EFTA00609831.pdf

u....stv-I• 01761 THE LEON 13. BLACK 1997 REVOCABLE DECLARATION OF TRUST EFTA00609831  TABLE OF CONTENTS PAGE ARTICLE I: DEFINITIONS AND RULES OF CONSTRUCTION . . . 1 ARTICLE II: THE TRUST FUND 5 ARTICLE DI: REVOCABILITY 5 ARTICLE IV: THE LEON D. BLACK 1997 REVOCABLE TRUST . . . 5 ARTICLE V: DEBTS AND EXPENSES 7 ARTICLE VI: TANGIBLE PERSONAL PROPERTY 8 ARTICLE VII: RESIDENTIAL PROPERTY 10 ARTICLE VIII: GENERAL DISPOSITIONS 11 ARTICLE IX: DISPOSITION OF BALANCE OF TRUST REMAINDER 12 ARTICLE X: TRUST FOR JUDY 12 ARTICLE XI: THE DEBRA R. BLACK MARITAL TRUST OR TRUSTS 13 ARTICLE XII: TRUSTS FOR ISSUE 16 ARTICLE XIII: SPECIAL DISTRIBUTION RULES 20 ARTICLE XIV: RENUNCIATIONS 23 ARTICLE XV: SURVIVORSHIP PROVISIONS 24 ARTICLE XVI: TRUSTEES' POWERS 25 ARTICLE XVII: RESTRICTIONS ON TRUSTEE POWERS 32 ARTICLE XVDI: ACCOUNTING BY TRUSTEES 33 ARTICLE XIX: TRUSTEE APPOINTMENTS, RESIGNATIONS AND COMPENSATION 34 EFTA00609832 ARTICLE XX: ACTION BY TRUSTEES 39 EFTA00609833  DECLARATION OF TRUST made the 30thday of September. 1997, by LEON D. BLACK. as Senior and as Trustee. ARTICLE I: DEFLNITIONS AND RULES OF CONSTRUCTION (A) Senior's Family. The Senior is married to DEBRA R. BLACK ("DEBRA"). The Senior has four (4) children, BENJAMIN ELI BLACK, JOSHUA MAX BLACK, ALEXANDER SAMUEL BLACK and VICTORIA RACHEL BLACK, who together with all children born to or adopted by the Senior after the date this Declaration of Trust is executed are collectively referred to as the "Senior's Children." (B) Definitions. For purposes of this Declaration of Trust, the following words and expressions shall have the following meanings and usages: (1) "Article": an Article of this Declaration of Trust. (2) "Code": the Internal Revenue Code of 1986. (3) "Death Taxes": all estate, inheritance, transfer, succession, legacy, or other death taxes (excluding generation-skipping transfer taxes), together with all interest and penalties thereon, if any, levied or assessed by reason of an individual's death by any governmental authority, domestic or foreign, with respect to (a) any property, whether that property is disposed of under or apart from or was disposed of apart from such individual's will and (b) any amount included in such individual's gross estate under § 2035(c) of the Code or any similar provision of state law. (4) "Declaration of Trust": this Declaration of Trust. (5) "disability": except as otherwise provided, an individual shall be deemed under a disability or to have suffered a disability if and for so long as such individual lacks sufficient understanding or capacity to make and communicate decisions about his or her property, his or her business affairs or matters concerning a Trust in or over which he or she EFTA00609834 holds an interest or power. The existence of a disability shall be established (i) by the written opinion of two licensed physicians or psychiatrists appointed by the Trustees (other than such individual) that a disability (as defined in the preceding sentence) exists. or (ii) by the determination of a court of competent jurisdiction that such individual is under a legal disability. (6) "EPTL": the New York Estates, Powers and Trusts Law. (7) "generation " "GST exemption" and "inclusion ratio": the same meanings as those ascribed to them in chapter 13 of the Code. (8) "Independent Trustees": the Trustees other than (a) the Settlor. (b) DEBRA. or (c) one of the Senior's issue. (9) "issue": all descendants of the designated ancestor who are descended from such ancestor by blood or adoption. provided that an individual adopted after his or her eighteenth (18th) birthday and his or her descendants shall be deemed not to be issue of the adopted individual's adoptive parent or parents or any ancestor of the adopted individual's adoptive parent or parents. (10) "legal disability": an individual shall be deemed under a legal disability if he or she (i) is a minor. (ii) has been legally declared incompetent, or (iii) is an individual for whom a guardian, conservator or similar fiduciary (however denominated in the relevant jurisdiction) has been appointed. (11) "personal representatives": as to a given individual, the person or persons. whether denominated as executors, administrators, personal representatives or otherwise, duly authorized to administer that individual's estate pursuant to that individual's Will in the jurisdiction in which such