Exhibit 10.68
BROWN & WILLIAMSON TOBACCO CORPORATION
TRUST AGREEMENT
FOR
_____________________
THIS AGREEMENT amends and restates in its entirety that certain trust
agreement (the "Agreement") made as of the ___ day of _______________, 19____,
by and among ______________________ (the "Executive"), STATE STREET BANK AND
TRUST COMPANY, a trust company organized under the laws of Massachusetts (the
"Trustee"), and BROWN & WILLIAMSON TOBACCO CORPORATION, a Delaware corporation,
as administrative agent for the Executive (the "Company"),
WITNESSETH:
WHEREAS, the Company has incurred and expects to continue to incur
certain retirement income liabilities to or with respect to the Executive
pursuant to the terms of the Company's Supplemental Retirement Plan (referred to
herein as the "Plan"); and
WHEREAS, the Company desires to provide additional assurance to the
Executive that his rights under the Plan will in the future be met by
application of the procedures set forth herein; and
WHEREAS, the Executive desires to establish with the Trustee a trust,
the principal of which is intended to be contributed by the Company to provide a
source of payment for benefits payable to the Executive under the terms of the
Plan; and
WHEREAS, the Executive desires further to establish a trust facility
through which certain incentive and other compensation and benefits paid by the
Company may be held, invested and distributed by a corporate trustee;
NOW, THEREFORE, in consideration of the premises and mutual and
independent promises herein made, the parties hereto covenant and agree as
follows:
ARTICLE 1.
TRUST FUND
1.1 The Executive hereby establishes with the Trustee a Trust
consisting of such sums of money and such property acceptable to the Trustee as
shall from time to time be paid or delivered to the Trustee by the Company, and
the earnings and profits thereon. All such money and property, all investments
made therewith and proceeds thereof, less the payments or other distributions
which, at the time of reference, shall have been made by the Trustee, as
authorized herein (the "Fund"), shall be held by the Trustee, IN TRUST, in
accordance with the provisions of this Agreement.
1.2 The Trustee shall hold, manage, invest and otherwise administer
the Fund pursuant to the terms of this Agreement. The Trustee shall be
responsible only for contributions
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actually received by it hereunder and shall have no responsibility for the
correctness of the amount thereof.
1.3 Upon the establishment of this Trust, and from time to time
thereafter, the Company may contribute to the Trust such amount in cash as the
Company determines to be appropriate to (i) provide a source of funds for
payments required under the terms of the Plan, in the manner set forth in
Article 3 below, provided that the Company shall, at its expense, retain
independent actuarial services to calculate such amounts, and (ii) provide a
source of funds for the payment of certain other compensation and benefits to
the Executive, as set forth herein.
1.4 The Company shall certify to the Trustee and the Executive at the
time of each contribution to the Trust the amount of such contribution being
made in respect of the Executive's SERP Account, and in respect of each other
benefit or Account for which a contribution or deposit may be made.
1.5 The Fund shall be revalued by the Trustee quarterly as of the last
business day of each March, June, September and December, or at such other times
as agreed to by the Company and the Trustee, at current market values, as
determined by the Trustee (or, with respect to the RREA, as determined by the
Company or its agent, as applicable). The Trustee shall deliver a report of each
such valuation, not later than thirty (30) days after the end of each such
valuation, to the Executive with a copy to the Company.
1.6 The Trust shall be solely for the purpose of providing a source of
payment for (i) amounts due under the Plan with respect to the Executive, and
(ii) any other amounts of compensation or benefits specifically funded under the
Trust. The Company shall have no legal or equitable right, title or interest,
either actual or contingent, in or to the Trust, and the Trust shall not
constitute the legal or equitable property of the Company. The Company shall not
have the right or ability to transfer, pledge, convey, hypothecate or grant,
either outright or as security, any interest in the Trust or the Trust Fund;
provided, however, that in the event of the commencement of a bankruptcy case or
cases wherein the Company is the debtor, the Trust shall not constitute property
of the debtor's estate within the meaning of 11 U.S.C. Section 541, or any
similar provision. The Trustee shall be in sole possession of the Trust and will
act solely and exclusively as a Trustee hereunder and not as an agent for the
Company. Accordingly, no creditor of the Company shall have any right to have or
to hold the Trust in satisfaction of any claim or as collateral for any
obligation, and shall not be able to obtain a security interest in the Trust.
The Executive hereby appoints the Trustee as its Trustee to take possession and
custody, solely and exclusively on behalf of the Executive, of the Trust Fund.
ARTICLE 2.
