📄 Extracted Text (16,134 words)
THE JUDAH INVESTMENT
TRUST AGREEMENT
Dated: 'De ce-rn 6t i 2i ZOW•
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TABLE OF CONTENTS •
ARTICLE PAGE
I : TRUST FUND 1
II : THE JUDAH INVESTMENT TRUSTS 2
III : SPECIAL DISTRIBUTION RULES • 8
IV : TRUSTEES' INVESTMENT AND ADMINISTRATIVE POWERS 12
V : RESTRICTIONS ON POWERS 22
VI : IRREVOCABILITY; MODIFICATION 23
VII : TRUSTEE DESIGNATIONS, RESIGNATIONS AND REMOVALS t 28
VIII : ACTION BY TRUSTEES 31
DC : LIABILITY AND INDEMNITY OF TRUSTEES 33
X : DEFINITIONS AND RULES OF CONSTRUCTION 34
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•
TRUST AGREEMENT made the 21st day of December, 2006 between LEON D.
BLACK, as Settlor, and LEON D. BLACK and JOHN J. HANNAN, as Trustees.
I: TRUST FUND
The Settlor hereby transfers to the Trustees the property listed on Schedule A
annexed hereto. The Trustees acknowledge receipt of such property and agree to hold such
property in trust and to manage and dispose of it in accordance with the provisions of this Trust
Agreement. This property shall be the original Trust Fund of a Trust for the benefit of the Settlor
and the Beneficiaries, the dispositive terms of which are set forth in Article H. This Trust may
be identified as the "JUDAH INVESTMENT TRUST A."
The Settlor may transfer additional property to the Trustees. Each property that is
the subject of an additional transfer to the Trustees shall be held by them in a separate Trust for
the benefit of the Settlor and the Beneficiaries, the dispositive terms of which are also set forth in
Article II. Each such property shall be described in a Schedule which shall be signed by the
Settlor and the Trustees and affixed to this Trust Agreement. Such Schedule shall also set forth
(1) a name for the Trust, (2) the percentage or method to be used to establish the Initial Annuity
Payment and each subsequent annuity payment applicable to such Trust, and (3) the day on
which the Trust Term of the Trust shall end.
This Trust Agreement may be identified as the "JUDAH INVESTMENT TRUST
AGREEMENT." The Trusts together may be identified as the "JUDAH INVESTMENT
TRUSTS." The Beneficiaries under this Trust Agreement at any particular time are those of the
Senior's spouse and the Senior's issue who are then living. The definitions of the other terms
used in this Trust Agreement are set forth in Article X or where they first appear.
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II: THE JUDAH INVESTMENT TRUSTS
Following are the dispositive provisions of each of the JUDAH INVESTMENT
TRUSTS.
(A) Trust Term. The term of each Trust (the "Trust Term") shall commence
on its Trust Creation Date. The term of the JUDAH INVESTMENT TRUST A shall continue
until the day before the second (2nd) anniversary of its Trust Creation Date. The term of each
. other Trust held under this Trust Agreement shall end on the day set forth in the Schedule
applicable to such Trust.
(B) Annuity. (1) During the period fuming from the Trust Creation Date to
the day before the first (1tt) anniversary of the Trust Creation Date, the Trustees shall pay to the
Senior an amount equal to the Initial Annuity Payment applicable to the Trust in such
installments as may be convenient to the Trustees, provided, however, that the entire Initial
Annuity Payment shall be paid to the •Settlor no later than the day before the first (1st)
anniversary of the Trust Creation Date. During the period running from the first anniversary of
the Trust Creation Date to the day before the second (2nd) anniversary of the Trust Creation
Date, unless otherwise specified in the Schedule applicable to the Trust, the Trustees shall pay to
the Settlor an amount equal to one hundred twenty (120%) percent of the Initial Annuity
Payment, provided, however, that the entire Annuity Payment shall be paid to the Settlor no later
than the day before the second (2nd) anniversary of the Trust Creation Date. The payments the
Trustees are required to make to the Settlor are referred to as "Annuity Payments," and each
required payment is referred to as an "Annuity Payment." The Trustees' obligation to pay the
Annuity Payments to the Settlor shall not terminate on the Settlor's death.
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(2) In determining the amount of each Annuity Payment, assets shall be
valued at their values as of the Trust Creation Date as finally determined for federal gift tax
purposes.
