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HomeMy WebLinkAbout06-26-07 ~ SNELBAKER S BRENNEMAN, P.C. A PROFESSIONAL CORPORATION ATTORNEYS AT LAW 44 WEST MAIN STREET MEGIANICSBURG, PENNSYLVANIA 17055 RICHARD C. SNELBAICER. KEITH O. BRENNEMAN 717-697-8528 June 26, 2007 TO: Register of Wills of Cumberland County Re: Estate of Neil A. O'ponnell No. 2006-00805 P. O. BOX 318 fACSIMILE (717) 697-7681 (") S;o ". :xJ 03-0 fl.] :;'-1: (") {~-~~h; -':'~~:D < u5^ .qo ( )\_.;11 fJ~;5 "'J --I :i> Please cause the attached copy ofNeilA. o"ponnell Trust to be filed in the above captioned Estate. . SN~ P. C. By '.' 'I~~ _ .RichudC. Snelbaker Attorneys for Estate of Neil A. O'Donnell, Deceased. ~ c:;:) <;:::) ....... <- c.: :z: N 0'\ :::D -nrn Fi'iO (;:>.0 i: /5 :]:J ---.j CJ [':1,1'1 ';U CJ ,"-~O ""fi '-1'1 ~.;: :!J "'."0 r~ fn . V?~ .j . '. .,,~'j""'.~,:if:ii:; .. ~ ~~ ". ~ }.- -~.*-,~ -0 :x N N W t~. ..' ..:;....;~L....: NElLA. O'DONNELL TRUST .I June25~ 2003 o Co ~I;g fll-CO f2~ }:;: h=i ??: 0 ~ ':..:700 C-) 0 -i, o~ - -A-' -0-1 ).;.~ ,...., c:::> = --.l <- C Z N ()"\ The trustee of a trust may have duties and responsibilities in addition to those described in the instrument creating the trust. If you have questions, you should obtain legal advice. Prepared by Stephen Connelly, Esq. 2770 Indian River Blvd. Suite 323 Vero Beach, Florida 32960 772-563-0566 -0 :n ITl i110 C;"JC::> ~::j ~~ iTim ::0 CJ c)a -'r-j -r, -n F"5 r - r.' <...f.: (-) 7J ~, ~, ....". -~ N .. N W , ~ NEIL A. O'DONNELL TRUST NEIL A. O'DONNELL, as Grantor, hereby creates the Neil A. O'Donnell Trust ("the Trust") on June 25,2003. The Grantor is the trustee of this Trust and, in that capacity, the Grantor and his successors are collectively referred to in this Trust as the "Trustees." ARTICLE 1 FAMiLY J . The Grantor is not married. The Grantor is a citizen.iofthe United"States. The Grantor has been previously married and has five children from that marriage, NEIL F. O'DONNELL, KATHLEEN A. O'DONNELL,' SHl!ltA O'DONNELL BRODERICK, NANCY O'DONNELL KlEL Y, and EILEEN ROSENaERG. References to "the Grantor's children" mean the Grantor's children named above, except the Grantor's daughter EILEEN ROSENBERG, whom the Grantor expressly excludes fr.om any provision of this Trust and who, along with her descendants, is to receive no benefit under it; references to "the Grantor's descendants" mean the Grantor's children,named above and their descendants (except the Graritor's daughter EILEEN ROSENBERG and her descendants). ARTICLE 2 TRANSFERS TO TRUST The Grantor hereby conveys to the Trustees Ten Dollars ($10), which together with any assets later added to this Trust are referred to as the "Trust Estate." Any person may transfer assets to the Trust Estate, if the Trustees agree to accept them. Unless otherwise specified in writing at the time of the transfer, those assets will be held as provided in this Trust. The Trustees acknowledge receipt of the current Trust assets and agree to hold the Trust Estate as set forth in this Trust. ARTICLE 3 RESERVED RIGHTS The Grantor reserves the following personal rights with respect to the Trust during his lifetime: · To amend or revoke this Trust; · To remove a Trustee and to designate a new Trustee; · To withdraw assets, whether income or principal, from the Trust Estate; · To require changes in the investments of the Trust Estate, but investments made by the Grantor are not subject to review by the Trustees unless the Grantor's personal rights are suspended under Section 3.2; · To direct the Trustees to perform any act of administration; and · To direct the Trustees to make distributions to any person named by the Grantor. 3.1 By Whom Exercisable. These rights may be exercised at any time by an instrument signed by the. Grantor personally, and cannot be exercised by any guardian who may be appointed for the Grantor, except that the Grantor's legal guardian or the holder of the Grantor's durable power of attorney may amend (but not revoke) this Trust only to the extent necessary to preserve a tax deduction, exemption, or credit consistent with the Grantor's beneficial intentions as stated in this Trust. The Trustees are to be held harmless . I and indemnified from any liability for any of their actions or omissions made in reliance on the Grantor's actions or instructions under this article. I 3.2 Suspension of Rights. The Grantor's personal rights under this article will be suspended immediately if the. Grantor becomes disabled. For these purposes, the Grantor's disability is determined as follows: ., \ (a) Court Decision. If the Grantor is determined to be incapacitated by a court having jurisdiction, the Grantor's personal rights reserved in this article will be suspended until his legal capacity is restored. (b) Private Decision. In the absence of a judicial determination, if a majority of the Grantor's children and the next successor Trustees reasonably believe that the Grantor is suffering from any mental or physical incapacity that would affect the Grantor's judgment concerning management of the Trust, and if they obtain written confirmation of that opinion from the Grantor's physician, they may give the Grantor written notice to that effect. Upon delivery to the Grantor of that written notice, the Grantor's personal rights reserved in this article will be suspended immediately and the named successor Trustees will serve until the Grantor's legal capacity is determined by a court or until the persons entitled to give such written notice rescind it. (c) Other Facts. The Grantor's personal powers will be suspended if the persons described in Section Article 3.2(b) give written notice to the Trustees (or the successor Trustees, if applicable) that they have received credible and timely evidence that the Grantor has disappeared, is unaccountably absent, or is being detained under duress so that he is unable to look after his financial interests. 3.3 Homestead Rights. Despite any other provision of this Trust, the Grantor reserves the right to reside on any real property owned by the Trust during the Grantor's lifetime. The Grantor will be entitled to claim any available homestead tax exemption for any real property in the Trust, and, for purposes of that exemption, his interest in such property will be deemed an interest in real property and not an interest in personal property. This provision does not restrict the Trustees from selling, leasing, or encumbering that property without the Grantor's joinder in any deed or other instrument. ARTICLE 4 PAYMENTS DURING THE GRANTOR'S LIFETIME The Trustees shall make the following payments during the Grantor's lifetime: 2 , 4.1 For the Grantor's Benefit. The Trustees shall pay to or apply for the Grantor's benefit (without obligation to any guardian who may be appointed for the Grantor) whatever income or principal that the Trustees in their discretion deem necessary or advisable for the Grantor's best interests. 4.2 Intent. The Trustees are authorized to provide for the finest available support and health care for the Grantor, even if this leaves no assets of the TDlst remaining for other beneficiaries. ,/ , 4.3 Gifts. If the Grant~r's personal rights are suspended as provided in Article J., the Grantor authorizes the TruStees to~make gifts from the Trust Estate during the Grantor's lifetime for estate planning purposes, or to distribute amounts to the Grantor's legally appointed guardian or to his attorney-in-fact for those purposes, subject to the following rules:' (a) Recipients. The gifts may be made only to the Grantor's descendants or to, trusts primarily for their benefit, in amounts not exceeding the exclusions allowed under Section 2503 of the Internal Revenue Code. (b) Trustee Limited. When a person eligible to receive gifts is serving as Trustee, the combined total of all gifts to that person during the calendar year cannot exceed Five Thousand Dollars ($5,000), or five percent (5%) of the aggregate value of the Trust Estate, whichever is greater. This limit applies to the entire year even if that person only serves as Trustee for part of that year, but does not apply to gifts made to that person before he or she began serving as Trustee. (c) Gifts Among Classes. Gifts to or for the benefit of the Grantor's descendants must be made equally among classes. A class. will consist of a child of the Grantor and the descendants of that child. If a gift is made to any member in one class of beneficiaries, a concurrent and equal gift must be made to each other class of beneficiaries. Gifts within a class can be made in different amounts to the members of that class (and even exclude one or more members in that class). (d) Charitable Pledges. The Trustees may pay any charitable pledges the Grantor made while his personal rights were not suspended (even if not yet due). ARTICLE 5 DISTRIBUTIONS AFTER THE GRANTOR'S DEATH Upon the Grantor's death and after making provision for the payments under Article II, the Trustees shall distribute the remaining Trust Estate as follows: 5.1 Gifts Under Will. If the Grantor's Will makes a gift ofa specific asset that is held in this Trust when the Grantor dies, and if this Trust does not make a specific gift of that asset, the Trustees shall distribute that asset to the beneficiary named in the Grantor's Will. If the Grantor's Will gives his residuary probate estate to this Trust, and ifhis probate 3 estate is insufficient to satisfy any other preresiduary gift under the Grantor's Will, the Trustees shall satisfy the balance of that gift from the Trust. 