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Trust Agreement Under Supplemental Executive Retirement Program DC, Amended

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Sectors: Transportation
Governing Law: Delaware, View Delaware State Laws
Effective Date: November 17, 2008
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TRUST AGREEMENT

UNDER

SUPPLEMENTAL EXECUTIVE RETIREMENT PROGRAM

FOR OFFICERS OF AMERICAN AIRLINES, INC.

PARTICIPATING IN THE $UPER $AVER PLUS PLAN



Amended and Restated effective June 1, 2007

ARTICLE I





DAL02:442056.6

003154.0122














TABLE OF CONTENTS






ARTICLE I DEFINITIONS [INSERT PAGE NUMBER]

Section 1.1. Account [INSERT PAGE NUMBER]
Section 1.2. Actuary [INSERT PAGE NUMBER]
Section 1.3. Beneficiary [INSERT PAGE NUMBER]
Section 1.4. Code [INSERT PAGE NUMBER]
Section 1.5. Committee [INSERT PAGE NUMBER]
Section 1.6. Compensation Committee [INSERT PAGE NUMBER]
Section 1.7. Corporation [INSERT PAGE NUMBER]
Section 1.8. Expense Account [INSERT PAGE NUMBER]
Section 1.9. Fund [INSERT PAGE NUMBER]
Section 1.10.Investment Manager [INSERT PAGE NUMBER]
Section 1.11.Participant [INSERT PAGE NUMBER]
Section 1.12.Plan [INSERT PAGE NUMBER]
Section 1.13.$uper $aver Plus Plan [INSERT PAGE NUMBER]
Section 1.14.Trust [INSERT PAGE NUMBER]
Section 1.15.Trustee [INSERT PAGE NUMBER]
Section 1.16.Valuation Date [INSERT PAGE NUMBER]




ARTICLE II CREATION, PURPOSE AND ADMINISTRATION OF THE TRUST [INSERT PAGE NUMBER]

Section 2.1. Purpose of the Trust; Separate Trust [INSERT PAGE NUMBER]
Section 2.2. Administration of the Trust [INSERT PAGE NUMBER]
Section 2.3. Irrevocable; Not Subject to Creditor Claims [INSERT PAGE NUMBER]
Section 2.4. Secured Interest; Separate Account [INSERT PAGE NUMBER]




ARTICLE III ACCOUNTS [INSERT PAGE NUMBER]

Section 3.1. Fund and Accounts. [INSERT PAGE NUMBER]
Section 3.2. Written Certifications Provided by Corporation to the Trustee [INSERT PAGE NUMBER]
Section 3.3. Benefits Payable [INSERT PAGE NUMBER]
Section 3.4. Account Adjustment [INSERT PAGE NUMBER]
Section 3.5. Maintenance of Accounts [INSERT PAGE NUMBER]
Section 3.6. Taxability of the Trust and the Participants [INSERT PAGE NUMBER]
Section 3.7. Accumulation/Distribution of Trust Income [INSERT PAGE NUMBER]
Section 3.8. Contributions by the Corporation for Income Taxes [INSERT PAGE NUMBER]




ARTICLE IV CONTRIBUTIONS, CERTIFICATIONS AND DISTRIBUTIONS [INSERT PAGE NUMBER]

Section 4.1. Contributions to the Trust [INSERT PAGE NUMBER]
Section 4.2. Provision of Benefits is Binding Obligation of Corporation [INSERT PAGE NUMBER]
Section 4.3. Provision of Reports and Written Certifications by the Corporation to the Trustee [INSERT PAGE NUMBER]
Section 4.4. Distributions to Participants [INSERT PAGE NUMBER]




ARTICLE V ACTUARY [INSERT PAGE NUMBER]

Section 5.1. Determination of Corporation's Fund Contributions by Actuary [INSERT PAGE NUMBER]
Section 5.2. Resignation/Removal of Actuary [INSERT PAGE NUMBER]