ADMINISTRATIVE PROVISIONS
2.1 The Company shall act as Administrator of the Trust, as an agent
of the Executive; provided that nothing in the acceptance of such duties, or in
the act of making contributions to the Trust, is intended, nor shall be
construed to be or constitute the establishment or maintenance of an employee
benefit plan or plans as such terms are defined by Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended, or any regulations
promulgated thereunder. Except for the records dealing solely with the Fund and
its investment,
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which shall be maintained by the Trustee, the Company as Administrator shall
maintain all the Executive's records contemplated by this Agreement, including
records of the Executive's compensation and benefits provided by the Company,
the amount of benefits accrued under the Plan or under any other
Company-provided benefit funded hereunder, the Company's contributions to the
Trust, withdrawals from the Fund by the Executive, as provided in this
Agreement, the Executive's beneficiary designation, and such other records as
may be necessary for determining the amount payable to the Executive or
Surviving Spouse or other beneficiary under the Plan (or other Company-provided
benefit funded hereunder, if applicable). All such records shall be made
available to Executive or the delegate of the Executive, promptly upon request
by the Executive. The Company shall give written notice to the Trustee of the
Executive's termination of employment, and as to whether such termination is by
reason of death, disability, termination or retirement prior to age 55, or
retirement at or after age 55. The Company as Administrator shall also perform
such other duties and responsibilities in connection with the administration of
the Trust as the Company or the Trustee determines is necessary or advisable to
achieve the objectives of this Agreement.
2.2 The Company shall have full responsibility for the proper
remittance of all withholding taxes on contributions by the Company to the Trust
to the appropriate taxing authority and shall furnish the Executive with the
appropriate tax information form reporting the amounts of such contributions and
any withholding taxes. The Trustee shall have the responsibility for the
preparation and filing with the appropriate taxing authorities of all tax
returns required to be filed for the Trust, and shall furnish the Executive with
the appropriate tax information form or forms required by taxing authorities.
2.3 The Executive may designate a beneficiary to receive all or any
portion of the Fund (or separate account within the Fund, as applicable) in the
event of his death. Such designation shall be in writing filed with the Company
on a form approved by the Company and signed by the Executive. The Company shall
promptly notify the Trustee of any such beneficiary designation and any changes
therein.
2.4 After the execution of this Agreement, the Company shall promptly
file with the Trustee a certified list of the names and specimen signatures of
the officers or other employees or agents authorized to act for it. The Company
shall promptly notify the Trustee of the addition or deletion of any person's
name to or from such list, respectively. Until receipt by the Trustee of notice
that any person is no longer authorized so to act, the Trustee may continue to
rely on the authority of the person. All certifications, notices and directions
by any such person or persons to the Trustee shall be in writing signed by such
person or persons. The Trustee may rely on any such certification, notice or
direction purporting to have been signed by or on behalf of such person or
persons that the Trustee believes to have been signed thereby. The Trustee may
rely on any certification, notice or direction of the Company that the Trustee
believes to have been signed by a duly authorized officer or agent of the
Company. The Trustee shall have no responsibility for acting or not acting in
reliance upon any notification believed by the Trustee to have been so signed by
a duly authorized officer, employee or agent of the Company. The Company shall
be responsible for keeping accurate books and records with respect to the
Executive, his compensation and his rights and interests in the Fund under the
Plan.
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ARTICLE 3.
SERP ACCOUNT
3.1 There is hereby established within the Fund a separate account for
amounts payable under the Plan, to be referred to as the "SERP Account."
3.2 (a) The initial deposit to the SERP Account, which may be paid on
a time schedule determined by the Company in its sole discretion, shall be
in an amount equal to the Executive's "Estimated Projected Benefit" (after
adjustment pursuant to subsection (b) below). The Estimated Projected
Benefit is the Executive's SERP benefit projected to age fifty-five (55)
(or actual age, if greater at the time of determination), and then prorated
based on actual Service divided by Service projected to age fifty-five
(55). Assumptions necessary to make such projection shall be determined by
the Company in its sole discretion, as set forth in written administrative
rules established by the Company from time to time. The Company may
thereafter make additional annual deposits to the SERP Account (or as
directed by the Executive, if the Executive's SERP Account has previously
been withdrawn) equal in amount to the difference, if any, between the
Estimated Projected Benefit determined at the end of the applicable
calendar year and the Estimated Projected Benefit determined at the end of
the previous calendar year end; provided that deposits made to the SERP
Account or paid on or after the Executive attains age fifty-five (55) shall
be based on the incremental SERP benefit earned for the period for which
the deposit or payment is being made. The Company shall in all events
reimburse the Executive for the estimated income and other taxes due on
each such contribution or payment. If the SERP Account has been totally
withdrawn, as provided in Section 3.5, such additional amounts shall be
deposited to a separate trust account designated by the Executive, or if no
designation is made, paid to the Executive.
