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Home My WebLink About01-0234 / t~.- J/1-3 COMMONWEALTH OF PENNSYLVANIA DEPARTMENT OF REVENUE NOTICE OF DETERMINATION AND ASSESSMENT OF PENNSYLVANIA ESTATE TAX BASED ON FEDERAL ESTATE TAX RETURN S)~ (./' BUREAU OF INDIVIDUAL TAXES INHERITANCE TAX DIVISION DEPT. 280601 HARRISBURG, PA 17128-0601 REY-483 EX AFP <12-00) SUSAN E LEDERER S E LEDERER LAW OFFICE 4811 JONESTOWN RD 226 HBG PA 17109 DATE ESTATE OF DATE OF DEATH FILE NUMBER COUNTY ACN 08-27-2001 THORNHILL 06-03-2000 21 01-0234 CUMBERLAND 201 HOWARD A Amount Remitted MAKE CHECK PAYABLE AND REMIT PAYMENT TO: REGISTER OF WILLS CUMBERLAND CO COURT HOUSE CARLISLE, PA 17013 NOTE: To insure proper credit to your account, submit the upper portion of this form with your tax payment. CUT ALONG THIS LINE ~ RETAIN LOWER PORTION FOR YOUR FILES ~ R-iv=483--EX--AFP--[i2~-OO)-----iEi-No-ficif-oF--DETifRMIiiATlo-N-AiiD-~s:sEssrMENif---------------------------- OF PENNSYLVANIA ESTATE TAX BASED ON FEDERAL ESTATE TAX RETURN ~~ ESTATE OF THORNHILL HOWARD A FILE NO.21 01-0234 ACN 201 DATE 08-27-2001 ESTATE TAX DETERMINATION 1. Credit For State Death Taxes as Verified .00 2. Pennsylvania Inheritance Tax Assessed (Excluding Discount and/or Interest) .00 3. Inheritance Tax Assessed by Other States or Territories of the United, States (Excluding Discount and/or Interest) .00 4. Total Inheritance Tax Assessed .00 5. Pennsylvania Estate Tax Due .00 TAX CREDITS: PAYMENT RECEIPT DISCOUNT (+) AMOUNT PAID DATE NUMBER INTEREST/PEN PAID (-) TOTAL TAX CREDIT .00 BALANCE OF TAX DUE .00 INTEREST AND PEN. .00 TOTAL DUE .00 *IF PAID AFTER THIS DATE, SEE REVERSE SIDE (IF TOTAL DUE IS LESS THAN $1, NO PAYMENT IS REQUIRED FOR CALCULATION OF ADDITIONAL INTEREST. IF TOTAL DUE IS REFLECTED AS A "CREDIT" (CR), YOU MAY BE DUE A REFUND. SEE REVERSE SIDE OF THIS FORM FOR INSTRUCTIONS.) \, / tb -e;;2 / ~ ----3 COMMONWEALTH OF PENNSYLVANIA DEPARTMENT OF REVENUE BUREAU OF INDIVIDUAL TAXES INHERITANCE TAX DIVISION DEPT. 280601 HARRISBURG, PA 17128-0601 NOTICE OF INHERITANCE TAX APPRAISEMENT, ALLOWANCE OR DISALLOWANCE OF DEDUCTIONS AND ASSESSMENT OF TAX SUSAN E LEDERER S E LEDERER LAW OFFICE 4811 JONESTOWN RD 226 HBG PA 17109 DATE ESTATE OF DATE OF DEATH FILE NUMBER COUNTY ACN 08-27-2001 THORNHILL 06-03-2000 21 01-0234 CUMBERLAND 101 * REY-1547 EX AFP <12-00) HOWARD A Amount Remitted MAKE CHECK PAYABLE AND REMIT PAYMENT TO: REGISTER OF WILLS CUMBERLAND CO COURT HOUSE CARLISLE, PA 17013 CUT ALONG THIS LINE ~ RETAIN LOWER PORTION FOR YOUR RECORDS ~ REV=is'4j-EX-AFP-ri"2=oiir-NOTicE--OF-INHERiTANCE-i"-ix-XPPRXisEii'ENT~--ALi-oWANCE-oi----------------- DISALLOWANCE OF DEDUCTIONS AND ASSESSMENT OF TAX ESTATE OF THORNHILL HOWARD A FILE NO. 21 01-0234 ACN 101 DATE 08-27-2001 TAX RETURN WAS: (X) ACCEPTED AS FILED CHANGED RESERVATION CONCERNING FUTURE INTEREST - SEE REVERSE APPRAISED VALUE OF RETURN BASED ON: ORIGINAL RETURN 1. Real Estate (Schedule A) 2. Stocks and Bonds (Schedule B) 3. Closely Held Stock/Partnership Interest (Schedule C) 4. Mortgages/Notes Receivable (Schedule D) 5. Cash/Bank Deposits/Misc. Personal Property (Schedule E) 6. Jointly Owned Property (Schedule F) 7. Transfers (Schedule G) 8. Total Assets (I) (2) (3) (4) (5) (6) (7) .00 .00 .00 .00 .00 .00 787,278.16 (8) APPROVED DEDUCTIONS AND EXEMPTIONS: 9. Funeral Expenses/Adm. Costs/Misc. Expenses (Schedule H) 10. Debts/Mortgage Liabilities/Liens (Schedule I) 11. Total Deductions 12. Net Value of Tax Return 13. Charitable/Governmental Bequests; Non-elected 9113 Trusts (Schedule J) 14. Net Value of Estate Subject to Tax (9) (10) 10,645.20 .00 (Ill (12) (13) (14) NOTE: To insure proper credit to your account, submit the upper portion of this form with your tax payment. 787,278.16 10.641) 20 776,632.96 776,632.96 .00 NOTE: 14, 15 and/or 16, 17, 18 and 19 will returns assessed to date. I~ an assessment was issued previously, lines re~lect ~igures that include the total o~ ALL ASSESSMENT OF TAX: 15. Amount of Line 14 at Spousal 16. Amount of Line 14 taxable at 17. Amount of Line 14 at Sibling 18. Amount of Line 14 taxable at 19. Principal Tax Due TAX CREDITS: .00 X 00 .00 X 06 .00 X 00 = .00 X 15 (9)= rate Lineal/Class A rate rate Collateral/Class B rate (5) (6) (7) (8) .00 .00 .00 .00 .00 PAYMENT RECEIPT DISCOUNT (+) AMOUNT PAID DATE NUMBER INTEREST/PEN PAID (-) TOTAL TAX CREDIT .00 BALANCE OF TAX DUE .00 INTEREST AND PEN,. .00 TOTAL DUE .00 * IF PAID AFTER DATE INDICATED, SEE REVERSE FOR CALCULATION OF ADDITIONAL INTEREST. ( IF TOTAL DUE IS LESS THAN $1, NO'PAYMENT IS REQUIRED. IF TOTAL DUE IS REFLECTED AS A "'CREDIT"' (CR), YOU MAY BE DUE A REFUND. SEE REVERSE SIDE OF THIS FORM FOR INSTRUCTIONS.) REV_1500Ex"'1'-(6-00} ,'~- ~ COMMONWEALTH OF PENNSYLVANIA DEPARTMENT OF REVENUE DEPT. 280601 HARRISBURG, PA 17128-0601 REV -1500 INHERITANCE TAX RETURN RESIDENT DECEDENT I- Z W Cl W () W Cl DECEDENT'S NAME (LAST, FIRST, AND MIDDLE INITIAL) THORNHILL DATE OF DEATH (MM-OD-Year) HOWARD DATE OF BIRTH (MM-Do..Year) A. OFFICIAL USE ONLY /~-2/<../-3 FILE NUMBER ~ i-_..Q -1._ ;{ "3 ~ COUNTY CODE YEAR NUMBER SOCIAL SECURITY NUMBER 074-18-1374 THIS RETURN MUST BE FILED IN DUPliCATE WITH THE REGISTER OF WILLS SOCIAL SECURITY NUMBER w .... ~5tJ) u"'''' wQ.u :coo ,,"'''' ~Q.'" Q. " 06/03/2000 06/23/1924 (IF APPLICABLE) SURVIVING SPOUSE'S NAME (LAST, FIRST, AND MIDDLE INITIAL) THORNHILL AGATHA JANE 03, Remainder Retum {date of death prior to 12-13-S2) [X] 5. Federal Estate Tax Return Required Q.... 8. Total Number of Safe Deposit Boxes o 11. Election to tax under Sec. 9113{A) (AttachSchO) [g] 1. Original Return o 4. Limited Estate o 6. Decedent Died Testate (Attach copy of Will) o 9. Litigation Proceeds Received o 2. Supplemental Return o 4a. Future Interest Compromise (date of death after 12-12-82) o 7. Decedent Maintained a Living Trust (Attach copy oITrus!) o 10. Spousal Poverty CredJt (dateo/death between 12-31.91 and 1-1-95) THIS SECTION MUST BE COMPLETED. AlL CORRESPONDENCE AND CONFIDENtiAl TAXINFORMATION SHOULD BE DIRECTED TO: NAME COMPLETE MAILING ADDRESS SUSAN E. LEDERER 4811 JONESTOWN ROAD FIRM NAME (11 Applicable) LAW OFFICE OF SUSAN E. LEDERER SUITE 226 TELEPHONE NUMBER 717-652-7323 HARRISBURG PA 17109 OFFICIAL USE ONLY ~ .... z w " z o Q. '" W '" '" o o z o ~ ....J :::l l- ii: <( () w 0:: 1. Real Estate (Schedule A) 2. Stocks and Bonds (Schedule B) 3. Closely Held Corporation, Partnership or Sole-Proprietorship 4. Mortgages & Notes Receivable (Schedule D) 5. Cash, Bank Deposits & Miscellaneous Personal Property (Schedule E) 6. Jointly Owned Property (Schedule F) o Separate Billing Requested 7. Inter-Vivos Transfers & Miscellaneous Non-Probate Property (Schedule G or L) 8. Total Gross Assets (total lines 1-7) 9. Funeral Expenses & Administrative Costs (Schedule H) (1) (2) (3) (4) (5) ,.:-- :: (6) 787,278.16 (7) (9) 10. Debts of Decedent, Mortgage Liabilities, & Liens (Schedule I) (10) 11. Total Deductions (total lines 9 & 10) 12. Net Value of Estate (line 8 minus Line 11) 13. Charitable and Governmental Bequests/See 9113 Trusts for which an election to tax has not been made (Schedule J) (8) 787,278.16 10,645.20 (11) (12) (13) 10,645.20 776,632.96 776,632.96 14. Net Value Subject to Tax (line 12 minus line 13) SEE INSTRUCTIONS ON REVERSE SlOE FOR APPLICABLE RATES z o ~ I- :::l a. :!: o () g 15. Amount of Line 14 taxable at the spousal tax rate, or transfers under Sec. 9116 (a}(1.2) 19. Tax Due 0.00 X .0 00 (15) XO_ (16) X .12 (17) X .15 (18) (19) (14) 0.00 0.00 0.00 20. 0 CHECK HERE IF YDU ARE REQUESTING A REFUND OF AN OVERPAYMENT > > BE SURE TO ANSWER ALL QUESTIONS ON REVERSE SIDE AND RECHECK MATH < < 16. Amount 01 Une 14 taxable at lineal rate 17. Amount of line 14 taxable at sibling rate 18. Amount of Line 14 taxable at collateral rate ~ Decedent's ComDlete Address: STREET ADDRESS 920 FORBES ROAD . , CITY I STATE -1 ZIP CARLISLE PA 17013 Tax Payments and Credits: 1. Tax Due (Page 1 Line 19) 2. Credits/Payments A. Spousal Poverty Credit B. Prior Payments C. Discount (1) 0.00 Total Credits (A + B +C) (2) 3. InteresUPenalty if applicable D. Inlerest E. Penalty TotallnteresUPenalty (D + E) (3) 4. If Line 2 is greater than Line 1 + Line 3, enter the difference. This is the OVERPAYMENT. Check box on Page I line 20 to request a refund (4) 5. If Line 1 + Line 3 is greater than Line 2, enter the difference. This is the TAX DUE. (5) A. Enter the interest on the tax due. (5A) B. Enter the total of Line 5 + 5A. This is the BALANCE DUE. (58) Make Check Payable to: REGISTER OF WILLS, AGENT 0.00 PLEASE ANSWER THE FOLLOWING QUESTIONS BY PLACING AN "X" IN THE APPROPRIATE BLOCKS 1. Did decedent make a transfer and: Ves No a. retain the use or income of the property transferred: ........................................................................... lKJ 0 b. refain the right fa designate who shall use the property transterred or its income: ........................................ lKJ 0 c. retain a reversionary interest; or ...................................................................................................... 0 [Xl d. receive the promise for life of either payments, benefits or care? ............................................................. 0 lKJ 2. If death occurred after December 12,1982, did decedent transfer property within one year of death without receiving adequate consideration?.................... .................................. ........................................ 0 [ZJ 3. Did decedent own an "in trust for' or payable upon death bank account or security at his or her death? ................. 0 lKJ 4. Did decedent own an individual Retirement Account, annuify, or other non-probate property which contains a beneficiary designation? ........................................................,............................... ............... 0 lKJ IF THE ANSWER TO ANY OF THE ABOVE QUESTIONS IS YES, YOU MUST COMPLETE SCHEDULE G AND FILE IT AS PART OF THE RETURN. Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my krlOwledge and belief, it is true, correct arld complete DeclaraUon of preparer other tharl the personal representative is based on all information of which preparer has any knowledge. SIGNATURE OF PERSON RESPONSIBLE FOR FILING RETURN ((';<;-#tv q-~ /~ ADDRESS P. O. BOX 112 CARLISLE SIGNATU E OF PREPARER OTHER THAN REPRESENTATIVE ~ 4811 JONESTOWN ROAD, SUITE 226 HARRISBURG DATE 01.. 'l..'" c I PA 17013 DATE 2-2./ 01 ADDRESS PA 17109 For dates of death on or after July 1, 1994 and before January 1, 1995, the tax rate imposed on the net value of transfers to or for the use of the surviving spouse is 3% [72 P.S. ~9116 (a) (1.1) (i)). For dates of death on or after January 1, 1995, the lax rate imposed on the net vaiue of transfers to or for the use of the surviving spouse is 0% [72 P.S. ~9116 (a) (1.1) (iI)]. The statute does not exemot a transfer to a surviving spouse from tax, and the statutory requirements for disclosure of assets and filing a tax return are still applicable even if the surviving spouse is the only beneficiary. For dates of death on or atter July 1, 2000: The tax rate imposed on the net value of transfers from a deceased child twenty-one years of age or younger at death to or for the use of a natural parent, an adoptive parent. or a stepparent of the child is 0% [72 P.S. ~9116(a)(1.2)]. The tax rate imposed on the net value of transfers to or for the use 01 the decedent's lineal beneficiaries is 4.5%, except as noted in 72 P.S. ~9116(1.2) [72 P.s. ~9116(a)(1)]. The tax rate imposed on the net value of transfers to or for the use ofthe decedent's siblings is 12% [72 P.S. ~9116(a)(1.3)I. A sibling is defined, under Section 9102, as an individual who has at least one parent in common with the decedent, whether by blood or adoption. 'REV.1510EX+~1.971. ~ . ' , , . COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN RESIDENT DECEDENT SCHEDULE G INTER.VIVOS TRANSFERS & MISC. NON.PROBATE PROPERTY ESTATE OF THORNHILL. FILE NUMBER HOWARD A. This schedule must be completed and filed if the answer to any of questions 1 through 4 on the reverse side of the REV-1500 COVER SHEET is yes. DESCRIPTION OF PROPERTY %OF ITEM INCLlJOETHE NAMEOFTHETRANSFEREE,THEIR RELATIONSHIP TO DECEDENT AND llIEDATEOFTRANSFER. DATE OF DEATH DECD'S EXCLUSION TAXABLE VALUE NUMBER ATTACH A COPY Of THE DEED FOR REAL ESTATE VALUE OF ASSET INTEREST IIFAPPLlCABLEI 1. Charles Schwab, Cash Balance Acct #: 8843-6964, 3,231.42 100. 3,231.42 titled to Howard A. Thornhill a/k/a H. A. Thornhill Living Trust 4. 700 shares AT&T, held in Charles Schwab Acct #: 8843- 25,025.00 100. 25,025.00 6964, titled to Howard A. Thornhill a/k/a H. A. Thornhill Living Trust ($35.75/sh) 5. 2000 shares AOL, held in Charles Schwab Acct #: 8843- 112,156.26 100. 112,156.26 6964, titled to Howard A. Thornhill a/k/a H. A. Thornhill Living Trust ($56.08/sh) 6. 1000 shares AMGEN INC, held in Charles Schwab Acct #: 67,390.63 100. 67,390.63 8843-6964, titled to Howard A. Thornhill a/k/a H. A. Thornhill Living Trust ($67.39/sh) 7. 2000 shares BON-TON STORES INC, held in Charles 4,765.66 100. 4,765.66 Schwab Acct #: 8843-6964, titled to Howard A. Thornhill a/k/a H. A. Thornhill Living Trust ($2.38/sh) 8. 1000 shares DELL COMPUTER, held in Charles Schwab 43,343.75 100. 43,343.75 Acct #: 8843-6964, titled to Howard A. Thornhill a/k/a H. A. Thornhill Living Trust ($43.34/sh) 9. 1050 shares GEN ELECTRIC, held in Charles Schwab Acct # 54,878.91 100. 54,878.91 8843-6964, titled to Howard A. Thornhill a/k/a H. A. Thornhill Living Trust ($52.27/sh) 10. 1000 shares INTEL CORP, held in Charles Schwab Acct #: 133,187.50 100. 133,187.50 8843-6964, titled to Howard A. Thornhill a/k/a H. A. Thornhill Living Trust ($133.19/sh) 11. 1000 shares INTUIT INC, held in Charles Schwab Acct #: 41,281.25 100. 41,281.25 8843-6964, titled to Howard A. Thornhill a/k/a H. A. Thornhill Living Trust ($41.28/sh) 12. 1000 shares MICROSOFT, held in Charles Schwab Accl#: 66,531.25 100. 66,531.25 8843-6964, titled to Howard A. Thornhill a/k/a H. A. Thornhill Living Trust ($66.53/sh) 13. 1000 shares PFIZER INC, held in Charles Schwab Acct #: 43,933.75 100. 43,933.75 8843-6964, titled to Howard A. Thornhill a/k/a H. A. Thornhill Living Trust ($43.84/sh), accrued interest: $90.00 14. 1000 shares SOLECTRON, held in Charles Schwab Acct #: 38,265.63 100. 38,265.63 8843-6964, titled to Howard A. Thornhill a/k/a H. A. Thornhill Living Trust ($38.27/sh) 15. 1500 shares SCHWAB CHARLES CORP NEW, held in 49,007.82 100. 49,007.82 Charles Schwab Acct#: 8843-6964, titled to Howard A. Thornhill a/k/a H. A. Thornhill Living Trust ($32.67/sh) 16 858.893 shares SCHWAB CAP TR FUND, held In Charles 19,642.88 100. 19,642.88 Schwab Acct#: 8843-6964, titled to Howard A. Thornhill a/k/a H. A. Thornhill Living Trust ($22.87/sh) 17. Real Estate located in Curnberland County, PA, 920 Forbes 169,272.90 50. 84,636.45 Street, (.250 acres), ID#: 05-19-1647-046, Deed titled in the name of Howard A. Thornhill a/k/a H. A. Thornhill Living Trust and Agatha Jane Thornhill Living Trust as Tenants in Common, Tax Assessed Value $10,830.00 x 15.63 TOTAL (Also enter on line 7, Recapitulation) $ 787,278.16 (If more space is needed, insert additional sheets of the same size) ,",v""ex."",. COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN RESIDENT DECEDENT SCHEDULE H FUNERAL EXPENSES & ADMINISTRATIVE COSTS ESTATE OF THORNHILL FILE NUMBER HOWARD A Debts of decedent must be reported on Schedule I. ITEM NUMBER DESCRIPTION AMOUNT A FUNERAL EXPENSES: 1. Crowell Brothers 3,565.20 2. Harter Funeral Home 4,530.00 3. Rev. Lt. Col. Patrick Holder 50.00 B. ADMINISTRATIVE COSTS: 1. Personal Representative's Commissions Name of Personal Representative (5) Social Security Numbe~s) I EIN Number of Personal Representative(s) Street Address City State Zip Year(s) Commission Paid: 2. Attorney fees Susan E. Lederer 2,500.00 3. Family Exemption: (If decedent's address is not the same as claimant's, attach explanation) Claimant Street Mdress City State Zip Relationship of Claimant 10 Decedent 4. Probate Fees 5. Accountant's Fees 6. Tax Return Prepar~r's fees 7. TOTAL (Also enler on line 9, Recapilulation) $ 10,645.20 (If more space is needed, insert addilional sheets of Ihe same size) 'REV'15'3EX~(1'97)* . ".' , . COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN RESIDENT DECEDENT SCHEDULE J BENEFICIARIES ESTATE OF THORNHILL FILE NUMBER HC'W ARD A. NUMBER NAME AND ADDRESS DF PERSON(S) RECEIVING PROPERTY 1. TAXABLE DISTRIBUTIONS (include outright spousal distributions) RELATiONSHiP TO DECEDENT Do Not List Trustee(s) AMOUNT OR SHARE DF ESTATE 1. ENTER DOLLAR AMOUNTS FOR DISTRIBUTIONS SHOWN ABOVE ON LINES 15 THROUGH 17, AS APPROPRIATE, ON REV 1500 COVER SHEET II. NON-TAXABLE DISTRIBUTIONS: A. SPOUSAL DISTRIBUTIONS UNDER SECTIDN 9113 FOR WHICH AN ELECTION TO TAX IS NOT BEING MADE 1. Famiiy Trust (credit shelter trust) under Article 9 of the Howard A. Thornhill a/kJa H. A. 776,632.96 Thornhill Living Trust dated July 6, 1999 B CHARITABLE AND GOVERNMENTAL DiSTRiBUTIONS 1. TOTAL OF PART II - ENTER TOTAL NON-TAXABLE DISTRiBUTIONS ON LINE 13 OF REV 1500 COVER SHEET $ (If more space is needed, insert additionai sheets of the same size) 776,632.96 (L6n~) 6 ~SS 3SAN/:::JdIS JeqweV\J 'peAJeseJ S145!J IIV'8uI "o:::J '& qeM48S sepe4:::J 966 ~@ . 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S~nlLIHfl~)~IC~. HVA\Il~)C'1 . U . . . j\ .. U.. U . MetnbersJ FEDERAL CREDIT UNION INSURANCE DEPARTMENT 5000 LOUISE DRIVE P. O. BOX 40 MECHANICSBURG, PA 17055 1-800-283-2328 or(717) 697-1161 REGULAR SAVINGS ACCOUNT: Account Number/Suffix Date Account Opened Principal Balance at Date of Death Accrued Interest to Date of Death Total Principal and Accrued Interest Name of Joint Owner Date J oint Ownership Created 53090 -00 05/0111978 $1,385.23 $,11 $1,385.34 Agatha Jane Thornhill 10/3111991 CHECKING ACCOUNT: Account Number/Suffix Date Account Opened Principal Balance at Date of Death Accrued Interest to Date of Death Total Principal and Accrued Interest Name of Joint Owner Date Joint Ownership Created 53090 -11 07/2511991 $98,00 $.00 $98,00 Agatha Jane Thornhill 10/3111991 REDlT UNION 4'7c4:JC Denise A. Anders Insurance Products Supervisor September 28, 2000 Estate of: HOWARD A. THORNHILL Date of Death: 06/03/2000 Social Security Number: 074-18-1374 ~~ 3'/7- -L ./ibW!#t?.F-d- /0tf?- (Nt DEED 1.-(1.'- This indenture, made the L day Of~, in the year of our Lord one thousand nine hundred and ninety-nine (1999).1 . - (.Q (.Q C-- = r-- ;-.... o c: '.~ "" i'; 1:1 ;' -~ t..