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HomeMy WebLinkAbout03-08-11 c~ ~• ~ z ° r~ c v ~- a -n -,, Jeffrey R. Boswell, Esquire ?~ ~ n_ ~ f;` ` ` Supreme Court I.D. #25444 r ~ G r r~ , ~ ,7 ~ BOSWELL, TINTNER & PICCOLA 315 N rth F S ~~ ~ ~ ;', ~ . ~ ~ ~ ~ ront o treet ~ ~ ~ ~;~ Harrisburg, Pennsylvania 17101 ~~. n ~. ,_ Phone(717-236-9377) Z7 -'~ ~+r Fax (717-236-9316) ~ '-'I C+~ °-= ~=j ~ E-mail (iboswellC~btpalaw.com) t~ ~ - rTr C7 , t[` ~ --ry IN RE: ESTATE OF : IN THE COURT OF COMMON PLEAS SARAH McCREA CHAPMAN JONES .:CUMBERLAND COUNTY, PENNSYLVANIA LATE OF LOWER MIFFLIN TWP., :ORPHANS' COURT DIVISION CUMBERLAND COUNTY, PA., . DECEASED. : NO. 21-09-0329 NO. 21-78-0442 PETITION FOR RULE TO SHOW CAUSE AND NOW, come Henry L. Chapman, guardian of Alfred McCrea Chapman, Karen E. Chapman, Katharine Chapman Michalka, and Henry L. Chapman; by and through their attorneys, Jeffrey R. Boswell, Esquire, and Boswell, Tintner & Piccola, and respectfully petition this Honorable Court to issue a Rule to Show Cause upon the Trustees of the Sarah McCrea Chapman Jones Charitable Remainder Trust why the Trustees should not pay all the legitimate, as well as specific court-ordered expenses for the care, maintenance, and support of Alfred M. Chapman, and in support thereof, aver, as follows: 1. Sarah McCrea Chapman Jones ("Decedent") died on July 28, 1978. 2. The Register of Wills admitted to probate the Last Will and Testament of the Decedent, dated September 8, 1976 ("Will"), a copy of which Will is attached and incorporated as Exhibit "A." ~~ 3. Decedent, by her Will, established numerous trusts. 4. Decedent, in her Will, paragraph NINETEENTH, devised "Chapman Lodge and its contents, together with the land adjacent thereto" to Farmers Trust Company and John McCrea, III, in trust ("Chapman Lodge Trust"). 5. According to paragraph NINETEENTH of Decedent's Will, the Chapman Lodge was to be held in trust for the benefit of Decedent's son, Alfred McCrea Chapman, for "as long as he lives or as long as he has any need for it." 6. The said Alfred McCrea Chapman has three children, namely Karen E. Chapman, Katharine Chapman Michalka, and Henry L. Chapman. 7. According to paragraph NINETEENTH of Decedent's Will, the Chapman Lodge land adjacent thereto would be held for the use and benefit of the children of Alfred McCrea Chapman, John McCrea, and Katharine Jane McCrea Morris, until the youngest child of Alfred McCrea Chapman reached the age of twenty-one, at which time the Chapman Lodge would be conveyed to Alfred McCrea Chapman's children, as joint life tenants. 8. Decedent, in paragraph TWENTIETH of her Will, bequeathed $35,000.00 to the said Trustees in trust for the maintenance and upkeep of the "Chapman Lodge and its adjacent acreage," during the term of the Chapman Lodge trust. Manufacturers and Traders Trust Company ("M&T") is the successor to Farmers Trust Company, the named Trustee. 9. Farmers Trust Company and then M8~T administered the Chapman Lodge Trust paying for various expenses, including maintenance, utilities, taxes, and insurance for the Chapman Lodge and its adjacent land. 10. M&T, in its Petition filed on April 8, 2009, alleged that current annual fixed expenses, including utilities, tax, and insurance, for the Chapman Lodge and the adjacent land, is approximately $5,300.00. 11. The Decedent, in paragraph FORTIETH of her Will, provided that 20% of the rest, residue and remainder of her estate, real, personal, or mixed, be given, devised, and bequeathed to Farmers Trust Company and John McCrea, in Trust, to pay out of the income and so much of the principal "... for the care, maintenance and support of my son, Alfred McCrea Chapman, for life." 12. The Decedent, in paragraph FORTIETH of her Witl, gave her Trustees "... the broadest discretionary powers with regard to the distribution of income and principal ..." 13. The Decedent, in paragraph FORTIETH of her Will, also gave her Trustees power to "... convert any and all of the trust assets at either public or private sale and reinvest the same in whatever securities or real estate they in their sole discretion, deem advantageous to the trust..." 14. The Decedent, in paragraph FORTY-FIRST of her Will, provided that "All the rest, residue and remainder of my estate, be it real, personal or mixed, I give, devise and bequeath to Farmers Trust Company and John McCrea III in Trust and confidence. This Trust shall be known as the "Charitable Remainder Trust..." 15. The Decedent, in her First Codicil to Last Will and Testament of Sarah McCrea Chapman Jones ("First Codicil"), in paragraph FOURTH, revoked paragraph FORTY-FIRST of her Will, and in lieu thereof, substituted the following: FORTY-FIRST: All the rest, residue and remainder of my estate, be it real, personal or mixed, I give, devise and bequeath to Farmers Trust Company and John McCrea III in Trust and confidence. This Trust shall be known as the "Charitable Remainder Trust" and the net income, principal thereof shall be disposed of as hereinafter provided: (A) My Trustee shall pay to my son Alfred McCrea Chapman for life, in each taxable year of the trust, in such installments as may be convenient, but not less often than annually a sum equal to five percent of the net fair market value of the trust assets determined annually. On my son Alfred's death, my Trustees shall transfer the then principal of the trust (including all accumulated income) in the following proportions: (1) To Dickinson College, one-tenth (1/10) for the same purposes and on the same conditions set forth in Paragraph Thirty-eight. (2) To Brown University, three-tenths (3/10) for the same purposes and on the same conditions set forth in Paragraph Twenty-First. (3) To The National Trust for Scotland, one-tenth (1/10) for the same purposes and on the same conditions set forth. (4) To the Episcopal Diocese of Central Pennsylvania, three-tenths (3/10) for the same purposes and on the same conditions set forth in Paragraph Thirty-fourth. (5) To the Dickinson School of Law, Carlisle, Pennsylvania, two- tenths (2/10) for the same purposes and on the same conditions set forth in Paragraph Thirty-ninth. (B) In case the net fair market value of the assets of this trust is incorrectly determined, my trustees shall pay to my son Alfred, in case of any undervaluation, or be repaid by him, in the case of any overvaluation, an amount equal to the difference between the amount which my trustees should have paid if the correct value were used and the amount which my trustees actually paid within a reasonable period after the final determination of such value. (E) This trust is intended to qualify as a charitable remainder unitrust as defined in Section 664(d) (1) and to be administered so that the trust shall qualify for the tax exemption provided under that section of the Internal Revenue Code. (F) My Trustee shall not engage in any act of self dealing as defined in Section 4941(d) of the Internal Revenue Code of 1954, or corresponding provisions of any subsequent Federal tax laws, and shall not make any taxable expenditures as defined in Section 4945(d) of the Internal Revenue Code of 1954, or corresponding provisions of any subsequent Federal tax laws. After the death of my son Alfred and until the actual termination of this trust, my Trustees shall not retain any excess business holdings as defined in Section 4943 (c) of the Internal Revenue Code of 1954, or corresponding provisions of any subsequent Federal tax laws; shall not make any investments in such manner as to subject the trust to tax under Section 4944 of the Internal Revenue Code of 1954, or corresponding provisions of any subsequent Federal tax law; and shall distribute income and if necessary principal, at such time and in such manner as may be required so that the trust shall not become subject to the tax on undistributed income imposed by Section 4942 of the Internal Revenue Code of 1954, or corresponding provisions of any subsequent Federal tax laws. The purpose of this paragraph (6) is to comply with the provisions of Section 508(e) of the Internal Revenue Code, to the extent applicable to this trust. The First Codicil is attached and incorporated as Exhibit "B." 16. The Decedent, in paragraph FORTY-FOURTH of her Will, provided "In the event my estate shall be insufficient to pay in full all my specific bequests, then, in that event, my bequests set forth in paragraphs TWENTY-FIRST through THIRTY-NINTH, inclusive, which are to charitable, historical and educational institutions shall abate first." The Decedent, in paragraph FORTY-FOURTH of her Will, also provided "In the event there are not sufficient funds in my estate to pay such charitable, historical and educational bequests in part, then, said bequests shall share proportionately." 