F. "Independent Trustees": the Trustees other than the Settlor, the Settlor's husband, any of the Settlor's issue, and other than any individual whose

Transcription

1 FOR ILLUSTRATION ONLY: : THE AUTHORS MAKE NO REPRESENTATION AS TO THE VALIDITY OF ANY OF THE SPECIFIC LANGUAGE CONTAINED IN THIS FORM OR AS TO THE EFFECTIVENESS OF SUCH LANGUAGE FOR TAX OR OTHER PURPOSES AND THE AUTHORS DISCLAIM ANY LIABILITY ARISING A FROM ITS USE FORM OF GRANTOR RETAINED ANNUITY TRUST ("GRAT") 1 TRUST AGREEMENT made the day of, 1994, between JENNIFER SETTLOR, as Settlor, and PATRICK TRUSTEE, and CLEO SETTLOR as Trustees. ARTICLE I.: : DEFINITIONS AND RULES OF CONSTRUCTION 1. Definitions. For purposes of this Trust Agreement, the following words and expressions shall have the following meanings and usages: A. "Article": an Article under this Trust Agreement. B. "Code": the Internal Revenue Code of C. "disability": an individual shall be deemed under a disability or to have suffered a disability if and for so long as such individual lacks sufficient understanding or capacity to make and communicate decisions about his or her property, his or her business affairs and matters concerning a Trust in or over which he or she holds an interest or power. The existence of a disability shall be established by i) the written opinion of two licensed physicians or psychiatrists appointed by the Trustees (other than such individual) then in office that a disability (as defined in the preceding sentence) exists, or by ii) the appointment by a court of competent jurisdiction of a guardian, conservator, committee or other similar fiduciary for such individual on the basis of the sworn testimony or written opinion of at least one licensed physician or psychiatrist that a disability (as defined in the preceding sentence) exists. This definition shall not apply to the term "disability" when used as part of the phrase "legal disability." D. "EPTL": the New York Estates, Powers and Trusts Law. E. "generation": the meaning ascribed to this term by Chapter 13 of the Code. 1 Copyright 1994 by Carlyn S. McCaffrey and Pam H. Schneider.

2 F. "Independent Trustees": the Trustees other than the Settlor, the Settlor's husband, any of the Settlor's issue, and other than any individual whose possession of the powers and discretion conferred under this Trust Agreement upon Independent Trustees would result in any portion of the Trust Fund of any Trust in existence on the date of the Settlor's death being included in the Settlor's gross estate for federal estate tax purposes or would result in any portion of the Trust Fund of any Trust in existence at such individual's death being included in his or her gross estate for federal estate tax purposes, or would result in any portion of the Trust Fund of any Trust over which such Trustee exercises discretion being included as a taxable gift of such Trustee for federal gift tax purposes in the year such Trustee exercises such discretion. G. "issue": except as otherwise provided in this Article, all descendants of the designated ancestor who are descended from such ancestor by blood or adoption, provided that an individual adopted after his or her eighteenth (18th) birthday and his or her descendants shall be deemed not to be issue of the adopted individual's adoptive parent or parents. H. "Perpetuities Date": the date occurring twenty-one (21) years after the death of the last survivor of such of the issue of the Settlor's mother and such of the issue of PATRICK's mother who were living at the date of execution of this Trust Agreement. I. "personal representatives": as to a given individual, the person or persons, whether denominated as executors, administrators, personal representatives or otherwise, duly authorized to administer that individual's estate pursuant to that individual's Last Will and Testament in the jurisdiction in which such Will is admitted to original probate, or pursuant to the laws governing the administration of that individual's estate, if he or she died without a will. J. "Settlor": JENNIFER SETTLOR. K. "Settlor's Children": the Settlor's children, JOHN SETTLOR-TRUSTEE and KATE SETTLOR-TRUSTEE, and all children born to or adopted by the Settlor after the date on which this Trust Agreement is executed. L. "Settlor's issue": the Settlor's Children and all issue of the Settlor's Children living from time to time. M. "Settlor's husband": during the Settlor's lifetime, the person who, at any time, is married to and living with the Settlor; after the Settlor's death, the person who was married to and living with the Settlor at the time of the Settlor's death. In determining whether a person is or was living with the Settlor, temporary absences not due to marital difficulties shall be ignored. At the time of the execution of this Trust Agreement, the Settlor's husband is PATRICK TRUSTEE (who is sometimes referred to in this Trust Agreement as "PATRICK").

3 N. "THE SETTLOR-TRUSTEE FAMILY 1994 TRUST": that certain trust under Article FOURTH of the trust agreement dated the same date as the date of this Trust Agreement, made by and between JENNIFER SETTLOR, as settlor, and PATRICK TRUSTEE and CLEO SETTLOR, as trustees, known as the SETTLOR-TRUSTEE FAMILY 1994 TRUST AGREEMENT. O. "Trust": a particular one of the Trusts. P. "Trust Agreement": this Trust Agreement. Q. "Trust Creation Date": the earliest date on which the property listed on Schedule "A" annexed hereto has been transferred, for federal gift tax purposes, by the Settlor to the Trustees. R. "Trust Fund": as to any Trust, all property (principal plus accrued, accumulated and undistributed income) that, at any particular time, belongs to that Trust. S. "Trustees": each Trustee and all Trustees serving under this Trust Agreement at any given time. time. T. "Trusts": all separate trusts held under this Trust Agreement at a particular U. "Will": the last will and testament of an individual and all codicils thereto, whenever executed, that is or are duly admitted to probate. 2. Rules of Construction. For purposes of this Trust Agreement, the following rules of construction shall apply: A. All references to a body of laws or regulations, such as the Code, or to any provision thereof, shall be deemed to refer to such body of laws or regulations, or provision thereof, as the same may be amended from time to time, and shall be deemed to refer as well to any subsequent body of laws or regulations or provisions thereof enacted in its place. B. The terms "Trustees," "Independent Trustees" and "personal representatives" shall be construed in the masculine, feminine, or neuter, and in the singular or plural, whichever construction is consistent with the facts prevailing at any given time. C. A document shall be deemed to have been delivered to a person at such time as it is actually received by such person.

