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EXHIBIT 10.56
TRUST AGREEMENT
FOR THE
SAKS INCORPORATED 401(k) RETIREMENT PLAN
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TRUST AGREEMENT
FOR THE
SAKS INCORPORATED 401(k) RETIREMENT PLAN
TABLE OF CONTENTS
Establishment 1
1.1 Establishment of Trust............................................1
1.2 Plan Qualification................................................1
1.3 Other Trusts......................................................1
Administration of Trust Fund 2
2.1 General Administration............................................2
2.2 Contributions to Trust............................................2
2.3 Accounts..........................................................2
2.4 Distributions from Trust..........................................2
Investment Direction 3
3.1 Directed Trustee..................................................3
3.2 Named Fiduciary - Investment Direction............................4
3.3 Participant - Investment Direction................................4
3.4 Appointment of Investment Manager.................................4
3.5 Short-Term Investment Pending Instructions........................6
3.6 Securities Lending................................................7
Powers Of Trustee 7
4.1 Directed Powers of the Trustee....................................7
4.2 Discretionary Powers of the Trustee...............................8
4.3 Voting............................................................9
Accountings 10
5.1 Valuation and Reports............................................10
5.2 Approval of Account..............................................10
Compensation, Fees And Expenses 11
6.1 Trustee Compensation.............................................11
6.2 Taxes and Expenses...............................................11
6.3 Method of Payment................................................11
Resignation Or Removal Of Trustee 12
Protection/Limitation On Liability For Trustee 12
8.1 Trustee's Protection.............................................12
8.2 Reliance by Trustee..............................................13
8.3 Absence of Instructions..........................................13
8.4 Indemnification by the Sponsor and Plan Administrator............13
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Prohibition Of Diversion 14
Amendment And Termination Of The Trust 15
10.1 Amendment........................................................15
10.2 Termination......................................................15
Miscellaneous Provisions 15
11.1 Nonalienation....................................................15
11.2 Employment.......................................................16
11.3 Certification of Trust Agreement.................................16
11.4 Governing Law....................................................16
11.5 Segregation of Assets............................................16
11.6 Titles...........................................................16
11.7 Counterparts.....................................................17
11.8 Severability.....................................................17
11.9 Written Notice...................................................17
11.10 Confidentiality of Agreement.....................................17
Definitions 17
12.1 "Act"............................................................17
12.2 "Agreement"......................................................17
12.3 "Code"...........................................................17
12.4 "Named Fiduciary"................................................17
12.5 "Participant"....................................................17
12.6 "Participant Loan"...............................................17
12.7 "Plan"...........................................................18
12.8 "Plan Administrator".............................................18
12.9 "Recordkeeper"...................................................18
12.10 "Trust"..........................................................18
12.11 "Trust Fund".....................................................18
12.12 "Trustee"........................................................18
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TRUST AGREEMENT
This agreement, made and entered into the _____ day of
________________, 1999, by and between Saks Incorporated (the "Sponsor"), a
corporation having its principal office in Birmingham, Alabama and AmSouth Bank,
an Alabama banking corporation (the "Trustee").
W I T N E S S E T H:
WHEREAS, the Sponsor has duly established the Saks Incorporated 401(k)
Retirement Plan, hereinafter called the "Plan," for certain of its employees and
the employees of other adopting employers and has authorized the creation of a
Trust Fund to be administered under the Plan by the Trustee, to which Trust Fund
contributions are to be made from time to time by the Sponsor and the other
adopting employers, to be used for the exclusive benefit of its said employees
and their successors in interest in accordance with the provisions of the Plan
and as hereinafter set forth; and
WHEREAS, the Trustee is willing to serve as a directed trustee and to
hold and administer such money and other property pursuant to the terms of the
Plan and this Trust Agreement;
NOW, THEREFORE, the Sponsor and the Trustee agree as follows:
ARTICLE I
ESTABLISHMENT
1.1 ESTABLISHMENT OF TRUST.
The Sponsor hereby continues the Trust previously established, which
consists of amounts contributed and/or transferred to the Trustee,
investments and proceeds thereof and earnings thereon, reduced by
payments from the Trust as provided herein. The Trustee, by executing
this Trust Agreement, accepts the Trust and agrees to administer the
Trust as provided herein.
1.2 PLAN QUALIFICATION.
The Sponsor hereby represents that the Plan is qualified under Code
Section 401(a) and agrees to notify the Trustee if it has reason to
believe the Plan has ceased or will cease to be so qualified. Trustee
will have no liability or responsibility for the validity, legal effect
or tax qualification of the Plan.
1.3 OTHER TRUSTS.
Nothing in this Trust Agreement shall prevent the establishment of
other trusts under the Plan.
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ARTICLE II
ADMINISTRATION OF TRUST FUND
2.1 GENERAL ADMINISTRATION.
This Trust Fund shall be a part of the Plan and shall be administered
for the exclusive purposes of providing benefits to Participants, as
defined in the Plan, and their successors in interest and defraying
reasonable expenses of administering the Plan, and shall be
administered in accordance with the provisions of the Plan and of the
Act. The Trustee, by executing this Trust Agreement, agrees to be bound
by the terms of the Plan applicable to it and by the terms of this
agreement. The Sponsor hereby agrees to provide a copy of the Plan
document to the Trustee to notify the Trustee of any amendment to the
Plan and provide a copy of such amendment to the Trustee within fifteen
days of its effective date.
