EXHIBIT 10.19
ALLIANT ENERGY RABBI TRUST
AGREEMENT
This Agreement is made and entered
into as of December __, 2005, by and between Alliant Energy
Corporate Services, Inc., an Iowa corporation (the
“Sponsor”), and Wells Fargo Bank, N.A., a national
banking association, as trustee (the
“Trustee”);
W I T N E S S E T
H:
WHEREAS , the Sponsor, Alliant Energy Corporation
(“AEC”), Interstate Power and Light Company
(“IES”) and Wisconsin Power and Light Company
(“WPL”) have adopted or entered into various
nonqualified deferred compensation plans and agreements and have
incurred or expect to incur liability under the terms of such plans
with respect to the individuals participating in such plans;
and
WHEREAS , on December 1, 2000, the Sponsor, IES and WPL
authorized the Sponsor to, and it did, merge various trusts into a
trust agreement with Marshall & Ilsley Trust Company (the
“Existing Trust”); and
WHEREAS , on December 1, 2000, AEC established a trust
pursuant to a trust agreement with Marshall & Ilsley Trust
Company (the “AEC Trust”) to fund the Alliant Energy
Corporation Deferred Compensation Plan for Directors (the
“Directors’ Plan”); and
WHEREAS , the Sponsor wishes to continue a trust
arrangement and to contribute to such trust assets that shall be
held therein, subject to the claims of creditors in the event of
Insolvency, as herein defined, until paid to plan participants and
their beneficiaries in such manner and at such times as specified
in the plans; and
WHEREAS , the Sponsor and AEC wish to merge the AEC
Trust into the Existing Trust; and
WHEREAS , the Sponsor enters into this Agreement for the
purpose of restating the Existing Trust and the AEC Trust, merging
the AEC Trust into the Existing Trust, and designating the Trustee
as the successor trustee thereunder (the ongoing trust hereinafter
the “Trust”); and
WHEREAS , the Trust shall be for the benefit of the
participants and beneficiaries of the nonqualified deferred
compensation plans and agreements listed in Appendix A of this
Agreement (referred to herein as the “Plans,” or, in
reference to each, as a “Plan”); and
WHEREAS, the plan sponsor of each Plan as indicated in
Appendix A shall have responsibilities with respect to such Plan
hereunder (the sponsor of each Plan being the “Company”
with respect to such Plan); and
WHEREAS , it is the intention of the parties that this
Trust shall constitute an unfunded arrangement and shall not affect
the status of the Plans as unfunded plans maintained for the
purpose of providing deferred compensation for a select group of
management or highly compensated employees for purposes of Title I
of the Employee Retirement Income Security Act of 1974
(“ERISA”) with respect to those Plans subject to ERISA;
and
WHEREAS , it is the intention of each 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 Plans;
and
WHEREAS , while the assets of the Trust Fund are not
“Plan assets” under ERISA, the intention of the parties
is to manage the Trust Fund in certain respects in a manner
consistent with the operation of certain other trust arrangements
between the parties which are subject to ERISA;
NOW, THEREFORE
, the Sponsor and the Trustee do
hereby establish the Trust and the parties agree that the Trust
Fund shall be comprised, held and disposed of as
follows:
SECTION 1
ESTABLISHMENT OF
TRUST
1.1
Effective January 1, 2006, the Trust
is continued, and the assets of the Existing Trust shall be
transferred to the Trustee on January 3, 2006, except for those
assets related to the Alliant Energy Key Employee Deferred
Compensation Plan and the Directors’ Plan which shall be
transferred on March 1, 2006. The Trustee shall maintain separate
accounts within the Trust to record the assets thereof attributable
to the Plans of each of the corporate sponsors as indicated in
Appendix A (the “Plan Accounts”).
1.2
The Trust shall be
irrevocable.
