Document:

exv4w17

 

Exhibit 4.17

FORM

 OF

FIFTH AMENDMENT

TO

THE SEARS 401(K) SAVINGS PLAN

TRUST AGREEMENT

(As Amended and Restated effective January 1, 1998)

     Pursuant to the authority reserved to the Company in Section 13.1 of the Sears 401(k) Savings
Plan Trust Agreement (the “Trust Agreement”), the Trust is hereby amended in the following
respects, effective as of January 1, 2005:

     1. The introductory language of Section 7.1 preceding paragraph (a) is hereby revised to
read as follows:

Notwithstanding any other provisions of the Trust, except for the provisions of
Section 7.5, below, and to the extent consistent with the Trustee’s fiduciary
obligations under ERISA, the Common Stock held in the Common Stock Fund shall be
voted by the Trustee as follows:

     2. New Section 7.5 is hereby added to the Trust to read as follows:

7.5 Merger with Kmart. In connection with the proposed merger of Sears,
Roebuck and Co. and KMART Holding Corporation under the Agreement and Plan of
Merger between Sears, Roebuck and Co. and KMART Holding Corporation dated November
16, 2004, and as may be amended (the “Merger Agreement”), the Investment Committee
pursuant to its authority at Section 5.2, shall appoint an “investment manager,” as
defined in Section 3(38) of ERISA (the “Merger Investment Manager”) to carry out
the responsibilities set forth in this Section with respect to the voting of the shares of Common Stock held under the Plan and the choice of merger consideration
with respect to such Common Stock under the terms of the Merger Agreement.

          (a) The Merger Investment Manager shall be responsible for directing the
Trustee with respect to the shareholder vote, on the Merger Agreement, of all
Common Stock held under the Plan as of the record date for such vote, provided that
the Merger Investment Manager shall to the extent not inconsistent with ERISA
direct the Trustee to vote the Common Stock held under the Plan in accordance with
the following provisions:

     (i) Before the meeting of the Company shareholders to vote on the
Merger Agreement (the “Merger shareholder meeting”), the Trustee or its
designee shall furnish each participant with a proxy statement for the
meeting, together with an appropriate form (“voting form”) on which the
participant may provide voting instructions for the Common Stock held
under the Plan and allocated to the participant’s account under the Plan
as of

 

 

the Valuation Date coinciding with or next preceding the record date
for such meeting for which the number of such shares has been provided to
the Trustee or its designee. The voting form and any instructions may be
in written or electronic form as the Trustee or its designee shall
determine. The voting form shall be sent to the Trustee or its designee
by the deadline specified by the Trustee or its designee in the voting
materials. Upon timely receipt by the Merger Investment Manager from the
Trustee or its designee of the results of such participant instructions,
the Merger Investment Manager shall instruct the Trustee to vote the shares of Common Stock for which voting forms are received in accordance
with such instructions. For this purpose, a participant’s return of a
signed, manual voting form, without indicating the manner in which the shares subject to the voting form shall be voted, shall be deemed a vote
in favor of the adoption of the Merger Agreement; a returned voting form
with a direction that the Trustee abstain from voting the participant’s shares shall be treated as an abstention with respect to such
participant’s shares, and will be treated as a vote against the Merger
Agreement for purposes of the provisions of paragraph (a)(ii) of this
Section 7.5. Shares for which no voting form is timely received shall be
voted in accordance with paragraph (a)(ii) of this Section 7.5.

     (ii) In the case of Common Stock held under the Plan as of the record
date for the Merger shareholder meeting with respect to which no voting
form is timely received, including Common Stock held under the suspense
account described in Supplement C to the Plan, the Merger Investment
Manager shall direct the Trustee to vote such shares in the same
proportion as the Trustee votes the shares of Common Stock for which
instructions are timely received, or are deemed received, pursuant to
paragraph (a)(i) of this Section 7.5.