2.2 CONTRIBUTIONS TO TRUST.
The Trustee will accept such cash contributions made by or on behalf of
Participants as it receives from time to time from the Sponsor, and
such assets as are acceptable to the trustee, as may be transferred by
Participants or by the trustee or custodian of another qualified plan
or individual retirement account, if the Plan Administrator, as defined
in the Plan, has certified that such transfer is in accordance with the
Plan.
The Trustee will have no responsibility for determining the time or
amount of any contribution to the Trust or enforcing the collection of
any contribution. Also, the Trustee will have no responsibility for
determining that contributions satisfy any applicable requirement of
the Plan or law, including, but not limited to, the minimum
contribution requirements of Code Sections 412 and 416. Also, the
Trustee will have no responsibility for determining whether the amount
of any contribution (or the portion of such contribution allocated to
the account(s) of a participant) is within any applicable limit,
including, but not limited to, the limits imposed by Code Sections
401(k) and (m), 402(g), 404 and 415. The contribution or transfer of
any amount to the Trustee hereunder constitutes a certification by the
Sponsor and the Plan Administrator that such contribution or transfer
is in accordance with the Plan.
2.3 ACCOUNTS.
The Trustee will maintain such accounts or funds as are necessary for
the Trustee to carry out its responsibilities under the Plan; and the
Trustee will make credits to or charges against such accounts or funds
as provided therein. The Trustee will not maintain records of
individual Participant accounts.
2.4 DISTRIBUTIONS FROM TRUST.
The Trustee shall pay benefits and expenses (other than taxes and
Trustee compensation and expenses) from the Trust Fund only upon the
written direction of the Plan Administrator.
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(a) The Sponsor will certify to the Trustee the identity of the Plan
Administrator (and of any other person authorized to act on
behalf of the Sponsor for purposes of the Plan) and will provide
specimen signatures of the person or persons serving as Plan
Administrator or on behalf of the Sponsor. The Trustee may
assume that the authority of such person or persons continues
unless the Sponsor advises the Trustee otherwise in writing. The
Trustee shall be fully entitled to rely on such directions and
shall be under no duty to ascertain whether the directions are
in accordance with the provisions of the Plan.
(b) If the Plan Administrator has delegated certain functions to a
Recordkeeper, the Plan Administrator may instruct the Trustee to
take directions from such Recordkeeper. The Plan Administrator
will provide specimen signatures of the person or persons
serving as the Recordkeeper. The Trustee may assume that the
authority of such person(s) continues unless the Plan
Administrator advises the Trustee otherwise in writing. The
Trustee shall be fully entitled to rely on directions from the
Recordkeeper and shall be under no duty to ascertain whether the
directions are in accordance with the provisions of the Plan.
(c) Upon receipt of a written notice from the Plan Administrator
certifying that an amount is payable to a Participant, or other
person under the Plan, the Trustee will promptly pay such amount
in accordance with the notice and will be fully protected in so
doing. The Plan Administrator's notice will include all
information necessary to enable the Trustee to make such
payment, including income tax withholding instructions and the
account or accounts or investment fund or funds to be charged
with such payments. The Plan Administrator's giving of a payment
notice constitutes a certification from the Plan Administrator
to the Trustee that such payment is in accordance with the Plan,
that the Plan Administrator has provided the Participant any and
all notices and explanations required by law and that the Plan
Administrator has properly obtained any waivers or consents of
the Participant, the Partner's spouse or other distributee
required by law. The Trustee will have no responsibility for the
application of any payment by the recipient, for determining the
rights or benefits of any person in the Trust or under the Plan,
for the administration of the Plan, or for the adequacy of the
Trust to meet all liabilities arising under the Plan. The
Trustee shall not have any responsibility for calculating or
determining any amount to be distributed to a Participant and/or
for compliance with any applicable requirements for minimum
distributions.
ARTICLE III
INVESTMENT DIRECTION
3.1 DIRECTED TRUSTEE.
The Trustee shall act only as a directed Trustee and shall exercise no
discretion over the investment or distribution of the Trust Fund. The
Trustee shall invest and reinvest the Trust Fund, without distinction
between principal and income, in accordance with investment directions,
as provided in this Article. The Trustee will have no responsibility to
review or question such investment directions or to review any
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investment to be acquired, held or disposed of pursuant to such
investment directions or to make any recommendations with respect to
the disposition or continued retention of any such investment. When
accepting and implementing such investment directions, the Trustee will
have no responsibility or liability for compliance with any applicable
requirements concerning plan investments under the Plan or the Act or
for any loss or diminution in value which results from the choice of
investments for the Trust Fund. Whenever the Trustee is permitted or
required to act upon instructions or directions of a Named Fiduciary,
Plan Administrator, Participant, or investment manager, the Trustee
will have no responsibility or liability for any action taken or
omitted by the Trustee in reliance thereon.
It is understood and agreed by the parties that although the Trustee
will perform certain ministerial and custodial duties with respect to
the assets held in Trust, such duties will be performed in the normal
course by officers and other employees of the Trustee or by such other
person or persons with whom the Trustee has contracted to perform
services for it, all of whom may be unfamiliar with investment
management, and that such duties will not include the exercise of any
discretionary authority or other authority to manage and control assets
comprising the Trust Fund.
3.2 NAMED FIDUCIARY - INVESTMENT DIRECTION.
Subject to Sections 3.3 and 3.4, the Trustee shall invest the Trust
Fund pursuant to the written direction of the Plan's Named Fiduciary to
whom such responsibility has been assigned. The Sponsor will certify to
the Trustee the identity of such Named Fiduciary (and of any other
person authorized to act on behalf of such Named Fiduciary for purposes
of the Plan) and will provide specimen signatures of such person or
persons. The Trustee may assume that the authority of such person or
persons continues unless the Sponsor notifies the Trustee in writing.
