SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
(Date of earliest event reported): March 17, 2000
SNAP-ON INCORPORATED
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(Exact name of Registrant as specified in its charter)
DELAWARE 1-7724 39-0622040
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State of Commission File IRS Employer
Incorporation No. Identification No.
2801 80TH Street
Kenosha, Wisconsin 53141-1410
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(Address of principal executive offices, including zip code)
(262) 656-5200
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(Registrant's telephone number, including area code)
N/A
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(Former name or former address, if changed since last report)
Item 5. Other Events
Effective March 17, 2000, the Benefit Trust Agreement (the
"Original GSOP Agreement"), dated July 2, 1998, between Snap-on
Incorporated (the "Company") and the Northern Trust Company, as trustee,
which established the Company's grantor stock ownership program (the
"GSOP") was amended to reflect certain amendments to the provisions
regarding the distribution of GSOP assets upon termination of the GSOP and
the provisions governing voting and tendering of shares of the Company's
common stock held in the GSOP.
The first set of amendments was approved by the board of
directors of the Company to include clarifying language relating to the
disposition of GSOP assets upon termination of the GSOP in order to more
accurately reflect the intent of the Company when it entered into the
Original GSOP Agreement, and a copy of the first set of amendments is filed
herewith as Exhibit 99.1. The amendments relating to the voting and
tendering provisions of the Original GSOP Agreement were approved by the
Eligible Participants (as defined in the Original GSOP Agreement) in
accordance with the terms of the Original GSOP Agreement. As a result of
these amendments, the shares of the Company's common stock that are held in
the GSOP generally will be voted and tendered in proportion to the voting
and tendering of shares of the Company's common stock held outside of the
GSOP by the general stockholder population. A copy of the second set of
amendments is filed herewith as Exhibit 99.2.
The Company has amended and restated the Original GSOP
Agreement (as amended and restated, the "Amended and Restated GSOP
Agreement")to incorporate the aforementioned amendments, and such Amended
and Restated GSOP Agreement is filed herewith as Exhibit 99.3.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
Exhibit No. Description
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99.1 Amendment No.1 to the Benefit Trust Agreement between
Snap-on Incorporated and The Northern Trust Company, as
trustee, as approved by the board of directors of Snap-on
Incorporated, effective as of March 17, 2000.
99.2 Amendment No.2 to the Benefit Trust Agreement between
Snap-on Incorporated and The Northern Trust Company, as
trustee, as approved by the Eligible Participants (as
defined therein), effective as of March 17, 2000.
99.3 Amended and Restated Benefit Trust Agreement, dated July
2, 1998 and amended and restated as of March 17, 2000,
between Snap-on Incorporated and The Northern Trust
Company, as Trustee.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned, hereunto duly authorized.
SNAP-ON INCORPORATED
By: /s/ Susan F. Marrinan
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Name: Susan F. Marrinan
Title: Vice President, Secretary
and General Counsel
Dated: April 4, 2000
INDEX TO EXHIBITS
Exhibit No. Description Page No.
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99.1 Amendment No.1 to the Benefit Trust Agreement 6
between Snap-on Incorporated and The Northern Trust
Company, as trustee, as approved by the board of
directors of Snap-n Incorporated, effective as of March
17, 2000.
99.2 Amendment No.2 to the Benefit Trust Agreement 7
between Snap-on Incorporated and The Northern
Trust Company, as trustee, as approved by the
Eligible Participants (as defined therein), effective
as of March 17, 2000.
99.3 Amended and Restated Benefit Trust Agreement, 11
dated July 2, 1998, and amended and restated as of
March 17, 2000, between Snap-on Incorporated
and The Northern Trust Company, as trustee.
Exhibit 99.1
AMENDMENT TO THE SNAP-ON INCORPORATED BENEFIT TRUST
AGREEMENT FOR THE GRANTOR TRUST STOCK OWNERSHIP PROGRAM
The last clause of the penultimate sentence of Section 6.1 of the
Trust Agreement shall be amended to read in its entirety as follows:
; and thereafter, any remaining shares of Common Stock or other
assets constituting the Trust Corpus shall be transferred to the
Director to be used (as determined by the Committee, taking into
account the best interests of a broad cross-section of employees of
the Company) solely to fund or provide benefits to employees of the
Company under separately established, bona fide Company compensation
or benefit plans and for contractual or other compensation or benefit
obligations of the Company (other than Plans), it being understood
that this Trust creates no rights derived from an underlying,
independent compensation or benefit plan or contractual or other
compensation or benefit obligation of the Company.
The following sentence shall be inserted immediately preceding the
last sentence of Section 6.1 of the Trust Agreement:
For purposes of the Committee's determination as to the application
of the Trust Corpus upon termination of the Trust, only compensation
or benefit obligations that arise legitimately in the ordinary course
of business of the Company shall be deemed "bona fide."
Exhibit 99.2
AMENDMENT TO
SNAP-ON INCORPORATED
BENEFIT TRUST AGREEMENT
AMENDMENT, dated as of March 17, 2000, by and between Snap- on
Incorporated, a Delaware corporation (the "Company"), and The Northern
Trust Company (the "Trustee"), as trustee of the trust created by the
Benefit Trust Agreement dated July 2, 1998, between the Company and the
Trustee, as amended to date (the "Trust Agreement").
WHEREAS, the Company and the Trustee are parties to the Trust
Agreement, under which a trust has been created for the purpose of
providing a source for the satisfaction, in whole or in part, of the
contractual obligations of the Company under the Plans (as defined in the
Trust Agreement);
WHEREAS, the Company desires to amend the Trust Agreement in
certain respects; and
WHEREAS, pursuant to Section 6.2(b)(4) of the Trust Agreement,
the amendments set forth in paragraphs 1 and 2 below (collectively, the
"Amendments") shall be subject to the approval (the "Participant Approval")
of Eligible Participants (as defined in the Trust Agreement) who, as of
February 17, 2000, have the right to direct the Trustee with respect to
more than fifty percent (50%) of the aggregate number of Directed Shares
(as currently defined in the Trust Agreement).
