HomeMy WebLinkAbout08-60130
Donald L. Kornfield, Esq.
Andrew J. Benchoff, Esq.
Attorneys for Plaintiffs
Kornfield and Benchoff, LLP
17 North Church Street
Waynesboro, PA 17268
Phone: (717) 762-8222
Fax: (717) 762-6544
DENNIS L. MOWERS, ROBERT D.
MOWERS, RICKY J. MOWERS, and
RICHARD V. MOWERS, Plaintiffs
vs.
LINDA MOWERS, Successor Trustee of
The Floyd J. Mowers and Lillian C.
Mowers Revocable Trust Agreement
Dated September 14, 2005,
Defendant
IN THE COURT OF COMMON PLEAS
OF THE 9TH JUDICIAL DISTRICT, PA
CUMBERLAND COUNTY
CIVIL ACTION - LAW
No. 2008- 6013 Gov"
Judge:
NOTICE
You have been sued in Court. If you wish to defend against the claims set forth in the
following pages, you must take action within twenty (20) days after this application and notice
are served by entering a written appearance personally or by an attorney and filing in writing
with the Court your defenses or objections to the claims set forth against you. You are'warned
that if you fail to do so, the case may proceed without you and a judgment may be entered
against you by the Court without further notice for any money claimed in the application or for
any other claims or relief requested by the Plaintiffs. You may lose money or property or other
rights important to you.
YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU
DO NOT HAVE A LAWYER, GO TO OR TELEPHONE THE OFFICE SET FORTH
BELOW. THIS OFFICE CAN PROVIDE YOU WITH INFORMATION ABOUT
HIRING A LAWYER.
IF YOU CANNOT AFFORD TO HIRE A LAWYER, THIS OFFICE MAY BE
ABLE TO PROVIDE YOU WITH INFORMATION ABOUT AGENCIES THAT MAY
OFFER LEGAL SERVICES TO ELIGIBLE PERSONS AT A REDUCED FEE OR NO
FEE.
Cumberland County Bar Association
32 South Bedford Street
Carlisle, PA 17013
Telephone Numbers: 717-249-3166 and 1-800-990-9108
AMERICANS WITH DISABILITIES ACT OF 1990
The Court of Common Pleas of Cumberland County is required by law to comply with
the Americans with Disabilities Act of 1990. For information about accessible facilities and
reasonable accommodations available to disabled individuals having business before the Court,
please contact our office. All arrangements must be made at least 72 hours prior to any hearing
or business before the Court. You must attend the scheduled conference or hearing.
OFF, LLP
6 ?`
Date: /p(?
Donald L. K
Attu--kD. No 1
Date: 1010-4168
Andrew nchof , Esq.
Atty. I. 0.8915
Attome for Plaintiffs
Donald L. Kornfield, Esq.
Andrew J. Benchoff, Esq.
Attorneys for Plaintiffs
Kornfield and Benchoff, LLP
17 North Church Street
Waynesboro, PA 17268
Phone: (717) 762-8222
Fax: (717) 762-6544
DENNIS L. MOWERS, ROBERT D.
MOWERS, RICKY J. MOWERS, and
RICHARD V. MOWERS, Plaintiffs
vs.
LINDA MOWERS, Successor Trustee of
The Floyd J. Mowers and Lillian C.
Mowers Revocable Trust Agreement
Dated September 14, 2005,
Defendant
IN THE COURT OF COMMON PLEAS
OF THE 9TH JUDICIAL DISTRICT, PA
CUMBERLAND COUNTY
CIVIL ACTION - LAW
No. 2008-
Judge:
PLAINTIFFS' APPLICATION
TO COMPEL ARBITRATION AND APPOINT ARBITRATOR
Pursuant to 42 Pa. C.S.A. §§ 7304 and 7305
NOW COME Plaintiffs Dennis L. Mowers, Robert D. Mowers, Ricky J. Mowers, and
Richard V. Mowers, by and through their attorneys Donald L. Kornfield, Esq. and Andrew J.
Benchoff, Esq., Kornfield and Benchoff, LLP, and set forth Plaintiffs' Application to Compel
Arbitration and Appoint Arbitrator, pursuant to 42 Pa. C.S.A. §§ 7304 and 7305, as follows:
1. Plaintiffs are Dennis L. Mowers, Robert D. Mowers, Ricky J. Mowers, and Richard V.
Mowers, all of whom are sui juris individuals, and all of whom are Beneficiaries under The
Floyd J. Mowers and Lillian C. Mowers Revocable Trust Agreement dated September 14, 2005
(hereinafter referred to as "the Trust"), a copy of which is attached hereto as Exhibit "A," and
incorporated herein by reference, with an address c/o Dennis L. Mowers, 9827 Ritner Highway,
Pleasant Hall, PA 17246.
2. Defendant is Linda Mowers, believed and therefore averred to be a sui juris individual,
who is a Beneficiary under and Successor Trustee of the Trust, with an address of 2128 Ritner
Highway, Shippensburg, PA 17257.
3. There is an existing dispute or controversy between Plaintiffs and Defendant concerning
the construction or application of one or more terms, provisions, or conditions of the Trust,
including but not limited to its assets, its debts, its net value and/or assets, whether credits to
and/or debits from the Trust were properly handled and accounted for by Defendant, and the
proper procedure for distribution of the net value and/or assets of the Trust.
:1 - 11
4. Section 7.01 of the Trust requires that resolution of conflicts be handled through a
specific arbitration procedure and that any controversy under the Trust shall be submitted to
arbitration.
5. On June 20, 2008, Donald L. Kornfield, Esq. (hereinafter referred to as "Kornfield") sent
a letter to Defendant, which among other things, sought an accounting of the actions she took
since becoming Successor Trustee, and sought an itemization of the specific property included
within the Trust. A copy of the letter is attached hereto as Exhibit "B," and incorporated herein
by reference.
6. On September 15, 2008, in response to a letter received from Johnna J. Kopecky, Esq.
(hereinafter referred to as "Kopecky") on behalf of Defendant, Kornfield sent a letter to
Kopecky, which among other things, requested arbitration under Section 7.01 of the Trust, and
which appointed Elliott B. Sulcove, Esq., as arbitrator for Plaintiffs under Section 7.01 of the
Trust. A copy of the letter is attached hereto as Exhibit "C," and incorporated herein by
reference.
7. On October 2, 2008, Kornfield left Kopecky voicemail stating that Plaintiffs intended to
file the instant application, requesting a return call, and indicating that if a return call was not
made he would interpret same as a refusal to arbitrate and proceed with the filing of the instant
application.
8. In addition, on October 2, 2008, Kornfield faxed a draft form of the instant application to
Kopecky, and seeking Defendant's agreement to arbitrate under the specific procedure in Section
7.01 of the Trust. A copy of the forwarding letter is attached hereto as Exhibit "D," and
incorporated herein by reference.
9. Kopecky left a voice mail for Kornfield on October 3 advising that Defendant has not
responded to a letter from Kopecky asking Defendant to contact her about the instant matter.
10. Section 7.01 of the Trust requires that each party to any controversy shall appoint one
person to hear and determine the dispute, and if they are unable to agree, the two persons so
chosen shall select a third impartial arbitrator whose decision shall be final and conclusive upon
both parties.
11. Plaintiffs respectfully request that this Honorable Court enter an Order to compel
arbitration pursuant to 42 Pa. C.S.A. § 7304.
12. In addition, Plaintiffs respectfully request that this Honorable Court Order Defendant to
appoint one person to hear and determine the dispute as is required under Section 7.01 of the
Trust within 30 days pursuant to 42 Pa. C.S.A. § 7304, and if Defendant fails to follow the Trust
requirement and the Order, Elliott B. Sulcove, Esq. shall on praecipe of Plaintiffs be Ordered the
sole arbitrator to hear and determine the dispute according to the commercial arbitration rules of
the American Arbitration Association.
WHEREFORE, Plaintiffs respectfully request that this Honorable Court enter an Order to
compel arbitration, and in addition, respectfully request that this Honorable Court Order
Defendant to appoint one person to hear and determine the dispute within 30 days, and if
Defendant fails to follow Section 7.01 of the Trust and the Order, Elliott B. Sulcove, Esq. shall
be the sole arbitrator to hear and determine the dispute according to the commercial arbitration
rules of the American Arbitration Association.
Respectfully submitted,
OFF, LLP
Date: 11) 6 01
Date: 10104Og
L. Korhfie)1d, Esq.
I verify that the statements made in this application are true and correct. I understand that
false statements herein are made subject to the penalties of 18 Pa.C.S.A. Section 4904, relating to
unsworn falsification to authorities.
Date: ?D 6 DY
Atty. I.D. No.
THE FLOYD J. MOWERS AND LILLIAN C. MOWERS REVOCABLE TRUST
AGREEMENT
DATED: +-6-' 2- o
BETWEEN: FLOYD J. MOWERS and LILLIAN C. MOWERS
AS SETTLORS
AND: FLOYD J. MOWERS and LILLIAN C. MOWERS
AS TRUSTEES
Floyd J. Mowers and Lillian C. Mowers, residents of 2128 Ritner Highway, Shippensburg,
County of Cumberland, in the Commonwealth of Pennsylvania, do hereby establish a Trust (the
"Trust") upon the conditions and for the purposes hereafter set forth.