-~ _) ;:;oCJ i::::JrTT -C ~~~ ~~ ~ ;;;;:J ;;.; :;) :::0 cON =:3 0"'- ~ c.:: 0 01 o ==fT1~ -I/"TJ ' Howard A. Thorn..1Ull a/k/a H. A. Thornhill and Agatha Jane Thornhill, Trus~s, "( g ~ or their successors in trust under the Howard A. Thornhill aIkIa H. A. Thornhill ..; Living Trust dated July 6, 1999, and any amendments thereto, and Agatha Jane Thornhill and Howard A. Thornhill a/k/ a H. A. Thornhill, Trustees, or their successors in trust, under the Agatha Jane Thornhill Living Trust dated July 6, 1999, and any amendments thereto, as Tenants in Common, Grantees Between Howard A. Thornhill and Agatha Jane Thornhill, husband and wife, of Cumberland County, Pennsylvania, Grantors and Witnesseth, that the Grantors, for and in consideration of the sum of One and NollOO ($1.00) Dollars, lawful money of the United States of America, unto them well and truly paid by the Grantees at or before the sealing and delivery hereof, the receipt whereof is hereby acknowledged, have granted, bargained and sold, released and confirmed, and by these presents do grant, bargain and sell, release and confirm unto the Grantees, their successors and assigns. ALL THAT CERTAIN piece or parcel of land with the improvements thereon erected situate in the Borough of Carlisle, Cumberland County, Pennsylvania, being Lot No.4, Section "E," Plan No.2 of Meeting House Heights, recorded in the Cumberland County Recorder's Office in Plan Book No. 23, at Page 126, more particularly bounded and described as follows: BEGINJ'..'1NG at a point on the South side of Forbes Road on said Plan, which point is located North 76 degrees 9 minutes East, a distance of 315 feet from the Eastern line of Meeting House Springs Road, and which point is also on the dividing line between Lots Nos. 3 and 4, Section "E," of said Plan; thence along the Southern side of Forbes Road North 76 degrees 9 minutes East, a distance of 110 feet to a point on the dividing line between Lots No.4 and 5, Section "E," of said Plan; thence along said dividing line South 13 degrees 51 minutes East, a distance of 96.2 feet to a point on the Southern line of Lot No. II as it appears on the Plan of Burr Heights; thence along the same North 89 degrees 13 minutes 30 seconds West, a distance of32.1 feet to a point on the Northern boundary of the Plan of Burr Heights; thence along said Northern boundary of the Plan of Burr Heights South 69 degrees West, a distance of79.57 feet to a point on the dividing BOO~ 203 r~CE 90S line between Lots Nos. 3 and 4, Section "E," as it appears on Plan 2 of Meeting House Heights; thence along said dividing line North 13 degrees 51 minutes West, a distance of 98.03 feet to a point on the Southern side of Forbes Road, the Place of BEGINNING. BEING improved with a four bedroom brick and aluminum bi-level dwelling known as 920 Forbes Road, Carlisle. BEING the same premises which Lebo, Burkholder & Cleland, a partnership, by Deed dated June 13, 1976, and recorded June 18, 1976, in Deed Book Q-26, Page 415, in the Office of the Recorder of Deeds in and for Cumberland County, Pennsylvania, granted and conveyed unto Howard A. Thornhill and Agatha Jane Thornhill, the Grantors herein. UNDER AND SUBJECT to all restrictions, easements, covenants, conditions and agreements of record. TOGETHER with all and singular the buildings and improvements, ways, streets, alleys, passages, waters, water-courses, rights, liberties, privileges, hereditaments and appurtenances, whatsoever unto the hereby granted premises belonging, or in any Wise appertaining, and the reversions and remainders, rents, issues and profits thereof; and all the estate, right, title interest, property, claim and demand whatsoever of them, the Grantors, as well at law as in equity, of, in and to the same. TO HA VB AND TO HOLD the said lot or piece of ground above described, with the messuage or tenement thereon erected, hereditaments and premises hereby granted, or mentioned and intended so to be, with the appurtenances, unto the Grantees, their successors and assigns, to and for the only proper use and behoof of the Grantees, their successors and assigns, forever. AND the Grantors, for themselves, their heirs, personal representatives and assigns, do covenant, promise and agree, to and with the Grantees, their successors and assigns, by these presents, that they, the Grantors, their heirs, personal representatives and assigns, all and singular the hereditaments and premises hereby granted or mentioned and intended so to be, with the appurtenances, unto the Grantees, their successors and assigns, against them, the Grantors, their heirs, personal representatives and assigns, and against all and every person and persons whomsoever lawfully claiming or to claim the same or any part thereof, by, from or under him, her, them or any of them, shall and will, Subject as aforesaid, WARRANT and forever DEFEND. BOOK 203 PAGE 906 In witness whereof, the Grantors have hereunto set their hands and seals. Dated the day and year first above written. Sealed and Del~vered in(the Presence,of: "\. c ( ~_ \ t.~_V/. l C;-i!'i [J'_;.L~_ [: cD J CL) 10 . ., ti~n^-- t3-{;--~ /~~~ Howard A. Thornhill aIkIa H. A. Thornhill a~.... 8-.. 1~ Agatha Jane Thornhill Certificate of Residence I hereby certify that the precise residence of the Grantees herein is as follows: c/o Howard A. Thornhill aIkIa H. A. Thornhill and Agatha Jane Thornhill, Trustees 920 Forbes Road, Carlisle, P A 17013 ;~'-~c~ ~/ ( Attorney for Grantees -~~/\..... BOO,~ 203 PAGE 907 Acknowledgement COMMONWEALTH OF PENNSYLV ANlA : 55 COUNTY OF DAUPIDN On this JUL 0 6 1999 , before me, a Notary Public in and for the Commonwealth of Pennsylvania, the undersigned officer, personally appeared Howard A. Thornhill alk!a H. A. Thornhill and Agatha Jane Thornhill, husband and wife, known to me (or satisfactorily proven) to be the persons whose names are subscribed to the within instrument and acknowledged that they executed the same for the pwposes therein .;j;- contained. -~- .....' ..:~~( " ;'!!~'\:': ->;;-~ '. IN WITNESS WHEREOF, I hereunto set my hand and official seal. 1~/Y~ Notary Public Notarial Seal ..:,\"-s."'~::"".,"",'_;;..:,,, Linda L. Fetterhoff, Notary P'Jbllc ~, ) Derr; Two.. Dauphin CountY :;-;:--.COMMONWEAL TH OF PENNSYL V ANlA My Comrni5Sicn ",We, Nov. 8. 1999 I ) SS: i''''ieil~J2j" ~'bni~~;i':-'-::::~;' /:,:;::;C[.:i,::');; G;~ COUNTY OF CUMBERLAND ) RECORDED in the Office of the Recorg;r; oiDeeds in and for Cumberland County, in Record Book ,,20-3 , Page :tL j . WI-MS$1 my hand and official seal this / I' V-f-r/'f/1 _~e.u:T j? r~ RECORDER OF DEEDS day of -..<.....,.~ ____-c,t::~,':~~ <- BOOK 203 PAGE 908 The First Amendment to the Howard A. Thornhill aJkJa H. A. Thornhill Living Trust On July 6, 1999, I, Howard A. Thornhill alk/a H. A. Thornhill, signed the Howard A. Thornhill alk/a H. A. Thornhill Living Trust, more formally known as: Howard A. Thornhill alk/a H. A. Thornhill and Agatha Jane Thornhill, Trustees, or their successors in trust, under the Howard A. Thornhill alk/a H. A. Thornhill Living Trust, dated July 6, 1999, and any amendments thereto. Pursuant to Article Four of my Living Trust, which permits me to amend my Living Trust in writing at any time, I now wish to amend my Living Trust as follows: Article Six of my Living Trust is hereby revoked in its entirety and amended as follows: Section 1. Distributions Under Article Six Except for the specific distributions directed in the following Sections of this Article, all distributions of trust property shall be made in accordance with the Articles that follow. Section 2. Income in Respect of a decedent ("IRD") After my death, and after all allocations under Article Seven have been made, my Trustee, in cooperation with the Retirement Account Trustee, shall allocate and distribute, between the Family Trust and the Survivor's trust, all IRD controlled by my Trustee. Such allocation shall be by fractional share. The fraction of the IRD assets to be allocated to the Survivor's trust shall be the fraction thereof necessary to fully utilize the Marital Deduction available to my estate while not preventing the maximum use of my Unused Applicable Credit Equivalent (which fraction, depending on the circumstances, may result in some, all or none of the IRD being allocated to the Survivor's Trust). Any IRD not allocated to the Survivor's Trust shall be allocated to the Family Trust. Section 3. Estate Planning Letter or Memorandum To the extent permitted by state law and not necessary to fully utilize my Unused Applicable Credit Equivalent, my Trustee shall distribute personal or household items from my Trust Estate to such persons as I may direct by a written instrument signed by me and delivered to my Trustee. 1 1_ Section 4. Specific Distribution Not a Part of My Trust Estate If the property making up any specific distribution set forth in this Article is not part of my Tmst Estate at the time such specific distribution is directed to be made and will not become a part of my Tmst Estate within a reasonable time, my Trustee shall disregard that specific distribution. Section 5. Specific Distribution of Trust Property My Tmstee shall make the following specific distributions oftmst property: a. Specific Distributions of Cash to SISTERS OF ST. JOSEPH 1. Primary Beneficiary Upon the death of the second to die of my spouse and me, my Tmstee shall distribute $5,000.00 to SISTERS OF ST. JOSEPH, Motherhouse, 1425 Washington Street, Watertown, New York 13601, free oftmsl. 2. Distribution on Death of Beneficiary "'- If such organization should cease to be in existence prior to the time that this specific distribution is directed to be made, this specific distribution shall lapse and my Tmstee shaIl administer this specific distribution in accordance with the Articles that follow. 3. Apportionment of Expenses and Taxes All expenses, claims, liens, encumbrances and taxes relative to this specific distribution shall be paid by my Tmstee out of the Trust Estate.. b. Specific Distribution of Cash to DEMPSTER GROVE CAMPGROUND ASSOCIATION 1. Primary Beneficiary Upon the death of the second to die of my spouse and me, my Trustee shall distribute $2,000.00 to the DEMSTER GROVE CAMPGROUND ASSOCIATION, Dempster, New York, free oftnlsl. 2 2. Distribution on Death of Beneficiary If such organization should cease to be in existence prior to the time that this specific distribution is directed to be made, this specific distribution shall lapse and my Trustee shall administer this specific distribution in accordance with the Articles that follow. 3. Apportionment of Expenses and Taxes All expenses, claims, liens, encumbrances and taxes relative to this specific distribution shall be paid by my Trustee out of the Trust Estate. c. Specific Distribution of Cash to SISTER KATERI ROSE 1. Primary Beneficiary Upon the death of the second to die of my spouse and me, my Trustee shall distribute $2,000.00 to SISTERKATERI ROSE, to be used for travel expenses. 2. Distribution on Death of Beneficiary If such beneficiary should die prior to the time that this specific distribution is directed to be made, this specific distribution shall lapse and my Trustee shall administer this specific distribution in accordance with the Articles that follow. 3. Apportionment of Expenses and Taxes All expenses, claims, liens, encumbrances and taxes relative to this specific distribution shall be paid by my Trustee out of the Trust Estate. All other articles are hereby ratified and confirmed. I executed this amendment on JUL 2 8 1999 3 I certifY that I have read the foregoing amendment to my Living Trust, and that it correctly states the changes I desire to make in my Living Trust. I approve this amendment to my Living Trust in all particulars, and request my Trustees to execute it. :t:!:J/~~ It a.- .1.t1 Howard A. Thornhill a/kIa H. A. Thornhill, Trustor 1h8-~~ /~O- Howard A. Thornhill a/kIa H. A. Thornhill, Trustee a~.... ~ 7~ Agatha Jane Thornhill, Trustee ACKNOWLEDGEMENT COMMONWEALTH OF PENNSYL VANIA :ss COUNTY OF DAUPHIN The foregoing amendment to the Howard A. Thornhill a/kIa H. A. Thornhill Living Trust was acknowledged before me on JUl 2 8 1999 , by Howard A. Thornhill a/kIa H. A. Thornhill, as Trustor and Trustee, and by Agatha Jane Thornhill, as Trustee. Witness my hand and official seal. My commission expires: ~MUiv ,YJ~~ Notary Public . Notarial Seal. D . Linda L Fetterhoff, Notary , ~bllC Derri TwP.. 9auph:r. :\f?U~.YI999 M Comlllis5\Cn ;::";J\f9;:, . ,e J. .,:_._,.' y .....~......,_.." d1.'c;jti""? M'3!1',~~T. r'.~;':::.:n.;.j.:., 4 , . ......'>.~ ,~:;c'~.~~? . ~.. ORIGINAL This LIVING TRUST prepared for HOWARD A. THORNHILL AlKlA H. A. THORNHILL James, Smith, Durkin & Connelly LLP 134 Sipe Avenue Hummelstown, P A 17036 (717) 533-3280 FAX (717) 533-2795 @ James, Smith, Durkin & Conneny LLP AU Rights Reserved , , .; , . Article One Article Two Article Three ArtiCle Four Article Five Article Six Article Seven Article Ilight Article Nine Article Ten Article meven Article Twelve Artide Thirteen Article Fourteen Article Fifteen HOWARD A. THORNHILL A/KIA H. A. THORNHILL LIVING TRUST Table of Contents Trust Creation ......... . . . . . . . . . . . . . . . . . . . . . . . . . .. 1-1 The Trust Ilstate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 2-1 Appointment of Trustees. . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 3-1 Trustor's Lifetime Rights. ............................ 4-1 Administration at Death of the Trustor ................... 5-1 Specific Distributions of Trust Property . . . . . . . . . . . . . . . . . " 6-1 Division into Survivor's Share and Family Share. ...... . . . . " 7-1 The Survivor's Trust. ............................... 8-1 The Family Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . " 9-1 Common Pot Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10-1 11-1 12-1 13-1 14-1 15-1 Division and Distribution of Trust Property. Distribution If No Designated Beneficiaries. Trustee Administration ............................. Trustee Powers .................................. General Provisions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .-~ ./ " HOWARD A. THORNHILL A/K/A H. A. THORNHILL LIVING TRUST Article One Trust Creation Section 1. Parties to My Trust My Tmst Agreement, dated JUL 061999 ,is made between HOWARD A. THORNHILL AfRJA H. A. THORNHILL, the Tmstor, and the following Initial Tmstees: HOWARD A. THORNHILL AIKIA H. A, THORNHILL AGATHA JANE THORNHILL Section 2. Name of My Trust My Trust may be referred to as the: HOWARD A. THORNHILL AlKJA H. A. THORNHILL LIVING TRUST, dated JUL 0 6 1999 The formal name of my Trust and the designation to be used for the transfer of title to the name of my Trust is: HOWARD A. THORNHILL AlKJA H. A. THORNHILL and AGATHA JANE THORNHILL, Trustees, or their successors in trust, under the HOWARD A. THORNHILL AIKIA H. A. THORNHILL LNING TRUST, dated JUL (I 6 1999 and any amendments thereto. Section 3. Revocable Living Trust My Trust is a revocable trust. 1-1 , J...:' Section 4. Trustor as Trustee Unless otherwise provided in my Trust Agreement, when I am serving as Trustee under my Trust, I may conduct business and act on behalf of my Trust without the consent of any other Trustee. Section 5. My Family Unless specifically provided otherwise in subsequent provisions of my Trust Agreement, all references to "my children", subject to the exclusion of any child under any subsequent provision of this Section 5, are to all of the children so identified in this Section 5, but only to those children and any children born to or adopted by me subsequent to the execution of my Trust Agreement. a. Marital Status I am presently married and the name of my Spouse is AGATHA JANE THORNHILL. b. My Children The names and birth dates of my children are as follows: Name Birth Date CLARE THORNHILL PATRICK THORNHILL March 09, 1953 August 27, 1955 1-2 ./ Article Two The Trust Estate Section 1. Initial Transfer of Property I hereby assign, convey, transfer and deliver to my Trustee all property set forth on Schedule "A", attached hereto, and made part of my Trust Estate. My Trustee acknowledges receipt of all assets listed on the attached Schedule. All assets titled in the name of my Trust or in the name of my Trustee, but not listed on Schedule "A", shall be considered a part of my Trust Estate as if they had been set forth on the attached Schedule. The Trustor acknowledges and understands the nature of the Trustor's property as community property, quasi-community property, tenancy in common property or separate property. Section 2. Additional Transfers to Trust I, or any other person or entity, may transfer or devise to my Trustee additional assets, real or personal, and may name my Trustee as the beneficiary of life insurance policies, annuities, retirement plans or similar contracts. Such assets, policies and proceeds, upon acceptance by my Trustee, shall be a part of my Trust Estate, subject to all the terms of my Trust Agreement. Section 3. Character of Trust Assets All property transferred by me into my Trust shall retain its character. All such property transferred, and income thereon less withdrawals thereof, shall be my Trust Estate. Section 4. Acceptance of Trust Property All property transferred to my Trust, and accepted by my Trustee, shall be held, administered and distributed according to the terms of my Trust Agreement. 2-1 0'0;. :\,p Article Three Appointment of Trustees Section 1. Definition of Trustee All uses of the word "Trustee" in my Trust Agreement shall be deemed a reference to the person or entity then serving as Trustee and shall include alternate or Successor Trustees or Co-Trustees (if multiple trustees are serving), unless the context requires otherwise. Section 2. Resignation of a Trustee Any Trustee may resign at any time without court approval by giving written notice to me if I am living and competent. If I am not then living and competent, written notice shall be given to my next Successor Trustee; or if there is no next Successor Trustee, to the b"lneficiaries then entitled to receive income or principal distribtions under my Trust Agree;nent or their respective Personal Representatives, or if any of such beneficiaries then be a minor, to the persons having the care or custody of any such minor. Such resignation shall be effective upon the appointment of a Successor Trustee. Section 3. Removal of a Trustee Any Tnlstee may be removed under my Trust Agreement as follows: a. While I Am Alive and Competent While I am alive and competent, I may add a Trustee, or remove or replace any other Trustee appointed und~r my Trust Agreement at any time without cause. b. Removal by Others Upon my death or incapacity, any Trustee may be removed at any time for cause by a majority vote of the beneficiaries then entitled to receive income or principal distributions under my Trust Agreement, or their Personal Representatives. 