17. M8~T filed a First and Partial Account for the Chapman Lodge Trust for the period from November 2, 1978, to May 27, 2009, on May 27, 2009. 18. The Petitioners believe that Alfred McCrea Chapman has not visited Chapman Lodge and its adjacent land since his mother's death. Since Decedent's death, the Trustees of the Chapman Lodge Trust, including John McCrea, III, have exhausted the monetary assets and any income earned by the trust. These Trustees did pay real estate taxes for 2003, 2004, and 2005, totaling $9,157.52. During this period through 2005, the Chapman Lodge and its adjacent land was used almost exclusively by John McCrea, III, and his family. Petitioner Henry L. Chapman believes he visited the Chapman Lodge two or three times in 2003. 19. The Decedent, by paragraph SECOND of her First Codicil, revoked paragraph FIFTH of her Will and in lieu thereof substituted a new paragraph FIFTH increasing the specific cash bequests to John McCrea, III, to his sisters, Margaret Catherine McCrea Blaze, Jean Shannon McCrea Heckman, and Rebecca Sleichter McCrea Smith, and to his first cousins, John E. Morris, III, and Jane McCrea Morris, each bequest, from $10,000.00 to $20,000.00, effectively reducing the Decedent's residuary estate and the initial principal of the Charitable Remainder Trust by a total of $120,000.00. 20. The Decedent's Will and First Codicil were both dated September 8, 1976, and were both written by the said John McCrea, III, who, according to the Last Will and the First Codicil, was named a Trustee and a Beneficiary. The Codicil was witnessed by the said John McCrea, III. 21. George L. Ebener, Realtor, established the fair market value of Chapman Lodge and its adjacent land, by his letter dated February 11, 1988, a copy of which is attached and incorporated as Exhibit "C." 22. The termination of the Chapman Lodge Trust was entertained by the predecessor Trustee, Farmers Trust, as noted in the April 11, 1986, letter of Dennis C. Caverly, Executive Vice President and Trust Officer, Farmers Trust, addressed to Mrs. Kate Michalka, referencing Decedent's Will, paragraph NINETEENTH, and transfer to the life tenants, including Mrs. Michalka's brother (Henry) and sister (Karen), which letter is attached and incorporated as Exhibit "D." 23. In her letter dated August 7, 1989, addressed to Ms. Jane F. Burke, Vice President and Trust Officer, Farmers Trust, the said Henry L. Chapman addressed the deteriorating condition of Chapman Lodge, as well as "... a number of surreptitious intrusions by unidentified persons who have been able to bypass the security system each time" and he questioned if anything is being done to prevent these entries to protect the property at Chapman Lodge, which letter is attached and incorporated as Exhibit "E." 24. The Trustees of the Chapman Lodge Trust recorded expenses for utilities, insurance, real estate taxes, and maintenance for the period from 1978 to 1987 totaling $30,841.00, as more fully set forth in Exhibit "F." 25. The Trustees, including John McCrea, III, have diverted assets, including principal and income of the Charitable Remainder Trust, to the Chapman Lodge Trust contrary to the directive against self-dealing, specifically as set forth in the trust language (FORTY-FIRST (F)), as stated in paragraph 15. 26. The Trustees have failed to charge John McCrea, III, for his use of the Chapman Lodge and its adjacent land even though the Trustees, including John McCrea, III, had knowledge that the Chapman Lodge Trust had insufficient principal and income to pay for maintenance, utilities, real estate taxes, and insurance. 27. The Trustees, including John McCrea, III, have failed to preserve the principal and income, failed to obtain payment for use, and then, did not maintain the Chapman Lodge and its adjacent land, thereby "wasting" the trust principal to the ultimate detriment of Alfred McCrea Chapman. 28. The said John McCrea, III, addressed a letter dated April 24, 2009, to Henry L. Chapman, Karen E. Chapman, and Katharine Michalka, proposing that they transfer their life estate interest to him, which letter is attached and incorporated as Exhibit "G." 29. The Trustees of the Chapman Lodge Trust have insufficient funds to continue to pay for utilities, maintenance, and real estate taxes unless income can be generated from the property. Thus, land is subject to sale for nonpayment of delinquent taxes in July, 2011. 30. The Executor of the Estate of Sarah McCrea Chapman Jones prepared a First and Final Account, dated December 13, 1985, which account was never filed and, therefore, was never confirmed. 31. The Executors of said Estate also prepared a Schedule of Proposed Distribution in December, 1985. 32. The current Trustee of the Charitable Remainder Trust filed a First and Partial Account, dated December 22, 2009, listing first receipt of funds on October 16, 1985, to November 12, 2009, with no accounting for the funds from Decedent's date of death to its first receipt of funds on October 16, 1985. 33. The said Alfred McCrea Chapman receives a distribution, quarterly, from the Charitable Remainder Trust calculated at the rate of 5% of the market value on December 31 of the preceding year. 34. Because of the Trustee's actions and non-actions concerning the Charitable Remainder Trust's investments, the Charitable Remainder Trust suffered a loss in market value, so the distributions as calculated on the market value were reduced, resulting in Alfred M. Chapman's being unable to pay his hospital and other proper bills as due. 35. Alfred M. Chapman's usual, legitimate, and recurring expenses have also increased making it impossible to pay same without additional payments from the principal of the Credit Remainder Trust, which had a market value of $1,146,857.43, on December 31, 2010. 36. Jane F. Burke, Vice President of M&T, in her letter dated January 12, 2011, explained to Alfred Chapman, c/o Henry L. Chapman, Guardian, the calculated distributions for 2011 to be made to Alfred Chapman, as follows: The December 31 market value of the trust was $1,146,857.43. Your 5% unitrust payment for 2011 is $57,342.88. Quarterly distributions will be made in the amount of $14,335.72. This January 12, 2011, letter is attached and incorporated as Exhibit "H." 37. The said Alfred McCrea Chapman is a patient at Friends Hospital. The Friends Hospital invoice (received February 7, 2011) for unpaid charges from May 1, 2010, through February 28, 2011, lists a total due of $59,814.40, which invoice is attached and incorporated as Exhibit "I." 38. As of February 12, 2011, the said Alfred M. Chapman has bills outstanding and unpaid, in the amount of $75,894.63, as set forth in the Summary of Unpaid Bills and Current Deficit as of January 16, 2011, which is attached and incorporated as Exhibit "J." 39. The said Alfred M. Chapman will incur additional charges from Friends Hospital for hospital charges, prescription medication, and other obligations for 2010 and 2011, the total of which are projected to be a negative $106,457.09, including 2011 distributions from the Charitable Remainder Trust, as per Trustee information in Exhibit "H," as set forth in the 2010-2011 Friends Hospital charges and payments applied - projected to 2011 Year-end-Deficit summary, which is attached and incorporated as Exhibit "K." 40. This projected 2011 Year-end-Deficit summary lists the application of social security payments to the Friends Hospital charges, which monthly social security payments of $1,313, less the $400 Medicare premium, are the said Alfred M. Chapman's only other source of income, besides payments from the Charitable Remainder Trust. 