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Exhibit 10.4
THE XXXXXXXX & XXXXXX CORPORATION
AMENDED AND RESTATED
DEFERRED COMPENSATION TRUST III
as of August 21, 2003
This Agreement, initially effective as of the 12th day of February,
1998, and amended on February __, 2001 and August 18, 2003, is by and
between Xxxxxxxx & Ilsley Corporation ("Company") and Xxxxxxxx & Xxxxxx
Trust Company ("Trustee");
WHEREAS, Company has amended and restated its Directors Deferred
Compensation Plan (the "Plan") to allow its non-employee directors, as well
as those of its direct and indirect subsidiaries, divisions or affiliated
entities (the Company, along with such entities, referred to individually
as a "Plan Sponsor" and collectively as the "Plan Sponsors"), to participate
in the Plan by making deferrals of all or a portion of their retainer fees,
attendance fees and committee fees under the Plan and to defer gains
associated with exercises of stock options and the vesting of restricted
units; and
WHEREAS, the Company wishes to establish a trust (hereinafter called
"Trust") and the Company wishes to contribute, to its own account and those
of the other Plan Sponsors (the "Accounts") within the Trust, assets that
shall be held in each Plan Sponsor's respective Account, subject to the
claims of such Plan Sponsor's creditors in the event of its Insolvency and
the claims of the Company's creditors in the event of its Insolvency, as
herein defined, until paid to Plan participants and their beneficiaries from
their respective subaccounts (the "Subaccounts") within such Plan Sponsor's
Account, in accordance with the terms of the Plan; and
WHEREAS, it is the intention of the parties that this Trust shall
constitute an unfunded arrangement and shall not affect the status of the
Plan as an unfunded plan;
WHEREAS, it is the intention of the Company, to make contributions to
the Subaccounts under the Trust to meet the liabilities to participating
directors under the Plan.
NOW, THEREFORE, the parties do hereby establish the Trust and agree
that the Trust shall be comprised, held and disposed of as follows:
Section 1. Establishment of Trust.
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(a) The Company deposited assets with Trustee into its
Account under the Trust, which amount shall become the principal of
the Trust to be held, administered and disposed of by Trustee as
provided in this Trust Agreement.
(b) The Trust hereby established shall be irrevocable.
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(c) The Trust is intended to be a grantor trust, within the
meaning of subpart E, part I, subchapter J, chapter 1, subtitle A of
the Internal Revenue Code of 1986, as amended, and shall be construed
accordingly.
(d) The principal of the Trust, and any earnings thereon
shall be used exclusively for the uses and purposes of Plan
participants and their beneficiaries and general creditors of each
Plan Sponsor as herein set forth. Plan participants and their
beneficiaries shall have no preferred claim on, or any beneficial
ownership interest in, any assets of the Trust. Any rights created
under the Plan and this Trust Agreement shall be mere unsecured
contractual rights of Plan participants and their beneficiaries. Any
assets held in a Plan Sponsor's account under the Trust will be
subject to the claims of such Plan Sponsor's general creditors under
federal and state law in the event of such Plan Sponsor's Insolvency,
as defined in Section 3(a) herein and will also be subject to the
claims of the Company's general creditors under federal and state law
in the event of the Company's Insolvency, as defined in Section 3(a)
herein.
(e) The Company shall, from time to time, but no less
frequently than annually, make additional deposits of cash or other
property in trust with Trustee to augment the principal to be held,
administered and disposed of by Trustee as provided in this Trust
Agreement so that the funds in each Subaccount are sufficient to meet
the obligation to each participant in the Plan from time to time.
(f) Each Plan Sponsor, other than the Company, has joined in
and adopted this Trust by means of a joinder agreement (the "Joinder
Agreement"), substantially in the form of Exhibit A hereto, and in so
doing, shall appoint the Company as its agent for purposes of this
Trust, and shall agree that (i) it shall be bound by the Company's
decisions, actions, and directions under this Trust, (ii) the Company
has the sole authority to enforce this Trust on behalf of such Plan
Sponsor, and (iii) the Trustee shall be fully protected in relying
upon such decisions, actions, and directions, and the Trustee shall
in no event be required to give notice to, or otherwise deal with,
such Plan Sponsor except by dealing with the Company as agent of such
Plan Sponsor.
Section 2. Payments to Plan Participants and Their Beneficiaries.