3-1 ./ c. Notice to Removed Trustee Written notice of removal under my Trust Agreement shall be effective immediately when signed by the person or persons authorized to make the removal and delivered to my Trustee personally or three business days after mailing by certified mail, return receipt requested. The written notice removing a Trustee shall identify the Successor Trustee appointed pursuant to the other provisions of this Article. d. Transfer of Trust Property The Trustee so removed shall promptly transfer and deliver to the Successor Trustee all property of my Trust under the removed Trustee's possession and control. Section 4. Designated Successor Trustees Subject to the provisions of Section 3 of this Article, whenever a Trustee is removed, dies, resigns, becomes incapacitated, or is otherwise unable or unwilling to serve, the vacant Trustee position shall be filled as follows: a. Vacancy in Position of Trustee While I Am Alive and Competent I may serve as the only Trustee or I may name any number of Trustees to serve with me. If any of these other Trustees subsequently fails or ceases to serve as a Trustee for any reason, I mayor may not appoint anothel' to fill the vacancy. b. Incapacity Trustees of HOWARD A. THORNHILL AlIDA H. A. THORNHILL If HOWARD A. THORNIDLL AlKIA H. A. THORNHILL becomes incapacitated while serving as an Initial Tmstee, he shall be replaced by the following Incapacity Tmstee(s) to serve in the priority listed tmtil the list has been exhausted. Unless otherwise specified, if Co-Incapacity Tmstees are serving, the nex, following named Successor Incapacity Trustee(s) shall serve only after all of the Co- Incapacity Tmstees initially fail or thereafter cease to act as Tmstees: AGATHA JANE THORNHILL; THEN CLARE THORNHILL 3-2 ~ ,/ c. Death Trustees of HOWARD A. THORNHILL AlKlA H. A. THORNHILL Upon the death of HOWARD A. THORNHILL NKJA H. A. THORNHILL, he or his Incapacity Trustee, if either is then serving as Trustee, shall be replaced by the following Death Trustee(s) to serve in the priority listed until the list has been exhausted. Unless otherwise specified, if Co-Death Trustees are serving, the next following named Successor Death Trustee( s) shall serve only after all of the Co- Death Trustees initially fail or thereafter cease to act as Trustees: AGATHA JANE THORNHILL; THEN CLARE THORNHILL Section 5. No Designated Successor Trustees If at any time there is no Trustee acting tmder my Trust Agreement and there is no person or institution designated and qualified as a Successor Trustee, a majority of the beneficiaries then eligible to receive distributions of income or principal under my Trust Agreement or their Personal F.:presentatives, shall appoint a S':ccessor Trustee. If any trust existing tmder my Trust Agreement lacks a Trustee and no successor is appointed pursuant to this Article, the vacancy shall be filled by a court of competent jurisdiction. Section 6. Responsibility of Successor Trustees Other thaIl. amending or revoking my Trust, or appointing or removing a Trustee, a Successor Trustee shall have the same rights, powers, duties, discretion and immunities as if named as Initial Trustee under my Trust Agreement. No Successor Trustee shall be personally liable for any act, or failure to act, of any predecessor Trustee or shall have any duty to examine the records of any predecessor Trustee. A Successor Trustee may aCc,ept the account rendered and the property delivered by, or on behalf of, a predecessor Trustee as a full and complete discharge of the duties of the predecessor Trustee without incurring any responsibility or liability for doing so. Section 7. Co-Trustee's Responsibility for the Acts of Other Co-Trustee~ No Co-Trustee shall be responsible for the act, omission or default of any other Co-Trustee without actual knowledge thereof. 3-3 ~ , A,' Section 8. Domestic Trustee When Article Eight directs that the Qualified Domestic Trust Provisions of Article Fifteen are applicable, the following Domestic Trustee(s) shall serve in the order of priority listed until the list has been exhausted. Unless otherwise specified, if Co-Domestic Trustees are serving, the next following Successor Domestic Trustee(s) shall serve only after all of the Co-Domestic Trustees initially fail or thereafter cease to act as Trustees: If such Qualified Domestic Trust Provisions are applicable, a Domestic Trustee shall be appointed in accordance with the other provisions of this Article Three. 3-4 . ~' Article Four Trustor's Lifetime Rights Section 1. Income and Principal a. Right to Trust Income and Principal My Trustee shall pay to me, or apply for my benefit during my lifetime, all or part of the income and principal of my Trust Estate as I may d:iJ:cct. b. Trustee Liability Upon any distribution of the income or principal of my Trust Estate authorized or directed by me, my Trustee shall incur no liability, and shall be under no obligation or responsibility for such distribution. Section 2. Trustor's Rights During Incapacity a. Incapacitated Trustor's Intent to Return Home Notwithstanding any other provision in my Trust Agreement, as a notification to any governmental benefits provider, it is conclusively presumed that I intend to return home. b. Income and Principal Distributions During any period of my incapacity, my Trustee shall pay to my Personal Representative, or apply for my benefit, as much of the net income and principal of my Trust Estate as my Trustee, in my Trustee's discretion, shall deem necessary or advisable. Any undistributed net income shall be added to principal. c. Income and Principal Distribution for the Trustor's Spouse After making payments authorized under Section 2.b of this Article, during any period of my incapacity, my Trustee shall pay to, or apply for the benefit of, my Spouse, as much of my Trust Estate as my Trustee, in my Trustee's discretion, shall deem necessary or advisable, from time to time, for my Spouse's health, education, maintenance or support, taking into consideration my Spouse's other income or resources. Any undistributed net income shall be added to principal. 4-1 . .' d. Tax and Government Benefits Planning Should I become incapacitated, my Trustee shall cooperate in tax and government benefits planning with my Attorney-in-Fact appointed under a durable power of attorney; or, if none, with any Personal Representative that may be appointed by a court of competent jurisdiction, but the primary concern of my Trustee shall be for my welfare and secondarily for such planning. Section 3. Right to Amend or Revoke My Trust During Life and at Death a. Power to Revoke and Amend While I Am Living While I am alive, I may at any time or times amend any provisions of my Trust Agreement or revoke my Trust in whole or in part. b. Method to Revoke or Amend During Life Any amendment or revocation of my Trust Agreement made during my life shall be by a written instrument signed by me and delivered to my Trustee. c. Authorized Power and Method to Amend at Death If Code section 401(a)(9) is interpreted to allow the beneficiaries of a trust to qualify as a "desigD~ted beneficiary" if such trust may be so amended at death, then by a duly probated last will which exercises this power to amend, I may also amend any provisions of my Trust. In addition, my Spouse may amend any trust or trust share over which my Spouse has a general non-lapsing power of appointtnent over principal. Notwithstanding the preceding, any Retirement Benefits allocated to any trust or trust share due to my death shall be held in a separate share of that trust or a separate subshare of. such share, as the case may be, that shall be irrevocable upon my death. The allocation of Retirement Benefits to any such irrevocable trust share or subshare, is intended to qualify the beneficiaries of such trust share or subshare as a "designated beneficiary" under Code section 401(a)(9). d. Trustee Consent Any exercise of a power of amendment substantially affecting the duties, rights and liabilities of my Trustee shall be effective upon my Trustee only if agreed to by my Trustee in writing. .. 4-2 .;, e. Delivery of Property After Revocation After any revocation with respect to my Trust, my Trustee shall promptly deliver the trust property to me. f. Trustee's Retention of Assets Upon Revocation In the event of any revocation of all or part of my Trust, my Trustee shall be entitled to retain sufficient assets to reasonably secure the payment of liabilities my Trustee has lawfully incurred in administering my Trust unless I indemnify my Trustee against loss or expense. Section 4. Exercise of Trustor's Rights and Powers by Others Any right or power, other than an amendment by will, or any right or power that would constitute a general power of appointment if held by my Attorney-in-Fact, that I may exercise under the terms of my Trust Agreement, may be exercised for and on my behalf by any Attorney-in-Fact who, at the time of the exercise, is duly appointed and acting for me under a valid and enforceable power of attorney executed by me. Only if no such Agent is then available, a Personal Representative appointed by a court of competent jurisdiction may exercise such right or power. Other than as provided in this Section 4, the powers under my Trust Agreement are personal to me and may not be exercised by any other person or entity. Section 5. Property Held as Nominee For administrative convenience, it is contemplated that certain assets may be added to my Trust Estate from time to time with the possession and control thereof retained by or redelivered to me. Notwithstanding such control or redelivery, such assets shall be assets of my Trust Estate and held by me as the nominee of my Trustee, During the period such assets are in my possession they shall be subject to the following terms and conditions: a. I may receive directly and devote to my own use and benefit any dividends, interest, income, or proceeds or distributions from or upon such assets and neither I nor my Trustee shall have any duty of accounting to the other or to any other person with regard thereto. .. 4-3 .. b. Any sale, exchange or other transfer of such assets by me shall constitute a withdrawal of such assets from the Trust Estate and my Trustee shall have no further interest therein or duties with regard thereto. Though not a condition precedent to any such withdrawal, I agree to notify my Trustee of all such withdrawals. c. I shall be responsible for the reporting of the income from such assets to the appropriate taxing authorities and my Trustee shall have no responsibility for including such income on any fiduci?ry returns prepared by my Trustee or for the preparation of any other government filing with respect thereto unless I duly notify my Trustee of such income items and a full and adequate accounting thereof is made arid presented to my Trustee. d. I shall protect and indemnify my Trustee against all losses, liabilities and expenses which may result directly or indirectly from my use, possession, management or control of such assets. e. Upon my death or incapacity, my Trustee shall remain entitled to the possession thereof and shall continue to have all the rights, powers and duties with respect to such assets which are granted to my Trustee herein. My Trustee is not responsible for assets held by me as nominee. However, it is also understood that my Trustee shall use any reasOlliible and prudent means to secure possession of any trust assets of which my Trustee has knowledge. My Trustee shall have no duty, accountability or responsibility to me or to any other person with respect to any assets of which my Trustee has no knowledge or of which my Trustee is unable to obtain possession and control. 4-4 Ij' Article Five Administration at Death of the Trustor Section 1. Trustee's parment of Debts and Taxes After my death, unless other provisions for payment have been made, my Trustee shall pay all or any part of the following expenses, debts, claims and taxes from my Trust Estate: a. Final medical expenses and all funeral costs; b. Legally enforceable claims against me; c. Reasonable expenses of administration of my Trust attributable to my probate estate; d. Any allowances mandated by a court of competent jurisdiction to those dependent upon me; e. Any estate, inheritance, succession, generation skipping transfer, or similar taxes payable by reason of my death; and f. Any penalties or interest on any of the above expenses, claims, debts or taxes owed by me or my probate estate. Section 2. Payment by My Trustee or Personal Representative My Trustee, in my Trustee's discretion, may make distributions authorized under this Article either directly to the person or entities to whom payment is owed or to the Personal Representative of my probate estate. Written statements by my Personal Representative that such sums are due and payable by my estate shall be sufficient evidence of their amount and propriety for the protection of my Trustee. My Trustee shall be under no duty to see to the application of any such payments made to my Personal Representative. 5-1 " 'IJ' Section 3. Tax Elections If no Personal Representative has been appointed, with regard to the payment of any income tax, gift tax, estate tax, inheritance tax, Generation Skipping Transfer Tax or any other tax due because of my death, my Trustee shall have the right to make any available elections allowed under the law or to sign and ,file any tax return. If a Personal Representative has been appointed, the Personal Representative shall have the foregoing rights and duties. Section 4. Payment of Death Taxes, Claims and Expenses a. Payment Out of Trust Property All death taxes, claims and expenses payable under the provisions of this Article may be paid by my Trustee out of my Trust Estate except as specifically provided for elsewhere in my Trust Agreement. Such payments may be allocated, partIy or wholly, in my Trustee's discretion, to income or principal; but, to income only to the extent such allocation does not constitute a material limitation upon any trust portion that would otherwise qualify for the federal estate tax Marital Deduction or decrease any otherwise allowable Charitable Deduction. b. Exception for Property Passing Outside of My Trust Notwithstanding Section 4.a of this Article, unless specifically directed otherwise by another separate provision of my Trust Agreement, all death taxes, claims and expenses attributable to assets passing outside of my Tmst or my probate estate shall be assessed against those persons receiving such property; provided, however, that under no circumstances shall any transfer to any beneficiary that qualifies for the federal estate tax Marital or Charitable Deduction cause the property transferred or such beneficiary to bear any such taxes. Section 5. Apportionment of Expenses, Claims and Taxes Notwithstanding Section 4.a of this Article, unless specifically directed otherwise by another separate provision of my Tmst Agreement, all expenses, claims and taxes attributable to any specifically distributed property shall be apportioned to the beneficiaries of such specific distributions. Any distribution of specific trust property under my Trust Agreement shall pass subject to all liens, mortgages or encumbrances attributable thereto. 5-2 , " Section 6. Exception to Apportionment of Death Taxes Notwithstanding any provision in my Trust Agreement to the contrary, it is my intent, and I hereby direct, that to the extent practicable no death taxes shall be apportioned to or against any part of my estate 0; the trusts or shares created by my Trust Agreement, or any beneficiary thereof, which qualifies for the federal estate tax Marital Deduction or Charitable Deduction. 5-3 , .' Article Six Specific Distributions of Trust Property Section 1. Distributions Under Article Six Except for the specific distributions directed in the following Sections of this Article Six, all distributions of trust property shall be made in accordance with the Articles that follow. Section 2. Income in Respect of a Decedent ("IRD") After my death, and after all allocations under Article Seven have been made, my Trustee, in cooperation with the Retirement Account Trustee, shall allocate and distribute, between the Family Trust and the Survivor's Trust, all IRD controlled by my Trustee. Such allocation shall be by fractional share. The fraction of the IRD assets to be allocated to the Survivor's Trust shall be the fraction thereof necessary to fully utilize the Marital Deduction available to my estate while not preventing the maximum use of my Unused Applicable Credit Equivalent (which fraction, depending on the circumstances, may result in some, all or none of the IRD being allocated to the Survivor's Trust). Any IRD not allocated to the Survivor's Trust shall be allocated to the family Trust. Section 3. Estate Planning Letter or Memorandum To the extent permitted by state law and not necessary to fully utilize my Unused Applicable Credit Equivalent, my Trustee shall distribute personal or household items from my Trust Estate to such persons as I may direct by a written instrument signed by me and delivered to my Trustee. Section 4. Specific Distribution Not a Part of My Trust Estate If the property making up any specific distribution set forth in this Article is not part of my Trust Estate at the time such specific distribution is directed to be made and will not become a part of my Trust Estate within a reasonable time, my Trustee shall disregard that specific distribution. 6-1 " Article Seven Division into Survivor's Share and Family Shai'e Section 1. Division of My Trust Estate Upon my death, my Trustee shall allocate and distribute my remaining Trust Estate, including any property that becomes distr.ibutable or payable to my Trustee at my death, into two separate shares to be identified as the Survivor's Share and the Family Share. a. Property Transferred to the Survivor's Share The Survivor's Share shall consist of all assets of my Trust Estate not distributed to the Family Share. b. Survivor's Share to be Administered as Survivor's Trust The Survivor's Share shall be held, administered and distributed according to the provisions of the Survivor's Trust as set forth in Article Eight of my Trust Agreement. c. Property Transferred to the Family Share The Family Share shall consist of an amount of assets of my Trust Estate equal in value to my Unused Applicable Credit Equivalent. d. Family Share to Be Administered as Family Trust The Family Share shall be held, administered and distributed according to the provisions of the Family Trust as set forth in Article Nine of my Trust Agreement. Section 2. Allocation and Valuation of Assets In allocating assets between the Survivor's Share and the Family Share, my Trustee shall allocate the trust assets between the Sm"Vivor's Share and the Family Share in cash or in kind, or partly in each, on a pro rata or non pro rata basis, and in undivided interests or not; subject, however, to the following: 7-1 , ' a. Qualification for Marital Deduction My Trustee shall allocate to the Survivor's Trust only those assets that qualify for the Marital Deduction. b. Valuations of Allocations in Kind Assets allocated in kind shall be valued on the basis of their values as fInally determined for federal estate tax purposes; provided, however, that my Trustee shall act impartially, consistent with equitable principles requiring impartiality among beneficiaries, in allocating assets so that any distribution of assets shall be made of assets, including cash, fairly representative of appreciation or depreciation in the value of all property thus available for distribution. c. Income The Survivor's Shrre and the Farr :\y Share shall be entitled to a currently distributable pro rata share of the income earned on my Trust Estat~ and my probate estate from the date of my death, including a share of income earned on assets used to discharge liabilities. d. Foreign Death Tax Credit My Trustee shall not allocate assets that qualify for the Foreign Death Tax Credit to the Survivor's Share unless all other assets or interests available for allocation have been so allocated. e. Insurance Policies Any policy of insurance on the life of any person held in my Trust Estate shall be allocated to tLe Family Share unless such allocation would cause an estate tax to be due. Notwithstanding any other provisions to the contrary, my Spouse shar not have the right, either individually or in a fiduciary capacity, to hold or control any incident of ownership in, or exercise any power over, any such policy which insures the life of my Spouse or any cash value therein or financial benefit derived therefrom; but, may direct that an Independen' Trustee to exercise such powers be appointed pursuant to the Trustee succession provisions of Article Three that wOl"d apply as if no Trustee were then serving, provided, however, that my Spouse may not otherwise participate in the appointment process. . 