41. The Decedent's expressed intent to provide for the care, maintenance, and support of her son for his life cannot be accomplished given the current circumstances, the structure of the Charitable Remainder Trust limiting distributions to the said Alfred M. Chapman to 5% of the market value, the Charitable Remainder Trust's lesser value, and the increased expenses for Alfred M. Chapman's necessary medical care, maintenance, and support. WHEREFORE, your Petitioners respectfully request this Honorable Court to issue a Rule to Show Cause upon the Trustees of the Sarah McCrea Chapman Jones Charitable Remainder Trust why the said Trustees should not pay all the legitimate expenses, as well as specific court-ordered expenses of the Guardian of Alfred M. Chapman, for the necessary care, maintenance, and support of Alfred M. Chapman, and, thereafter, to direct the said Trustees of said Charitable Remainder Trust to make additional payments from principal, as necessary, in addition to the calculated distributions based on year-end market value, for the necessary care, maintenance, and support of the said Alfred McCrea Chapman for his lifetime, consistent with the expressed intent of Sarah McCrea Chapman Jones. Respectfully submitted, BOSWELL, TINTNER & PICCOLA By: J R. Boswell, Esquire I.D. No. 25444 315 N. Front Street Harrisburg, PA 17101 (717) 236-9377 Attorneys for Henry L. Chapman, Guardian of Alfred McCrea Chapman, Henry L. Chapman, Karen E. Chapman, and Katharine Chapman (n/k/a Katharine Chapman Michalka) DATED: March 7,.2011 c~~~r LAST WILL AND TESTAMENT OF SARAH MC CREA CKAPMAN JONES I, Sarah McCrea Chapman Jones, a resident of Lo*.~er Mifflin Township, Cumberland County, Pennsylvania, .do make, publish and .declare this to ~e my Last Will and Testament and do hereby revoke. and cancel all Wills and Codicils heretofore made by me. FIRST: I direct that all my ,just debts and funeral expenses be paid by my Executors, hereinafter named, as soon after my death as may be .convenient. SECOND: I direct that all legacy, inheritance, succession, transfer and estate taxes levied or lawfully assessed-upon or -with respect to any property or any interest in property, legal l or equitable, which is included as part of my gross estate for 1 the purpose of any such tax, shall be paid by my Executors out of my estate in the same manner as an expense of administration and shall not- be pro-rated or apportioned among or charged against the respective devisees, legatees, beneficiaries, transferees or other recipients of any such property, nor charged against my property passing or which may have passed to them or any of them, other than such property that ca~uld otherwise constitute a part of my residuary estate, and that V my Executors shall not be entitled to contribution or reim- bursement for any portion of any such tax from any such person, any statute or rile of law to the contrary notwithstanding. THIRD: I give, devise and bequeath rive Thousand ($5,000.00) Dollars to the Farmers Trust Company and John McCrea III, in trust nevertheless, to pay the-net income therefrom to Elizabeth Norcross McCrea during her life and upon her 'death to treat the principal of said trust as other residue of the estate page one of 12 pages EXHIBIT FOURTH: I give, devise and bequeath Twenty Thousand ($20,000.00) Dollars to the Farmers Trust Company and John McCrea III, in trust nevertheless, to pay the net income there- from and so much of the principal as they, in their sole discretion, deem .necessary Por the care, maintenance and support of Katherine Jane McCrea Morris, for life, and thereafter, to pay, upon the same terms, to her husband, John Morris, Jr., for his life, if she should predecease him. Upon termination of this trust, .:.he residue therefrom is to be paid to the then surviving children of Katherine Jane McCrea Morris, in equal shares, and, if there are at that event no surviving children, then the residue of said trust is to be treated as other residue of this estate. FIFTH: I give, devise and bequeath Ten Thousand ($10,000.00) Dollars to each of the following persons: John E. Morris III, Jane McCrea Morris, Margaret Catherine McCrea Blaze, Jean Shannon McCrea Heckman, Rebecca Sleichter McCrea Smith, and John McCrea III, Members of the fsmily who are not mentioned ,in this. instrument have received gifts during my lifetime, SIXTH: I give, devise and bequeath One Thousand ($1,000.00) Dollars to each of the children of the persons named in paragraph FIFTH of this instrument. SEVENTH: I cancel the note and loan of $800.00 secured ~ thereby which was made in 1938 to John McCrea and W,H. McCrea, Jr., at the time of their purchase of the Old Stone Huntaberger Hotel in Newville, Pennsylvania, plus any interest due therefrom. EIGHTH: I give, devise and bequeath my inheritance from my Mothers estate (deceased 1961) to the children of John McCrea, share and share alike. NINTH: I give, devise and bequeath One Thousand ($1,000.00) Dollars to Miss Dora David, formerly President of Sarah Tucker College, India. page two of ~2 pages TENTH: I give, devise and bequeath One Thousand ($1,000.00) Dollars to Doctor Anna Zachariah, formerly President of Madras Women~s Christain College, Indfa. ELEVENTH: I give, devise and bequeath One Thousand ($1,000.00) Dollars to Mark Heberlig and Margaret Heberlig, or the survivor of them, TWELFTH: I give, devise and bequeath One Thousand ($1,000.00) Dollars to Fred Heckman. THIRTEENTH: I give, devise and bequeath One Thousand ($1,000.00) Dollars to Alberta Boldosser. FOURTEENTH: I give, devise and bequeath One Thousand ($1,000.00) Dollars to my niece, Hazel M. Chapman. ' FIFTEENTH: I give, devise and bequeath One Thousand ($1,000.00) Dollars to The Reverend Doctor Ronald Wiley and Alberta Wiley, his wife, or the survivor of them. SIXTEENTH: I give, devise and bequeath to my grandson, Henry Lewis Chapman, the Chapman Grandfathers Clock, Chapman large carved oak cabinet, Goddard-type desk, all now located in Chapman Lodge, and one of my silver services. SEVENTEENTH: I give, devise and bequeath to my granddaughter, Katherine Stacy Chapman, the Powell Grandfathers Clock, now located in the home of Alfred M. Chapman, Ardmore, Pennsylvania, and ane of my silver services. e EIGHTEENTH: I give, devise and bequeath to my granddaughter, Karen Elizabeth Chapman, the Grandfathers Clock, now located I at Ziegler~s Storage Warehouse, the antique walnut tiptop table, which was a wedding gift from my parents, and one of my silver services NINETEENTH: I give, devise and bequeath to the Farmers ~- Trust Company and John McCrea III, in trust nevertheless, my country house known as Chapman Lodge and its contents, together page three of Sit pages with the land adjacent thereto, Lower Mifflin Township, Cumber- land County, Pennsylvania, containing 19 acres, more or less, for r the benefit and use of my son, Alfred McCrea Chapman, as long as he lives or as long as he has any need for it. At his death i or whenever the benefit to him ends, then my Trustees herein shall continue to hold the property for the use and benefit of ' the children of Alfred McCrea Chapman, and for the use and benefit of the children of John McCrea and the children of Katherine Jane McCrea Morris, until the youngest child of Alfred McCrea Chapman reaches the age of Twenty-one years, at which time my Trustees are to convey said property for life to the children of Alfred McCrea Chapman, as joint life tenants. At the termination of the life estates, or after renunciation I thereof, or if there are no children of Alfred McCrea Chapman living at the termination of this trust, then said property shall pass in remainder to St.Johns Episcopal Church, Carlisle, Pennsylvania. TWENTIETH: I give, devise and bequeath to the Farmers Trust Company and John McCrea III, Thirty-five Thousand ($35,000.00) Dollars, in trust nevertheless, to use the income and so much of the principal as they in the ix discretion deem necessary for the upkeep, maintenance, repair, and taxes of Chapman Lodge and V its adjacent acreage, during the term of the trust- created in paragraph NINETEENTH, When that trust terminates, then the residue of this trust shall be treated as other residue of this. estate. ~. TWENTY-FIRST: I give, devise and bequeath to Brown University Ten Thousand ($10,000.00) Dollars, to expend the income therefrom for scholarships and to be known as the Alfred McCrea Chapman scholarships. TWENTY-SECOND: I give, devise