NOW, THEREFORE, in consideration of the mutual agreements
contained herein and for other good and valuable considerations, the
parties hereby agree as follows:
1. Section 4.4(a) of the Trust Agreement is hereby restated in its
entirety, to read as follows:
"(a) Voting of Common Stock.. The Trustee shall vote (or act by
written consent with respect to) the shares of Common Stock
held by the Trust in accordance with the provisions of this
Section 4.4(a). As soon as practicable following the record
date in question, the Company shall deliver to the Trustee a
schedule (the "Eligible Participant Schedule") listing (1) all
persons other than members of the Board of Directors
(collectively, "Eligible Participants") with respect to whom
shares of Common Stock are deliverable as of such record
date as a result of (x) purchases by such Eligible
Participants pursuant to the Company's Employee Stock
Ownership Plan or Franchised Dealer Stock Ownership Plan,
including any successor or substitute stock purchase plans
as may be listed on Exhibit A from time to time
(collectively, the "Stock Purchase Plans"), or (y) the
exercise of stock options granted to such Eligible
Participants pursuant to the Company's Amended and Restated
Snap-on Incorporated 1986 Incentive Stock Program, as
amended from time to time, including any successor or
substitute stock incentive or option plans as may be listed
on Exhibit A from time to time (such plans, the "Stock
Option Plan") and (2) the number of Directed Shares (as
hereinafter defined) with respect to which each Eligible
Participant is entitled to direct the voting. Each Eligible
Participant listed on such Eligible Participant Schedule
shall have the right to direct the vote (or written consent)
with respect to that number of shares of Common Stock held
by the Trust as of such record date (such number being
hereinafter referred to as the "Directed Shares") which is
equal to the number of shares then deliverable to such
Eligible Participant as a result of purchases by such
Eligible Participant under the Stock Purchase Plans or the
exercise by such Eligible Participant of stock options
granted under the Stock Option Plan and shall also furnish
to the Trustee such further information as the Trustee
determines is necessary for it to perform its
responsibilities under this Section 4.4(a). If an Eligible
Participant provides directions to the Trustee with respect
to the voting of (or action by written consent with respect
to) his or her Directed Shares, the Trustee shall vote (or
act by written consent with respect to), or abstain or
withhold authority with respect to, as applicable, shares of
Common Stock held by the Trust as of such record date which
are equal in number to such Directed Shares in accordance
with the directions of such Eligible Participant. With
respect to (1) shares of Common Stock held by the Trust as
of such record date which are equal to the aggregate number
of Directed Shares with respect to which the Trustee has not
received directions from Eligible Participants and (2)
shares of Common Stock held in the Trust as of such record
date which are in excess of the aggregate number of Directed
Shares (the shares referred to in (1) and (2) being
collectively referred to as the "Mirrored Shares"), the
number of Mirrored Shares to be voted in a particular manner
(or acted upon by written consent) or abstaining or
withholding authority, as the case may be, with respect to a
particular matter shall equal to product of (x) the total
number of Mirrored Shares held by the Trust as of such
record date and (y) a fraction the numerator of which is the
aggregate number of shares of Common Stock voted in such
manner (or acted upon by written consent) or abstaining or
withholding authority, as the case may be, with respect to
such matter by all stockholders of the Company (other than
the Trust) and the denominator of which is the aggregate
number of outstanding shares of Common Stock held by all
stockholders of the Company (other than the Trust). The
Trustee shall devise and implement a procedure to assure
confidentiality of any directions given by Eligible
Participants in respect of votes. All actions taken by
Eligible Participants pursuant to this Section 4.4(a) shall
be held confidential by the Trustee and shall not be
divulged or released to any person, other than (i) agents of
the Trustee who are not affiliated with the Company or its
affiliates, (ii) by virtue of the execution by the Trustee
of any proxy, consent or letter of transmittal for the
shares of Common Stock held in the Trust, (iii) as may be
required by court order or (iv) as otherwise necessary for
the Trustee to carry out its responsibilities under this
Agreement."
2. The second sentence of Section 4.4(b) of the Trust Agreement is
hereby deleted and replaced with the following:
"As soon as practicable following the commencement of such
tender or exchange offer, the Company shall deliver to the
Trustee an Eligible Participant Schedule listing the Eligible
Participants as of the Commencement of such tender or exchange
offer and the number of Directed Shares with respect to which
each Eligible Participant is entitled to direct the tender or
exchange and shall also furnish to the Trustee such further
information as the Trustee determines is necessary for it to
perform its responsibilities under this Section 4.4(b)."
3. The fourth sentence of Section 4.4(b) of the Trust Agreement is
hereby deleted and replaced with the following:
"The number of Mirrored Shares (as defined in Section 4.4(a)
above) to be tendered or exchanged shall equal the product of
(1) the total number of Mirrored Shares held by the Trust as of
the expiration date of such tender or exchange offer and (2) a
fraction the numerator of which is the aggregate number of
shares of Common Stock tendered or exchanged by all
stockholders of the Company (other than the Trust) and the
denominator of which is the aggregate number of outstanding
shares of Common Stock held by all stockholders of the
Company (other than the Trust)."
4. Subject to Participant Approval of the Amendments, clause
(4) of Section 6.2(b) of the Trust Agreement is hereby deleted and replaced
with the following:
"(4) this Trust Agreement may be amended in any respect (other
than to permit the Company to receive any distribution of the
Trust Corpus except in repayment of unpaid principal and
interest due under the Note or any subsequent indebtedness
incurred by the Trustee), so long as such amendment has been
approved by the affirmative vote of Eligible Participants (as
defined in this Trust Agreement as in effect prior to March 17,
2000) who, as of a date not earlier than thirty (30) days prior
to the date of such amendment, have the right to direct the
Trustee with respect to more than fifty percent (50%) of the
aggregate number of Directed Shares (as defined in this Trust
Agreement as in effect prior to March 17, 2000)."
5. The Amendments shall be effective as of March 17, 2000, but
only if the Participant Approval shall have been obtained prior to such
date. In the absence of such Participant Approval, the Amendments shall be
null and void.
6. Except as amended hereby, the Trust Agreement shall remain in
full force and effect.
IN WITNESS WHEREOF, the parties have caused this Amendment to
be executed in their respective names by their duly authorized officers as
of the day and year first above written.
SNAP-ON INCORPORATED
By: /s/ Susan F. Marrinan
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Name: Susan F. Marrinan
Title: Vice President, Secretary
and General Counsel
Consent:
THE NORTHERN TRUST COMPANY
solely in its capacity as trustee under this
Trust Agreement
By: /s/ M. Curtis Pence
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Name: M. Curtis Pence
Title: Vice President
Exhibit 99.3
SNAP-ON INCORPORATED
AMENDED AND RESTATED
BENEFIT TRUST AGREEMENT
AMENDED AND RESTATED BENEFIT TRUST AGREEMENT
("Trust Agreement"), dated July 2, 1998 (referred to herein as "the date
hereof") and amended and restated as of March 17, 2000, by and between
Snap-on Incorporated, a Delaware corporation (the "Company"), and The
Northern Trust Company, as trustee of the Trust created hereby (the
"Trustee").
WHEREAS, the Company is or may become obligated in respect of
its existing compensation and benefit plans, agreements, programs,
arrangements and practices listed on Exhibit A attached hereto and such
existing and future plans, agreements, programs, arrangements and practices
as may hereafter be listed on said Exhibit A (the plans, agreements,
programs, arrangements and practices listed on said Exhibit A from time to
time being collectively referred to herein as the "Plans") to make payments
to or contributions on behalf of its past, present or future employees and
franchise dealers or their beneficiaries; and
WHEREAS, for purposes of providing a source for the
satisfaction, in whole or in part, of the contractual obligations of the
Company under the Plans, the Company desires to establish a trust (the
"Trust"), which is intended to constitute a grantor trust within the
meaning of Section 671 of the Internal Revenue Code of 1986, as amended
(the "Code"), the assets of which shall be subject to the claims of the
Company's existing or future creditors;
WHEREAS, the Company desires that the assets to be held in the
Trust should be principally or exclusively securities of the Company and,
therefore, expressly waives any diversification of investments that might
otherwise be necessary, appropriate or required pursuant to applicable law.