ARTICLE ONE
Section 1.01 Trust Estate Defined
This Trust is formed to hold title to real and personal property for the benefit of the Settlors of
the Trust and to provide for the orderly use and transfer of these assets upon the death of the
Settlors. The "Trust Estate" is defined as all property transferred or conveyed to, and received by
the Trustee and held pursuant to the terms of this instrument. The Trustee is required to hold,
administer, and distribute this property as provided in this Trust Agreement.
The Settlors shall list the property held in the Trust on Schedule A, which is bound together with
and made a part of this Trust Agreement by reference thereto, and which may be amended from
time to time by the Settlors as property is added to or removed from the Trust.
The Settlors acknowledge that they have transferred to the Trustee, without consideration, the
sum of Fifty Dollars ($50.00), which was the original corpus of the Trust Estate.
Additional property may be added to the Trust Estate at any time by the Settlors or either of
them, or by any person or persons, by inter vivos or testamentary transfer. All such original and
additional property constituting the Trust Estate shall be held, managed and distributed as herein
provided.
Section 1.02 Employee Benefit Plans
In the event that any designation of the Trustee of this Trust as beneficiary in any employee
benefit plan in which the Settlors may have an interest shall be ineffectual in whole or in part, the
Trust Agreement Page 1
EXHIBIT
A
Settlors specifically request that the committee, or other group having authority to do so under
such plan, select the Trustee of the Trust as beneficiary of such plans to the maximum extent
possible. The Trustee may elect the mode of payment which, in the Trustee's discretion, appears
to be the most advantageous option available to the Trust and/or its then-current income
beneficiaries in terms of income, estate, and inheritance tax, and/or investment return
considerations, based on the Trustee's evaluation of the facts and circumstances relevant to such
considerations as they exist at the time the Trustee makes such election. Further, the Trustee
may, predicated upon the foregoing considerations, elect in writing not to treat the death
benefits as a lump sum distribution for income tax purposes and thus exclude the same from
estate taxes. An election by the Trustee in good faith in the exercise of the discretionary power
conferred upon it shall be final and binding upon all persons whomsoever and shall be a full
acquittance and discharge to the Trustee, and the Trustee shall not be liable to any person by
reason of its exercise of such discretionary power.
1.03 Life Insurance
The Trustee may be named as beneficiary of death benefit proceeds of life insurance policies.
Such death benefit proceeds will be subject to all the terms hereof. The Trustee shall not be
obligated to pay any premiums, assessments, or other charges on any policies not owned by the
Trust, nor to keep anyone informed with respect thereto. The Trustee shall not be responsible
for any acts or omissions of the owners in connection with any policy. The owner of each policy
in which the Trustee is named beneficiary but is not the owner has reserved all rights, option, and
privileges, including all incidents of ownership, conferred by the terms of the policies. Such
rights shall include, but not be limited to, the right to change the beneficiaries of such policies.
1.04 Retention of Property Character
During the joint lives of the Settlors, any property transferred to this Trust shall retain its original
character and, in the event of revocation, the Trustee shall distribute such property to the
respective Settlors based on the same property rights they had prior to transfer to the Trust.
Section 1.05 Other Definitions
As used in this Trust Agreement
1. The term "Husband" shall mean Floyd J. Mowers.
2. The term "Wife" shall mean Lillian C. Mowers.
3. The term "Settlor" shall refer individually and collectively to Husband and Wife.
4. The term "descendant" shall mean the lawful issue of a deceased parent in the line
of descent, but does not include the issue of any parent who is a descendant of the
-_? deceased person in question and "who is living at the time in question.
Trust Agreement Page 2
5. The terms "child" and "descendant" include any issue born to a decedent, a child
legally adopted by the decedent, and a posthumous child of a decedent. A
posthumous child is to be considered as living at the time of his or her parent's
death.
6. The term "survives" or "surviving", unless otherwise indicated herein, shall be
construed to mean surviving the decedent for at least sixty (60) days. If the person
referred to dies within sixty (60) days of the death of the decedent, the reference to
him or her will be construed as if he or she had failed to survive the decedent;
provided, however, that any such person will have, during such period, the right to
the use and enjoyment as a life tenant of all property in which his or her interest
will fail by reason of death during such period.
7. The term "issue" will include all natural and adopted children if applicable, and
descendants and those legally adopted into the line of descent.
8. The term "per stirpes" means strict per stirpes and does not mean per capita with
representation. Beneficiaries entitled to take under a "per stirpes" clause will
include both natural and adopted children and their descendants.
9. The term "Trust" includes the initial Trust established hereunder as well as any
separate trust established under the terms of this Trust Agreement.
10. The terms "Trust Assets" and "Trust Estate" include all assets of any trust created
hereunder and income derived from such assets and all proceeds of any
description derived from the sale, exchange, or other disposition of such assets.
11. When required to give reasonable effect to the context in which used, pronouns in
the masculine, feminine, or neuter gender include each other, and nouns and
pronouns in the plural or singular number include each other.
Section 1.06 Trustee Designation
Husband and Wife are hereby designated as Co-Trustees. The Co-Trustees shall serve jointly
and severally and either shall have full authority to act for the Trust independently. Should either
Husband or Wife become unable because of death, incapacity, or other cause to serve as a Co-
Trustee, or should either Husband or Wife resign as Co-Trustee before the natural termination of
this Trust, the remaining Co-Trustee (Husband or Wife) shall thereafter serve as sole Trustee,
except where another Co-Trustee or special trustee is provided for hereinafter with respect to a
separate trust created upon the death of one of the Settlors. The term "Trustee" as used in this
Trust Agreement shall refer collectively to Husband and Wife so long as they serve as Co-
Trustees, to the spouse who serves as the sole Trustee, and/or to any Successor Trustee or
Successor Trustees collectively who assume the role of Trustee. These Trustees shall serve in the
Trust Agreement Page 3
order as provided in Section 9.01 of this Trust Agreement.
Section 1.07 Apportionment
The Trustee of the Trust is directed to apportion receipts and expenditures of the types described
below between principal and income as follows:
1. Whenever the principal, or any part thereof, of the Trust Estate is invested in
securities purchased at a premium or at a discount, any premium will be charged
against principal and any discount will be credited to principal;
2. Any stock dividends and rights to purchase additional stock issued on securities
held in trust will be treated as principal. All other dividends, except liquidating
distributions, will be treated as income; and
3. The amount of any applicable depletion allowance for federal income tax
purposes will be treated as income.
Section 1.08 Administration of Trust During the Settlors' Lifetimes
The Trustee shall hold, manage, invest, and reinvest the Trust Estate and shall collect the income
thereof, and shall, upon demand of the Settlors, pay to the Settlors during their joint lives all net
u ' income of the joint property in the Trust Estate and shall pay to each Settlor all separate net
- t income from his or her respective share of the Trust Estate. In the event that the Settlors do not
demand payment of the net income of joint property, or, if either of the Settlors fails to demand
distribution of separate property net income, then the Trustee may in its discretion accumulate
such income, and such income will become the property of the Trust Estate.
The Trustee shall further pay principal, up to the whole thereof, to the Settlors upon written
request. Upon the written request of the Settlor who transferred separate estate property to the
Trust, the Trustee shall pay so much of the principal of the separate estate established by such
Settlor, up to the whole thereof, as he or she shall request.
Section 1.09 Discretionary Termination
The Trustee may terminate the Trust when, in the opinion of the Trustee, the principal is reduced
to such an extent that it is not in the best interest of the Beneficiary or Beneficiaries to continue
the Trust. The judgment of the Trustee with respect to this decision to terminate will be final and
not subject to judicial review. If the Trustee terminates a Trust according to this Section, the date
the Trust terminates will be deemed the date fixed for termination of the Trust, and the Trustee
will distribute the assets of the terminating Trust to the Beneficiary or Beneficiaries pursuant to
this Agreement.
Trust Agreement Page 4
Section 1.10 Amendment and Revocation
The Settlors hereby retain the following powers, exercisable at any time during their lifetimes:
1. To withdraw any of the property included in a separate share of the Trust Estate
by giving the Trustee written notice specifying the property so withdrawn, in
which event, the Trustee shall promptly transfer and deliver such property to us or
the respective Settlor's designee.
2. To amend the provisions of this Trust Agreement in any respect without the
necessity of securing the consent of the Trustee to such changes, in which event, a
copy of the amendment shall be promptly furnished to the Trustee; provided,
however, that following the death of one of the Settlors, the survivor shall have no
power to amend the terms of the Trust Agreement with respect to the Trust Share
of the first Settlor to die.
To revoke this Trust by giving the Trustee written notice of such revocation, in
which event the Trustee shall promptly transfer and deliver the property
constituting the Trust Estate to the Settlors or their designee together with an
accounting therefore; provided, however, that following the death of one Settlor,
the survivor shall have no power to revoke the terms of the Trust Agreement with
respect to the Trust Share of the first Settlor to die.
4. Any and all gifts of Trust Assets shall constitute a revocation by the Settlors as to
Trust administration over such property, whether such gift is made by a Settlor or
by the Trustee at written direction of each of the Settlors.
5. If a Settlor is incapacitated such power to revoke, alter, or amend the Trust may be
exercised by the agent of such Settlor without approval of any court, or by the
Guardian or Conservator at the direction of a court of competent jurisdiction.