(b) Company deposits made under this Article 3 shall in all events be
made on an after-tax basis, and shall be discounted to the Executive's age
at the time a deposit amount is determined, using an interest rate
substantially equal to the after-tax earnings rate of the Tax-Exempt Bond
Fund. The term "after-tax basis" means the applicable Company deposit net
of the taxes that would be payable thereon if the Executive had retired at
the time of deposit, by applying Federal and State marginal tax rates
applicable to the Executive at the time of deposit, but by assuming
Executive's sole source of income to be the projected tax qualified and
non-tax qualified Company-provided pension benefits.
3.3 (a) The Company may also make a final deposit to the SERP Account
(or as directed by the Executive, if the Executive's SERP Account has
previously been withdrawn) as soon as practicable after the Executive's
termination of employment for any reason, equal to the difference between:
(1) the Executive's actual after-tax benefit due under the Plan
accrued through the date of the Executive's retirement (the "Actual
Benefit"), or, if the termination of employment is by reason of the
Executive's disability, death or termination of employment for any
other reason, the Actual Benefit accrued as of the time of such event
based on actual age and Service at such time (except in the
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case of disability or death, in which Service is projected to age 65),
reduced by the amount of any withdrawals from the SERP Account by the
Executive as provided in Section 3.5 (increased by the income that
would have been earned on such withdrawn amounts from the time of
withdrawal until the time of the Executive's termination of employment
at the actual after-tax earnings rate of the Tax-Exempt Bond Fund);
and
(2) actual Company deposits to the SERP Account (increased by
earnings equal to the actual after-tax earnings rate of the Tax-Exempt
Bond Fund (the "Notional Account"), reduced by the amount of any
withdrawals from the SERP Account by the Executive as provided in
Section 3.5 (increased by the income that would have been earned on
such withdrawn amounts from the time of withdrawal until the time of
the Executive's termination of employment at the actual after-tax
earnings rate of the Tax-Exempt Bond Fund).
For purposes of this Section 3.3(a), the after-tax basis of the Actual
Benefit shall be calculated by adjusting the marginal tax rate factor used
for each prior deposit made pursuant to Section 3.2 to the Federal and
State marginal tax rate applicable to the Executive at the date of
retirement or other event triggering a final deposit or payment, and by
assuming Executive's sole source of income to be the actual tax qualified
and non-tax qualified Company provided pension benefits.
If the SERP Account has been totally withdrawn, as provided in Section 3.5,
such additional amount shall be deposited to a separate trust account
designated by the Executive, or if no designation is made, shall be paid
directly to the Executive.
(b) The Executive agrees that if the Notional Account is greater than
the Actual Benefit accrued at such determination date, the Executive will
refund to the Company a cash amount equal to such difference as soon as
practicable after the calculation thereof (including, in the event of the
Executive's death, any portion of the Actual Benefit in excess of the
amount due to a surviving spouse or dependent under the Plan, or if there
is no surviving spouse or dependent, the entire Actual Benefit). Such
amount shall be, and the Executive acknowledges that such amount is, a lien
on the Trust (if then in full force and effect) until paid in full. Any
such refund shall be deemed to have been derived from the most recent
contributions deposited to the SERP Account (or paid to the Executive, if
there is no SERP Account at the time of such contributions).
3.4 In the event the actual SERP Account balance, after the final
deposit or payment provided by Section 3.3 (if any), is less than the Notional
Account balance at the time the Actual Benefit is determined, or if the
Executive has withdrawn all or any part of the SERP Account pursuant to Section
3.5, neither the Trustee nor the Company assumes any responsibility to the
Executive for the difference between the actual SERP Account balance (if any)
and the Actual Benefit.
3.5 The Executive may, upon written notice of the amount of withdrawal
to the Trustee, withdraw all or any portion of the SERP Account, inclusive of
earnings thereon, at any time. The Executive may also direct the Trustee to
transfer the balance of the SERP
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Account to a trust (or similar custodial arrangement) designated by the
Executive, in Executive's sole discretion. Prior to any such withdrawal, the
Trustee shall notify the Company in writing of such withdrawal and the amount
thereof.
ARTICLE 4.
OTHER ACCOUNTS
4.1 A "Retiree Health Care Account" ("RHCA") may be established for
the sole purpose of providing Executive a source of funds through which health
care coverage may be purchased by the Trustee for the benefit of the Executive
and eligible dependents as defined by the Brown & Williamson Tobacco Corporation
Health Care Plan for Salaried Employees (the "Health Care Plan") upon
Executive's retirement from the Company ("retiree health coverage"). If
established, the RHCA shall be administered as follows:
(a) Amounts necessary to pay the actuarially projected cost of retiree
health coverage may be deposited to the RHCA by the Company, and any
amounts so deposited shall be invested in such manner as the Company, as
agent for the Executive, reasonably determines will satisfy the
actuarially-projected cost of such retiree health coverage, including
without limitation the purchase of insurance on the life of the Executive
that provides an inside buildup to the owner. The Company, at its expense,
shall retain a qualified, independent actuary to calculate such projected
costs. Amounts held, invested and reinvested under the RHCA shall
constitute a separate account and shall not be considered to be part of the
SERP Account for any purposes related to the Plan.