5.2 Residuary Trust Estate. The Trustees shall distribute all the remaining Trust Estate to the Grantor's descendants, per stirpes, subject to Article 6. If the Grantor leaves no descendants, the Trustees shall distribute the remaining Trust Estate to the t Grantor's heirs at law, determined at that time as ifhe had died unmarried and intestate under Florida law then in effect, subject to Article 6. J .1 . ARTICLE 6 ST AND.BY TRUST If any assets are distributable under this. Trust (other. than' by exercise of ,a power of appointment) to a persOD who has not then reached age 23, or who in the judgment of the Trustees is under a disability, the Trustees will hold that person's share in trust for his or her benefit. In determining a person's disability, the Trustees may rely conclusively upon the opi~on of a medical doctor retained by them to make such a determination. The Trustees may apply so much of the income and principal of this separate trust that they consider necessary or desirable for the person's health, education, support, and maintenance. When the person reaches age 23 or when that person's disability, in the judgment of the Trustees, ceases to exist, the Trustees shall distribute the remaining assets of this separate trust to that person. If that person dies before complete distribution of this separate trust, the remaining trust assets are to be distributed, subject to this article: (a) to that person's then living descendants, per stirpes; or if none, (b) to the then living descendants, per stirpes, of that person's closest ancestor in degree who is also a descendant of the Grantor; or if none, (c) to the Grantor's then living descendants, per stirpes; or if none, (d) to the Grantor's heirs at law, determined under Florida law then in effect as if the Grantor had died intestate and unmarried on that date as a resident of Florida. This article is to be effective only and is limited in duration to the extent that it does not result in any violation of any applicable rule against perpetuities or similar law. ARTICLE 7 PROVISIONS GOVERNING TRUSTEES The following provisions apply to all Trustees appointed under this Trust, including the Grantor while he serves as Trustee: 7.1 Successor Trustee. After the Grantor's death, or if the Grantor's personal rights under this Trust are suspended, the Grantor appoints EDWARD T. BRODERICK to serve as successor Trustee. If EDWARD T. BRODERICK fails or ceases to serve as Trustee, Grantor's daughter; SHEILA O'DONNELL BRODERICK, shall serve as alternate 4 successor trustee. If she fails or ceases to serve, grantor's daughter, KATHLEEN A. O'DONNELL shall serve as alternate successor trustee. If she fails or ceases to serve, grantor's daughter, NANCY O'DONNELL KIELY shall serve as alternate successor trustee. 7.2 Incapacity of Trustee. If the Grantor's personal rights are suspended as provided in Article 3. he will cease to serve as Trustee while those rights are suspended. If any other Trustee becomes disabled (as defined. in this Trust), he or~he will immediately cease to act as Trustee. If a Trustee who ceases to serve because of a disability thereafter recovers from that disability, he or she will automaiically.become-a Trustee again, and the last successor Trustee who underto<;>k to serve will automatically cease to be a Trustee until" another successor Trustee is requited. "~ 7.3 Resignation. Any Trustee. may resign by giving 30 days'written notice delivered personally or by mail to any then serving co-trustee and to the Grantor if he is then living and not disabled; otherwise to the next named successor Trustee, or if none, to the persons having power to appoint successor Trustees. 7.4 Removal of Trustees. The Grantor reserves the right to remove any Trustee by giving written notice to that Trustee. If the Grantor's personal rights are suspended as provided in Article 3, the right to remove Trustees may be exercised as follows: (a) Who May Remove. A majority of the Grantor's children who are living and not disabled may exercise the right to remove a Trustee as provided in this paragraph. (b) Removal for Cause. All Trustees may be removed by the persons listed in Section Article 7.4(a) for cause for any of the following reasons: · The willful or negligent mismanagement of the trust assets by that individual Trustee; · The abuse or abandonment of, or inattention to, the trust by that individual Trustee; · A federal or state charge against that individual Trustee involving the commission of a felony or serious misdemeanor; · An act of theft, dishonesty, fraud, embezzlement, or moral turpitude by that individual Trustee; or · The use of narcotics or excessive use of alcohol by that individual Trustee. The removal of an individual Trustee under this paragraph will be effective immediately upon delivery to him or her of the written agreement for removal signed by all of the persons whose consent is required. 5 (c) Acceptance Required. If there are no successor Trustees named in this Trust who are eligible and willing to serve, a removal notice must name a successor Trustee, and a qualified successor Trustee must accept appointment within the period of the removal notice. (d) Exceptions. Despite the foregoing, no person prpposed to be removed as Trustee may participate in exercising this removal power. Any such person will not be counted in determining the required votes for removal. . J. . 7.S Powers of Successor Trustees. Successor Trustees will have all powers granted to the original Trustees. . . 7.6 Accountings. Accountings'must be g~ven 'to the beneficiaries at least annually (quarterly if a Corporate Trustee is serving). The accountings must show the assets held in trust and all receipts and disbursements. A beneficiary's written approval of an accounting will be final and binding upon that beneficiary and all persons represented by him or her as to all matters disclosed in that accounting. In any event, if a beneficiary fails to object to an accounting within six months ofreceiving it, his or her approval is conclusively presumed. A successor Trustee may require the prior Trustee to render a full and final accounting. 7.7 Acts by Other Fiduciaries. The Trustees are not required to question any acts or failures to act of the fiduciary of any other trust or estate, and will not be liable for any prior fiduciary's acts or failures to act. The Trustees can require a beneficiary who requests an examination of another fiduciary's actions or omissions to advance all costs and fees incurred in the examination, and if the beneficiary does not, the Trustees may elect not to proceed or may proceed and offset those costs and fees directly against any payment that would otherwise be made to that beneficiary. 7.8 Court Supervision. The Grantor waives compliance by the Trustees with any law requiring bond, registration, qualification, or accounting to any court. 7.9 Compensation. Each Trustee is entitled to be paid reasonable compensation for services rendered in the administration of the Trust. Reasonable compensation for a Corporate Trustee will be its published fee schedule in effect when its services are rendered unless otherwise agreed in writing, and except as follows. Any fees paid to a Corporate Trustee for making principal distributions, for termination of the trust, and upon termination of its services must be based solely on the value of its services rendered, not on the value of the trust principal. During the Grantor's lifetime the Trustees' fees are to be charged wholly against income (to the extent sufficient), unless directed otherwise by the Grantor in writing. 7.10 Indemnity. Any Trustee who ceases to serve for any reason will be entitled to receive (and the continuing Trustees shall make suitable arrangements to provide) reasonable indemnification and security to protect and hold that Trustee harmless from any damage or liability of any nature that may be imposed upon it because of its actions or omissions while serving as Trustee. This protection, however, does not extend to a Trustee's 6 I--~ negligent actions or omissipns that clearly and demonstrably result in damage or liability. A prior Trustee may enforce these provisions against the current Trustees or against any assets held in the Trust, or if the prior Trustee is an individual, against any beneficiary to the extent of distributions received by that beneficiary. This indemnification right will extend to the estate, personal representatives, legal successors, and assigns of a Trustee. .. 7.11 Multiple Trustees. If two Trustees are serving at any time, any power or discretion of the Trustees may be exercised only by their joint agreement. Either Trustee I, . . may delegate to the other Trustee the authority to -8.ctoo behalf"of both Trustees and to exercise any power held by the Tru$tees. If more than two Trustees are serving at any time, and unless unanimous agreement" is specifically required by the terms of this Trust, any power or discretion of the Trustees may be exercised only by a majority. The Trustees may III I I l delegate to anyone or more of themselves the authority ~o act on behalf of all the Trustees and to exercise any power held by the Trustees. Trustees who consent to the delegation of authority to other Trustees will be liable for the consequences of the actions of those other Trustees as if the consenting Trustees had joined the other Trustees in performing those actions. A di~senting Trustee who did not' consent to the delegation of authority to another Trustee and who has not joined in the exercise of a power or discretion cannot be held liable for the consequences of the exercise. A dissenting Trustee who joins only at the direction of the majority will not be liable for the consequences' of the exercise if the dissent is expressed in writing delive~.