ARTICLE VI INVESTMENTS AND POWERS OF THE TRUSTEE [INSERT PAGE NUMBER]

Section 6.1. Fund Held in Trust [INSERT PAGE NUMBER]
Section 6.2. Types of Investments [INSERT PAGE NUMBER]
Section 6.3. Powers and Authority of Trustee [INSERT PAGE NUMBER]
Section 6.4. Investment of Fund by Investment Manager [INSERT PAGE NUMBER]
Section 6.5. Making Benefit Payments [INSERT PAGE NUMBER]
Section 6.6. Deposit of Contributions by Trustee [INSERT PAGE NUMBER]
Section 6.7. Dealings with the Trustee [INSERT PAGE NUMBER]
Section 6.8. Use of Fund Assets to Pay Trust Expenses [INSERT PAGE NUMBER]




ARTICLE VII DUTIES OF THE TRUSTEE [INSERT PAGE NUMBER]

Section 7.1. General Duties of the Trustee [INSERT PAGE NUMBER]
Section 7.2. Valuation of Fund [INSERT PAGE NUMBER]
Section 7.3. Reports and Records [INSERT PAGE NUMBER]
Section 7.4. No Duty to Advance Funds or to Administer the Plan [INSERT PAGE NUMBER]
Section 7.5. Resignation/Removal of Trustee [INSERT PAGE NUMBER]




ARTICLE VIII COMPENSATION, IMMUNITIES AND INDEMNITY OF THE TRUSTEE [INSERT PAGE NUMBER]

Section 8.1. Trustee Compensation and Expenses [INSERT PAGE NUMBER]
Section 8.2. Expense Account [INSERT PAGE NUMBER]
Section 8.3. Immunities [INSERT PAGE NUMBER]
Section 8.4. Indemnity of the Trustee. [INSERT PAGE NUMBER]
Section 8.5. Determination of Interests in the Fund; Enforcement of Trust and Legal Proceedings [INSERT PAGE NUMBER]




ARTICLE IX AMENDMENT AND TERMINATION OF THE TRUST [INSERT PAGE NUMBER]

Section 9.1. Amendment of Agreement [INSERT PAGE NUMBER]
Section 9.2. Termination of Agreement [INSERT PAGE NUMBER]




ARTICLE X THE COMMITTEE [INSERT PAGE NUMBER]

Section 10.1.Membership and Actions of the Committee [INSERT PAGE NUMBER]
Section 10.2.Committee Compensation and Expenses [INSERT PAGE NUMBER]
Section 10.3.Indemnity of Committee [INSERT PAGE NUMBER]




ARTICLE XI MISCELLANEOUS [INSERT PAGE NUMBER]

Section 11.1.Governing Law [INSERT PAGE NUMBER]
Section 11.2.No Effect on Employment [INSERT PAGE NUMBER]
Section 11.3.Successors [INSERT PAGE NUMBER]
Section 11.4.Severability [INSERT PAGE NUMBER]
Section 11.5.Incorporation of Plan as Part of Agreement [INSERT PAGE NUMBER]
Section 11.6.Execution in Counterparts [INSERT PAGE NUMBER]
Section 11.7.Effect of Divisions and Captions [INSERT PAGE NUMBER]
Section 11.8.Gender and Number [INSERT PAGE NUMBER]
Section 11.9.Mistake of Fact [INSERT PAGE NUMBER]



ARTICLE I


















TRUST AGREEMENT

UNDER

SUPPLEMENTAL EXECUTIVE RETIREMENT PROGRAM

FOR OFFICERS OF AMERICAN AIRLINES, INC.

PARTICIPATING IN THE $UPER $AVER PLUS PLAN



THIS AGREEMENT (the or this "Agreement") was made and adopted effective as of the 15th day of September, 2005, by and between AMERICAN AIRLINES, INC. (the "Corporation"), a corporation organized and existing under the laws of the State of Delaware, and WACHOVIA BANK, NATIONAL ASSOCIATION (the "Trustee"), a national association organized and existing under the laws of the United States, and the individuals constituting the Committee described in Section 10.1 (the "Committee"). By this instrument, the Corporation hereby amends and restates the Agreement in the entirety, effective as of June 1, 2007 (the "Effective Date").