and bequeath to Lawrenceville i School, Lawrenceville, New Jersey, Five Thousand ($5,000.00) page four of pages Dollars, to expend the income therefrom for scholarships, and to be known as the Alfred McCrea Chapman scholarships. TWENTY-THIRD: I give, devise and bequeath to St. Thomas Episcopal Choir School, West Fifty-fifth Street, New York City, Five Thousand ($5,000,00) Dollars, to expend the income there- from for scholarships and to be known as the Alfred McCrea Chapman scholarships. TWENTY-FOURTH: I give, devise and bequeath to St. Lukes Episcopal Church, Newton, Bucks County, :'ennsylvania, Five Thousand ($5,000.00) Dollars, to expend the income therefrom for general church purposes and to be known as the Alfred Madison Chapman Fund. TWENTY-FIFTH: I give, devise and bequeath to the Trinity Episcopal Church, Wilmington, Delaware, One Thousand ($1,000.00) Dollars to expend the income therefrom for flowers during the month of January in memory of Joseph Holton Jones. TWENTY-SIXTH: I give, devise and bequeath to the Domestic and Foreign Missionary Society of the Episcopal Church at 815 Second Avenue, New York City, for the benefit of the Sarah Tucker College of Palayamkottai, Madra State, South India, One Thousand ($1,000.00) Dollars, ~ TWENTY-SEVENTH: I give, devise and bequeath to the National Trust of Scotland One Thousand ($1,000,00) Dollars, to pay the income therefrom for the upkeep and maintenance of the Kintail Trust Property and to be known as the Sarah McIlvaine McCrea Jones Fund. TWENTY-EIGHTH: I give, devise and bequeath One Thousand ($1,000,00) Dollars to the Directors of the John Graham Library Association, Newville, Pennsylvania, and to be known as the Sarah McCrea Chapman Jones Fund. TWENTY-NINTH: I give, devise and bequeath One. Thousand ($1,000,00) Dollars to the Hamilton Library and Cumberland page five of 12 pages County Historical Association, Carlisle, Pennsylvania, for general purposes, to be known as the John McCrea Fund. THIRTIETH: I give, devise and bequeath to St. Johns Episcopal Church, Carlisle, Pennsylvania, One Thousand ($1.,000.00) i Dollars. THIRTY-FIRST: I give, devise and bequeath to the First United Presbyterian Church; Newville, Pennsylvania, One Thousand ($1,000.00) Dollars. THIRTY-SECOND: I give, devise and bequeath to the Holy Trinity Episcopal Church, Philadelphia, Pennsylvania, One Thousand ($1,000.00) Dollars. THIRTY-THIRD: I give, devise and bequeath to St. Andrews Episcopal Church, Yardley, Pennsylvania, One Thousand ($1,000.00) I Dollars. THIRTY-FOURTH: I give, devise and bequeath *_o the Episcopal Diocese of Central Pennsylvania Five Thousand ($5,000.00) Dollars for the Endowment Fund, to be known as the Sarah McCrea Chapman Jones Fund. THIRTY-FIFTH: I give, devise and bequeath to Villore Medical College and Hospital in India One Thousand ($1,000.00) Dollars. e THIRTY-SIXTH: I give, devise and bequeath to Nepal Hospital Fund, Kathmandu, One Thousand ($1,000.00) Dollars. THIRTY-SEVENTH: I give, devise and bequeath to the Episcopal Home for the Aged, Shippensburg, Pennsylvania, One Thousand ($1,000.00) Dollars. THIRTY-EIGHTH: I give, devise and bequeath to Dickinson College, Carlisle, Pennsylvania, Five Thousand ($5,000.00) Dollars, to expend the income therefrom for scholarships and to be known as the Barbara Snyder McCrea scholarships. page six of 12 pages THIRTY-NINTH: I give, devise and bequeath to the Dickinson School of Law, Carlisle, Pennsylvania, One Thousand ($1,000.00) Dollars. FORTIETH: Twenty per cent (207.) of the rest, residue and remainder of my estate, be it real, personal or mixed, I give, devise and bequeath to the Farmers Trust Company and John McCrea III, in trust nevertheless, to pay out of the income and so much of the principal as they, in their sole and absolute discretion, deem necessary, for the care, maintenance and support of my son, Alfred McCrea Chapman, forlife, and, in addition, to pay out of the income and so much of the principal as their absolute dis- cretion deems necessary, for the care, maintenance, support and education (secondary, college, and graduate) of the children of Alfred McCrea Chapman, until all the children have either attained the age of twenty-one years, or completed their education, which- ever later occurs. My trustees are to have the broadest discretionary powers with regard to the distribution of income and principal without need for equality of amount between or among beneficiaries and without recognition of intestacy proportions. My trustees may convert any and all of the trust assets at either public or private c, sale and reinvest the same in whatever securities or real estate ~ they in their sole discretion, deem advantageous to the trust. Said investments may include the stock of the Farmers Trust Company. Upon the termination of this trust I give, devise and be- queath to each of my grandchildren, Henry Lewis Chapman, Katherine Stacy Chapman, and Karen Elizabeth Chapman, one third of the then balance. If any or all grandchildren are deceased at the payment -_.~-t of this bequest, and leave issue them surviving, then each page seven of 12 pages deceased grandchild's share is to be paid to his issue, share and share alike. If any deceased grandchild does not leave issue .him or her surviving, then his or her share is to be paid to my grandchildren who survive him or her, or their issue,the grandchildren to take equal shares, and the issue to take, per •stirpes, the share their deceased parent would have taken had he or she survived. If no grandchildren, and no issue of grand- children, survive at the time of the payment of this bequeath, then it shall b~ treated as part of the residue of this estate. FORTY-FIRST: All the rest, residue and remainder of my r estate, be it real, personal or mixed, I give, devise and be- `~ queath to Farmers Trust Company and John McCrea III in Trust J and confidence, This Trust shall be known as the "Charitable ~_ 1 Remainder Trust" and the net income, principal thereof shall be disposed of as hereinafter provided: (A) My Trustees shall pay to my son Alfred McCrea Chapman for life, in each taxable year of the trust, in such installments as may be convenient, but not less often than annually a sum equal to 5 per cent of the ._. __. net fair market value of the trust assets determined annually, On my son Alfred's death, my Trusteees shall ~~sV~ll transfer the then principal of the trust (including all c -" accumulated income) in the following proportions.:- -- (1) To Dickinson College, three-tenths~~(3/10,/~ /~ ,. for the same purposes and on the same conditfor('s set forth in Paragraph Thirty-eight. (2) To Bro•„m University, three-tenths (3/10)/ for the same purposes and on the same conditions set forth in Paragraph Twenty-First. (3) To The National Trust for Scotland, one-tenth (]/10) for the same purposes and on page eight of i2 pages the same conditions set forth in Paragraph Twenty-Seventh. (4) To the Episcopal Diocese of Central Pennsylvania, three-tenths (3/10) for t'ne same purposes and on the same conditions set forth in Paragraph Thirty-Fourth. (B) In case the net fair market value of the assets of this trust is incorrectly determined, my trustees shall pay to my son Alfred, in case of any undervalua- tion, or be repaid by him, in the case of an overvaluation, an amount equal to the difference between the amount which my trustees should have paid if the correct value were used .and the amount which my trustees actually paid within a reasonable period after the final determination of such value. (C) If my Trustees accept additional contributions, for purposes of the taxable year in which the additional con- tribution is made and where no valuation date occurs after the time of the contribution in the taxable year when the contribution is made, the additional property shall be valued at Ehe time of the contribution and•the amount described in (1) above computed by multiplying 5: by the sum of the net fair market value of the trust assets e (excluding the additional contribution and any apprecia- tion or earned income attributable thereto) and that pro- portion of the additional contribution plus earned income and appreciation, which the number of days, including the day of transfer, remaining in the taxable year bears to the total number of days