<:lto any of the other Trustees before the exercise of that power or discretion. ARTICLE 8 SURVIVAL PROVISIONS If any beneficiary is required to survive the Grantor or another person to receive a distribution, and if the beneficiary does not survive the Grantor or that other person by 90 days, or if that beneficiary cannot be located within one year after the Grantor's death despite reasonable attempts by the Trustees to locate that beneficiary, the beneficiary will be treated as if he or she died before the Grantor or that other person. ARTICLE 9 PROTECTION OF INTERESTS The interest of any beneficiary under this Trust, in either income or principal, may not be anticipated, alienated, or in any other manner assigned by the beneficiary except to or among persons who are descendants of that beneficiary's parents, and will not be subject to any legal process, bankruptcy proceedings, or the interference or control of the beneficiary's creditors or others. ARTICLE 10 GENERATION-SKIPPING TAX PROVISIONS rfGST exemption is to be allocated to any separate trust and the allocation would cause that trust to have an inclusion ratio greater than zero, then before the allocation is made, the Trustees are authorized to divide the trust into two separate trusts representing fractional 7 shares of the assets being divided, so that the GST exemption can be allocated to give one such separate trust an inclusion ratio of zero (an "exempt trust") and the other separate trust an inclusion ratio of one (a "nonexempt trust"). Except as may otherwise be specifically provided in this Trust, the separate trusts will be governed by the same provisions that would apply if the trust had not been divided. 10.1 Protection of Exempt Status. No assets are to be added to a trust that would change the inclusion ratio of that trust to a number greater than zero. Instead, the Trustees shall hold those assets as a separate trust under th~l terms and conditions specified in this Trust, but with a separate inclusion !atio. If a trust has already beeri divided into exempt and nonexempt trusts, and assets are added tq the trust that are either wholly exempt or wholly nonexempt, the assets to be received' are to be added to the separate trust of the same character, or if none, held as a separate trust .retaining their exempt or nonexempt status. 10.2 Operation of Separate Trusts. If a trust is divided into separate trusts, the Trustees may make different decisions with respect to the separate trusts concerning tax elec~ions, the exercise, of the Trustees', discretionary powers and authority (including decisions whether to make discretionary distributions), investment decisions, and any other actions consistent with treatment as separate trusts, except that, as between an exempt trust and a nonexempt trust, the Trustees shall pay all taxes, expenses, and other charges allocable to those trusts first from the nonexempt trust and, only after that trust is exhausted, from the exempt trust. 10.3 Adequate Interest. IfGST exemption is allocated to a residuary gift and a pecuniary gift is not entitled to income or interest under state law, the Trustees must allocate to that pecuniary gift a pro rata share of the income of the Trust Estate between the Grantor's date of death and the date of payment, unless that pecuniary gift is paid in full (or irrevocably segregated and held in a separate account pending distribution) within 15 months after the Grantor's death. ARTICLE 11 PAYMENTS OF OBLIGATIONS, EXPENSES, AND TAXES The Trustees shall pay all of the Grantor's obligations, expenses, and taxes as follows: 11.1 Obligations. The Grantor directs that his legally enforceable obligations (except those secured by mortgages or other security instruments) be paid in the order and manner prescribed by law. 11.2 Expenses. The term "expenses" includes all estate transmission or management expenses of the Grantor's probate estate, all administrative expenses of this Trust, and all costs of the Grantor's last illness and funeral. The Grantor directs that all expenses be paid from the Residuary Trust Estate, except that no expenses are to be charged to any interest if that would diminish the aggregate estate tax deductions available. Payments may be made from and charged to either income or principal, at the discretion of the Trustees. The Trustees shall not seek reimbursement from any party for expenses that they pay. 8 --- I 11.3 Taxes. The term "estate taxes" means all state and federal estate, inheritance, or transfer taxes payable by reason of the Grantor's death (including the generation-skipping transfer tax on any direct skip created by the express terms of this Trust rather than by disclaimer), plus any related interest and penalties attributable to these taxes, but excluding any other generation-skipping taxes. (a) Source of Taxes. The Grantor directs that ~l 'of his estate taxes be paid from the Residuary Trust Estate, without apportionment. Despite the foregoing, no estate taxes are to be paid from any interest If that would diminish the aggregate estate tax deductions available. ! ;-' (b) Reimbursement. The Grantor waives all rights of recovery under Sections 2206, 2207, and 2207B of the Internal Revenue Code. The Grantor directs the Trustees to exercise all rights of recovery of estate taXes granted by Section 2207 A of the Internal Revenue Code as in effect at the Grantor's death, to the extent that the Trustees determine that exercising those rights is economically justifiable. (c) Interest on Tax. All taxes apportioned under this article also are to include interest from 30 days after the Grantor's Personal Representatives or the Trustees make a written demand for payment upon the recipient of the property against which tax has been apportioned until the tax is paid, provided that the federal estate tax return has already been filed. This interest is to be calculated at the same rate and in the same manner as for the underpayment of taxes under Section 6621 of the Internal Revenue Code. For the purposes of such demand and the payment by the recipient, the amount of the estate taxes shown on the federal and state estate tax return initially will be deemed to be correct, subject to appropriate adjustment when the estate taxes are finally determined and paid. If the amount so apportioned (together with any interest) is not paid within three months of the final determination of tax, it will become an offset against any amount otherwise due to the beneficiary under this Trust. To the extent that the amount so apportioned (together with the interest) is fully offset by the amounts due the beneficiary, interest is to cease at the end of the three month period. Alternatively, the beneficiary may notify the Grantor's Personal Representatives or the Trustees of his or her desire to offset a portion (or all) of that beneficiary's interest under this Trust to pay those taxes. In that event, interest will not be charged against that beneficiary for the amount offset. (d) Method of Payment. The Trustees may rely on a written statement signed by the Grantor's Personal Representatives as to the amount of those expenses and taxes. The Trustees may make payment directly or to the Grantor's Personal Representatives, as the Grantor's Personal Representatives request. The Trustees will be held harmless from any liability in making payments as so directed. (e) Excluded Property. lfany funds become available to the trustees of any trust, including without limit, life insurance, qualified employee benefit plans, individual retirement accounts, or other property from sources specified in Section 2039 of the Internal Revenue Code, and those funds are not otherwise included in the Grantor's gross estate for 9 , . federal estate tax purposes, then none of those funds may be used to pay, directly or indirectly, any debts, taxes, or expenses of the Grantor or his estate. ARTICLE 12 FIDUCIARY POWERS The Grantor grants to the Trustees full power to .deal freely with any property in the Trust. The Trustees may exercise these powers independently and without the approval of any court. No person dealing with the Trustees rieed inquire into the-propriety of any of their actions or into the application of any funds or assets. The Trustees' shall, however, exercise all powers in a fiduciary capacity for the qest interest of the beneficiaries of any trust created in this Trust. The Trustee may have duties and responsibilities in addition to those described in this Trust, and should obtain legal advice concerning its fiduciary duties. Without limiting the generality of the foregoing, the Trustees are given the'following discretionary powers in addition to any other powers conferred by law: 12.1 Type of Assets. Except as ,otherwise provided to the contrary, to hold funds uninvested for such periods as the Trustees deem prudent, and to invest in any assets the Trustees deem advisable even though they are not technically recognized or specifically listed in so-called "legal lists," without responsibility for depreciation or loss on account of those investments, or because those investments are non-productive, as long as the Trustees act in good faith. 12.2 Original Assets. Except as otherwise provided to the contrary, to retain the original assets they receive for as long as they deem best, and to dispose of those assets when they deem advisable, including any interests in CDL LIMITED, A NEW YORK CORPORA nON or other affiliated or successor entities, as more specifically set out in Article 14. even though such assets, because of their character or lack of diversification, would otherwise be considered improper investments for the Trustees. 