The Trustee will not be liable, or obligated to inquire into, the acts
or omissions of such Named Fiduciary.
3.3 PARTICIPANT - INVESTMENT DIRECTION.
If the Plan permits Participants to direct the investment of some or
all of their Plan accounts, the Trustee will invest the Trust Fund
pursuant to the Plan and the Participants' investment directions. Each
Participant shall convey investment instructions to the Plan
Administrator and the Plan Administrator shall transmit those
instructions, in writing, promptly to the Trustee, unless the Sponsor
and the Trustee have agreed, in a separate written agreement, to accept
Participant directed investment instructions from the Recordkeeper of
the Sponsor.
3.4 APPOINTMENT OF INVESTMENT MANAGER.
(a) The Named Fiduciary to whom such responsibility has been
assigned may in writing appoint an investment manager or
managers to assume responsibility for the investment of any
portion or all of the assets of the Trust Fund for such time as
such Named Fiduciary may determine and, unless such power is
reserved to that Named Fiduciary, for directing the Trustee to
vote or refrain from voting any stocks, bonds or other
securities held in the Trust over which the investment manager
has investment responsibility and to exercise or refrain from
exercising
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any rights to subscribe for additional stocks, bonds or other
securities appurtenant to such securities.
Communication of such appointment to the Trustee by a Named
Fiduciary shall constitute an allocation to the investment
manager of fiduciary responsibility for the part of the Trust
Fund subject to its management and control. If the Plan gives a
Participant investment control over the assets in his account,
the Participant may appoint an investment manager; in such a
case, references to the Named Fiduciary in this Section 3.4 will
be deemed to be references to the Participant.
If the Employer's Plan allows Participants to select individual
securities for their own accounts, the Trustee shall implement
the investment transactions of directing Participants through
brokers designated by Participants, or, in the absence thereof,
through brokers of its own choosing, or shall settle
transactions upon receipt of instructions from Participants.
The Trustee shall not be responsible for any loss caused by a
Participant's inaction, or by action upon any notice, direction
or other certification furnished by a Participant pursuant to
Paragraph 3.4 and which the Trustee reasonably believes to be
genuine. The Trustee shall have no duty to review the securities
or other property held in the account of any such Participant or
to make any suggestions or recommendations to any such
Participant with respect to the investment, reinvestment, or
disposition of investments made by any such Participant. The
Trustee shall not be responsible for investment performance
arising from compliance with the instructions of any such
Participant, unless said Participant shall have directed that
monies standing to the credit of his account be invested in a
portfolio or collective fund managed by the Trustee.
(b) The Sponsor shall ascertain and shall certify to the Trustee
that any investment manager appointed hereunder is (i)
registered as an investment adviser under the Investment
Advisers Act of 1940; (ii) a bank, as defined in that Act; or
(iii) an insurance company qualified to perform investment
management services under the laws of more than one state, and
that the instrument or instruments appointing an investment
manager and evidencing the investment manager's acceptance of
such appointment contains an acknowledgment by the investment
manager that it is a fiduciary with respect to the Plan.
(c) The investment manager(s) will have sole responsibility for the
investment and, unless reserved to a Named Fiduciary, the voting
and subscription action of the portion of the Trust Fund under
its or their respective management and the Trustee shall take
such action only upon the proper instructions of the Investment
Manager. The Trustee will not be liable, or obligated to inquire
into, the acts or omissions of any investment manager appointed
hereunder.
If directed by the Sponsor, the Trustee shall charge
compensation of an Investment Manager and any expenses related
to investments directly by an Investment Manager against such
accounts. The Trustee shall not be responsible for determining
the reasonableness of any compensation paid to or agreed to be
paid to an Investment Manager.
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The Trustee shall not be responsible for any loss caused by its
acting upon any notice, direction or certification of any
Investment Manager appointed by the Sponsor which the Trustee
reasonably believes to be genuine. The Trustee shall have no
duty to question any direction, action or inaction of any
Investment Manager. The Trustee shall have no duty to review the
securities or other property held in any investment manager
account or to make any suggestions to any Investment Manager or
to the Sponsor with respect to the investment, reinvestment, or
disposition of investments in any investment manager account.
The Trustee shall not be responsible for investment performance
arising from its compliance with the instructions of any
Investment Manager.
(d) The investment manager shall from time to time certify to the
Trustee the name of the person or persons authorized to act on
behalf of the investment manager hereunder, and furnish the
Trustee a specimen of the signature of any such person. Any
person so certified shall be deemed to be the authorized
representative of the investment manager. When any person so
certified shall cease to have authority to act on behalf of the
investment manager, the investment manager shall promptly give
notice to that effect to the Trustee. Until such notice is
received by the Trustee, such person shall continue to be an
authorized representative.
(e) All directions to the Trustee by the investment manager shall be
in writing (provided that the Trustee may, in its discretion,
accept oral directions subject to confirmation in writing) and
shall be signed by an authorized representative of the
investment manager (as described above). Notwithstanding
anything herein to the contrary, the Trustee shall be fully
protected in acting in accordance with the following types of
directions, to the same extent as if such directions were given
by the investment manager in writing: (i) directions with
respect to securities transactions (including, without
limitation, the affirmation and/or confirmation of such
transactions) received by it through a system or arrangement for
the coordination of securities transaction settlements operated
by any central securities depository, securities clearing
organization, or book-entry system which serves to link
investment managers, securities brokers, and custodian banks;
and (ii) directions (including, without limitation, the
affirmation and/or confirmation of transactions) received by the
Trustee through authenticated telecommunications facilities,
including, without limitation, communications effected directly
between electronic devices, provided that the Trustee and the
investment manager have agreed that such procedures afford
adequate safeguards. The investment manager's directions may be
given as standing instructions.