(3) The Initial Annuity Payment applicable to the JUDAH INVESTMENT
TRUST A shall be such percent of the initial fair market value of the Trust Fund as finally
determined for federal gift tax purposes that, when increased by twenty (20%) percent each
subsequent year in accordance with the provisions of subsection (1), results in the Settlor's right
to receive the Annuity Payments having a value equal to NINETY-NINE and NINETY-NINE
HUNDREDTHS PERCENT (99.99%) of the fair market value of the Trust Fund of the Trust as
finally determined for federal gift tax purposes. The Initial Annuity Payment applicable to any
other Trust held under this Article shall be equal to the percentage set forth or described in the
Schedule applicable to such Trust as described in Article I multiplied by the initial fair market
value of the Trust Fund of such Trust as finally determined for federal gift tax purposes or shall
be determined in accordance with a method set forth in such Schedule.
(C) Mandatory Income Payments to Settlor. (1) Each year the Trustees shall
distribute to the Settlor an amount equal to the excess of the Trust Accounting Income over the
Annuity Payment payable to the Settlor in such year.
(2) For purposes of this Article, the term "Trust Accounting Income" shall
mean any distribution received by the Trust with respect to an interest in any of the Relevant
Companies held in the Trust to the extent such distribution is derived from the Operating Profits
of any such Relevant Company. For purposes of this Article, the term "Operating Profits" shall
mean net profits for any year without taking into account any items of income, gain, loss or
deduction generated or incurred in connection with a transaction constituting a Distribution
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Event. For purposes of this Article, the term "Distribution Event" shall be interpreted broadly,
and shall mean an extraordinary transaction (or a series of related transactions) involving any one
or more of the Relevant Companies, whether occurring directly or indirectly, that constitutes a
sale to, or material investment by, a Third Party Investor, in circumstances in which one or more
members or partners of the Relevant Companies receive Distributions (or sales proceeds in
respect of their interests) as a result of, or in connection with, such extraordinary transaction (or
series of related transactions). For purposes of this Article, the term "Distributions" shall mean
all distributions made by any Relevant Company to its members or partners, whether in cash,
property, dividends or distributions upon the occurrence of a dissolution of such Company or
otherwise. For purposes of this Article, the term `Third Party Investor" shall mean a PerSon who
is not a private equity professional employed by a Relevant Company and wh6 makes an
investment in the Relevant Company in circumstances designed to monetize one or more of the
equity interests in any Relevant Company.
(3) For purposes of this Article, the term "Relevant Companies" shall mean
all of the following entities, including any of their subsidiaries or successors in interest (whether
by way of merger, exchange of interests or otherwise): Apollo Management, L.P., Apollo
Management IV, L.P., Apollo Management V, L.P., Apollo Management VI, L.P., Apollo
Investment Management, L.P., Apollo Value Management, L.P., Apollo SVF Management, L.P.,
Apollo Asia Management, L.P., Apollo Europe Management, L.P., and Apollo Altemative
Assets, L.P.
(D) Source of Payment. (1) The Annuity Payments shall be paid from Trust
Accounting Income (as defined in this Article) and to the extent Trust Accounting Income is
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insufficient, from income and, to the extent income is insufficient, from principal. Any income
of a Trust for a taxable year not so paid shall be added to principal.
(2) The Trustees shall not issue (a) a note or other debt instrument, (b) an
option, or (c) any other similar financial arrangement in satisfaction of their obligation to pay the
Annuity Payments.
(E) Adjustment. If the initial fair market value of the Trust Fund of a Trust is
incorrectly determined by the Trustees, then within a reasonable period after the value is finally
determined for federal tax purposes, the Trustees shall pay to the Settlor in the case of an
undervaluation, or shall receive from the Settlor in the case of an overvaluation, an amount equal
to the difference between the amounts properly payable and the amounts actually paid, plus, if
required by the Code, interest, compounded annually, computed for any period at the rate of
interest that the federal income tax regulations prescribe for such Trust for such computation for
such period. Similarly, if the value of assets other than cash distributed by the Trustees in
satisfaction of an Annuity Payment is incorrectly determined by the Trustees, then within a
reasonable period after the value of such assets is finally determined for federal gift tax purposes,
the Trustees shall pay to the Settlor, in the case of an undervaluation, or shall receive from the
Settlor, in the case of an overvaluation, an amount equal to the difference between such Annuity
Payment and the value of the assets actually distributed in satisfaction of such Annuity Payment,
plus, if required by the Code, interest compounded annually, computed for any period at the rate
of interest that the federal income tax regulations prescribe for such Trust for such computation
for such period.
