EXHIBIT (10)k
TRUST UNDER HACH COMPANY
DEFERRED COMPENSATION PLAN
(a) This Agreement made this 10th day of April by
and between Hach Company (Company) and Dauphin Deposit Bank
and Trust Company (Trustee);
(b) WHEREAS, Company has adopted a nonqualified plan, the Hach
Company Deferred Compensation Plan (Plan);
(c) WHEREAS, Company has incurred or expects to incur liability
under the terms of such Plan with respect to the individuals
participating in such Plan;
(d) WHEREAS, Company wishes to establish a trust (hereinafter
called "Trust") and to contribute to the Trust assets that
shall be held therein, subject to the claims of Company's
Insolvency, as herein defined, until paid to Plan
participants and their beneficiaries in such manner and at
such times as specified in the Plan;
(e) 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 maintained
for the purpose of providing deferred compensation for a
select group of management or highly compensated employees
for purposes of Title I of the Employee Retirement Income
Security Act of 1974;
(f) WHEREAS, it is the intention of Company to make
contributions to the Trust to provide itself with a source
of funds to assist it in the meeting of its liabilities
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.
(a) Company hereby deposits with Trustee in trust $1.00, which
shall become the principal of the Trust to be held,
1
administered and disposed of by Trustee as provided in this
Trust Agreement.
(b) The Trust shall become irrevocable upon approval by the
Board of Directors.
(c) The Trust is intended to be a grantor trust, of which
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 Company and
shall be used exclusively for the uses and purposes of Plan
participants and general creditors as herein set forth.
Plan participants and their beneficiaries shall have no
preferred claim on, or any beneficiary 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 against Company. Any assets held by the Trust
will be subject to the claims of Company's general creditors
under federal and state law in the event of Insolvency, as
defined in Section 3(a) herein.
(e) Company, in its sole discretion, may at any time, or from
time to time, 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. Neither Trustee nor any Plan
participant or beneficiary shall have any right to compel
such additional deposits.
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
2
make provision for the reporting and withholding of any
federal 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 Company. The Plan
participants or their beneficiaries, if applicable, shall be
responsible for the reporting and payment of any state or
local taxes that may be due to the appropriate taxing
authorities with respect to the payment of benefits pursuant
to the terms of the Plan.
(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 under the
Plan, and any claim for such benefits shall be considered
and reviewed under the procedures set out in the Plan.
(c) 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 payments 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 COMPANY IS INSOLVENT.
(a) Trustee shall cease payment of benefits to Plan participants
and their beneficiaries if the Company is Insolvent.
Company shall be considered "Insolvent" for purposes of this
Trust Agreement if
(i) Company is unable to pay its debts as they become
due, or
(ii) Company 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
Company under federal and state law as set forth below:
3
(i) The Board of Directors and the Chief Executive
Officer of Company shall have the duty to inform
Trustee in writing of Company's Insolvency. If a
person claiming to be a creditor of Company
alleges in writing to Trustee that Company has
become Insolvent, Trustee shall determine
whether Company is Insolvent and, pending such
determination, Trustee shall discontinue payment
of benefits to Plan participants or their
beneficiaries.
(ii) Unless Trustee has actual knowledge of Company's
Insolvency, or has received notice from Company
or a person claiming to be a creditor alleging
that Company is Insolvent, Trustee shall have
no duty to inquire whether Company is Insolvent.
Trustee may in all events rely on such evidence
concerning Company's solvency as may be furnished
to Trustee and that provides Trustee with a
reasonable basis for making a determination
concerning Company's solvency.
(iii) If at any time Trustee has determined that
Company is Insolvent, Trustee shall discontinue
payments to Plan participants or their
beneficiaries and shall hold the assets of the
Trust for the benefit of Company's general
creditors. Nothing in this Trust Agreement
shall in any way diminish any rights of such
general creditors with respect to benefits due
under the Plan or otherwise.
(iv) Trustee shall resume the payment of benefits
to Plan participants or their beneficiaries in
accordance with Section 2 of this Trust Agreement
only after Trustee has determined that Company is
not Insolvent (or is no longer Insolvent).
(c) Provided that there are sufficient assets, if Trustee
discontinues the payment of benefits from the Trust 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
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 Plan participants
or their beneficiaries by Company in lieu of the payments
provided for hereunder during any such period of
discontinuance.
4
SECTION 4.
PAYMENTS TO COMPANY.
Except as provided in Section 3 hereof, after the Trust has
become irrevocable, Company shall have no right or power to
direct Trustee to return to Company or to divert to 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.