in that taxable year. (D) If at -.the time any interest is to be irrevocably transferred to a Charity under (A) above, that Charity is not an organization described in 170 (C) I.R.C., then in lieu of transferring such interest to said Charity my page nine of 12 pages Trustees shall transfer it to an organization described in 170 (C ). (E) This trust is intended to qualify as a charitable remainder unitrust as defined in Section 664(d) (1) and to be administered so that the trust shall qualify for the tax exemption provided under that section of the Internal Revenue Code. (F) My Trustees shall not engage in any act of self dealing as defined in Section 494L(d) of the"Internal Revenue Code of 1954, or corresponding provisions of any subsequent Federal tax laws, and shall not make any taxable expenditures as defined in Section 4945 (d) of the Internal Revenue Code of 1954, or corresponding provisions of any subsequent Federal tax laws, After the death of my son Alfred and until the actual termination of this trust, my Trustees shall not retain any excess business holdings ,as defined in Section 4943(c) of the Internal Revenue Code of 1954, or corresponding provisions of any subsequent Federal tax laws; shall not make any invest- ments in such manner as to subject the trust to tax under Section 4944 of the Internal Revenue Code of 1954, or corre- ~. ~ spbnding provisions of any subsequent Federal tax'Iaws; and ' ~ shall distribute income and if necessary principal, at such time and in such manner as may be required so that the trust shall not become subject to the tax on undistributed income imposed by Section 4942 of the Internal Revenue Code of 1954, or corresponding provisions of any subsequent Federal tax laws. The purpose of this paragraph (6) is to comply with the provisions of Section 508(e) of the Internal Revenue Code, to the extent applicable to this trust. (G) In the case of a taxable year which is for a period of less than 12 months (other than the taxable year in which Alfred dies) the amount to be distributed under (1) above shall be that amount multiplied by a fraction, the page ten of 1? pages numerator of which is the number of days in the tax- able year of the trust and the denominator of which is 365 (366 if February 29th is a day included in the numerator). If no valuation date occurs before the end of the taxable year of the trust, the trust assets shall be valued on the last day of the taxable year of the trust. (H) In the case of the taxable year in which Alfred dies, the amount to be distributed under (1) above shall be that ame~unt multiplied by a frac':ion, the numberator of which is the number of days between the beginning of such taxable year and the end of such period and the denominator of which is 365 (366 if February 29th is a day included in the numerator). If no valuation date occurs before the end of this period, the trust assets shall be valued on the last day of such period. FORTY-SECOND: I direct that my grandchildren named as bene- ficiaries of my Last Will and Testament be permitted, insofar as they may unanimously agree, to select in kind from my personal property not specifically devised such items as each .of them ._.. ,. .. may want, with the provision that said items shall be taken at ' ~ '. 'the'ir appaised' Value 'an,d.'charg@d aga'in`st" grandchild~s bequest, FORTY-THIRD: I direct that all advancements of money or property made by me in my lifetime to specific legatees, both individual and charitable, and charged or noted by me hereon, or on my books of account or cancelled checks and check registers as such advancements, shall be taken and counted as part of such legacies in this estate under this instrument. FORTY-FOURTH: In the event my estate shall be insufficient to pay in full all my specific bequests, then, in that event, my bequests set forth in paragraphs TWENTY-FIRST through THIRTY-NINTH, inclusive, which are to charitable, historical and educational institutions shall abate first, In the event there are not suffi- cient funds in my estate to pay such charitable, historical and educational page eleven of pages bequests in part, then, said bequests shall share proportionately. FORTY-FIFTH: I nominate the Farmers Trust Company and John McCrea III as the Executors of this my Last Will and Testament. IN WTTNESS 4JHEREOF, I, the said Sarah tdcCrea Chapman Jones, have hereunto set my hand and seal to this my Last Will and Testament, written on twelve sheets of paper,-each of which is signed by me on the bottom margin, this d=day of September, 1976. r'~T aria c red a Chapman nes This instrument was by the Testatrix, Sarah McCrea Chapman Jones, on the date hereof, signed, published and declared by her to be her Last Will and Testament, in our presence, who, at her request, and in her presence and in the presence of each other, we believing her to be of sound and disposing mind and memory have hereunto sub- scribed our names as witnesses. page twelve of 12 pages I a MCCREA 6 OAVIS ArnRN[T[ AT hY Illlrvlll[ [ iMIItf NRRYR! ~IMN~. FIRST CODICIL 7'0 LAST WZLL AND TESTAMENT OF SARAH McCREA CHAPIAN JONES KNOW ALL MEN BY THESE PRESENTS THAT I, SARAH McCREA CHAPMAN JONES, of Lower Mifflin Township, Cumberland County, Pennsylvania, do make, publish and declare this as a Codicil to my Last Will and Testament dated September ~~' 1976. FIRST; I revoke paragraph FOURTEENTH of my said will, as that bequest has been paid during my lifetime. SECOND: I revoke paragraph FIFTH of my said will. In lieu thereof and as paragraph FIFTH I substitute the following: FIFTH: I give, devise and bequeath Twenty Thousand ($20,000.00) Dollars to each of the following persons: John E. Morris, III, Jane McCrea Morris, Margaret Catherine McCrea Blaze, Jean Shannon McCrea Heckman, Rebecca Sleichter McCrea Smith, and John McCrea ~ III. Members of the family who are not mentioned in this instrument received gifts during my lifetime. THIRD: The silver tea service devised to Henry Lewis Chapman in para- graph SIXTEENTH of my Laat Will is the flat tea service, being a service for twelve. The silver tea service devised to Kathryn Stacy Chapman in paragraph SEVENTEENTH of my said will is the service now in the possession of Betty Lou Leedom Chapman. The silver tea service devised to Karen Elizabeth Chapman in paragraph EIGHTEENTH of my said will is the table service for eight having a i lily of the valley pattern. FOURTH: I revoke paragraph FORTY-FIRST of my said will. In lieu thereof, and as paragraph FORTY-FIRST, Z substitute the following: FORTY-FIRST: All the rest, residue and remainder of my estate, be it real, personal or mixed, I give, devise and bequeath to Farmers Trust Company and John McCrea III in Trust and confidence. This Trust shall be known as the "Charitable Remainder ~ Trust" and the net income, principal thereof shall be disposed of as herein- after provided: (A) My Trustees sha.il pay to my son Alfred McCrea Chapman for life, in each taxable year of the trust, in such installments as may be convenient, but noc less often than annually a sum equal to five percent of the net fair market value of the crust assets determined A .... ..._......... R ... .. _._ ~~ MCCREA i DAVIS AnrNNlr! •r L.lr NC/Ylll[ L LMI//[N!!VN^ IlNN1. annually. On my son Alfred's death, my Trustees shall transfer the then principal of the trust (including all accumulated income) ir. the following proportions: (1) To Dickinson College, one-tenth (1/10) for the same purposes and on the same conditions set forth in Paragraph Thirty-eight. (2) To Brown University, three-tenths (3/10) for the same purposes and on the same conditions set forth in Paragraph Twenty-first. (3) To The National Trust for Scotland, one-tenth (1/10) for the same purposes and on the same conditions set forth in Paragraph Twenty-seventh. (4) To the Episcopal Diocese of Central Pennsylvania, three-tenths (3/10) for the same purposes and on the same conditions set forth in Paragraph Thirty-fourth. (5) To the Dickinson School of Law, Carlisle, Pennsylvania, two-tenths (2/10) for the same purposes and on the same conditions set forth in Paragraph Thirty-ninth. (B) In case the net fair market value of the assets of this trust is incorrectly determined, my trustees shall pay to my son Alfred, in case of any undervaluation, or be repaid