4 D. The title to each Article in this Trust Agreement and in the Table of Contents is included solely for purposes of identification, and shall not be used to ascertain the meaning of any provision contained in this Trust Agreement or for any other reason. ARTICLE II.: : TRUST FUND The Settlor hereby assigns, transfers and delivers to the Trustees the property listed on Schedule "A" annexed hereto. The Trustees agree to hold such property in trust and to manage and dispose of it in accordance with the provisions of this Trust Agreement. The property described on Schedule A shall be the original Trust Fund of a Trust, the dispositive terms of which are set forth in Article IV. It may be identified as the "JENNIFER SETTLOR 1994 TWO-YEAR TRUST." This Trust Agreement may be identified as the "JENNIFER SETTLOR 1994 TWO- YEAR TRUST AGREEMENT." ARTICLE III.: : IRREVOCABILITY 1. Irrevocability. This Trust Agreement and the Trusts may not be altered, amended, revoked or terminated by the Settlor, in whole or in part. 2. Limited Power to Amend. At any time or from time to time when the Settlor is alive and not under a disability, or when PATRICK is alive and not under a disability the Independent Trustees shall have such power to amend the terms of this Trust Agreement as (1) will not cause any portion of the Trust Fund of any Trust to be included in the gross estate (for federal estate tax purposes) of any person and (2) is permitted by section "(C)" of this Article. 3. Restrictions on Power to Amend. At any time or from time to time when the Settlor is alive and not under a disability or when PATRICK is alive and not under a disability, the Independent Trustees, by unanimous consent of all of the Independent Trustees, to the extent permitted by section "(B)" of this Article, may amend the terms of this Trust Agreement and the Trusts in the manner provided in section "(D)" of this Article, provided, however, that no such amendment shall be valid if, as a result thereof: A. any portion of the Trust Fund of any Trust (other than the Annuity Amount described in Article IV); a. may inure to the benefit of any individual or entity (other than a trust) other than the Settlor's husband or an issue of the Settlor while the Settlor's husband or any issue of the

5 Settlor is alive, provided, however, that the terms of this Trust Agreement may be amended i) to eliminate the requirement that any such individual survive a particular date in order to receive a distribution under this Trust Agreement or ii) in a manner consistent with the provisions of subsection "(2)" of this section "(C)," or b. may be paid to a trust created by the Settlor after the execution of this Trust Agreement, or any other trust, if the terms of this section "(C)" would not permit the adoption of the terms of such trust as the terms of a Trust under this Trust Agreement; B. the Settlor may ever be the recipient of any portion of the Trust Fund of any Trust (other than the Annuity Amount described in Article IV), individually or as guardian, conservator, committee, receiver, trustee, custodian under the Uniform Gifts to Minors Act or the Uniform Transfers to Minors Act of any jurisdiction, or in any other capacity on behalf of any person; provided that the Settlor may be the recipient of the Trust Fund to the extent that the same is paid to her as reimbursement for any gift or income taxes payable by her as a result of any direct or indirect transfers by him to any Trust or as a result of any income of a Trust being taxable to her under Code Sec. 671; C. the annuity to be paid by the Trust held under Article IV will not be qualified as a "qualified interest" within the meaning of Code Sec. 2702(b) and the Treasury Regulations promulgated thereunder; Date; D. the date upon which any Trust is to terminate is later than the Perpetuities E. the definitions set forth in Article I are changed; F. the provisions of sections "(A)" or "(B)" of this Article are changed; G. the provisions of this section "(C)" of this Article are changed, except to further restrict the amendment powers conferred upon the Independent Trustees; H. the provisions of Article IV are changed, except in accordance with the overriding provisions of Article IV(L). I. the last sentence of section "(B)" of Article IX is changed; J. the provisions of Article XI are changed except to further restrict the powers of the Trustees.