SECTION 5.
INVESTMENT AUTHORITY.
(a) The Trustees shall invest the principal of the Trust and any
earnings thereon in accordance with written directions from
Company. Such directions shall provide Trustee with the
investment discretion to invest the above-referenced amounts
within broad guidelines established by Trustee and Company
and set forth therein.
(b) Subject to Subsection (a), the Trustee may
(i) invest and reinvest the amounts described in
Subsection (a) in any form of property not
prohibited by law, including, without limitation
on the amount which may be invested therein,
any mutual funds, money market funds,
certificates of deposit, life insurance policies,
annuity contracts, and other deposits yielding
a reasonable rate of interest; and
(ii) hold cash uninvested in an amount considered
necessary and prudent for proper administration
of the Trust, or deposit the same with any
banking, savings or similar financial institution
supervised by the United States or any state,
including the Trustee's own banking department.
(c) Notwithstanding the foregoing, in no event may Trustee
invest in securities (including stock or rights to acquire
stock) or obligations issued by Company, other than a de
minimis amount held in common investment vehicles in which
Trustee invests. All rights associated with assets of the
Trust shall be exercised by Trustee or the person designated
by Trustee, and shall in no event be exercisable by or rest
with Plan participants.
5
Subject to the limitation described in the preceding
paragraph, Company shall have the right, at anytime, and
from time to time in its sole discretion, to substitute
assets of equal fair market value for any asset held by the
Trust, provided such substitute assets are acceptable to the
Trustee.
SECTION 6.
DISPOSITION OF INCOME.
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.
Trustee shall keep accurate and detailed records of all
investments, receipts, disbursements, and all other transactions
required to be made, including such specific records as shall be
agreed upon in writing between Company and Trustee. Within 90
days following the close of each calendar year and within 90 days
after the removal or resignation of Trustee, Trustee shall
deliver to 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 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 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 TRUSTEE.
(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 Company which is contemplated by, and in conformity
with, the terms of the Plan or this Trust and is given in
writing by Company. In the
6
event of a dispute between Company 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, Company agrees to indemnify
Trustee against Trustee's cost, expenses and liabilities
(including, without limitation, attorneys' fees and
expenses) relating thereto and to be primarily liable for
such payments. If 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 Company 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) However, notwithstanding the provisions of Section 8(e)
above, Trustee may loan to Company the proceeds of any
borrowing against an insurance policy held as an asset of
the Trust.
(g) 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 Procedure
and Administrative Regulations promulgated pursuant to the
Internal Revenue Code.
7
SECTION 9.
COMPENSATION AND EXPENSES OF TRUSTEE.
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.
(a) Trustee may resign at any time by written notice to Company,
which shall be effective 90 days after receipt of such
notice unless Company and Trustee agree otherwise.
(b) Trustee may be removed by Company on 90 days notice or upon
shorter notice accepted by Trustee.
(c) Upon a Change of Control, as defined herein, Trustee may not
be removed by Company for one year.
(d) If Trustee resigns within one year after a Change of
Control, as defined herein, Company shall apply to a court
of competent jurisdiction for the appointment of successor
Trustee or for instructions.
(e) 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 90 days after receipt of notice of
resignation, removal or transfer, unless Company extends the
time limit.
(g) 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.
8
SECTION 11.
APPOINTMENT OF SUCCESSOR.
(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 be
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.
SECTION 12.
AMENDMENT OR TERMINATION.
(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 benefit payments under the Plan have been made. All
assets in the Trust at termination shall be returned to
Company.
9
(d) This Trust Agreement may not be amended by Company for one
year following a Change of Control, as defined herein.
SECTION 13.
MISCELLANEOUS.
(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 Commonwealth of
Pennsylvania.
(d) For purposes of this Trust, "Change of Control" shall mean a
change in control of a nature that would be required to be
reported in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the Securities Act of 1934.
SECTION 14.
EFFECTIVE DATE.
The effective date of this Trust Agreement shall be
March 1, 1995.
IN WITNESS WHEREOF, Company and Trustee have executed this
Agreement as of the date first above written.
HACH COMPANY
By: /s/ Bruce J. Hach
______________________________
President
ATTEST:
/s/ Mary A. McCray
_______________________________
Asst. Secretary
DAUPHIN DEPOSIT BANK
AND TRUST COMPANY
By: /s/ Robin Lake Becker
______________________________
Asst. Vice President
ATTEST:
/s/ Bernard Kelly, Jr.
_______________________________
Assistant Secretary