__________________________________________________________________
(a) Company shall deliver to Trustee a schedule (the "Payment
Schedule") that indicates the amounts payable in respect of each Plan
participant (and his or her beneficiaries), that provides a formula
or other instructions acceptable to Trustee for determining the
amounts so payable, the form in which such amount is to be paid (as
provided for or available under the Plan) and the time of
commencement for payment of such amounts. Except as otherwise
provided herein, Trustee shall make payments to the Plan participants
and their beneficiaries in accordance with such Payment Schedule.
The Trustee shall make provision for the reporting and withholding of
any federal, state or local taxes that may be required to be withheld
with respect to the payment of benefits pursuant to the terms of the
Plan and shall pay amounts withheld to the appropriate taxing
authorities or determine that such amounts have been reported,
withheld and paid by the applicable Plan Sponsor.
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(b) The entitlement of a Plan participant or his or her
beneficiaries to benefits under the Plan shall be determined by
Company or such party as it shall designate, and any claim for such
benefits shall be considered and reviewed under such procedures as
the Committee, as defined in the Plan, shall establish.
(c) The Company may make payment of benefits directly to Plan
participants or their beneficiaries as they become due under the
terms of the Plan. Company shall notify Trustee of its decision to
make payment of benefits directly prior to the time amounts are
payable to participants or their beneficiaries. In addition, if the
principal of the Trust, and any earnings thereon, are not sufficient
to make payments of benefits in accordance with the terms of the
Plan, Company shall make the balance of each such payment as it falls
due. Trustee shall notify Company where principal and earnings are
not sufficient.
Section 3. Trustee Responsibility Regarding Payments To Trust
______________________________________________________________
Beneficiary When A Plan Sponsor is Insolvent.
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(a) When a Plan Sponsor or the Company is Insolvent, Trustee
shall cease payment of benefits to such Plan Sponsor's Plan
participants and their beneficiaries from their respective
Subaccounts within such Plan Sponsor's Account. A Plan Sponsor or
the Company shall be considered "Insolvent" for purposes of this
Trust Agreement if (i) the Plan Sponsor or the Company is unable to
pay its debts as they become due, (ii) the Plan Sponsor or the
Company is subject to a pending proceeding as a debtor under the
United States Bankruptcy Code, or (iii) the Plan Sponsor or the
Company is determined to be insolvent by any state or federal
regulatory authority.
(b) At all times during the continuance of this Trust, as
provided in Section l(d) hereof, the principal and income held in
each Plan Sponsor's Account within the Trust shall be subject to
claims of the general creditors of such Plan Sponsor and the Company
under federal and state law as set forth below.
(1) The Board of Directors and the Chief Executive
Officer of Company and each other Plan Sponsor shall have the
duty to inform Trustee in writing of its, or in the case of the
Company, its or any other Plan Sponsor's, Insolvency. If a
person claiming to be a creditor of any Plan Sponsor alleges in
writing to Trustee that such Plan Sponsor has become Insolvent,
Trustee shall determine whether such Plan Sponsor is Insolvent
and, pending such determination, Trustee shall discontinue
payment of benefits to such Plan Sponsor's Plan participants or
their beneficiaries from their respective Subaccounts within
such Plan Sponsor's Account. In the case of the claimed
insolvency of the Company, Trustee shall discontinue payment of
benefits to all Plan participants or their beneficiaries from
their respective Subaccounts.
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(2) Unless Trustee has actual knowledge of any Plan
Sponsor's Insolvency, or has received notice from Company,
another Plan Sponsor, or a person claiming to be a creditor
alleging that Company or any other Plan Sponsor is Insolvent,
Trustee shall have no duty to inquire whether any Plan Sponsor
is Insolvent. Trustee may in all events rely on such evidence
concerning any Plan Sponsor's solvency as may be furnished to
Trustee and that provides Trustee with a reasonable basis for
making a determination concerning any Plan Sponsor's solvency.
(3) If at any time Trustee has determined that any Plan
Sponsor is Insolvent, Trustee shall discontinue payments to
such Plan Sponsor's Plan participants or their beneficiaries
from their respective Subaccounts within such Plan Sponsor's
Account and shall hold the assets of the Trust for the benefit
of such Plan Sponsor's general creditors. If at any time
Trustee has determined that the Company is Insolvent, Trustee
shall discontinue payments to all Plan participants or their
beneficiaries from their respective Subaccounts and shall hold
the assets of the Trust for the benefit of the Company's
general creditors. Nothing in this Trust Agreement shall in
any way diminish any rights of Plan participants or their
beneficiaries to pursue their rights as general creditors of
their Plan Sponsor with respect to benefits due under the Plan
or otherwise.
