EXHIBIT 10.25
ZIONS BANCORPORATION
DEFERRED COMPENSATION PLAN
TRUST AGREEMENT
This Agreement is made effective as of the 1st day of January, 2001, by and
between Zions Bancorporation (the Company) and Zions First National Bank, (the
"Trustee").
RECITALS:
A. The Company has established the Zions Bancorporation Deferred
Compensation Plan (the "Plan") to provide deferred compensation to eligible
employees of the Company and to eligible employees of those subsidiaries of the
Company who adopt the Plan (the Subsidiaries"). (Collectively the Company and
the adopting Subsidiaries are "Employers" and, individually, they may sometimes
be referred to as the "Employer").
B. The Employers have incurred or expect to incur liability under the terms
of the Plan with respect to the Executives of each Employer who participate in
the Plan (the "Plan Participants").
C. The Company, as grantor, wishes to establish a trust (hereinafter called
the "Trust"), and to contribute to the Trust assets that shall be held therein,
subject to the claims of the Company's and each Subsidiary's creditors in the
event of the Company's or a Subsidiary's Insolvency, as herein defined, until
paid to the Plan Participants in the manner and at the times as specified in the
Plan.
D. It the intention of the Company that this Trust shall constitute an
unfunded arrangement and shall not affect the status of the Plan as an unfunded
Plan maintained for the purpose of providing deferred compensation for select
management or highly compensated employees of the Employers as described in
Title I of the Employee Retirement Income Security Act of 1974.
E. It is the intention of the Company to make contributions to the Trust to
assist in fulfilling the obligations under the Plan to the Plan Participants,
the amount of which contributions shall be determined in accordance with the
terms of the Plan.
NOW THEREFORE the Company hereby establishes this Trust, which shall be
comprised, held and disposed of as follows:
Section 1. ESTABLISHMENT OF TRUST.
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(a) The Company herewith deposits with the Trustee in trust the sum of
$10.00, which will become the principal of the Trust to be held, administered
and disposed of by the Trustee as provided in this Trust Agreement. All
contributions received by the Trustee together with income thereon (the "Trust
Fund") shall be held, managed and administered by the Trustee pursuant to the
terms of the Trust.
(b) The Trust hereby established is revocable by the Company and each
Subsidiary as to itself and its employees. It shall become irrevocable upon a
Company Change of Control as defined herein.
(c) The Trust is intended to be a grantor trust, of which the Company is
the grantor within the meaning of subpart E, part I, subchapter J, chapter 1,
subtitle A of the Internal Revenue Code of 1986, as amended, and shall be
construed accordingly.
(d) The principal of the Trust and any earnings thereon shall be held
separate and apart from other funds of the Employers and shall be used
exclusively for the uses and purposes of the Employers, the Plan Participants
and general creditors of the Company and the Subsidiaries as herein set forth.
The Plan Participants and their beneficiaries shall have no preferred claim on,
or any beneficial ownership in, any assets of the Trust. Any rights created
under the Plan and this Trust Agreement shall be mere unsecured contractual
rights of the Plan Participants and their beneficiaries against their Employer.
Any assets held by the Trust will be subject to the claims of the Company's and
each Subsidiary's general creditors under federal and state law in the event of
Insolvency, as defined in Section 3(a) herein.
(e) The Company, in its sole discretion, and each Subsidiary (subject to
the discretion of the Company) may at any time, or from time to time, make
additional deposits of cash or other property in trust with the Trustee to
augment the principal to be held, administered and disposed of by the Trustee as
provided in this Trust Agreement. Deposits to the Trust by a Subsidiary may be
direct or indirect, as determined by the Company. Neither the Trustee nor any
Plan Participant or beneficiary shall have any right to compel additional
deposits and the Trustee shall have no duty or responsibility thereto.
Section 2. PAYMENTS TO PLAN PARTICIPANTS AND THEIR BENEFICIARIES.
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(a) The Company shall deliver to the Trustee a schedule (the "Payment
Schedule") that indicates the amounts payable in respect of a Plan Participant
(and his/her beneficiaries), that provides a formula or other instructions
acceptable to the 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, the Trustee shall make payments to a Plan Participant and
his/her beneficiaries in accordance with the Payment Schedule. The Trustee shall
not be liable for the proper application of any part of the Trust Fund and shall
not be liable for any distribution made in good faith without actual notice or
knowledge of the changed status or condition of any recipient. 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 subject Employer.
(b) The entitlement of a Plan Participant or his/her beneficiaries to
benefits under the Plan shall be determined by the Company or such party as it
shall designate under the Plan, and any claim for benefits shall be considered
and reviewed under the procedures set out in the Plan.
(c) An Employer may make payment of benefits directly to a Plan Participant
or his/her beneficiaries as they become due under the terms of the Plan. The
Employer shall notify the Trustee of its decision to make payment of benefits
directly prior to the time amounts are payable to a Plan Participant or his/her
beneficiaries. In addition, if an Employer elects to fund payments to a
Participant from the Trust and the principal of the Trust, and any earnings
thereon, are not sufficient to make payment in full of benefits due to the
Participant in accordance with the terms of the Plan, the Employer (of that
Participant) shall make the balance of each such payment as it falls due. The
Trustee shall notify the Employer where principal and earnings are not
sufficient.