NOW, THEREFORE, in consideration of the mutual agreements
contained herein and for other good and valuable consideration, the parties
hereto agree as follows:
ARTICLE I
PURPOSE OF THE TRUST
SECTION 1.1 Purpose. (a) The purpose of the Trust is to hold
shares of Common Stock of the Company, par value $1.00 per share ("Common
Stock"), or other property as herein provided as a source to satisfy the
Company's contractual obligations under the Plans.
(b) The Company shall continue to be liable to make all
payments and deliver shares of Common Stock as required of the Company
under the terms of the Plans to the extent such payments have not been made
or such shares of Common Stock have not been delivered pursuant to this
Trust Agreement. Distributions made from the Trust in respect of the Plans
pursuant to Section 3.1 shall, to the extent of such distributions, satisfy
the Company's contractual obligations under the Plans.
ARTICLE II
TRUST AND THE TRUST CORPUS
SECTION 2.1 Delivery of Funds and Common Stock. (a)
Concurrently with the execution of this Trust Agreement, the Company is
selling to the Trustee from the Company's treasury stock an aggregate of
7,100,000 shares (the "Acquired Shares") of Common Stock, pursuant to the
terms of a Stock Purchase Agreement, dated the date hereof, between the
Company and the Trustee (the "Stock Purchase Agreement"), such Acquired
Shares (including earnings thereon and proceeds realized from the sale,
exchange or other disposition of such Acquired Shares) to constitute
collateral for the repayment of the Note (as defined below) until released
from collateral as provided herein and otherwise to be held, administered
and disposed of by the Trustee as provided herein. Concurrently with the
execution of this Trust Agreement, and pursuant to the terms of the Stock
Purchase Agreement, the Trustee is delivering to the Company, on behalf of
the Trust, a Note (the "Note") of the Trust in the original principal
amount of $260,037,500, in payment of the purchase price for the Acquired
Shares, such purchase price having been determined by the Company based on
the closing price per share of Common Stock on the New York Stock Exchange
on the business day immediately preceding the sale of the Acquired Shares
to the Trustee.
(b) The Company may sell or otherwise deliver to the
Trustee additional shares of Common Stock, to be held in trust hereunder.
(c) Except as otherwise provided herein, all cash
dividends paid in respect of shares of Common Stock held in the Trust shall
be invested in Cash Equivalents.
SECTION 2.2 Contributions to Repay Trust Indebtedness. The
Company shall contribute to the Trust in cash an amount which, when added
to cash dividends and other proceeds received by the Trust in respect of
Acquired Shares (or other shares of Common Stock) held in the Trust and not
previously applied under this Section 2.2, shall enable the Trustee to make
payments of principal and interest due under the Note on a timely basis or
to make mandatory or optional prepayments of such principal or interest.
The Trustee shall promptly apply all cash dividends paid in respect of
Acquired Shares (or other shares of Common Stock held in the Trust) and all
cash contributions to the payment of principal and interest under the Note,
whether mandatory or optional in nature. To the extent the Company fails to
make any contribution required under this Section 2.2 when due, such
contribution shall be deemed to have been made in the form of forgiveness
of principal and interest then due and owing on the Note (or forgiveness of
principal and interest to the extent of any mandatory or optional
prepayment, as the case may be). The Trustee shall be accountable for all
contributions received by it, but shall have no duty to require any
contributions to be made to it. The Committee (as hereinafter defined)
shall provide timely notice to the Trustee regarding each dividend payment
and each contribution to be made (or deemed to be made) pursuant to this
Section 2.2.
SECTION 2.3 Trust Corpus. As used herein, the term "Trust
Corpus" shall mean any cash, Cash Equivalents or shares of Common Stock
delivered, sold or otherwise contributed to the Trustee as described in
Section 2.1 or 2.2 hereof, together with any dividends or earnings thereon
or any proceeds from the disposition thereof, plus any cash or Cash
Equivalents or shares of Common Stock sold or otherwise delivered
thereafter pursuant to Section 2.1 or 2.2 hereof, together with any
earnings thereon or any proceeds from the disposition thereof (and less
such amounts distributed from the Trust pursuant to the terms hereof). As
used herein, the term "Cash Equivalents" shall mean securities issued or
directly and fully guaranteed by the United States or any agency or
instrumentality thereof (provided that the full faith and credit of the
United States is pledged in support thereof) having maturities of less than
one year from the date of acquisition or money market portfolios of
registered mutual funds, including those for which the Trustee or its
affiliates acts as investment advisor. The Trust Corpus shall at all times
be limited to shares of Common Stock and cash or Cash Equivalents.
ARTICLE III
RELEASE OF THE TRUST CORPUS
SECTION 3.1 Use of Assets. In accordance with the provisions
hereof and subject to Section 3.3 hereof, the Trustee shall apply the Trust
Corpus (1) to the payment of outstanding principal and interest on the
Note, in accordance with the terms thereof, (2) on behalf of the Company to
the satisfaction of the Company's contractual obligations under the Plans
in accordance with Section 3.2 hereof, (3) to the acquisition of additional
shares of Common Stock pursuant to Section 2.1(b) hereof, or (4) otherwise
as provided in Section 6.1 upon termination of the Trust.
SECTION 3.2 Release from Collateral. (a) On each date on which
payment is made (or deemed to have been made) of any principal amount of
the Note (a "Principal Payment Date"), the following number of Acquired
Shares (and related collateral) shall be released from collateral: the
number of Acquired Shares held in the Trust as collateral immediately prior
to the Principal Payment Date multiplied by a fraction, the numerator of
which is the amount of the principal payment made (or deemed to have been
made) on such date and the denominator of which is the principal amount of
the Note outstanding immediately prior to such principal payment. The
Trustee may confirm with the Committee the number of Acquired Shares to be
released, and if it does so, it may rely upon such confirmation. The shares
of Common Stock and related collateral released pursuant to this Section
3.2 shall thereafter be available for application by the Trustee for the
purposes specified in Section 3.1 above. Any shares of Common Stock
subsequently acquired by the Trust which do not constitute collateral for
any borrowing of the Trust shall become available for use under Section
3.2(b) in the same proportion as the Acquired Shares are released from
collateral, as described above.
(b) The shares of Common Stock released from collateral
(or otherwise becoming available for use hereunder) at any time (1) first,
shall be transferred to the Administrator (as hereinafter defined) of the
Stock Purchase Plans (as defined in Section 4.4(a) hereof) to the extent
necessary to satisfy the Company's obligations under the Stock Purchase
Plans, (2) second, to the extent such shares of Common Stock remain after
the transfer provided for in clause (1), shall be transferred to the
Administrator of the Stock Option Plan (as defined in Section 4.4(a)
hereof) to the extent necessary to satisfy the Company's obligations under
the Stock Option Plan, and (3) thereafter, to the extent such shares of
Common Stock remain after the transfers provided for in clauses (1) and
(2), shall be transferred to the Director (as hereinafter defined) or
Administrators to satisfy the Company's obligations under such Plans as
determined by the Committee (as hereinafter defined), taking into account
the best interests of a broad cross-section of Participants.