12.3 Tangible Personal Property. To receive and hold tangible personal property; to payor refrain from paying storage and insurance charges for such property; and to permit any beneficiaries to use such property without either the Trustees or beneficiaries incurring any liability for wear, tear, and obsolescence of the property. 12.4 Specific Securities. To invest in assets, securities, or interests in securities of any nature, including (without limit) commodities, options, futures, precious metals, currencies, and in domestic and foreign markets and in mutual or investment funds, including funds for which the Trustees or any affiliate performs services for additional fees, whether as custodian, transfer agent, investment advisor or otherwise, or in securities distributed, underwritten, or issued by the Trustees or by syndicates of which they are a member; to trade on credit or margin accounts (whether secured or unsecured); and to pledge assets of the Trust Estate for that purpose. 12.5 Property Transactions. To buy, sell, pledge, exchange, or lease any real or personal property, publicly or privately, for cash or credit, without court approval and upon 10 the terms and conditions that the Trustees deem advisable; to execute deeds, leases, contracts, bills of sale, notes, mortgages, security instruments, and other written instruments; to abandon or dispose of any real or personal property in the Trust which has little or no monetary or useful value, after notifying the beneficiaries or their legal representatives; to improve, repair, insure, subdivide and vacate any property; to erect, alter or demolish buildings; to adjust boundaries; and to impose easements, restrictions, 1IDd covenants as the Trustees see fit. A lease will be valid and binding for its full term even if it extends beyond the full duration of the Trust. .) ,/ , 12.6 Borrow Money. To borrow money from any source (including the Trustees in their nonfiduciary capacity), to guaran~e-indebtedness, and to secure the loan or guaranty by mortgage or other security interest. ., \ 12.7 Maintain Assets. To expend whatever' funds they deem proper for the preservation, maintenance, or improvement of assets. The Trustees in their discretion may elect any options or settlements or exercise any rights under all insurance policies that they hold, However, no fiduciary who is the insured of any insurance policy held in the Trust may exercise any rights or have any incidents of ownership with respect to the policy, including the power to change the beneficiary, to surrender or cancel the policy, to assign the policy, to revoke any assignment, to pledge the policy for a loan, or to obtain from the insurer a loan against the surrender value of the policy. All such power is to be exercised solely by the remaining Trustees, if any, or if none, by a special fiduciary appointed for that purpose by a court having jurisdiction. 12.8 Advisors. To employ and compensate attorneys, accountants, advisors, financial consultants, managers, agents, and assistants (including any individual or entity who provides investment advisory or management services, or who furnishes professional assistance in making investments for the Trust)without liability for any act of those persons, if they are selected and retained with reasonable care. Fees may be paid from the Trust Estate even if the services were rendered in connection with ancillary proceedings. The Trustees may serve in any of these capacities and be compensated separately for their services in each. 12.9 Indirect Distributions. To make distributions, whether of principal or income, to any person under age 23 or to any incapacitated person according to the terms of this Trust by making distributions directly to that person whether or not that person has a guardian; to the parent, guardian, or spouse of that person; to a custodial account established by the Trustees or others for that person under an applicable Uniform Gift to Minors Act or Uniform Transfers to Minors Act; to any adult who resides in the same household with that person or who is otherwise responsible for the care and well-being of that person; or by applying any distribution for the benefit of that person in any manner the Trustees deem proper. The receipt ofthe person to whom payment is made will constitute full discharge of the Trustees with respect to that payment. 12.10 Non-Pro Rata Distribution. To make any division or distribution in money or in kind, or both, without allocating the same kind of property to all shares or distributees, 11 _m~1 and without regard to the income tax basis of the property. Any division will be binding and conclusive on all parties. 12.11 Nominee. Except as prohibited by law, to hold any assets in the name of a nominee without disclosing the fiduciary relationship; to hold the property unregistered, without affecting its liability; and to hold securities endorsed in blank,,.in street certificates, at a depository trust company, or in a book entry system; 12;12 Custodian. To employ a custodian, or" agent ("the Custodian") located anywhere within the United States"at the discretion of the Trustees but at the expense of the Trust, whether or not such Custodian is an ,affiliate of the Trustees or any person rendering services to the Trust; to register securities in the name of the Custodian or a nominee thereof without designation offiduciary capacity; and"tb appointthe CUstodian to perform such other ministerial functions as the Trustees may direct. While such securities are in the custody of the Custodian, the Trustees will be under no obligation to inspect or verify such securities nor will the Trustees be responsible for any loss by the Custodian. 12.13 Settle Claims. To contest, compromise, arbitrate, or otherwise adjust claims in favor of or against the Trust, to agree to any rescission or modification of any contract or agreement, and to refrain from instituting any suit or action unless indemnified for reasonable costs and expenses. 12.14 Corporate Rights. To vote arid exercise any option, right, or privilege to purchase or to convert bonds, notes, stock (including shares or fractional shares of stock of any Corporate Trustee), securities, or other property; to borrow money for the purpose of exercising any such option, right, or privilege; to delegate those rights to an agent; to enter into voting trusts and other agreements or subscriptions; to participate in any type of liquidation or reorganization of any enterprise; and to write and sell covered call options, puts, calls, straddles, or other methods of buying or selling securities, as well as all related transactions. 12.15 Partnership Interests. To hold interests in sole proprietorships, general or limited partnerships, joint ventures, business trusts, land trusts, limited liability companies, and other domestic and foreign forms of organizations; and to exercise all rights in connection with such interests as the Trustees deem appropriate, including any powers applicable to a non-admitted transferee of any such interest. 12.16 Self-Dealing. To exercise all their powers even though they may also be acting individually or on behalf of any other person or entity interested in the same matters. The Trustees, however, shall exercise these powers at all times in a fiduciary capacity, primarily in the interest of the beneficiaries of the Trust. Despite any other provision of this Trust, no Trustee ~ (other than the Grantor) may participate in the decision to make a discretionary distribution that would discharge a legal support obligation of that Trustee. All power to make such distributions will be exercised solely by the remaining Trustees, if any, or if there are no other Trustees then'Serving, by the person or persons named to serve as the 12 next successor Trustee, or ifthere are none, by a special Trustee appointed for that purpose by a court having jurisdiction. 12.17 Elections. If no Personal Representative is serving for the Grantor's estate, and to the extent permitted by law, to perform in a fiduciary capacity any act and make any and all decisions or elections under state law or the Internal Revenue Code on behalf of the Grantor or his estate, including but not limited to, claiming the whole or any part of the expenses of administration as income tax deductions for the Grantor's estate or this Trust, electing the marital deduction in whole or'in part,. making allocations of the Grantor's exemption from the federal gener~tion-skipping transfer tax, adopting alternate values for estate tax purposes, and selecting'taxable )lears and dates of distribution. The Trustees are specifically excused from making equitable adjustments among beneficiaries because of any election. . ., \ , 12.18 Qualified Property. To manage any qualified real property or qualified family-owned business interests so as to avoid imposition of the additional estate tax under Sections 2032A or 2057 of the Internal Revenue Code, and to furnish security for the payment of any additional estate taxes imposed under those sections. 12.19 Expenses. To determine, in a fiduciary capacity, how expenses of administration and receipts are to be apportioned between principal and income. 