6 4. Procedure e for Amendment. Any amendment authorized by this Article shall (1) be in writing, (2) be signed by all of the Independent Trustees then serving, and (3) state the date upon which it is to become effective, which date shall not be earlier than thirty (30) days after a copy of such writing has been delivered to the Settlor, or if the Settlor is deceased or under a disability, to PATRICK. At any time when the Settlor is alive and not under a disability, or when PATRICK is alive and not under a disability, any amendment may be revoked by unanimous consent of all of the Independent Trustees at any time prior to its effective date, and, unless such amendment specifically provides that it is to be irrevocable, at any time thereafter unless the Settlor and Patrick are dead or under a disability. Revocation of an amendment shall (1) be in writing, (2) be signed by all Independent Trustees then serving (whether or not they are the ones who made the amendment) and (3) state the date upon which it is to become effective. A copy of each amendment and each revocation of an amendment shall be delivered to each Trustee who is not an Independent Trustee and to the Settlor, or if she is deceased or under a disability, to PATRICK. 5. Release of Power to Amend. Even though the Independent Trustees' power of amendment under this Article is a fiduciary power, the Independent Trustees, at any time, may completely (or partially) release the power of amendment, or they may suspend it for a specific period of time. Any such release or suspension (1) shall be effected in the same manner as an amendment, as provided in section "(D)" of this Article, (2) shall be irrevocable, and (3) shall bind all Trustees serving at any time. 6. Special Provision Relating to PATRICK. For purposes of this Article, PATRICK shall be deemed to have died at any time during the Settlor's life, if any, that he ceases be the Settlor's husband. ARTICLE IV.: : THE JENNIFER J SETTLOR 1994 TWO-YEAR TRUST Following are the dispositive provisions of the JENNIFER SETTLOR 1994 TWO- YEAR TRUST: 1. Trust Term. The term of this Trust (the "Trust Term") shall commence on the Trust Creation Date and shall continue until the day before the second (2nd) anniversary of the Trust Creation Date. 2. Annuity. On the last day of each taxable year during the Trust Term and on the last day of the Trust Term (each such date being hereinafter referred to as an "Annuity Payment Date"), the Trustees shall pay to the Settlor or apply for her benefit, if the Settlor is living on the Annuity Payment Date, or, if she is not living, shall pay to PATRICK or apply for his benefit if PATRICK is living on the Annuity Payment Date, or if neither the Settlor nor PATRICK is living on the Annuity Payment Date, shall pay to the Settlor's personal representatives an amount (the "Annuity

7 Amount"), equal to and hundredths of the initial net fair market value of the Trust Fund. In determining the Annuity Amount, assets shall be valued at their values as of the Trust Creation Date as finally determined for Federal tax purposes. The Trustees shall pro-rate the Annuity Amount, on a daily basis, for the first taxable year and for the taxable year in which the Trust Term ends. 3. Source of Payment. The Annuity Amount shall be paid from income and to the extent income is insufficient, from principal. Any income of the Trust for a taxable year not so paid shall be added to principal. 4. Adjustment. If the initial net fair market value of the Trust Fund is incorrectly determined by the Trustees, then within a reasonable period after the value is finally determined for Federal tax purposes, the Trustees shall pay to or for the benefit of the Settlor, PATRICK or the Settlor's personal representatives, as the case may be, in the case of an undervaluation, or shall receive from the Settlor, PATRICK or the Settlor's personal representatives, as the case may be, in the case of an overvaluation, an amount equal to the difference between the Annuity Amounts properly payable and the Annuity Amounts actually paid, plus, if required by the Code, interest, compounded annually, computed for any period at the rate of interest that the federal income tax regulations prescribe for the Trust for such computation for such period. 5. Payments to PATRICK. At any time before the termination of the Trust when the Settlor is not living if PATRICK survived the Settlor and was the Settlor's husband at the time of the Settlor's death, the Trustees shall pay to PATRICK, if he is then living, in quarter annual or more frequent installments, as may be convenient to the Trustees, the entire net income of the Trust, to the extent not already distributable to him pursuant to section "(B)" of this Article. If the Trustees are required to pay income to PATRICK pursuant to this section, PATRICK shall have the power to require the Trustees to convert unproductive or under-productive property to incomeproducing property that produces a reasonable rate of return. 6. Disposition on Termination. The Trust shall terminate on the last day of the Trust Term unless PATRICK is then living and payments were required to be made to him pursuant to section "(E)" of this Article, in which case the Trust shall terminate on PATRICK's death. Upon such termination, the Trustees shall dispose of the Trust Fund remaining after payment of the final installment of the Annuity Amount and any interest thereon (the "Trust Fund Balance") as provided in this section. Any disposition of the Trust Fund Balance pursuant to this section shall be subject to an obligation to repay to the Trustees any amount that the Trustees are required to pay to the Settlor, PATRICK or the Settlor's personal representatives, as the case may be, pursuant to section "(D)" of this Article. If payments were required to be made to PATRICK pursuant to section "(E)" of this Article, the Trustees shall pay all accrued and undistributed income to PATRICK's estate. The remaining Trust Fund Balance (or the entire Trust Fund Balance if the preceding sentence is not applicable) shall be disposed of as follows: If the Settlor's husband or the Settlor is then living, the