RECITALS



WHEREAS , in January 1985, the Board of Directors of AMR Corporation established the Supplemental Executive Retirement Program for Officers of American Airlines, Inc., as subsequently amended (the "Plan"), for the purpose of paying retirement benefits to certain officers of the Corporation who are participants in the Plan (the "Participants"), and the Plan was subsequently amended to provide retirement benefits to certain officers of the Corporation who are participants in the Plan (the "Participants") and in the $uper $aver Plus Plan (the "$uper $aver Plus Plan"); and



WHEREAS , the Corporation has established an irrevocable trust to fund certain retirement benefits of the Participants of the Plan who are participants in the $uper $aver Plus Plan; and



WHEREAS , the Corporation desires the Trustee to continue to undertake the responsibility for the protection and conservation of the assets of the Trust, under the terms of the Agreement; the Trustee is willing to continue such responsibility, and the Corporation has delivered assets to the Trustee to hold in trust for the purpose of accumulating funds to pay benefits under the Plan as they become due and payable; and



WHEREAS , the Corporation desires that the Committee under the Plan be responsible for the administration of the Trust, and the Committee has undertaken the responsibility and duties of the Committee pursuant to the terms of the Agreement; and



WHEREAS , the Corporation intends the Trust to operate as a secular trust for Federal income tax purposes, whereby the Participants will be subject to current taxation on the funds held in the Trust; and



WHEREAS , the trust established by this Agreement is not intended to be a "grantor trust" pursuant to sections 671 through 679 of the Internal Revenue Code of 1986, as amended (the "Code"), but is intended to be a taxable trust pursuant to section 641 et seq . of the Code; and



WHEREAS , subsequently to the Effective Date, Revenue Ruling 2007-48 has been issued by the U.S. Treasury Department, and the Corporation desires to update the Agreement so that the Trust continues to operate as a secular trust for Federal income tax purposes;



NOW, THEREFORE , in consideration of the mutual covenants contained herein, the Corporation, the Trustee and the Committee hereby amend and restate the Agreement in the entirety, to provide as follows:



ARTICLE I



DEFINITIONS



Each word or phrase used herein which is in quotations shall have the meaning set forth in this Article I, unless a different meaning is clearly required by context.



Section 1.1. Account . "Account" means the separate account established and maintained under the Fund with respect to each Participant to provide a source of funds for the benefits payable by the Corporation to, or with respect to, each such Participant under the Plan who is also a participant under the $uper $aver Plus Plan.



Section 1.2. Actuary . "Actuary" means the then acting actuary or firm of actuaries employed by the Corporation to advise the Corporation with respect to contributions to be made under the Plan. The initial Actuary shall be Towers, Perrin, Forster & Crosby, Inc. and Subsidiaries.



Section 1.3. Beneficiary . "Beneficiary" holds the identical definition of the term as defined in the Plan.



Section 1.4. Code . "Code" means the Internal Revenue Code of 1986, as amended.



Section 1.5. Committee . "Committee" means the committee of persons to whom the Corporation has delegated the responsibility of the Trust's administration.



Section 1.6. Compensation Committee . "Compensation Committee" means the compensation committee of the Board of Directors of AMR Corporation.



Section 1.7. Corporation . "Corporation" means American Airlines, Inc. and any successor thereto, or to the business thereof, by whatever form or manner resulting.



Section 1.8. Expense Account . "Expense Account" means a separate account of the Fund whereby the Corporation may make contributions to be utilized by the Trustee to pay the compensation, fees and expenses of the Trustee and the Committee and other expenses of the Trust.



Section 1.9. Fund . "Fund" means the money and property held by the Trustee under this Agreement.



Section 1.10. Investment Manager . "Investment Manager" means the then acting manager of all or any of the assets of the Fund that is appointed by the Committee to exercise investment responsibility with respect to all or such portion of the Fund as determined by the Committee.