(b) To the extent the Company deposits any such amount to the RHCA,
the Executive may elect, for a period of thirty (30) days after deposit, to
withdraw such deposit from the RHCA for any use or purpose; provided that
after such thirty (30) day period expires, such deposit (inclusive of any
earnings thereon) shall in all events be subject to the terms and
conditions of this Section 4.1, and may not be withdrawn from the RHCA by
the Executive or used for any purpose other than the purchase of retiree
health coverage for the Executive and eligible dependents from the Health
Care Plan, as provided in paragraph (3) of this Section 4.1. In the event
any such funds are withdrawn by Executive during such thirty (30) day
period, no further or additional deposits to the RHCA shall or may be made
by the Company.
(c) The Trustee shall pay, from the current and accumulated principal
and interest of the RHCA, the participant share of the premium cost of
retiree health coverage applicable to the Executive and eligible dependents
under the Health Care Plan at the time of retirement, and as adjusted from
year to year thereafter. Such payment shall be made monthly to the Health
Care Plan, or its designated agent, except as otherwise agreed by the
Health Care Plan.
(d) The Company, in its sole discretion, may appoint an agent for the
purpose of managing and administering the RHCA, including without
limitation the administration of any contracts of insurance held in the
RHCA. The agent appointed by the Company shall have power and authority to
direct the Trustee with respect to the management and maintenance of any
such insurance contracts, the payment of the
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premium cost of retiree health coverage through withdrawals or loans from
such insurance contracts, and to engage in any other act necessary or
advisable to fulfil its duties hereunder, and the Trustee may rely on such
directions without further inquiry.
(e) Upon the death of the Executive, the Trustee shall collect any
death benefit owing to the Trust from any insurance contract purchased
pursuant to paragraph (1) above, and shall hold, manage, invest and
reinvest the proceeds (together of any other funds then held in the RHCA),
and make distributions therefrom for the purposes and upon the terms and
conditions set forth in paragraph (3) above for as long as there remains
living an eligible dependent of the Executive. Upon the death of the
Executive and eligible dependents, the balance of the RHCA (inclusive of
any such death benefits and other funds then held in the RHCA) shall be
paid to the trustee of the "Brown & Williamson Tobacco Corporation Trust
Agreement for Noncollectively Bargained Postretirement Healthcare
Benefits", and to the trustee's successor or successors in trust, for its
general purposes.
(f) In the event Executive terminates employment prior to becoming
eligible for retiree health coverage as a Retired Participant (as defined
by the Health Care Plan), no further deposits shall be made to the RHCA,
and the insurance contract shall be terminated effective the date of
Executive's employment termination. The proceeds of such terminated
insurance contract (together with any other funds then held in the RHCA)
shall thereupon be paid to the trustee of the "Brown & Williamson Tobacco
Corporation Trust Agreement for Noncollectively Bargained Postretirement
Healthcare Benefits", and to the trustee's successor or successors in
trust, for its general purposes.
4.2 The Executive may elect, in accordance with administrative rules
established by the Company, to establish an "Incentive Award Account" ("IAA").
The IAA shall constitute a separate account solely for the purpose of holding,
managing, investing, reinvesting and distributing incentive award payments made
by the Company to or for the benefit of the Executive from time to time. Amounts
held in the IAA shall be invested pursuant to Section 5.2(b). The Executive may
direct the Trustee to distribute the balance of the IAA, or any portion thereof
(inclusive of principal and earnings), to the Executive at any time and from
time to time. Upon the death of Executive, the Trustee shall distribute the
balance of the IAA pursuant to a written beneficiary form on file with the
Company as Administrator of the Trust, or if none, to the Executive's spouse,
issue (per stirpes), or estate, in that order. To the extent any provision of
this Section 4.2 is inconsistent with any other term or condition of the Trust,
the provision of this Section 4.2 shall prevail.
ARTICLE 5.
INVESTMENT OF FUND
5.1 The Trustee shall not be liable in discharging its duties
hereunder, including without limitation its duty to invest and reinvest the
Fund, if it acts in good faith and in accordance with the terms of this
Agreement, including, without limitation, the making of any investment directed
by the Executive, the Company or any agent authorized to act for it, or any
investment manager other than the Trustee, and any applicable federal or state
laws, rules or regulations.
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5.2 (a) The Trustee is hereby appointed as the investment manager of
the Fund. In the event that the Trustee cannot serve as investment manager
of the Fund, the Trustee shall then select a substitute investment manager
reasonably agreeable to the Company.