(F) Termination. Each Trust shall terminate on the last day of its Trust Term.
Upon such termination, the Trustees shall dispose of the Trust Fund remaining after payment of
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all of the Annuity Payments and any interest thereon (the "Trust Fund Balance") as provided in
this section. Any disposition of the Trust Fund Balance pursuant to this section shall be subject
to an obligation to repay to the Trustees any amount that the Trustees are required to pay to the
Settlor pursuant to section (E) of this Article. The Trust Fund Balance shall be disposed of as
follows: If the Senior is not living on the last day of the Trust Term and any portion of the Trust
Fund is includible in the Settlor's gross estate for federal estate tax purposes, the portion so
includible shall be paid (i) to such one or more Persons, other than the Settlor, the Settlor's
estate, the Settlor's creditors or the creditors of the Settlor's estate, either outright or in further
trust, upon such terms and conditions (including the granting to the appointee of a further and
general or limited power of appointment), as the Settlor shall appoint by Will or by a written
instrument that is delivered to the Trustees at a time when the Settlor is competent: that makes
specific reference to this section, and that is sighed and acknowledged by the Senior, or, to the
extent the Settlor fails to exercise this power of appointment, (ii) to DEBRA if DEBRA is then
the Settlor's spouse. The balance of the Trust Fund shall be paid (i) to the trustees then in office
of the trust known as the "BLACK 2006 FAMILY TRUST," for the benefit of the Settlor's
spouse and the Settlori issue living from time to time; created under article Ii of a trust
agreement executed on the date hereof, by and between the Settlor, as settlor, and the Senior and
JOHN J. HANNAN, as trustees, known as the "BLACK 2006 FAMILY TRUST
AGREEMENT," who shall add the same to the principal of the BLACK 2006 FAMILY TRUST
and dispose of the same therewith, or if the BLACK 2006 FAMILY TRUST is not then in
existence, (ii) in equal shares to the Settlor's Children living on the last day of the Trust Term, or
if none of the Settlor's Children is living on such day, (iii) to the Settlor's issue living on such
day, per stirpes, provided that the share of each such issue shall not be paid to him or her
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outright, but shall instead be held in a separate trust for his or her benefit under this Trust
Agreement upon the terms set forth in article III of the BLACK 2006 FAMILY TRUST
AGREEMENT and any other relevant provisions of the BLACK 2006 FAMILY TRUST
AGREEMENT that would govern such trust if it were held under the BLACK 2006 FAMILY
TRUST AGREEMENT.
(G) No Additions. No additional contributions may be made to any Trust after
the initial contribution to such Trust as described in Article I. If the Settlor, notwithstanding this
provision, makes any direct or indirect transfer to any Trust other than the transfer of the
property described in Article I, the Trustees shall promptly return to the Settlor the property that.
was the subject of the transfer or an amount equal to the fair market value of the property that
was the subject of the transfer.
(H) No Payments to Others. No payment or application of any portion of the
Trust Fund of any Trust shall be made at any time before the termination of such Trust to or for
the benefit of any person other than the Settlor.
(I) No Commutation. The interests of the Settlor shall not be subject to
commutation.
(J) Overriding Provision. It is the Settlor's intention that the Settlor's right to
receive the Annuity Payments qualifies as a "qualified annuity interest" within the meaning of
2702(b)(1) of the Code and the Treasury Regulations promulgated thereunder. Accordingly,
no authorization or direction or other provisions contained in this Trust Agreement that would
prevent the Settlor's right to receive the Annuity Payments from so qualifying shall apply to any
Trust, it being the Settlor's intention that any court having jurisdiction over this Trust Agreement
construe it accordingly. The Settlor understands that if the Settlor dies before any date or dates
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on which any payments are required to be made to the Settlor or by the Senior under this Trust
Agreement or before any of such required payments have been made, such payments shall be
made to or by the Senior's Personal Representatives.