(c) The Committee shall inform the Trustee in writing of
how many shares are required to fund the obligations referred to in clauses
(1),(2) and (3) of Section 3.2(b) above. The Trustee may rely upon written
instructions received from the Committee to carry out the provisions
contained in Section 3.2(b) above and shall have no responsibility to
verify, review or monitor the determinations made by the Committee.
(d) For purposes of this Trust Agreement, (1) the term
"Committee" shall mean a committee comprised of the Chief Financial
Officer, Chief Legal Officer and Director-Corporate Benefits of the Company
(the members of the Committee shall be certified to the Trustee by the
Secretary or Assistant Secretary of the Company); (2) the term
"Administrator" shall refer to the committee, Company official(s) or other
persons listed on Exhibit A charged with responsibility for overseeing and
administering the particular Plan or the designee thereof (as disclosed in
writing to the Trustee); and (3) the term "Director" shall mean the
Director-Corporate Benefits of the Company.
SECTION 3.3 Deliveries to Creditors of the Corporation. It is
the intent of the parties hereto that the Trust Corpus is and shall remain
at all times subject to the claims of the general creditors of the Company.
Accordingly, neither the Trustee nor the Company shall create a security
interest in the Trust Corpus in favor of the Plans, any participant therein
(each, a "Participant"), any beneficiary of such Participant (each, a
"Beneficiary") or any creditor. If the Trustee receives the notice provided
for in Section 3.4, or if the Trustee otherwise receives actual notice that
the Company is insolvent or bankrupt as defined in Section 3.4, the Trustee
shall make no further distributions of the Trust Corpus but shall deliver
the entire amount of the Trust Corpus only as a court of competent
jurisdiction, or duly appointed receiver or other person authorized to act
by such a court, may direct. The Trustee shall resume distribution of the
Trust Corpus under the terms hereof, upon no less than 30 days' advance
notice to the Company, if the Trustee determines that the Company was not,
or is no longer, bankrupt or insolvent. Such determination shall be made in
a timely fashion, and shall be based upon a decision of a court of
competent jurisdiction, a report of a nationally recognized appraisal firm
or a certification by the Chief Executive Officer of the Company or a
determination of the Board of Directors of the Company (the "Board"). The
Trustee may conclusively rely upon any such decision, report or
certification. Unless the Trustee has actual knowledge of the Company's
bankruptcy or insolvency, the Trustee shall have no duty to inquire whether
the Company is bankrupt or insolvent. In no event shall "actual knowledge"
be deemed to include knowledge of the Company's credit status held by
banking officers or banking employees of The Northern Trust Company which
has not been communicated to the trust department of the Trustee.
SECTION 3.4 Notification of Bankruptcy or Insolvency. The
Company shall advise the Trustee promptly in writing of the Company's
bankruptcy or insolvency. The Company shall be deemed to be bankrupt or
insolvent upon the occurrence of any of the following:
(i) the Company shall make an assignment for the
benefit of creditors; file a petition in bankruptcy; petition or
apply to any tribunal for the appointment of a custodian, receiver,
liquidator, sequestrator, or any trustee for it or a substantial part
of its assets; commence any case under any bankruptcy, insolvency,
reorganization, arrangement, readjustment of debt, dissolution,
liquidation or similar law or statute of any jurisdiction (federal or
state), whether now or hereafter in effect; or if there shall have
been filed any such petition or application, or any such case shall
have been commenced against it, in which an order for relief is
entered or which remains undismissed for a period of 120 days; or the
Company by any act or omission shall indicate its consent to,
approval of or acquiescence in any such petition, application or case
or order for relief or to the appointment of a custodian, receiver or
any trustee for it or any substantial part of any of its property, or
shall suffer any such custodianship, receivership or trusteeship to
continue undischarged for a period of 120 days; or
(ii) the Company shall generally not pay its debts
as such debts become due or shall cease to pay its debts generally in
the ordinary course of business.
ARTICLE IV
ADMINISTRATION OF TRUST FUND
SECTION 4.1 Trustee. (a) The duties and responsibilities of the
Trustee shall be limited to those expressly set forth in this Trust
Agreement and the Stock Purchase Agreement, and no implied covenants or
obligations shall be read into this Trust Agreement against the Trustee.
(b) If, under circumstances described in Section 3.4 or
otherwise, all or any part of the Trust Corpus is at any time attached,
garnished, or levied upon by any court order, or in case the payment,
assignment, transfer, conveyance or delivery of any such property shall be
stayed or enjoined by any court order, or in case any order, judgment or
decree shall be made or entered by a court affecting such property or any
part thereof, then and in any of such events the Trustee is authorized, in
its sole discretion, to rely upon and comply with any such order, writ,
judgment or decree, and it shall not be liable to the Company, any Plan or
any Participant or Beneficiary by reason of such compliance even though
such order, writ, judgment or decree subsequently may be reversed,
modified, annulled, set aside or vacated.
(c) The Trustee or its agent shall maintain such books,
records and accounts as may be necessary for the proper administration of
the Trust Corpus (and agreed to from time to time between the Company and
the Trustee), and shall render to the Committee, within 30 days of the end
of each fiscal quarter of the Company, commencing with the fiscal quarter
ending October 3, 1998, until the termination of the Trust (and on the date
of such termination or as promptly as practicable thereafter), an
accounting with respect to the Trust Corpus as of the end of the then most
recent fiscal quarter (and as of the date of such termination).
(d) The Trustee shall not be liable for any act taken or
omitted to be taken hereunder if taken or omitted to be taken by it in good
faith. The Trustee shall also be fully protected in relying upon any notice
or instruction given hereunder which it in good faith believes to be
genuine and executed and delivered in accordance with this Trust.
(e) The Trustee may consult with legal counsel to be
selected by it, including counsel to the Company, and the Trustee shall not
be liable for any action taken or omitted to be taken by it in good faith
in accordance with the advice of such counsel.
(f) The Trustee shall be reimbursed by the Company for
its reasonable expenses incurred in connection with the performance of its
duties hereunder and shall be paid reasonable fees for the performance of
such duties. Any amounts payable to the Trustee under this paragraph (f)
may be payable from the Trust Corpus if not paid by the Company.
(g) Except for any damages, losses, claims or expenses
resulting from the Trustee's gross negligence or willful misconduct, the
Company agrees to indemnify and hold harmless the Trustee from and against
any and all damages, losses, claims or expenses as incurred (including
reasonable expenses of investigation and reasonable fees, charges and
disbursements of counsel to the Trustee and any taxes imposed on the Trust
Corpus or income of the Trust) arising out of or in connection with the
performance by the Trustee of its duties hereunder, including (except as
otherwise provided in Section 4.4 hereof) the failure of the Trustee to act
in the absence of direction from the person or entity responsible for such
direction. Without limiting the generality of the foregoing, the Trustee
shall be under no liability to any person for (and the Company shall
indemnify and hold the Trustee harmless from and against) any loss of any
kind which may result by reason of any action taken by it pursuant to
Section 4.4 or by reason of its exercising any power or authority under
Section 4.4 or by reason of the purchase or retention of Common Stock.