by him, in the case of an over- valuation, an amount equal to the difference betwean the amount which my trustees should have paid if the correct value were used and the amount which my trustees actually paid within a reasonable period after the final determination of such value. (C) If my Trustees accept additional contribution;,, for purposes of the taxable year in which the additional contribution is made and where no valuation date occurs after [he time of the contribution in the taxable year when the contribution is made, the additional property shall be valued at the time of the cnntributi.on and the amount described in (1) above computed by multiplying SX by the sum of the net fair market value of the trust assets (exr_luding the additional contribution and any appreciation or earned income attributable thereto) and that pro- -2- MCCFEA i aAVIS AnNNNny •T uw Ntrrill[ L INIP~INL[YNO P[N M4 portion of the additional contribution plus earned income and appreciation which the number of days, including the day of transfer, remaining in the taxable year bears to the total number of days in that taxable year. (U) If at the time any interest is to be irrevocably transferred to a Charity under (A) above, that Charity is nut an organization described in 170 (C) I.R.C., then in lieu of transferring such interest tv said Charity my Trustees shall transfer it to an organization de- scribed in 170 (C). (E) This trust is intended to qualify as a charitable remainder unitrust as defined in Section 664 (d) (1) and to be administered so that the trust shall qualify for the [ax exemption provided uncfer that seccion of the Internal Revenue Code. (F) My Trustees shall not engage in any act of self dealing as defined in Section 4941 (d) of the Internal Revenue Code of 1954, or corresponding provisions of any subsequent Federal tax laws, and shall not make any taxable expenditures as defined in Section 4945 (d) of the Internal Revenue Code of 1954, or corresponding previsions of any sub- sequent Federal tax laws. After the death of my son Alfred and until the actual termination of this trust, my Trustees shall not retain any ~ excess business holdings as defined in Section 4943(c) of the Internal Revenue Code of 1954, or corresponding provisions of any subsequent Federal tax laws; shall not make any investments in such manner as to subject the trust to tax. under Section 4944 of the Internal Revenue Code of 1954, or corresponding provisions of any subsequent Federal tax laws; ~ and shall distribute income and if necessary principal, at such time and in such manner as may be required so that the trust shall oat become subject to the tax on undistributed income imposed by Section 4942 of the Internal Revenue Code. of 1954, or corresponding provisions of any subsequent Federal ta:c laws. The purpose of this paragraph (6) is to comply with [he prvvisions of Section 508(e) of the Internal Revenue i Code, to the extent applicable to this trust. (G) In the case of a taxable year which is for a period of less than 12 months (other than the taxable year in which Alfred dies) the I -3- r amount to be distributed under (1) sbove shall be that amount mail^.iplied by a fraction, the numerator of which is the number of days in the taxable year of the trust and the denominator of which is 365 (366 if February 29th is a day included in the numerator). If no valuation date occurs before the end of the taxable year of the trust, the trust assets shall be valued on the last day of the *_axable year of the trust. (H) In the case of the taxable year in which Alfred dies, the amount to be distributed under (1) sSove shall be that amount mu:~.iplied by a fraction, the numerator of which is the number of days between the beginning of such taxable year and the end of such period and the denominator of which is 365 (3b6 if February 29th is a day included in the numerator). If no valuation date occurs before the end of this period, the trust assets shall be valued on the last day of such period. FIFTH: In all other respects I reaffirm and republish my said will of September - ~~~` 1976. IN WITNESS WHE1tE0F, I have executed this first Codicil to my Last Will and Testament consisting of four (4) typewritten pages by affixing my signature and seal to each page and to the bottom of this last page this ~'~ day of October, 1977. JONES The writing contained on these sheets were signed and sealed by the above-named Sarah McCrea Chapman Jones and by her published and declared as and for a first Codicil to her Las[ Will and Testament dated September 1976, in the presence of us who hereunto subscribed our names as witnesses, at her request, in her presence and in the presence of each other the ', ~- day of October, 1977. "L+- '~ I G ~~2 ~t ~i`yl~ _,~ --- \\//i J McCREA R OAVIS ArtoNN ns tT lnr M[rn[tt i SNVMkHUN[ P[NXA. Office 243-6195 GEORGE L. EBENER AND ASSOCIATES REALTORS APPRAISER-SALES-PROPERTY MANAGEMENT '. ^ .. .` 139 WEST HIGH STREET CARLISLE, PA. 17013 February 11, 1988 ,Dennis Caverly, Executive Vice-President and Trust Officer FARMERS TRUST COMPANY 1 West High Street Carlisle, Pa. 17013 Re: Sara McCrea Chapman Estate Dear Mr. Caverly: I am a licensed Real Estate Broker, licensed by the Commonwealth of Pennsylvania, and have been actively engaged in the real estate business for the past thirty-five years in the Cumberland County area. I am thoroughly familiar with real estate values in the area. ' I recently inspected the property in the Sara McCrea Chapman Estate located ,in Lower Mifflin Township, Cumberland County, Pennsylvania, to determine my opinion of its present day fair market value. The -property is North of L.R. 21082 approximately 1%Z miles East of Route 233 near the Village of McCrea. It is all of the property re- cor-ded i.n the office of the Recorder of Deeds for Cumberland County in DeedBook "T", Vol. 10, Page 144, which contains approximately 20 Acres 35. Perches of wooded land plus an adjacent tract of 2.951 Acres. This property is improved with a beautiful 2%Z story log dwelling with metal roof and is commonly known as the "Chapman Lodge". The main section of the dwelling is 24 X 36 ft. in size with a one-story 16 X 30' extension to the rear. It has front and side porches and a rear porch with patio. The first revel contains a large living room with open beam ceiling and ` log burning stone fireplace; dining room 15 X 16'; kitchen with the floor and fireplace with woodburning stove; a pantry; first floor powder .room with. metal shower stall and large storage closet inside the side entrance.'. An .open stairway leads to the second floor which contains a large master bedroom 14 X 26' with two closets and a large stone fireplace. A large :bedroom 24 X 14' with closet/ plus a smaller bedroom. The two front bedrooms have doors leading to a screened balcony. Also on the second floor is a bathroom with one-piece fiberglas tub and panelled walls. The exterior walls of the rooms are log. The ceilings are wood and the interior partitions are wood. There is a large attic for EXHIBIT i - ~.•, storage and the attic floor is insulated. There is a. partial basement under the dwelling with poured concrete floor and foundation walls. The heating system is oil fired hot water with two -;275 gallon fuel tanks. The electrical service is 60 amp. This property was built in the early 1930's and is in good condition. However, the roof is in need of painting. In addition to the dwelling there is an 18 X 24' two-story frame garage with metal roof. This garage is equipped with an overhead garage door. Above the garage is a large shop or storage area. This building too is an good condition. Also, there is a 14 X 12' one-room log structure with a large stone fireplace. The above described property is being used as a summer residence and is '~ equipped with a security system. In my opinion the present day fair market value is approx. $85,000.00. I..have no interest of any nature whatsoever in this property. This opinion ~~ is given by me voluntarily and without liability on my part. Since y, //~ ~ ~Geor~L.