7-2 " f. Priority My Trustee shall allocate all assets that are not properly characterized as Income in Respect of a Decedent ("IRD") in accordance with the provisions of this Article Seven. IRD assets shall be allocated and distributed under the provisions of Article Six. If no specific allocation of IRD is directed by Article Six, then IRD also shall be allocated under this Article Seven. Section 3. Intention That Survivor's Share Qualify for Marital Deduction I intend that the Survivor's Share qualify for the federal estate tax Marital Deduction and my Trust Agreement shall be construed accordingly. All other provisions of my Trust Agreement shall be subordinate to that intent. If the granting of any right, power, privilege, authority or immunity to my Trustee or another person or the imposition of any duty upon my Trustee or another person by any provision of my Trust Agreement would disqualify any share or interest of my Spouse from qualifying for the federal estate tax Marital Deduction provider' by Section 2056 of the Code, such provision shall be ineffective if and to the extent that the same, if effective, would so disqualify such share or interest. Notwithstanding any other provision in my Trust Agreement to the contrary, my Spouse at any time shall have the right to direct my Trustee, in writing, to convert to reasonably productive property, any underproductive trust property held in the Survivor's Trust, or in any Trust or Trust share as to which an election is made to qualify all or any part thel.cof for the Marital Deduction under Section 2056(b)(7) of the Code. Section 4. Disclaimer of Property Any power or any interest in property or portion thereof that is disclaimed by my Spouse shall be held, administered or distributed according to the following terms: a. Property Disclaimed My Spouse may disclaim any power or any interest in any property held in trust or otherwise for, or to be distributed to or for the benefit of, my Spouse under my Trust Agreement. b. Time to Disclaim My Spouse may disclaim within the time limits and under the conditions permitted by the laws regulating disclaimers. . 7-3 c. Delivery of Disclaimer to My Trustee A disclaimer by my Spouse may be exercised by the delivery to my Trustee of an irrevocable and unconditional refusal to accept any power or any interest in any property passing to my Spouse or the Survivor's Share. d. Disclaimer of Survivor's Share If my Spouse exercises a disclaimer with respect to any interest in any property set aside as part of the Survivor's Share, any such disclaimed interest shan be added to the Family Share. Notwithstanding any other provisions of my Trust Agreement to the contrary, any such disclaimed interest and income thereon shall not be subject to any power of appointment held by my Spouse other than a power of appointment limited by an ascertainable standard subject to health, education, maintenance or support. e. Discla'ner of Family Share If my Spouse exercises a disclaimer with respect to any interest in any property set aside as part of the Family Share, such disclaimed interest shall be distributed under the relevant terms of the Family Trust. . 7-4 Article Eight Survivor's Trust Section 1. Rights of Spouse in the Survivor's Trust My Trustee shall hold, administer and distribute the assets of the Survivor's Trust as follows: a. Payment of Income My Trustee shall pay to, or apply for the benefit of, my Spouse, so long as my Spouse lives, the entire net income of the Survivor's Trust in monthly or other convenient installments agreed upon by my Spouse and my Trustee, but not less often than annually. If my Trustee is entitled to payments from any Retirement Account, my Trustee shall allocate to income from payments received in any calendar year an amount equal to the income earned by the Account in such year, and any excess shall be allocated to principal, and if the payments in such year are less than the amount equal to the income earned by the Account in such year, my Spouse shall have the continuing right to require my Trustee to withdraw from the Account.and pay to my Spouse, as income, an additional amount so that my Spouse can be paid an amount equal to such income; and to require my Trustee to satisfy any remaining deficiency from principal or make other arrangements to ensure that the Survivor's Trust qualifies for the Marital Deduction. b. Discretionary Payment of Principal At any time or times during my Spollse's life, my Trustee shall pay to, or apply for the benefit of, my Spouse so much of the principal of the Survivor's Trust as my Trustee deems proper for my Spouse's comfort, w,',lfare, acid happiness. In exercising discretion, my Trustee shall give consideration to all other income and resources then known to be available to my Spouse for use for these purposes. c. Right of Surviving Spouse to Withdraw Principal My Trustee shall pay to m) Spouse as much of the principal of the Survivor's Trust as my Spouse may from time to time demand in a signed writing delivered to my Trustee. 8-1 d. General Power of Appointment Subject to any payments required under Section 3 of this Article, upon the death of my Spouse, my Trustee shall distribute all of the Trust Estate of the Survivor's Trust, including the trust principal and accrued and undistributed income, to any person or entity and upon any trust terms and conditions, or to or in favor of the estate of my Spouse as my Spouse may direct by my Spouse's last will. No exercise of this power of appointment shaIl be effective unless it refers to my Trust Agreement and expressly indicates an intention to exercise this power of appointment. My Trustee may rely upon any instrument that my Trustee in good faith believes to be the last will of my Spouse in carrying out the terms of this power of appointment and shaIl not be liable for any good faith act in reliance upon that wiII even if for any reason it is later determined to be invalid with respect to its purported exercise of this power of appointment. If my Trustee receives no notice, within six (6) months after the death of :ny Spouse, of the existence of a wiII of my Spouse that exercises this power of appointment, my Trustee may distribute the Trust Estate of the Survivor's Trust as though this power of appointment had not been exercised and shall be conclusively presumed to have acted in good faith even if such a valid will is thereafter discovered. Section 2. Qualified Domestic Trust Qualification The Qualified Domestic Trust Provisions of Article Fifteen shaIl apply to the Survivor's Trust if qualification of the Survivor's Trust for the Marital Deduction is dependent upon meeting the requirements of Code Section 2056A. If such provisions are applicable, my Trustee shall consider the estate tax consequences of any distributions of principal to my Spouse and may withhold distributions otherwise payable if, in my Trustee's discretion, withholding such distributions is in accordance with the purposes of my Trust. Section 3. Termination Upon the Death of my Spouse The Survivor's Trust shall terminate upon the death of my Spouse. My Trustee shall then hold and administer the balance of the Survivor's Tmst as foIlows: a. Surviving Spouse's Debts and Taxes My Trustee may pay all of my Spouse's foIlowing expenses, debts, claims and taxes becoming due or payable by reason of my Spouse's death and equitably apportioned to the Survivor's Trust: 1. Final medical expenses and all funeral costs; . 8-2 , 2. Legally enforceable claims against the Survivor's Trust or my Spouse's probate estate; 3. Reasonable expenses of administration of the Survivor's Trust and my Spouse's probate estate; 4. Any allowances mandated by a court of competent jurisdiction to those dependent upon my Spouse; 5. Any estate, inheritance, succession, death or similar taxes payable by reason of the death of my Spouse; and 6. Any penalties or interest on any of the above expenses, claims, debts or taxes owed by my Spouse or my Spouse's estate. Section 4. Administration of Remainder of Survivor's Trust After making all payments authorized in the preceding provisions of this Article, my Trustee shall hold and administer the Trust Estate of the Survivor's Trust in accordanc with the following provisions of this Article. Section 5. Payment by My Trustee or Personal Representative My Trustee, in my Trustee's discretion, may make distributions authorized under this Article either directly to the person or entities to whom payment is owed or to the Personal Representative of my Spouse's probate estate. Written statements by my Spouse's Personal Representative that such sums are due and payable by the estate shall be sufficient evidence of their amount and propriety for the protection of my Trustee. My Trustee shall be under no duty .to see to the application of any such payments made to my Spouse's Personal Representative. Section 6. Tax Elections With regard to the payment of any income tax, gift tax, estate tax, inheritance tax, generation skipping tax or any other tax required because of the death of my Spouse, if my Spouse has no Personal Representative and has so authorized my Trustee, my Trustee shall have the right to make any available elections allowed under the law and shall be authorized to sign and file any tax return. If my Spouse has a Personal Representative, the Personal Representative shall have the foregoing rights and duties. If my Spouse has predeceased me, I authorize my Spous'_ 's Trustee, if allY, to act with respect to tax elections if I have no Personal Representative. . 8-3 " Section 7. Generation Skipping Trust a. Creation of GST Shares One and Two Notwithstanding the preceding provisions of this Article, if the value of my Spouse's then taxable estate (inclusive of the Survivor's Share) exceeds my Spouse's Unused Generation Skipping Tax Exemption Equivalent, th,~ Survivor's Trust shall be segregated into separate shares identified as GST Share One and GST Share Two. My Spouse, however, is hereby granted the continuing power to direct my Trustee, in a writing delivered to my Trustee at any time, to disregard the asset allocation provisions (and GST Share creation provisions) of this Section 7 as to any, or all, or any part of any interest in any assets, of my Trust Estate that would be affected by such allocation and to administer such assets in accordance with the other Sections of this Article Eight. My Spouse is encouraged, but not directed, to disclaim such power, in whole or in part, or as to interests in some assets but not others (and is specifically hereby authorized to do so), in order to obtain any available Generation Skipping Transfer Tax exclusion benefits as to such assets of my Trust Estate, Nevertheless, if my Spouse determines that unrestricted access to all or any part of my Trust Estate, or interests in specific assets thereof, is preferable to exclusion from the Generation Slapping Transfer Ta.x, theri my Spouse may retain So muth of this power as desired by not exercising a disclaimer to the extent selected by my Spouse, b. Allocation to GST Share One and Share Two My Trustee shall allocate to GST Share One that fraction of the Survivor's Trust determined by dividing my Unused Generation Skipping Tax Exemption Equivalent by the value of the assets of the Survivor's Trust. Any assets not allocated to GST Share One shall be allocated to GST Share Two, c. Administration of GST Share One My Trustee shall hold, administer and distribute the assets of GST Share One as follows: 1. Payment of Income My Trustee shall pay to, or apply for the benefit of, my Spouse, so long as my Spouse lives, the entire. net income of GST Share 'One in monthly or other convenient installments agreed upon by my Spouse and my Trustee, but not less often than annually. . 8-4 . If my Trustee is entitled to payments from any Retirement Account, my Trustee shall allocate to income from payments received in any calendar year an amount equal to the income earned by the Account in such year, and any excess shall be allocated to principal, and if the payments in such year are less than the amount equal to the income earned by the Account in such year, my Spouse shall have the continuing right to require my Trustee to withdraw from the Account and pay to my Spouse, as income, an additional amount so that my Spouse can be paid an amount equal to such income; and to require my Trustee to satisfy any remciining deficiency from principal or make other arrangements to ensure that the Survivor's Trust qualifies for the Marital Deduction. 2. General Power of Appointment Over Undistributed Net Income Upon the death of my Spouse, my Trustee shall distribute all of the accrued but undistributed net income of GST Share One to any person or entity and upon any trustterms and conditions, or to, or in favor of, th~ estate of my Spouse, as my Spouse may direct by my Spouse's last will. No exercise of this power of appointment shall be effective unless it refers to my Trust Agreement and expressly indicates an intention to exercise this power of appointment. My Trustee may rely upon any instrument that my Trustee in good faith believes to be the last will of my Spouse in carrying out the terms of this power of appointment and shall not be liable for any good faith act in reliance upon that will, even if for any reason it is later determined to be invalid with respect to its purported exercise of this power of appointment. If my Trustee receives no notice, within six (6) months after the death of my Spouse, of the existence of a will of my Spouse, that exercises this power of appointment, my Trustee may distribute the accrued but undistributed net income as though this power of appointment had not been exercised and shall be conclusively presumed to have acted in good faith even if such a valid will is thereafter discovered. 3. Discretionary Payment of Principal At any time or times during my Spouse's life, my Trustee shall pay to, or apply for the benefit of, my Spouse so much of the principal of GST Share One as my Trustee deems proper for my Spouse's health, education, maintenance or support. In exercising . 8-5 discretion, my Trustee shall give consideration to all other income and resources then known to be available to my Spouse for use for these purposes. 4. Limitation on Discretionary Payment of Principal by Trustee Notwithstanding the provisions of Section 7.c.3 of this Article, I recorrunend, but do not require, that my Trustee shall first exhaust the principal frum GST Share Two before making discretionary payments of principal from GST Share One. 5. Limited Power of Appointment By a last will, my Spouse shall have the limited testamentary power to appoint to, or for the benefit of, my descendants some or all of the principal, including unappointed income of GST Share One, as it exists at the date of death of my Spouse after payment of expenses, debts, claims and taxes pursuant to Section 7.c.? of this Article. My Spouse may appoint trust assets under this limited testamentary power among my descendants in equal or unequal amounts, either directly or in trust, as my Spouse directs. This limited testamentary power of appointment shall not be exercised in favor of my Spouse's estate, the creditors of my Spouse, the creditors of my Spouse's estate, or in any way that would result in any economic benefit to my Spouse. If my Trustee receives no notice, within six (6) months after the death of my Spouse, of the existence of a will of my Spouse that exercises this power of appointment, my Trustee may distribute the accmed but undistributed net income as though this power of appointment had not been exercised and shall be conclusively presumed to have acted in good faith even if such a valid will is thereafter discovered. 6. Termination Upon the Death of my Spouse GST Share One shall terminate upon the death of my Spouse. My Trustee shall then hold and administer the balance of GST Share One in accordance with the following provisions of this Section .7.c. . 8-6 7. My Spouse's Debts and Taxes Taking into consideration any waiver pursuant to section 2207 A of the Code in the last will of my Spouse, my Trustee may pay all of my Spouse's fonowing expenses, debts, claims and taxes becoming due or payable by reason of my Spouse's death and equitably apportioned to the Survivor's Trust; but from GST Share One only to the extent not paid from GST Share Two: (a) Final medical expenses and all funeral costs; (b) Legally enforce3 hIe claims against the Survivor's Trust or my Spouse's probate estate; (c) Reasonable expenses of administration of the Survivor's trust and my Spouse's probate estate; (d) Any allowances mandated by a court of competent jurisdiction to those dependent upon my Spouse; ( e) Any estate, inheritance, succession, death or similar taxes payable by reason of the death of my Spouse; and (t) Any penalties or interest on any of the above expenses, claims, debts or taxes owed. 8. Payment by My Trustee or Personal Representative My Trustee, in my Trustee's discretion, may make distributions authorized under this Section either directly to the person or entities to whom payment is owed, or to the Personal Representative of my Spouse's probate estate. Written statements by my Spouse's Personal Representative that such sums are due and payable by the estate shall be sufficient evidence of their amount and propriety for the protection of my Trustee. My Trustee sh,),ll be under no duty to see to the application of any such payments made to my Spouse's Personal Representative. . 8-7 .' 9. Tax Elections With regard to the payment of any income tax, gift tax, estate tax, inheritance tax, generation skipping tax or any other tax required because of the death of my Spouse, if my Spouse has no Personal Representative and has authorized my Trustee to so act, my Trustee shall have the right to make any available elections allowed under the law and shall be authorized to sign and file any tax return, If my Spouse has a Personal Representative, the Personal Representative shall have the foregoing rights and duties, If my Spouse predeceased me, I authorize my Spouse's Trustee, if any, to act with respect to tax elections if I have no Personal Representative, 10. Administration of Remainder of GST Share One After making all payments authorized above in this Article Eight, my Trustee shall hold and administer GST Share One as provided in the'\rticles that follow, d. Administration of GST Share Two My Trustee shall hold, administer and distribute the assets of GST Share Two pursuant to the terms of Sections 1 through 6, inclusively, of this Article, and after making all payments authorized in said Sections, my Trustee shall hold and administer GST Share Two as provided in the Articles that follow. . 