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Exhibit 4.6
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FIRST AMENDMENT TO
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FOREST CITY ENTERPRISES, INC.
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DEFERRED COMPENSATION PLAN FOR NONEMPLOYEE DIRECTORS
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This First Amendment to Forest City Enterprises, Inc. Deferred
Compensation Plan for Nonemployee Directors (the "First Amendment") is effective
as of the 1st day of October, 1999, by Forest City Enterprises, Inc. (the
"Company").
WITNESSETH
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WHEREAS, the Company established the Forest City Enterprises, Inc.
Deferred Compensation Plan for Nonemployee Directors (the "Compensation Plan")
effective as of January 1, 1999, as amended, and
WHEREAS, the Company desires to amend the Compensation Plan as
hereinafter set forth.
NOW, THEREFORE, the Compensation Plan is amended as follows:
1. Article II, Section 2, Page 4 of the Compensation Plan is hereby
amended by adding the following sentence at the end thereof:
Any Participant receiving the Committee's written authorization
pursuant to Section 3 of this Article II to defer all or a part of his
or her Fee to a date after the Participant's retirement date, or to a
date prior to the Participant's retirement date, must deliver an
Election Agreement to the Committee at least two (2) years in advance
of the date the Participant elects to have the benefit payments
commence under the terms of Section 5 of this Article II.
2. Article II, Section 3, Page 4 of the Compensation Plan is hereby
amended by deleting the last sentence of this Section. The following revised
sentence shall be inserted:
Unless the Committee permits (by written authorization) a Participant
to elect a deferral period ending earlier or later than the Termination
of Service Date described hereafter, the applicable percentage(s) or
dollar amount(s) of his or her Fee shall be deferred until the date the
Participant ceases to be a Director by death, retirement or Disability
or otherwise ceases to be a Director of the Company (the "Termination
of Service Date").
This Section 3 of Article II, Page 4 of the Compensation Plan is
further amended by adding the following at the end thereof:
Notwithstanding the foregoing, the Committee may, in its sole
discretion, permit (by written authorization) a Participant to defer
the applicable percentage(s) or dollar amount(s) of his or her Fee (a)
to a date after the Participant's retirement date, or (b) to a date
that precedes the
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Participant's stated retirement date and that is at least two (2) years
after the date of the election, provided the Participant shall timely
file an Election Agreement in accordance with Article II, Section 2.
The Committee may, in its sole discretion, permit (by written
authorization) a Participant to modify or revoke any such election at
any time and from time to time by the filing of a later written
election with the Committee, provided, however, that any election made
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less than one year prior to the Participant's Termination of Service
Date, or less than two years prior to the date the Participant elects
to have the benefit payments commence, shall not be valid, and in such
case, payment shall be made in accordance with the latest valid
election of the Participant.
3. Article V, Section 3, Subparagraph (a), Page 7 of the Compensation
Plan is hereby amended by inserting a comma after the words "irrevocable trust",
and adding the following language, "substantially in the form of the Rabbi Trust
attached hereto as Exhibit C."
4. This Compensation Plan is hereby amended by adding a form of a Rabbi
Trust Agreement (substantially in the form attached hereto as Exhibit C).
5. Except as expressly amended and modified herein, the provisions of
the Compensation Plan shall remain in full force and effect.
6. Except to the extent preempted by federal law, this First Amendment
shall be governed by and construed in accordance with the laws of the State of
Ohio.
EXECUTED at Cleveland, Ohio as of October 1, 1999.
Forest City Enterprises, Inc.
