Exhibit 10.12
TRUST AGREEMENT
This Agreement made as of the day of ,
1989, by and between EQUITABLE RESOURCES, INC., a corporation
duly established and existing under the laws of the
Commonwealth of Pennsylvania (hereinafter referred to as the
"Company"), and Pittsburgh National Bank (hereinafter
referred to as the "Trustee").
WITNESSETH
WHEREAS, the Company established the Equitable Gas
Company Supplemental Pension Plan (the "Supplemental Pension
Plan") effective January 1, 1984, as a nonqualified,
deferred, unfunded, excess benefits plan to provide benefits
to employees of the Company (at that time named Equitable Gas
Company) and its affiliated companies in amounts equal to
those they would be entitled to under any defined pension
benefit plan of the Company or its affiliates except for the
maximum benefit limitations of Section 415 of the Internal
Revenue Code; and
WHEREAS, the Company established a Policy to Grant
Supplemental Deferred Compensation Benefits in Selected
Instances to a Select Group of Management or Highly
Compensated Employees (the "Supplemental Deferred
Compensation Policy"), effective January 1, 1984, to enable
the Company to contract with certain designated employees in
order to provide them with benefits equivalent to those that
they would be entitled to receive had they retired at age 65
after 30 years of service with the Company; and
WHEREAS, the Company established a nonqualified, unfunded
Retirement Program for the Board of Directors of the Company
(the "Directors' Retirement Program") effective July 12,
1984, to pay retirement benefits to members of the Board of
Directors; and
WHEREAS, the Company has entered into a Supplemental
Executive Retirement Plan (the "Supplemental Executive Plan")
effective January 1, 1989, as a nonqualified, deferred,
unfunded plan to provide benefits to employees of the Company
and its affiliated companies in amounts equal to those they
would be entitled to under any defined pension benefit plan
of the Company or its affiliates except for the maximum
benefit limitations of Section 401(a)(17) of the Internal
Revenue Code and the maximum years of service limitation of
Section 401(1) of the Internal Revenue code; and
WHEREAS, the Company desires to establish an irrevocable
trust (hereinafter referred to as the "Trust") and to
transfer to the Trust assets which shall be held there in
order to fund the Company's obligations under the
Supplemental Pension Plan, the Supplemental Deferred
Compensation Policy, the Directors' Retirement Program and
the Supplemental Executive Plan (the Supplemental Pension
Plan, the Supplemental Deferred Compensation Policy, the
Directors' Retirement Program and the Supplemental Executive
Plan hereinafter jointly referred to as the "Deferral
Agreements") subject to the claims of the Company's general
creditors in the event of the Company's bankruptcy or
insolvency, until paid as provided in this Agreement.
NOW, THEREFORE, in consideration of the premises and
mutual covenants contained herein and intending to be legally
bound hereby, the Company and the Trustee do hereby covenant
and agree as follows:
SECTION 1
TRUST FUND
(A) The Trustee shall receive for deposit in the Trust
such cash or other property as shall be transferred to the
Trustee by the Company and thereupon the Trust shall be
established. All cash or other property so received, together
with the income therefrom and any other increment thereon
shall be held, managed and administered by the Trustee
pursuant to the terms of this Agreement without distinction
between principal and income. The Company may make, from time
to time, additional deposits of cash or other property to the
Trust to be held and administered and disposed of by the
Trustee as provided in this Agreement.
(B) The Trust is intended to be a "grantor trust," within
the meaning of Section 671 of the Internal Revenue Code of
1986, and shall be construed accordingly.
(C) For accounting purposes only, a separate account
shall be established for each individual participant in the
Supplemental Pension Plan, for each individual participant in
the Supplemental Deferred Compensation Policy, for each
individual participant in the Directors' Retirement Program,
and for each individual participant in the Supplemental
Executive Plan. Monies allocated to any of these individual
accounts (hereinafter the "Trust Accounts") shall be
distributable only to the beneficiary of such account (or to
the appropriate beneficiaries of such beneficiary pursuant to
the provisions of the Deferral Agreements) subject to the
provisions set forth below. Such Trust Accounts are
collectively designated hereinafter as the "Trust Fund."
(D) The Trust Fund shall be held separate and apart from
other funds of the Company and shall be used exclusively for
the purpose of assuring payment by the Company of future
obligations of the Company under the Deferral Agreements,
except to the extent otherwise set forth herein.