(b) Except as provided in Section 4.1 and subsection (c) of this
Section 5.2, the Fund shall be invested solely in a U.S. tax-exempt
intermediate term bond fund (the "Tax-Exempt Bond Fund") agreeable to the
Company, and consistent with written administrative rules established by
the Company from time to time, except to the extent the Executive elects to
invest in one or more diversified fixed or equity or combined funds offered
from time to time by the Trustee. Any such election shall be made by the
Executive by written notice filed with the Company, and the Company shall
thereupon promptly notify the Trustee of the election. The Trustee shall
have no liability for any such election, except for the proper
administration thereof. The Executive may change such election at any time
by written notice filed with the Company. Investment election changes shall
be implemented by the Trustee as soon as practicable after notification of
such election change by the Company. Investment election changes shall
apply equally to the then current balance of the applicable account and to
future contributions.
(c) The Executive may direct the Trustee, in accordance with
administrative rules established by the Company, to invest a portion of the
SERP Account in a "Retirement Real Estate Account" ("RREA"). The RREA shall
be a separate account established solely for the purpose of acquiring
residential real estate (and furnishings) intended, at the time of
acquisition, for the benefit and use of the Executive upon retirement from
the Company. No more than one (1) residence may be acquired through the
RREA, and no more than fifty percent (50%) of the total balance of the SERP
Account at the time of transfer to the RREA may be allocated to the RREA.
The Company, in its sole discretion, may establish rules and guidelines for
the acquisition of property under the RREA, and may appoint an agent for
the purpose of acquiring, managing, maintaining and disposing of the
property. The agent appointed by the Company shall have power and authority
to direct the Trustee with respect to the acquisition, management,
maintenance and disposition of the property, and the Trustee shall have no
duty for appraising or inspecting the property (including without
limitation any duty to assess the property for environmental damage or to
provide for the mitigation thereof), or for the management and maintenance
thereof, and the Trustee may rely on such directions by the Company or its
agent without further inquiry.
5.3 Subject to the investment restrictions set forth in Section 5.2
above, the Trustee shall have the power and right:
(a) To receive and hold all contributions made to it by the Company;
(b) To invest and reinvest all or any portion of the Fund collectively
through the medium of any common, collective, commingled trust or mutual
fund that may be established, maintained or advised by the Trustee or any
affiliate thereof, subject to the instrument or instruments establishing
such trust fund or funds and with the terms of such instrument or
instruments, as from time to time amended, being incorporated into this
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Agreement to the extent of the equitable share of the Fund in any such
common, collective, commingled trust or mutual fund;
(c) To participate in and use a book-entry system for the deposit and
transfer of securities;
(d) To sell or exchange any property held by it at public or private
sale, for cash or on credit, to grant and exercise options for the purchase
or exchange thereof, to exercise all conversion or subscription rights
pertaining to any such property and to enter into any covenant or agreement
to purchase any property in the future;
(e) To participate in any plan of reorganization, consolidation,
merger, combination, liquidation or other similar plan relating to property
held by it and to consent to or oppose any such plan or any action
thereunder or any contract, lease, mortgage, purchase, sale or other action
by any person;
(f) To deposit any property held by it with any protective,
reorganization or similar committee, to delegate discretionary power
thereto, and to pay part of the expenses and compensation thereof and any
assessments levied with respect to any such property so deposited;
(g) To extend the time of payment of any obligation held by it;
(h) To hold uninvested any moneys received by it, without liability
for interest thereon, until such moneys shall be invested, reinvested or
disbursed;
(i) To exercise all voting or other rights with respect to any
property held by it and to grant proxies, discretionary or otherwise;
(j) For the purposes of the Trust, to borrow money from others,
including the Trustee, to issue its promissory note or notes therefor, and
to secure the repayment thereof by pledging any property held by it;
(k) To furnish the Company and the Executive with such information as
may be needed for tax or other purposes;
(l) To employ suitable agents and counsel, who may be counsel to the
Company or the Trustee, and to pay their reasonable expenses and
compensation from the Fund to the extent not paid by the Company;
(m) To cause any property held by it to be registered and held in the
name of one or more nominees, with or without the addition of words
indicating that such securities are held in a fiduciary capacity, and to
hold securities in bearer form;
(n) To settle, compromise or submit to arbitration any claims, debts
or damages due or owing to or from the Trust, respectively, to commence or
defend suits or legal proceedings to protect any interest of the Trust, and
to represent the Trust in all suits or legal proceedings in any court or
before any other body or tribunal; provided, however,
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that the Trustee shall not be required to take any such action unless it
shall have been indemnified by the Company to its reasonable satisfaction
against liability or expenses it might incur therefrom;
(o) To organize under the laws of any state a corporation or trust for
the purpose of acquiring and holding title to any property which it is
authorized to acquire hereunder and to exercise with respect thereto any or
all of the powers set forth herein; and
(p) To manage, administer, operate, lease for any number of years,
develop, improve, repair, alter, demolish, mortgage, pledge, grant options
with respect to, or otherwise deal with any real property or interest
therein at any time held by it, and to hold any such real property in its
own name or in the name of a nominee, with or without the addition of words
indicating that such property is held in a fiduciary capacity, all upon
such terms and conditions as may be deemed advisable by the Company or its
agent.