(4) Trustee shall resume the payment of benefits to a
Plan Sponsor's Plan participants or their beneficiaries in
accordance with Section 2 of this Trust Agreement only after
Trustee has determined that the Company or the applicable Plan
Sponsor is not Insolvent (or is no longer Insolvent).
(c) Provided that there are sufficient assets in the Plan
Sponsor's Account under the Trust, if Trustee discontinues the
payment of benefits from such Plan Sponsor's Account pursuant to
Section 3(b) hereof and subsequently resumes such payments, the first
payment following such discontinuance shall include the aggregate
amount of all payments due to such Plan Sponsor's Plan participants
or their beneficiaries under the terms of the Plan for the period of
such discontinuance, less the aggregate amount of any payments made
to such Plan Sponsor's Plan participants or their beneficiaries by
such Plan Sponsor or the Company in lieu of the payments provided for
hereunder during any such period of discontinuance.
Section 4. Payments to the Plan Sponsors.
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Except as provided in Section 3 hereof, no Plan Sponsor shall have the
right or power to direct Trustee to divert to itself or others any of the
Trust assets before all payment of benefits have been made to Plan
participants and their beneficiaries pursuant to the terms of the Plan.
Upon payment in full of amounts owed to any participant hereunder, any
remaining amount shall revert to the Company and upon termination of the
Trust, all remaining amounts shall revert to the Company.
Section 5. Investment Authority.
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(a) Trustee may invest in securities (including stock or
rights to acquire stock) or obligations issued by Company. All
rights associated with assets of the Trust shall be exercised by
Trustee at the direction of the Company or the person designated
thereby (a "designee"), and shall in no event be exercisable by or
rest with Plan Participants.
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(b) In addition to the general investment powers set forth
above in this Section 5, the following provisions shall apply:
(i) Investment Guidelines and Directives. The Trustee
shall manage, acquire, or dispose of the assets of the Trust in
accordance with this Agreement and the directions of the Plan
Sponsors or their designee. To the extent permitted by law,
the Trustee shall not be liable for any investment made
pursuant to the Plan Sponsors' or their designees' direction.
(ii) Trustee Powers. The Trustee shall have the
following powers, rights and duties subject to Section 8 and
the other provisions of this Trust Agreement:
(A) To receive and hold all contributions paid to
it by the Company;
(B) To effectuate the written investment
instructions given by the Company or their designee
without regard to any law now or hereafter in force
limiting investments of fiduciaries;
(C) To retain in separate Accounts within the
trust for investment, any property deposited by the
Company hereunder, allocated among Subaccounts in
accordance with Section 7 hereof;
(D) To have the authority to invest and reinvest
assets of the Trust in shares of common or preferred
stock (including those of the Company), bonds, notes,
debentures, short-term securities, mutual funds
(including any such fund from which the Trustee or any
affiliate thereof receives an investment management fee
or any other fee), common trust funds, and other
property, real or personal, of any kind; to purchase and
sell "put" and "call" options on publicly traded
securities; and to acquire, hold, manage, operate, sell,
contract to sell, grant options with respect to, convey,
exchange, transfer, abandon, lease, manage, and otherwise
deal with respect to assets of the Trust;
(E) To acquire, hold or dispose of insurance or
annuity contracts as directed by the Company or their
designee;
(F) To borrow from anyone such amount or amounts
of money necessary to carry out the purpose of this Trust
and for that purpose to mortgage or pledge all or any
part of the Trust;
(G) To retain in the Trust for investment or
pending distributions, any portion of the Trust in cash
deemed appropriate by the Trustee;
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(H) To establish accounts in any affiliate of the
Trustee and in such other banks and financial
institutions as the Trustee deems appropriate to carry
out the purposes of the Trust;
(I) To deposit securities with a clearing
corporation as defined in Article Eight of the Uniform
Commercial Code; to hold the certificates representing
securities, including those in bearer form, in bulk form
with and to merge such certificates into certificates of
the same class of the same issuer which constitute assets
of other accounts or owners, without certification as to
the ownership attached; and to utilize a book-entry
system for the transfer or pledge of securities held by
the Trustee or by a clearing corporation, provided that
the records of the Trustee shall indicate the actual
ownership of the securities and other property of the
Trust Fund.