(f) If an investment manager resigns or is removed by the Named
Fiduciary, the Named Fiduciary will promptly notify the Trustee
and that portion of the Trust Fund will again be invested
pursuant to Section 3.2 or 3.3 hereof until another investment
manager has been appointed with respect to such portion of the
Trust Fund.
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3.5 SHORT-TERM INVESTMENT PENDING INSTRUCTIONS.
In the event the Trustee fails to receive direction with respect to the
investment of any cash contribution or any cash pending investment,
distribution or payment of expenses, the Trustee shall invest such cash
in a fund designated by the Trustee.
3.6 SECURITIES LENDING.
The Named Fiduciary or, if an investment manager has been appointed,
the investment manager, (hereinafter the "Appointing Fiduciary") may
appoint the Trustee as securities lending fiduciary, if the Trustee
consents to such appointment, to establish, manage and administer a
securities lending program on behalf of the Trust Fund, pursuant to
which the Trustee shall have authority to cause any or all securities
held in the Trust Fund (excluding securities held in any portion of the
Trust Fund which the Appointing Fiduciary identifies in writing to the
Trustee as not being eligible to participate in said program) to be
lent to such one or more borrowers as the Trustee shall determine, in
accordance with Prohibited Transaction Class Exemption 81-6. The
Appointing Fiduciary shall enter into a written agreement with the
Trustee setting forth the terms and conditions of the Trustee's
appointment, including without limitation the compensation to be paid
to the Trustee for its services with respect to such securities lending
program.
ARTICLE IV
POWERS OF TRUSTEE
4.1 DIRECTED POWERS OF THE TRUSTEE.
The Trustee shall have the following powers and authority in the
administration of the Trust; provided, however, that such powers and
authority shall be exercised by the Trustee only upon the receipt of
direction as provided in Article III:
(a) to deal with all or any part of the Trust assets, including the
power to acquire and dispose of assets;
(b) to hold any part of the Trust Fund in cash pending the
investment or distribution thereof, without liability for
interest;
(c) to enforce by suit or otherwise, or to waive its rights on
behalf of the Trust, and to defend claims asserted against it or
the Trust; however, the Trustee will not be required to
institute or defend itself, the Plan, or the Trust in any court
or administrative proceeding unless it has first been
indemnified to its satisfaction for the costs and expenses
thereof;
(d) to compromise, adjust and settle any and all claims against or
in favor of it or the Trust;
(e) to vote, or give proxies to vote, any stock or other security,
and to waive notice of meetings;
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(f) to oppose, or participate in and consent to the reorganization,
merger, consolidation or readjustment of the finances or
capitalization of any enterprise, to pay assessments and
expenses in connection therewith, and to deposit securities
under deposit agreements;
(g) to invest or reinvest principal and income of the funds
belonging to the Trust Fund in common or preferred stocks
(including common stock issued by the Sponsor), bonds, mutual
funds (including mutual funds for which the Trustee serves as
investment advisor), or other securities, or limited partnership
interests, or real or personal properties or interests therein,
or any options, warrants or other instruments representing
rights to receive, purchase, or subscribe for the same, or
evidencing or representing any other rights or interests
therein, or group annuity investment contracts issued by a legal
reserve life insurance company authorized to do business in any
State in the United States, or certificates of deposit, variable
demand notes, and demand or time deposits (including any such
notes and deposits of the Trustee bearing a reasonable rate of
interest) or to hold any reasonable amounts of such principal or
income in cash;
(h) to execute such deeds, leases, contracts, bills of sale, notes,
proxies and other instruments in writing as shall be deemed
requisite or desirable in the proper administration of the Trust
Fund;
(i) unless otherwise provided in the Plan, to cause all or any part
of the money or other property of this Trust to be commingled
with the money or other property of trusts created by others by
causing such assets to be invested as part of any one or more
collective investment funds or group trusts maintained by
fiduciaries with respect to this Plan and Trust, including the
Trustee. The Declaration of Trust under which each such
collective investment fund or group trust is established and
maintained, as from time to time amended, is hereby made a part
of this trust to the same extent as if its terms were set out in
full herein.
(j) to sell for cash, to convert, redeem or exchange for other
securities or other property, to tender securities pursuant to
tender offers, or otherwise to dispose of any securities or
other property at any time held by the Trustee;
(k) to exercise any conversion privilege, subscription or other
rights incident to property in the Trust and to make payments
incidental thereto;
(1) to serve without being required to give bond to any court; and
to do all acts and things, not specified herein, which it deems
advisable to carry out the Trust; and generally to exercise any
of the powers of an owner with respect to all or any part of the
Trust.
(m) Notwithstanding anything else contained in the Plan or this
Agreement, the Trustee may not purchase any employer securities
or employer real property other than Qualifying Employer
Securities or Qualifying Employer Real Property as defined in
section 407 of ERISA and the Trustee shall not invest in
Qualifying Employer Securities or Qualifying Employer Real
Property in excess of the amounts permitted by ERISA. If the
Trustee at any time holds such assets in
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excess of the applicable limits, it shall dispose of such
excess assets as required by ERISA.