1.3 The
Trust is intended to be a grantor trust, of which each Company is
the grantor with respect to its Plan Account, within the meaning of
subpart E, part I, subchapter J, chapter 1, subtitle A of the
Internal Revenue Code of 1986, as amended (the “Code”),
and shall be construed accordingly.
1.4 The
principal of the Trust Fund, and any earnings thereon, shall be
held separate and apart from other funds of the 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 Fund. Any
rights created under the Plans and this Agreement shall be mere
unsecured contractual rights of Plan participants and their
beneficiaries against the Company. Any assets held by the Trust
will be subject to the claims of general creditors under federal
and state law in the event of Insolvency, as defined in Section 3.1
herein.
1.5 Within
60 days following a Change in Control, each Company shall make an
irrevocable contribution to the applicable Plan Account within the
Trust so that the Trust assets for that Plan Account are at least
the sum of the participants’ and beneficiaries’ accrued
benefits
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pursuant to the terms of the Plans.
For Plans with benefit formulas which are defined contribution
formulas, the amount of the accrued benefits shall be the account
balances as of the date of the Change in Control. For Plans with
cash balance formulas, the amount of the accrued benefits for
participants who are not in pay status shall be 120% of the lump
sum amount that would have been distributable as of the last day of
the plan year coincidental with or immediately preceding the date
of the Change in Control. For Plans with defined benefit formulas
other than cash balance and for those participants in pay status
under a cash balance plan with a grandfathered annuity benefit, the
amount of the accrued benefits shall be 120% of the Accumulated
Benefit Obligation as of the measurement date for the corporate
fiscal year ending coincidental with or immediately preceding the
date of the Change in Control, based on actuarial assumptions most
recently applied in calculating the Company’s liability under
Financial Accounting Standard 87. Notwithstanding the foregoing,
with respect to the Directors’ Plan, such contribution shall
be made within ten business days following a Change in
Control.
1.6 As
of each December 31 following a Change in Control,
(“Valuation Date”), each Company shall determine the
amount of the contribution which would have been required pursuant
to Section 1.5 if the Change in Control had occurred on such
Valuation Date and make an irrevocable contribution of such amount,
if any, within 60 days following such December 31. Notwithstanding
the foregoing, with respect to the Directors’ Plan, such
contribution shall be made within ten business days following such
December 31.
1.7 Within
60 days following a Potential Change in Control, each Company shall
make a contribution to the applicable Plan Account within the Trust
in the amount that would have been required to be contributed
pursuant to Section 1.5 if the Potential Change in Control had been
a Change in Control. In the event that a Change in Control shall
not have occurred within the time specified in the following
sentence, at the written direction of the Sponsor, the contribution
to the Trust as a result of the preceding sentence, plus investment
gains thereon or minus investment losses thereon, shall be released
and delivered to the Company. The specified time for the preceding
sentence is twelve (12) months after the occurrence of a Potential
Change in Control unless proceedings are then pending to obtain
necessary regulatory approvals to permit a Change in Control, in
which case the specified time is three (3) months after such
proceedings have concluded. Notwithstanding the foregoing, with
respect to the Directors’ Plan, such contribution shall be
made within ten business days following such Potential Change in
Control.
1.8 Each
Company, in its sole discretion, may at any time, or from time to
time, make additional deposits of cash or other property in trust
with the Trustee for its Plan Account to augment the principal to
be held, administered and disposed of by the Trustee as provided in
this Agreement. The Plan participants and their beneficiaries shall
have no right to compel any such discretionary deposits. Any such
decision concerning a Plan or accounts for non-employee directors
of a Company shall be separate and distinct from any such decision
concerning a Plan or account for employees.
1.9 The
Trustee shall have no obligation to compel any deposits that are
required pursuant to this Agreement.