(J) To participate in and use the Federal book-
entry account system, a service provided by the Federal
Reserve Bank for its member banks for deposit of Treasury
securities.
(K) To hold securities or property in the name of
the Trustee or its nominee or nominees or in such other
form as it determines best with or without disclosing the
Trust relationship, providing the records of the Trust
shall indicate the actual ownership of such securities or
other property.
Section 6. Disposition of Income.
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During the term of this Trust, all income received by the Trust, net
of expenses and taxes, shall be accumulated and reinvested in the Trust.
Section 7. Accounting by Trustee.
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In order to comply with Section 3 hereof, Trustee shall establish and
maintain within the Trust a separate Account for each Plan Sponsor, which
shall at all times reflect such Plan Sponsor's equitable share in the Trust
fund, and shall hold, manage, administer, value, make purchases and sales
for, distribute, account for, and otherwise deal with, each such Account
separately.
Trustee shall keep accurate and detailed records of all investments,
receipts, disbursements, and all other transactions required to be made with
respect to the Trust as a whole and each Plan Sponsor's Account within the
Trust, including such specific records as shall be agreed upon in writing
between Company and Trustee. Within 30 days following the close of each
calendar year and within 30 days after the removal or resignation of
Trustee, Trustee shall deliver to Company a written account of its
administration of the Trust as a whole and each Plan Sponsor's Account
within the Trust during such year or during the period from the close of the
last preceding year to the date of such removal or resignation, setting
forth all investments, receipts, disbursements and other transactions
effected by it, including a description of all securities and investments
purchased and sold with the cost or net proceeds of such purchases or sales
(accrued interest paid or receivable being shown separately), and showing
all cash, securities and other property held in the Trust or such Account
at the end of such year or as of the date of such removal or resignation,
as the case may be.
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In addition, the Trustee shall establish and maintain Subaccounts for
Plan participants, within their Plan Sponsor's Account under the Trust, in
a manner that is consistent with the requirements of the Plan, and that
facilitates their investment instructions and benefit payments under the
Plan.
Section 8. Responsibility of Trustee.
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(a) Trustee shall act with the care, skill, prudence and
diligence under the circumstances then prevailing that a prudent
person acting in like capacity and familiar with such matters would
use in the conduct of an enterprise of a like character and with like
aims, provided, however, that Trustee shall incur no liability to any
person for any action taken pursuant to a direction, request or
approval given by any Plan Sponsor which is contemplated by, and in
conformity with, the terms of the Plan or this Trust and is given in
writing by any Plan Sponsor. In the event of a dispute between any
Plan Sponsor and a party, Trustee may apply to a court of competent
jurisdiction to resolve the dispute.
(b) If Trustee undertakes or defends any litigation arising
in connection with this Trust, the Company agrees to indemnify
Trustee against Trustee's costs, expenses and liabilities (including,
without limitation, attorneys' fees and expenses) relating thereto
and to be primarily liable for such payments. If the Company does
not pay such costs, expenses and liabilities in a reasonably timely
manner, Trustee may obtain payment from the Trust.
(c) Trustee may consult with legal counsel (who may also
be counsel for a Plan Sponsor generally) with respect to any of its
duties or obligations hereunder.
(d) Trustee may hire agents, accountants, actuaries,
investment advisors, financial consultants or other professionals to
assist it in performing any of its duties or obligations hereunder.
(e) Trustee shall have, without exclusion, all powers
conferred on Trustees by applicable law, unless expressly provided
otherwise herein, provided, however, that if an insurance policy is
held as an asset of the Trust, Trustee shall have no power to name a
beneficiary of the policy other than the Trust, to assign the policy
(as distinct from conversion of the policy to a different form) other
than to a successor Trustee or to loan to any person the proceeds of
any borrowing against such policy.
(f) Notwithstanding any powers granted to Trustee pursuant
to this Trust Agreement or to applicable law, Trustee shall not have
any power that could give this trust the objective of carrying on a
business and dividing the gains therefrom, within the meaning of
section 301.7701-2 of the Procedures and Administrative Regulations
promulgated pursuant to the Internal Revenue Code.