8 Trustees shall pay such property to the trustees then in office of THE SETTLOR-TRUSTEE FAMILY 1994 TRUST, who shall add such property to the principal of that trust for administration and disposition therewith. If such trust is not then in existence, such property shall be held by the Trustees in a separate Trust, to be known as the SETTLOR-TRUSTEE FAMILY 1994 TRUST II, under the provisions of Article V. If neither the Settlor nor the Settlor's husband is then living, and if PATRICK was the Settlor's husband at the time of his death, the Trustees shall pay such property to or among any one or more of the Settlor's issue, in such amounts or proportions and to the exclusion of any one or more of them, outright or in further trust, upon such terms and conditions as PATRICK appoints by written instrument signed and acknowledged by him and delivered to the Trustees during his life or by PATRICK's Will, that refers specifically to this power. If, or to the extent that, PATRICK does not effectively exercise this special power to appoint this property, the Trustees shall pay such property to the Settlor's children then living, subject to the provisions of Article VI. If none of the Settlor's children is then living, the Trustees shall pay such property to the Settlor's issue then living, subject to the provisions of Article VII. If none of the Settlor's issue is then living, such property shall be disposed of as provided in Article VII(B). 7. Taxable Year. The taxable year of the Trust shall be the calendar year. 8. No Additions. No additional contributions may be made to the Trust, after the initial contribution as described in Article II. 9. No Payments to Others. No payment or application of any portion of the Trust Fund shall be made at any time during the Trust Term i) to or for the benefit of any person other than the Settlor, for so long as the Settlor is living during the Trust Term, or, ii) to or for the benefit of any person other than PATRICK or the Settlor's personal representatives as provided herein, after the Settlor's death during the Trust Term. 10. No Commutation. The interests of the Settlor, PATRICK, and the Settlor's personal representatives shall not be subject to commutation. 11. Overriding Provision. It is the Settlor's intention that the interest retained by her (and PATRICK's interest) in the Annuity Amount qualify as a "qualified annuity interest" within the meaning of Code Sec. 2702(b)(1) and section of the Treasury Regulations promulgated thereunder. Accordingly, no authorization or direction or other provisions contained in this Trust Agreement that would prevent the Trust from so qualifying shall apply to this Trust, it being the Settlor's intention that any court having jurisdiction over this Trust Agreement construe it accordingly. 12. Amendment. Any provision of this Trust Agreement to the contrary notwithstanding, until the Settlor's death:

9 A. the Trustees shall amend this Trust in any manner required for the sole purpose of ensuring that the interest retained by the Settlor in the Annuity Amount qualifies as a "qualified annuity interest" within the meaning of Code Sec. 2702(b)(1) and the Treasury Regulations promulgated thereunder; and B. the Independent Trustees shall have such power to amend the terms of this Article in the manner provided in Article III as i) will not cause the interest retained by the Settlor in the Annuity Amount to be disqualified as a "qualified annuity interest" within the meaning of Code Sec. 2702(b)(1) and the Treasury Regulations promulgated thereunder; ii) will not cause any change in the valuation of any interest in the Trust for federal gift or estate tax purposes; and iii) is permitted by Article III (without regard to Article III(c)(8)). 13. PATRICK'S Annuity. Any provision of this Trust Agreement to the contrary notwithstanding, the Settlor reserves the right, exercisable by written instrument signed by her and delivered to the Trustees or by the Settlor's Will, to revoke PATRICK's right to receive the Annuity Amount as provided in section "(B)" of this Article. Upon revocation, PATRICK shall be deemed to have predeceased the Settlor for purposes of this Article. ARTICLE V.: : THE SETTLOR-TRUSTEE TRUSTEE FAMILY 1994 TRUST II The following are the dispositive provisions of the SETTLOR-TRUSTEE FAMILY 1994 TRUST II: 1. Discretionary Distributions. The Trustees shall pay or apply to or for the benefit of any one or more members of a class consisting of the Settlor's husband and the Settlor's issue living from time to time, in such amounts or proportions, and to the exclusion of any member or members, as the Independent Trustees, in their sole discretion, shall determine, for any reason or purpose whatsoever, as much or all (or none) of the Trust Fund, as the Independent Trustees, in their sole discretion, shall determine at any time or from time to time. In exercising the discretion granted in this section, the Independent Trustees need not, but may, consider the assets and income apart from the Trust of the beneficiaries, or any of them. At the end of each calendar year, the Trustees shall add to principal any net income not so paid or applied. The Settlor confirms that pursuant to this section, the Independent Trustees may, at any time, distribute the entire Trust Fund to the beneficiaries, or any of them, even though such distribution terminates the Trust, and without regard to the interest of any remainder beneficiary of the Trust. Before making any payment or application to or for the benefit of any of the Settlor's issue, the Independent Trustees shall consult with PATRICK as to the advisability of making such payment or application, but the Independent Trustees shall not be bound by PATRICK's

10 preferences in that regard, and their decision as to such payment or application shall be final and binding upon all persons having an interest in the Trust. 2. Power of Withdrawal. A. In each calendar year prior to the year of PATRICK's death, PATRICK shall have the absolute right, from time to time, to direct the Trustees to pay to PATRICK out of the principal of the Trust an aggregate amount not exceeding five percent (5%) of the principal of the Trust valued on the last day of the calendar year in which PATRICK submits such direction or directions (the "Annual Amount"). The right to direct payment shall be noncumulative and shall be exercised by a written instrument signed by PATRICK alone and delivered to the Trustees prior to the close of such year. B. In any given calendar year, the Trustees are authorized to make payments to PATRICK on account of the Annual Amount based upon the value of the principal of the Trust at the time of such direction, notwithstanding that (i) the Annual Amount cannot be precisely determined until the end of such year, or that (ii) PATRICK may not be living at the end of such year. If it is determined, after the end of such year, that there has been an overpayment, then PATRICK shall repay to the Trustees the amount by which the aggregate payments made in such year on account of the Annual Amount exceed the Annual Amount. PATRICK's personal representatives shall repay to the Trustees an amount equal to the aggregate payments, if any, made to PATRICK during the year of PATRICK's death.