          (b) The Merger Investment Manager shall be responsible for directing the
Trustee as to the election of merger consideration described in the joint proxy
statement/prospectus (issued in connection with the Merger Agreement) with respect
to shares of Common Stock held under the Plan as of the date of the Merger
shareholder meeting (defined above), provided that the Merger Investment Manager
shall to the extent not inconsistent with ERISA direct the Trustee as to the choice
of merger consideration in accordance with the following provisions:

     (i) Reasonably in advance of the Merger shareholder meeting, the
Trustee or its designee shall furnish each participant to whose account shares of Common Stock have been allocated as of the date such forms are
mailed with an appropriate form (“merger consideration election form”),
and shall make merger consideration election forms available to those
participants to

 

 

whose accounts shares of Common Stock are allocated after any such
mailing and prior to the deadline for returning such forms to the Trustee
or its designee. Merger consideration election forms and any instructions
may be in written or electronic form as the Trustee or its designee shall
determine. The merger consideration election form shall be sent to the
Trustee or its designee by the deadline specified by the Trustee or its
designee in the merger consideration election materials. The merger
consideration election form shall provide for participant direction as to
the election of merger consideration described in the joint proxy
statement/prospectus with respect to the shares of Common Stock allocated
to the participant’s account under the Plan as of the latest Valuation
Date coinciding with or next preceding the date of the Merger shareholder
meeting for which the number of shares has been provided to the Trustee or
its designee. Upon timely receipt by the Merger Investment Manager from
the Trustee or its designee of the results of such elections, the Merger
Investment Manager shall direct the Trustee to request the form of
consideration indicated by each participant who has timely returned a
properly completed merger consideration election form.

     (ii) In the case of shares of Common Stock held under the Plan as of
the date of the Merger shareholder meeting with respect to which no merger
consideration election form is timely received, including Common Stock
held under the suspense account described in Supplement C to the Plan, and shares of Common Stock with respect to which a merger consideration
election form is returned without direction as to the form of merger
consideration to be requested by the Trustee, the Merger Investment
Manager shall direct the Trustee to request merger consideration in the
same proportion of cash and stock as directed by the Merger Investment
Manager with respect to shares of Common Stock for which properly
completed merger consideration election forms are timely received, as
provided in accordance with paragraph (b)(i) of this Section 7.5.

          (c) Notwithstanding anything herein to the contrary, the form of merger
consideration received by the Plan with respect to the Common Stock held thereunder
is subject to such limitations as imposed generally under the terms of the Merger
Agreement, including, without limitation, the aggregate caps on the relative
amounts of stock and cash to be distributed in connection with the Merger, and in
the event that such a cap on total cash or stock received as merger consideration
is imposed on the Plan, the amount of consideration in such form that would
otherwise be allocated to a participant’s account (or to the suspense account
described in Supplement C to the Plan) as a result of the directions at paragraphs
(b)(i) and (b)(ii) of this Section 7.5 shall be subject to such cap on a pro

 

 

rata basis, in the same manner as applied to shareholders under the Merger
Agreement.

     (d) Merger consideration received in the form of cash pursuant to paragraphs
(b)(i) and (b)(ii) of this Section 7.5 shall be invested in the Interest Income
Fund, subject to transfer by the participant to other Investment Funds in
accordance with the provisions of subsection 6.4 of the Plan, provided, however, in
the case of Common Stock with respect to which an election for stock is filed under
paragraph (b)(i) or (b)(ii) of this Section 7.5, but all or a portion of such
merger consideration is paid in the form of cash, such proceeds shall be reinvested
in such stock as soon as practicable.

     (e) The Company and the Trustee and its designee shall take all reasonable
steps necessary to assure that participants’ individual directions shall remain
confidential. Notwithstanding the foregoing, the foregoing parties may provide
such information with respect to the vote and the choice of merger consideration as
an independent recordkeeper may require for operation of the Plan, if the recipient
of such information agrees to keep such information confidential.

     (f) Notwithstanding anything herein to the contrary, in no event shall the
Merger Investment Manager be responsible for distributing or collecting the voting
forms or merger consideration or tabulating the results thereof, nor shall the
Merger Investment Manager be given any information as to any individual
participant’s specific directions.

 

 

     IN WITNESS WHEREOF, the Company and the Trustee have caused this amendment to be executed this
_____ day of ______________________, 2005.

	 	 	 	 	 	 	 
	 	 	SEARS, ROEBUCK AND CO.	 	 
	 