SECTION 2
DISTRIBUTIONS FROM TRUST FUND
(A) The Company's Board of Directors' Compensation
Committee in the case of Trust Accounts relating to the
Directors' Retirement Program and the Company's Employee
Pension Committee in the case of Trust Accounts relating to
the Supplemental Pension Plan; the Supplemental Executive
Plan and the Supplemental Deferred Compensation Policy shall
each designate to the Trustee one or more representatives
(hereinafter individually or collectively the "Designated
Representatives") who shall direct the Trustee, by express
written instructions, with respect to all distributions from
the Trust Fund, including the amounts, dates and party or
parties, which may include the Company, to whom such
distribution shall be made. All such distributions shall be
made to such party as absolute owner, free and clear of the
Trust.
(B) The Company shall provide the Trustee with a
certified list of the names and specimen signatures of the
Designated Representatives. The Company shall also notify the
Trustee in writing from time to time of any changes in the
Designated Representatives. Until such times as the Trustee
is notified by the Company of any such change, the Trustee
may continue to rely on instructions from such Designated
Representatives.
(C) No person, including any participant in the Deferral
Agreements, shall have any preferred claim on, or any
beneficial ownership interest in, the Trust Fund prior to the
time payment from the Trust Fund is made to such person, and
all rights created under the Deferral Agreements or the Trust
shall be mere unsecured contractual rights against the
Company.
(D) The Trustee shall make distributions from the Trust
Fund pursuant to the written instructions received by the
Trustee in accordance with paragraph (A) above (provided that
at the time of payment the Trustee has not made a
determination in accordance with the provisions of Section 3
below that the Company is Insolvent), and the Trustee shall
have no liability for any distributions made by it pursuant
to such written instructions. The Trustee shall have no duty
to make inquiries as to whether any distribution in
accordance with this paragraph (D) is made pursuant to the
provisions of the Deferral Agreements. In no event shall the
Trustee be obligated or liable to make payments to any
participant in excess of the value of the assets held in
the applicable Trust Accounts.
SECTION 3
TRUSTEE RESPONSIBILITY REGARDING PAYMENTS
FROM TRUST FUND WHEN COMPANY INSOLVENT
(A) This Agreement and the Trust shall be irrevocable;
provided, however, that at all times during the continuance
of this Agreement and the Trust, the Trust Fund shall be
subject to the claims of the creditors of the Company as
hereinafter set forth.
(B) The Company shall be considered Insolvent for
purposes of this Agreement if it is:
(i) unable to pay its debts as they mature; or
(ii) subject to a pending proceeding as a debtor
under the Bankruptcy Code.
(C) At any time the Trustee has actual knowledge, or has
determined in accordance with paragraph (D) below, that the
Company is Insolvent, the Trustee shall hold for the benefit
of, or deliver upon the order of a court of competent
jurisdiction, any undistributed portion of the Trust Fund to
satisfy the claims of the Company's general creditors.
(D) The Board of Directors of the Company and the Chief
Executive Officer of the Company shall have the duty to
inform the Trustee of the Company's Insolvency. If the
Company or a person claiming to be a creditor of
the Company alleges in writing to the Trustee that the
Company has become Insolvent, the Trustee shall independently
determine, within thirty (30) days after receipt of such
notice whether the Company is Insolvent, and pending such
notice whether the Company is Insolvent, and pending such
determination, shall discontinue all payments from the Trust
Fund. The Trustee shall resume payments in accordance with
Section 2 of this Agreement only after the Trustee
has determined that the Company is not Insolvent (or is no
longer Insolvent, if the Trustee initially determined the
Company to be Insolvent). Nothing in this Agreement shall in
any way diminish any rights of any participant in the
Deferral Agreements to pursue his or her rights as a general
creditor of the Company with respect to benefits under the
Deferral Agreements.
(E) Unless the Trustee has received notice or otherwise
has actual knowledge of the Company's Insolvency or alleged
Insolvency, the Trustee shall have no duty to inquire as to
whether the Company is Insolvent. The Trustee may in all
events rely on evidence concerning the Company's solvency
which will give the Trustee a reasonable basis for making a
determination concerning the Company's solvency.
(F) If the Trustee discontinues payments to a person from
the Trust Fund pursuant to paragraph (D) above and
subsequently resumes such payments, the first payment to such
person following the discontinuance shall include the
aggregate amount of all payments which would have been made
to such person in accordance with Section 2 of this Agreement
during the period of such discontinuance less the aggregate
amount of payments made to such person by the Company in lieu
of payment hereunder for such period of discontinuance, as
specified in writing to the Trustee by the Designated
Representatives.