12.20 Terminate Small Trusts. After the Grantor's death, to exercise their discretion to refrain from funding or to terminate any trust whenever the value of the principal of that trust would be or is less than One Hundred Thousand Dollars ($100,000), and to distribute the remaining principal and all accumulated income of the trust as provided in Section 12.9 to the beneficiaries then entitled to receive income in proportion to their shares of that income (or on a per capita basis if their shares are not fixed). The Trustees shall exercise this power to terminate in their discretion as they deem prudent for the best interest of the permissible income beneficiaries at that time. 12.21 Allocations to Interest and Principal. To treat premiums and discounts on bonds and other obligations for the payment of money in accordance with either generally accepted accounting principles or tax accounting principles and, except as otherwise provided to the contrary, to hold nonproductive assets without allocating any principal to income, despite any laws or rules to the contrary. The Trustees in their discretion may exercise the power described in Section 738.104 of the Florida Statutes to adjust between principal and income, as appropriate, and, in addition, may convert any income interest into a unitrust interest, or a unitrust interest to an income interest, as they see fit, all as provided in Section 738.1041 of the Florida Statutes, despite any provision of those sections to the contrary. 12.22 Use ofIncome. Except as otherwise provided in this Trust, and in addition to all other available sources, to exercise their discretion in the use of income from the assets of the Trust to satisfy the liabilities described in this Trust, without accountability to any beneficiary . 13 -----.-T 12.23 Sever Trusts. To sever any trust on a fractional basis into two or more separate trusts, and to segregate by allocation to a separate account or trust a specific amount from, a portion of, or a specific asset included in any trust. The Trustees may consolidate two or more trusts (including trusts created by different transferors) having identical beneficial terms and conditions into a single trust. A trust created by severance or consolidation will be treated as a separate trust for allpuq>oses from $e date on which the severance or consolidation is effective, and will' be held on the .same beneficial terms and conditions as those before the severance or consolidation. Income earned on a consolidated I . or severed amount, portion, or specific asset after the/consolidation. or severance is effective will pass with that amount, portion, or specific asset. I ;-/ 12.24 Consolidated Funds.. Unless inconsistent with other provisions of this Trust, to hold two or more trusts or other funds in bile or more. consolidated funds,. in which the separate trusts or funds have undivided interests, except that an accounting must be rendered to each trust showing its undivided interests in those funds. 12.25 Valuations. In making distributions or allocations under the terms of this Trust to be valued as of a particular date, the Trustees may use asset valuations obtained for a date reasonably close to that particular date (such as a quarterly closing date before or after that date) if, in the Trustees' judgment, obtaining appraisals or other determinations of value on that date would result in unnecessary expense, and if in the Trustees' judgment, the fair market value as determined is substantially the same as on that actual date. This paragraph will not apply if valuation on a specific date is required to preserve a qualification for a tax benefit, including any deduction, credit, or most favorable allocation of an exemption. 12.26 Incorporation. To incorporate any business or venture, and to continue any unincorporated business that the Trustees determine to be not advisable to incorporate. 12.27 Delegation. To delegate periodically among themselves the authority to perform any act of administration of any trust. 12.28 Advances. To make cash advances or loans to beneficiaries, with or without security. 12.29 Investment Manager. To employ any investment management service, financial institution, or similar organization to advise the Trustees and to handle all investments of the Trust and to render all accountings of funds held on its behalf under custodial, agency, or other agreements. If the Trustees are individuals, these costs may be paid as an expense of administration in addition to fees and commissions. 12.30 Depreciation. To deduct from all receipts attributable to depreciable property a reasonable allowance for depreciation, computed in accordance with generally accepted accounting principles consistently applied. 12.31 Disclaim Assets or Powers. To disclaim any assets otherwise passing or any fiduciary powers pertaining to any trust created hereunder, by execution of an instrument of 14 I~ . I disclaimer meeting the requirements of applicable law generally imposed upon mdividuals executing disclaimers. No notice to or consent of any beneficiary, other interested person, or any court is required for any such disclaimer, and the Trustees are to be held harmless for any decision to make or not make such a disclaimer. 12.32 Transfer ,Situs. To transfer the situs of any trust or any, trust property to any other jurisdiction as often as the Trustees deem advisable, and if necessary to appoint a substitute or ancillary Trustee to act with respect to that property. The Trustees may delegate to the substitute Trustee any or all of the powers given to the Trustees; may elect to act as advisor to the substitute Trustee an4 receive reasonable compensation for that service; and may remove any acting or substitute TI'U&tee and appoint another, or reappoint themselves, at will. . I 1 12.33 Related Parties. To enter into any transaction on behalf of the Trust despite the fact that another party to that transaction may be: (i) a business or trust controlled by the Trustees, or of which the Trustees, or any director, officer, or employee of the Corporate Trus,tees, is also a director, officer, or employee; (ii) an affiliate or business associate of any beneficiary or the Trustees; or (iii) a beneficiary or Trustee under this Trust acting individually, or any relative of such a party. 12.34 Additional Powers for Income-Producing Real Estate. In addition to the other powers set forth above or otherwise conferred by law, the Trustees have the following powers with respect to any income-producing real property which is or may become a part of the Trust Estate: · To retain and operate the property for as long as they deem advisable; · To control, direct, and manage the property, determining the manner and extent of their active participation in these operations, and to delegate all or any part of their supervisory power to other persons that they select; · To hire and discharge employees, fix their compensation, and define their duties; · To invest funds in other land holdings and to use those funds for all improvements, operations, or other similar purposes; · Except as otherwise provided with respect to mandatory income distributions, to retain any amount of the net earnings for working capital and other purposes that they deem advisable in conformity with sound and efficient management; and · To purchase and sell machinery, equipment, and supplies of all kinds as needed for the operation and maintenance of the land holdings. 15 ARTICLE 13 ENVIRONMENTAL PROVISIONS The following rules govern administration of the Trust with respect to assets that could cause the Trustees to incur liability for environmental contamination or hazardous wastes. 13.1 Vesting of Title. Title to the following types of assets will not vest in any Trustee (including a successor Trustee when it begins to serve) until the Trustees execute a written instrument accepting title to those assets: · Real property or any interest of any nature in real property (including mortgages secured by.real property), and lil'l I , · Any interest in a partnership, limited liability company, or Closely held corporation which owns real property or an interest in real property and in which the Trustees would have the ability to vote or otherwise participate in the management and control of the entity's operations. I If the Trustees refuse to accept title to an asset that has never been part of this Trust, title to that asset will revert to the transferor or pass to such other persons (other than the Trustees) as may be provided by applicable law. If a successor Trustee refuses to accept title to such an asset accepted by the prior Trustees, the prior Trustees (or their Personal Representatives) will continue to hold title to and administer that asset until it is distributed, sold, or otherwise disposed of, or until other relief is granted by a court having jurisdiction over the Trust. Until they accept title to such an asset, the Trustees will have no fiduciary duty with respect to that asset. 13.2 Audits. The Trustees may require environmental audits acceptable to them to be made at any time at the expense of the Trust. 13.3 Liability. The Trustees will not be liable to any beneficiary for any claims against or losses incurred by the Trust because of compliance with laws regulating environmental contamination or hazardous wastes, including reporting or abating contamination, cleaning up property, incurring expenses in connection with administrative or judicial proceedings, and establishing reserves for such payments, even if amounts expended exceed the value of the property. The Trustees may require indemnities or other arrangements satisfactory to them that will protect and hold them harmless from liability that might be incurred for environmental contamination or hazardous substances. 13.4 Other Laws. These provisions are in addition to other remedial powers and rights given to fiduciaries under applicable law. ARTICLE 14 SPECIAL BUSINESS PROVISIONS The following provisions apply to any closely-held stock or other business interests held in this Trust. 