(h) Subject to the provisions of this Trust Agreement,
the Trustee shall have the following additional powers and authority, in
furtherance of the purpose of the Trust as described in Section 1.1(a),
with respect to property constituting a part or all of the Trust Corpus:
(i) To acquire and hold shares of Common Stock and
cash or Cash Equivalents, and, subject to Section 4.3 hereof, to
sell, exchange or transfer any such property at public or private
sale for cash or on credit and grant options for the purchase or
exchange thereof;
(ii) To exercise any conversion privilege or
subscription right available in connection with any such property;
subject to Sections 4.3 and 4.4 hereof, to oppose or to consent to
the reorganization, consolidation, merger or readjustment of the
finances of any corporation, company or association, or to the sale,
mortgage, pledge or lease of the property of any corporation, company
or association, any of the securities of which may at any time be
held in the Trust and to do any act with reference thereto, including
the exercise of options, the making of agreements or subscriptions
and the payment of expenses, assessments or subscriptions, which may
be deemed necessary or advisable in connection therewith, and to hold
and retain any securities or other property which it may so acquire;
(iii) To commence or defend suits or legal
proceedings and to represent the Trust in all suits or legal
proceedings; to settle, compromise or submit to arbitration, any
claims, debts or damages, due or owing to or from the Trust;
(iv) Subject to Sections 4.3 and 4.4 hereof, to
exercise, personally or by general or limited power of attorney, any
right, including the right to vote, appurtenant to any shares of
Common Stock or other property;
(v) To engage legal counsel, including counsel to
the Company, or any other suitable agents, to consult with such
counsel or agents with respect to the construction of this Trust
Agreement, the duties of the Trustee hereunder, the transactions
contemplated by this Trust Agreement or any act which the Trustee
proposes to take or omit to take, to rely upon the advice of such
counsel or agents, and to pay its reasonable fees, expenses and
compensation;
(vi) To register any securities held by it in its
own name or in the name of any custodian of such property or of its
nominee, including the nominee of any system for the central handling
of securities, with or without the addition of words indicating that
such securities are held in a fiduciary capacity, to deposit or
arrange for the deposit of any such securities with such a system and
to hold any securities in bearer form;
(vii) To make, execute and deliver, as Trustee, any
and all deeds, leases, notes, bonds, guarantees, mortgages,
conveyances, contracts, waivers, proxies, releases or other
instruments in writing necessary or proper for the exercise of any of
the foregoing powers; and
(viii)To take any other action necessary or
advisable in furtherance of the foregoing powers and the purposes of
this Trust.
SECTION 4.2 Successor Trustee. The Trustee may resign and be
discharged from its duties hereunder at any time by giving to the Company
notice in writing of such resignation specifying a date (not less than 30
days after the giving of such notice) when such resignation shall take
effect. Promptly after such notice, the Company shall appoint an
independent financial institution as successor trustee, such trustee to
become Trustee hereunder upon the resignation date specified in such
notice. The Trustee shall continue to serve until its successor accepts the
trust and receives delivery of the Trust Corpus. The Company may at any
time substitute an independent financial institution as successor trustee
by giving 15 days' notice thereof to the Trustee then acting. In the event
of such removal or resignation, the Trustee shall duly file with the
Committee a written statement or statements of account as provided in
Section 4.1(c) for the period since the last previous accounting of the
Trust, and if written objection to such account is not filed within 90
days, the Trustee shall to the maximum extent permitted by applicable law
be forever released and discharged from all liability and accountability
with respect to the propriety of its acts and transactions shown in such
account.
SECTION 4.3 Limitations on Sales and Borrowings. Except as
otherwise provided in Sections 3.2, 3.3, 4.4 and 6.1 hereof, the Trustee
shall not sell, exchange or transfer any shares of Common Stock or grant
any option for the purchase or exchange of any shares of Common Stock.
Except as contemplated by Section 2.1(a) hereof, the Trustee shall not
incur any indebtedness in connection with the acquisition of shares of
Common Stock.
SECTION 4.4 Voting and Tendering of Common Stock.
(a) (1) Voting of Common Stock.. The Trustee shall vote
(or act by written consent with respect to) the shares of Common Stock held
by the Trust in accordance with the provisions of this Section 4.4(a). As
soon as practicable following the record date in question, the Company
shall deliver to the Trustee a schedule (the "Eligible Participant
Schedule") listing (1) all persons other than members of the Board of
Directors (collectively, "Eligible Participants") with respect to whom
shares of Common Stock are deliverable as of such record date as a result
of (x) purchases by such Eligible Participants pursuant to the Company's
Employee Stock Ownership Plan or Franchised Dealer Stock Ownership Plan,
including any successor or substitute stock purchase plans as may be listed
on Exhibit A from time to time (collectively, the "Stock Purchase Plans"),
or (y) the exercise of stock options granted to such Eligible Participants
pursuant to the Company's Amended and Restated Snap-On Incorporated 1986
Incentive Stock Program, as amended from time to time, including any
successor or substitute stock incentive or option plans as may be listed on
Exhibit A from time to time (such plans, the "Stock Option Plan") and (2)
the number of Directed Shares (as hereinafter defined) with respect to
which each Eligible Participant is entitled to direct the voting. Each
Eligible Participant listed on such Eligible Participant Schedule shall
have the right to direct the vote (or written consent) with respect to that
number of shares of Common Stock held by the Trust as of such record date
(such number being hereinafter referred to as the "Directed Shares") which
is equal to the number of shares then deliverable to such Eligible
Participant as a result of purchases by such Eligible Participant under the
Stock Purchase Plans or the exercise by such Eligible Participant of stock
options granted under the Stock Option Plan and shall also furnish to the
Trustee such further information as the Trustee determines is necessary for
it to perform its responsibilities under this Section 4.4(a). If an
Eligible Participant provides directions to the Trustee with respect to the
voting of (or action by written consent with respect to) his or her
Directed Shares, the Trustee shall vote (or act by written consent with
respect to), or abstain or withhold authority with respect to, as
applicable, shares of Common Stock held by the Trust as of such record date
which are equal in number to such Directed Shares in accordance with the
directions of such Eligible Participant. With respect to (1) shares of
Common Stock held by the Trust as of such record date which are equal to
the aggregate number of Directed Shares with respect to which the Trustee
has not received directions from Eligible Participants and (2) shares of
Common Stock held in the Trust as of such record date which are in excess
of the aggregate number of Directed Shares (the shares referred to in (1)
and (2) being collectively referred to as the "Mirrored Shares"), the
number of Mirrored Shares to be voted in a particular manner (or acted upon
by written consent) or abstaining or withholding authority, as the case may
be, with respect to a particular matter shall equal to product of (x) the
total number of Mirrored Shares held by the Trust as of such record date
and (y) a fraction the numerator of which is the aggregate number of shares
of Common Stock voted in such manner (or acted upon by written consent) or
abstaining or withholding authority, as the case may be, with respect to
such matter by all stockholders of the Company (other than the Trust) and
the denominator of which is the aggregate number of outstanding shares of
Common Stock held by all stockholders of the Company (other than the
Trust). The Trustee shall devise and implement a procedure to assure
confidentiality of any directions given by Eligible Participants in respect
of votes. All actions taken by Eligible Participants pursuant to this
Section 4.4(a) shall be held confidential by the Trustee and shall not be
divulged or released to any person, other than (i) agents of the Trustee
who are not affiliated with the Company or its affiliates, (ii) by virtue
of the execution by the Trustee of any proxy, consent or letter of
transmittal for the shares of Common Stock held in the Trust, (iii) as may
be required by court order or (iv) as otherwise necessary for the Trustee
to carry out its responsibilities under this Agreement.