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SECTION 2
PAYMENTS TO PLAN PARTICIPANTS
AND THEIR BENEFICIARIES
2.1 On
behalf of the Company, the Sponsor shall deliver to the Trustee a
schedule (the “Payment Schedule”) that indicates the
amounts payable in respect of each Plan participant (and his or her
beneficiaries), or that provides a formula or other instructions
acceptable to the Trustee for determining the amounts so payable,
the form in which such amounts are to be paid (as provided for or
available under the Plans), and the time of commencement for
payment of such amounts. Except as otherwise provided herein, the
Trustee shall make payments to the Plan participants and their
beneficiaries in accordance with the most recent Payment Schedule
received by the Trustee. Based exclusively upon direction from the
Sponsor as to time and amounts, the Trustee shall make provision
for the reporting and withholding of any federal and state taxes
(other than FICA and FUTA taxes) that may be required to be
withheld with respect to the payment of benefits pursuant to the
terms of the Plans and, based exclusively upon direction from the
Sponsor, shall pay amounts withheld to taxing authorities. If
applicable, the Sponsor shall direct the Trustee to remit to the
Sponsor or the Company any FICA, FUTA and local taxes with respect
to benefit payments and the Sponsor or the Company, as applicable,
shall have the responsibility for determining, reporting and paying
the FICA, FUTA and local taxes to the appropriate taxing
authorities. The Trustee acts solely as the Company’s agent
for purposes of reporting and withholding on payments from the
Trust, and the Company shall be solely responsible for determining
that such amounts have been reported, withheld and paid to
appropriate taxing authorities in a timely manner.
2.2 The
entitlement of a Plan participant or his or her beneficiaries to
benefits under the Plans shall be determined by the Company or such
party as it shall designate under the Plans, and any claim for such
benefits shall be considered and reviewed under the procedures set
out in the Plans.
2.3 The
Company may make payment of benefits directly to Plan participants
or their beneficiaries as they become due under the terms of the
Plans. Through the Sponsor, the Company shall notify the Trustee 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 Fund, and any earnings
thereon, are not sufficient to make payments of benefits in
accordance with the terms of the Plans, the Company shall make the
balance of each such payment as it falls due. The Trustee shall
notify the Company through the Sponsor where principal and earnings
are not sufficient.
SECTION 3
TRUSTEE RESPONSIBILITY REGARDING
PAYMENTS
TO TRUST BENEFICIARY WHEN
COMPANY IS INSOLVENT
3.1 The
Trustee shall cease payment of benefits to Plan participants and
their beneficiaries if the Company is Insolvent. The Company shall
be considered “Insolvent” for purposes of this
Agreement if it is unable to pay its debts as they become due, or
if it is subject to a pending proceeding as a debtor under the
United States Bankruptcy Code.
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3.2 At
all times during the continuance of this Trust, as provided in
Section 1.4 hereof, the principal and income of the Trust Fund
shall be subject to claims of general creditors of the Company
under federal and state law as set forth below.
3.3 The
Board of Directors and the Chief Executive Officer of the Sponsor
shall have the duty to inform the Trustee in writing of the
Company’s Insolvency. If a person claiming to be a creditor
of the Company alleges in writing to the Trustee that the Company
has become Insolvent, the Trustee shall determine whether the
Company is Insolvent and, pending such determination, the Trustee
shall discontinue payment of benefits to the participants or their
beneficiaries of the Plan or Plans of which such Company is the
sponsor.
3.4 Unless
the Trustee has actual knowledge of the Company’s Insolvency,
or has received notice from the Sponsor or a person claiming to be
a creditor alleging that the Company is Insolvent, the Trustee
shall have no duty to inquire whether the Company is Insolvent. The
Trustee may in all events rely on such evidence concerning the
Company’s solvency as may be furnished to the Trustee and
that provides the Trustee with a reasonable basis for making a
determination concerning the Company’s solvency.