16 1 " 14.1 Subchapter S Stock. Despite any other provisions of this Trust, if a trust created in this instrument is to become the owner of, or already owns, stock in a corporation that has an election in effect (or one that proposes to make an election) under Section 1362 of the Internal Revenue Code (an itS Corporationlt), and that trust would not otherwise be permitted to be an S Corporation shareholder, the following provisions will apply: (a) Electing Small Business Trust. The Trustee~ in their discretion may elect for the trust to become an Electing Small Business Trust ("ESBTIt) as defined in the Internal Revenue Code. J. (b) Qualified Subch~pt.er S Trust. If the Trustees do not cause the trust to become an ESBT, the Trustees shall set aside the S Corporation stock in a separate trust for the current income beneficiary of such .trost, so that a Qualified Subch~pter S Trust (ItQSSTIt) election under Section 1361 of the Internal Revenue Code can be filed with respect to that trust. If a trust has more than one permissible current income beneficiary, the Trustees shall divide that S Corporation stock into shares so that there is a share fGr each of the GraJ;ltor's then living descendants, per stirpes. The Trustees shall hold each share as a separate QSST for the persons described above, and each such person will be the sole beneficiary of his or her QSST. To the greatest extent possible, the Trustees shall administer each QSST under the terms of the trust from which it was derived, but subject to the following overriding provisions: (1) Consent. The Trustees shall notify the beneficiary of each separate trust promptly that a QSST election must be filed with the Internal Revenue Service. Thereafter, each beneficiary shall file a timely and proper QSST election with the Internal Revenue Service. If a beneficiary fails or refuses to make the QSST election, the Trustees shall make an ESBT election for that trust. If the beneficiary does make the QSST election, then his or her separate trust will be administered as set forth below. (2) Income Payments. During the beneficiary's life, the Trustees shall pay all net income of the trust to the beneficiary (and only to that beneficiary) in quarterly or more frequent installments. The beneficiary's income interest in the trust will terminate on the earlier of his or her death or the termination of the trust under its terms. (3) Principal Invasions. If the beneficiary is otherwise entitled to receive principal distributions, the Trustees may distribute principal from that separate trust during the beneficiary's life only to or for the benefit of that beneficiary (and no one else). (4) Final Distribution. If the QSST is terminated during the beneficiary's life, the Trustees shall distribute all remaining 17 , " assets of that separate trust to that beneficiary. If the beneficiary dies before that trust's termination, all remaining assets of the QSST are to be distributed as provided in the original trust, but subject to this Section 14.1. (5) Termination of QSST Status. If a separate trust would cease to qualify as an S Corporation s~areholder, the Trustees in their discretion may: (i) make an ESBT election for that separate trust; (ii) distribute allS Corporation stock to the beneficiary; or if the beneficiary is deceased, (Hi) distribute all S Corpor&tion stock to one or more of the Grantor's descendants, without need to equalize distributions, provided that distributiotlS Will not be made to such a large number of persons as to disqualify the corporation as an S Corporation. The Trustees in their discretion also may convert a QSST to an ESBT, whether or not the beneficiary has consented to QSST treatment and, if the beneficiary consents, may convert an ESBT into a QSST. 14.2 Management and Sale of Business Interests. The Grantor anticipates that a great percentage of the Trust Estate will consist of an interest in various closely held corporations and partnerships (all collectively referred to as the "Business Entities," whether one or more). If the disposition of these Business Entities has not otherwise been provided for at the Grantor's death, then, in addition to any other authority granted by this Trust, the following will apply: (a) Operation and Sale. The Trustees shall use their discretion in participating in the operation of the Business Entities and in selling the interest in the Business Entities. The Trustees are specifically authorized to sell an interest in the Business Entities to any partner, officer, or employee of the business, to any individual Trustee, or to any beneficiary of this Trust. (b) Partnerships. In addition to the powers described above, the Trustees are directed to determine whether the effecting of any measures with respect to any partnership interests would be of benefit to the beneficiaries of the Trust or of the Grantor's estate. If it is determined that one or more measures should be effected, the Trustees shall take such actions as are required to effect these measures. The measures that may be effected include, but are not limited to: · the continuation of the Trust as a partner in any of the partnerships; · the distribution of selected property by the partnerships to the Trust or its beneficiaries; · the acquisition of any additional ownership interest in the partnerships; 18 , , ' . · the liquidation of any interest in the partnerships; · the filing by the partnerships of a timely election under either Sections 754 or 732(d) of the Internal Revenue Code to adjust the basis of partnership property . (c) Supplemental Powers. In addition to the powers previously given and the powers enumerated in Article 12. the Grantor gives the Trustees the following additional powers with regard to any transactions relating to the Business Entities: (1) Employm,eI;!,t of Personnel. To hire and discharge officers and . empioyees for the Business Entities, fix their compensation,.arid define, their'duties, including the right to employ any beneficiary. (or individual Trustee) in any capacity. (~) Investment in Business. To invest other trust funds in the Business Entities; to pledge other assets of the Trust as security for loans made to the Business Entities; and to loan funds from the Trust to the Business Entities. (3) Sale or Purchase of Offerings. To participate as seller or purchaser in public or private offerings for the sale of any securities or partnership interests in the Business Entities; to enter into any related agreements containing representations, warranties, and indemnity provisions; and to incur liabilities in connection with these transactions. (4) Change of Business Form or Scope. To convert any corporation into a partnership, sole proprietorship, or limited liability company, and to diminish, enlarge, or change the scope or nature of any business. (5) Business as Separate Entity; Accountings. To treat the Business Entities as an entity separate from the Trust. In their accountings, the Trustees may report the earnings and condition of the Business Entities in accordance with standard business accounting practices. (6) Retention of Earnings. To retain in the business such net earnings for working capital and other purposes as the Trustees deem advisable. (7) Additional Fees. To receive additional compensation for their extra efforts and expertise relating to the Business Entities. Such compensation may be paid as a director's or 19 - ---T . , manager's fee or as a guaranteed payment, all of which will be remitted to the Trustees, or may be charged directly as a management consultation fee by the Trustees. (d) Standards of Risk and Trustees' Liability. The Grantor is aware that certain risks are inherent in the operation of any business and expects that the Trustees will be required to make decisions using a "reasonable business ri&k'" standard in keeping with the "prudent investor" rule. Therefore, the Grantor directs that the Trustees will not be held liable for any loss resulting from the retention and.operation of any business unless such loss results directly from their bad faith or willful misconduct. In determining liability for losses, it should be considered that the Trustees are engaging in a speculative enterprise at the Grantor's express request. . I I 14.3 Retention of Stock. The Grantor authoriZes the Trustees to retain the assets that they receive, including shares of stock or other interests in COL LIMITED, A NEW YORK CORPORATION, or its successors in interest, or any other company or entity carrying on or directly or indirectly controlling the whole or any part of its present business (collectively referred to as "COL"), for as long as the Trustees deem best, and to dispose of those assets when they deem advisable. The Grantor prefers that the Trustees not sell shares of stock or other interests in COL because the Grantor believes that the best interests of the beneficiaries will be served by retention of those interests in the Trust's portfolio. The Grantor intentionally excuses the Trustees from the duty to diversify investments by the sale or other disposition of interests in COL that ordinarily would apply under the prudent investor rule, and the Grantor directs that the Trustees not be held liable for any loss or risk (even so~called "uncompensated risk") incurred as a result of this failure to diversify. The Grantor realizes, however, that circumstances may change, and that the Trustees may determine it to be advisable to sell some or all of the interests in COL, and nothing in this paragraph will be interpreted in any manner to limit the Trustees' authority to do so. ARTICLE 15 INSURANCE PROVISIONS Any insurance policies acquired by or payable to the Trustees as an asset of this Trust are to be administered as follows: 15.1 Payment of Premiums. The Trustees may pay from the net income or principal of the Trust any premiums or assessments upon any insurance policies that they hold under the terms of this instrument. 