(q) To make, execute and deliver, as Trustee, any and all deeds,
leases, mortgages, conveyances, waivers, releases, or other instruments in
writing necessary or desirable for the accomplishment of any of the
foregoing powers.
(r) To enter into an agreement of insurance on the life of the
Executive, including without limitation an agreement to split ownership
with another person or entity by endorsement, collateral assignment,
division of ownership or otherwise, and to enter into and execute any
documentation necessary to implement such agreement or agreements.
(s) Generally, to do all acts, whether or not expressly authorized,
that the Trustee may deem necessary or desirable for the protection of the
Fund.
5.4 The Trustee shall distribute cash or other assets from the Fund in
accordance with Articles 3, 4 and 9 hereof. The Trustee may make any
distribution required hereunder by mailing its check for the specified amount
or, if distribution is to be made in kind, by making other appropriate
distribution, to the person to whom such distribution or payment is to be made,
at such address as may be specified pursuant to Section 11.6, or if no such
address shall have been so furnished, to such person in care of the Company, or
(if so directed by the recipient) by crediting the account of such person or by
transferring funds to such person's account by bank or wire transfer.
5.5 If at any time there is no person authorized to act under this
Agreement on behalf of the Company, the Vice President of Human Resources, or
the person occupying a similar position with the Company at the time, shall have
the authority to act hereunder.
5.6 With respect to the terms of this Agreement, the existence and
terms of any amendments hereto, the termination of the Trust hereunder and the
identity, decision and actions of the Executive, the Company and the Trustee,
all persons may rely conclusively on the facts stated in a certificate signed by
a Trustee.
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ARTICLE 6.
PAYMENT OF TAXES AND EXPENSES
6.1 The Executive, or in the event of the Executive's death, the
Executive's personal representative, shall be responsible for the payment of any
federal, state or local taxes on Company contributions to the Fund, subject to
the Company's obligation under the Trust to reimburse the Executive in respect
of the estimated taxes due on such contributions. The Executive shall also be
responsible for the payment of any federal, state or local taxes on Fund
earnings; provided the Company has no obligation to reimburse the Executive in
respect of any taxes due on such Fund earnings.
6.2 (a) Except as otherwise provided herein, the Company shall pay the
Trustee its reasonable expenses for the management and administration of
the Fund, including without limitation advances for or prompt reimbursement
of reasonable expenses of counsel and other agents employed by the Trustee,
and reasonable compensation for its services as Trustee hereunder, the
amount of which shall be agreed upon from time to time by the Company and
the Trustee in writing; provided, however, that if the Trustee forwards an
amended fee schedule to the Company requesting its agreement thereto and
the Company fails to object thereto within thirty (30) days of its receipt,
the amended fee schedule shall be deemed to be agreed upon by the Company
and the Trustee; and provided further that for all periods prior to the
Executive's termination of employment, and for a period of sixty (60) days
thereafter the Company shall pay to the Trustee its reasonable expenses for
the management and administration of the SERP Account.
(b) The Company and the Executive acknowledge that the Trustee, or an
affiliate thereof, will, in addition to the compensation provided by this
Section 6.2, receive compensation with regard to the administration and
investment of certain funds referred to in Section 5.2(b) hereof, and the
Company and the Executive agree that the Trustee, or any affiliate thereof,
shall receive such compensation from the Company in addition to the
compensation provided by this Section 6.2.
ARTICLE 7.
TRUST RECORDS
7.1 The Trustee shall maintain records with respect to the Fund that
show all its receipts and disbursements hereunder. The records of the Trustee
with respect to the Fund shall be open to inspection by the Company or its
representatives and by the Executive at all reasonable times during normal
business hours of the Trustee and may be audited not more frequently than once
each fiscal year by an independent certified public accountant engaged by the
Company; provided, however, the Trustee shall be entitled to additional
compensation from the Company in respect of audits or auditors' requests which
the Trustee determines to exceed the ordinary course of the usual scope of such
examinations of its records.