	 	 	 	 	 	 
	

	 	By:
	 	 	 	 
	

	 	 	 	 	 	 
	

	 	Name:
	 	 	 	 
	

	 	Title:
	 	 	 	 

	 	 	 	 	 	 	 
	 	 	STATE STREET BANK AND TRUST COMPANY	 	 
	 
	 	 	 	 	 	 
	

	 	By:
	 	 	 	 
	

	 	 	 	 	 	 
	

	 	Title:exv4w18

 

Exhibit 4.18

SIXTH AMENDMENT TO

THE SEARS 401(K) SAVINGS PLAN

TRUST AGREEMENT

(as Amended and Restated effective January 1, 1998)

     Pursuant to the authority reserved to the Company in Section 13.1 of the Sears 401(k) Savings
Plan Trust Agreement (The “Trust Agreement”), the Trust is hereby amended in the following
respects, effective as of January 1, 2005:

	 	1.  	The Trust is hereby renamed “The Sears 401(k) Savings Plan Master Trust”.
	 
	 	2.  	The “WHEREAS” clauses and “NOW THEREFORE” clause are hereby deleted and
replaced by the following:

          WHEREAS, the Company and certain of its subsidiaries have adopted and
maintain, for the exclusive benefit of certain of their current and former
employees, certain tax-qualified plans, including a tax-qualified plan known as the
Sears 401(k) Profit Sharing Plan (the “Sears 401(k) Plan”), for the exclusive
benefit of certain of its employees and the employees of certain of its affiliates
and subsidiaries;

          WHEREAS, the Company previously established two trusts to serve as the funding
vehicles for the Plan, and the Company appointed State Street Bank and Trust
Company as successor trustee to The Northern Trust Company of New York and United
States Trust Company effective January 1, 1998, and said trusts were amended and
restated effective as of such date in the form of this Trust Agreement;

          WHEREAS, the Company desires to permit the trust of the Sears Puerto Rico
Savings Plan to invest in this Trust;

          WHEREAS, the Company may from time to time wish to cause other qualified plans
maintained by the Company to be funded by this trust;

          NOW, THEREFORE, the Company and the Trustee do hereby amend the Trust to cause
it to be a master trust and do hereby rename the Trust “The Sears 401(k) Savings
Plan Master Trust:”

	 	3.  	The definition of “Plan” in Section 1 of the Trust Agreement is hereby
revised to read as follows:

          “Plan” or “Plans” means individually and collectively, the Plans that
participate in this Trust, which are listed in Exhibit A to this Trust,

 

 

each of which is a defined contribution plan maintained by the Company or an
Employer and is either (i) qualified or deemed to be qualified under Section 401(a)
of the Code and funded by this Trust, or (ii) qualified or deemed to be qualified
under Section 1165(a) of the Puerto Rico Internal Revenue Code of 1994, as amended
(hereinafter referred to as the “PR Code”) and funded by a trust which is qualified
under Section 1165(a) of the PR Code and permitted by its terms to invest in this
Trust in accordance with Section 10.1.”

	 	4.  	Section 2.1 is hereby revised to read as follows:

          2.1 In General. This Trust Agreement constitutes an amendment,
restatement and continuation, effective as of January 1, 1998, of the previous
trust agreements entered into by and between the Company and The Northern Trust
Company of New York and United States Trust Company under the Plan. The Sears
401(k) Plan consists of both a profit sharing plan intended to qualify under
Sections 401(a) and 401(k) of the Code and an employee stock ownership plan
intended to qualify as a stock bonus plan under Section 401(a) of the Code and as
an employee stock ownership plan under Section 4975(e)(7) of the Code. The parties
intend the Trust to be a long-term investor in Common Stock, and that, regardless
of the short-term effects of a continuing investment in the Common Stock, the
Trustee shall not dispose of any such shares except to the extent required for the
day-to-day administration of the Plan and except as provided in accordance with
Section 7 of this Trust Agreement or as otherwise required by ERISA.

          Prior to December 20, 1989, the Sears 401(k) Plan consisted solely of a profit
sharing plan. Effective as of that date, the Sears 401(k) Plan was amended to add
a leveraged employee stock ownership feature in order to permit employees to
participate more fully in shareholder decisions and the enhancement of shareholder
value and to thereby assure an employee work force motivated by the long-term
interests of the Company. Common Stock acquired with the proceeds of the employee
stock ownership loan are held under this Trust Agreement both prior to and after
such Shares are released for allocation to the accounts of Plan participants.

          The Sears Puerto Rico Savings Plan is intended to qualify under Section
1165(a) of the Puerto Rico Code and shall not participate in any ESOP.