Will is admitted to original probate, or pursuant to the laws governing the administration of that individual's estate. if he or she died without a Will. 2 EFTA00609835  (12) "Oualified Charitable Organization": an organization that is described in § 170(c)(2). § 2055(a) and § 2522(a) of the Code, and that is an organization exempt from taxation under § 501(a) of the Code as an organization described in § 501(c)(3) of the Code on the date that any distribution is made to it under this Declaration of Trust. (13) "Senior's spouse": at any particular time. the individual to whom the Senior is married and with whom the Settlor is living, or. if the Settlor is not living, the individual to whom the Senior was married and with whom the Senior was living at the time of the Senior's death, whether or not that individual has remarried. For purposes of this subsection, separation for reasons other than marital discord shall be ignored. The Independent Trustees shall determine whether an individual is or was the Senior's spouse at any particular time and any such determination shall be binding and conclusive on all persons who in any way may be affected thereby. (14) "Settlor": LEON D. BLACK. (15) "Trust": a particular one of the Trusts. (16) "Trustees": each Trustee and all Trustees serving under this Declaration of Trust at any given time. (17) "Trust Fund": as to any Trust, all property (principal plus accrued. accumulated and undistributed income) that, at any particular time, belongs to that Trust. (18) "Trusts": all separate trusts held under this Declaration of Trust at a particular time. (19) "Will": the Last Will and Testament of an individual, whenever executed, that is duly admitted to probate. (C) Rules of Construction. For purposes of this Declaration of Trust, the following rules of construction shall apply: 3 EFTA00609836  (1) All references to a body of laws or regulations (such as the Code and the Treasury Regulations promulgated thereunder) or to any provision thereof, shall be deemed to refer to such body of laws or regulations. or provision thereof, as the same may be amended from time to time, and shall be deemed to refer as well to any subsequent body of laws or regulations or provisions thereof enacted in its place. (2) All references to Articles. sections and other subdivisions refer to the corresponding Articles, sections and other subdivisions of this Declaration of Trust unless otherwise specifically provided. (3) Except where the context otherwise requires. (i) words importing the masculine gender include the feminine and the neuter, if appropriate. (ii) words importing the singular number include the plural number and vice versa, and (iii) words importing persons include firms, associations, corporations and other entities. (4) A document shall be deemed to have been delivered to a person at such time as it is actually received by such person. (5) The titles of Articles and headings of sections contained in this Declaration of Trust are included solely for convenience of reference, and may not be used to construe any provision contained in this Declaration of Trust or for any other purpose. (D) New York Law. Except as provided in Article XVI(A)(14). all questions pertaining to the validity, construction and administration of this Declaration of Trust and the Trusts shall be determined in accordance with the laws of the State of New York in effect from time to time. 4 EFTA00609837  ARTICLE H: THE TRUST FUND The Senior hereby declares that he holds the property described in Schedule "A" annexed hereto in trust in his capacity as Trustee under this Declaration of Trust, and agrees to manage and dispose of the same in accordance with the provisions of this Declaration of Trust. This property shall be the original Trust Fund of a Trust, the dispositive provisions of which are set forth in Article IV. This Trust may be identified as the "LEON D. BLACK 1997 REVOCABLE TRUST." This Declaration of Trust may be identified as the "LEON D. BLACK 1997 REVOCABLE DECLARATION OF TRUST." ARTICLE REVOCABILITY This Declaration of Trust and the Trusts may be altered, amended, revoked or terminated by the Senior, in whole or in part, at any time or from time to time, by instrument in writing, signed by the Settlor and duly acknowledged, and delivered prior to the Senior's death to the Trustees other than the Senior, or, if the Senior is the only