Section 1.11 Irrevocability
Except as otherwise provided, on the death of either Settlor, the designation of Beneficiaries of
specific gifts in this Trust Agreement shall become irrevocable and not subject to amendment or
modification.
Section 1.12 Settlor Powers
The surviving Settlor shall be the Trustee unless and until he or she resigns in writing or is
determined incapacitated under the terms provided herein. The surviving Settlor shall retain all
absolute rights to discharge or replace any Successor Trustee of any portion or share of the Trust
which is revocable by the surviving Settlor so long as the Settlor is competent.
Trust Agreement Page 5
ARTICLE TWO
Section 2.01 Protection of Settlor in Event of Incapacity
During the joint lives of the Settlors, should either Settlor become incapacitated as defined in
Section 2.02 below, the Trustee may, in the Trustee's absolute discretion, pay income and
principal for the benefit of the incapacitated Settlor. In addition, the Trustee, in his or her
absolute discretion, may pay to or apply, for the benefit of that Settlor, such sums from the net
income and from the principal of the Settlor's separate Trust Share as the Trustee believes is
necessary or advisable for the medical care, comfortable maintenance, and welfare of the Settlor.
Section 2.02 Inca acity
A person is determined to be incapacitated if any Trustee or Beneficiary hereunder
comes into possession of any of the following:
a. A jurisdictionally applicable court order holding the party to be legally
incapacitated to act on his on her behalf and appointing a guardian or
conservator to act for him or her; or
b. Written certificates which are duly executed, witnessed, and
acknowledged of two licensed physicians, each certifying that the
physician has examined the person and has concluded that, by reason of
accident, mental deterioration, or other cause, such person has become
incapacitated and can no longer act rationally and prudently in his or her
own financial best interest; or
Evidence which such Trustee or Beneficiary deems to be credible and
currently applicable that a person has disappeared, is unaccountably
absent, or is being detained under duress, and that he or she is unable to
effectively and prudently look after his or her own best interests.
2. In the event that a person is determined to be incapacitated as provided above,
then in that event and under those circumstances:
a. Such person is deemed to have become incapacitated, as that term is used
in this Trust agreement; and
b. Such incapacity is deemed to continue until such court order, certificates,
and/or circumstances are inapplicable or have been revoked.
3. A physician's certificate to the effect that the person is no longer incapacitated
shall revoke a certificate declaring the person incapacitated. The certificate which
1
Trust Agreement Page 6
revokes the earlier certificate may be executed by either the original certifying
physician or by two other licensed, board certified physicians. No Trustee shall be
under any duty to institute any inquiry into a person's possible incapacity. The
reasonable expense of any such inquiry shall be paid from the Trust Assets.
Section 2.03 Principal Invasion
During the joint lives of the Settlors, should the net income of assets contained in this Trust be
insufficient to provide for the care, maintenance, or support of the Settlors as herein defined, the
Trustee may, in the Trustee's sole and absolute discretion, pay to or apply for the benefit of the
Settlors or either of them, or any of their dependents, such amounts from the principal of the
Trust Estate as the Trustee deems necessary or advisable for the care, maintenance, or support of
the Settlors.
Section 2.04 Residence
If the Settlors' residence property is part of the Trust, the Settlors shall have possession of and
full management of the residence and shall have the right to occupy it free of rent. Any expenses
arising from the maintenance of the property and from all taxes, liens, assessments, and insurance
premiums, are to be paid from the Trust to the extent that assets are available for payment. It is
the intent of the Settlors to retain all homestead rights available to them under the applicable state
law.
ARTICLE THREE
Section 3.01 Allocation of Assets Upon Death of One Spouse
Upon the death of either of the Settlors, the assets of this Trust shall remain in the Trust with the
surviving Settlor as primary trustee and primary Beneficiary except that the surviving Settlor
shall have the right to disclaim all or any part of the deceased Settlor's interest in the Trust Estate.
Said assets disclaimed shall be selected by the surviving Settlor out of the Trust Assets including,
but not limited to, any assets gifted, transferred or poured over into this Trust at any time. Upon
said disclaimer of assets by the surviving Settlor, the disclaimed whole or portion shall be
distributed to and administered pursuant to the provisions for the Non-Marital Share as described
below.
Section 3.02 Non-Marital Share
Upon disclaimer of assets pursuant to the previous provisions, the disclaimed
whole or portion shall be distributed to a separate trust, hereinafter referred to as
the Credit Shelter Trust, to be held and administered as follows:
Trust Agreement Page 7
a. Upon the death of either Settlor, the surviving Settlor and Linda Mowers
shall be co-trustees of the Credit Shelter Trust and shall be entitled to
manage the assets of the Credit Shelter Trust; but the plan of distribution
and all terms of this Credit Shelter Trust shall be irrevocable and
unamendable upon the death of either Settlor. The surviving Settlor shall
be entitled to receive all of the income therefrom for life. In addition to
other payments from the Credit Shelter Trust as herein authorized, there
shall be paid to the surviving Settlor during the surviving Settlor's lifetime
from the principal of the Credit Shelter Trust upon the surviving Settlor's
written request during the last month of each calendar year of the Credit
Shelter Trust, an amount not to exceed the greater of five thousand dollars
($5,000) or five percent (5%) of the total value of the principal of the
Credit Shelter Trust on the last day of the calendar year without reduction
for the principal payment for such calendar year. This $5,000 or five
percent (5%) right of withdrawal is non-cumulative, so if the surviving
Settlor does not withdraw the full amount to which the surviving Settlor is
entitled during a calendar year, the surviving Settlor's right to withdraw the
$5,000 or five percent (5%) for that year shall lapse at the end of the
calendar year.
b. After the preceding provisions are complied with, Linda Mowers and shall
act as special trustees of the Credit Shelter Trust, with sole right and power
to distribute principal over and above the distributions authorized in the
preceding provisions to the surviving Settlor. The special trustees, in the
special trustees' sole discretion, may distribute all or any part of the
principal of the Credit Shelter Trust remaining after the preceding
provisions are complied with, to or for the benefit of the surviving Settlor
in such proportions and in such amounts as the special trustees deem
appropriate.
C. Notwithstanding any other provisions of this Trust Agreement, under no
circumstances shall the surviving Settlor act as sole trustee of the Credit
Shelter Trust. This paragraph shall take precedence over any other
provisions of this Trust Agreement.
d. If the surviving Settlor is unable or unwilling to act as co-trustee of the
Credit Shelter Trust, then Linda Mowers shall act as trustees of the Credit
Shelter Trust with all the rights and responsibilities given to the original
trustees of the Credit Shelter Trust.
e. If Linda Mowers is unable or unwilling to act as trustee, then Dennis
Mowers shall serve as co-trustee or sole trustee of the Credit Shelter
Trust, as the case may be, with all rights and responsibilities given to the
original trustee of the Credit Shelter Trust.
Trust Agreement Page 8
f. The trustees of the Credit Shelter Trust shall have the same administrative
powers given to the Trustees under Section 5.02 below.
g. The Credit Shelter Trust trustees shall act without bond and shall make
such accounting to the Beneficiaries as the trustees, in the trustees sole
discretion deem advisable. Said Credit Shelter Trust trustees shall not be
required to make any current reports or accountings to any court nor to any
Beneficiaries.
h. The Credit Shelter Trust trustees shall serve without compensation.
2. Upon the death of the surviving Settlor, the assets then remaining in the Credit
Shelter Trust shall be distributed after giving effect to the section of this Trust
Agreement entitled "Special Directives", to the following Beneficiaries in the
indicated shares:
Linda K.Mowers corner cupboard, jewelry, plus one-fifth of
the residue of the estate
Dennis L. Mowers choice of gun, plus one-fifth of the residue
of the estate
Robert D. Mowers choice of gun, plus one-fifth of the residue
of the estate
Ricky J. Mowers choice of gun, plus one-fifth of the residue
of the estate
Richard V. Mowers choice of gun, plus one-fifth of the residue
of the estate
Any child shall have the option to purchase the family farm from the other
beneficiaries, at a price that is agreed upon by the rest.
If any of the Beneficiaries named immediately above who are natural persons do
not survive the surviving Settlor, then the share that would otherwise have passed
to that deceased Beneficiary shall be distributed to that deceased Beneficiary's
issue then living per stirpes. In the event said issue have not attained the age of
twenty-one (21) then said share shall be held, in trust. If the deceased Beneficiary
has no issue which survive the surviving Settlor, then the share that would
otherwise have been distributed to the deceased Beneficiary named above shall be
distributed to the other Beneficiary(ies) named above on a pro-rata basis.
Section 3.03 Plan of Distribution Upon Death of Surviving Settlor
1. Upon the death of the surviving Settlor, the successor Trustee(s) shall take charge
of the Trust Assets, pay all of the legally enforceable debts of the surviving
Settlor, including the expenses of the last illness and funeral expenses of the
Trust Agreement Page 9
surviving Settlor, current bills, and any and all other expenses incurred in closing
out this Trust and making distributions of assets thereof.
The Successor Trustee(s) shall divide personal effects, including automobiles,
boats, sporting equipment, jewelry, furniture, furnishings, china, glassware, silver
and household equipment (except those items which are specifically given to a
Beneficiary elsewhere in this Trust Agreement, in which case said specific gift
shall take precedence over this paragraph), among Linda K.Mowers, Dennis L.