          2.2 Split Up of Section 401(k) Plan. Prior to June 30, 1995, the
Sears Section 401(k) Plan included assets attributable to a profit sharing and
stock bonus plan feature, a leveraged ESOP feature and an ESOF feature. As of June
30, 1995, the Sears Section 401(k) Plan was split into two separate plans: (1) a
profit sharing and stock bonus plan and leveraged

 

 

ESOP providing benefits to eligible employees of the Company and its
affiliates (exclusive of the Allstate Group), which continued to hold the assets
attributable to the profit sharing and stock bonus plan, ESOF and ESOP features of
the Sears 401(k) Plan which were allocable to employees and former employees of the
Company and its affiliates other than the Allstate Group and certain of the assets
held in the ESOP suspense account, and which continued to be known as the Sears
401(k) Plan; and (2) a profit sharing and stock bonus plan and leveraged ESOP
providing benefits to eligible employees of the Allstate Group, to which were
transferred the assets attributable to the profit sharing and stock bonus plan,
ESOF and ESOP features of the Plan which were allocable to employees and former
employees of the Allstate Group, and which is known as The Savings and Profit
Sharing Fund of Allstate Employees.

	 	5.  	Section 3.2 is hereby revised to read as follows:

3.2 The Plans. The Company shall be responsible for verifying that while
any assets of a Plan are held in the Trust Fund, the Plan is “qualified” within the
meaning of Section 401(a) of the Code (or Section 1165(a) of the Puerto Rico Code,
as applicable) and is intended to qualify under Section 404(c) of ERISA and the
accompanying regulations.

	 	6.  	A new Section 3.6 is hereby added:

“3.6 Accounting for a Plan’s Undivided Interest in the Trust Fund. All
transfers to, withdrawals from, and other transactions regarding the Trust Fund
shall be conducted in such a way that the proportionate interest in the Trust Fund
of each Plan and the fair market value of that interest may be determined at any
time. Whenever the assets of more than one Plan are commingled in the Trust Fund
or in any Investment Fund, the undivided interest therein of that Plan shall be
debited or credited (as the case may be) (i) for the entire amount of every
contribution received on behalf of that Plan, every benefit payment, or other
expense attributable solely to that Plan, and every other transaction relating only
to that Plan; and (ii) for its proportionate share of every item of collected or
accrued income, gain or loss, and general expense; and other transactions
attributable to the Trust Fund or that Investment Fund as a whole. As of each date
when the fair market value of the investments held in the Trust Fund or an
Investment Fund are determined, the Trustee shall adjust the value of each Plan’s
interest therein to reflect the net increase or decrease in such values since the
last such date. For all of the foregoing purposes, fractions of a cent may be
disregarded”.

	 	7.  	New paragraph (c) is hereby inserted after paragraph (b) of subsection 7.5,
and existing paragraphs (c), (d), (e) and (f) are relettered (d), (e), (f) and (g):

 

 

          (c) Notwithstanding the foregoing provisions of this subsection 7.5, with
respect to Common Stock held under the Sears Puerto Rico Savings Plan, the
provisions of Section 6.8 of the Sears Puerto Rico Savings Plan shall govern the
voting and the choice of merger consideration, with respect to such Common Stock,
under the terms of the Merger Agreement.

	 	8.  	By adding a new section 10, Participation of Other Employers, and
renumbering all subsequent sections accordingly:
	 
	 	9.  	PARTICIPATION OF OTHER EMPLOYERS.

          10.1 Adoption by Other Employers; Withdrawals. The Trust is
maintained by the Company for use as the funding vehicle for the Plans which it
maintains for various groups of employees and for use as the funding vehicle for
the Plans of any Employer.

          (a) Any Employer which has been certified to the Trustee by the Company as
being authorized and as having adopted this Trust with the consent of the Company
as a funding vehicle for its own Plans may, at any time thereafter, become a party
to this Trust Agreement by filing with the Trustee a certified copy of a resolution
of its Board of Directors evidencing its election so to do;

          (b) Any Employer which is a party to this Trust Agreement and which has been
certified to the Trustee by the Company as having adopted one or more other Plans
and as being authorized to adopt this Trust as the funding medium for such other
Plan or Plans may, at any time thereafter, adopt this Trust for the purposes of
such other Plan or Plans by filing with the Trustee a certified copy of a
resolution of its Board of Directors evidencing its election so to do; and

          (c) The trustee of any trust which (i) is exempt from taxation under Section
1165(a) of the PR Code, (ii) has been established by an Employer for the purpose of
funding one or more plans qualified under Section 1165(a) of the PR Code and
maintained for the benefit of the employees of such Employer who are residents of
and/or perform services entirely in Puerto Rico, and (iii) has been certified to
the Trustee by the Company as being authorized to invest in the assets of this
Trust, shall be permitted to invest in the Trust Fund by filing with the Trustee a
duly executed instrument evidencing its election to do so.