11 3. Disposition on Termination. Unless sooner terminated by the distribution of the entire Trust Fund, the Trust shall terminate upon the earliest date on which the Settlor is not living and there is no living Settlor's husband. Upon such termination, if PATRICK was the Settlor's husband at the time of his death, the Trustees shall pay the Trust Fund to or among any one or more of the Settlor's issue, in such amounts or proportions and to the exclusion of any one or more of them, outright or in further trust, upon such terms and conditions as PATRICK appoints by written instrument signed and acknowledged by him and delivered to the Trustees during his life or by PATRICK's Will that refers specifically to this power. If, or to the extent that, PATRICK does not effectively exercise this special power to appoint this property, the Trustees shall pay the Trust Fund to the Settlor's children then living, subject to the provisions of Article VI. If none of the Settlor's children is then living, the Trust Fund shall be paid to the Settlor's issue then living, subject to the provisions of Article VII. If none of the Settlor's issue is then living, the Trust Fund shall be disposed of as provided in Article VII(B). 4. Repayment of Trustees. Any payment, application, or distribution pursuant to this Article shall be subject to an obligation to repay the Trustees any amount the Trustees are required to pay to the Settlor, to PATRICK, or to the Settlor's personal representatives, as the case may be, pursuant to section "(D)" of Article IV. ARTICLE VI.: : TRUSTS FOR ISSUE If any share of any terminating Trust (including any Trust under this Article) would otherwise be payable (other than by reason of the exercise of a discretionary power or of a power of appointment granted under this Trust Agreement) to any child or more remote issue of the Settlor, who is then younger than thirty (30) years of age, such share shall not be paid to such individual outright, but shall, instead, be held by the Trustees in as many Trusts for such individual (referred to in this Article as the "Beneficiary"), each upon the terms set forth in this Article, as the Trustees, in their sole discretion, shall direct. 1. Discretionary Distributions. The Trustees shall pay to the Beneficiary, or apply for his or her benefit, for any reason or purpose whatsoever, as much or all (or none) of the Trust Fund as the Independent Trustees, in their sole discretion, shall determine at any time or from time to time. In exercising the discretion granted in this section, the Independent Trustees need not, but may, consider the Beneficiary's assets and income apart from the Trust. At the end of each calendar year, the Trustees shall add to principal any net income not so paid or applied. The Settlor confirms that pursuant to this section, the Trustees may, at any time, distribute the entire Trust Fund to the Beneficiary, even though such distribution terminates the Trust, and without regard to the interest of any remainder beneficiary of the Trust. The Independent Trustees need not, but may, consider the Beneficiary's assets and income apart from this Trust in exercising their discretionary power to make payments to or for the Beneficiary.

12 2. Power of Appointment. A. The Independent Trustees, at any time, may grant to the Beneficiary a general power of appointment (as defined in Code Sec of the Code), or a limited power of appointment, which power of appointment may be subject to such restrictions as the Independent Trustees set forth in the instrument by which the power of appointment is granted. However, the Independent Trustees shall prohibit the Beneficiary from appointing during the Beneficiary's life to or for the benefit of any person or entity assigned to a generation above the Beneficiary's generation. The grant of this power of appointment shall be effected by written instrument delivered to the Beneficiary and may be revoked at any time during the Beneficiary's life by written instrument of revocation delivered to the Beneficiary. If revoked, a new power of appointment may be granted as provided in the preceding provisions of this section. B. Without limiting the purpose for which the Independent Trustees may grant a general power of appointment to the Beneficiary, the Settlor requests that they give particular consideration to granting such a power if the generation-skipping transfer taxes that the Trust would be required to pay at the Beneficiary's death are estimated to be greater than the estate taxes that would be payable by the Beneficiary's estate if the property held in the Trust at his or her death were included in his or her gross estate for federal estate tax purposes. In determining whether to grant or revoke a general power of appointment under this section, the Independent Trustees may rely conclusively on a statement provided by or on behalf of the Beneficiary as to the potential value of his or her gross estate for federal estate tax purposes. 3. Disposition on Termination. Unless sooner terminated by the distribution of the entire Trust Fund, the Trust shall terminate on the earlier to occur of the Beneficiary's thirtieth (30th) birthday or the Beneficiary's death. Upon such termination, the Trustees shall pay the Trust Fund, if or to the extent not appointed effectively pursuant to a power granted under this Article, a. to the Beneficiary's issue who survive the Beneficiary, or, if there be no such issue, b. to the then living issue of the Beneficiary's nearest ancestor who was descended from the Settlor and who has then living issue, or, if there be no such ancestor or issue, c. to the Settlor's then living issue, subject, in each case, to the provisions of this Article. 4. Termination on Perpetuities Date. Notwithstanding anything to the contrary in this Article, each Trust held under this Article shall terminate, unless it shall have sooner terminated, on the Perpetuities Date, whereupon the Trustees shall pay the entire then Trust Fund to the Beneficiary of that Trust, outright and free of trust.