(a) If
at any time the Trustee has determined that the Company is
Insolvent, the Trustee shall discontinue payments to participants
or their beneficiaries of the Plan or Plans of which such Company
is the sponsor and shall hold the assets of such Plan Accounts
within the Trust Fund for the benefit of the Company’s
general creditors. Nothing in this Agreement shall in any way
diminish any rights of Plan participants or their beneficiaries to
pursue their rights as general creditors of the Company with
respect to benefits due under the Plans or otherwise.
(b) The
Trustee shall resume the payment of benefits to Plan participants
or their beneficiaries in accordance with Section 2 of this
Agreement only after the Trustee has determined that the Company is
not Insolvent (or is no longer Insolvent).
3.5 Provided
that there are sufficient assets, if the Trustee discontinues the
payment of benefits from the Trust pursuant to Section 3.2 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 Plans for the period of such discontinuance, less the
aggregate amount of any payments made to Plan participants or their
beneficiaries by the Company in lieu of the payments provided for
hereunder during any such period of discontinuance.
3.6 Notwithstanding
any provisions herein to the contrary, any Company Stock (as
defined in Section 5.7) or other assets contributed by a Company to
a Plan Account for the benefit of the employees of affiliates shall
be subject to the Insolvency provisions of Section 3 with respect
to the Company which is the sponsor of the applicable Plan and,
upon the termination of the Trust after payment of all benefits to
participants and beneficiaries, shall revert to the contributing
Company.
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SECTION 4
PAYMENTS TO
COMPANY
Except as provided in Sections 1.7,
2.1 and 3 hereof, the Sponsor shall have no right or power to
direct the Trustee to return to the 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 Plans.
SECTION 5
INVESTMENT
AUTHORITY
5.1 Subject
to Section 5.6, except to the extent that an Investment Manager or
Named Fiduciary is otherwise appointed in accordance with Sections
5.3, 5.4 or 5.5, the Sponsor shall act as a Named Fiduciary in
accordance with Section 5.5 with respect to the entire Trust Fund,
and the Trustee shall be subject to the directions of the Sponsor
as provided in such Section 5.5. Subject to Section 5.6, except to
the extent that the Trustee is itself appointed as an Investment
Manager pursuant to Section 5.4, it shall always be a directed
trustee and follow in good faith the investment directions of the
Sponsor, an Investment Manager, or a Named Fiduciary, as
applicable. In such regard, the Trustee shall invest and reinvest
the principal and income of the Trust Fund with the care, skill,
prudence, and diligence under the circumstances then prevailing
that a prudent man acting in a like capacity and familiar with such
matters would use in the conduct of an enterprise of a like
character and with like aims. Without limiting the generality of
the foregoing, the investments and reinvestments of the Trust Fund
shall be subject to the following:
(a) Investments
shall be as consistent as reasonably possible with any funding
policy communicated to the Trustee in writing by the Sponsor
pursuant to the Plans. The Trustee may rely on the latest such
communication received by it without further inquiry or
verification.
(b) The
Trustee may invest and reinvest principal and income of the Trust
Fund in common, preferred, and other stocks of any corporation;
voting trust certificates; interests in investment trusts,
including, without limiting the generality thereof, participations
issued by an investment company as defined in the Investment
Company Act of 1940, as from time to time amended; bonds, notes,
and debentures, secured or unsecured; mortgages on real or personal
property; conditional sales contracts; real estate and leases; and
limited partnerships.
(c) To
the extent permitted by the Code and other applicable laws, the
Trustee may commingle for investment all or any part of the funds
of the Trust Fund with funds of other grantor trusts established by
the Sponsor or any entity directly or indirectly controlling,
controlled by, or under common control with the Sponsor; provided
that records are at all times maintained of the portion of the
commingled funds properly allocable to each trust.
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(d) The
Trustee may invest and reinvest the principal and income of the
Trust Fund by investing in an annuity contract or contracts
(including any agreement or agreements supplemental thereto) issued
by an insurance company.
(e) The
Trustee may engage in the writing, sale, and buying in, of covered
call option contracts; and the Trustee may acquire and may exercise
options to purchase or sell securities or other assets.