Section 1.11. Participant . "Participant" means an "Active Funding Participant ? in the Plan (as defined at Section 2.1(b) of the Plan) who is a Participant in the $uper $aver Plus Plan.



Section 1.12. Plan . "Plan" means the Supplemental Executive Retirement Program for Officers of American Airlines, Inc. originally effective January 1, 1985, and as amended from time to time, including certain retirement benefits heretofore authorized and which may hereafter be authorized to be payable to certain employees of the Corporation.



Section 1.13. $uper $aver Plus Plan . ?$uper $aver Plus Plan" means Supplement 9 of the $uper $aver A 401(k) Capital Accumulation Plan for Employees of Participating AMR Corporation Subsidiaries originally effective July 1, 1988, and as amended from time to time.



Section 1.14. Trust . "Trust ? means the trust provided for under this Agreement.



Section 1.15. Trustee . "Trustee" means the then acting trustee of the Trust. The initial trustee of the Trust is Wachovia Bank, National Association.



Section 1.16. Valuation Date . "Valuation Date" means (i) the last business day of each calendar quarter; (ii) in the case of a Participant who retires or whose employment with the Corporation is terminated for any reason, the last business day of the calendar month coincident with or immediately preceding the date of such retirement or termination; and (iii) each other date or dates specified by the Committee to the Trustee for the valuation of the Fund and adjustment of Accounts.



ARTICLE II



CREATION, PURPOSE AND



ADMINISTRATION OF THE TRUST



Section 2.1. Purpose of the Trust; Separate Trust . This Trust is established by the Corporation, the Trustee and the Committee for the purpose of accumulating funds to pay benefits under the Plan. Payments from the Fund to Participants or their Beneficiaries shall be in discharge of the Corporation's liability under the terms of the Plan to such Participants, to the extent such benefits are paid from the Fund. The Corporation intends that each Account established pursuant to Article III be treated as a separate trust designed to satisfy, in whole or in part, the Corporation's liability under the Plan to each Participant with respect to whom such Account is maintained.



Section 2.2. Administration of the Trust . The Committee shall be solely responsible for the administration of the Trust. The Committee shall, upon request of the Trustee, furnish the Trustee with such reasonable information as is necessary or appropriate for the Trustee to carry out its responsibilities under this Agreement, and the Trustee shall be entitled to rely conclusively on the information received from the Committee. The Corporation shall be responsible for the administration of the Plan. The Corporation shall, upon request of either the Committee or the Trustee, furnish each of the Committee and the Trustee with such reasonable information as each of the Committee or the Trustee shall deem necessary or appropriate to carry out the intent and purposes of the Trust, and each of the Committee and the Trustee shall be entitled to rely conclusively on the information received from the Corporation, unless, in the case of the Trustee, the Committee has informed the Trustee in writing not to rely on such information.



Section 2.3. Irrevocable; Not Subject to Creditor Claims . Subject to the provisions of Section 9.2 hereof, this Trust shall be irrevocable. In addition, the Fund shall not be subject to the claims of the creditors of the Corporation in a bankruptcy or other insolvency proceeding under Federal or state law, but shall be maintained for the exclusive purpose of providing benefits to Participants under the Plan who are participants in the $uper $aver Plus Plan. The right to receive benefits under the Plan through this Agreement may not be anticipated, alienated, sold, transferred, assigned, pledged, encumbered or subjected to any charge or legal process, and the non-alienation provisions of Sections 8.1 and 8.2 of the Plan are hereby incorporated in the entirety by this reference.



Section 2.4. Secured Interest; Separate Account . Each Participant shall have a secured interest in the Account maintained in the Fund with respect to the benefits payable under the Plan. Each Participant' s Account will be maintained as a "separate account" within the meaning of section 404(a)(5) of the Code. The Corporation agrees that during the existence of the Trust, the Corporation shall not permit or cause, or amend this Agreement to permit or cause, the Fund, or any part thereof, to be used for or diverted to purposes other than the payment of benefits under the Plan for Participants and their Beneficiaries.