13 5. Repayment of Trustees. Any payment, application, or distribution pursuant to this Article shall be subject to an obligation to repay the Trustees any amount the Trustees are required to pay to the Settlor, to PATRICK, or to the Settlor's personal representatives, as the case may be, pursuant to section "(D)" of Article IV. ARTICLE VII.: : SPECIAL DISTRIBUTION IBUTION RULES 1. Per Stirpital Distributions. Except as otherwise provided, mandatory distributions or payments of property to the issue of a particular person shall be distributed to or paid to such issue on a per stirpes basis. The preceding sentence shall not apply to discretionary distributions or payments or payments made pursuant to the exercise of a power of appointment granted under this Trust Agreement. For purposes of determining any per stirpital distribution, the initial division into shares shall be made at the level of such person's children, whether or not any child of such person is then living. 2. Undisposed of Shares. If, upon the occurrence of any contingency, any share of any Trust shall not be completely disposed of by the other provisions of this Trust Agreement, then such undisposed of share shall be paid to those persons who would have inherited it from the Settlor, and in the same proportions in which they would have shared it, had the Settlor then died intestate, unmarried, the absolute owner of it, and a resident of the State of New York. 3. Distributions to Persons Under Legal Disability. Distribution of any money or other property under this Trust Agreement to a person who is a minor or who is under some other legal disability may, in the sole discretion of the Trustees, be made directly to that person or to that person's guardian in whatever jurisdiction appointed; or in the case of a person who is younger than twenty-one (21) years of age, whether or not a minor, and whether or not under legal disability, to a custodian (to be selected by the Trustees) for such person's benefit under the Uniform Gifts to Minors Act or the Uniform Transfers to Minors Act of any jurisdiction and, if permitted by the applicable Act, a "minor" shall be deemed to attain majority at twenty-one (21) years of age; and the receipt of the one to whom distribution is made shall be a full discharge in respect of the distributed money or other property even though the issuer of the receipt is a Trustee. No distribution may be made pursuant to this section to the Settlor in any capacity.

14 4. Assignment of Trust Interests. Except with the written consent of the Independent Trustees, no disposition, charge or encumbrance of the income or principal of any Trust, or any part thereof, by way of anticipation, alienation or otherwise shall be valid or in any way binding upon the Trustees and, except with such written consent, no beneficiary of any Trust may assign, transfer, encumber or otherwise dispose of such income or principal, or any part thereof, until it shall be paid to such beneficiary by the Trustees. No income or principal of any Trust or any part thereof shall be liable to any claim of any creditor. 5. Judicial Intervention. Under no circumstances shall of the EPTL or any similar provision of law apply to any Trust. ARTICLE VIII.: : SURVIVORSHIP REQUIREMENTS If any beneficiary whose entitlement to property (whether income or principal and whether outright or in trust) depends under this Trust Agreement upon his or her surviving the occurrence of some event, dies under such circumstances that it is difficult or impossible to determine whether or not he or she was alive upon the occurrence of such event, such beneficiary shall be deemed for all purposes of this Trust Agreement to have died prior to the occurrence of such event. ARTICLE IX.: : CHOICE OF LAW 1. New York Law. Except as provided in section "(B)" of this Article, all questions pertaining to the validity, construction and administration of this Trust Agreement and the Trusts shall be determined in accordance with the laws of the State of New York in effect from time to time.

15 2. Change of Applicable Law. The Trustees may at any time or from time to time as they deem advisable in their discretion, remove all or part of the assets or change the situs of administration of any Trust from one jurisdiction to another jurisdiction, and may elect that the law of such other jurisdiction shall thereafter govern the same to such extent as may be necessary and appropriate, and thereupon the courts of such other jurisdiction shall have the power to effectuate the purposes of this Trust Agreement to such extent. This power of removal shall be a continuing power which may be exercised any number of times. The determination of the Trustees as to any such removal or change of situs shall be conclusive and binding on all persons interested in such Trust. Notwithstanding the provisions of this paragraph, the Trustees shall not elect that the law of any other jurisdiction shall govern the administration of any Trust if such election would have the effect of altering any beneficial interest under this Trust Agreement. ARTICLE X.: : TRUSTEES' POWERS 1. Overriding Provisions. The provisions of this Article are expressly subject to the overriding provisions of Article IV(K) and Article XI. 2. General Powers. The Settlor gives to the Trustees all powers and discretion conferred generally upon fiduciaries by the provisions of section of the EPTL and other provisions of law and this Trust Agreement. Without limiting the foregoing, the Settlor also gives to the Trustees the following powers and discretion as to all property of whatever kind at any time held by them, including income held by them, until final distribution, which they may exercise as they deem advisable: A. To sell, purchase, exchange, invest and reinvest in bonds, preferred or common stocks, mortgages, interests in any kind of investment trust, or other evidences of rights, interests or obligations, secured or unsecured, foreign or domestic, or any other property, real or personal and whether or not in the nature of a wasting asset, without any duty to diversify investments, and fully free of any and all restrictions imposed by law upon the investment of funds held by a fiduciary; and to retain the same for any period of time without liability therefor; B. To employ such one or more agents, accountants, custodians, experts and counsel, legal or investment (including any firm with which any of the Trustees or the Settlor may be affiliated), as the Trustees shall determine, to delegate discretionary powers to, and rely upon information or advice furnished by them, and to compensate them out of the property of the Trusts on behalf of which the engagement was made (and not out of the Trustees' commissions);