SECTION 4
PAYMENTS TO COMPANY
Neither the Designated Representatives nor the Company
shall have any power or right to direct the Trustee to return
to the Company or to divert to others (other than
participants in the Deferral Agreements) any portion of the
Trust Fund prior to the complete satisfaction of the
Company's obligations to participants in the Deferral
Agreements. If the Company determines that a portion of the
Trust Fund will clearly never be required to satisfy such
obligations, such portion may be returned to the Company if
the Trustee is directed to make such payment by the
Designated Representatives in accordance with Section 2(A)
above; the Trustee shall be entitled to rely on the written
direction of the Designated Representatives and shall have no
duty or obligation to inquire about or challenge such
determination by the Company. In addition, on termination of
the Trust as provided in Section 9(B) of this Agreement, any
remaining assets shall be returned to the Company as provided
in Section 9(C). Notwithstanding the foregoing, the
Designated Representatives may direct the Trustee to
reimburse the Company for payments made by the company to
participants in the Deferral Agreements in satisfaction
of its obligations thereunder.
SECTION 5
INVESTMENT AND ADMINISTRATION OF TRUST
(A) The Trustee shall invest and reinvest the assets in
the Trust Fund in accordance with the directions of the
Treasurer or Assistant Treasurer of the Company.
(B) The Trustee shall have the following powers and
authority in the administration and investment of the Trust,
to be exercised as provided in Section 6 of this Agreement:
(i) to exercise (subject to Company direction) any and
all investment powers that would be possessed if
it were the sole and absolute owner of all
securities or other property forming the Trust
Fund and to purchase or subscribe for any
securities or other property and to retain in the
Trust such securities or other property;
(ii) to settle, compromise or submit to arbitration,
any claims, debts or damages, due or owing to or
from the Trust, to commence or defend suits or
legal proceedings and to represent the Trust in
all suits or legal proceedings; provided,
however, that the Trustee shall not be required
to undertake or to defend any litigation arising
in connection with this Agreement, the Trust or
the Trust Fund (other than litigation between
the Company and the Trustee or in connection
with any alleged negligence or gross or willful
misconduct by the Trustee with respect thereto)
unless it is first indemnified by the Company
against its prospective costs, expenses and
liability;
SECTION 6
ACCOUNTING BY TRUSTEE
(A) The Trustee shall keep accurate and detailed records
of all investments, receipts, disbursements and all other
transactions required to be done, including such specific
records as shall be agreed upon in writing from time to time
between the Company and the Trustee. All such accounts, books
and records shall be open to inspection and audit at all
reasonable times by the Company, and the Designated
Representatives. Within sixty (60) days following the close
of each calendar year (or such other date as shall be agreed
upon in writing between the Company and the Trustee) and
within sixty (60) days after the removal or resignation of
the Trustee, the Trustee shall deliver to the Company a
written account of its administration of 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 receipts, investment earnings,
disbursements and other transactions effected by it and
showing all cash and other property held in the Trust
Accounts and Trust Fund at the end of such year or as of the
date of such removal or resignation, as the case may be, and
certified as to the accuracy of the information set forth
therein. In the absence of the filing in writing with the
Trustee by the Company of exceptions or objections to any
such account within ninety (90) days, the Company shall be
deemed to have approved such account; and in such case, or
upon the written approval of the Company of any such account,
the Trustee shall be released, relieved and discharged with
respect to all matters and things set forth in such account
as though such account had been settled by the decree of a
court of competent jurisdiction.
SECTION 7
RESPONSIBILITY OF TRUSTEE
(A) The Trustee shall act 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; provided, however, that
the Trustee shall incur no liability to anyone for any action
taken pursuant to a direction, request or approval given by
the Company or the Designated Representatives, contemplated
by and complying with the terms of this Agreement. The
Company hereby agrees to indemnify the Trustee and hold it
harmless from and against any claim or liability which may be
asserted against the Trustee by reason of any such action.
(B) The Trustee may consult with legal counsel (who may
also be counsel for the Trustee generally) with respect to
any of its duties or obligations hereunder, and shall be
fully protected in acting or refraining from acting in
accordance with the advice of such counsel.
(C) The Trustee shall exercise the powers listed in
Section 5 of this Agreement at all times in a fiduciary
capacity primarily in the interest of the Company.
(D) In addition to the powers and authority granted to
the Trustee pursuant to Section 4(B) of this Agreement, the
Trustee shall have, without exclusion, all powers conferred
on Trustees by the laws of the Commonwealth of Pennsylvania
unless expressly provided otherwise herein.