By:
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Name: Thomas G. Smith
Title: Chief Financial Officer, Senior Vice
President and Secretary
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EXHIBIT C
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RABBI TRUST AGREEMENT
UNDER THE FOREST CITY ENTERPRISES, INC. DEFERRED COMPENSATION
PLAN FOR NONEMPLOYEE DIRECTORS
This Rabbi Trust Agreement ("Agreement") made this 1st day of October, by
and between Forest City Enterprises, Inc. ("Company") and First Merit
("Trustee");
WHEREAS, Company has adopted the Forest City Enterprises, Inc. Deferred
Compensation Plan For Nonemployee Directors effective as of January 1, 1999, as
amended (the "Plan");
WHEREAS, Company wishes to establish a trust (hereinafter called "Trust")
and to contribute to the Trust assets that shall be held therein, subject to the
claims of Company's creditors in the event of Company's Insolvency, as herein
defined, until paid to Plan participants and their beneficiaries in such manner
and at such times as specified in the Plan;
WHEREAS, it is the intention of the parties that this Trust shall
constitute an unfunded arrangement and shall not affect the status of the Plan
as an unfunded plan maintained for the purpose of providing deferred
compensation for Nonemployee Directors for purposes of Title I of the Employee
Retirement Income Security Act of 1974;
WHEREAS, it is the intention of Company to make contributions to the
Trust to provide itself with a source of funds to assist it in the meeting of
its liabilities under the Plan;
WHEREAS, it is the intention of Company to make contributions to the
Trust to provide itself with a source of funds to assist it in the meeting of
its liabilities under the Plan;
NOW, THEREFORE, the parties do hereby establish the Trust and agree
that the Trust shall be comprised, held and disposed of as follows:
Section 1: Establishment of Trust
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(a) Company hereby deposits with Trustee in trust ten dollars
($10.00), which shall become the principal of the Trust to be held, administered
and disposed of by Trustee as provided in this Trust Agreement.
(b) The Trust hereby established is revocable by Company; it shall
become irrevocable upon the earlier to occur of (i) a Change of Control, as
defined in Article I, Section 5
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of the Plan, or (ii) a declaration by the Board of Directors of the Company that
a Change of Control is imminent.
(c) The Trust is intended to be a grantor trust, of which Company is
the grantor, within the meaning of subpart E, part I, subchapter J, chapter 1,
subtitle A of the Internal Revenue Code of 1986, as amended, and shall be
construed accordingly.
(d) The principal of the Trust, and any earnings thereon shall be
held separate and apart from other funds of Company and shall be used
exclusively for the uses and purposes of Plan participants and general creditors
as herein set forth. Plan participants and their beneficiaries shall have no
preferred claim on, or any beneficial ownership interest in, any assets of the
Trust. Any rights created under the Plan shall be mere unsecured contractual
rights of Plan participants and their beneficiaries against Company. Any assets
held by the Trust will be subject to the claims of Company's general creditors
under federal and state law in the event of Insolvency, as defined in
Section 3(a) herein.
(e) Upon a Change of Control, Company shall, as soon as possible, but
in no event longer than five (5) days following the Change of Control, as
defined herein, make an irrevocable contribution to the Trust in an amount that
is sufficient to pay each Plan participant or beneficiary the benefits to which
Plan participants or their beneficiaries would be entitled pursuant to the terms
of the Plan as of the date on which the Change of Control occurred.
Section 2: Payments to Plan Participants and Their Beneficiaries
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(a) Following any funding of the Trust in excess of the amount set
forth in Section 1(a) hereof, Company shall deliver to Trustee a schedule (the
"Payment Schedule") that indicates the amounts payable in respect of each Plan
participant (and his or her beneficiaries), that provides a formula or other
instructions acceptable to Trustee for determining the amounts so payable, the
form in which such amount is to be paid (as provided for or available under the
Plan), and the time of commencement for payment of such amounts. Except as
otherwise provided herein, Trustee shall make payments to the Plan participants
and their beneficiaries in accordance with such Payment Schedule. The Trustee
shall make provision for the reporting and withholding of any federal, state or
local taxes that may be required to be withheld with respect to the payment of
benefits pursuant to the preceding sentence and shall pay amounts withheld to
the appropriate taxing authorities or determine that such amounts have been
reported, withheld and paid by Company.
(b) The entitlement of a Plan participant or his or her beneficiaries
to benefits under the Plan shall be determined by Company or such party as it
shall designate under the Plan, and any claim for such benefits shall be
considered and reviewed under the procedures set out in the Plan.
(c) Company may make payment of benefits directly to Plan
participants or their beneficiaries as they become due under the terms of the
Plan. Company shall notify Trustee
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of its decision to make payment of benefits directly prior to the time amounts
are payable to participants or their beneficiaries. In addition, if the
principal of the Trust, and any earnings thereon, are not sufficient to make
payments of benefits in accordance with the terms of the Plan, Company shall
make the balance of each such payment as it falls due. Trustee shall notify
Company where principal and earnings are not sufficient.
Section 3: Trustee Responsibility Regarding Payments to Trust Beneficiary When
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Company Is Insolvent
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(a) Trustee shall cease payment of benefits to Plan participants and
their beneficiaries if the Company is Insolvent. Company shall be considered
"Insolvent" for purposes of this Trust Agreement if (i) Company is unable to pay
its debts as they become due, or (ii) Company is subject to a pending proceeding
as a debtor under the United States Bankruptcy Code.