4.2 DISCRETIONARY POWERS OF THE TRUSTEE.
The Trustee shall have the following powers and authority in the
administration of the Trust to be exercised in its sole discretion:
(a) to register or cause to be registered any securities held by it
hereunder in its own name or in the name of a nominee with or
without the addition of words indicating that such securities
are held in a fiduciary capacity, to permit securities or other
property to be held by or in the name of others, to hold any
securities in bearer form and to deposit any securities or other
property in a domestic depository, clearing corporation, or
similar corporation or a foreign depository, provided the
requirements of Department of Labor Regulation 2550.404b-1 are
met;
(b) to make, execute, and deliver as Trustee hereunder, any and all
instruments in writing necessary or proper for the
accomplishment of any of the powers referred to in Section 4.1
or in this Section 4.2;
(c) to employ suitable agents, advisers, and counsel and to pay
their reasonable expenses and compensation as expenses of the
Trust;
(d) to contract with another person or persons,, related or
unrelated to the Trustee, to perform any of the Trustee's duties
hereunder, including, but not limited to, Trust Fund
recordkeeping, provided, that the expenses and compensation of
such person or persons shall be an expense of the Trustee, and
not an expense of the Trust;
(e) to bring, join in, or oppose any suits or legal proceedings
involving the Trust where the Trustee may be adversely affected
by the outcome, individually or as trustee, or where it is
advised by counsel that such action is required on its part by
the Act or other applicable law;
(f) to receive all rents, issues, dividends, income, profits, and
properties of every nature, due the Trust Fund, and to hold or
make distribution therefor in accordance with the terms of this
Trust Agreement;
(g) to take any action committed to the Trustee's discretion by
other provisions of this Agreement; and
(h) generally to exercise such powers and to do such acts (exclusive
of powers and acts involving investment management or otherwise
committed to the discretion of the investment manager or any
other party hereunder) whether or not expressly authorized,
which may be considered necessary or desirable by the Trustee
for the protection of the Trust.
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4.3 VOTING.
The Plan Administrator shall be entitled to direct the Trustee as to
the manner in which shares of common stock of the Sponsor are to be
voted, except as may be otherwise provided in the Plan.
ARTICLE V
ACCOUNTINGS
5.1 VALUATION AND REPORTS.
(a) The Trustee will keep full accounts of all its receipts,
disbursements and other transactions hereunder, and, annually,
will determine the fair market value of the assets of the Trust
as of the last business day of the plan year. If any assets of
the Trust Fund are invested in property for which there is no
readily ascertainable market value, the individual who directed
such investment be made under Article III shall supply the
Trustee with a proper valuation. For purposes of such accounts,
the fiscal year of the Trust will coincide with the plan year.
Within a reasonable time after the end of the plan year, or
within a reasonable time after its removal or resignation, or
the termination of the Trust, the Trustee will render to the
Plan Administrator an account of its administration of the Trust
since the last previous such accounting.
(b) With the consent of the Trustee, the Plan Administrator or
Sponsor may establish other valuation dates, and the Trustee
will render to the Plan Administrator an account of the value of
the Trust assets as of the current valuation date and, if
requested, of its transactions hereunder since the preceding
valuation date.
(c) The Trustee's records pertaining to the Trust Fund shall be open
to inspection, copying and audits at reasonable times by the
Plan Administrator and any investment manager. No person other
than the Plan Administrator will have the right to demand or
receive any report or account from the Trustee. In any
proceeding for a judicial settlement of any account or for
instructions, the only necessary parties will be the Trustee and
the Plan Administrator.
5.2 APPROVAL OF ACCOUNT.
The written approval of any account by the Plan Administrator will be
final and binding upon the Plan Administrator, the Sponsor, the
Participants and all persons who then are or thereafter become
interested in the Trust, as to all matters and transactions stated or
shown therein. The failure of the Plan Administrator to notify the
Trustee within 60 days after the Trustee's sending of any account of
its objections (if any) to the account will be the equivalent of
written approval. If the Plan Administrator files any objections within
such 60-day period with respect to any matters or transactions stated
or shown in the account and the Plan Administrator and the Trustee
cannot resolve the questions raised by such objections, the Trustee
will have the right to have such questions settled by judicial
proceedings. Nothing herein will deprive the Trustee of the right to
have a judicial settlement of its accounts.
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ARTICLE VI
COMPENSATION, FEES AND EXPENSES
6.1 TRUSTEE COMPENSATION.
(a) As compensation for its services hereunder, the Trustee shall be
entitled to receive from the Sponsor compensation in accordance
with its schedule of fees, as amended by the Trustee from time
to time, but not in excess of reasonable compensation for such
services. Regardless, the Trustee may not increase its fees
until it has given the Sponsor written notice at least thirty
(30) days preceding such increase.
(b) The Trustee may charge a reasonable fee in addition to its
normal fees if it performs any services not contemplated in the
fee schedule at the request of the Plan Administrator or
Sponsor.
(c) The Trustees fee, unless paid by the Sponsor at its option
within thirty days of the Trustee's invoice, shall be paid from
the Trust.
6.2 TAXES AND EXPENSES.
(a) Any or all real and personal property taxes, income taxes and
other taxes of any and all kinds whatsoever upon or in respect
of the Trust Fund hereby created or any money, income or
property forming a part thereof, and any or all fees and
expenses actually and properly incurred in the administration of
the Plan or the Trust Fund, may be paid directly from the assets
of the Trust Fund. To the extent such taxes, fees and expenses
are not paid from the Trust Fund, they shall be paid by the
Sponsor.