8-8 Article Nine Family Trust Section 1. Rights of My Spouse in the Family Trust My Trustee shall hold, administer and distribute the assets of the Family Trust as follows: a. Payment of Income My Trustee shall pay to, or apply for the benefit of, my Spouse, so long as my Spouse lives, the entire net income of the Family Trust in monthly or other convenient installments as agreed upon by my Spouse and my Trustee, but not less often than annually. b. Discretionary Payment of Principal At any time or times during my Spouse's life, my' Trustee shall pay to, or apply . for the benefit of, my Spouse, so much of the principal of the Family Trust as my Trustee in my Trustee's discretion deems proper for my Spouse's health, education, maintenance or support. c. Guidelines for Trustee's Discretion In exercising discretion, my Trustee shall give consideration to all other income and resources then known to be available to my Spouse. In exercising discretion, my Trustee may, but is not required to, consider any differences in income tax rates as to the Family Trust and permissible distributees of principal. My Trustee shall accumulate and add to principal any net income not distributed. d. Limitation on Discretionary Payment of Principal by Trustee I recommend, but do not require, that my Trustee shall first exhaust the principal from the Survivor's Trust before making discretionary payments of principal to my Spouse from the Family Trust. e. My Sponse's Right to Withdraw Principal My Spouse shall have the power to withdraw from the Family Trust principal each calendar year those amounts that shall not exceed the greater of five thousand dollars ($5,000) or five percent (5%) of the assets of the Family Trust, valued as of the end of the preceding calendar year. My Spouse shall exercise this power 9-1 by a written instrument signed by my Spouse and delivered to my Tmstee. This power is noncumulative and it shall lapse to the extent it is not exercised by January 2 of each calendar year. This power shall exist each year until the death of my Spouse. Section 2. Qualified Terminable Interest Property Election It is my intent that the Family Tmst qualify in all respects for the Marital Deduction if a Qualified Terminable Interest Property election is made by my Tmstee. Pursuant to that intent, my Spouse is hereby granted the authority to require my Trustee to make underproductive property productive. Section 3. Termination of the Family Trust On the death of my Spouse, the Family Trust shall terminate. All unappointed and undistributed tmst assets, including any accrued and undistributed net income, shall be held, administered and distributed pursuant to the Articles that follow. .. 9-2 Article Ten Common Pot Trust At the death of the survivor of me and my Spouse, my Trustee shall not create a Common Pot Trust. All of my Trust Estate that has not been distributed under prior Articles of my Trust Agreement shall be held, administered, divided and distributed according to the provisions of the Articles that follow. 10-1 .' Article Eleven Division and Distribution of Trust Property Section 1. Division of Trust Property Into Shares While, to the extent practical, maintaining any previously established Generation Skipping Transfer TaJ{ ratios relative to trust property, my Trustee shall divide, into separate shares, all of my Trust Estate not previously distributed under the preceding Articles of my Trust Agreement (and for purposes of determining such division and subsequent distributions shall ta1.:e into account the exclusion of any descendant as may be directed in Article One) as follows: Beneficiary Name Share CLARE THORNHILL PATRICK THORNHILL TRUST FOR GRANDCHILDREN 1/3 1/3 1/3 The trust shares shall be held, administered and distributed as follows: a. Distriblltion of Trust Share for CLARE THORNHILL The trust share set aside for CLARE THORNHILL shall be held, administered and distributed as follows: 1. Distributions of Net Income ,My Trustee, in my Trustee's discretion, shall apply to, or for the benefit of, such beneficiary, so much of the net income from such beneficiary's Ullst shaTe as my Trustee deems advisable for such beneficiary's health, education, maintenance or support. Any undistributed income shall be added to principaL 11-1 2. Distributions of Principal My Trustee, in my Trustee's discretion, shall pay to, or for the benefit of, such beneficiary, so much of the principal from such beneficiary's trust share as my Trustee deems advisable for such beneficiary's health, education, maintenance or support. At the death of the second to die of my spouse and me, my Trustee shall distribute thirty (30%) percent of the principal of the trust share to such beneficiary, free of trust. Five (5) years after the death of the second to die of my spouse and me, my Trustee shall distribute one-half (1/2) of the principal of the trust share to such beneficiary, free of trust. Ten (10) years after the death of the second to die of my spouse and me, my Trustee shall distribute the balance of the accumukted net income and principal of the trust share to such beneficiary, free of trust. 3. Distribution on Death of Beneficiary If such beneficiary should die prior to the time that a distribution is directed to be made, the beneficiary's interest in the balance of the trust share shall be distributed as follows: Fifty (50%) percent to PATRICK THORNHILL in accordance with the provisions of Section l.b. of this Article Eleven; Fifty (50%) percent to the TRUST FOR GRANDCHILDREN, in accordance with the provisions of Section 1.c. of this Article Eleven. b. Distribution of Trust Share for PATRICK THORNHILL The trust share set aside for PATRICK THORNHILL shall be held, administered and distributed as follows: 1. Distributions of Net Income My Trustee, in my Trustee's discretion, shall apply to, or for the benefit of, such beneficiary, so much of the net income from such beneficiary's trust share as my Trustee deems advisable for such beneficiary's health, education, maintenance or support. Any undistributed income shall be added to principal. *"''''''' 11-2 2. Distributions of Principal My Trustee, in my Trustee's discretion, shall pay to, or for the benefit of, such beneficiary, so much of the principal from such beneficiary's trust share as my Trustee deems advisable for such beneficiary's health, education, maintenance or support. At the death of the second to die of my spouse and me, my Trustee shall distribute thirty (30%) percent of the principal of the trust share to such beneficiary, free of trust. Five (5) years after the death of the second to die of my spouse and me, my Trustee shall distribute one-half (1/2) of the principal of the trust share to such beneficiary, free of trust. Ten (10) years after the death of the second to die of my spouse and me, my Trustee shall distribute the balance of the accumulated net income and principal of the trust share to such beneficiary, fi'ee of trust. 3. Distribution on Death of Beneficiary If such beneficiary should die prior to the time that a distribution is directed to be made, the beneficiary's interest in the balance of the trust share shall be distributed as follows: Fifty (50%) percent to the TRUST FOR GRANDCHILDREN, in accordance with the provisions of Section 1.c. of this Article Eleven; Twenty-five (25%) percent to such beneficiary's spouse, JANICE BETII THORNHILL, so long as she has not remarried, free of trust; and Twenty-five (25%) percent to CLARE THORNHILL, in accordance with the provisions of Section l.a. of this Article Eleven. If such beneficiary has no spouse, the trust share for JANICE BETH THORNHILL shall terminate and my Trustee shall distribute the trust share to CLARE THORNHILL, in accordance with the provisions of Section La. of this Article Eleven. c. Distribution of Trust Share for TRUST FOR GRANDCmLDREN The trust share set aside for the TRUST FOR GRANDCHILDREN shall be further divided into separate equal shares so as to provide one (1) share for each grandchild. Each trust share shall be held, administered and distributed as follows: >10... 11-3 1. Distributions of Net Income My Trustee, in my Trustee's discretion, shall apply to, or for the benefit of, such beneficiary, so much of the net income from such beneficiary's trust share as my Trustee deems advisable for such beneficiary's health, education, maintenance or support. Any undistributed income shall be added to principal. 2. Distributions of Principal My Trustee, in my Trustee's discretion, shall apply to, or for the benefit of, such beneficiary, so much of the principal from such beneficiary's trust share as my Trustee deems advisable for such beneficiary's health, education, maintenance and support. When each beneficiary attains the age of twenty-one (21) years, my Trustee shall distribute one-third (1/3) of the trust share to such beneficiary, free of trust. When each beneficiary attains the age of twenty-five (25) years, my Trustee shall distribute one-half (1/2) of the remaining balance of the trust share to such beneficiary, free of trust. When each beneficiary attains the age of thirty (30) years, my Trustee shall distribute the remaining balance of accumulated net income and principal to such beneficiary, free of trust. 3. Distribution on Death of Beneficiary If any beneficiary should die prior to the time that a distribution is directed to be made, the beneficimy's interest in such trust share shall lapse and my Trustee shall distribute the balance of the trust share equally to my surviving grandchildren. If I have no surviving grandchildren, my Trustee shall distribute the balance of the trust share, in equal shares, to my surviving children. If I have no surviving children, my Trustee shall distribute the balance of the trust share in accordance with the Articles that follow. ..."''''... 11-4 Section 2. Distributions to Underage or Incapacitated Beneficiaries Notwithstanding any provision to the contrary in this Article Eleven and subject to Section 2 of Article Fifteen, if any beneficiary otherwise entitled to receive a distribution of trust property is under the age of 30 years or is incapacitated, as defined in Article Fifteen, my Trustee shall retain and administer such beneficiary's trust share for such beneficiary's benefit pursuant to the following provisions of this Article Eleven: a. Incapacitated Beneficiary If such beneficiary's trust share is being held under this Section 2 due to such beneficiary's incapacity (as defined in Article Fifteen) then, only during the term of such incapacity, such beneficiary's trust share shall be administered according to the Special Needs Provisions of Article Fifteen. Upon the beneficiary's regaining capacity (as determined under Article Fifteen) the following provisions of this Article Eleven shall apply. b. Underage Beneficiary If such beneficiary's trust share is being held under this Section 2 due to such beneficiary's being under the age of 30, such beneficiary's trust share shall be administered as follows: 1. My Trustee's Discretion My Trustee shall pay to, or apply for the benefit of, such beneficiary, so much of the net income and principal of such beneficiary's trust share as my Trustee, in my Trustee's discretion, deems proper considering all other resources then known to be available to such beneficiary. 2. Payments Made to Beneficiary or Personal Representative My Trustee is authorized to make payments under this Section 2.b directly to the beneficiary, to the beneficiary's Personal Representative or to any other person my Trustee may deem proper to be used for the benefit of the beneficiary. 3. Trustee's Decisions Are Final All decisions by my Trustee as to whom my Trustee makes payments, the purposes for which payments are made and the amounts to be paid out of any trust share are within my Trustee's discretion. **'*'" 11-5 4. Undistributed Net Income All undistributed net income shall be accumulated and added to the principal of the trust share. Section 3. Termination and Distribntion as to Underage or Incapacitated Beneficiary Unless distributions from a trust share are withheld pursuant to Section 1 of Article Fifteen, my Trustee shall distribute the trust share to the respective beneficiary of the share being held under Section 2 of this Article Eleven on the latest to occur of (i) the date upon which such beneficiary reaches the age of 30 years, (ii) the times for distribution provided in the preceding Sections of this Article Eleven, if any, or (iii) when such beneficiary is no longer incapacitated, as determined pursuant to the provisions of Article Fifteen. Section 4. Death of Incapacitated or Underage Beneficiary Subject to the provisions of preceding Sections of this Article Eleven, if any beneficiary whose trust share is being held in trust under such Sections dies before the complete distribution of such beneficiary's trust share, the beneficiary's interest in such trust share shall lapse and my Trustee .. .<..__ ......._..... _._. ____ w"__' '" " '.'.n........._ .. .. ..............._... ".__.__.. ....'__..... shall distribute such beneficiary's trust share to such beneficiary's then living descendants, per stirpes; or, if none, to my then living descendants, per stirpes. If I have no then living descendants, my Trustee shall distribute such beneficiary's trust share as provided in the Articles that follow. Section 5. General Power of Appointment Over Certain Assets If any separate share or trust established under this Article Eleven shall terminate, or if a beneficiary's interest therein lapses, upon the death of the beneficiary thereof, my Trustee shall, anything herein to the contrary notwithstanding, distribute to such appointee or appointees who are creditors of the estate of such deceased beneficiary, in such proportions and amounts as such deceased beneficiary shall direct and appoint by such deceased beneficiary's last will and testament referring specifically to this general power of appointment, those assets composing such separate share or trust the transfer of which pursuant to the terms hereof, other than this >II"'.. 11-6 .' .i Section 5, and assuming the nonexercise of any special testamentary power of appointment elsewhere herein conferred upon such deceased beneficiary, upon such termination would, but for such general power, cause any tax under Chapter 13 of the Code to be payable. If such deceased beneficiary shall fail in whole or in part to exercise such general power, then the assets subject to such general power with respect to which such deceased beneficiary shall have failed to exercise such general power shall be distributed as otherwise provided in my Trust Agreement. *"'.'" 11-7 Article Twelve Distribution if No Designated Beneficiaries NONE 12-1 .' Article Thirteen Trustee Administration Section 1. Required Vote for Co-Trustees a. Trustor Serving as Co-Trustee Unless otherwise provided in my Trust Agreement, if I am serving as a Co-Trustee under my Trust Agreement, I may make decisions and bind my Trust in the exercise of all powers and discretions granted to me as Trustee without the consent of any other Trustee. b. Unanimous Vote for Two Trustees Other than when I am serving as Co-Trustee, if only two Trustees are serving, they shall act unanimously in the exercise of all powers and discretions granted to them under my Trust Agreement. c. Majority Vote for More Than Two Trustees Other than when I am serving as a Co-Trustee, if more than two Trustees are serving under my Trust Agreement, they shall act by majority vote and any exercise of a power or discretion by a majority of the Trustees shall have the same effect as an exercise by all of them. d. Court Order Resolves Disputes Other. than when I am serving as a Trustee, if the Trustees are not able to reach agreement on any decision as set forth in this Section I, they shall petition a court , of competent jurisdiction for instructions and shall take no action on the disputed matter until a court order deciding the issue has been rendered. Section 2. Power to Delegate Notwithstanding any other provision of my Trust Agreement, anyone or more of the Co-Trustees serving under my Trust Agreement may from time to time delegate to another Co-Trustee or Co-Trustees routine acts of trust administration. 13-1 .' Section 3. No Bond Required No Trustee specifically named under my Trust Agreement shall be required to post any bond for the faithful performance of such Trustee's responsibilities. Section 4. Trustee Compensation Other than when I am serving as Trustee, my Trustee shall be entitled to reasonable compensation for services rendered. Such compensation is payable without the need of a court order. In calculating the amount of compensation, customary charges for similar services in the same geographic area for the same time peliod shall be used as guidelines. Any corporate fiduciary shall be entitled to receive compensation for its se, vices in accordance with its published fee schedule in effect from time to time and any trustee who is norma!:y compensated 01' an hourly basis shall be so compensated. My Trustee shall also be entitled to reimbursement for reasonable costs and expenses incurred during the exercise of my Trustee's duties under my Trust Agreement. Section 5. Change in Corporate Trustee Any corporate successor to the trust business of any corporate trustee named under my Trust Agreement, or acting hereunder, shall succeed to the capacity of its predecessor without re- conveyance or transfer of trust property. Section 6,. Written Notice to Trustee Until my Trustee receives written notice of any death or other event which triggers the right to payments from any trust or trust shares created under my Trust Agreement, my Trustee shall incur no liability for distributions made in good faith to persons whose interests may have been affected by such event. Section 7. Duty to Account My Trustee shall render accounts, upon request, to the income beneficiaries Imder my Trust Agreement at least armually, at the termination of a trust created hereunder and upon a change in the Trustees in the manner required by law. 13-2 Section 8. No Court Supervision No trust or trust share created under my Trust Agreement shall require the active supervision of any state or federal court. 