(b) Tender or Exchange of Common Stock. If any person
shall commence a tender or exchange offer with respect to the Common Stock,
the Trustee shall tender or exchange the shares of Common Stock held by the
Trust in accordance with the provisions of this Section 4.4(b). As soon as
practicable following the commencement of such tender or exchange offer,
the Company shall deliver to the Trustee an Eligible Participant Schedule
listing the Eligible Participants as of the Commencement of such tender or
exchange offer and the number of Directed Shares with respect to which each
Eligible Participant is entitled to direct the tender or exchange and shall
also furnish to the Trustee such further information as the Trustee
determines is necessary for it to perform its responsibilities under this
Section 4.4(b). Each Eligible Participant listed on such Eligible
Participant Schedule shall have the right to direct the tender or exchange
of that number of shares of Company Stock held by the Trust equal to the
number of Directed Shares (as defined in Section 4.4(a) above); and if an
Eligible Participant provides directions to the Trustee with respect to the
tender or exchange of his or her Directed Shares, the Trustee shall tender
or exchange shares of Common Stock held by the Trust which are equal in
number to such Directed Shares in accordance with the directions of such
Eligible Participant. The number of Mirrored Shares (as defined in Section
4.4(a) above) to be tendered or exchanged shall equal the product of (1)
the total number of Mirrored Shares held by the Trust as of the expiration
date of such tender or exchange offer and (2) a fraction the numerator of
which is the aggregate number of shares of Common Stock tendered or
exchanged by all stockholders of the Company (other than the Trust) and the
denominator of which is the aggregate number of outstanding shares of
Common Stock held by all stockholders of the Company (other than the
Trust). The Trustee shall devise and implement a procedure to assure the
confidentiality of any directions given by Eligible Participants in
response to such offers. All actions taken by Eligible Participants
pursuant to this Section 4.4(b) shall be held confidential by the Trustee
and shall not be divulged or released to any person, other than (i) agents
of the Trustee who are not affiliated with the Company or its affiliates,
(ii) by virtue of the execution by the Trustee of any proxy, consent or
letter of transmittal for the shares of Common stock held in the Trust,
(iii) as may be required by court order or (iv) as otherwise necessary for
the Trustee to carry out its responsibilities under this Agreement.
(c) Notices and Information Statements. In addition to
the information required to be provided by the Committee pursuant to
Sections 4.4(a) and 4.4(b) hereof, the Committee shall provide the Trustee
in a timely manner with notices and information statements (including proxy
statements) when voting rights are to be exercised, and with respect to
tender, exchange or similar offers, notices and offer materials, at the
same time and in the same manner (except to the extent the Securities
Exchange Act of 1934, as amended (the "Exchange Act") requires otherwise)
as such notices, information statements and offer materials are provided to
shareholders of the Company generally. The Trustee shall, in turn, provide
to Eligible Participants all material received from the Committee pursuant
to this Section 4.4(c).
ARTICLE V
CERTAIN ADMINISTRATIVE PROVISIONS
SECTION 5.1 Form of Participant Schedule. The Trustee may, from
time to time, request the Committee to prepare and deliver to the Trustee
in accordance with Subsection 5.2 hereof, a schedule (the "Participant
Schedule") that sets forth the name of each Participant or such group of
Participants and all such other information that the Trustee may need to
know in order to carry out the provisions of this Trust Agreement.
SECTION 5.2 Maintaining the Participant Schedule. At the
request of the Trustee, the Committee shall from time to time update the
Participant Schedule. Each Participant Schedule shall state the date as of
which it applies, and the Trustee shall be entitled to rely upon such
Participant Schedule, without a duty of further inquiry, until it receives
an updated Participant Schedule bearing a later date. Each Participant
Schedule shall contain all information concerning a Participant and all
such other information which the Trustee will need to complete its
responsibilities under this Trust Agreement.
ARTICLE VI
TERMINATION AND AMENDMENT
SECTION 6.1 Termination. The Trust shall be terminated on the
earlier of the fifteenth anniversary of the date hereof or the date on
which any of the following events occurs (the "Termination Date"): (a) the
Company's contractual obligations under the Plans are satisfied in full;
(b) the Trust Corpus is exhausted; (c) the Department of Labor or a court
of competent jurisdiction has determined that the assets of the Trust are
subject to Part 4 of Subtitle B of Title I of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"); (d) the Internal Revenue
Service or a court of competent jurisdiction has determined that any
portion of the Trust Corpus is presently taxable to any Participant or
Beneficiary; or (e) the date of occurrence of a Change in Control (as
defined in Section 6.2(c) hereof). Upon termination of the Trust, any
remaining portion of the Trust Corpus shall be applied as expeditiously as
possible as follows: first, to satisfy any outstanding principal and
interest on the Note (and the Trustee shall dispose of a sufficient number
of shares of Common Stock (or, if applicable, property received in exchange
for Common Stock in connection with a Change in Control), either on the
open market or in privately negotiated transactions with one or more third
parties (other than the Company), so that, when added to any cash and Cash
Equivalents then held in the Trust, will enable the Trustee to satisfy such
principal and interest); second, the remaining shares of Common Stock and
other assets constituting the Trust Corpus shall be transferred to the
Administrator or Director to be distributed in the form of Common Stock or
cash (as provided pursuant to the terms of a particular Plan) to
Participants as provided in, and in the order set forth in, Section 3.2(b)
hereof; and thereafter, any remaining shares of Common Stock or other
assets constituting the Trust Corpus shall be transferred to the Director
to be used (as determined by the Committee, taking into account the best
interests of a broad cross- section of employees of the Company) solely to
fund or provide benefits to employees of the Company under
separately-established, bona fide Company compensation or benefit plans and
for contractual or other compensation or benefit obligations of the Company
(other than Plans), it being understood that this Trust creates no rights
to the Trust Corpus separate and apart from rights derived from an
underlying, independent compensation or benefit plan or contractual or
other compensation or benefit obligation of the Company. For purposes of
the Committee's determinations as to the application of the Trust Corpus
upon termination of the Trust, only compensation or benefit obligations
that arise legitimately in the ordinary course of business of the Company
shall be deemed "bona fide". In no event shall the Company receive any
distribution of the Trust Corpus upon termination of the Trust, except in
repayment of unpaid principal and interest due under the Note.