Mowers, Robert D. Mowers, Ricky J. Mowers, and Richard V. Mowers (or, if any
of them are deceased, their issue by representation) as they may agree or, failing
such agreement, in such manner as the Successor Trustee(s) may deem equitable.
If Linda K.Mowers, Dennis L. Mowers, Robert D. Mowers, Ricky J. Mowers, and
Richard V. Mowers (or their issue by representation) do not agree, the Successor
Trustee(s) shall have full discretion to determine the division and distribution of
the articles above referred to between Linda K.Mowers, Dennis L. Mowers,
Robert D. Mowers, Ricky J. Mowers, and Richard V. Mowers (or their issue by
representation) and such determination shall be binding on all persons. If any
Beneficiary is a minor at the time of such division, distribution shall be made to
the person having custody of him or her for purposes of this provision, and the
receipt of such person for the distributable share of such minor shall fully and
completely release the Successor Trustee(s) from responsibility for such personal
property.
2. The assets then remaining in the Trust shall be distributed after giving effect to the
section of this Trust Agreement entitled "Special Directives", in the manner as
described in Section 3.02, above.
Section 3.04 If All Beneficiaries Predecease
Upon the death of the surviving Settlor, if neither Beneficiaries nor alternate Beneficiaries named
herein survive, then the Trust Assets shall be distributed fifty percent (50%) to the heirs at law of
Husband and fifty percent (50%) to the heirs at law of Wife.
Section 3.05 Power to Appoint Agents
The surviving spouse shall have the right to retain an accountant and/or an attorney at law for
professional services on behalf of the Trust Estate or Estates herein. The surviving spouse shall
not be responsible for the acts of such agents beyond his or her obligation to use reasonable care
in the selection of such agents.
Section 3.06 Maximum Marital Deduction
Except as otherwise expressly stated herein, the term "maximum marital deduction" shall not be
construed as a direction by the deceased Settlor to exercise any election respecting the deduction
Trust Agreement Page 10
of estate administration expenses, the determination of the estate tax valuation date, or any other
tax election which may be available under any tax laws, only in such manner as will result in a
larger allowable estate tax marital deduction than if the contrary election had been made.
Section 3.07 Trust Income After the First Death
Following the death of either Settlor and until the death of the surviving Settlor, the Trustee shall,
at least annually, pay to or apply for the benefit of the surviving Settlor all of the net income from
the Trust Estate.
Section 3.08 Simultaneous Death
If the Settlors should die under circumstances which would render it doubtful as to which Settlor
died first, it shall be conclusively presumed for the purposes of this Trust that husband died first.
If any other Beneficiary and a Settlor should die under such circumstances, it shall be
conclusively presumed that the Beneficiary predeceased such Settlor.
Section 3.09 Last Expenses
Upon the death of each of the Settlors, the Trustee(s) of this Trust may, in their discretion, pay
any part of or all of the funeral and burial expenses, probate claims, administration expenses, and
any estate inheritance, successions, or other death taxes, which are payable as a result of the
death of each of the Settlors, out of that portion of the Trust Estate constituting the deceased
Settlor's separate Trust Share. The Trustee(s) may make any such payments directly to the
creditors or taxing authority in question, or may remit funds to the personal representative of the
Estate of the deceased spouse for such payments.
ARTICLE FOUR
Section 4.01 Common Pot Trust
At the death of the Surviving Settlor, the Trustee shall not create a Common Pot Trust. All of the
Trust Estate that has not been distributed under prior Articles of the Trust Agreement shall be
held, administered, divided, and distributed according to the provisions set forth above.
Section 4.02 Payment of the Second Death Expenses
On the death of the Surviving Settlor, the Trustee shall pay the expenses of the surviving
Settlor's last illness, funeral, burial, and any inheritance, estate, or death taxes that may be due by
reason of the Surviving Settlor's death unless the Trustee in his or her absolute discretion
determines that other adequate provisions have been made for the payment of such expenses and
Trust Agreement Page 11
4
taxes.
Section 4.03 Principle of Representation
Unless indicated differently in this Trust Agreement or in the "Special Directives" section that
follows, in the event any of the named Beneficiaries should predecease both Settlors, all of that
person's share of the Trust Estate is to be divided equally among the deceased Beneficiary's
children or issue per stirpes. In the event the predeceased Beneficiary leaves no surviving
children or issue, then all of the person's share of the Trust Estate shall be divided equally among
the remaining Beneficiaries per stirpes.
If a Beneficiary of the Settlors survives both Settlors, but should fail to survive to collect his or
her share at distribution, the share shall pass to the surviving issue of that deceased Beneficiary
per stirpes and with right of representation.
ARTICLE FIVE
Section 5.01 Non-Income Producing Property
During the joint lives of the Settlors, the Trustees are authorized to retain in the Trust, for so long
as the Trustees may deem advisable, any property received by the Trustees from the Settlors,
whether or not such property is of the character permitted by law for the investment of Trust
funds.
Section 5.02 Trustees Powers
The Trustees shall have all powers conferred upon a Trustees by law for the orderly
administration of the Trust Estate. If any property is distributed outright under the provision of
this Trust Agreement to a person who is a minor, distribution may be made under the
Pennsylvania Uniform Transfer to Minors Act ("PAUTMA"). The Trustees are further
authorized to sign, deliver, and/or receive any documents necessary to carry out the powers
contained within this Section.
The Trustees of any trust under this Trust Agreement (including any substitute or successor
Trustees) will have and be subject to all of the powers, duties, and responsibilities granted or
imposed by the Pennsylvania Consolidated Statutes (20 Pa. C. S. Section 101 et seq.) as such
Statute may provide at the time of administration of the Trust, except to the extent that the same
are inconsistent with the provisions of this Agreement.
Section 5.03 Specific Powers of Trustees
In addition, the Trustees will have the following specific powers:
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1. Trust Estate: The Trustees may, leave invested any property coming into its hands
hereunder in any form of investment even thought the investment may not be of
the character of investments permitted by law to trustees, without liability for loss
or depreciation in value. The Trustees may sell, exchange, or otherwise dispose
of an reinvest property which may at any time be a part of the Trust Estate upon
such terms and conditions as the Trustees may deem advisable. The Trustees may
invest and reinvest the Trust Assets from time to time in any property real,
personal, or mixed, including without limitation, securities of domestic and
foreign corporations and investment trusts of companies, bonds, debentures,
preferred stocks, common stocks, mortgages, mortgage participation, and interests
in common trust funds, all with complete discretion to convert realty into
personalty or personalty into realty or otherwise change the character of the Trust
Estate, even though such investment (by reason of its character, amount,
proportion to the total Trust Estate, or otherwise) would not be considered
appropriate for a fiduciary apart from this provision and even though such
investment caused part or all of the total trust Estate to be invested in investments
of one type or of one business or company.
2. Holding Property: The Trustees may hold property in the Trustees' name, as
Trustees, or in the name of a nominee without disclosing this Trust.
3. Release of Power: If the Trustees deem it to be in the best interest of the Trust and
its Beneficiaries, the Trustees, by written instrument signed by such Trustees, will
have the power and authority to release, disclaim, or restrict the scope of any
power or discretion granted in this Trust Agreement or implied by law.
4. Agents, Employees: The Trustees may employ one or more agents to perform
any act of administration, whether or not discretionary, including attorneys,
auditors, investment managers, or others, as the Trustees shall deem necessary or
advisable. The Trustees may compensate agents and other employees and may
delegate to them any and all discretions and powers.
5. Leases: The Trustees may lease any Trust Assets generally or for oil, gas, and
mineral development, even though the lease term may extend beyond the term of
the Trust of which the property is a part. The Trustees may enter into any
covenants, and agreements relating to the property so leased or concerning any
improvements which may then or thereafter be erected on such property.
6. Common Funds: The Trustees may hold any of the Trust Assets in a common
fund with property from other trust estates and may make investments jointly with
any other trust, the property of which is included in the common fund.
7. Securities: With respect to securities held in the Trust Estate, the Trustees may
exercise all the rights, powers, and privileges of an owner, including but not
Trust Agreement Page 13
limited to, the power to vote, give proxies, and to pay assessments and other sums
deemed by the Trustees necessary for the protection of the Trust Estate. In
addition, the Trustees may participate in voting trusts, foreclosures,
reorganizations, consolidations, mergers, liquidations, and in connection
therewith, to deposit securities with and transfer title to any protective or other
committee under such terms as the Trustees may deem advisable. In addition, the
Trustees may exercise or sell stock subscription or conversion rights and may
accept and retain as an investment any securities or other property received
through the exercise of any of the foregoing powers, regardless of nay limitations
elsewhere in this instrument relative to investments by Trustees.
8. Purchases from Estate: The Trustees may purchase property of any kind from the
executor or administrator of our estates.
9. Lending: The Trustees may make loans, secured or unsecured, to the executor or
administrator of our estates, to any Beneficiary of this Trust, or to the Trustees.
Further, the Trustees may use Trust Assets to guarantee obligations of any income
Beneficiary of this Trust (unless such Beneficiary is serving as Trustees).