15.2 Collection of Policy Proceeds. Upon the death of an insured, the Trustees shall process all claims for payment of death benefits payable to the Trustees. Ifpayment of . any policy is contested, however, the Trustees will not be obligated to begin legal proceedings for collection unless they are indemnified to their satisfaction for all costs, including attorney's fees. The Trustees may repay any person, including themselves, from the Trust for any advances or expenses incurred in attempting to collect death benefits on such policies. 20 1 I, I 15.3 Trustee Protection. The Trustees will have no liability or responsibility for any loss resulting from the failure of any insurance company and its inability to pay a claim under any insurance policy acquired by the Trustees. The Trustees will be under no obligation to invest any cash value accumulated in any life insurance policy owned by the Trust, regardless of the investment yield on such value within the policy as compared to the net investment yield which could be obtained outside the policy. The ,Trustees will not be liable or accountable to anyone for the exercise or nonexercise of any rights, benefits, options, or privileges under any policy held in this Trust, including the option to borrow I " against the cash values to obtain a higher investment yield outside'the policy. 15.4 Responsibilities oflnsuran~e Companies. No insurance company will be responsible for the application of any insurance proceeds by the Trustees. Payment to the Trustees of the benefits due with respect to anY1nsurance policy held as part of the Trust will completely discharge the insurance company from any further liability under that policy. ARTICLE 16 QUALIFIED,PLAN PROCEEDS If any funds from qualified employee benefit plans, individual retirement accounts, or other property from sources specified in Section 2039 of the Internal Revenue Code (collectively referred to as the "Accounts") become available to the Trustees of any trust created under this Trust, then none of those Accounts may be used to pay, directly or indirectly, any debts or expenses of the Grantor or of his estate. The Grantor intends that the Accounts be payable to trust beneficiaries who are identifiable and who are treated as "designated beneficiaries" within the meaning of the minimum distribution rules under Section 401 (a)(9) of the Internal Revenue Code and applicable regulations. Therefore, except to the extent permitted or required under applicable law, (i) the Accounts will not be liable for any share of estate taxes payable from this Trust or chargeable to the Grantor's estate, and (ii) any power of appointment over the Accounts exercisable by any person may be exercised only in favor of individuals who are younger than that person. ARTICLE 17 ADMINISTRATION AND CONSTRUCTION 17.1 Rules for Distributions. In making distributions to beneficiaries under this Trust, the Trustees must use the following criteria. (a) Other Resources. Whenever the Trustees have the authority to decide how much to distribute to or for the benefit of a beneficiary, the Trustees should make decisions taking into account any information readily available to them about the beneficiary's other available income and resources (including any obligations owed to him or her by any person that are reasonably able to be discharged). The Trustees may rely on financial statements or tax returns from the beneficiary. The Trustees can make payments directly to a beneficiary or to other persons for the beneficiary's benefit, but they do not have to make payments to a court appointed guardian. 21 I( . d . (b) Trustees' Decision. Absent clear and convincing evidence of bad faith, the Trustees' decisions as to amounts to be distributed will be final. (c) Standard of Living. Distributions to a beneficiary for health, education, support, or maintenance are to be based on his or her standard of living, determined as of the date of the distribution. . (d) Unequal Distributions. For any trusts having multiple beneficiaries, distributions may be unequal among them due to di17ferences in their resources, age, health, needs, educational inclinations, and talents. The Trustees may make unequal distributions to or for those beneficiaries without malcing equalizing adjustments among them, unless specifically provided to the contrary in this Trust. ., 1 ' Trust. 17.2 Funding Gifts. The following rules will apply to funding gifts under this (a) Pecuniary Gifts. f,\ll pecuniary gifts under this Trustthat are paid by an in-kind distribution of assets must use values as of the date of distribution. (b) Adjustments. The Trustees shall select one or more dates of allocation or distribution for purposes of satisfying gifts and funding shares or trusts. The Trustees may make allocations before the final determination offederal estate tax, with those allocations being based upon the information then available to the Trustees, and may thereafter adjust properties among the shares or trusts if it is determined that the allocation should have been made differently. 17.3 Accumulated Income. Any income not distributed to the beneficiaries pursuant to either a mandatory direction or a discretionary power is to be incorporated into principal, at such intervals as the Trustees deem convenient. 17.4 Estate Tax on Included Property. If assets orany trust created under this agreement are included in a beneficiary's estate for federal estate tax purposes, the following will apply. (a) Appointed Assets. If the beneficiary exercises a power of appointment over those assets, the Trustees are authorized to withhold from those assets the amount of estate taxes apportioned to them by applicable law, if the beneficiary does not make provisions for the payment of those taxes from other soqrces. (b) Other Assets. If the beneficiary does not have or does not exercise a power of appointment over those assets, the Trustees will pay the estate taxes attributable to those assets. The estate taxes attributable to those assets will be the amount that the beneficiary's estate taxes are increased over the amount those taxes would have been if those assets had not been included in the beneficiary's gross estate. (c) Certification and Payment. The Trustees may rely upon a written certification by the beneficiary's personal representative of the amount of the estate taxes, and 22 . '; l . may pay those taxes directly or to the personal representative of the beneficiary's estate. The Trustees will not be held liable for making payments as directed by the beneficiary's personal representative. 17.5 Transactions With Other Entities. The Trustees may buy assets from other estates or trusts, or make, loans to them, so that funds will be available to pay claims, taxes, and expenses. The Trustees can make those purchases or . loans ev~n if they serve as the fiduciary of that estate or trust, and on whatever terms and conditions the Trustees think are appropriate, except that the terms of any transaction must be commercially reasonable. 17.6 Coordination With Guard,!an. If a separate trust is created for a beneficiary who is under a legal disability, the Grantor directs the Trustees to consult with the guardian of the person for that beneficiary, or if none, -the person .having custody of the ,beneficiary, ~~ ' · establish a reasonable budget to provide for the needs of the beneficiary; · conduct 'a financial analy~is of the beneficiary's needs and determine the amounts reasonably required for his or her care; and · implement procedures for disbursing funds to the guardian for those purposes. The Trustees are authorized to make distributions that provide some incidental or indirect benefit to the beneficiary's guardian, but only if the expenditure is for the primary benefit and needs of the beneficiary. ARTICLE 18 MISCELLANEOUS PROVISIONS 18.1 Definitions. As used in this Trust, the following terms have the meanings set forth below: "". (a) Corporate Trustee. Corporate Trustee means a trustee that is a bank, trust company, or other entity authorized to serve as a trustee under the laws of the United States or any state thereof. (b) Internal Revenue Code Terms. (1) Internal Revenue Code means the federal Internal Revenue Code of 1986, as amended from time to time, or successor provisions of future federal internal revenue laws. (2) Gross estate means gross estate for federal estate tax purposes as defined in Section 2031 of the Internal Revenue Code. 23 . ..) l . (3) The terms health, education., support, and maintenance are intended to set forth an "ascertainable standard," as described in the Internal Revenue Code and its "associated Regulations. To the extent not inconsistent with the foregoing, "health" means a beneficiary's physical and mental health, including but not limited to payments for examinat~ons, surgical, dental, or other treatment, medication~counseling, hospitalization, and health insurance premiums; "education" means I ,: . . elementary, secondary,.. post-secondary. graduate, or professional schooling in an accredited institution, public or private, or attendance at other formal programs in furtherance of the beneficiary's spiritual, athletic, or artistic education, including but not limited to