(K) Modification. Any provision of this Trust Agreement to the contrary
notwithstanding:
(1) the Trustees shall modify this Trust Agreement in any manner required for
the sole purpose of ensuring that the Settlor's right to receive the Annuity Payments qualifies as
a "qualified annuity interest" within the meaning of § 2702(b)(1) of the Code and the Treasury
Regulations promulgated thereunder; and
(2) the Independent Trustees shall have such power to modify the terms of
this Article, other than this section (K), in the manner provided in Article VI as (i) will not cause
the Settlor's right to receive the Annuity Payments to be disqualified as a "qualified annuity
interest" within the meaning of § 2702(b)(1) of the Code and the Treasury Regulations
promulgated thereunder; (ii) will not cause any change in the valuation of any interest in a Trust
for federal gift or estate tax purposes; and (iii) is permitted by Article VI .(without regard to
paragraph (m) of subsection (B)(I) of Article VI).
III: SPECIAL DISTRIBUTION RULES
(A) Beneficiaries Under a Legal Disability. (1) Distribution of any money or
other property from any Trust to an individual who is under a legal disability may, in the sole
discretion of the Trustees, be made directly to that individual, or to any Person (including a
Trustee) who is that individual's parent or that individual's guardian, conservator or similar
fiduciary in whatever jurisdiction appointed and however denominated.
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(2) Any receipt or release furnished by a Person who receives a distribution
pursuant to this section on behalf of a beneficiary shall fully release and discharge the Trustees
with respect to such distribution, even though the Person furnishing such receipt or release is a
Trustee.
(3) Notwithstanding the preceding provisions of this section, no distribution
of property pursuant to this section may be made to the Settlor in any capacity.
(B) Adopted, Out-of-Wedlock and Posthumously Conceived Children. (1)
An individual legally adopted on or before his or her nineteenth (19th) birthday shall be deemed
to be a descendant of his or her adoptive parent or parents, and shall be deemed not to be a
descendant of a parent of his or hers who consented to such adoption unless the adoption did not
terminate such parent's rights as a parent, or unless such parent also adopted such individual.
(2) Except as provided in subsection (3) and Article X(A)(20), the adoption of
an individual after his or her nineteenth .(19th) birthday by an adoptive parent other than the
Senior shall be ignored for purposes of determining his or her status as a descendant of any
individual.
(3) An individual who is the genetic child of parents who were not married to
each other at the time of his or her birth shall be deemed not to be a descendant of his or her
genetic father (a) unless the father. (i) marries his or her mother or was married to his or her
mother at any time during the period starting at the time of such individual's conception and
ending at the time of his or her birth, (ii) adopts the individual at any time, or (iii) acknowledges
his paternity of such individual in a signed instrument filed with any court or governmental
agency or delivered to any Trustee of a Trust held under Article U during such father's lifetime,
or (b) unless subsection (5) applies.
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(4) Except as provided in subsection (5), an individual who is the genetic
child of parents who were not maned to each other at the time of his or her birth shall be
deemed to be a descendant of his or her genetic mother unless she has no legal rights. as a parent
of such child under local law.
(5) An individual who is the genetic child of a parent who was deceased at the
time of such individual's conception shall be deemed to be a descendant of such parent only if (i)
such individual was born within the two (2) year period after such parent's death and befOre the
Perpetuities Date, (ii) such parent gave permission for the use of his or her genetic material to the
surviving parent in connection with the conception of such individual by such parents in an
instrument that was signed by the deceased parent, and (iii) such deceased parent (if living)
would have had legal rights as a parent of such child upon his or her birth under local 'law.
(6) An individual who is deemed to be a descendant of his or her adoptive
parent by reason of adoption shall be deemed to be a descendant of all ancestors of such parent.
An individual who is deemed not to be a descendant of a parent of his or hers who consented to
his or her adoption by another shall be deemed not to be a descendant of any ancestor of such
consenting parent unless such individual is a descendant of such ancestor without regard to his or
her relationship to such consenting parent. An individual who is deemed not to be a descendant
of his or her parent pursuant to subsection (3) or (4) shall be deemed not to be a descendant of
any ancestor of such parent unless such individual is a descendant of such ancestor independent
of his or her relationship to such parent.
(C) Survivorship. Any beneficiary whose entitlement to property (whether
income or principal and whether outright or in trust) under this Trust Agreement depends upon
his or her surviving the occurrence of some event who dies under such circumstances that it is
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difficult or impossible to determine whether or not he or she was alive upon the occurrence of
such event shall be deemed for all purposes of this Trust Agreement to have died prior to the
occurrence of such event.