16 C. To improve, lease (for any term, whether or not beyond the term of the administration of the Trusts or the term fixed by any law), partition or otherwise deal with or dispose of any real or personal property or any interest therein; to demolish or to make alterations in and extraordinary improvements to any building now or hereafter located on any such property; to construct new buildings; and to enter into contracts or grant options (for any period) as to any of the foregoing; D. To consent to the modification, renewal or extension of any note, whether or not secured, or any bond or mortgage, or any term or provision thereof, or any guarantee thereof, or to the release of such guarantee; to release obligors on bonds secured by mortgages or to refrain from instituting suits or actions against such obligors for deficiencies; to use property held under this Trust Agreement for the protection of any investment in real property or in any mortgage on real property; E. To abandon any property, real or personal, that they deem to be worthless or not of enough value to warrant keeping or protecting; to abstain from the payment of taxes, water rents, assessments, repairs, maintenance and upkeep of it; to permit such property to be lost by tax sale or other proceeding, or to convey it for nominal or no consideration; F. To exercise or dispose of any or all options, privileges or rights appurtenant or incident to the ownership of any property, whether to vote, assent, subscribe, convert or of any other nature; to become a party to, or deposit securities or other property under, or accept securities issued under, any voting trust agreement; G. To assent to or participate in any reorganization, readjustment, recapitalization, liquidation, partial liquidation, consolidation, merger, dissolution, sale or purchase of assets, lease, mortgage, contract or other action or proceeding by any corporation and, in that connection, to subscribe to new securities, to exchange any property for any other property, and to pay any assessments or other expenses; to delegate discretionary powers to any reorganization, protective or similar committee; H. To borrow money from any party, including any of the Trustees, for any purpose whatsoever and to give or not to give security for the loan; I. To consent, or to decline to consent, to the election (including any that are now in effect) by any corporation to be taxed under subchapter S of the Code; J. To make any loans, either secured or unsecured, in such amounts, and upon such terms as to interest and repayment, and to such persons, firms or

17 corporations (including the estate of the Settlor or the estate of the Settlor's husband) as they determine in their discretion, and, in the case of a loan to the Settlor's estate or to the estate of the Settlor's husband, irrespective of whether any beneficiary, personal representative or trustee under the Settlor's Will or under the Settlor's husband's Will is a beneficiary or Trustee under this Trust Agreement; provided, however, that all loans, other than loans from a Trust held hereunder to a beneficiary of that Trust (other than the Settlor) to whom current distributions of income may be made, shall be made at a reasonable rate of interest, and provided, further, that only the Independent Trustees shall participate in any decision to lend property at less than a reasonable rate of interest; K. To purchase assets at their fair market value from the Settlor's estate or from the Settlor's husband's estate, or from any trust created under the Settlor's Will or the Settlor's husband's Will upon such terms and conditions as they shall determine, and irrespective of whether any beneficiary, executor or trustee under the Settlor's Will or under the Settlor's husband's Will is a beneficiary or trustee hereunder; L. To hold property in the name of a nominee or unregistered or in such form as will pass by delivery; M. To credit receipts (including, but not limited to, gains from the sale or exchange of property) and to charge expenditures and other disbursements to or between income and principal in such amounts and proportions as the Trustees deem advisable, without regard to any prior allocation made at any time and notwithstanding any contrary provision of law; N. To open and maintain bank accounts and brokerage accounts; and O. To do any and all acts, to exercise any and all rights, to enter into any and all proceedings, contracts (including contracts containing guarantees, warranties, representations and indemnifications of any kind or nature), and other instruments (whether or not specified above and including but not limited to the preparation and filing of any and all registration statements and papers, documents and instruments of whatever kind and nature with the Securities and Exchange Commission and the payment of any and all expenses in that connection) necessary or proper in their opinion in the administration of any Trust as fully as if they were the absolute owners of such property.

18 3. Exoneration of Third Parties. No person dealing with the Trustees shall be bound to see to the application or disposition of cash or other property transferred to them or to inquire into the authority for or propriety of any action by the Trustees. 4. Distributions in Kind or in Cash. Distributions of principal and income of any Trust may be made in kind or in cash or partly in kind and partly in cash to any one or more of the beneficiaries of that Trust (including any trust) whether or not the same kind of property is distributed to other beneficiaries. In determining the manner in which the property of any Trust is to be allocated among its beneficiaries (including any trust), the Trustees are authorized to take into account or not the income tax basis (either before or after distribution, or both) of each item of property in any manner and to such extent as they shall deem appropriate. 5. Consolidation of Trust Property. The Trustees shall not be required to segregate physically the property held in any Trust except when necessary for the purposes of distribution, but may, in their discretion, maintain the trust property in one or more consolidated funds. As to each consolidated fund, the division into the various shares or parts comprising such fund need be made only on the Trustees' books of account, in which each Trust shall be allotted its proportionate part of the principal and income of the fund and charged with its proportionate part of expenses of the fund and charged further with distributions of income and principal of such Trust. 6. Combination and Division of Trusts. A. If two or more Trusts are held or directed to be held with identical terms and identical beneficiaries, the Trustees may, but need not, combine any two or more of such Trusts and administer the combined Trusts as a single Trust. B. The Trustees may divide any Trust other than the Trust held under Article IV into two or more separate Trusts of equal or unequal size each having terms identical to the terms of such Trust. C. If, pursuant to any authority granted in this Trust Agreement, the Trustees direct that any Trust shall be divided into two or more separate Trusts, then the Trustees shall determine which property then allocated or held in such Trust shall be allocated to each such separate Trust. 7. Powers to Deal With Closely Held Business and Investment Interests. As to each and any corporation, partnership or other business entity, public or private, in which the Trustees, as such, hold or acquire any equity interest exceeding one percent (1%) of the net value of such corporation, partnership or other business entity (each such corporation, partnership or other business entity being hereafter referred to as the "Entity"), the Trustees are hereby authorized to retain the shares thereof or interest therein for as long as they deem to be in the best interests of any Trust, regardless of the fact that such shares or interest might produce no income, regardless of any duty to