(b) At all times during the continuance of this Trust, as provided in
Section 1(d) hereof, the principal and income of the Trust shall be subject to
claims of general creditors of Company under federal and state law as set forth
below.
1. The Board of Directors and the Chief Executive Officer of
Company shall have the duty to inform Trustee in writing of Company's
Insolvency. If a person claiming to be a creditor of Company alleges in writing
to Trustee that Company has become Insolvent, Trustee shall determine whether
Company is Insolvent and, pending such determination, Trustee shall discontinue
payment of benefits to Plan participants or their beneficiaries.
2. Unless Trustee has actual knowledge of Company's Insolvency,
or has received notice from Company or a person claiming to be a creditor
alleging that Company is Insolvent, Trustee shall have no duty to inquire
whether Company is Insolvent. Trustee may in all events rely on such evidence
concerning Company's solvency as may be furnished to Trustee and that provides
Trustee with a reasonable basis for making a determination concerning Company's
solvency.
3. If at any time Trustee has determined that Company is
Insolvent, Trustee shall discontinue payments to Plan participants or their
beneficiaries and shall hold the assets of the Trust for the benefit of
Company's general creditors. Nothing in this Trust Agreement shall in any way
diminish any rights of Plan participants or their beneficiaries to pursue their
rights as general creditors of Company with respect to benefits due under the
Plan or otherwise.
4. Trustee shall resume the payment of benefits to Plan
participants or their beneficiaries in accordance with Section 2 of this Trust
Agreement only after Trustee has determined that Company is not Insolvent or is
no longer Insolvent.
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(c) Provided that there are sufficient assets, if Trustee
discontinues the payment of benefits from the Trust pursuant to Section 3(b)
hereof and subsequently resumes such payments, the first payment following such
discontinuance shall include the aggregate amount of all payments due to Plan
participants or their beneficiaries under the terms of the Plan for the period
of such discontinuance, less the aggregate amount of any payments made to Plan
participants or their beneficiaries by Company in lieu of the payments provided
for hereunder during any such period of discontinuance.
Section 4. Payments to Company
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Except as provided in Section 3 hereof, after the Trust has become
irrevocable, Company shall have no right or power to direct Trustee to return to
Company or to divert to others any of the Trust assets before all payment of
benefits have been made to Plan participants and their beneficiaries pursuant to
the terms of the Plan.
Section 5. Investment Authority
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Under Company's advisement and direction, Trustee may invest in
securities (including stock or rights to acquire stock) or obligations issued by
Company. All rights associated with assets of the Trust shall be exercised by
Trustee or the person designated by Trustee, and shall in no event be
exercisable by or rest with Plan participants, except that voting rights and
dividend rights with respect to Trust assets will be exercised by Company.
Company shall have the right at any time, and from time to time in its
sole discretion, to substitute assets of equal fair market value for any asset
held by the Trust. This right is exercisable by Company in a nonfiduciary
capacity without the approval or consent of any person in a fiduciary capacity.
Section 6. Disposition of Income
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During the term of this Trust, all income received by the Trust, net of
expenses and taxes, shall be accumulated and reinvested.
Section 7. Accounting by Trustee
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Following any funding of the Trust in excess of the amount set forth in
Section 1(a) hereof, Trustee shall keep accurate and detailed records of all
investments, receipts, disbursements, and all other transactions required to be
made, including such specific records as shall be agreed upon in writing between
Company and Trustee. Within 30 days following the close of each calendar year
and within 30 days after the removal or resignation of Trustee, Trustee shall
deliver to Company a written account of its administration of the Trust during
such year or during the period from the close of the last preceding year to the
date of such removal or resignation, setting forth all investments, receipts,
disbursements and other transactions effected by it, including a description of
all securities and investments purchased and sold with the cost or
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net proceeds of such purchases or sales (accrued interest paid or receivable
being shown separately), and showing all cash, securities and other property
held in the Trust at the end of such year or as of the date of such removal or
resignation, as the case may be.
Section 8. Responsibility of Trustee
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(a) Trustee shall act with the care, skill, prudence and diligence
under the circumstances then prevailing that a prudent person acting in like
capacity and familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims, provided, however, that
Trustee shall incur no liability to any person for any action taken pursuant to
a direction, request or approval given by Company which is contemplated by, and
in conformity with, the terms of the Plan or this Trust and is given in writing
by Company. In the event of a dispute between Company and a party, Trustee may
apply to a court of competent jurisdiction to resolve the dispute.