(f) The
Trustee may invest and reinvest the principal and income of the
Trust Fund in stock, securities, or real property of the Sponsor or
any entity directly or indirectly controlling, controlled by, or
under common control with the Sponsor.
(g) The
Trustee may invest and reinvest principal and income of the Trust
Fund in deposits (including savings accounts, savings certificates,
and similar interest-bearing instruments or accounts) in itself or
its affiliates, provided such deposits bear a reasonable rate of
interest.
(h) The
Trustee may purchase or sell financial futures contracts in
transactions executed through a generally recognized commodities or
securities exchange.
(i) The
Trustee may lend any securities or security from time to time
constituting a part of the Trust Fund in exchange for such
consideration and upon such terms and conditions as the Trustee
deems appropriate. In any such transaction the Trustee may transfer
legal title to the securities being loaned to the obligor, and may
permit the obligor to return to the Trust Fund securities that are
identical (but not necessarily evidenced by the same certificates)
to those transferred to it by the Trustee hereunder.
5.2 If
a Plan provides for the purchase of a life insurance policy or
annuity contract on the life of a participant, the Trustee shall
make such purchases on written direction of the Sponsor. Each such
direction shall be complete with respect to the terms of the
purchase. The Sponsor shall give written direction as to any
subsequent action to be taken with respect to each such policy or
contract, it being intended that the Trustee shall have no
discretion with respect thereto.
5.3 Subject
to Section 5.6 hereof, the Sponsor may appoint one or more
insurance companies that meet the requirements of Section 3(38) of
ERISA to serve as an Investment Manager. The appointment of any
such Investment Manager and investment of the Trust Fund pursuant
to such appointment shall be subject to the following,
notwithstanding any provisions of this Agreement to the
contrary:
(a) Written
notice of each such appointment shall be given to the Trustee a
reasonable time in advance of the effective date of the
appointment.
(b) The
Sponsor shall determine the terms of each contract to be entered
into between such insurance company and the Trustee (including any
agreement or agreements supplemental thereto) pursuant to which
investment management services shall be performed by the insurance
company. On written direction of the Sponsor the
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Trustee shall make application for
each such contract and shall hold the contract as an asset of the
Trust Fund.
(c) The
Trustee shall pay such premiums to the insurance company pursuant
to such contract as may be directed in writing by the Sponsor;
provided, however, that no such payment shall be made until the
Trustee has been furnished with an acknowledgement in writing by
the insurance company that it is a fiduciary with respect to one or
more Plans and this Trust.
(d) Except
as otherwise agreed in writing by the Trustee and the Sponsor, the
Trustee shall take only such actions as contractholder of such
contract as may be directed in writing by the Sponsor.
(e) Any
direction by the Sponsor with respect to such contract shall be
complete as to the terms with respect thereto, it being intended
that the Trustee shall have no discretion whatsoever with respect
to the provisions of such contract or actions taken pursuant
thereto.
(f) The
insurance company serving as an Investment Manager shall determine
in good faith the fair market value of assets held in such
contracts no less often than annually, assuming an orderly
liquidation at the time of such determination if the market value
is not readily available.
5.4 Subject
to Section 5.6 hereof, the Sponsor may appoint one or more parties
that are registered as investment advisers under the Investment
Advisers Act of 1940 to serve as an Investment Manager as defined
in Section 3(38) of ERISA. The appointment of any such Investment
Manager and investment of the Trust Fund pursuant to such
appointment shall be subject to the following, notwithstanding any
provisions hereof to the contrary:
(a) Written
notice of each such appointment shall be given to the Trustee a
reasonable time in advance of the effective date of the
appointment. The notice shall state what portion of the Trust Fund
is to be invested by the Investment Manager and shall direct the
Trustee to segregate such portion of the Trust Fund into a separate
account for the Investment Manager. Each such separate account is
referred to in this section as an Investment Account. The Trustee
shall be provided a copy of the Sponsor’s written agreement
with the Investment Manager.