(D) [Indisposed of Property. If upon the occurrence of any event any share of
a terminated Trust shall not be completely disposed of by the other provisions of this Trust
Agreement, then such undisposed of share shall be paid to those individuals who would have
inherited it from the Settlor, and in the same proportions in which they would have shared it, had
the Settlor then died intestate, unmarried, the owner of it, and a resident of the State of New
York.
(E) Judicial Intervention. Under no circumstances shall § 7-1.6 of the EPTL
or any similar provisions of law apply to any Trust.
(F) Statutory Reimbursement. Under no circumstances shall § 7-1.11 of the
EPTL or any similar provisions of law apply to any Trust if its application to such Trust would
cause any portion of the Trust Fund of such Trust to be subject to the claims of the Senior's
creditors.
(G) Exercise of Powers of Appointment. With' regard to the power of
appointment granted under this Trust Agreement that may be exercised by the Will of the Settlor,
the Trustees may rely on any instrument purporting to be a certified copy of the Will of the
Senior. Commencing six (6) months after the death of the Settlor, the Trustees (if they have no
actual notice of the existence of the Will of the Senior that exercises such power), shall incur no
personal liability for administering the Trust as though the Settlor had not exercised the power.
If the Will that exercises the power is subsequently discovered, any disposition of the Trust
property by the Trustees shall be without prejudice to the rights of any appointee to recover the
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property from any Person to whom the Trustees have paid assets of the Trust or from the
Trustees (in their capacities as Trustees) to the extent of any remaining Trust property. The
exercise of a power of appointment granted under this Trust Agreement by the Will of DEBRA
shall be valid only if DEBRA is the Settlor's spouse at the time of DEBRA' s death.
IV: TRUSTEES' INVESTMENT AND
ADMINISTRATIVE POWERS
(A) Overriding Limitation on Powers. The provisions of this Article are
expressly subordinate to the overriding provisions of Article V and section (J) of Article II.
(B) General Powers. The Trustees shall have all powers and discretion
conferred generally upon fiduciaries by EPTL § 11-1.1 and by other provisions of law. Without
limiting the foregoing, the Trustees shall also have the following powers and discretion as to all
property of whatever kind at any time held by them, including income held by them, until final
distribution, which they may exercise as they deem advisable:
(1) To sell, purchase, exchange, invest and reinvest in bonds, preferred
or common stocks, mortgages, mutual funds or money market funds, interests in
any kind of investment trust, partnership or limited liability company, or other
evidences of rights, interests or obligations, secured or unsecured, foreign or
domestic, or any other property, real or personal and whether or not in the nature
of a wasting asset, without any duty to diversify investments, and fully free of any
and all restrictions imposed by law upon the investment of funds held by a
fiduciary; and to retain the same for any period of time without liability therefor;
(2) To employ such one or more agents, accountants, custodians,
experts and counsel, legal or investment (including any firm with which any of
the Trustees may be affiliated), as the Trustees shall determine, to delegate
discretionary powers to them, to rely upon information or advice furnished by
them, and to compensate them out of the Trust Fund of the Trust or Trusts on
behalf of which the engagement was made (and not out of the Trustees'
commissions);
(3) To improve, lease for any term (whether or not such term is
beyond the term of the administration of the Trust which is the lessor or the term
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fixed by any law) to any Person including the Senior, partition or otherwise deal
with or dispose of any real or personal property or any interest therein; to
demolish or to make alterations in and extraordinary improvements to any
building now or hereafter located on any such property; to construct new
buildings; and to enter into contracts or grant options (for any period) as to any•of
the foregoing;
(4) To consent to the modification, renewal or extension of any note,
whether or not secured, or any bond or mortgage, or any term or provision
thereof, or any guarantee thereof, or to the release of such guarantee; to release
obligors on bonds secured by mortgages or to refrain from instituting suits or
actions against such obligors for deficiencies; to use property held under this
Trust Agreement for the protection of any investment in real property or in any
mortgage on real property;
(5) To abandon any property, real or personal, that they deem to be
worthless or not of enough value to warrant keeping or protecting; to abstain from
the repairs, maintenance and upkeep of such property, and from the payment of
taxes, water rents, and assessments regarding such property; to permit such
property to be lost by tax sale or other proceeding, or to convey it for nominal or
no consideration;
(6) To exercise or dispose of any or all options, privileges or rights of
any nature appurtenant or incident to the ownership of any property, including but
not limited to rights to vote, assent, subscribe or convert; to become a party to, or
deposit securities or other property under, or accept securities issued under, any
voting trust agreement;
(7) To assent to or participate in any reorganization, readjustment,