7.2 Within sixty (60) days after the close of each fiscal year of the
Company (or, in the Trustee's discretion, at more frequent intervals), or of any
termination of the duties of the Trustee hereunder, whether by removal,
resignation or termination of the Trust, the Trustee
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shall prepare and deliver to the Company and the Executive a statement of
transactions reflecting its acts and transactions as Trustee during such fiscal
year, portion thereof or during such period from the close of the last fiscal
year or last statement period to the termination of the Trustee's duties,
respectively, including a statement of the then current value of the Fund. Any
such statement shall be deemed an account statement accepted and approved by the
Company and the Executive, and the Trustee shall be relieved and discharged, as
if such account had been settled and allowed by a judgment or decree of a court
of competent jurisdiction, unless protested by written notice to the Trustee
within sixty (60) days of receipt thereof by the Company or the Executive.
7.3 The Trustee shall have the right to apply at any time to a court
of competent jurisdiction for judicial settlement of any account of the Trustee
not previously settled as herein provided or for the determination of any
question of construction or for instructions. In any such action or proceeding
it shall be necessary to join as parties only the Trustee, the Company and the
Executive (although the Trustee may also join such other parties as it may deem
appropriate), and any judgment or decree entered therein shall be conclusive.
ARTICLE 8.
RESIGNATION/REMOVAL OF TRUSTEE
AND APPOINTMENT OF SUCCESSOR TRUSTEE
8.1 The Trustee may resign at any time by delivering written notice
thereof to the Company and the Executive; provided, however, that no such
resignation shall take effect until the earlier of (i) sixty (60) days from the
date of delivery of such notice to the Company and the Executive or (ii) the
appointment of a successor trustee.
8.2 The Trustee may be removed at any time by the Company with the
concurrence of the Executive, upon delivery to the Trustee of a certified letter
of direction from the Company or the Executive and sixty (60) days' written
notice to the Trustee and the Executive of (i) such removal and (ii) the
appointment of a successor trustee, unless such notice period is waived in whole
or in part by the Trustee.
8.3 Upon the resignation or removal of the Trustee, a successor
trustee shall be appointed by the Company, with the concurrence of the
Executive. Such successor trustee shall be a bank or trust company established
under the laws of the United States, or a state within the United States, or in
any other jurisdiction. Such appointment shall take effect upon the delivery to
the successor trustee and the Executive of (i) a written appointment of such
successor trustee, duly executed, by the Company and (ii) a written acceptance
by such successor trustee, duly executed. Any successor trustee shall have all
the rights, powers and duties granted the Trustee hereunder. The successor
trustee shall be entitled to rely on the books and accounts delivered to it by
the prior trustee as provided in Section 7.2 hereof, and shall be held harmless
by the Company and the Executive with respect to any errors or misstatements
therein.
8.4 If, within sixty (60) days of the delivery of the Trustee's
written notice of resignation, a successor trustee shall not have been
appointed, the Trustee shall apply to any court of competent jurisdiction for
the appointment of a successor trustee.
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8.5 Upon the resignation or removal of the Trustee and the appointment
of a successor trustee, and after the acceptance and approval of its accounts,
the Trustee shall transfer and deliver the Fund to such successor trustee. Under
no circumstances shall the Trustee transfer or deliver the Fund to any successor
trustee which is not a bank or trust company. In the event that the Fund is
invested in any common, collective, commingled trust or mutual fund established,
maintained or advised by the Trustee or any affiliate thereof, the Trustee may
reduce such investment to cash within a reasonably practicable period prior to
delivery to a successor trustee.
ARTICLE 9.
TRUST TERMINATION
9.1 The Trust established pursuant to this Agreement shall terminate
upon the withdrawal by the Executive of all amounts in the Fund, as provided in
Sections 3.5 and 4.2. The Trust also shall terminate upon the expiration of
sixty (60) days following the Executive's termination of employment (by
retirement or otherwise), unless the Trustee and the Executive agree to continue
the Trust thereafter upon such terms as they may agree, but in the event of such
continuation the Company shall have no further obligations under this Agreement
with respect to matters relating to such continuation, including without
limitation expenses and compensation of the Trustee with respect to matters
arising from actions occurring after the expiration of the sixty (60) day
period.
9.2 Upon the termination of the Trust by reason of the death of the
Executive, or by reason of the Executive's termination of employment other than
by death if the Trust has not been continued by agreement between the Trustee
and the Executive, the Trustee shall distribute the Fund as directed by the
Executive, or in the event of the Executive's death his personal representative,
after deducting therefrom any amounts owing to the Trustee under this Agreement
which have not been paid by the Company. Upon any termination of the Trust in
accordance with this Article 9, the Trustee shall, after the acceptance and
approval of its account, be relieved and discharged. The powers of the Trustee,
including the right to receive compensation for services and payment of
expenses, as provided in Section 6.2, shall continue as long as any part of the
Fund remains in its possession.