10. Distributions to or for Beneficiaries: The Trustees may make any distribution
contemplated by this Trust Agreement (1) to the Beneficiary: (2) if the Beneficiary
is under a legal disability or if the Trustees determines that the Beneficiary is
unable to properly manage his or her affairs, to a person furnishing support,
-- maintenance, or education for the Beneficiary or with whom the Beneficiary is
residing for expenditures on the Beneficiary's behalf, or (3) if the Beneficiary is a
minor, to a Trustees of an existing trust established exclusively for the benefit of
such minor, whether created by this Trust Agreement or otherwise, or to a
custodian for the Beneficiary, as selected by the Trustees, under the Pennsylvania
Uniform Transfer to Minors Act. Alternatively, the Trustees may apply all or a
part of the distribution for the Beneficiary's benefit. Any distribution under this
paragraph will be a full discharge of the Trustees with respect thereto. On any
partial or final distribution of the Trust Assets, the Trustees may apportion and
allocate the assets of the Trust Estate in cash or in kind, or partly in cash and
partly in kind, or in undivided interests in the manner deemed advisable at the
discretion of the Trustees and to sell any property deemed necessary by the
Trustees to make the distribution. The Trustees may distribute gifts of up to
$10,000.00 per year per donee out of principal and/or interest.
11. Insurance: The Trustees may purchase new life insurance, pay the premiums on
existing life insurance on the life of any Trust Beneficiary, purchase annuities
(either commercial or private) from any corporation, trust, or individual, and may
procure and pay the premiums on other insurance of the kinds, forms, and
amounts deemed advisable by the Trustees to protect the Trustees and the Trust
Estate.
Trust Agreement Page 14
12. Borrowing: The Trustees may borrow money from the Trust Estate and others. To
secure the repayment thereof, the Trustees may mortgage, pledge, or otherwise
encumber part or all of the Trust Assets, and in connection with the acquisition of
any property, the Trustees may assume a liability or may acquire property subject
to a liability.
13. Repairs: The Trustees may make ordinary and extraordinary repairs and
alterations to buildings or other Trust Assets.
14. Reserves: The Trustees may establish such reserves out of income for taxes,
assessments, repair, and maintenance as the Trustees consider appropriate.
15. Continuation of Business: The Trustees may continue any business or businesses
in which the Trust has an interest at the time of the Settlor's death for so long as
the Trustees may, in its sole discretion, consider necessary or desirable, whether
or not the business is conducted by the Settlors at the time of their death
individually, as a partnership, or as a corporation wholly owned or controlled by
them, with full authority to sell, settle, and discontinue any of them when and
upon such terms and conditions as the Trustees may, in their sole discretion,
consider necessary or desirable.
16. Retain Property for Personal Use: The Trustees may retain a residence or other
property for the personal use of a Beneficiary and allow a Beneficiary to use or
occupy the retained property free of rent and maintenance expenses.
17. Dealing with Third Parties: The Trustees may deal with any person or entity
regardless of relationship or identity of any Trustees to or with that person or
entity. The Trustees may hold or invest any part of or all of the Trust Estate in
common or undivided interests with that person or entity.
18. Partitions, Divisions, Distributions: The Trustees will have the power to make all
partitions, divisions, and distributions contemplated by this Trust Agreement.
Any partitions, divisions, or other distributions may be made in cash, in kind, or
partly in cash and partly in kind, in a manner that the Trustees deems appropriate
(including composing shares differently). The Trustees may determine the value
of any property, which valuation will be binding on all Beneficiaries. No
adjustments are required to compensate for any partitions, divisions, or
distributions having unequal consequences to the Beneficiaries.
19. Claims Controversies: The Trustees may maintain and defend any claim or
controversy by or against the Trust without the joinder or consent of any
Beneficiary. The Trustees may commence or defend at the expense of the Trust
any litigation with respect to the Trust or any property of the Trust Estate as the
Trustees may deem advisable. The Trustees may employ, for reasonable
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compensation, such counsel as the Trustees shall deem advisable for that purpose.
20. Merger of Trusts: If at any time the Trustees of any trust created hereunder shall
also be acting as Trustees of any other trust created by trust instrument or by trust
declaration for the benefit of the same Beneficiary or Beneficiaries and upon
substantially the same terms and conditions, the Trustees are authorized and
empowered, if in the Trustees' discretion such action is in the best interest of the
Beneficiary or Beneficiaries, to transfer and merge all of the assets then held
under such trust created pursuant to this Trust Agreement to and with such other
trust and thereupon to terminate the trust created pursuant to this Trust
Agreement. The Trustees are further authorized to accept the assets of any other
trust which may be transferred to any trust created hereunder and to administer
and distribute such assets and properties so transferred in accordance with the
provisions of this Agreement.
21. Termination of Small Trust: Any corporate Trustee which is serving as the sole
Trustee of any Trust or any Share thereof may at any time terminate such Trust or
Share if, in the Trustee's sole judgment, the continued management of such Trust
or Shares is no longer economical because of the small size of such Trust or Share
and if such action will be deemed to be in the best interests of the Beneficiary or
Beneficiaries. In case of such termination, the Trustee will distribute forthwith
the share of the Trust Estate so terminated to the income Beneficiary, per stirpes.
Upon such distribution, such Trust or Share will terminate and the Trustee will
not be liable or responsible to any person or persons whomsoever for its action.
The Trustee will not be liable for failing or refusing at any time to terminate any
Trust or a Share thereof as authorized by this paragraph.
22. Power to Determine Income and Principal: Dividends payable in stock of the
issuing corporation, stock splits, and capital gains will be treated as principal.
Except as herein otherwise specifically provided, the Trustees will have full
power and authority to determine the manner in which expenses are to be borne
and in which receipts are to be credited as between principal and income. The
Trustees have the power to determine what will constitute principal or income and
may withhold from income and reserves for depreciation or depletion as the
Trustees may deem fair and equitable. In determining such matters, the Trustees
may given consideration to the provisions of the Pennsylvania Statutes (or its
successor statutes) relating to such matters, but it will not be bound by such
provisions.
23. Generation-Skipping Taxes and Payment: If the Trustees consider any distribution
or termination of an interest or power hereunder as a distribution or termination
subject to a generation-skipping tax, the Trustees are authorized
a. To augment any taxable distribution by an amount which the Trustees
Trust Agreement Page 16
estimate to be sufficient to pay such tax and charge the same to the
particular trust to which the tax related without adjustment of the relative
interests of the Beneficiaries;
b. To pay such tax, in the case of a taxable termination, from the particular
trust to which the tax relates without adjustment of the relative interests of
the Beneficiaries. If such tax is imposed in part by reason for the Trust
Assets, the Trustees will pay only the portion of such tax attributable to the
taxable termination hereunder taking into consideration deductions,
exemptions, credits, and other factors which the Trustees deem advisable;
and
c. To postpone final termination of any particular trust and to withhold any
portion or all of the Trust Estate until the Trustees are satisfied that the
Trustees no longer have any liability to pay any generation-skipping tax
with reference to such trust or its termination.
Section 5.04 Special Provision for S Corporation Stock
Notwithstanding what is otherwise provided in this Trust Agreement, if at any time the Trust
contains any stock of a corporation which elects or has elected treatment as an "S Corporation"
as defined by Section 1361(a)(1) of the Internal Revenue Cod (or any corresponding successor
statute), such stock will be segregated from the other assets of such and treated as a separate
_ trust. The Trustees will further divide the separate trust into shares for each Beneficiary and such
shares will be distributed outright or held in trust as herein provided. In addition, all other
provisions of this Trust Agreement will apply to each share held in trust (and constituting a
separate trust) except that the Trustees will distribute all of the income from each separate trust to
its Beneficiary in convenient installments at least annually. It is the Settior's intent that each
separate trust will be recognized as a "Qualified Subchapter S Trust" ("QSST") under Section
1361(d)(2) of the Internal Revenue Code (or any corresponding successor statute). .
Notwithstanding any provisions of this Trust Agreement to the contrary, the Trustees's powers
and discretions with respect to the administration of each separate trust (including methods of
accounting, bookkeeping, making distributions, and characterizing receipts and expenses) will
not be exercised or exercisable except in a manner consistent with allowing each separate trust to
be treated as a QSST as above described.
ARTICLE SIX
Section 6.01 Coordination with Settlors' Probate Estates
At any time during the continuance of this Trust, including subsequent to the
Trust Agreement Page 17
death of either Settlor, the Trustee(s) may, in their sole and uncontrolled
discretion, distribute to the deceased Settlor's probate estate cash and/or other
property as a Beneficiary of the Trust.
2. All other provisions to the contrary notwithstanding, under no circumstances shall
any restricted proceeds, as hereinafter defined, be either directly or indirectly (1)
distributed to or for the benefit of the deceased Settlor's executors or the deceased
Settlor's probate estate; or (ii) used to pay any other obligations of the deceased
Settlor's estate. The term "restricted proceeds" means:
a. All qualified plans, individual retirement accounts, or similar benefits
which are received or receivable by any Trustee hereunder, and which are
paid solely to a Beneficiary other than the executor of the Settlor's gross
estate for Federal estate tax purposes; and
b. All proceeds of insurance on the Settlor's life which, if paid to a
Beneficiary other than the Settlor's estate, would be exempt from
inheritance or similar death taxes under applicable state death laws.
Section 6.02 Direction to Minimize Taxes
In the administration of the Trust hereunder, its fiduciaries shall exercise all available tax related
elections, options, and choices in such manner 4s they, in their sole but reasonable judgment
(where appropriate, receiving advice of tax counsel), believe will achieve the overall minimum in
total combined present and reasonably anticipated future administrative expenses and taxes of all
kinds. This applies not only to said Trust, but also to its Beneficiaries, to the other Trusts
hereunder and their Beneficiaries, and to the Settlor's probate estate.