~Ebener, REALTOR® F~-RMERS TRUST April 11, 1935 ~'Irs. Kate Ihichalka 4212 !Jashington Street Downer's Grove, IL 60515 Re: Chapman Lodge Trust Under Will Sarah Jones Dear Kate: We received the $15 application f$e and paid it on i%arch 7, 1986. We also mailed the school check upon receipt of your letter. You will note that I have enclosed a copy of paragraph "nineteenth" of your grandmother's will. This is the paragraph which pertains to the Chapman Lodge Trust. I have underscored several lines in red. I think that theta are two questions raised by this paragraph. The First one is whether or not we can transfer the property to you, your brother and your sister when Koran turns 21. You will note that the language, in referring to your father, says "as long as he has any Head for it". In my mind there is no guarantsa that at some future time your father will not have a Hoed for it. If this is indeed the case it would not be possible to transfer the property to you three. Nowaver, I believe that we cculd petition the court to request that they authorize distribution. This would require some testimony from Alfred's doctor stating that he will need institutional care for the :=msir~dar of his life. Quito honestly, I am not aura ghat any doctor would testify that way. The second question is what happens to the trust if the property is transferred to you as life tenants. I believe that the trust would remain intact and would pay the expanses of the !edge to the extent that it was able. I suppose a case, though, could be made the+_ the trust created under paragraph "nineteenth" terminates when and iF distribution is made to you three grandchildren. If this is the case, the principal of that trust would r"all into the residua and would no longer ba available to support costs at Chapman Lodge. I'm sure that you agree that this would be an undesirable result. Ore West High Street P.Q 1013 (n~Ja~ 3zlZ I Mrs. ~Cata !`1ichalka 2 April 11, 1935 Although future payments of the Lodge expenses probably Will ~ ~ rernain primarily an obligation of the trust, I did loo!< uo ' ¢ last years exaenses for yau. That' era lis,.ad below. Fred Hec!<man 5 524.93 Real Esi;ate Taxes 595.91 . electricity 370.53'` ?lumbing, H3ating and Repairs 273.1D Telephone 199.51 Alarm 273.00 Oil 355.h0~ Insurance ~9?_.07 ~' Miscellaneous 44.40 If you haua any questions, please contact m+~. I think that it might ba a good idea for you and your siblings, as Wall as your mother and step °atho=, to discuss hoW you Would li!<a to approach the Chapnan Lodge questions When sCaren does reach age 21. Uery t,ryfly yours, Dennis C. Cav3rly Executive Uica president and Trust Officer DCC/gka l T Hlltl't;t;N'1'N 1 glV e, oeVl$e dllu VCl{~1C 61.11 vLLC auv...~.au •~.,. ~y.~, ~,..~..~ Dollars to Alberta Boldosser. FOURTEENTH: I give, devise and bequeath One Thousand ($1,000.00) Dollars to my niece, Hazel M. Chapman. FIFTEENTH: I give, devise and bequeath One Thousand ($1,000.00) Dollars to The Reverend Doctor Ronald Wiley and Alberta Wiley, his wife, or the survivor of them. SIXTEENTH: I give, devise and bequeath to my grandson, Henry Lewis Chapman, the Chapman Grandfathers Clock, Chapman large carved oak cabinet, Goddard-type desk, all now located in Chapman Lodge, and one of my silver services. SEVENTEENTH: I give, devise and bequeath to my granddaughter, Katherine Stacy Chapman, the Powell Grandfathers Clock, now located in the home of Alfred M. Chapman, Ardmore, Pennsylvania, and nne of my silver services. EIGHTEENTH: I give, devise and bequeath to my granddaughter, Karen Elizabeth Chapman, the Grandfathers Clock, now located at Ziegler's Storage Warehouse, the antique walnut tiptop table, which was a wedding gift from my parents, and one of my silver services NINETEENTH: I give, devise and bequeath to the. Farmers Trust Company and John McCrea III, in .trust nevertheless, my country house known as Chapman Lodge and its contents, together page three of _Z pages 1..-_. with the land adjacent thereto, Lower Mifflin Township, Cumber- land County, Pennsylvania, containing 19 acres, mere or less, for the benefit and use of my son, Alfred McCrea Chapman, as long as he lives or as long as he has any need for it. At his death or whenever the benefit to him ends, then my Trustees herein shall continue to hold the property for the use and benefit of the children of Alfred McCrea Chapman, and for the use and benefit of the children of John McCrea and the children of Katherine Jane McCrea Morris, until the youngest child of Alfred McCrea Chapman reaches the age of Twenty-one years, at which time my Trustees are to convey said property for life to the_ children of Alfred McCrea Chapman, as joint life tenants. At the termination of the life estates, or after renunciation thereof, or if there are no children of Alfred McCrea Chapman living at the termination of this trust, then said property shall pass in remainder to St.Johns Episcopal Church, Carlisle, Pennsylvania. TWENTIETH: I give, devise and bequeath to the Farmers Trust Company and John McCrea III, Thirty-five Thousand ($35,000.00) Dollars, in trust nevertheless, to use the inc uch of the principal as they in their discretion deem necessary for the upkeep, maintenance, repair, and taxes of Chapman Lodge and its adjacent acreage, during the term of the trust created in __.. paragraph NINETEENTH. When that trust terminates, then the residue of this trust shall be treated as other residue of this estate. TWENTY-FIRST: I give, devise and bequeath to Brown University Ten Thousand ($10,000.00) Dollars, to expend the income therefrom for scholarships and to be known as the Alfred McCrea Chapman scholarships. Ms. Jane F. Burke Vice President and Trust Officer Farmers National Trust Company One West High Street P.O. Box 220 Carlisle, Pennsylvania 17013 August 7, 1989 Dear Ms. Burke: I received your letter dated June 29 regarding my request to have visits to my father and his doctor reimbursed by the trust set up for his care. I respectfully request you to reconsider your decision not to have these expenses reimbursable by the trust. I am interested in visiting with my father and gaining some insight into the nature of his condition, as well as some of my own difficulties. Also, I visited the log house in McCrea, Pennsylvania between July 8 and July I O and would like to share one or two thoughts with you. According to Roy Kessler I have been the only regular visitor over the past two years. However, there have been a number of surreptitious intrusions by unidentified persons who have been able to bypass the security system each time. It seems that regardless of whether the alarm is working or not there will continue to be clandestine activity at the log house. Is anything being done to prevent this, or to protect the property therein? I would also like to comment on the deteriorating state of repair of the log house. It is apparent that minimal effort is being exerted to repair damages. Items of my continuing concern are: 1. Electrical system: Deterioration of wiring and fuse boxes. When was the last inspection done? 2. Crumbling chimney over kitchen area. 3. Pests: Evidence of termite and carpenter ant activity. Last fumigation was performed in July 1987. 4. Driveway erosion due to water run-off. 5. Increasing rankness of the interior, especially during summer months, including deterioration of the carpets, furniture, curtains, utensils and linens. EXHIBIT ..• -2- In the past I have conferred with Mr. Caverly on such matters, but I understand he has moved to another location and is no longer handling this account. Further, if there are any unidentifiable long distance telephone charges from the (717) 776-5979 number, please do not hesitate to bring them to my attention. Any assistance you may be able to provide will be greatly appreciated. Sincerely, Henry L. Chapman I N I I m W W W W N N N N N ~ N o ~„~ ~ ' I ~ ^ ~" ' W N r O m v N r W r r ~ ''~ _. _ .. ._~ . ~ P '.V IT '~ wr. N I' W .-:......ti_ _. _. L~ m r .... r... ~ m _ } Y ~ 2 I! ! i I 2 ~ ~ ~ i I li I -- _.._ -_ c. . _ .. a o ~ ^I o l C ~p n ~ :H 3 ,G ~ r N r til n ~ n~ln 'r = h ,Cj 1~ A n A ~ T~ r ~ 'R .o aX~ ~ A '~ y ~ !~ a ~ k C n ti '~~ i H ~~ ' w a ~ z 2 2 , ~ m o ati.N ~. r? x "~ ~ y Y A ~ ~ I ~C ~ ~ n )d ~ 1~ I I H ~ I~ ;. I C ~ D '. ~ ~ ~~ t M h i '~ a :4 I ~ j ~ ~1'1 h ~ °~~ ~ h~ ~ Ih ~ ~ ~ I h ~ 'a A ~~ j I ~ ih _..y __ _ ~ _ - -_ ---- ~ Y._ ~ I ------ - -~ _~ _ ' ! ~_ I lrt ~ G r ~_ a _. J ''o L r°° ~ W 1!\ \.,. I~ l~..ia .J ~ a~ JS ~ r-- w 1 1 \i 1 1 \ ~ \i~ ~1 ~;\ \; ; 'm _, ~ - ~ I .,.. ~ ~ +-- ` n tv 2 J ~w 4i -t N \ \ =_~ I .