SECTION 8
COMPENSATION AND EXPENSES OF TRUSTEE
The Trustee shall be entitled to receive such reasonable
compensation for its services as shall from time to time be
agreed upon by the Company and the Trustee. The Trustee shall
also receive reimbursement for reasonable expenses incurred
by it with respect to the administration of the Trust. Such
compensation and expenses, and all income taxes and other
taxes of any and all kinds levied or assessed under existing
or future laws against the Trustee on behalf of the Trust or
against the Trust Fund shall be a charge on the Trust Fund to
the extent not paid by the Company.
SECTION 9
REPLACEMENT OF TRUSTEE
The Trustee may be removed at any time by action of the
Board of Directors of the Company and written notice to the
Trustee. The Trustee may resign at any time by giving at
least thirty (30) days' advance written notice to the
Company. In the case of resignation or removal of the Trustee
as provided above, or in the case of any other inability of
the Trustee to serve, a new trustee, which shall be
independent and not subject to control of the Company, shall
be appointed by the Board of Directors of the Company. Any
successor Trustee shall have the same powers and duties as
those conferred upon the Trustee hereunder and a new
agreement shall be entered into between the Company and the
new Trustee.
SECTION 10
AMENDMENT OR TERMINATION
(A) This Agreement may be amended at any time and to any
extent by a written instrument executed by the Company and
the Trustee, except to make the Trust revocable or to
adversely affect the interest of any Deferral Agreement
participant in funds held in his or her Trust Account.
(B) The Trust shall terminate on the date on which the
Company notifies the Trustee in writing that:
(i) all benefits due under the Deferral Agreements
have been paid by the Company to or on behalf of
all participants in the Deferral Agreements; or
(ii) that the Internal Revenue Service or the
Department of Labor has determined that the
Deferral Agreements are "funded" for ERISA
purposes.
(C) Upon termination of the Trust as provided in
paragraph (B) above, any assets remaining in the Trust Fund
shall be first used to pay any fees and expenses of the Trust
and the remainder shall be returned to the Company.
(D) The existence of the Trust shall not preclude the
Company from amending or terminating the Supplemental Pension
Plan or the Supplemental Deferred Compensation Policy (or
contracts entered into thereunder) or the Directors'
Retirement Program or the Supplemental Executive Plan;
provided, however, that the rights of any Deferral Agreement
participant in his or her respective Trust Account shall not
be adversely affected by such action.
SECTION 11
SEVERABILITY AND ALIENATION
(A) Any provision of this Agreement prohibited by law
shall be ineffective to the extent of any such prohibition
without invalidating the remaining provisions hereof.
(B) To the extent permitted by law, benefits to which any
person is entitled under the Deferral Agreements or the Trust
Fund may not be anticipated, assigned (either at law or in
equity), pledged or alienated and are not subject to
attachment, garnishment, levy, execution or other legal or
equitable process and no benefit actually paid to or on
behalf of such a person by the Trustee shall be subject to
any claim for repayment by the Company or the Trustee;
provided, however, that the Company or the Trustee may
make a claim for repayment of any amount paid in error.
SECTION 12
CONSTRUCTION
(A) This Agreement and the Trust shall be governed,
construed and administered in accordance with the laws of the
Commonwealth of Pennsylvania except to the extent preempted
by applicable federal law.
(B) This Agreement shall be binding upon and inure to the
benefit of the Company and its successors and assigns.
IN WITNESS WHEREOF, the Company and the Trustee have
caused this Agreement to be executed by their duly authorized
officers as of the date first written above.
ATTEST: EQUITABLE RESOURCES, INC.
_________________________ By _______________________
Corporate Secretary
Title ____________________
[Seal]
WITNESS: PITTSBURGH NATIONAL BANK
_________________________ By _______________________
Title ____________________
7/89
COMMONWEALTH OF PENNSYLVANIA )
) SS:
COUNTY OF ALLEGHENY )
On this ________ day of ______________, 1989, before me
personally came _______________________, to me known, who,
being duly sworn, did depose and say that he is the
_________________________ of the Company described in and
which executed the foregoing instrument; that he knows the
seal of said corporation; that the seal affixed to said
instrument is such corporate seal; and that he signed his
name thereto.
_________________________
Notary Public
My Commission Expires:
COMMONWEALTH OF PENNSYLVANIA )
) SS:
COUNTY OF ALLEGHENY )
On this ___________ day of __________________,1989,
before me personally came __________________________, to me
known, who, being duly sworn, did depose and say that he is
the _________________________ of the Trustee described in and
which executed the foregoing instrument; that he knows the
seal of said Trustee; that the seal affixed to said
instrument is such corporate seal; and that he signed his
name thereto.
_________________________
Notary Public
My Commission Expires:
7/89