recapitalization, liquidation, partial liquidation, consolidation, merger, dissolution,
sale. or purchase-of assets, lease, mortgage, contract or other action or proceeding
by any corporation and, in that connection, to subscribe to new securities, to
exchange any property for any other property, and to pay any assessments or other
expenses; to delegate discretionary powers to any reorganization, protective or
similar committee;
(8) To borrow money from any party, including the Senior or any of
the Trustees, for any purpose whatsoever, and to give or not to give security for
the loan;
(9) To consent, or to decline to consent, to the election (including any
that is now in effect) by any corporation to be taxed under subchapter S of the
Code or any comparable provision under state law;
(10) To make any loans, either secured or unsecured, in such amounts,
and upon such terms as to interest and repayment, and to such Persons (including,
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but not limited to, the Personal Representatives of any estate and the trustees of
any trust), as they determine in their discretion, and, in the case of a loan to any
estate or trust, irrespective of whether any beneficiary, Personal Representative or
trustee of any such estate or trust is a beneficiary or Trustee under this Trust
Agreement; provided that all loans shall be made at a reasonable rate of interest;
(11) To purchase assets at their fair market value from any estate or
trust, upon such terms and conditions as they shall determine, and irrespective of
whether any beneficiary, Personal Representative or trustee of such estate or trust
is a beneficiary or Trustee hereunder;
(12) To sell, liquidate, incorporate or carry on (for any period) any
business which is or was conducted by the Settlor or in which the Senior is or was
interested as shareholder, partner or otherwise;
(13) To hold property in the name of a nominee or unregistered or in
such form as will pass by delivery;
(14) To remove all or part of the assets or change the situs of
administration of any Trust from one jurisdiction to another jurisdiction, and to
elect, by an instrument signed by the Trustees of such Trust and filed with the
records of such Trust, that the law of such other jurisdiction shall thereafter
govern the same to such extent as may be necessary and appropriate, at any time
or from time to time (and any number of times) as they deem advisable;
(15) To satisfy any disposition or effect any distribution of income or
principal with any property, including an undivided interest in property, in kind or
in cash or partly in each to any one or more beneficiaries, whether or not the same
kind of property is distributed to other beneficiaries having comparable interests;
.):74;:c • (10 __To credit receipts (including,. but not Jimited to, gains from the sale _
or exchange of property) and to charge expenditures and other disbursements to or
between income and principal in such amounts and proportions as the Trustees
deem advisable, without regard to any prior allocation made at any time and
notwithstanding any contrary provision of law;
(17) To open and maintain bank accounts and brokerage accounts;
(18) To do any and all acts, to exercise any and all rights, to enter into
any and all proceedings, contracts (including contracts containing guarantees,
warranties, representations and indemnifications of any kind or nature), and other
instruments (whether or not specified above and including but not limited to the
preparation and filing of any and all registration statements and papers,
documents and instruments of whatever kind and nature with the Securities and
Exchange Commission and the payment of any and all expenses in that
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connection) necessary or proper in their opinion in the administration of any Trust
as fully as if they were the absolute owners of such property; and
(19) To engage on behalf of any Trust in any type of security,'
commodity or currency transaction (including, without limitation, short sales,
purchases on margin and over-the-counter and private transactions); to buy and
sell any type of option contract (including, without limitation, so-called puts,
calls, and straddles), or any combination of any types of option contract, relating
to securities, commodities or currencies; to purchase quantities of any commodity
or currency for present or future delivery; to borrow all or any part of the
purchase price; and in the case of any such commodity purchase, to make all
arrangements that the Trustees of such Trust deem advisable for the storage,
maintenance and preservation of the commodity so purchased, and to pay all
storage expenses, carrying charges and other expenses incurred in connection
therewith out of such Trust; and to sell quantities of any commodity or currency
for present or future delivery.
(C) Exoneration of Third Parties. (1) No Person dealing with the Trustees
shall be bound to see to the application or disposition of cash or other property transferred to
them or to inquire into the authority for or propriety of any action by the Trustees.
(2) Every Person contracting or otherwise dealing with the Trustees of a Trust
shall look only to the funds and property of such Trust for payment under such contract or
payment of any money that may become due or payable under any obligation arising under this
Trust Agreement, in whole or in part, and the Trustees shall not be individually liable therefor
even though the Trustees did not exempt themselves from individual liability when entering into
any contract, obligation or transaction in connection with or growing out of such Trust.