Section 3. TRUSTEE RESPONSIBILITY REGARDING PAYMENTS TO TRUST
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BENEFICIARY WHEN AN EMPLOYER IS INSOLVENT.
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(a) The Trustee shall cease payment of benefits to all Participants and
beneficiaries who are or were employed by an Employer if that Employer is
Insolvent. An Employer shall be considered "Insolvent" for purposes of this
Trust Agreement if (i) the Employer is unable to pay its debts as they become
due, or (ii) the Employer is subject to a pending proceeding as a debtor under
the United States Bankruptcy Code.
(b) At all times during the continuance of this Trust, as provided in
Section 1(d) hereof, the principal and income of the Trust shall be subject to
claims of general creditors of each Employer under federal and state laws as set
forth below.
(1) The Board of Directors and the President of the Employer shall
have the duty to inform the Trustee in writing of the Employer's
Insolvency. If a person claiming to be a creditor of an Employer alleges in
writing to the Trustee that the Employer has become Insolvent, the Trustee
shall determine whether the Employer is Insolvent and, pending such
determination, the Trustee shall discontinue payment of benefits to all
Plan Participants and beneficiaries of that Employer.
(2) Notwithstanding the fact that the Trustee is a department within
or is a subsidiary of the Company or an Employer, unless the Trustee has
actual knowledge of an Employer's Insolvency, or has received notice from
the Employer or a person claiming to be a creditor alleging that an
Employer is Insolvent, the Trustee shall have no duty to inquire whether an
Employer is Insolvent. The Trustee may in all events rely on such evidence
concerning an Employer's solvency as may be furnished to the Trustee and
that provides the Trustee with a reasonable basis for making a
determination concerning an Employer's solvency.
(3) If at any time the Trustee has determined that an Employer is
Insolvent, the Trustee shall discontinue payments to all Plan Participants
and their beneficiaries and shall hold the assets of the Trust for the
benefit of the Employer's general creditors. Nothing in this Trust
Agreement shall in any way diminish any rights of any Plan Participant or
his/her beneficiaries to pursue their rights as general creditors of such
Employer with respect to benefits due under the Plan or otherwise.
(4) The Trustee shall resume the payment of benefits to Plan
Participants or their beneficiaries in accordance with Section 2 of this
Trust Agreement only after the Trustee has determined that the Employer is
not Insolvent (or is no longer Insolvent).
(c) Provided that there are sufficient assets, if the Trustee discontinues
the payment of benefits from the Trust pursuant to Section 3(b) hereof and
subsequently resumes payments, the first payment following discontinuance shall
include the aggregate amount of all payments due to a Plan Participant or
his/her beneficiaries under the terms of the Plan for the period of the
discontinuance, less the aggregate amount of any payments made to the Plan
Participants and their beneficiaries by the Employer in lieu of the payments
provided for hereunder during any period of discontinuance.
Section 4. PAYMENTS TO EMPLOYER.
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Except as provided in Section 3 hereof, after the Trust has become
irrevocable, no Employer shall have the right or power to direct the Trustee to
return to the Company or any Employer or divert to others any of the Trust
assets before all payment of benefits have been made to all Plan Participants
and their beneficiaries pursuant to the terms of the Plan.
Section 5. INVESTMENT AUTHORITY.
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(a) The Trustee may invest in securities (including stock or rights to
acquire stock) or obligations issued by the Company. All rights associated with
assets of the Trust shall be exercised by the Trustee or the person designated
by the Trustee, and shall in no event be exercisable by or rest with any Plan
Participant.
(b) The Company shall have the right at any time, and from time to time in
its sole discretion, to substitute assets of equal fair market value for any
asset held by the Trust. This right is exercisable by the Company in a
non-fiduciary capacity.
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.
Section 7. ACCOUNTING BY TRUSTEE.
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The Trustee shall keep accurate and detailed accounts of all investments,
receipts, disbursements and other transactions hereunder, and all accounts,
books and records relating thereto shall be open to inspection and audit at all
reasonable times by any person designated by the Company. Within 90 days after
the close of each fiscal year (or such other date as may be agreed upon in
writing between the Company and the Trustee), and within 120 days after the
effective date of the resignation of the Trustee as provided in Section 10
hereof, the Trustee shall deliver to the Company (who shall forward to each
Employer) 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 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 purchase or
sales (accrued interest paid or receivable being shown separately), and showing
all cash, securities, and other property held in the Trust at the end of such
year or as of the date of such removal or resignation, as the case may be.
Section 8. RESPONSIBILITY OF THE TRUSTEE.
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(a) The 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, the
Trustee shall incur no liability to any person for any action taken pursuant to
a direction, request or approval given by the Company which is contemplated by,
and in conformity with, the terms of the Plan or this Trust and is given in
writing by the Company. In the event of a dispute between the Company, an
Employer and/or another party, the Trustee may apply to a court of competent
jurisdiction to resolve the dispute.