(b) Trustee shall have, without exclusion, all powers conferred on
Trustees by applicable law, unless expressly provided otherwise herein,
provided, however, that if an insurance policy is held as an asset of the Trust,
Trustee shall have no power to name a beneficiary of the policy other than the
Trust, to assign the policy (as distinct from conversion of the policy to a
different form) other than to a successor Trustee, or to loan to any person the
proceeds of any borrowing against such policy.
(c) However, notwithstanding the provisions of Section 8(b) above,
Trustee may loan to Company the proceeds of any borrowing against an insurance
policy held as an asset of the Trust.
(d) Notwithstanding any powers granted to Trustee pursuant to this
Trust Agreement or to applicable law, Trustee shall not have any power that
could give this Trust the objective of carrying on a business and dividing the
gains therefrom, within the meaning of section 301.7701-2 of the Procedure and
Administrative Regulations promulgated pursuant to the Internal Revenue Code.
Section 9. Compensation and Expenses of Trustee
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Company shall pay all administrative and Trustee's fees and expenses. If
not so paid, the fees and expenses shall be paid from the Trust.
Section 10. Resignation and Removal of Trustee
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(a) Trustee may resign at any time by written notice to Company,
which shall be effective thirty (30) days after receipt of such notice unless
Company and Trustee agree otherwise.
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(b) Trustee may be removed by Company on thirty (30) days notice or
upon shorter notice accepted by Trustee.
(c) Upon resignation or removal of Trustee and appointment of a
successor Trustee, all assets shall subsequently be transferred to the successor
Trustee. The transfer shall be completed within thirty (30) days after receipt
of notice of resignation, removal or transfer, unless Company extends the time
limit.
(d) If Trustee resigns or is removed, a successor shall be appointed,
in accordance with Section 11 hereof, by the effective date of resignation or
removal under paragraphs (a) or (b) of this section. If no such appointment has
been made, Trustee may apply to a court of competent jurisdiction for
appointment of a successor or for instructions. All expenses of Trustee in
connection with the proceeding shall be allowed as administrative expenses of
the Trust.
Section 11. Appointment of Successor
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If Trustee resigns or is removed in accordance with Section 10(a) or (b)
hereof, Company may appoint any third party, such as a bank trust department or
other party that may be granted corporate trustee powers under state law, as a
successor to replace Trustee upon resignation or removal. The appointment shall
be effective when accepted in writing by the new Trustee, who shall have all of
the rights and powers of the former Trustee, including ownership rights in the
Trust assets. The former Trustee shall execute any instrument necessary or
reasonably requested by Company or the successor Trustee to evidence the
transfer.
Section 12. Amendment or Termination
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(a) This Trust Agreement may be amended by a written instrument
executed by Trustee and Company. Notwithstanding the foregoing, no such
amendment shall conflict with the terms of the Plan or shall make the Trust
revocable after it has become irrevocable in accordance with Section 1(b)
hereof.
(b) The Trust shall not terminate until the date on which Plan
participants and their beneficiaries are no longer entitled to benefits pursuant
to the terms of the Plan unless sooner revoked in accordance with Section 1(b)
hereof. Upon termination of the Trust any assets remaining in the Trust shall be
returned to Company.
(c) Upon written approval of participants or beneficiaries entitled
to payment of benefits pursuant to the terms of the Plan, Company may terminate
this Trust prior to the time all benefit payments under the Plan have been made.
All assets in the Trust at termination shall be returned to Company.
Section 13. Miscellaneous
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(a) Any provision of this Trust Agreement prohibited by law shall be
ineffective to the extent of any such prohibition, without invalidating the
remaining provisions hereof.
(b) Benefits payable to Plan participants and their beneficiaries
under this Trust Agreement may not be anticipated, assigned (either at law or in
equity), alienated, pledged, encumbered or subjected to attachment, garnishment,
levy, execution or other legal or equitable process.
(c) This Trust Agreement shall be governed by and construed in
accordance with the laws of the State of Ohio.
Section 14. Effective Date
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The effective date of this Trust Agreement shall be October 1, 1999.
FOREST CITY ENTERPRISES, INC.
By: ____________________________________
Name: Thomas G. Smith
Its: Chief Financial Officer, Senior Vice
President and Secretary
TRUSTEE
By: ____________________________________
Name: ____________________________________
Its: ____________________________________
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