(D) Consolidation of Trust Property. The Trustees shall not be required to
segregate physically the property of multiple Trusts; but may, in their discretion, maintain any
part or all of the trust property of any two or more Trusts in one or more consolidated funds, in
which event the division of each such consolidated fund into the various shares or parts
comprising it need be made only on the Trustees' books of account.
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(E) Powers Relating to Closely Held Business and Investment Interests. (I)
As to each and any Entity, public or private, in which the Trustees, as such, hold or acquire,
directly or indirectly, an equity interest, if the fair market value of such•interest of the Trustees
when aggregated with the fair market value of the equity interests in such Entity of the trustees
of all other trusts of which the Settlor or DEBRA is the settlor, exceeds one percent (1%) of the
fair market value of such Entity, such Entity being hereinafter referred to as "the Closely Held
Entity," the Trustees are hereby authorized to retain the shares thereof or interest therein for as
long as they deem to be in the best interests of any Trust, regardless of the fact that such shares
or interest might produce no income, regardless of any duty to diversify investments, and
notwithstanding any other fiduciary obligation which might require them to dispose' of such
shares or interest.
(2) With respect to each and every Closely Held Entity, the Trustees of any
Trust are authorized, to the extent permitted by law, to exercise their rights and powers as
holders of the shares or other interests in such Closely Held Entity to effect its continued
operation, or the sale or other disposition of its assets or business, or, in their sole discretion, to
sell, exchange, offer for redemption;or otherwiie dispose of the shares of or other interests in the
Closely Held Entity owned by any Trust, or to effect the liquidation or dissolution of the Closely
Held Entity, at such time or times and upon such terms and conditions as the Trustees, in their
sole discretion, shall determine.
(3) The Trustees may participate in the management of any Closely Held
Entity to the extent that their interest therein permits. They are expressly authorized (without
limiting the generality of the foregoing), in their sole discretion, to select, vote for and remove
directors of the Closely Held Entity (if the Closely Held Entity is a corporation); to name or
NYIMINMOMMVSKUMID0026504.00WI
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EFTA01127705
change officers, managing personnel and/or operating personnel; to reduce, expand, limit or
otherwise change the Closely Held Entity's trade or business, or any property or investment that
it holds; to require surety bonds of employees and/or officers and specify the amount of such
bonds and the bonding company; to employ accountants or engineers to appraise or evaluate the
Closely Held Entity's business or assets; to employ investment or legal counsel, including any
firm with which a Trustee may be affiliated; to charge the costs of such services against the
interest in the Closely Held Entity owned by any Trust, or to require the Closely Held Entity to
pay such costs; to contribute additional working capital or to subscribe to additional stock as they
may see fit; and to take all steps and perform all acts which they shall deem necessary or
advisable in connection therewith.
(4) Notwithstanding the provisions of the preceding subsection, the Trustees
shall not be bound or required to take part in the management of any Closely Held Entity. They
may delegate their managerial authority (including any authority to determine the payment or
non-payment of dividends or other distributions) to others, whether by means of .employment
agreements or other arrangements, and they may enter into voting trusts and grant irrevocable
. _
proxies, as they deem advisable. In the event of such delegation, the Triistees shall not be liable'
for any act or omission by the directors or other Persons charged with such management, unless
they know or have reason to know of any act of dishonesty, misappropriation or misapplication
of moneys or other property on the part of such directors or other Persons. No Person having an
interest hereunder shall be entitled in any way to compel, control or forbid the exercise in any
particular manner of any voting or other right with regard to the Closely Held Entity which may
at any time be vested in the Trustees.
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EFTA01127706
(5) Any one or more of the Trustees may act as officer, partner, director,
manager or senior employee of the Closely Held Entity (each such capacity being hereinafter
referred to as a "Management Position"), and the Trustees are specifically authorized to
participate in the election or appointment of any Person or Persons, including themselves
(whether individually and/or as Trustees), to any Management Position. Any Trustee who serves
in a Management Position shall be entitled to receive compensation for such services
notwithstanding that the Trustees may themselves (whether individually and/or as Trustees) be in
a position to determine, or control the determination of, the amount of such compensation, and
no such Person shall be required to furnish any bond in connection with any such service in a
Management Position.