19 diversify investments, and notwithstanding any other fiduciary obligation which might require them to dispose of such shares or interest, other than the obligation to act with reasonable care. In addition, the Settlor authorizes and empowers the Trustees, to the extent permitted by law, to exercise their rights and powers as holders of such shares or interest to effect the continued operation of the Entity, or the sale or other disposition of its assets or business or, in their sole discretion, to sell, exchange, offer for redemption or otherwise dispose of the shares of or interest in the Entity owned by any Trust, or to effect the liquidation or dissolution of the Entity, at such time or times and upon such terms and conditions as shall, in the opinion of the Trustees, be in the best interests of the Trusts or any one or more of them. So long as the Trustees continue to hold any interest in the Entity, the Settlor authorizes and empowers them to participate in the management of the Entity to the extent that their interest therein enables them to do so, without liability or responsibility for any loss resulting from the exercise of the powers hereby granted, or to delegate their managerial authority to others, whether by means of employment agreements or other arrangements, and they may enter into voting trusts and grant irrevocable proxies, as they deem advisable. Consequently and to these ends, the Settlor authorizes the Trustees to select, vote for and remove directors of the Entity (if the Entity is a corporation), to take part in the management of the Entity and, to the extent permitted by law, in their managerial capacity to fix, determine or change the policy thereof; to name or change officers, the managing personnel and/or the operating personnel; to employ new management; to reduce, expand, limit or otherwise change the business or type of merchandise dealt in or property invested in and investments held by or product manufactured by or service rendered by the Entity; to require the employees and/or the officers of the Entity to file bonds for the faithful performance of their duties; to determine the amount of the bond or bonds to be secured; to select the bonding company; to employ expert outside and disinterested accountants or engineers to make a full and complete survey or appraisal of the Entity's business and its prospects in the trade; to employ investment or legal counsel (including any firm with which a Trustee may be associated) whenever the Trustees shall deem it advisable; to charge the cost of all such services against the interest in the Entity held by the Trustees or to vote or take other action to require the Entity owning said business to pay such expense; to contribute additional working capital or to subscribe to additional stock as they may see fit; and to take all steps and perform all acts which they shall deem necessary or advisable in connection therewith. Notwithstanding the foregoing provisions of this section, the Trustees shall not be bound or required to take part in the management of the Entity, and they may leave the same (including the payment or non-payment of dividends) wholly to the directors or other persons charged with such management, unless they shall have notice of any act of dishonesty, misappropriation or misapplication of moneys or other property on the part of such directors or other persons. Except as is otherwise provided in this Article, no person having an interest hereunder

20 shall be entitled in any way to compel, control or forbid the exercise in any particular manner of any voting or other right which may at any time be vested in the Trustees with regard to the Entity. Any one or more of the Trustees may act as officer, partner, director, manager or employee of the Entity, and the Trustees are specifically authorized to exercise their rights inhering in their ownership as Trustees for the election or appointment of any person or persons, including themselves, as directors, officers, managers or the like. Any Trustee who serves as officer, partner, director, manager or employee of the Entity shall be entitled to receive compensation for such services notwithstanding that the Trustees may themselves (whether individually and/or as Trustees hereunder) be in a position to determine, or control the determination of, the amount of such compensation, and the Settlor directs that no such person shall be required to furnish any bond in connection with any such employment. The Settlor is aware that conflicts of interest may arise by reason of service on the part of the Trustees as such and as officer, partner, director, manager or employee of the Entity and by reason of the Trustees' owning or purchasing an interest in the Entity in their own right. The Settlor intends that the Trustees shall, in all respects, be free to exercise the powers and discretion herein conferred as fully and unrestrictedly as if there were no such conflicting interests. With this thought in mind, the Settlor expressly exempts the Trustees from the adverse operation of any rule of law which might otherwise apply to them in the performance of their fiduciary duties by reason of conflict of interest. Without limiting the generality of the foregoing, the Settlor specifically directs that the Trustees shall not have any greater burden of justification in respect of their acts as Trustees by reason of conflict of interest than they would have in the absence of any such conflict. In particular, the Trustees of any Trust, in their capacity as such, are authorized to enter into any transaction with any Entity that such Trust could enter into with any unrelated third person, without regard to any rule of law that might otherwise prohibit any such transaction by reason of self-dealing or other conflicts of interest. Without limiting the generality of the foregoing, the powers reserved by the preceding sentence shall include, without limitation, the powers i) to purchase property from, sell property to or exchange property with any Entity, ii) to borrow money or other property from or lend money or other property to any Entity, and iii) to employ, on behalf of the Trust, agents, accountants, custodians, experts and legal or investment counsel who also perform comparable services for the Entity or for any one or more of the Trustees. In addition, any Trustee may purchase, sell, exchange or otherwise deal in or dispose of shares of or interests in the Entity for his or her account without regard to any rule of law that might otherwise prohibit any such transaction by reason of self-dealing or other conflicts of interest, or that might otherwise require such Trustee to first offer the opportunity to enter into that transaction to the Trust of which he or she is Trustee. Entity. If the Settlor is serving as Trustee, she shall have no power to vote the shares of any