Without limitation on the generality of the foregoing direction (which shall to that extent
supercede the usual fiduciary duty of impartiality), such fiduciaries shall not be accountable to
any person interested in this Trust or to Settlor's estate for the manner in which they shall carry
out this direction to minimize overall taxes and expenses (including any decision they may make
not to incur the expense of a detailed analysis of alternative choices). Even though their
decisions in this regard may result in increased taxes or decreased distributions to the Trust, to
the estate, or to one or more Beneficiaries, the fiduciaries shall not be obligated for compensation
readjustments or reimbursements which arise by reason of the manner in which the fiduciaries
carry out this direction.
Section 6.03 Judgment and Discretion of Trustee
In the absence of proof of bad faith, all questions of construction or interpretation of any trusts
created by this Trust Agreement will be finally and conclusively determined solely by the
Trustee, according to the Trustee's best judgment and without recourse to any court. Each
determination by the Trustee is binding on the Beneficiaries and prospective Beneficiaries
Trust Agreement Page 18
hereunder, both ii being and unborn, as well as all other persons, firms, or corporations. The
Trustee, when exercising any discretionary power relating to the distribution or accumulation of
principal or income or to the termination of any trust, will be responsible only for lack of good
faith in the exercise of such power. Each determination may be relied upon to the same extent as
if it were a final and binding judicial determination. In the event of a conflict between the
provisions of this Trust Agreement and those of the Pennsylvania Statutes, the provisions of this
Agreement will control.
ARTICLE SEVEN
Section 7.01 Resolution of Conflict
Any controversy between the Trustee or Trustees and any other Trustee or Trustees, or between
any other parties to this Trust, including Beneficiaries, involving the construction or application
of any of the terms, provisions, or conditions of this Trust shall, on the written request of either
or any disagreement party served on the other or others, shall be submitted to arbitration. The
parties to such arbitration shall each appoint one person to hear and determine the dispute and, if
they are unable to agree, then the two persons so chosen shall select a third impartial arbitrator
whose decision shall be final and conclusive upon both parties. The cost of arbitration shall be
borne by the losing party or in such proportion as the arbitrator(s) shall decide. Such arbitration
shall comply with the commercial arbitration rules of the American Arbitration Association, 140
West 51" Street, New York, NY 10200
Section 7.02 Incontestability
The beneficial provisions of this Trust Agreement are intended to be in lieu of any other rights,
claims, or interests of whatever nature, whether statutory or otherwise, except bona fide pre-death
debts, which any Beneficiary hereunder may have in Settlor's estate or in the properties in trust
hereunder. Accordingly, if any Beneficiary hereunder asserts any claim (except a legally
enforceable debt), statutory election or other right or interest against or in Settlor's estate, or any
properties of this Trust, other than pursuant to the express terms hereof, or directly or indirectly
contests, disputes, or calls into question, before any court, the validity of this Trust Agreement
then:
Such Beneficiary shall thereby absolutely forfeit any and all beneficial interests of
whatever kind and nature while such Beneficiary or his or her heirs might
otherwise have under this Trust Agreement and the interests of the other
Beneficiaries hereunder shall thereupon be appropriately and proportionately
increased; and
2. All of the provisions of this Trust Agreement, to the extent that they confer any
benefits, powers, or rights whatsoever upon such claiming, electing, or contesting
\I_ Trust Agreement Page 19
Beneficiary, shall thereupon become absolutely void; and
3. Such claiming electing, or contesting Beneficiary, if then acting as a Trustee
hereunder, shall automatically cease to be a Trustee and shall thereafter be
ineligible either to select, remove, or become a Trustee hereunder.
Section 7.03 Specific Omissions
Any and all persons and entities, except those persons and entities specifically named herein,
have been intentionally omitted from this Trust Agreement. If any person or entity shall
successfully challenge any term or condition of this Trust Agreement, then, to that person or
entity shall be given the sum of one dollar ($1.00) in lieu and in place of any other benefit, grant,
or interest which that person or interest may have in the Trust Estate.
Section 7.04 Benefits Confidential
The Settlors further declare that it is their desire and intent that the provisions of this Trust
Agreement are to remain confidential as to all parties. The Settlors direct that only the
information concerning the benefits paid to any particular Beneficiary shall be revealed to such
individual and that no individual shall have a right to information concerning the benefits being
paid to any other Beneficiary. '
ARTICLE EIGHT
Section 8.01 Distribution in Kind or in Cash
On any division of the assets of the Trust Estate into shares, and on any final or partial
distribution of the assets of the Trust Estate, the Trustee, at his or her absolute discretion, may
divide and distribute undivided interests of such assets on a pro rate or non-pro rata basis, or may
sell any part of or all of such assets and may make divisions or distributions in cash or partly in
cash and partly in kind. The decision of the Trustee, either prior to or on any division or
distribution of such assets, as to what constitutes a proper division of such assets of the Trust
Estate, shall be binding on all persons interested in any trust provided for in this Trust
Agreement.
Section 8.02 Spendthrift Provisions
Neither the principal nor the income of this Trust Agreement shall be liable for the debts of a
Beneficiary. Except as otherwise expressly provided in this Agreement, no Beneficiary of any
trust shall have any right, power, or authority to alienate, encumber, or hypothecate this or her
interest in the principal or income of this Trust Agreement in any manner, nor shall the interests
of any Beneficiary be subject to the claims of his or her creditors or liable to attachment,
Trust Agreement Page 20
M
execution, or other process of law. The limitations herein shall not restrict the exercise of any
power of appointment or the right to disclaim.
Section 8.03 Definition of Children
The terms "child" and "children" as used in this Agreement mean the lawful issue of a Settlor or
of the Settlors together. This definition also includes children legally adopted by a Settlor or by
the Settlors together.
Section 8.04 Handicapped Beneficiaries
Any Beneficiary who is determined by a court of competent jurisdiction to be incapacitated shall
not have any discretionary rights of a Beneficiary with respect to this Trust, or to their share or
portion thereof. The Trustee shall hold and maintain such incapacitated Beneficiary's share of
the Trust estate and shall, in the Trustee's sole discretion, provide for such Beneficiary as that
Trustee would provide for a minor. Notwithstanding the foregoing, any Beneficiary who is
diagnosed for the purposes of governmental benefits (as hereinafter delineated) as being
incapacitated or as being disabled, and who shall be entitled to governmental support and
benefits by reason of such incapacity or disability, shall cease to be a Beneficiary of this Trust.
Likewise, they shall cease to be a Beneficiary if any share or portion of the principal or income of
the Trust shall become subject to the claims of any governmental agency for costs or benefits,
fees, or charges.
` .__. The portion of the Trust Estate which, absent the provisions of this section, would have been the
share of such incapacitated or handicapped person shall be retained in trust for as long as that
individual lives. The Trustee, at his or her sole discretion, shall utilize such funds for the
maintenance of that individual. If such individual recovers from his or her incapacity or
disability and is no longer eligible for aid from any governmental agency, including costs or
benefits, fees, or charges, such individual shall be reinstated as a Beneficiary after 60 days from
such recovery and the allocation and distribution provisions as stated herein shall apply to that
portion of the Trues Estate which is held by the Trustee subject to the foregoing provisions of
this section. If said handicapped Beneficiary is no longer living and shall leave children then
living, the deceased child's share shall pass to those children per stirpes. If there are no children,
the share shall be allocated proportionately among the remaining Beneficiaries.
ARTICLE NINE
Section 9.01 Trustees
All Trustees are to serve without bond. The following will act as Trustees of any Trusts created
by this Trust Agreement, in the following order of succession:
Trust Agreement Page 21
First: The undersigned, Floyd J. Mowers and Lillian C. Mowers.
Second: The Surviving Spouse
Third: Upon the end of the terms of the original Trustees, Linda Mowers is
hereby designated Successor Trustee as well as special trustee of any QTIP
trust or credit-shelter trust created hereunder.
Fourth: If Linda Mowers is unable or unwilling to act as Successor Trustee and/or
special trustee, then Dennis Mowers shall serve as Successor Trustee
and/or special trustee, as the case may be.
Last: A:Titeechoseri_b Elea Qty oE$eneficianes with a: arent ox legal,
guardiatrvoting foi:,,minorEdf es- provided.. however, that the _
-chiW&of any deceased, Beneficiary shall collectively have only one vote..
Section 9.02 Allocation and Distribution of the Trust Assets
The Trustees shall allocate, hold, administer, and distribute the Trust Assets as hereinafter
provided:
1. Upon the death of the first Settlor, the Trustee shall make any separate
distributions that have been specified by the deceased Settlor. The Trustee shall
also take into consideration the appropriate provisions of this Article.
2. Upon the death of the Surviving Spouse, the Trustee shall hold, administer, and
distribute the Trust Assets in the manner herein prescribed.
Section 9.03 Personal Propggy Distribution
Notwithstanding any provision of this Trust Agreement to the contrary, the Trustee must abide by
any memorandum by the Settlors, particularly that contained in the section entitled "Special
Directives" incorporated into this Trust Instrument and any exhibits attached to this Trust
Agreement containing Special Directives of the Settlors, directing the disposition of Trust Assets
of every kind including, but not limited to, furniture, appliances, furnishings, pictures, china,
silverware, glass, books, jewelry, wearing apparel, and all policies of fire, burglary, property
damage, and other insurance on or in connection with the use of property. Otherwise, any
personal and household effects of the Settlors shall be distributed with the remaining assets of the
Trust Estate.