^v ~ o~ \ o .p-- w --- ° j~ \ \ II ~ ~ II \ 1 1 t \ 1 \ j~ II ~'3 _ ,_ --- --i-- i-- - ~J H _-= __--- -- - - -- i- I A i ~ V v 1 1 1' 1 ~ 1~ 1 ~~ j l i ' r T _-_~~ ,._-- ---- ~ ~_ _ u .o'w I ~ a~ w a 1_ _ '~ 1 ~~ 1 1 : ; ! ~ - 9 ~ i 1 ~ 1 1 1 I I I- 1 \ i l j j ~'' ~~ i I~ .wu -Nil -:G ~. h ' i -r_ ~a'.t-. ro ~ P_~W ~~ - 0~ __ - W V ~ O ; ~ i .~ ~.D{ '. 1 1 1,\ i\ ; i i 1 ~ 1; 1 i it \ 1 1 1 oQ -=_=--- - I ~ =~__ \ _ - e ~ _ -~ ~ r h dom. D- fK ~- .o ~- ~-1D~ ~__ -~C 1 1. i i i .,. :.. I .-. .. ~ .. I`- 1 --. __~ _ ~ - ,_. r'° o. rot o~1_r ~ iw,~ F } _ h - _:- - - - ' _ 1 - h ~~ ~~ la ~ K 1 N 1 , : \11 , 1 '\ 1 ~ 1 ~ 11 1 1...11 II I~ _.- ! J I .. ..,.. ~ - -_ _ -- i _._.. ___.___ __ ~ N ~ ;.. ^C H ~ N .Iw , y' hr b ~ ry `C tt ~ 2 ~ .J !.~ .. ~ 0`. ~ W J }t .tom ~N iK. i _ `f __ __ 1 1 \ 1 ~ 1 ~ ~ ~ ~ ~ 1 1 1 1 ~ 1 ~ _- _- _. ., N N N ~' 1~\ r Ism w o W G ._ _~ _':--_ -:°.' -_-_ -~ John McCrea, III P.O. Box 341 Newville, PA 17241 Tel. (717) 77t+-6656 e-mail: jnsmccrea3Qcomcast.net April 24, 2009 Henry L. Chapme 355 Lonely Goose~ircle Harleysville, PA 19438 Karen E. Chapman 1858 San Lorenzo Ave. Berkley. CA 94707 Katherine Michalka 250 Loche Lloyd Parkway Belton, MO 64042 RE: Chapman Lodge Dear Cousins: After I wrote my letter to the M&T Bank attorney several days ago, I thought some more about the Chapman Lodge situation. I am still convinced that M&T cannot take away from you a life estate which you have not even received yet. I am equally convinced that, in the currently filed court proceeding, M&T cannot, under any circumstances, take away from you the life estate specifically bequeathed to you in your grandmother's will. The kicker, of course, is that, after you have received your life estate, you would indeed be responsible for paying the Chapman Lodge real estate taxes, insurance, and utilities during the time you held the property as life tenants. I have a proposal. If you would transfer your life estate interests to me, it would enable all of us (except fpr M&T and St. Johns Church) to have our cake and eat it, too. The effect would be two-fold. On the one hand, this transfer would thwart the attempt of the bank managers, who along with the vestrymen of St. Johns Church comprise part of the Carlisle "good old boys" network, to bypass the life estates and transfer Chapman Lodge directly to St. Johns Church. Oa tbe other hand,-this transfer -would continue allowing Chapman Lodge to be used in the same manner it has been used since 1978, by your grandmother's nieces and nephews and their families, and by you should you choose to use it for a weekend or an even longer period of time. You would have no Lodge-related expense (I would be responsible for the annual taxes, insurance premium, and utilities). I would draw up a license agreement between you and myself so that your terms of Lodge use would be legally constituted and binding. I realize that, after a life estate transfer, my property interest in the Lodge would be measured by your lifetimes and that, ul#imately, St. Johns Church would receive the property. But I would continue to pray for your good health and long life. Don't sign anything until you have communicated (phone or a-mail) with me about this proposal. Thaiks. EXHIBIT January 12, 2011 Alfred Chapman c/o Henry L. Chapman, Guardian 355 Lonely Goose Circle Harleysville, P:A 19438 RE: Sarah McCrea Chapman Jones TRU Charitable Remainder Trust Dear Mr. Chapman Private Client Services P.O. BOX 120 ONE WEST RICH STREET CAR1.hSLE, PA 17013 717-240-4504 Toll Free 1-800-822-21.55 We have completed the caluatiou of the Charitable Remainder Unitrust established for your benefit under the Last Will and Testament of Sarah McCrea Chapman Jones. The December 31 market value of the trust was $1,146,857.43. Your 5% mritrust paymeut for 2011 is $57,342.88. Quarterly distributions will be made in the amount of $14,335.72. Early in 2012, the uninttst amount will be recalculated based on the December 31, ZOl 1 market value. A letter informing you of the new amount will be forwarded at that time. If you have any questions, please feel free to contact me. Very truly yours, ,lane F. Burke Vice President Mruurfucturer:c rrnd Trurlers Trust C6mprrny Private Client Serveces EXHIBIT ~ _t~ Friends Hospital 4641 Roosevelt Blvd Attn: Financial Services 1'hiladclphia, PA 19124 Greystone Charges Account 684811 Pat SSN 191-28-6595 Pntient CHAPMAN, ALFRED Guarntr M, AND T Private Client Services David Gority Q M Address 1 West High Street D ~ ~ ~` U CARLISLE PA 17013 ~E6 ~ 2011 Country USA MR# 01-80-12 Phone H/W 215 831-4882 Pat Type .. R GRY Admit 4/16/84 9:00 BY Fin Class .0020 DSC 0/00/00 ,. r.. :.. ., ... :fit".j J:-~ i:, i:; ;..t.,~ ;~.~:I:•,,r # DM Sent . Birth 3/04/19'34- - ,. , ... t.~. .. r.. ,,~`•' . ... t ~.~ .. ~~ i.~.. .)LJi> c.i/, ~. all 2/1/1 1 28 days $5,1.67:40'l~eliriiary'0reyst6`ne=Residential $,:...'360,00 Janciary.Petty Cash Past Due: 1/1/2011 31 days. $5,721.00 Jnnuary Greystone Residential $ 470.00 December Petty Cash 12/1/2010 31 days $5,721,00 December Greystone Residential $ 330.00 November Petty Cash 11/1/2010 30 days $5,507.00 November Greystone Residential $ 370.00 October Petty Cash 10/1/2010 31 days $5,721.00 October Greystone Residential $ 340.00 September Petty Cash 9/1/2010 30 days $5,507.00 September.Greystone Residential $ 440.00 August Petty Cash 8/1/2010 31 days $5,721:p0:August.G.reystone Residential ,: .. :. :' $ ~3:60:00'July-~Pett~~Cd'sh~~ ,:~ ... 7/1/2010 31 days $5,721.00 July Greystone Residential ~,•;~~r ,3 c.~,;{. ~ ~,..~~.;: ~~`..~"'$`.'~T5.00 June Petty Cash ,. 6/1/2010 30 days $ 5,507.00 June Greystone Residential $ 435.00 May Petty Cash 5/1/2010 31 days $5,721.00 May Greystone Residential $ 320.00 April Petty Cash Total Due: $59,814.40 Any questions, please call me at (215) 831-4657 Barb Osinski, Please remit all Future payments lo: *''* I~Ri1';NDS 131.;1-IAVIOItAL I-IGAL.TII 4641 Roosevelt Boulevard Philadelphia, I'A 19124 Attn: Business Department N 0 \ \ ~ ~ \ \ \ \ \ ~ \ I'' \ W \ W \ ~ p ~ ry' W W N N N N N o a N m N p L`' F + F + V r „ N ~ ~ ~ ~ ~ w m ~ ~ ~ ~ ~ ~ N v3 . 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N ~ a 3a '°^ 3 v o n ~~ D o c a~~ S 0 ttt~~~~ ~p~ ry O N O N i VERIFICATION 1, Henry L. Chapman, court-appointed Guardian of Alfred M. Chapman and Contingent Beneficiary of the Testamentary Trust of Sarah McCrea Chapman Jones, hereby verify that the facts contained in the foregoing Petition for Rule to Show Cause are true and con~ect to the best of my knowledge, information, and belief. I understand that fates statements herein are subject to the penalties of 18 Pa.C.S.A. §4904 relating to unswom falsfication to authorities. l.~ Henry L. Chap an DATE: M~4~? CN off, 2 o I 1 VERIFICATION I, Jeffrey R. Boswell, Esquire, being duly sworn according to law, deposes and says that he is the attorney for the Contingent Beneficiaries of the Testamentary Trust of Sarah McCrea Chapman Jones, Katharine Chapman Michalka and Karen E.Chapman, that said Contingent Beneficiaries cannot make the verification to the foregoing Petition for Rule to Show Cause due to time constraints, and that the facts set forth in the foregoing Petition for Rule to Show Cause are true and correct upon his knowledge, information, and belief. I understand that false statements herein are made subject to the penalties of 18 Pa.C.S. § 4904 relating to unsworn falsification to authorities. ~~ J ey R. Boswell, Esquire Dated: March 7, 2011 CERTIFICATE OF SERVICE I do hereby certify that I have served a true and correct copy of the foregoing Petition for Rule to Show Cause by placing same in the United States Mail, first class, postage prepaid, at Harrisburg, Pennsylvania, addressed as follows: No V. Otto, III, Esquire Seth T. Mosebey, Esquire 10 East High Street Carlisle, PA 17013 Attorneys for Manufacturers and Traders Trust Company James D. Flower, Esquire 26 West High Street Carlisle, PA 17013 Attorney for Sf. John's Episcopal Chruch John McCrea, III Post Office Box 341 Newville, PA 17241 Michael T. Foerster, Esquire Charitable Trusts and Organizations Section Office of the Attorney General Commonwealth of Pennsylvania 14~' Floor -Strawberry Square Harrisburg, PA 17120 By: Jeffr .Boswell, Esquire Dated: March 8, 2011