9.3 Notwithstanding the provisions of Sections 9.1 and 9.2 above, in
the event there is in effect a RHCA as described in Section 4.1 above, the Trust
established pursuant to this Agreement shall continue for as long as there
remain funds in the RHCA, and the Company shall continue to pay the expenses and
compensation of the Trustee as they relate to the RHCA.
ARTICLE 10.
TRUST AMENDMENT
10.1 This Agreement may be amended, in whole or in part, at any time
and from time to time, by the mutual agreement and written consent of the
parties, which consent shall not unreasonably be withheld. In particular, the
Agreement may be amended to the extent required by the Internal Revenue Service
in conjunction with a ruling request. Any amendment made by the Company shall be
authorized and approved pursuant to a resolution of the Board of Directors of
the Company, and by delivery to the Trustee of a certified copy of such
resolution
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and a written instrument duly executed and acknowledged by the Company and the
Executive in the same form as this Agreement.
ARTICLE 11.
GENERAL PROVISIONS
11.1 This Agreement shall be construed and interpreted under, and the
Trust hereby created shall be governed by, the laws of the State in which the
Trustee is incorporated, insofar as such laws do not contravene any applicable
federal laws, rules or regulations.
11.2 Neither the gender nor the number (singular or plural) of any
word shall be construed to exclude another gender or number when a different
gender or number would be appropriate.
11.3 Should this Agreement be held invalid or unenforceable (in whole
or in part) with respect to any term or condition hereof, it shall remain fully
valid and enforceable as to all other terms and conditions.
11.4 This Agreement shall be binding upon and inure to the benefit of
the Executive, his estate, personal representative, beneficiary, heirs and
assigns. This Agreement also shall be binding upon and inure to the benefit of
any successor to the Company or its business as the result of merger,
consolidation, reorganization, transfer of assets or otherwise and any
subsequent successor thereto. In the event of any such merger, consolidation,
reorganization, transfer of assets or other similar transaction, the successor
to the Company or its business or any subsequent successor thereto shall
promptly notify the Trustee in writing of its successorship and furnish the
Trustee with the information specified in Section 2.4 of this Agreement. In no
event shall any such transaction described herein suspend or delay the rights of
the Executive to receive benefits hereunder.
11.5 This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original, but all of which shall together
constitute only one Agreement.
11.6 All notices and other communications provided for in this
Agreement shall be in writing and shall be deemed to have been duly given when
actually delivered to the respective addresses set forth below:
Company: Brown & Williamson Tobacco Corporation
P.O. Box 35090
Louisville, KY 40232
Attn: Vice President of Human Resources
Trustee: State Street Bank and Trust Company
225 Franklin Street
Boston, MA 02110
Attn: Trusts and Estates
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Executive: Address:
-------------------------------
-------------------------------
or at such other address as such person may specify in writing by notice as set
forth above to the other persons listed above.
IN WITNESS WHEREOF, the parties hereto have caused this Trust
Agreement to be duly executed as of the date first above written.
Witness:
----------------------------------------
[EXECUTIVE'S NAME]
BROWN & WILLIAMSON TOBACCO
CORPORATION
Attest:
By:
- ------------------------------------- ------------------------------------
Secretary/Asst. Secretary Authorized Officer
BROWN & WILLIAMSON TOBACCO
CORPORATION
Attest:
By:
- ------------------------------------- ------------------------------------
Secretary/Asst. Secretary Authorized Officer
Attest: STATE STREET BANK AND TRUST COMPANY
By:
- ------------------------------------- ------------------------------------
Secretary/Asst. Secretary Authorized Officer
Page 15 of 16
COMMONWEALTH OF KENTUCKY )
: SS
COUNTY OF JEFFERSON )
The foregoing instrument was subscribed, sworn to and acknowledge
before me this _____ day of _______________, 20__, by ____________________, and
acknowledged the same to be his free act and deed.
My commission expires: .
----------------------------------------------
----------------------------------------------
Notary Public
COMMONWEALTH OF KENTUCKY )
: SS
COUNTY OF JEFFERSON )
The foregoing instrument was subscribed, sworn to and acknowledge
before me this _____ day of _______________, 20__, by ________________________,
of BROWN & WILLIAMSON TOBACCO CORPORATION, this _____ day of _______________,
2003, and acknowledged the same to be his free act and deed as such
_______________________ and the free act and deed of the said Corporation.
My commission expires: .
----------------------------------------------
----------------------------------------------
Notary Public
COMMONWEALTH OF KENTUCKY )
: SS
COUNTY OF JEFFERSON )
The foregoing instrument was subscribed, sworn to and acknowledge
before me this _____ day of _______________, 20__, by ________________________,
of STATE STREET BANK AND TRUST COMPANY, this _____ day of _______________, 2003,
and acknowledged the same to be his free act and deed as such
_______________________ and the free act and deed of the said Company.
My commission expires: .
----------------------------------------------
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Notary Public
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