(b) The Trustee may assume that any taxes assessed on or in respect
of the Trust Fund are lawfully assessed unless the Plan
Administrator or the Sponsor shall in writing advise the Trustee
that in the opinion of counsel for the Sponsor such taxes are
not lawfully assessed. In the event that the Plan Administrator
or Sponsor shall so advise the Trustee, the Trustee, if so
requested by the Plan Administrator and suitable provision for
their indemnity having been made, shall contest the validity of
such taxes in any manner deemed appropriate by the Plan
Administrator, Sponsor or counsel for the Sponsor. The word
"taxes" in this Section 6.2 shall be deemed to include any
interest or penalties that may be levied or imposed in respect
to any taxes assessed.
6.3 METHOD OF PAYMENT.
In order to provide for payment of any fees, taxes or expenses as
provided in Sections 6.1 and 6.2, the Trustee in its discretion may
partially or fully liquidate any asset in the Trust Fund and shall not
be liable for any loss occasioned thereby. Any expenses of the Trustee
which are not paid from the Trust for whatever reason will be the
responsibility of the Sponsor. Any payment out of the Trust Fund of any
of the taxes and expenses authorized in this Article VI, and of all
other costs, expenses or compensation authorized
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by this Trust Agreement and by the Sponsor to be paid out of the Trust
Fund, shall be deemed to be for the exclusive benefit of the
Participants and their successors in interest.
ARTICLE VII
RESIGNATION OR REMOVAL OF TRUSTEE
(a) Any Trustee may resign at any time by giving 60 days' written
notice to the Sponsor, and the Sponsor may remove any Trustee at
any time by giving 60 days' written notice to the Trustee; in
either case, the notice period may be reduced to such shorter
period as the Trustee and the Sponsor agree upon. The Trustee's
removal or resignation will be effective upon the last day of
the notice period or, if later, the acceptance of the Trust by
the successor Trustee. Until the effective date of the
appointment of a successor Trustee (or the termination of the
Trust and complete distribution of its assets), the incumbent
Trustee will have full authority and responsibility to act as
Trustee hereunder.
(b) When the Trustee's resignation or removal becomes effective, the
Trustee will perform all acts necessary to transfer the assets
of the Trust to its successor. However, the Trustee may reserve
such portion of the trust assets as it may reasonably determine
to be necessary for payment of its fees and any taxes and
expenses; any balance of such reserve remaining after payment of
such fees, taxes and expenses will be paid over to its
successor.
(c) Resignation or removal of the Trustee will not terminate the
trust. In the event of any vacancy in the position of Trustee,
whether by the resignation or removal of the Trustee, the
Sponsor will appoint a successor trustee and such appointment
will become effective upon the acceptance of its office by the
successor trustee. If the Sponsor does not appoint such a
successor within 60 days after notice of resignation or removal
is given, the Trustee may apply to a court of competent
jurisdiction for such appointment or terminate the Trust and
make distributions in the manner prescribed in the Plan. Each
successor Trustee so appointed and accepting a Trusteeship
hereunder will have all of the rights and powers and all of the
duties and obligations of the original trustee under the
provisions hereof.
(d) No trustee will be liable or responsible for anything done or
omitted to be done in the administration of the Trust before it
became Trustee or after it ceases to be Trustee.
ARTICLE VIII
PROTECTION/LIMITATION ON LIABILITY FOR TRUSTEE
8.1 TRUSTEE'S PROTECTION.
Except as provided in Article III, the Trustee shall have no duty to
take any action other than as herein specified, unless the Sponsor or
the Plan Administrator shall furnish it with instructions in proper
form and such instructions shall have been specifically agreed to by
it, or to defend or engage in any suit unless it shall have first
agreed in writing to
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do so and shall have been fully indemnified to its satisfaction. The
Trustee may designate in a writing to the Sponsor or Plan Administrator
a person or persons to whom instructions may be provided in lieu of
instructions to the Trustee directly, and receipt of instructions by
such person(s) shall be treated as an instructions received by the
Trustee.
8.2 RELIANCE BY TRUSTEE.
(a) The Trustee may rely upon any decision of the Plan Administrator
purporting to be made pursuant to the terms of the Plan, and
upon any information, statements, certifications or directions
submitted by the Sponsor or the Plan Administrator (including
statements concerning the entitlement of any Participant to
benefits under the Plan or directions to make payments), and
will not be bound to inquire as to the basis of any such
decision or information or statements, and will incur no
obligation or liability for any action taken or omitted by the
Trustee in reliance thereon.
(b) Whenever the Trustee is permitted or required to act upon the
instructions or directions of the Sponsor or Plan Administrator,
the Trustee will be fully protected in not acting in the absence
hereof.
(c) The Trustee may conclusively rely upon and shall be protected in
acting in good faith upon any written representation or order
from the Sponsor or the Plan Administrator or any other notice,
request, consent, certificate or other instrument or paper
believed by the Trustee to be genuine and properly executed, or
any instrument or paper if the Trustee believes the signature
thereon to be genuine.
(d) The Trustee may consult with legal counsel (who may be or may
not be counsel for the Sponsor) concerning any questions which
may arise with respect to its rights and duties hereunder, and
the opinion of such counsel will be full and complete protection
in respect of any action taken or omitted by the Trustee
hereunder in good faith and in accordance with the opinion of
such counsel.
8.3 ABSENCE OF INSTRUCTIONS.
If the Trustee receives no instructions from the Sponsor and/or Plan
Administrator in response to communications sent to the Plan
Administrator or the Sponsor at the last known address as shown on the
books of the Trustee, the Trustee may make such determination with
respect to distributions and other administrative matters arising under
the Plan as it considers reasonable. Any determinations so made will be
binding on all persons having or claiming any interest under the Plan
or Trust, and the Trustee will incur no obligation or responsibility
for any such determination made in good faith or for any action taken
in pursuant thereof.