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Section 9. Compensation and Expenses of Trustee.
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Company shall pay all administrative and Trustee's fees and expenses.
If not so paid, the fees and expenses shall be paid from the Trust.
Section 10. Resignation and Removal of Trustee.
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(a) Trustee may resign at any time by written notice to
Company, which shall be effective 60 days after receipt of such
notice unless Company and Trustee agree otherwise.
(b) Trustee may be removed by Company on 30 days notice or
upon shorter notice accepted by Trustee.
(c) Upon resignation or removal of Trustee and appointment
of a successor Trustee, all assets shall subsequently be transferred
to the successor Trustee. The transfer shall be completed within 30
days after receipt of notice of resignation, removal or transfer,
unless Company extends the time limit.
(d) If Trustee resigns or is removed, a successor shall be
appointed, in accordance with Section 11 hereof, by the effective
date of resignation or removal under paragraphs (a) or (b) of this
section. If no such appointment has been made, Trustee may apply to
a court of competent jurisdiction for appointment of a successor or
for instructions. All expenses of Trustee in connection with the
proceeding shall be allowed as administrative expenses of the Trust.
Section 11. Appointment of Successor.
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(a) If Trustee resigns or is removed in accordance with
Section 10(a) or (b)hereof, Company may appoint any third party, such
as a bank trust department or other party that may granted corporate
trustee powers under state law, as a successor to replace Trustee
upon resignation or removal. The appointment shall be effective when
accepted in writing by the new Trustee, who shall have all of the
rights and powers of the former Trustee, including ownership rights
in the Trust assets. The former Trustee shall execute any instrument
necessary or reasonably requested by Company or the successor Trustee
to evidence the transfer.
(b) The successor Trustee need not examine the records and
acts of any prior Trustee and may retain or dispose of existing Trust
assets, subject to Sections 7 and 8 hereof. The successor Trustee
shall not be responsible for and Company shall indemnify and defend
the successor Trustee from any claim or liability resulting from any
action or inaction of any prior Trustee or from any other past event,
or any condition existing at the time it becomes successor Trustee.
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Section 12. Amendment or Termination.
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(a) This Trust Agreement may be amended by a written
instrument executed by Trustee and Company. Notwithstanding the
foregoing, no such amendment shall conflict with the terms of the
Plan or shall make the Trust revocable after it has become
irrevocable in accordance with Section 1(b) hereof.
(b) The Trust shall not terminate until the date on which
Plan participants and their beneficiaries are no longer entitled to
benefits pursuant to the terms of the Plan. Upon termination of the
Trust any assets remaining in the Trust shall be returned to Company.
(c) Upon written approval of participants or beneficiaries
entitled to payment of benefits pursuant to the terms of the Plan,
Company may terminate this Trust prior to the time all benefits
payments under the Plan have been made. All assets in the Trust at
termination shall be returned to Company.
Section 13. Miscellaneous.
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(a) Any provision of this Trust Agreement prohibited by law
shall be ineffective to the extent of any such prohibition, without
invalidating the remaining provisions hereof.
(b) Benefits payable to Plan participants and their
beneficiaries under this Trust Agreement may not be anticipated,
assigned (either at law or in equity), alienated, pledged, encumbered
or subjected to attachment, garnishment, levy, execution or other
legal or equitable process.
(c) This Trust Agreement shall be governed by and construed
in accordance with the laws of the State of Wisconsin, without
application of its principles of conflicts of laws.
Section 14. Effective Date.
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The effective date of this Trust Agreement shall be February 12, 1998,
subject to approval of the Plan by the Company's shareholders on April 28,
1998. If such approval is not received, this Trust shall be null and void
and of no further effect.
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IN WITNESS WHEREOF, the Company and Trustee have caused this Agreement
to be duly executed on the date first above written.
XXXXXXXX & XXXXXX CORPORATION
By: /s/ Xxxx X. Xxxxxx
_______________________________
Title: Senior Vice President
Attest: /s/ Xxxxxxx X Xxxxxxxx
_______________________________
Title: Secretary
XXXXXXXX & ILSLEY TRUST COMPANY
By: /s/ Xxxxxxx X. Xxxxx
_______________________________
Title: Vice President and Manager
of Commercial Trust
Attest: /s/ Xxxxxx X. Xxxxxx
_______________________________
Title: Vice President and
Relationship Manager
MW80070_4.DOC