(b) If the Trustee undertakes or defends any litigation arising in
connection with this Trust, the Company agrees to indemnify the Trustee against
the Trustee's costs, expenses and liabilities (including, without limitation,
attorneys fees and expenses) relating thereto and be primarily liable for such
payments. If the Company does not pay such costs, expenses and liabilities in a
reasonably timely manner, the Trustee may obtain payment from the Trust.
(c) The Trustee may consult with legal counsel (who may also be counsel for
the Company generally) with respect to any of its duties or obligations
hereunder.
(d) The 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) The 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,
the 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 the provisions of Section 8(e), the Trustee may loan to
the Company the proceeds of any borrowing against an insurance policy held as an
asset of the Trust.
(g) Notwithstanding any powers granted to the Trustee pursuant to this
Trust Agreement or to applicable law, the 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 Procedure and
Administrative Regulations promulgated pursuant to the Internal Revenue Code.
Section 9. COMPENSATION AND EXPENSES OF THE TRUSTEE.
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The 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 OR REMOVAL OF THE TRUSTEE.
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(a) The Trustee may resign at any time by written notice to the Company
which shall be effective twenty (20) days after receipt of such notice unless
the Company and the Trustee agree otherwise.
(b) Except as set forth in Section 10 (c), a Trustee may be removed by the
Company on twenty (20) days notice or upon shorter notice accepted by the
Trustee.
(c) Upon a Change of Control, as defined herein, the Trustee shall appoint
an independent third party as successor Trustee. The appointment of a successor
Trustee shall be effective when accepted in writing by the new Trustee. The new
Trustee 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 the successor Trustee to
evidence the transfer.
(d) If the successor Trustee appointed pursuant to subpart 10 (c) above
resigns within 5 years of a Change of Control, as defined herein, the Company
shall apply to a court of competent jurisdiction for the appointment of a
successor Trustee or for instructions.
(e) Upon resignation or removal of the Trustee and appointment of the
successor Trustee, all assets shall subsequently be transferred to the successor
Trustee. The transfer shall be completed within thirty (30) days after receipt
of notice of resignation, removal or transfer, unless the Company extends the
time limit.
(f) If a Trustee resigns or is removed, or otherwise fails or ceases to
serve, a successor shall be appointed, in accordance with Section 11 hereof, by
the effective date of the resignation or removal under paragraphs (a) or (b) of
this section. If no such appointment has been made, the Trustee may apply to a
court of competent jurisdiction for appointment of a successor or for
instructions. All expenses of the 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 a Trustee resigns or is removed in accordance with Section 10(a) or
(b) hereof, or otherwise fails or ceases to serve, the Company may appoint a
third party as a successor Trustee. The appointment shall be effective when
accepted in writing by the new Trustee, who shall have all 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
the Company or the successor Trustee to evidence the transfer.
(b) If a Trustee resigns or is removed pursuant to the provisions of
Section 10(d) hereof or otherwise ceases or fails to serve, the previous Trustee
may appoint any third party as successor Trustee. The appointment of a successor
Trustee shall be effective when accepted in writing by the new Trustee. The new
Trustee 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 the successor Trustee to
evidence the transfer.
(c) 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
Section 7 and 8 hereof. The successor Trustee shall not be responsible for and
the 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.
Section 12. AMENDMENT OR TERMINATION.
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(a) This Trust Agreement may be amended by a written instrument executed by
Trustee and the 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. Actions of the
Trustee may be evidenced by a written instrument signed by the Trustee, and all
third parties shall be entitled to rely on such written instrument.
(b) The Trust shall not terminate until the date on which all Plan
Participants and their beneficiaries are no longer entitled to benefits pursuant
to the terms of the Plan unless sooner revoked in accordance with Section 1(b)
hereof. Upon termination of the Trust, any assets remaining in the Trust shall
be returned to the 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 Utah.
(d) For purposes of this Trust, Change of Control shall mean the purchase
or other acquisition by any person, entity or group of persons, within the
meaning of Section 13(b) or 14(d) of the Securities Exchange Act of 1934 (the
"Act"), or any comparable successor provisions, a beneficial ownership (within
the meaning of Rule 13d-3 promulgated under the Act) of thirty percent (30%) or
more of the outstanding shares of common stock or the combined voting power of
the Company's then outstanding voting securities entitled to vote generally, or
the approval by the stockholders of the Company or a reorganization, merger, or
consolidation, in each case, with respect to which persons who are stockholders
of the Company immediately prior to such reorganization, merger or consolidation
do not, immediately thereafter, own more than fifty percent (50%) of the
combined voting power entitled to vote generally in the election of directors of
the reorganized, merged or consolidated Company's then outstanding securities,
or a liquidation or dissolution of the Company or the sale of all or
substantially all of the Company's assets.
Section 14. EFFECTIVE DATE.
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The effective date of this Trust Agreement shall be January 1, 2001.
IN WITNESS WHEREOF the Company and the Trustee have executed this
Agreement.
"COMPANY"
ZIONS BANCORPORATION
By:__________________________
Its: ________________________
"TRUSTEE"
ZIONS FIRST NATIONAL BANK
By:___________________________
Its:__________________________