ARTICLE III



ACCOUNTS



Section 3.1. Fund and Accounts .



(a) The Fund under this Trust shall consist of such sums of money or other property (and the earnings thereon) as shall from time to time be paid or delivered to the Trustee and held by it pursuant to the terms of this Agreement.



(b) Contributions to the Trust with respect to the benefits of Participants shall be credited to Accounts as provided in Section 3.4. At the time the Corporation makes an initial contribution to the Trust with respect to the benefits of a Participant, it shall notify the Trustee of such fact and an Account shall be established by the Trustee under the Fund. The Corporation shall provide the Trustee with such information or reports as are necessary to credit contributions to the Account maintained with respect to each Participant in accordance with Section 4.3 hereof.



Section 3.2. Written Certifications Provided by Corporation to the Trustee . Subject to this Section 3.2, the Trustee shall have responsibility for the maintenance of Account records, including, without limitation, the responsibility for making determinations regarding the adjustment of such Accounts under Section 3.4 hereof. The Corporation shall provide the Trustee from time to time, but not less frequently than annually, with written certifications pursuant to Section 4.3 hereof concerning the amount and form of benefits payable to each Participant under the Plan and the time or times when such benefits shall become payable. Each such certification shall state that it is made in accordance with the terms of the Plan, is binding on the Trustee, and may not be modified, amended or rescinded in any manner whatsoever, except by a subsequent certification which complies with the requirements of Section 4.3 hereof. The Trustee shall not be bound by, and shall ignore, any such certification which does not comply with the requirements of Section 4.3 hereof. The Trustee shall make payments to Participants and Beneficiaries strictly in accordance with the terms of Section 4.4 hereof and shall have no responsibility or duty to evaluate such certifications or other reports with respect to their validity, accuracy or completeness or to make any inquiry regarding the data or information contained therein. If the Corporation does not provide the Trustee with the information necessary to establish an Account pursuant to this Section 3.2 and Section 4.3 herein, the Trustee shall deposit any contributions for which it has not received information into the Expense Account, and shall maintain the contributions in the Expense Account until it has received such information.



Section 3.3. Benefits Payable . Any benefits becoming payable to a Participant or Beneficiary under the Plan shall be paid from the Fund and charged against the Account maintained with respect to the benefits of such Participant. No payment shall be made from the Fund to or with respect to a Participant to the extent that such payment would exceed the balance then remaining credited in the Account maintained with respect to such Participant.



Section 3.4. Account Adjustment . As of each Valuation Date, and based upon the results of its valuation of the Fund as of such Valuation Date, the Committee shall direct the Trustee to adjust Accounts to reflect realized and unrealized gains, income and losses and chargeable expenses of the Fund on an accrual basis since the preceding Valuation Date, in accordance with the provisions of this Section 3.4. The Account will be adjusted to reflect payment of taxes paid by the Trust with respect to such contributions. The amount creditable to the Account of a Participant as of a Valuation Date selected by the Committee after payment of any benefits and/or applicable withholding taxes shall not exceed the Participant's vested accrued benefit under the Plan as of such date, as determined by the Committee, in its sole and absolute discretion. The allocation of any amounts creditable as contributions, income, losses and realized or unrealized appreciation to the Account of the Participant shall be limited so that the balance as of such Valuation Date does not exceed the Participant ?s accrued benefit under the Plan. Any excess shall rather be allocable to other known or reasonably anticipated liabilities arising under the Plan and/or the Trust. The Trustee shall be under no obligation to question such allocation adjustment.



Section 3.5. Maintenance of Accounts . Once established, an Account shall be maintained with respect to the benefits of each Participant until it has been liquidated through distribution to the Participant, or a Beneficiary thereof.



Section 3.6. Taxability of the Trust and the Participants .