8.4 INDEMNIFICATION BY THE SPONSOR AND PLAN ADMINISTRATOR.
(a) The Sponsor and the Plan Administrator (if different from the
Sponsor) shall indemnify and hold harmless the Trustee and its
officers, directors, employees, shareholders, and agents (the
"Indemnitees") from and against any losses, costs, damages, or
expenses, including reasonable attorneys' fees, which the
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Indemnitees may incur or pay out by reason of (i) the
Indemnitees acting in accordance with the directions the
Sponsor, Plan Administrator, Participant (if such self direction
is permitted by the Plan), or an investment manager or failing
to act in the absence of such certification or other information
provided by the Sponsor, Plan Administrator, Participant, or an
investment manager; (ii) the Trustee's exercise and performance
of its powers and duties hereunder, unless the same are
judicially determined to be due to the Trustee's gross
negligence, bad faith or willful misconduct; or (iii) any
(alleged or actual) action or inaction, including but not
limited to the diversion of assets, on the part of the Sponsor,
Plan Administrator, Participant, or an investment manager,
unless such losses, costs, damages, or expenses arise out of the
Trustee's gross negligence, bad faith, or willful misconduct.
(b) In addition, regardless of whether the Plan meets the
requirements of Section 404(c) of the Act and regulations
thereunder, if the Participant is permitted to direct the
investment of his or her account, the Sponsor and Plan
Administrator (if different from the Sponsor) shall indemnify
and hold harmless the Indemnitees from and against any losses,
costs, damages, or expenses, including reasonable attorneys'
fees, which the Indemnitees may incur or pay out by reason of
the Indemnitees' acting in accordance with a Participant's
directions or failing to act in the absence of such directions
or acting or failing to act in reliance on a Participant's
instructions incorrectly conveyed by the Plan Administrator.
(c) The Sponsor further agrees to indemnify and hold harmless the
Trustee for any losses, costs, damages, or expenses, including
reasonable attorney's fees, which the Indemnitees may incur or
pay out by reason of any (alleged or actual) action or inaction
on the part of any predecessor or successor Trustee.
ARTICLE IX
PROHIBITION OF DIVERSION
(a) Except as provided in subparagraph (b) hereof, at no time prior
to the satisfaction of all liabilities with respect to
Participants and their successor in interest under the Plan
shall any part of the corpus or income of the Trust Fund be used
for, or diverted to, purposes other than for the exclusive
benefit of Participants or their successors in interest or for
defraying reasonable expenses of administering the Plan
including, but not limited, to the Trustee's fee.
(b) The provisions of subparagraph (a) notwithstanding,
contributions made by the Sponsor under the Plan shall be
returned to the Sponsor if the Sponsor certifies to the Trustee
in writing that one or more of the following conditions exists
and agrees to indemnify the Trustee for any loss, costs, damages
or expenses, including reasonable attorneys' fees, which the
Trustee may incur as a result of returning such contribution:
(i) a contribution was made by mistake of fact - such
contribution shall be returned to the Sponsor within one
year of the payment of such contribution;
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(ii) contributions to the Plan are specifically conditioned
upon their deductibility under the Internal Revenue Code
and a deduction has been disallowed - for any such
contribution, the amount disallowed shall be returned to
the Sponsor within one year after the disallowance of the
deduction. Contributions which are not deductible in the
taxable year in which made but are deductible in
subsequent taxable years shall not be considered to be
disallowed for purposes of this subsection; and/or
(iii) the Commissioner of Internal Revenue has determined that
the Plan is not initially qualified under the Internal
Revenue Code - any contribution made incident to that
initial qualification by the Sponsor shall be returned to
the Sponsor within one year after the date the initial
qualification is denied, but only if the application for
the qualification is made by the time prescribed by law
for filing the Sponsor's return for the taxable year in
which the Plan is adopted, or such later date as the
Secretary of the Treasury may prescribe.
For purposes of this Article IX, the term "Sponsor" shall
include other adopting employers under the Plan, to the extent
not inconsistent with the terms of the Plan.
ARTICLE X
AMENDMENT AND TERMINATION OF THE TRUST
10.1 AMENDMENT.
The Trustee may, by delivery to Sponsor of an instrument in writing,
amend this agreement at any time and such amendment shall become
effective on the date 60 days after delivery of such instrument, unless
the Sponsor delivers a written objection to the Trustee prior to the
expiration of such 60 day period. Provided, that no amendment shall
divert any part of the Trust Fund to any purpose other than providing
benefits to Participants and their successors in interest or defraying
reasonable expenses of administering the Plan.
10.2 TERMINATION.
If the Plan is terminated in whole or in part, the Trustee shall
distribute the Trust Fund or any part thereof in such manner and at
such times as the Plan Administrator or its designee shall direct in
writing. The Trust created hereunder will terminate upon the
distribution or application of all the assets of the Trust fund.
ARTICLE XI
MISCELLANEOUS PROVISIONS
11.1 NONALIENATION.
Except as otherwise required in the case of any qualified domestic
relations order within the meaning of Section 414(p) of the Internal
Revenue Code, the benefits or proceeds of any allocated or unallocated
portion of the assets of the Trust Fund and any interest of any
Participant or beneficiary arising out of or created by the Plan either
before or after
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the Participant's retirement shall not be subject to execution,
attachment, garnishment or other legal or judicial process whatsoever
by any person, whether creditor or otherwise, claiming against such
Participant or successor in interest. No Participant or successor in
interest shall have the right to alienate, encumber or assign any of
the payments or proceeds or any other interest arising out of or
created by the Plan and any action purporting to do so shall be void.