(6) The Senior is aware that conflicts of interest may arise by reason of a
Trustee's serving as such while simultaneously serving in a Management Position, or by reason
of a Trustee's owning or purchasing an interest in the Closely Held Entity in his, her or its own
right, and the Settlor intends that the Trustees shall, in all respects, be free to exercise the powers
and discretion herein conferred as fully and unrestrictedly as if there were no conflicting
interests. Consequently, the Trustees are .heiebY expressly exempted from the adverse operation
of any rule of law which might otherwise apply to them in the performance of their fiduciary
duties solely by reason of self-dealing or other conflict of interest ("conflict of interest rules").
In particular, the Trustees are authorized to enter into any transaction with any
Entity that any Trust could enter into with any unrelated third Person, without regard to any
conflict of interest rule. The transactions described in the preceding sentence shall include,
without limitation; (i) the purchase of property from, sale of property to or exchange of property
with any Closely Held Entity and (ii) the borrowing of money or other property from or lending
NY! A147040510MVSK1031.1)OO.26.104 0001
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EFTA01127707
of money or other property to any Closely Held Entity. The Trustees may employ, on behalf of
any Trust, agents, accountants, custodians, experts and legal or investment counsel who may also
perform comparable services for the Closely Held Entity or for any one or more of the Trustees
individually. In addition, any Trustee may purchase, sell, exchange or otherwise deal .in or
dispose of shares of or interests in the Closely Held Entity for his, her or its own account without
regard to any conflict of interest rule, or any other rule that might otherwise require such Trustee
to first offer the opportunity to enter into that transaction to any Trust of which he, she or it is a
Trustee.
(7) To the greatest extent permitted by law, no Trustee holding a Management
of
Position in a Closely Held Entity shall be required to account for the acts and proceedings
such Closely Held Entity to any Person at any time interested in any Trust, regardlesi of whether .
the interest of such Trust in such Closely Held Entity, alone or in conjunction with other trusts of
which such Trustee is a trustee, is a controlling interest.
(8) For purposes of this section, (i) the Trustees will be deemed to hold an
interest in an Entity if they hold, as such, a direct or an indirect interest in such Entity, and (ii)
the Trustees will be deemed to h.old an indirect interest in an Entity if they hold, as such, a direct
interest in another Entity that owns a direct or indirect interest in such Entity. The extent of such
indirect interest shall be measured by the multiplication of percentage interests through a chain
fair
of Entities. For example, if the Trustees hold a direct interest in an Entity ("Entity A") the
market value of which constitutes fifty percent (50%) of the fair market value of Entity A and
which
Entity A owns a direct interest in another Entity ("Entity B") the fair market value of
constitutes thirty percent (30%) of the fair market value of Entity B, such Trustees would be
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EFTA01127708
•
deemed to hold an indirect interest in Entity B the fair market value of which constitutes fifteen
percent (15%) of the fair market value of Entity B.
(F) Special Investments and Risk. The Trustees shall have broad latitude to
make and retain investments in real and personal property that are not ordinarily considered
suitable for fiduciaries under the usual fiduciary investment standards and that may be
speculative and involve unusual risks, including, without limitation, interests in any kind of
business venture or enterprise, real estate development, mineralS, commodities, and natural
resources. The Trustees, at any time or from time to time as they deem advisable, in their sole
discretion, may initiate such investments on behalf of any Trust, even though there may be a risk
of loss to such Trust by reason thereof.
Any investment may (notwithstanding any law or rule of law making trustees'
powers non-delegable or any other law) take the form of the securities of a corporation, a general
or limited partnership interest, membership in a limited liability company, an interest in a joint
venture, a future interest in property, shares of beneficial interest in a business trust, or any. other
form of investment, direct or indirect, even though there may be a limited market, or, in practice,
no effective market, for the disposition of such investment. To this end, the Senior authorizes
the Trustees of any Trust to enter into any such investments with the trustees of any other trust.
(G) Term and Remainder Interests. The Trustees may make investments in
the form of term interests in property (the right to possess or to receive income from property for
a designated number of years or for the life of a designated individual) or in the form of
remainder interests in property (the right to receive property after the
ℹ️ Document Details
SHA-256
7d75f74150bad9897d1a486a31511a7744673c370cf487c983e866a1f01d0cfc
Bates Number
EFTA01127688
Dataset
DataSet-9
Document Type
document
Pages
55
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