13-3 Article Fourteen Trustee Powers Section 1. Powers In addition to any power hereinafter specifically granted to my Trustee, it is my intention that my Trustee have the power respecting property in my Trust Estate that an absolute owner of such property would have. In accordance with such intention, any power my Tmstee needs to administer my Trust Estate, which is not hereinafter listed, shall be considered as provided for herein. All powers shall be exercised only in a fiduciary capacity. It is also my intention that the Uniform Prudent Investors Act and any similar enacted statute shall not apply to govern any of my Trustee's actions. The principles of the prudent person mle shall apply to govern the actions of my Trustee except that I hereby direct that its appliGation be suspended as to my Spouse's acting in such a capacity. a. Retention of Property My Trustee shall have the power to retain any property received into my Trust at its inception, or later added to my Trust, without regard to whether my Trust investments are diversified, as long as my Tmstee considers that retention is in the best interests of my Trust or is in furtherance of my goals in creating my Trust. Subject to any power of my Spouse to require underproductive property to be made reasonably productive, my Trustee shall have the power to invest and reinvest in any property that may be considered by applicable state law to be lmderproductive or unproductive in nature and, specifically to be exempt from any minimum income requirements called for under local law. b. Additions My Trustee shall have the power to receive additions to the assets of the various trusts created under my Trust Agreement from any source. c. Business Participation My Trustee shall have, notwithstanding any overall effect on the fair market value. of the property held in any trust or trust share, the power to form, terminate, continue or participate in the operation of any business enterprise including a corporation, a sole proprietorship, a general or limited partnersn;;J (as a general or limited partner) or a limited liability company (as a managing or nonmanaging member) and to effect any form of incorporation, dissolution, liquidation or 14-1 reorganization, including, but not limited to, recapitalization and reallocation of classes of shares or other changes in the form of the business enterprise or to lend money or make a capital contribution to any such business enterprise. d. Make Investments My Trustee shall have the power to invest and reinvest the assets of my Trust as my Trustee may determine to be in the best interests of my Trust without limitation by any law applicable to investments by fiduciaries. The permitted investments and reinvestments may include securities such as common or prefeITed stock, mortgages, notes, subordinated debentures and warrants of any corporation, any common trust fund administered by a corporate fiduciary, other property, real or personal, including savings accounts and deposits, interests in mutual or money market funds or investment trusts, annuities and insurance whether or not such investments are unsecured or of a wasting nature. Any corporate trustee is authorized to invest in shares of an investment management company organized under the Investment Company Act of 1940 (commonly known as a mutual fund) for which the corporate trustee serves as an investment advisor, custodian, or in any other capacity, for remuneration. e. Life Insurance My Trustee shall have the power to obtain, by purchr.se or by gift or by conversion, reissue, consolidation or by any other means, and hold as an asset of my Trust, policies of insurance on my life or the life of any other beneficiary of my Trust. My Trustee is authorized and empowered to exercise, either before or after my death, all of the rights, options, elections or privileges exercisable in connection with such .policies. These rights and options shall include, but not be limited to, incapacity benefits, the right to bOITOW motley with which to pay premiums (or other charges) on any policy owned by my Trust (including any automatic premium loan feature) or for any other trust purpose, the right to elect among settlement options offered by the insur:mce company that issued such policy, the right to conveli such policy to paid-up insurance, extended term insurance or to any different form of insurance, and the right to arrange for the automatic application of dividends in reduction of premium payments (or other charges) with regard to any policy of insurance held in my Trust Estate. Regarding any such policies: 1. I represent that any policies of life insurance currently transfeITed into my Trust, or that will be transfeITed to my Trust hereinafter or purchased at my direction, have been selected (or will 'be selected) solely by me based on my study and evaluation of (a) the sufficiency of the policy to meet the goals of my Trust, (b) whether or not available 14-2 policy elections should be made, and (c) the current and projected [mancial strength and viability of the company issuing the policy. 2. My Trustee has made no representations to me concerning these policies and none of my study and evaluation of the policy or policies has been based on any representation by my Trustee. Furthermore, my Trustee is under no obligation to examine such policies upon receipt or to make subsequent or periodic evaluations of same. The obligations to examine and evaluate shall remain exclusively with me. 3. In the event that I or any beneficia!')' hereunder shall at any time (1) question the sufficiency of any life insurance policy, (2) determine that available policy elections should be made, or (3) question the continued financial strength or viability of the carrier, it shall be their absolute obligation to inform my Trustee of those facts in writing. My Trustee shall be indemnified and held harmless for any actions taken or not taken pertaining to any such policies held by my Trust. f. Dealing With Property My Trustee shall have the power to acquire, grant, hold in a safe deposit box or dispose of real or personal property of all kinds including, but not limited to, puts, calls and options (including options on stock), for cash or on credit, including maintaining margin accounts with brokers, at public or private sale, upon such terms and conditions as my Trustee may deem advisable, and to manage, develop, improve, exchange, partition, change the character of, or abandon property, or any interest therein, or otherwise deal with real or personal property including, but not limited to, the placing or releasing of liens and encumbrances on real or personal property. g. Environmental Compliance Specifically, my Trustee shall have the power to use and expend my Tmst income and principal to conduct environmental assessments, audits, and site monitoring to determine compliance with any environmental law or regulation thereunder; to take all appropriate remedial action to contain, clean up or remove any environmental hazard, including a spill, release, discharge or contamination, either on my Tmstee's own accord or in response to an actual or threatened violation of any environmental law or regulation theretmder; to institute legal proceedings concerning environmental hazards or contest or settle any such legal proceedings 14-3 brought by any local, state or federal agencies concerned with environmental compliance, or by a private litigant; to comply with any local, state or federal agency order, or court order directing an assessment, abatement or cleanup of any environmental hazards; to employ agents, consultants and legal counsel to assist in or perform the above undertakings or actions; and, in general, to take all appropriate actions to prevent, identify, or respond to any actual or threatened violations of any environmental law or regulation thereunder. No Trustee under my Trust Agreement shall be liable for any loss or depreciation in value sustained by my Trust as a result of my Trustee retaining any property upon which there is later discovered to be hazardous materials or substances requiring remedial action pursuant to any federal, state or local environmental law unless my Trustee contributed to the loss or depreciation in value through willful default, willful misconduct, or gross negligence. Moreover, my Trustee shall not be obligated to accept any property on behalf of my Trust without my Trustee first having the opportunity to detennine, in my Trustee's discretion, that such property is not contaminated by any hazardous or toxic materials or substances, and that such property is not being used and has never been used for any activities directly or indirectly involving the generation, use, treatment, storage, disposal, release, or discharge of any hazardous or toxic materials or substances. Finally, my Trustee shall have the power to disclaim any power that, in my Trustee's discretion, will or may cause my Trustee to be considered an "owner" or "operator" of property held in my TrustEstate under the provisions of the Comprehensive EnviroIllliental Response, Compensation and Liability Act (CERCLA), as amended from time to time. This power to disclaim, as contained herein, shall apply to any such power, whether actually set forth under my Tmst Agreement, incorporated by reference herein, or granted or implied by any statute or rule of law. h. Borrowing Authority My Trustee shall have the power to borrow funds from any'person, including my Trustee; to guarantee indebtedness or indemnify others in the name of my Trust and to secure any such obligation by mortgage (including, but not limited to reverse mortgages), pledge, secmty interest or other encmnbrance; and to renew, extend or modify any such obligation for a term within or extending beyond the administration of the term of my Trust. No lender shall be bound to see to, or be liable for, the application of the proceeds of any obligation and my Trustee shall not be personally liable for any obligation unless such Trustee and the lender so agree in writing. 14-4 i. Leasing Authority My Trustee shall have the power, with respect to real or personal property, to make, renew or amend for any purpose a lease, as lessor or lessee, for a term within or beyond the term of my Trust with or without option to purchase. j. Natural Resources My Trustee shall have the power to enter into any arrangement or agreement, including a lease, pooling or unitization agreement for exploration, development, operation, conservation and removal of minerals or other natural resources. k. Voting Rights My Trustee shall have the power to vote a security in person or by general or limited proxy; to participate in or consent to any voting trust, reorganization, dissolution, liquidation or other action affecting any securities; and to deposit securities with, and transfer title to, a protective or other committee. I. . Title to Assets My Trustee shall have the power to hold securities and other property wIietner reaT or personal and whether or not in negotiable form or in the name of a nominee (including "street name" of a broker) or by deposit to a clearing corporation, with or without dise!osure of the Trustee relationship, but my Trustee shall be responsible for the acts of any nominee in the scope of the nominee's authorized actions with respect to such property or clearing corporation in connection with the property. m. Insurance My Trustee shall have the power to insure the assets of my Trust against any risk, and my Trustee against liability, with respect to third persons. n. Settlement of Disputes My Trustee shall have the power to payor contest any debt or claim; to compromise, release and adjust any debt or claim; and to submit any matter to arbitration. 14-5 o. Payment of Expenses My Trustee shall have the power to pay any taxes, assessments, reasonable compensation of my Trustee and other expenses incurred in the collection, management, care, protection and conservation of my Trust Estate. p. Principal and Income My Trustee shall have the power to allocate receipts or expenditures to either income or principal and to create reserves out of income as my Trustee, in my Trustee's discretion, deems appropriate and my Trustee's.decision, made in good faith with respect thereto, shall be binding and conclusive on all persons. This power of allocation shall also apply to income during administration of my Trust after my death. Notwithstanding the preceding sentence, if the Survivor's Trust (or a share thereunder) is the beneficiary of a Retirement Account, income earned after the participant's death in the account shall be income of such trust or share, and if my Trustee is required to pay all of the trust income to a beneficiary, my Trustee shall collect and pay the income of the account to the beneficiary at least quarterly. To the extent that all of the income cannot. be collected from the account, the deficiency shall be paid from the principal of such trust or share. Income during administration after my death is currently distributable. q. Distribution of Trust Property My Trustee shall have the power to make any distribution or payment in kind or in cash, or partly in kind and partly in cash, and to cause any share to be composed of cash, property or undivided interests in property different in kind from any other share, either pro rata or non pro rata, without regard to differences in the tax basis of such property and without the requirement of making any adjustment of the shares by reason of any action taken pursuant hereto. Any division, allocation, apportionment or valuation of trust property in order to distribute the assets to or arnong any of the trusts, shares or beneficiaries shall be made by my Trustee, and the good faith determination of my Trustee shall be binding and conclusive on all parties. In order to maximize the benefits of my Unused Generation Skipping Tax Exemption Equivalent, my Trustee may consider the inclusion ratio of any Trust, share or subshare when making any distribution, division, aiJocation or apportionment lmder my Trust Agreement. 14-6 .' r. Litigation My Trustee shall have the power to prosecute or defend actions, suits, claims or proceedings for the protection or benefit of my Trust and my Trustee in the performance of my Trustee's duties. s. Employment of Agents My Trustee shall have the power to employ agents, including attorneys, accolmtants, investment advisors, custodians, appraisers or others, including any firm of which my Trustee is a member, to advise or assist my Trustee, to delegate to them fiduciary powers and to indemnify them against liability for positions taken in good faith and with reasonable basis. t. Corporate Fiduciary If any stock of a corporate trustee that is my Tmstee, or of any affiliate or successor of such Tmstee, shall be included in the assets of my Trust, my Trustee shall have full authority, in my Trustee's discretion, and notwithstanding any regulation or rule of law to the contrary, to retain the stock and any increases resulting from stock dividends and stock splits and from the exercise of purchase rights and the purchase of fractional shares needed to round out fractional share holdings' that rniiY:irise concerning the stock. My Trustee shalf vote such stock either directly or by proxy. However, to the extent my Trustee is prohibited by law from voting such stock, my Trustee shall vote in accordance with the written instructions of a majority of the then living beneficiaries then entitled to current distributions of income, or their Personal Representatives. In the event no instruction is given, my Trustee is authorized to vote the stock in the best interests of the beneficiaries in view of the purposes for which my Trust was created. u. Investment Transactions With regard to record keeping for investment transactions, my Trustee need not provide copies of confirmations or similar notifications each time a trade or investment transaction occurs, but investment transactions shall be set forth in my Trustee's periodic accounting. v. Repairs and Improvements My Trustee shall have the power to make ordinary or extraordinary repairs or alterations in buildings or other structures, to demolish any improvements, and to raze existing or erect new party walls or buildings or other structures. 14-7 w. Business Personnel My Trustee shall have the power to elect or employ directors, officers, employees, partners or agents of any business and to compensate such persons, whether or not any such person is a Trustee, director, officer, partner or agent of my Trustee or a beneficiary of my Trust. x. Farm or Ranch Property With respect to farm or ranch property, my Trustee shall have all necessary powers to participate in and operate any fanning (including tree farming) or ranch operation personally or with hired labor, tenants or sharecroppers, to lease any farm for cash or a share of crops under a lease that permits or precludes the material participation of my Trustee to fertilize and improve the soil; to employ conservation practices; to participate in government programs; and to perform any other acts deemed by my Trustee necessary or desirable to operate the property. In making a decision whether to materially participate in farming or ranch operations, my Trustee shall consider whether an election should be made or has been made under Code Section 2032A to qualify for special farul-use valuation. y. Ancillary Fiduciaries If, for any reason, my Trustee deems it advantageous to act through an ancillary fiduciary, my Trustee may designate an ancillary Trustee qualified to serve in the jurisdiction where such ancillary fiduciary is to act and may delegate to such ancillary fiduciary such of the powers granted under my Trust Agreement as my Trustee deems advisable without being chargeable with loss, if any, arising out of such designation or delegation. My Trustee may specify whether any corporate fiduciary, or any person or persons acting in an ancillary capacity hereunder, shall . serve with or without bond. Except as may be otherwise specifically provided, no such ancillary fiduciary need comply with the provisions of any Uniform Trustee's Accounting Act, the Uniform Trust Act or similar acts in force in any state where the fiduciary may be acting. z. Retention of Closely Held Interest My Trustee shall have the power to retain any real estate interests, closely held securities or affiliated companies or business interests, and to sell or dispose of such interests only after careful consideration and after determining that sale or disposition is under the existing circUll1stances in the best interests of my Trust or its beneficiaries. 14-8 aa. S Corporations If at any time my Trust holds any stock in an S corporation, and my Trustee deems it appropriate for such corporation to maintain its Sub~hapter S election, or if my Trustee deems a Subchapter S election advisable for any corporation the stock of which is held in my Trust, my Trustee may take all of the necessary actions as to such election and may segregate the S corporation stock, or other corporation stock for which a Subchapter S election is to be made, from the other assets of my Trust, and in my Trustee's discretion, and otherwise consistent with the terms of my Trust to the greatest extent possible, may form new trusts and may amend the terms of my Trust Agreement as would be necessary to establish Qualified Subchapter S Trusts to hold the said S corporation stock and assets in compliance with Code Sections 136l(b) and l361(d)(3). bb. Exercise of Authority Except as otherwise provided in my Trust Agreement, my Tmstee shall have the power to do all acts that might legally be done by an individual in absolute ownership and control of property. ce. Power to Divide or Combine Trusts My Trustee shall have the power to divide a single trust or share thereof into separate divisions, each to be administered in accordance with. the terms and conditions of the single trust, from which they were created (or in accordance with such terms and conditions as they may be affected by my Trustee's power to comply with S Corporation requirements) when my Trustee, in my Tmstee's discretion, determines that division is desirable or advisable in view of tax considerations, including considerations related to income tax, gift tax, inheritance tax or generation skipping transfer tax or other objectives of the trusts and their beneficiaries. My Tmstee shall not be required to make a physical segregation or division of the various tmst subdivisions created under my Trust Agreement except as segregation or division may be required by reason of the termination and distribution of any of the trust subdivisions, but my Trustee shall keep separate accounts and records for different undivided interests. My Trustee, in my Trustee's discretion, shall have the further power to combine two or more trusts or tmst subdivisions having substantially the same terms into a single trust for purposes of administration when tax or other factors indicate that such combination would be desirable or advisable. 