Section 9.04 Liability of Trustee
The Trustee will not be responsible or liable for any loss which may occur by reason of
depreciation in value of the properties at any time belonging to the Trust Estate nor for any other
Trust Agreement Page 22
loss which may occur, except that the Trustee will be liable for each Trustee's own negligence,
neglect, default, or willful wrong. The Trustee will not be liable or responsible for the acts,
omissions, or defaults of any agent or other person to whom duties may be properly delegated
hereunder (except officers or regular employees of the Trustee if such agent or person was
appointed with due care). The Trustee may receive reimbursement from the Trust Estate for any
liability, whether in contract or in tort, incurred in the administration of the Trust Estate in
accordance with the provisions hereof, and the Trustee may contract in such form that such
Trustee will be except from such personal liability and that such liability will be limited to the
Trust Assets.
Section 9.05 Successor Trustees
Any Successor Trustee shall have all the power, rights, discretion, and obligations conferred on a
Trustee by this Trust Agreement. All rights, titles, and interest in the property of the Trust shall
immediately vest in the successor Trustee at the time of appointment. The prior Trustee shall,
without warranty, transfer to the Successor Trustee the existing Trust property. No successor
Trustee shall be under any duty to examine, verify, questions, or audit the books, records,
accounts, or transaction of any preceding Trustee; and no Successor Trustee shall be liable for
any loss or expense from or occasioned by anything done or neglected to be done by a
predecessor Trustee. A Successor Trustee shall be liable only for his or her own acts and defaults.
ARTICLE TEN
Section 10.01 Perpetuities Savings Clause
Notwithstanding any other provision of this instrument, the Trusts created hereunder shall
terminate not later than twenty-one (21) years after the death of the last survivor of all Settlors
and any other Beneficiary or Beneficiaries named or defined in this Trust living on the date of the
death of the first Settlor to die. The Trustee shall distribute remaining Trust principal and all
accrued or undistributed net income hereunder to the Beneficiary or Beneficiaries. If there is
more than one Beneficiary, the distribution shall be in the proportion in which they are
Beneficiaries; if no proportion is designated, then the distribution shall be in equal shares to such
Beneficiaries.
ARTICLE ELEVEN
Section 11.01 Governing Law
It is not intended that the laws of only one particular state shall necessarily govern all questions
pertaining to all of the Trust hereunder.
Trust Agreement Page 23
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1. The validity of the Trust hereunder, as well as the validity of the particular
provisions of the Trust, shall be governed by the laws of the state which has
sufficient connection with the Trust to support such validity.
2. The meaning and effect of the terms of this Trust Agreement shall be governed by
the laws of the Commonwealth of Pennsylvania.
3. The administration of this Trust shall be governed by the laws of the state in
which the principal office of the Trustee then having custody of the Trust's
principal assets and records is located.
The foregoing shall apply even though the situs of some Trust Assets or the home of the Settlors,
a Trustee, or a Beneficiary may at some time or times be elsewhere.
Section 11.02 Invalidity of Any Provision
If a court finds that any provision of this Trust Agreement is void, invalid, or unenforceable, the
remaining provisions of this Agreement will continue to be fully effective.
Section 11.03 Headings
The use of headings in connection with the various articles and sections of this Trust Agreement
is solely for convenience and the headings are to be given no meaning or significance whatsoever
in construing the terms and provisions of this Agreement.
Section 11.04 Internal Revenue Code Terminology
As used herein, the words "gross estate," "adjusted gross estate," "taxable estate," "unified
credit," "state death tax credit," "maximum marital deduction," "marital deduction," and any
other word or words which from the context in which it or they are used refer to the'Internal
Revenue Code shall be assigned the same meaning as words have for the purposes of applying
the Internal Revenue Code to a deceased Settlor's estate. Reference to sections of the Internal
Revenue Code and to the Internal Revenue Code shall refer to the Internal Revenue Code
amended to the date of such Settlor's death.
ARTICLE 12
Section 12.01 Special Directives of Floyd J. Mowers.
Floyd J. Mowers hereby directs that any specific distribution of assets from the
Trust Estate provided for on the list attached hereto and marked "Exhibit A-
Special Directives of Floyd J. Mowers" (if any) be made before the distributions
`? Trust Agreement Page 24
to the named Beneficiaries as set forth above.
2. Floyd J. Mowers hereby acknowledges and accepts the "Special Directives," if any,
of Lillian C. Mowers.
attorney-in-fact,
Linda Mowers
Section 12.02 Special Directives of Lillian C. Mowers.
2.
SETTLORS:
Lillian C. Mowers hereby directs that any specific distribution of assets from the
Trust Estate provided for on the list attached hereto and marked "Exhibit A-Special
Directives of Lillian C. Mowers" (if any) be made before the distributions to the
named Beneficiaries as set forth above.
Lillian C. Mowers hereby acknowledges and accepts the "Special Directives," if any,
of Floyd J. Mowers.
Floyd J. Mowers
CO-TRUSTEES:
_?%4 io
Floyd J. Mowers
Lillian C. Mowers, by her
Lillian C. Movve , by her
COMMONWEALTH OF PENNSYLVANIA
COUNTY OF CUMBERLAND
The undersigned certifies that on the day of " M4?v& , t_t,?5-
Floyd J. Mowers, known to me or satisfactorily proven t me to be the person whose name is
subscribed to the foregoing document, personally appeared before me and acknowledged that he
executed the same as Settlor and Co-Trustee for the purposes therein contained.
a,_c
attorney-in-fact,
Linda Mowers
10 ° S
OMMONWEALTH OF PENNSYLVANIA
Notarial3eal
Patrick J. Mci.aughtin. Notary Public
Upper MorslsndTwp., MontgomerYCounty
My Commission I*m June 21.2008
Member, Pennsylvania Assodedon of Notaries
COMMONWEALTH OF PENNSYLVANIA
COUNTY OF CUMBERLAND
The undersigned certifies that on the day of? A??""'
Lilli er attorney-in-fact, Linda Mow s known to me or satisfactorily proven
__ 4r
me to be the perso hose name is subscribed to the foregoing document, personally appeared
before and ac ledged that in that capacity, s}e executed the same as Settlor and Co-Trustee
C MONW TH OF PENN YL.VANIA
Notarial seal
Patrick J. Mcl,nughlin,Notary Public
Upper Moreland Twp.. MontgomeryComtty
My Commission Expires June 21, 2008
Member, Pennsylvania Association of Notaries
Kornfield and Benchoff, LLP
Attorneys At Law
17 North Church Street
Waynesboro, PA 17268
www.kornfieldandbenchoff.com
Donald L. Kornfield, Esq. Phone: 717-762-8222
Andrew I Benchoff, Esq. Fax: 717-762-6544
don@komfield.net
Kimberly S. Runshaw
Paralegal andrew(a?kornfeld.net
?une 20, 2008
Linda Mowers
2128 Ritner Highway
Shippensburg, PA 17257 `-'-?
Re: The Fl J. Mowers and Lillian C. Mowers
Revoc, le Trust Agreement dated September
14, 2005
Dear Ms. Mowers:
We have been retained to represent Dennis L. Mowers, Robert D. Mowers, Ricky J. Mowers,
and Richard V. Mowers about the trust agreement.
Pursuant to Article Nine of the Trust you were designated Successor Trustee upon the death
of your mother, Lillian. Pursuant to Article Three, Section 3.02.2, upon the death of Lillian, the
assets then remaining in the Trust must be distributed to the beneficiaries, you and your brothers.
No distribution has been made and our clients do not know what property remains in the
Trust although they believe there is real estate and personal property, including accounts with
Orrstown Bank. Please provide me'with an accounting of the actions you have undertaken on behalf
of the Trust since becoming Trustee, and itemize the specific property included within the Trust.
Kindly respond within ten days and consider this letter a demand for arbitration under Section
7.01 of the Trust Agreement.
Sincerely,
KORNFIELD AND BENCHOFF, LLP
Donald L. Kornfield
cc: Dennis L. Mowers
Robert D. Mowers
Ricky J. Mowers
Richard V. Mowers
EXHIBIT
s
Kornfield and Benchoff, LLP
Attorneys At Law
17 North Church Street
Waynesboro, PA 17268
www.kornfieldandbenchoff.com
Donald L. Kornfield, Esq.
Andrew J. Benchoff, Esq.
Kimberly S. Runshaw
Paralegal
September 15, 2008
Johnna J. Kopecky, Esq.
The Shagin Law Group, LLC
The Inns of St. Jude
120 South Street
P.O. Box 1225
Harrisburg, PA 17108-1225
Phone: 717-762-8222
Fax: 717-762-6544
don@komfield.net
a.ndrew(a?komfield.net
Re: Floyd J. Mowers and Lillian C. Mowers Trust
Dear Ms. Kopecky:
My clients would like to pursue arbitration of the matters in dispute pursuant to Section 7.01
of the September 14, 2005 Trust Agreement.
We appoint Elliott Sulcove, Esq., of Black and Davison, 82 West Queen Street, P.O. Box
513, Chambersburg, PA 17201, as arbitrator. Mr. Sulcove charges $185.00 per hour and he has
confirmed his firm has no conflict-of-interest in acting as arbitrator for the parties. Please let me
know at your earliest convenience whether your client is agreeable to our selection for arbitrator or
whether you will appoint your own.