paym~nts for tuition, books, fees, assessments, equipment, tutoring, transportation, and reasonable living expenses. (4) Related or' subordinate with respect to Trustees has the meaning given to it under Section 672( c) of the Internal Revenue Code. (c) Other Terms. (1) Residuary Trust Estate means the Trust Estate (including assets added to the Trust by reason of the Grantor's death) left after paying all pre-residuary gifts in this Trust and all expenses and charges (other than estate taxes). (2) Distributions that are to be made to a person's descendants, per stirpes will be divided into equal shares, so that there will be one share for each living child (if any) of that person and one share for each deceased child who has then living descendants. The share of each deceased child will be further divided among his or her descendants on a per stirpes basis, by reapplying the preceding rule to that deceased child and his or her descendants as many times as necessary. (3) Disabled or under a disability means (1) being under the legal age of majority, (2) having been adjudicated to be incapacitated, or (3) being unable to manage properly personal or financial affairs because of a mental or physical impairment (whether temporary or permanent in nature). A written certificate executed by an individual's attending physician confirming that person's impairment will be sufficient evidence of disability under item (3) above, and all persons may rely conclusively on such a certificate. 24 , . I W (4) The words will and shall are used interchangeably in this Trust and mean, unless the context clearly indicates otherwise, that the Trustees must take the action indicated; as used in this Trust, the word may means that the Trustees have the discretionary authority to take the action but are not automatically required to do so. 18.2 Powers of Appointment. The following provisions relate to all powers of appointment created by the Grantor at any time and to any power ex~rcisable by or under this Trust. I i... (a) A general power of appointment granted to a person is one that can be exercised in favor of that person or' his or her estate, his or her creditors, or the creditors of his or'her estate. (b) A special power of appointment is any power that is not a general power. ( c) A testamentary power of appointment (either general or special) is exercisable upon the powerholder's death by his or her Last Will or by a revocable trust agreement established by that person, but only by specific reference to the instrument creating the power. A "testamentary power of appointment" may not be exercised in favor of the person possessing the power. (d) In determining whether a person has exercised a testamentary power of appointment, the Trustees may rely upon an instrument admitted to probate in any jurisdiction as that person's Last Will, or upon any trust agreement certified to be valid and authentic by sworn statement of the trustee who is serving under that trust agreement. If the Trustees have not received written notice of such an instrument within six months after the powerholder's death, the Trustees may presume that the powerholder failed to exercise that power and will not be liable for acting in accordance with that presumption. (e) The Grantor expressly refrains from exercising any power of appointment that he may possess at his death. 18.3 Notices. Any person entitled or required to give notice under this Trust shall exercise that power by a written instrument witnessed by two impartial persons, clearly setting forth the effective date of the action for which notice is being given. The instrument may be executed in counterparts. Notice of the Grantor's exercise of any power under this Trust need be given only to the affected Trustees. 18.4 Certifications. (a) From Personal Representatives. For some purposes, the Trustees are authorized to rely on a certificate from the Grantor's Personal Representatives as to 25 . .... . certain facts. That certificate must be in writing and witnessed by two impartial persons, but need not be notarized. It is to be delivered to the Trustees in the same fashion as provided for other notices. (b) Facts. A certificate signed and acknowledged by the Trustees stating any fact affecting the Trust Estate or the trust agreement will be conc1u~ive evidence of such fact in favor of any transfer agent and any other person dealing .in good faith with the Trustees. The Trustees may rely on a certificate signed and acknowledged by any beneficiary stating any fact concerning the Trust beneficianes, includingdates-.ofbirth, relationships, or marital status, unless an individual. serving as Trustee has actual knowledge that the stated fact is false. . I ~ (c) Copy. Any person mAy rely on a copy' of this instrument (in whole or in part) certified to be a true copy by the Grantor; by any person specifically named as a Trustee (or successor Trustee); by any Corporate Trustee whether or not specifically named; or, if there are none of the above, by any then serving Trustee. 18.5 Dispute Resolution. If there is a dispute or controversy of any nature involving the disposition or administration of this Trust, the Grantor directs the parties in dispute to submit the matter to mediation or some other method of alternative dispute resolution selected by them. If a party refuses to submit the matter to alternative dispute resolution, or if a party refuses to participate in good faith, the Grantor authorizes the court having jurisdiction over the Trust to award costs and attorney's fees from that party's beneficial share or from other amounts payable to that party (including amounts payable to that party as compensation for service as fiduciary) as in chancery actions. 18.6 Effect of Adoption. A legally adopted child (and any descendants of that child) will be regarded as a descendant of the adopting parent only if the petition for adoption was filed with the court before the child's thirteenth birthday. If the legal relationship between a parent and child is terminated by a court while the parent is alive, that child and that child's descendants will not be regarded as descendants of that parent. If a parent dies and the legal relationship with that deceased parent's child had not been terminated before that parent's death, the deceased parent's child and that child's descendants will continue to be regarded as descendants of the deceased parent even if the child is later adopted by another person. 18.7 Infant in Gestation. For all purposes of this Trust, an infant in gestation who is later born alive will be deemed to be in being during the period of gestation for the purpose of qualifying the infant, after it is born, as a beneficiary of this Trust. 18.8 Applicable Law. All matters involving the validity and interpretation of this Trust are to be governed by Florida law. Subject to the provisions of this Trust, all matters involving the administration of a trust are to be governed by the laws of the jurisdiction in which the trust has its principal place of administration. 26 , . , . 18.9 Gender and Number. Reference in this Trust to any gender includes either masculine or feminine, as appropriate, and reference to any number includes both singular and plural where the context permits or requires. Use of descriptive titles for articles and paragraphs is for the purpose of convenience only and is not intended to restrict the application of those provisions. 18.10 Further Instruments. The Grantor agrees . to execute such further instruments as may be necessary to vest the Trustees with full legal title to the property transferred to this Trust. 18.11 Acknowledgments: Aclq1q)Vledgments of this trust agreement and matters affecting the administration of the Trust may be given for purposes of recording such instruments, but the absence of an acknowlodgment d().es not affect the validity of those instruments. 18.12 Binding Effect. This trust agreement extends to and is binding upon the Grantor's Personal Representatives, succe,ssors, and assigns, and upon the Trustees. Executed as of the date fIrst written above. GRANTOR AND TRUSTEE ~J. ci~' fl' ~~ Neil A. OIDonnell This instrument was signed, sealed, published, and declared by the Grantor as his Trust Agreement in our joint presence, and at his request we have signed our names as attesting witnesses in his presence and in the presence of each other on the date fIrst written above. Name Address f4~ J~&dfJL ~#~ )W/~ I~/. 27 UT '. ,. l/i .. STATE OF FLORIDA COUNTY OF INDIAN RIVER I, Neil A. O'Donnell, declare to the officer taking my acknowledgment of this instrument, and to the subscribing witnesses, that I signed this instrument as my Trust Agreement. " ~ a,' CP~IJ1h~ Neil A. O'Donnell We, Sheryll A. Thogersen and {!JL..o,1 &Ja.. "rer , have been sworn by the officer signing below, and declare to that officer on our oaths that the Grantor declared the instrument to be his Trust Agreement and 'signed it, in our presence, and 'that we each signed the instrument as a witness in the Pres~~to~ther. ~~~~AA~ Acknowledged and subscribed before me by the Grantor, Neil A, O'Donnell, who is personally known to me or who has produced Phn 'J... 0-, ~ U ~dentification, and by Sheryll A. Thogersen, who is' personally known to me, and by {JJ.~t1( /1 ,8ela"Ap , who is personally known to me or who has produced f?ec:,()1tA..iI<t J::M,wrV as identification, and subscribed by me in the presence of the Grantor and the subscribing witnesses, all on June 25,2003, .....,,'31/"'" . ,*,'4 ~~ STEPHEN CONNELLY :.: :"1 MY COMMISSION /I DO 083888 :/ EXPIRES; FebrtJaly 20 2006 . Bonded Thru Notary Pubic Und.wn... No