14-9 -, In deciding whether to combine trusts or trust subdivisions, my Trustee shall consider the generation skipping "inclusion ratio" of the trusts or trust subdivisions to be combined. Trusts or trust subdivisions having the same inclusion ratios may be combined. Trusts or trust subdivisions having different inclusion ratios should generally not be combined unless their inclusion ratios are maintained unchanged through substantially separate and independent shares of different beneficiaries within the meaning of Code Section 2654(b) and the applicable regulations thereunder. Specifically, unless there is a Personal Representative, my Trustee has the authority to allocate any portion of my respective exemptions under Code Section 2631(a) to property as to which I am the respective transferor, including any property transferred by myself during my lifetime as to which I did not make an allocation prior to my death. My Trustee also has the authority to make the special election under Code Section 2652(a)(3). If Code Section 2631 (a) or 2652(a)(3) is not interpreted as to allow a Trustee to exercise such election, then a Personal Representative shall be appointed and is authorized to allocate my respective exemptions and to exercise the said special election. If my Trustee considers thai any distribution from a tmst or trust subdivision hereunder, other than pursuant to a power to withdraw or appoint, is a taxable distribution subject to the federal Generation Skipping Transfer Tax payable by the distributee, my Tmstee may increase the distribution by an amount that my Trustee would estimate to be sufficient to pay that tax and any additional tax thereon, and shall charge the same against the trust or trust subdivision to which the tax relates. If my Trustee considers that any termination of an interest in my Trust or a trust subdivision hereunder is a taxable termination subject to the federal Generation Skipping Transfer Tax, my Trustee may pay that tax from the portion of the property to which the tax relates without any adjustment of the relative interests of the beneficiaries. dd. Termination of Small Trust If at any time after my death the costs of administration of my Trust (or any share thereof) are of such an amount in relation to the then principal and undistributed income of my Trust (or any share thereof) that my Trustee, in my Trustee's discretion, determines that my purposes in establishing my Trust (or any share thereof) would no longer be served, and if my Trustee deems it advisable to distribute the then principal and undistributed income of my Trust (or any share thereof) to the then living beneficiary or beneficiaries and to thereby cause termination of such Trust or share, my Trustee (other than any then current 14-10 . . beneficiary of my Trust) may do so without responsibility on the part of my Trustee. If no such Trustee is then serving, then any Trustee may direct than an Independent Trustee, to serve only for the purpose of determining the advisability of termination process, be appointed pursuant to the Trustee succession provisions of Article Three that would apply if no Trustee were then serving; provided however, than any Trustee who is also such a beneficiary may not othei:wise participate in the appointment process. ee. Power to Subject Trust Property to Probate It is my intention to avoid probate through the use of my Trust. If, however, my Trustee and Personal Representative mutually determine that it shall be in the best interests of the beneficiaries of my Trust, and the beneficial interests of the beneficiaries shall not thereby be altered, my Trustee may subject any asset to probate to accomplish a result unavailable without probate. This power shall be strictly construed and shall only be used to secure any tax or other benefit otherwise unavailable to my Trust. Accordingly, other than a distribution that would cause a Marital or Charitable Deduction to fail, my Trustee, in my Tmstee's discretion, may accomplish this objective by distributing such property to my estate. ff. Power to Change Situs My Tmstee shall have the power, exercisable by a written instrument signed and acknowledged by my Trustee, to change the situs of any trust or trust share held by my Trustee; and, in conjunction with any such change and without any need to obtain the approval of any court, to elect iliat such trust or trust share shall be subject to the jurisdiction of the new situs. In addition, my Trustee may move the assets of such trust or trust share to the location of the new situs. The meaning and effect of the provisions of my Trust Agreement shall be construed in accordance with the laws of the governing state identified in Section 13 of Article Fifteen, but each trust or trust share shall be administered in accordance with the laws of the applicable situs. In no event, however, may this power be exercised in a manner that would cause the denial of Marital Deduction qualification for any portion of my Trust Estate, or that would prevent a trust or trust share from qualifying as a permitted shareholder of S corporation stock for federal income tax purposes. gg. Release of Trustee Pow~rs Each Tmstee who determines itto be in the best interest of any beneficiary may, at any time, by instrument executed with all the formalities of a deed and delivered personally or sent by certified mail to another then acting Trustee, if any, or to some beneficiary of the affected Trust or Trusts, release and relinquish 14-11 or disclaim upon any terms, either in whole or in part, temporarily or permanently, revocably or irrevocably, with or without binding successors, anyone or more of the powers, rights, authorities, and discretions conferred upon such Trustee by any provision or provisions of my Tnlst Agreement or generally pursuant to law, which release and relinquishment or disclaimer shall be binding on all affected beneficiaries. If the release and relinquishment or disclaimer of a power, right, authority, or discretion is made by less than all of the Trustees upon whom it is conferred, such power, right, authority, or discretion shall continue to be exercisable in full by the Trustee or Trustees (other than any successor Trustees on whom it is, by its terms, binding) who have not thus released and relinquished or disclaimed it. hh. Power to Disclaim Retirement Benefits or Other Income In Respect of Decedent ("IRD") If I am survived by my Spouse and if my Trustee. (other than my Spouse) detemlines in my Trustee's discretion, that it is in the best interests of any beneficiary of my Trust or any subdivision thereof, my Trustee may disclaim all or any right to receive any Retirement Benefits or IRD. If my Trustee so disclaims, such disclaimed Retirement Benefits or IRD shall pass outright to my Spouse. If my Spouse is the only Trustee at the relevant time, my Spouse may direct that an Independent Trustee be appointed pursuant to the Trustee succession provisions of Article Three that would apply as if lam survived by my Spouse and no Trustee were then serving, provided, however, that my Spouse may not otherwise participate in the appointment process. 14-12 . ' Article Fifteen General Provisions Section 1. Spendthrift Protection Neither the principal nor the income of any trust created or contained under my Trust Agreement shall be liable for the debts of a beneficiary nor shall the same be subject to seizure by any creditor of any beneficiary under any lien or proceeding at law or equity. Except to the extent otherwise expressly provided in my Trust Agreement, no beneficiary shall have the authority or power to sell, assign, transfer, encumber or in any manner to dispose of a beneficial interest, whether income or principal. The limitations herein shall not restrict the exercise of any power of appointment or the right to disclaim by any beneficiary. In addition, except as to any trust or trust share intended to qualify for the Marital Deduction, and subject to the provisions of Section 2 of this Article, if my Trustee at a time that any distribution to any beneficiary is directed to be made under the provisions of my Trust Agreement, in such Trustee's sole discretion, determines that reliance on government benefits, illness, substance dependency, bankruptcy, litigation or any factor tending to diminish the ability of a beneficiary to fully benefit from a distribution or to handle financial affairs exists, my Trustee may withhold any such directed distribution and may extend the term of my Trust as to any portion of my Trust Estate otherwise allotted for any so affected beneficiary. Thereafter, my Trustee may continue to distribute income or principal to such beneficiary as my Trustee may determine in my Trustee's sole discretion. Ifmy Trustee withholds distributions to prevent a loss of, or ineligibility for, government benefits, the Special Needs Provisions ofthis Article Fifteen shall apply to such trust property. Section 2. The Rule Against Perpetuities Notwithstanding any other provision of my Trust Agreement, lIDless sooner terminated or vested in accordance with other provisions of my Trust Agreement, all interests not otherwise vested, including, but not limited to, all trusts and powers of appointment created hereunder, shall terminate one day prior to twenty-one (21) years after the death of the last survivor of the group composed of me, my Spouse, those beneficiaries described herein and my lineal descendants living on the date of my death. At that time, distribution of all principal and all accrued, accumulated and undistributed income shall be made to the persons (or their representatives as authorized herein) then entitled to distributions of income or principal and in the manner and proportions herein stated irrespective of their then attained ages. 15-1 . ' Section 3. Incapacity and Competency A person shall be considered incapacitated in the event such person has been determined to be so by a court of competent jurisdiction; has been certified by two licensed physicians to be unable to properly handle his or her own affairs by reason of physical illness or mental illness; or otherwise is unable freely to communicate for a period of 90 days. A person shall be considered to have regained capacity upon such a determination by a court of competent jurisdiction, or upon certification by two licensed physicians that the person is able to propt'dy handle his or her own affairs or is able to freely communicate. The term "incapacity" is intended to b~ interchangeable with the terms "disability" and "incompetency". The term "competent" in my Trust Agreement refers to a person who is not incapacitated. Notwithstanding the preceding provisions of this Section, for purposes of administration under Articles Six, Ten and Eleven of my Trust Agreement, the term "incapacitated" also refers to any beneficiary receiving or eligible to receive gavernment benefits. Section 4. Income and Principal Payments Other than as directed in the Special Needs Provisions of this Article, all payments of income or principal shall be made in such of the following ways as my Trustee determines appropriate: .} a. To each respective beneficiary in person upon his or her personal receipt; b. Deposited in any bank to the credit of such beneficiary in any account carried in his or her name or jointly with another or others; c. To the parent or legal representative of the beneficiary; d. To a Custodian under a Uniform Transfers to Minors Act or Uniform Gifts to Minors Act selected by my Trustee for such period of time under applicable law as my Trustee determines appropriate; e. To some near relative, friend or institution having primary responsibility for the care and custody of the beneficiary; f. By my Trustee using such payment directly for the benefit of such beneficiary; or g. To the Trustee of any revocable trust of which the beneficiary is the Trustor. 15-2 Section 5. Limit on Trustee's Discretion Notwithstanding any other provision in my Trust Agreement, other than me and other than my Spouse with respect to a Survivor's Trust, no individual Trustee who is also a beneficiary hereunder ("Trustee-beneficiary") shall have any right, power, duty or discretion concerning my Trust Estate if such right, power, duty or discretion conferred upon such Trustee-beneficiary under my Trust Agreement would constitute a general power of appointment under Code Section 2041 or 2514 that would cause any assets of my Trust Estate to be included in the estate of such Trustee-beneficiary. Any such right, power, duty or discretion with such effect shall be null and void with respect to such Trustee-beneficiary. No Trustee who is under a legal obligation to any beneficiary of my Trust Agreement or other person sh~ll under any circumstances partake in any decisions relating to any discretionary distributions of income or principal of my Trust Estate that can be used to discharge any such legal obligation of such Trustee. If however, such powers may be possessed without violating the restrictions imposed by this Section 5 by either my Trustee jointly with an Independent Trustee, or by an Independent Trustee alone, then my Trustee may appoint an Independent Trustee who may possess those powers and authorities without violathg this Section. Such an Independent Trustee shall act jointly with my Trustee whenever the joint possession of a power or authority would not violate the restrictions imposed by this Section. Such an Independent Trustee shall act alone whenever only sole poss'ession of a power or authority ~ould not violate the restrictions imposed by this Section. Section 6. No-Contest Clause If any person or entity, other than myself, singularly or in conjunction with any other person or entity, directly or indirectly, in any court, contes:, the validity of my Trust Agreement, including any amendments thereto, then the right of that person or entity to take any interest in my Trust Estate or to act in any fiduciary capacity shall cease, and the demise of that person (and his or her descendants) or entity shall be deemed to have occurred prior to mine. Sec,jon 7. Disclaimer by Beneficiary Any beneficiary under my Tmst Agreement shaIl be entitled to disclaim all or any portion of such beneficiary's interest in my Trust. 15-3 Section 8. Captions The captions of Articles, Sections and Paragraphs used in my Trust Agreement are for convenience of reference only and shall have no significance in the construction or interpretation of my Trust Agreement. Section 9. Severability Should any of the provisions of my Trust Agreement be for any reason declared invalid, such invalidity shall not affect any of the other provisions of my Trust Agreement, and all invalid provisions shall be wholly disregarded in interpreting my Trust Agreement. Section 10. Statutory References Unless the context clearly requires another construction, each statutory reference in my Trust Agreement shall be construed to refer to the statutory section mentioned, related successor sections, and corresponding provisions of any subsequent law, including all amendments. Section 1LSurvivorship a. Simultaneous Deaths For purposes of my Trust Agreement, if my Spouse and I die under circumstances in which the order of our deaths cannot be established, Husband Trustor shall be deemed to have predeceased Wife Trustor. If any beneficiary under my Trust Agreement, other than my Spouse, dies under circumstances in which the order of deaths cannot be established, I shall be deemed to have survived the beneficiary, and my Trust Agreement shall be construed accordingly. b. Generation Skipping Transfer Tax Matters A person (the "Non-Skip Person") shall not be deemed to have been alive on the date of the death of any person upon whose death a transfer is deemed to occur for Generation Skipping Transfer Tax purposes or the date of any distribution from or any termination of any interest in any trust or share under my Trust Agreement for which the date of the Non-Skip Person's death is relevant ("the Transfer Date") if: (a) the Non-Skip Person is actually alive on the Transfer Date; (b) the Non-Skip Person is not actually alive on the date ninety (90) days 15-4 following the Transfer Date; and (c) the existence of such a condition of survivorship causes another person who would otherwise be assigned to a generation below that of the Non-Skip Person to be assigned to the generation of the Non-Skip Person for Generation Skipping Transfer Tax purposes. Section 12. Gender and Number In my Trust Agreement, where appropriate, except where the context otherwise requires, the singular includes the plural and vice versa, and words of any gender shall not be limited to that gender. Section 13. Governing Commomvealth Law My Trust Agreement and the trusts created under it shall be construed, regulated and governed by and in accordance with the laws of the Commonwealth of Pennsylvania. Section 14. Reliance on Certificate (or Memorandum) of Trust Any person may act in reliance upon a properly issued certificate (or Memorandum) of trust reflecting the relevant terms of my Trust AgI'eenieht without risk of incurring any liability to the Trustor, Trustees or beneficiaries of my Trust. Section 15. Definitions The following terms as used in my Trust Agreement are defined as indicated: a. Beneficiary Designation The term "Beneficiary Designation" means any document executed by me which affects the manner of payment of amounts held in a plan (of whatever type) subject to the distribution rules of section 40 I (a)(9) of the Code or any commercial annuity or any similar deferred payment arrangement. b. Child, Children, Issue and Descendants The terms "child" or "children" mean lawful blood descendants in the first degree of the parent designated; and "issue" and "descendants" mean the lawful blood. descendants in any degree of the ancestor designated; provided, however, that if a person has been adopted, that person shall be considered a child of such 15-5 adopting parent or parents, and such adopted child and his or her issue shall be considered issue of the adopting parent or patents and of anyone who is by blood or adoption an ancestor of the adopting parent or either of the adopting parents. The terms "child," "children," "issue," "descendant" and "descendants" or those terms preceded by the terms "living" or "then living" shall include the lawful blood descendant in the appropriate degree of the ancestor designated even though such descendant is born after the death of a parent. Notwithstanding the preceding provisions of this Section I5.b, the terms of Article One exclude certain descendants from being treated as such by restricting the availability of Trust benefits. c. Code The term "Code" means the Internal Revenue Code of 1986, as amended from time to time. The terms "Income in Respect of a Decedent", "Gross Estate", "Taxable Estate", "Applicable Credit Amount", "State Death Tax Credit", "Credit for Prior Transfers", "Marital Deduction", "Exclusion", "Disclaimer" and any other terms that, from the context in which they are used, refer to the Code shall have the same meaning as such terms have for the purposes of applying the Code to my Trust Agreement. d. Deceased Trustor The term "Deceased Trustor" means a Trustor who has died. e. Death Taxes The term "Death Taxes" means all inheritance, estate, succession and other similar taxes that are payable by any person on account of that person's interest in the estate of the decdent or by reason of the decedent's death, including penalties and interest but excluding the following: 1. Any additional tax that may be assessed under Internal Revenue Code Section 2032A and 2033A; and 2. Any federal or state tax imposed on a Generation Skipping Transfer, as that term is defined in the federal tax laws, unless that Generation Skipping Transfer Tax is payable directly out of the assets of a trust created by my Trust Agreement. 15-6 f. Education The term "education" shall be given broad interpretation and may include but not be limited to: 1. High School Education at public or private elementary or high schools, including boarding schools. 2. College Undergraduate and graduate study in any and all fields whatsoever, whether of a professional character in colleges or other institutions of higher learning. 3. Specialized Training Specialized formal or informal trammg in music, the stage, handicrafts, the arts, or vocational or trade schools, whether by private instruction or otherwise. 