The provisions of this Section shall apply to all Participants and
successors in interest, regardless of their citizenship or place of
residence.
11.2 EMPLOYMENT.
Nothing contained in this Trust Agreement or in the Plan shall require
the Sponsor or any Adopting Employer to retain any employee in its
service.
11.3 CERTIFICATION OF TRUST AGREEMENT.
Any person dealing with the Trustee may rely upon a copy of this
agreement and any amendments thereto certified to be true and correct
by the Trustee.
11.4 GOVERNING LAW.
The construction, validity and administration of this agreement shall
be governed by the laws of the State of Alabama, except to the extent
that such laws have been specifically superseded by the Act.
11.5 SEGREGATION OF ASSETS.
To the extent not inconsistent with the requirements of Code Section
401(a) or the regulations thereunder, the Plan Administrator or its
designee may, if it so determines, at any time and from time to time,
designate any group or groups of the eligible employees or other
beneficiaries covered by the Plan as a separate class and may direct
the Trustee to segregate in a separate fund, to be held for the benefit
of such class, the part of the Trust Fund allocable to such class as
determined by the Plan Administrator or its designee. The Plan
Administrator or its designee shall cause the Trustee to effect such
segregation by delivering to the Trustee a written notice directing
such segregation. The Trustee may rely conclusively and without
investigation upon any such notice and shall segregate such assets as
the Plan Administrator may direct. The Trustee's valuation of such
assets for that purpose shall be conclusive. The Trustee shall hold all
of the assets so segregated under this provision, together with such
payments as shall thereafter be made to the Trust Fund in behalf of
such class, and the income therefrom, as a subpart of the Trust Fund
and subject to the terms of this agreement, or shall dispose of the
same as directed by the Plan Administrator. In the event that the Trust
Fund or any subpart thereof created by this agreement shall be
terminated as to such class, the Plan Administrator shall direct the
disposition of the assets held by the Trustee for such class through
transfer.
11.6 TITLES.
The titles to sections of this Trust Agreement are placed herein for
convenience of reference only, and the Trust Agreement is not to be
construed by reference thereto.
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11.7 COUNTERPARTS.
This Trust Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original but all of which
together shall constitute but one instrument, which may be sufficiently
evidenced by any counterpart.
11.8 SEVERABILITY.
If any provision of this Trust Agreement shall be held invalid or
unenforceable, such invalidity or unenforceability shall not affect any
other provisions hereof, and this Trust Agreement shall be construed
and enforced as if such provisions had not been included.
11.9 WRITTEN NOTICE.
Any written notice, demand, direction, or instruction given to the
parties to this Agreement shall be duly given if mailed or delivered:
(a) to the Trustee at β.β. βββ ββββββ, ββββββββββ, βββββββ,
βββββ-ββββ or any other address as shall be specified by the
Trustee in writing; and
(b) to the Sponsor, at the address indicated on the signature page
hereto.
11.10 CONFIDENTIALITY OF AGREEMENT.
This Agreement shall be considered and treated as confidential between
the Sponsor and the Trustee and shall only be provided to other persons
to the extent required by the Act.
ARTICLE XII
DEFINITIONS
As used in this Agreement of Trust, the following terms shall have the
meanings given below, unless a different meaning is clearly required by context.
12.1 "ACT" means the Employee Retirement Income Security Act of 1974, as
amended.
12.2 "AGREEMENT" means this Agreement of Trust, as set forth herein and as
subsequently amended pursuant to Section 10.1.
12.3 "CODE" means the United States Internal Revenue Code of 1986, as
amended.
12.4 "NAMED FIDUCIARY" means the Named Fiduciary appointed pursuant to the
Plan, but only with respect to the specific responsibilities for each
such fiduciary as described in the Plan.
12.5 "PARTICIPANT" means a participant in the Plan, as defined therein.
12.6 "PARTICIPANT LOAN" means a loan from the Trust Fund to a Participant
pursuant to the terms of the Plan.
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12.7 "PLAN" means the plan named on page 1 hereof.
12.8 "PLAN ADMINISTRATOR" means the plan administrator appointed pursuant to
the Plan and/or, whenever the Plan Administrator has delegated certain
of its duties to a Recordkeeper, the Recordkeeper.
12.9 "RECORDKEEPER" means the person or persons to whom the Plan
Administrator has delegated certain of its duties.
12.10 "TRUST" means the fiduciary relationship established hereunder with
respect to the Trust Fund.
12.11 "TRUST FUND" means all property received by the Trustee hereunder and
any property into which the same may be converted, together with the
income thereon, excluding amounts properly disbursed by the Trustee
under the terms hereof.
12.12 "TRUSTEE" means the Trustee or Trustees whose signatures are affixed to
this Amendment of Trust, and the Adoption Agreement, as trustee under
this Agreement of Trust, or any successor trustee acting hereunder.
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IN WITNESS WHEREOF, this Trust Agreement has been executed in behalf of
the parties hereto, all on the day and year first above written.
SPONSOR:
SAKS INCORPORATED
Attest: By:
----------------- -----------------------------------------------
Title:
--------------------------------------------
Address for receipt of notices:
βββ βββββββββ βββββββ
ββββββββββ, ββ βββββ
TRUSTEE:
AMSOUTH BANK
Attest: By:
----------------- -----------------------------------------------
Title:
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