          Thereafter, the Trustee shall receive and hold as a part of the Trust Fund subject to
the provisions of this Trust Agreement, any deposits made to it under such Plans by or at
the direction of such Employer. Should this paragraph become operative:

 

 

          (a) In the event of the withdrawal of a Plan from the trust or in the event of
the Company’s or an Employer’s election to terminate or to fund separately the
benefits provided under any of its Plans, the Company shall cause a valuation to be
made of the share of the Trust Fund which is held for the benefit of persons having
an interest therein under such Plans. The Trustee shall thereupon segregate and
dispose of such share in accordance with the written direction of the Company
accompanied by its certification to the Trustee that such segregation and
disposition is in accordance with the terms of the Plans and the requirements of
the law.

          (b) If the Company or any Employer receives notice that one or more of its
Plans is no longer qualified under the provisions of Section 401 of the Code or the
corresponding provisions of any future Federal revenue act, the Company shall
immediately cause a valuation to be made of the share of the Trust Fund which is
held for the benefit of such persons having an interest under such disqualified
Plan or Plans. The Trustee shall thereupon segregate, withdraw from the Trust
Fund, and dispose of such share in accordance with the terms of the disqualified
Plan or Plans. The Company may direct the Trustee to dispose of such share by the
transfer and delivery of such share to itself as trustee of a separate trust, the
terms and conditions of which shall be identical with those of this Trust
Agreement, except that either the Company or the Employer maintaining such
disqualified Plan or Plans and the Trustee shall be the only parties thereto.

          (c) In the event that any group of employees covered by a Plan is withdrawn
from such Plan, the Company shall, if required by the terms of such Plan, cause a
valuation to be made of the share of the Trust Fund which is held for the benefit
of such group of employees. The Trustee shall thereupon segregate and dispose of
such share in accordance with the direction of the Company accompanied by its
certification to the Trustee that such segregation and disposition is in accordance
with the terms of such Plan and the requirements of the law.

       The Trustee shall have no duty to see that the valuation of any share in accordance
with the provisions of this Section 10.1 is caused to be made by the Company, nor to
segregate and dispose of any such share in the absence of the written direction of the
Company to do so.

       10.2 Powers and Authorities of Other Employers to be Exercised Exclusively by
Company. Each Employer, other than the Company, which is or shall become a party to
this Trust Agreement, hereby irrevocably gives and grants to the Company full and exclusive
power and authority to exercise all of the powers conferred upon it by the terms of this
Trust Agreement and to take or refrain from taking any and all action which such Employer
might otherwise take or refrain from taking with respect to this Trust Agreement, including
the sole and

 

 

exclusive power to exercise, enforce or waive any rights whatsoever which such Employer
might otherwise have with respect to the Trust Fund, and each such Employer, by becoming a
party to this Trust Agreement, irrevocably appoints the Company its agent for such
purposes. The Trustee shall have no obligation to account to any such Employer or to
follow the instructions of or otherwise deal with any such Employer, the intention being
that the Trustee shall deal solely with the Company as if the Trustee and the Company were
the only parties in this Trust Agreement.

              10. A new Exhibit A is added:

EXHIBIT A

     The Plans participating in the Trust as of January 1, 2005:

     The Sears 401(k) Profit Sharing Plan

     The Sears Puerto Rico Savings Plan

     In all other respects the Trust, as amended, will continue in full force and effect

* * * * *

     IN WITNESS WHEREOF, the Company and the Trustee have caused this amendment to be executed this 17th
day of March, 2005.

	 	 	 	 	 	 	 
	 	 	SEARS, ROEBUCK AND CO.
	 
	 	 	 	 	 	 
	

	 	By:
	 	 	 	/s/ Michael W. Coyne
	 	 	 	 	 
	 	 	Title:	 	 Vice President and Treasurer
	 
	 	 	 	 	 	 
	 	 	STATE STREET BANK AND TRUST COMPANY
	 
	 	 	 	 	 	 
	

	 	By:
	 	 	 	/s/ Lisa B. Duncan
	 	 	 	 	 
	 	 	Title:	 	Vice President

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