(a) It is intended that the Trust not constitute a "grantor trust" under sections 671 through 679 of the Code, and, notwithstanding any provision of this Agreement to the contrary, the Corporation, as the grantor of the Trust, shall not possess any power under this Agreement that would cause the Trust to constitute a "grantor trust." It is intended that the Trust constitute a taxable entity under sections 641 et. seq. of the Code. Accordingly, the Trustee acknowledges and agrees that the Corporation is not the owner of the Trust for Federal income tax purposes. Notwithstanding any provision of this Agreement to the contrary, none of the powers granted to the Trustee shall be construed to enable the Corporation, the Trustee or anyone else, to buy, exchange or otherwise deal with the Fund for less than adequate and full consideration in money or money ?s worth, or to enable the Corporation, the Trustee or any entity in which the Corporation, the Trustee, or both, have a substantial interest, to borrow from the Fund, directly or indirectly, without adequate interest or security; no one but the Trustee (or the Investment Manager) may vote or direct the vote of any corporate shares or other securities of the Trust, or control the Trust's investments or reinvestments by substituting other property of equal value; the Trustee is not required to surrender Trust assets upon being tendered substitute assets, regardless of the relative values of the assets involved.



(b) The Trust is a funded trust and, as such, it is intended that each Participant in respect of whom an Account is maintained be taxed in accordance with section 402(b) of the Code. Consequently, contributions to the Trust by the Corporation shall be taxable to the Participants in accordance with section 402(b)(1) of the Code. (The Corporation shall take a deduction for the amount of such contributions, for United States Federal income tax purposes, in accordance with section 404(a)(5) of the Code.) Except as is necessary to satisfy any Trust obligation, if any, to withhold taxes and to pay over such withheld amounts to the appropriate taxing authorities, the Trust shall not have any obligation or liability for the payment of any income, estate, gift or employment taxes payable by a Participant or Beneficiary, or the estate of a Participant or Beneficiary, with respect to benefits payable under the Plan. The Trustee shall have the responsibility to file any tax returns, reports or other information as may be required by any Federal, state, local or other taxing or governmental authority with respect to the Trust, its income and distributions and withholding therefrom. Pursuant to Internal Revenue Service Revenue Ruling 2007-48 or successor guidance thereto, the Corporation, if required to withhold employment taxes at the time of contribution, shall withhold and transmit such taxes. The Corporation and the Trustee shall comply as required by law to achieve proper reporting in connection with tax reporting requirements.



Section 3.7. Accumulation/Distribution of Trust Income . All of the income and gain derived from the Fund shall be accumulated and allocated to the Accounts of the Participants pursuant to Section 3.4 hereof; provided, however , that the Committee shall have the right, in its sole and absolute discretion, to instruct the Trustee in writing to distribute all or a portion of such income and gain credited to the Participants' respective Accounts to the Participants.



Section 3.8. Contributions by the Corporation for Income Taxes . If the income and gain derived by the Trust in any taxable year is subject to United States Federal, state or local income tax (e.g., because the Committee has elected not to distribute such income and gain to the Participants) the Trustee shall pay such income taxes from the Fund except to the extent that the Corporation contributes to the Trust an amount to enable the Trustee to pay such income taxes. To the extent such taxes are paid from the Fund, the Accounts shall be reduced on a pro rata basis, subject to Section 3.4. An amount contributed for such purpose shall be allocated to each respective applicable Account and the payment shall be charged against such applicable Account.



ARTICLE IV



CONTRIBUTIONS, CERTIFICATIONS AND DISTRIBUTIONS



Section 4.1. Contributions to the Trust . The Corporation may make such contributions to the Trust as it shall determine in its sole and absolute discretion, are necessary to provide benefits to the Participants under the Plan and for the Trust to pay any income taxes due on its income and gain (as provided in Section 3.8 hereof). Notwithstanding anything to the contrary contained herein, no person, including, without limitation, the Trustee, the Actuary, any Participant or former Participant, or any Beneficiary thereof, shall have the right to require the Cor
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