SECTION 6.2 Amendment. (a) The Company may amend this Trust
Agreement, by written instrument executed and duly authorized by the
Company; provided however, that a revision to Exhibit A hereto which adds
Plans thereto or deletes Plans therefrom, may be made only if (1) at least
one Plan does not constitute an employee benefit plan (within the meaning
of ERISA) and (2) in making any such revision the Company acts in good
faith, taking into account the best interests of a broad cross-section of
employees of the Company; and provided, further, however, that no such
amendment shall accelerate the Termination Date, materially alter the
provisions of Sections 2.2, 3.1, 3.2, 4.3, 4.4 or 6.1 hereof or this
Section 6.2 or permit the Company to receive any distribution of the Trust
Corpus except in repayment of unpaid principal and interest due under the
Note or any subsequent indebtedness incurred by the Trustee; and provided,
further, however, that no amendment to this Trust Agreement pursuant to
this Section 6.2(a) or Section 6.2(b) hereof shall modify the
responsibilities or duties of the Trustee without its written consent.
(b) Notwithstanding Section 6.2(a) hereof, (1) the
Company may amend this Trust Agreement from time to time in such a manner
as may be necessary, in the opinion of independent counsel, to prevent this
Trust Agreement or the Trust from becoming subject to ERISA or to prevent
the current taxation of the Trust Fund to any Participant or Beneficiary;
(2) the Company may amend this Trust Agreement to authorize the Trustee to
undertake future borrowings to acquire additional shares of Common Stock;
provided, however, that such borrowings are on terms and are subject to
limitations and restrictions consistent in all material respects with those
applicable to the borrowing evidenced by the Note; (3) the Company may
amend the provisions of Section 4.4 to include as Eligible Participants
those participants in one or more tax-qualified defined contribution plans
maintained by the Company and to have the shares of Common Stock allocated
to the accounts of such participants in such plans taken into account for
purposes of applying the provisions of said Section 4.4; and (4) this Trust
Agreement may be amended in any respect (other than to permit the Company
to receive any distribution of the Trust Corpus except in repayment of
unpaid principal and interest due under the Note or any subsequent
indebtedness incurred by the Trustee), so long as such amendment has been
approved by the affirmative vote of Eligible Participants (as defined in
this Trust Agreement as in effect prior to March 17, 2000) who, as of a
date not earlier than thirty (30) days prior to the date of such amendment,
have the right to direct the Trustee with respect to more than fifty
percent (50%) of the aggregate number of Directed Shares (as defined in
this Trust Agreement as in effect prior to March 17, 2000).
(c) For purposes of this Trust Agreement, a "Change in
Control" shall be deemed to have occurred if the event set forth in any one
of the following paragraphs shall have occurred:
(i) any Person is or becomes the beneficial owner,
as defined in Rule 13d-3 under the Exchange Act (the "Beneficial
Owner"), directly or indirectly, of securities of the Company (not
including in the securities beneficially owned by such Person any
securities acquired directly from the Company or its affiliates)
representing 25% or more of either the then outstanding shares of
Common Stock or the combined voting power of the Company's then
outstanding voting securities; or
(ii) the following individuals cease for any reason
to constitute a majority of the number of directors then serving:
individuals who, on the date hereof, constitute the Board and any new
director (other than a director whose initial assumption of office is
in connection with an actual or threatened election contest,
including but not limited to a consent solicitation, relating to the
election of directors of the Company, as such terms are used in Rule
14a-11 of Regulation 14A under the Exchange Act) whose appointment or
election by the Board or nomination for election by the Company's
shareholders was approved by a vote of at least two-thirds (2/3) of
the directors then still in office who either were directors on the
date hereof or whose appointment, election or nomination for election
was previously so approved; or
(iii) the shareholders of the Company approve a
merger or consolidation of the Company with any other corporation or
approve the issuance of voting securities of the Company in
connection with a merger or consolidation of the Company (or any
direct or indirect subsidiary of the Company) pursuant to applicable
stock exchange requirements, other than (1) a merger or consolidation
which would result in the voting securities of the Company
outstanding immediately prior to such merger or consolidation
continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity or any
parent thereof) at least 60% of the combined voting power of the
voting securities of the Company or such surviving entity or any
parent hereof outstanding immediately after such merger or
consolidation, or (2) a merger or consolidation effected to implement
a recapitalization of the Company (or similar transaction) in which no
Person is or become the Beneficial Owner, directly or indirectly, of
securities of the Company (not including in the securities
beneficially owned by such Person any securities acquired directly
from the Company or its affiliates) representing 25% or more of either
the then outstanding shares of Common Stock or the combined voting
power of the Company's then outstanding voting securities; or
(iv) the shareholders of the Company approve a plan
of complete liquidation or dissolution of the Company or an agreement
for the sale or disposition by the Company of all or substantially
all of the Company's assets (in one transaction or a series of
related transactions within any period of 24 consecutive months),
other than a sale or disposition by the Company of all or
substantially all of the Company's assets to an entity, at least 75%
of the combined voting power of the voting securities of which are
owned by Persons in substantially the same proportions as their
ownership of the Company immediately prior to such sale.
Notwithstanding the foregoing, no "Change in Control" shall be
deemed to have occurred if there is consummated any transaction or series
of integrated transactions immediately following which the record holders
of Common Stock immediately prior to such transaction or series of
transactions continue to have substantially the same proportionate
ownership in an entity which owns all or substantially all of the assets of
the Company immediately following such transaction or series of
transactions.
The Committee shall notify the Trustee promptly in writing upon
any Change in Control; the Trustee may conclusively rely upon such notice,
and the Trustee shall have no responsibility for independently determining
whether any such event has occurred.
(d) For purposes of Section 6.2(c) hereof, the term
"Person" shall have the meaning given in Section 3(a)(9) of the Exchange
Act, as modified and used in Sections 13(d) and 14(d) thereof, except that
such term shall not include (i) the Company or any of its subsidiaries,
(ii) a trustee or other fiduciary holding securities under an employee
benefit plan of the Company or any of its subsidiaries, (ii) an underwriter
temporarily holding securities pursuant to an offering of such securities,
(iv) a corporation owned, directly or indirectly, by the shareholders of
the Company in substantially the same proportions as their ownership of
stock of the Company, or (v) the Trustee, in its capacity as Trustee of the
Trust created hereby.
ARTICLE VII
GENERAL PROVISIONS
SECTION 7.1 Certain Provisions Relating to This Trust
Agreement. (a) This Trust Agreement shall be binding upon and inure to the
benefit of the parties and their respective successors and legal
representatives.
(b) This Trust Agreement shall be governed by and
construed in accordance with the laws of Delaware, without reference to any
provisions of such laws regarding choice of laws or conflict of laws.
(c) In the event that any provision of this Trust
Agreement or the application thereof to any person or circumstances shall
be determined by a court of proper jurisdiction to be invalid or
unenforceable to any extent, the remainder of this Trust Agreement, or the
application of such provision to persons or circumstances other than those
as to which it is held invalid or unenforceable, shall not be affected
thereby, and each other provision of this Trust Agreement shall be valid
and enforced to the fullest extent permitted by law.
