. The Sponsor and Administrator will
be responsible for locating Members, former Members and Beneficiaries to
facilitate benefit payments and for compliance with reporting and disclosure
requirements.
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10.10 Use of Trust Funds.
(a) Notwithstanding anything to the contrary contained in this
Trust Agreement, or in any amendment thereto, it shall be impossible, except as
otherwise provided under ERISA, at any time prior to the satisfaction of all
liabilities with respect to the Members, former Members and Beneficiaries of the
Plan, for any part of the Trust Fund, other than such part as is required to pay
taxes and expenses of administration of the Plan and the Trust (including the
payment of Trustee's fees), to be used for, or diverted to, purposes other than
for the exclusive benefit of the Members, former Members and Beneficiaries.
(b) The Employer shall have no beneficial interest in the assets
of the Trust, and no part of the Trust shall ever revert to or be repaid to the
Employer, directly or indirectly, except that upon written request, the Employer
shall have a right to recover:
(1) an Employer's contribution or payment made by a mistake of
fact or law (within the meaning of section 403 of ERISA),
this Section shall not prohibit the return of such
contribution to the Employer (to the extent of such mistake
of fact or law) within one year after the payment of such
contribution to the Trust;
(2) an Employer's contribution or payment is conditioned upon
the deductibility of such amount under section 404 of the
Code, then, to the extent the deduction is disallowed, this
Section shall not prohibit the return of such contribution
to the Employer within one year after such determination of
disallowance of the deduction; and
(3) any residual assets due to a section 415 excess contribution
upon termination of the Plan if all liabilities of the Plan
to Members, former Members and their Beneficiaries have been
satisfied and the reversion does not contravene any
provision of law.
10.11. Location of Trust Assets. Except as authorized by the Secretary of
Labor by regulation, the indicia of ownership of any assets of the Trust and
Plan shall not be maintained outside the jurisdiction of the District Courts of
the United States.
10.12 Partial Invalidity. If any provision of this Trust Agreement is held to
be illegal or invalid for any reason, such illegality or invalidity shall not
affect the remaining provisions of this Trust Agreement, unless such illegality
or invalidity prevents accomplishment of the objectives and purposes of this
Trust Agreement and the Plan. In the event of any such holding, the parties will
immediately attempt to negotiate acceptable amendments to this Trust Agreement
as necessary to remedy any such defect.
10.13 Counterparts. This Trust Agreement may be executed in several
counterparts, each of which shall be deemed an original, and such counterparts
shall constitute but one instrument which may be sufficiently evidenced by any
one counterpart.
10.14 Successors and Assigns. This Trust Agreement shall inure to the benefit
of, and shall be binding upon, the parties and their successors and assigns.
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10.15 Relation to the Plan. This Trust Agreement and the Plan are both part
of and constitute a single integrated employee benefit plan and trust and shall
be construed together. In the event of any conflict between the provisions of
the Plan and this Trust Agreement, the provisions of this Trust Agreement shall
control with respect to all rights, duties, responsibilities, obligations,
powers and authorities of the Trustee, and the Trustee shall have no duty to
inquire into, nor shall it have any obligation or liability with respect to, the
provisions of the Plan.
10.16 Construction and Jurisdiction. This Trust Agreement shall be construed,
administered and enforced according to ERISA and the Code and where state law is
applicable, under California laws, fairly and equitably, and in accordance with
the purposes of the Plan. Jurisdiction for any dispute hereunder shall be in the
state of California.
10.17 Alternate Dispute Resolution. If a dispute arises out of or relates to
this Agreement, or the performance or breach thereof, the parties agree first to
try in good faith to settle the dispute by mediation under the Commercial
Mediation Rules of the American Arbitration Association. Thereafter, any
remaining unresolved controversy or claim arising out of or relating to this
Agreement, or the performance or breach thereof, shall be decided by binding
arbitration in accordance with the Commercial Arbitration Rules of the American
Arbitration Association. The sole arbitrator shall be a retired or former Judge
or other qualified panelist associated with the American Arbitration
Association. Judgment upon any award rendered by the arbitrator shall be final
and may be entered in any court having jurisdiction and the parties waive their
right to jury trial. Each party shall bear its own costs, attorneys' fees and
its share of arbitration fees. The Alternate Dispute Resolution provisions in
this Agreement do not constitute a waiver of the parties' rights to a judicial
forum in instances where arbitration would be void under applicable law, and do
not preclude the Trustee from exercising its rights to interplead the funds of
the Trust at the cost of the Trust.
* * * * * * * * Signature Page Follows * * * * * * * * *
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Signature Page
The parties have signed this Trust Agreement on the dates indicated below.
SPONSOR:
THE MEN'S WEARHOUSE, INC.
By: /s/XXXXX X. XXXXXX
-----------------------------------
Name: Xxxxx X. Xxxxxx
Its: Vice President, PAO Date: 2/13/2004
TRUSTEE:
UNION BANK OF CALIFORNIA, N.A.
By: /s/ XXXX XXXXXX
----------------------------------
Name: Xxxx Xxxxxx
Its: Vice President & Adm. Mgr. Date: 2/17/2004
By: /s/ XXXXXXXXX XXXXXXXXX
----------------------------------
Name: Xxxxxxxxx Xxxxxxxxx
Its: V.P., Compliance Date: 2/17/2004