(b) The
Trustee shall not act on any direction or instruction of the
Investment Manager until the Trustee has been furnished with an
acknowledgement in writing by the Investment Manager that it is a
fiduciary with respect to one or more Plans and this
Trust.
(c) Payment
of the cost of the acquisition, sale, or exchange of any security
or other property for an Investment Account shall be charged to
that Investment Account unless the agreement between the Sponsor
and Investment Manager provides otherwise.
(d) So
long as the appointment of an Investment Manager is in effect, the
Investment Manager shall have full power and authority to direct
the Trustee as to, and full responsibility for, investment of its
Investment Account and for the retention and
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disposition of any assets in its
Investment Account. Subject to any limitations in the agreement
between the Company and the Investment Manager, the Investment
Manager shall have exclusive authority and discretion to invest and
reinvest the principal and interest of the Trust Fund, subject to
the provisions of Section 5.1.
(e) Unless
the written agreement between the Sponsor and Investment Manager
expressly provides that the Sponsor shall have the voting power
with respect to all stocks and other securities in the Investment
Account, the Investment Manager shall have voting power with
respect to all such stocks and other securities.
(f) The
Trustee shall make available to an Investment Manager copies of or
extracts from such portions of its accounts, books, or records
relating to the Investment Account of such Investment Manager as
the Trustee may deem necessary or appropriate in connection with
the exercise of the Investment Manager’s function, or as the
Sponsor may direct.
(g) All
charges (other than those covered in subsection (d) above) against
each Investment Account shall be made in such proportions as the
Sponsor may direct from time to time.
(h) If
the authority of an Investment Manager is terminated, unless and
until a successor Investment Manager is appointed with respect to
such Investment Account or the Investment Account is merged into a
different Investment Account, a Named Fiduciary Account, or an
insurance company contract, the Sponsor shall be responsible to
direct the Trustee as to the investment, management and disposition
of the assets held in such Investment Account. Until receipt of
written notice of the termination of the authority of an investment
manager, the Trustee shall be fully protected in assuming the
continuing authority of such Investment Manager.
(i) Any
direction by an Investment Manager shall be complete as to the
terms with respect thereto, it being intended that the Trustee
shall have no obligation whatsoever to invest or otherwise manage
any asset of an Investment Account.
(j) The
Investment Manager shall determine in good faith the fair market
value of assets held in an Investment Account no less often than
annually, assuming an orderly liquidation at the time of such
determination if the market value is not readily
available.
5.5 Subject
to Section 5.6 hereof, the Sponsor may designate one or more Named
Fiduciaries that shall have authority to direct the Trustee as to
the investment and reinvestment of all or a part of the Trust Fund.
The designation of any such Named Fiduciary and investment of the
Trust Fund pursuant to such designation shall be subject to the
following, notwithstanding any provisions hereof to the
contrary:
(a) Written
notice of each such appointment shall be given to the Trustee a
reasonable time in advance of the effective date of the
appointment. Such notice shall state what portion of the Trust Fund
is to be invested by the Named Fiduciary and shall direct the
Trustee to segregate such portion of the Trust Fund into a separate
account for
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such Named Fiduciary. Each such
separate account is referred to in this section as a Named
Fiduciary Account.
(b) The
Named Fiduciary shall be responsible for determining whether any
investment direction it gives to the Trustee is in accordance with
the terms of the documents and instruments governing the investment
of the Named Fiduciary Account.
(c) All
directions given by a Named Fiduciary to the Trustee shall be in
writing, signed by the duly authorized person or persons; provided
that the Trustee shall accept oral directions for the purchase or
sale of securities which shall be confirmed by such authorized
personnel in writing.
(d) In
all events the Trustee is to retain physical custody of or title to
all assets comprising a Named Fiduciary Account.
(e) &n