SECTION 7.2 Notices. Any notice, report, demand or waiver
required or permitted hereunder shall be in writing and shall be given
personally, delivered by overnight delivery service or sent by telecopier,
addressed as follows:
If to the Company:
Snap-On Incorporated
P.O. Box 1410
Kenosha, Wisconsin 53141-1410
Attention: General Counsel
If to the Trustee:
The Northern Trust Company
50 S. LaSalle Street
Chicago, Illinois 60675
Attention: Mr. John Malusa
Notices shall be effective only upon receipt.
The Company or Trustee may change the address to which notices,
requests and other communications are to be sent to it by giving written
notice of such address change to the other parties in conformity with this
Section 7.2.
SECTION 7.3 Gender and Number. Wherever any words are used
herein in the masculine gender, they shall be construed as though they were
also used in the feminine gender in all cases where they would so apply,
and wherever any words are used herein in the singular form, they shall be
construed as though they were also used in the plural form in all cases
where they would so apply. Likewise, wherever any words are used herein in
the plural form, they shall be construed as though they were also used in
the singular form in all cases where they would so apply.
SECTION 7.4 Headings. The headings and subheadings of this
Agreement have been inserted for convenience of reference and are to be
ignored in any construction of the provisions hereof.
SECTION 7.5 No Third Party Beneficiaries. Nothing in this
Trust, express or implied, is intended to or shall confer on any particular
person, other than the Company and the Trustee, any right, benefit or
remedy of any nature whatsoever under or by reason of this Trust, and no
such person shall have any right, title or interest in or any claim to the
Trust Corpus except as expressly provided herein. In particular, it is the
express intent of the parties that (i) this Trust shall not form part of
any of the Plans, (ii) neither any Plan nor any Participant in any of the
Plans (nor any Beneficiary of such Participant) shall have any right, title
or beneficial ownership or other interest in or any claim (preferred or
otherwise) to the Trust Corpus, nor, except as otherwise expressly provided
herein, shall any such participant have any right to compel, restrain or
otherwise direct the exercise of the respective powers of Trustee and the
Company hereunder, it being understood that the rights of each such
Participant (and Beneficiary) shall be determined in accordance with the
provisions of the Plans and (iii) except as otherwise expressly provided
herein, the Trust Corpus shall not be deemed to be held under any trust for
the benefit of any such Participant (or Beneficiary) or to be collateral
security for the performance of the obligations of the Company.
SECTION 7.6 Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original,
but all of which together constitute but one instrument, which may be
sufficiently evidenced by any counterpart.
SECTION 7.7 Successors. Effective upon consolidation of the
Company with, or merger of the Company with or into, any corporation or
corporations or other entity or entities, or any sale or conveyance of all
or substantially all of the assets of the Company, the Trustee shall deal
with the corporation formed by such consolidation, or with or into which
the Company is merged, or the person that acquires the assets of the
Company, on the same basis as it dealt with the Company prior to such
transactions and, in such event, the term "Company" within this Agreement
shall mean such corporation or person.
SECTION 7.8 Grantor Trust. The Trust shall be treated as a
grantor trust of the Company under the Code, and the Company shall take
into account in computing its tax liability, those items of income,
deductions and credits against tax attributable to assets held in the Trust
to which the Company would have been entitled had the Trust not been in
existence. The Trustee shall notify the Company promptly after it becomes
aware of any tax liability assessed against, or imposed upon, the Trust or
the Trustee in its capacity as Trustee of the Trust. The Company shall be
responsible for all matters in respect of such assessment or imposition,
and shall have sole responsibility for any defense in connection therewith.
Payments in respect of any tax liability of the Company arising in
connection with earnings, gains or activities relating to the Trust,
including, without limitation interest and penalties, shall be made by the
Company. The Company shall also be responsible for directing the Trustee
with respect to any tax withholding and filing applicable to any
distributions from the Trust.
IN WITNESS WHEREOF, the parties have caused this Agreement, to
be executed in their respective names by their duly authorized officers on
the day and year first above written.
SNAP-ON INCORPORATED
By: /s/ Susan F. Marrinan
-----------------------------------
Name: Susan F. Marrinan
Title: Vice President, Secretary
and General Counsel
THE NORTHERN TRUST COMPANY,
solely in its capacity as
trustee under this Trust
Agreement
By: /s/ M. Curtis Pence
------------------------------------
Name: M. Curtis Pence
Title: Vice President
EXHIBIT A
PLANS/ADMINISTRATOR
- -------------------------------------------------------------------------------
Plan Administrator
---- -------------
- -------------------------------------------------------------------------------
Snap-on Incorporated 401(k) Personal Savings The Company
Plan
- -------------------------------------------------------------------------------
Snap-on Incorporated 401(k) Personal The Company
Plan for Collective Bargained Employees
- -------------------------------------------------------------------------------
Snap-on Tools Company 401(k) Matching Plan The Company
- -------------------------------------------------------------------------------
Snap-on Incorporated 401(k) Savings Plan The Company
for Subsidiaries
- -------------------------------------------------------------------------------
Snap-on Incorporated Employee Stock Ownership President of the Company
Plan
- -------------------------------------------------------------------------------
Snap-on Incorporated Franchised Dealer Stock President of the Company
Ownership Plan
- -------------------------------------------------------------------------------
Snap-on Incorporated Deferred Compensation A Committee consisting of
Plan the Organization &
Executive Compensation
Committee
- -------------------------------------------------------------------------------
Amended and Restated Snap-on Incorporated A Committee of the Board
1986 Incentive Stock Option Plan of Directors (the
President and the
Chairman of the O&E
Committee)
- -------------------------------------------------------------------------------
Snap-on Incorporated Supplemental Retirement The Company
Plan for Officers
- -------------------------------------------------------------------------------
Snap-on Incorporated Retirement Plan The Company
Administrative and Field Employees
- -------------------------------------------------------------------------------
Snap-on Incorporated Retirement Plan The Company
Employees
- -------------------------------------------------------------------------------
Snap-on Incorporated Comprehensive Health The Company
Benefits Program for Retirement
Employees (Plan 546)
- -------------------------------------------------------------------------------
Snap-on Incorporated Comprehensive Health The Company
Benefits Program for Active Employees
(Plan 545)
- -------------------------------------------------------------------------------
All compensation, bonus and other pay-related The Company
programs sponsored by Snap-on Incorporated and/or
its Subsidiaries for employees generally
- -------------------------------------------------------------------------------
All other Health and Welfare1 and Retirement2 The Company
Benefit Plans sponsored by Snap-on Incorporated
and/or its Subsidiaries for employees generally
- -------------------------------------------------------------------------------
IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed in their respective names by their duly authorized officers on
the day and year first above written.
SNAP-ON INCORPORATED
By: /s/ Susan F. Marrinan
-------------------------------------------
Name: Susan F. Marrinan
Title: Vice President, Secretary
and General Counsel
THE NORTHERN TRUST COMPANY,
solely in its capacity as trustee under this
Trust Agreement
By: /s/ M. Curtis Pence
-------------------------------------------
Name: M. Curtis Pence
Title: Vice President
- --------
1 As used herein, these terms have the meaning ascribed to them under
ERISA.