Another concern has arisen with distribution of an annuity. Previously the siblings agreed to
have equal checks written to each of the four but the company issued two, one to Linda and one to
Dennis. Would Linda return her check so the company can reissue four checks?
Sincerely,
Donald L. Kornfield
cc: Elliott Sulcove, Esq.
Dennis Mowers
EXHIBIT
C
Kornfield and Benchoff, LLP
Attorneys At Law
17 North Church Street
Waynesboro, PA 17268
www.kornfieldandbenchoffcom
Donald L. Kornfield, Esq.
Andrew J. Benchoff, Esq.
Kimberly S. Runshaw
Paralegal
VIA FAX (717) 221-1110
Johnna J. Kopecky, Esq.
The Shagin Law Group, LLC
The Inns of St. Jude
120 South Street
P.O. Box 1225
Harrisburg, PA 17108-1225
Dear Ms. Kopecky:
October 2, 2008
Phone: 717-762-8222
Fax: 717-762-6544
don@komfield.net
andrew(a?.kom fiel d.net
Re: Floyd J. Mowers and Lillian C. Mowers Trust
In follow-up to my earlier voicemail, enclosed please find a form application, which we
intend to file next week with the Cumberland County Court of Common Pleas and have served on
Linda Mowers if we do not hear from you.
Thank you.
Sincerely,
KORNFIELD AND BENCHOFF, LLP
Donald L. Kornfield
Enc. (w/o Exhibits)
cc: Dennis, Robert, Ricky, and Richard Mowers
EXHIBIT
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SHERIFF'S RETURN - REGULAR
CASE NO: 2008-06013 P
COMMONWEALTH OF PENNSYLVANIA:
COUNTY OF CUMBERLAND
MOWERS DENNIS L ET AL
VS
MOWERS LINDA ET AL
MICHAEL BARRICK
Sheriff or Deputy Sheriff of
Cumberland County,Pennsylvania, who being duly sworn according to law,
says, the within APPL-COMPEL ARBITRATIO
was served upon
MOWERS LINDA TRUSTEE OF FLOYD & LILLIAN MOWERS REV TRUST the
DEFENDANT , at 0020:23 HOURS, on the 13th day of October , 2008
at 2128 RITNER HIGHWAY
SHIPPENSBURG, PA 17257 by handing to
LINDA MOWERS DEFENDANT
a true and attested copy of APPL-COMPEL ARBITRATIO together with
NOTICE & PLAINTIFF'S APPLICATION TO COMPEL
ARBITRATION & APPOINT ARBITRATOR
and at the same time directing Her attention to the contents thereof.
Sheriff's Costs:
Docketing 18.00
Service 13.00
Affidavit .00
Surcharge 10.00
Postage
101n.1er .42
41.42
Sworn and Subscibed to
before me this day
So Answers:
- e_?4
R.''Thomas Kline
10/14/2008
KORNFIELD & BENCHOFF
By:
Deputy Sheriff
of A. D.
Donald L. Kornfield, Esq.
Andrew J. Benchoff, Esq.
Attorneys for Plaintiffs
Kornfield and Benchoff, LLP
17 North Church Street
Waynesboro, PA 17268
Phone: (717) 762-8222
Fav (717) 762-6544
DENNIS L. MOWERS, ROBERT D. IN THE COURT OF COMMON PLEAS
MOWERS, RICKY J. MOWERS, and OF THE 9TH JUDICIAL DISTRICT, PA
RICHARD V. MOWERS, Plaintiffs
CUMBERLAND COUNTY
vs.
CIVIL ACTION - LAW
LINDA MOWERS, Successor Trustee of
The Floyd J. Mowers and Lillian C.
Mowers Revocable Trust Agreement No. 2008- 0613
Dated September 14, 2005,
Defendant Judge:
PLAINTIFFS' MOTION TO ORDER ARBITRATION AND APPOINT ARBITRATOR
NOW COME Plaintiffs Dennis L. Mowers, Robert D. Mowers, Ricky J. Mowers, and
Richard V. Mowers, by and through their attorneys Donald L. Kornfield, Esq. and Andrew J.
Benchoff, Esq., Kornfield and Benchoff, LLP, and set forth Plaintiffs' Motion to Order
Arbitration and Appoint Arbitrator, as follows:
1. Plaintiffs are Dennis L. Mowers, Robert D. Mowers, Ricky J. Mowers, and Richard V.
Mowers, all of whom are sui juris individuals, and all of whom are Beneficiaries under the Trust.
2. Defendant is Linda Mowers, who is a Beneficiary under and Successor Trustee of the
Trust, with an address of 2128 Ritner Highway, Shippensburg, PA 17257.
3. Plaintiffs commenced the above action by filing Plaintiffs' Application to Compel
Arbitration and Appoint Arbitrator on October 7, 2008.
4. Defendant was served with Plaintiffs' Application to Compel Arbitration and Appoint
Arbitrator on October 13, 2008.
5. Counsel for Defendant, Johnna J. Kopecky, Esq., The Shagin Law Group, LLC, The Inns
of St. Jude, 120 South Street, P.O. Box 1225, Harrisburg, PA 17108-1225, verbally advised
counsel for Plaintiffs on October 24, 2008 that Defendant would agree to final and binding
arbitration to resolve any and all outstanding disputes with respect to the Trust, and the
appointment of Elliott B. Sulcove, Esq., Black and Davison, 82 West Queen Street, P.O. Box
513, Chambersburg, PA 17201, as the sole arbitrator.
6. Counsel for Defendant concurs with the relief requested herein.
WHEREFORE, the parties respectfully request that this Honorable Court enter an Order
requiring arbitration, and in addition, appointing Elliott B. Sulcove, Esq. the sole arbitrator to
hear and determine the dispute according to the commercial arbitration rules of the American
Arbitration Association, per the proposed Order attached hereto.
Respectfully submitted,
Date: November 6, 2008
I verify that the statements made in this application are true and correct. I understand that
false statements herein are made subject to the penalties of 18 Pa.C.S.A. Section 4904, relating to
unsworn falsification to authorities.
Date: November 6, 2008
DENNIS L. MOWERS, ROBERT D.
MOWERS, RICKY J. MOWERS, and
RICHARD V. MOWERS, Plaintiffs
vs.
LINDA MOWERS, Successor Trustee of
The Floyd J. Mowers and Lillian C.
Mowers Revocable Trust Agreement
Dated September 14, 2005,
Defendant
IN THE COURT OF COMMON PLEAS
OF THE 9TH JUDICIAL DISTRICT, PA
CUMBERLAND COUNTY
CIVIL ACTION - LAW
No. 2008-6013 Civil Term
Judge:
CERTIFICATE OF SERVICE
This is to certify that in this case, not yet assigned to a Judge, complete copies of all
papers contained in Plaintiffs' Motion to Order Arbitration and Appoint Arbitrator have been
served upon the following person(s), by the following means and dates stated:
Johnna J. Kopecky, Esq.
The Shagin Law Group, LLC
The Inns of St. Jude
120 South Street
P.O. Box 1225
Harrisburg, PA 17108-1225
VIA: Fax (717) 221-1110
DATE: November 4, 2008
I verify that the statements made in this Certificate are true and correct. I understand that
false statements herein are made subject to the penalties of 18 Pa. C.S.A. Section 4904 relating to
unsworn falsification to authorities.
P
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. e.T.
77
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Donald L. Kornfield, Esq.
Andrew J. Benchoff, Esq.
Attorneys for Plaintiffs
Komfield and Benchoff, LLP
17 North Church Street
Waynesboro, PA 17268
Phone: (717) 762-8222
Fax: (717) 762-6544
DENNIS L. MOWERS, ROBERT D.
MOWERS, RICKY J. MOWERS, and
RICHARD V. MOWERS, Plaintiffs
CUMBERLAND COUNTY
vs.
IN THE COURT OF COMMON PLEAS
OF THE 9TH JUDICIAL DISTRICT, PA
CIVIL ACTION - LAW
LINDA MOWERS, Successor Trustee of
The Floyd J. Mowers and Lillian C.
Mowers Revocable Trust Agreement No. 2008-6013 Civil Term
Dated September 14, 2005,
Defendant Judge:
ORDER OF COURT
NOW THIS day of 2008, upon presentation and consideration _LV of the foregoing Motion to Order Arbitration and Appoint Arbitrator, and with the consent of the
parties,
IT 1S HEREBY ORDERED as follows:
1.) The parties to the above-captioned matter shall promptly submit any and all
disputes under the Trust to arbitration, said arbitration to be in accordance
with Section 7.01 of the Trust and in compliance with the commercial
arbitration rules of the American Arbitration Association, and said arbitration
shall be scheduled for a date no less than one hundred twenty (120) days from
the date of entry of this Order of Court;
2.) Elliott B. Sulcove, Esq., Black and Davison, 82 West Queen Street, P.O. Box
513, Chambersburg, PA 17201, shall be the sole arbitrator, unless the parties
mutually agree to (an) alternate arbitrator(s) by filing a stipulation with the
Court within thirty (30) days from the date of entry of this Order of Court;
and,
3.) The decision of the arbitrator(s) shall be final, binding, and conclusive upon
the parties and shall be filed with this Court.
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