4. Othel'Educational Activities Any other activity including foreign or domestic travel that shall tend to develop fully the talents and potentialities of each beneficiary regardless of age. g. Heirs at Law References to someone's "heirs at law" mean individuals who are living at the event when property is directed to be distributed to them. Those individuals' identities and the shares of the distributable property that they each receive shall be determined under the intestacy laws of the Commonwealth of Pennsylvania which then govern the distribution of the personal property of a resident dying then, without creditors, owning only the distributable assets. h. Independent Trustee The term "Independent Trustee" means a Trustee who is an independent person who, within the meaning of Code section 672(c), is not related or subordinate to any beneficiary of my Trust. 15-7 .' i. Personal Representative The term "Personal Representative" means trustee, executor, executrix, administrator, administratrix, conservator, guardian, custodian or any other type of personal representation. j. Per Stirpes In every case in which a disposition of an interest is to be made to the issue of a person "per stirpes," it is intended that such disposition shall be made in accordance with the principle of representation. This pril:ciple in relation to my Trust Agreement means that whenever property is to be distributed to the issue of a person, such property shall be djvided into as many shares as there are, at the time of disposition, living issue in the nearest degree of kinship to such person and then deceased issue in the same degree who left issue who are then living; each then living issue in the nearest degree receiving one share, and the share of each then deceased issue in the same degree being divided among his or her issue in the same manner. k. Retirement Account/Retirement Benefits The terms "Retirement Account" or "Retirement Benefits" mean any deferred payment account, whether or not considered a 'lualified plan under sections 401, 403, 408 or any other section of the Code, under which by reason of fiduciary accounting principles income is considered earned but not immediately payable, I. Retirement Account Trustee 1. For purposes of receiving any Retirement Benefits, the Trustees of the Family Trust and Survivor's Trust may be referred to by the term "Retirement Account Trustee". If there is more than one Tmstee serving as Trustee of either or both the Family Tmst and the Survivor's Trust, then for purposes of my Tmst Agreement, all such Trustees shall be included in the term "Retirement Account Trustee". This defmition of Retirement Account Trustee is intended to provide an efficient means to utilize a Beneficiary Designation to indicate the beneficiary of any Retirement Account benefits. 2, The Trustees of the Family Trust and the Survivor's Tmst (collectively lmown, and previously referred to, as the "Retirement Account Tmstee") shall divide all Retirement Account balances (the "Balance"), or rights thereto, between 15-8 the Family Trust and the Survivor's Trust in accordance with the fractional fonnula division of income in respect of a decedent set out in Article Six; however, relative to such fonnula: (i) only property affected by a Beneficiary Designation shall comprise the denominator of the fraction; and, (ii) any such division of the Balance shall be detennined only after taking into account the other fractional fonnula allocations directed under Article Six. 3. This Retirement Account Trustee arrangement is intended, and shall be interpreted for all purposes, to comply with the applicable requirements of the Code and Treasury Regulations, to obtain treatment of trusts and trust beneficiaries as Designated Beneficiaries under Code section 401 (a)(9), as amended. m. Trust Estate The tenn "Trust Estate" means all of the property, real and personal, intangible and tangible, that has been transferred to my Trustee, whether or not listed on any Schedules. n. Trustee's Discretion The tenn "discretion" with regard to a Trustee means such Trustee's sole but reasonable judgment. In exercising any discretionary power with respect to my Trust, my Tnlstee shall at all times act in accordance with fiduciary principles and shall act reasonably under the circumstances and not in bad faith or in disregard of the purposes of my Trust. o. Trustor The tenn "Trustor" shall be interchangeable with the tenns "settlor", "grantor", "donor" or other similar tenns. p. Unused Generation Skipping Tax Exemption Eqnivalent The tenn "Unused Generation Skipping Tax Exemption Equivalent" means the Generation Skipping Transfer Tax exemption provided in section 2631 of the Code in effect at the time of death of a Tnlstor, reduced by the aggregate of (1) the amount, if any, of such exemption allocated by such Trustor or by operation of law to such Trustor's lifetime transfers and (2) the amount, if any,. such Trustor 15-9 . . or such Trustor's Personal Representative or Trustee has specifically allocated to property other than property to which such exemption is directed to be allocated by any applicable provision of my Trust Agreement. For purposes of my Trust Agreement, if at the time of death of a Trustor such Trustor has made lifetime transfers of property to which an inclusion ratio of greater than zero would be applicable and for which the gift tax return due date has not expired (including extensions) and a return has not yet.been filed, it shall be deemed that the generation skipping transfer exemption has been allocated to such transfers to the extent necessary and possible to exempt such transfers from Generation Skipping Transfer Tax. q. Unused Applicable Credit Equivalent The term "Unused Applicable Credit Equivalent" means that value of a Deceased Trustor's taxable estate determined without regard to the Marital Deduction that can be transferred at death without causing any federal estate tax liability because of: 1. Any available Applicable Credit Amount (Unified Credit), 2. The Credit for State Death Tax to the extent it does not increase the amount of death taxes payable to any state, 3. The Credit for Prior Transfers, 4. Allowable Exclusions from the Gross Estate, and that is in excess of the net value of all property includable in the taxable estate of a Deceased Trustor that does not qualify for the Marital Deduction or any other deduction; whether that value passes outside of my Trust (by way of joint tenancy, life insurance contract, Beneficiary Designation, will, or otherwise) or under other provisions of my Trust. Section 16. Qualified Domestic Trust Provisions When applicable as directed by Article Eight and in addition to the other provisions of Article Eight, my Trustee shall hold, administer and distribute the assets of the Survivor's Trust as follows in accordance with the following "Qualified Domestic Trust Provisions" of this Section 16: 15-10 . ' a. Qualified Domestic Trust It is my intention that the Survivor's Trust shall meet all requirements for a Qualified Domestic Trust under the Code as existing at the date of my death, and any regulations promulgated thereunder. My Trust Agreement shall automatically reform any terms, powers or rights to ensure that the Survivor's Trust qualifies under Code Section 2056A and regulations thereunder. In addition, however, if at my death my Spouse is, or subsequent thereto becomes a citizen of the United States or the law governing qualification of Qualified Domestic Trusts does not require application orall the restrictions placed on the Survivor's Trust under this Section 16, the Domestic Trustee other than my Spouse is authorized to amend the Survivor's Trust to remove any restrictions that become unnecessary for Marital Deduction qualification. b. Requirements for Security Arrangements My Domestic Trustee ("Trustee") shall comply with the requirements for security arrangements for Qualified Domestic Trusts as set forth in Treas. Reg, ~20.2056A-2(d)(1)(i) or (ii), summarized as follows: 1. Trust in Excess of $2 Million If the fair market value of the. assets passing to the Survivor's Trust (determined without reduction for any indebtedness thereon) exceeds $2 million on the relevant valuation date, then my Trustee must at all times during the term of the trust either satisfy the U, S, Bank as Trustee requirement (see Treas. Reg. ~20,2056A- 2(d)(I)(i)(A)), or furnish a bond that satisfied the requirements of Treas. Reg. ~20.2056A-2(d)(1)(i)(B), or furnish an irrevocable letter of credit that satisfies the requirements of Treas, Reg, ~20.2056A-2(d)(1)(i)(C), (hereinafter referred to as the U.S. Bank, Bond, or Letter of Credit Requirement). My Trustee may alternate between any of the security arrangements described in the preceding sentence provided that, at all times during the term of my trust, one of the arrangements is operative, If my Trustee elects to furnish a bond or letter of credit as security, then in the event the Internal Revenue Service draws Oil the instrument in accordance with its terms, neither my Trustee nor any other person will seek a return of any part of the remittance until after April 15th of the calendar year following the year in which the bond or letter of credit is drawn upon. 15-11 .' 2. Trust of $2 Million or Less If the fair market value of the assets passing to the Survivor's Trust (determined without reduction for any indebtedness) is $2 million or less on the relevant valuation date, then my Trustee must comply with either the U . S. Bank, Bond, or Letter of Credit Requirement only if more than 35 % of the fair market value of the assets of the Survivor's Trust, determined annually on the last day of the taxable year of my Trust, consists of real property located outside the United States. For purposes of determining whether more than 35% of the assets of the Survivor's Trust consist of foreign real property, Treas. Reg. ~20.2056A-2(d)(I)(ii)(B) applies. 3. Determination of Value For purposes of determining whether the fair market value of the trust assets exceeds $2 million, my Trustee is authorized to make the election under Treas. Reg. ~20.2056A-2(d)(I)(iv)(A) with respect to real property used as my Spouse's personal residence. 4. Amount of Bond or Letter of Credit For purposes of determining the amount of the bond or letter of credit, my Trustee is authorized to make the election under Treas, Reg. ~20.2056A-2(d)(1)(iv)(B) with respect to real property used as my Spouse's personal residence. 5. Annual Statements My Trustee is directed to file any annual statements required under Treas. Reg. ~20.2056A-2(d)(3). 6. General Conduct Notwithstanding anything contained herein to the contrary, my Trustee (described in Section 16.c of this Article) is hereby authorized to enter into alternative plans or arrangements with the Internal Revenue Service pursuant to Treas. Reg. ~20.2056A- 2(d)(4) to ensure collection of the deferred estate tax, in lieu of the provisions contained herein. 15-12 . . 7. References All references to "Treas. Reg." in this document shall be references to regulations published under 26 CFR as in effect on the date of execution of this document, or, in the event that any . such regulation is amended or superseded thereafter, to the regulation (or any successor regulation) as so amended. 8. Dollar Values The use of the dollar sign ($) shall indicate amounts stated in U. S. dollars. c. Domestic Trustee Notwithstanding any other provision of my Trust, at least OlJ~ of the Trustees of the Survivor's Trust shall be an individual citizen of the United States or a domestic United States corporation. No Successor Trustee hereunder shall qualify to act as such unless the foregoing requirements have been met. The method of appointment of Domestic Trustee(s) of the Survivor's Trust is provided in Article Three of my Trust Agreement. d. Location-of Documents of Title All documents of title to any assets held by the Survivor's Trust shall be located, held and administered in the United States by the Domestic Trustee. e. Payment of Tax In addition to payment of estate tax upon the death of my Spouse, my Domestic Trustee shall have the right to withhold from any distribution the tax imposed upon such distribution from the Survivor's Trust under Code Section 2056A and upon the cessation of the qualification of the Survivor's Trust as a Qualified Domestic Trust under Code Section 205M.. Section 17. Special Needs Provisions a. Overall Limitation on Distribution It is my intention that the assets of my Trust Estate supplement but not supplant, impair or diminish any then existing forms of support 'or benefit which the beneficiary is receiving or becomes eligible to receive. For purposes of this Section, the term "support" means food, clothing or shelter. The terms of my 15-13 Trust Agreement shall be read and interpreted to prevent any action by my Trustee which would supplant, impair, diminish or otherwise interfere with; limit or reduce the beneficiary's receipt of, or eligibility for any form of government or private benefits. Any power of distribution (whether or not exercised), granted my Trustee pursuant to the terms of my Trust Agreement, that would result in the loss, diminishment or ineligibility for government or private benefits, is hereby revoked; and, only such powers as will not result in ineligibility for such benefits, or loss, diminishment or impairment, thereof, shall remain exercisable by my Trustee. b. Special Needs For purposes of my Trust Agreement, the term "Special Needs' refers to supplemental, non-support expenditures from my Trust's assets that, pursuant to the other provisions of this Section, my Trustee is authorized to disburse, in my Trustee's sole and absolute discretion. Special Needs, subject to the general supplemental, non-support limitation, include, but are not limited to, medical, dental, diagnostic or therapeutic treatment, or nursing or home care services for which the beneficiary is not receiving government or private benefits and is not eligible to receive. Special Needs also includes the differential between any treatment, service or care that the beneficiary is receiving from any government or private source and the level of treatment, service or care my Trustee deems appropriate for the beneficiary.. Disbursements for education, travel (including travel by those my Trustee believes the companionship of which will benefit the beneficiary), entertainment devices or events and electronic devices are also to be considered Special Needs. c. Distribution of Income or Principal 1. Distributions for Special Needs Subject to the provisions of Section 17.a of this Article that prohibit my Trustee from making any distribution which would supplant, impair or diminish government or private benefits, or cause the beneficiary to be ineligible for such benefits, as determined in my Trustee's sole and absolute discretion, my Trustee may distribute such amounts of income or principal for the Special Needs of the beneficiary. My Trustee may act arbitrarily and without regard to any statutes or other rules of law in refusing to disburse trust assets. No distributions may be made to the beneficiary. Any distributions made shall be made to the goods or services provider. 15-14 . . 2. Accumulated Inco.me Any income not distributed shall be accumulated and added to principal. 3. Reso.urces o.f the Beneficiary My Trustee, in exercising discretion under this Section, shall consider all income or resources available to the beneficiary. The beneficiary has no rights to any distributions ,mder my Trust 4. Treatment o.f Any Residence Held by My Trust My Trustee may charge the beneficiary rental on any residence owned by my Trust. My Trustee must charge rent if the failure to do so would impair, diminish, or cause ineligibility for, any government or private benefits. n 5. _ . BightsnfCreditars alld-Gihers- My Trust assets are not intended to be used for the support of the beneficiary, but are only intended to supplement, in my Trustee's sole and absolute discretion, resources, income or g()veEJ11l1enL9X pfiVa:te"asSlsfanceavail<ible to the beneficiiiy. . No part of my Trust Estate, neither principal nor income, shall be subject to anticipation or assignment by the beneficiary, nor be subject to attachment by any creditor of the beneficiary, governmental agencies or any other individual or entity; including any who may have provided goods or services to the beneficiary. 6. Po.wer to. Terminate My Trust If my Trustee deems it necessary to terminate my Trust to avoid impairing or diminishing the beneficiary's receipt of government or private benefits, or becoming ineligible for such benefits, my Trustee, in my Trustee's sole and absolute discretion, shall terminate my Trust If my Trustee terminates my Trust, the assets of my Trust shall be held, administered and distributed pursuant to Section 17.c.? of this Article as though the beneficiary had died. We request, but do not require, that the remainder beneficiaries consider the purposes of my Trust in expending the property they receive. 15-15 . . 7. Distributions on Death of Beneficiary Unless provided otherwise under the provisions of preceding Articles, if the beneficiary dies while my Trustee still holds trust assets, my Trust shall terminate and my Trustee shall distribute the balance of my Trust Estate to the beneficiary's then living descendants, per stirpes. If the beneficiary has no then living descendants, my Trustee shall distribute the balance of my Trust Estate to my then living descendants, per stirpes. If we have no then living descendants, my Trustee shall diStribute the balance of my Trust as provided in Article Twelve of my Trust Agreement. . Subject to the other provisions of this Section, my Trustee may pay for the expenses of the beneficiary's last illness and funeral. I have executed my Trust Agreement on the . date set forth on the first page of IllY Trust Agreement. I certify that I understand my Trust Agreement and that it correctly states the terms and coffi!inonsimderwmch my-TfuSt-ESfiite is t6oelie1Q;m~nagea-affiidisposed ofDy my Trustee. I approve this revocable living trust in all particulars and request my Trustee to execute it. Trustor~ t~c-~/-.$ HOWARD A. THORNHILL A/KJA H.A.THORNHILL :~~ HOWARD A. THORNHILL A/KJA H.A.THORNHILL ~... >>-.... 1',," . ~ L U AGATHA JANE THORNHILL "-- 15-16 -'-'--- ---'---~"_-------,-_._,--~._-~._-,----_.__.--- - -. ~- -~ ., ( COMM:ONWEALTH OF PENNSYLVANIA ) ) SS COUNTY OF DAUPHIN On this JUlO81999 , before me, tNM L. k11n-tftJPF , the undersigned officer, personally appeared HOWARD A. THORNHILL AIKIA H. A. THORNHILL, Trustor and Trustee, known to me (or satisfactorily proven) to be the person whose name is subscribed to the within instrument and acknowledged that he executed the same for the purposes therein contained. In witness whereof I hereunto set my hand and official seal. ~dJ., t ~ N PubliC". .... L Not~rl~I Seal Inda L Fetterhoff Nota M Derry Twp.. Dauphin cry Public Y Commission Expires. No~u~~ 999 1m ef, ennsy Vilma SSOI;:(!I 6R 6 COMM:ONWEALTH OF PENNSYLVANIA ) IItt SS COUNTY OF DAUPHIN ) ontllls.JlJtOc~H999' , before me, l'~TM i.. ;;'(l:I:~ff , the undersigned officer, personally appeared AGATHA JANE THORNHILL, Trustee, known to me (or satisfactorily proven) to be the person whose name is subscooed to the within instrument and acknowledged that she executed the same for the purposes therein contained. In witness whereof I hereunto set my hand and official seal. l~ ,t .J.tIUJJfjJ No Public Notarial Seal Linda L. Fetterhoff. Notary Public Derry Twp., Dauphin County My CommissIon ExpIres Nov. e, 1999 em er, ennsy vaniit- 'sce at art r II '-- 15-17