Trustee then serving, to the successor Trustees designated either by name in Article XIX(A)(1) or pursuant to Article XIX(B). ARTICLE IV: THE LEON D. BLACK 1997 REVOCABLE TRUST Following are the dispositive provisions of the LEON D. BLACK 1997 REVOCABLE TRUST: (A) Withdrawals by Settlor. During the Senior's life, the Trustees shall pay to him or apply for his benefit as much or all of the Trust Fund as the Settlor shall request, at 5 EFTA00609838 any time or from time to time. The Settlor may at any time require payment to himself of the entire Trust Fund notwithstanding that such action may result in the termination of the Trust. (B) Discretionary Distributions to Settlor. ( I) The Trustees. at any time or from time to time. may pay to the Senior, or apply for his benefit, as much or all (or none) of the Trust Fund as the Trustees. in their sole discretion, shall determine, notwithstanding that such action would result in the termination of the Trust. (2) The Trustees are authorized to direct the payment of any portion of the Trust Fund that they shall have decided to distribute to or for the benefit of the Settlor in accordance with the provisions of this section at any time and from time to time. irregularly or at fixed intervals, in such amounts and in equal or unequal payments, as the Trustees shall find convenient and appropriate. Any such payment may be made directly to the Settlor. or for the Settlor's benefit to any person with whom the Senior resides or who is otherwise responsible for his custody and welfare, or for the Settlor's benefit to such other person as the Trustees, in their sole discretion, shall deem advisable. The Trustees are further authorized to pay any portion of such income and principal directly to the Settlor's creditors in payment of his obligations. In exercising the discretion conferred in this section, the Trustees need not, but may. take into account the Settlor's assets, income and other financial resources apart from this Trust. (C) Accumulations. At the end of each calendar year. the Trustees shall accumulate and add to principal any net income not paid or applied pursuant to the preceding provisions of this Article. (D) Additions to Trust. The Settlor may add property to this Trust (i) by lifetime transfers of additional property; (ii) by Will; (iii) by naming the Trustees as beneficiaries of one or more life insurance policies; or (iv) by any other means. The Trustees need not retain any additional property in the form received. 6 EFTA00609839  (E) Termination. This Trust shall terminate upon the Settlor's death, and the Trust Fund, together with any property distributed to the Trustees under the Settlor's Will (together. the "Trust Remainder"), shall be disposed of as provided in Articles V through XII. ARTICLE V: DEBTS AND EXPENSES (A) Death Taxes. (1) All of the Settlor's Death Taxes imposed with respect to all property comprising the Trust Remainder shall be paid from the balance of the Trust Remainder disposed of under Article IX, without apportionment within that portion of the Trust Remainder. (2) The Trustees may either pay such Death Taxes directly to the appropriate governmental authority collecting the same or pay the same to the Settlor's personal representatives, and in either case, the Trustees may rely, without further investigation, upon a written statement submitted to the Trustees by the Settlor's personal representatives as to the amount of such Death Taxes and the time at which the same must be paid. The Trustees shall have no duty to inquire as to the propriety or correctness or of any such payment, or to see to the application thereof, and any payment to such personal representatives or to such governmental authority shall be a full and complete discharge to the Trustees with respect to such payment. The Trustees may subject themselves and the Trust Fund to the jurisdiction of any Court within or without the State of New York in order to determine or apportion such taxes, irrespective of the domicile of the Settlor at his death. (B) Insufficiency of Testamentary Property. If the Senior's personal representatives certify to the Trustees that the Settlor's testamentary property is insufficient to provide for the payment of the Senior's debts, funeral expenses and the administration expenses of his estate, then the Trustees shall pay to the Senior's personal representatives the amount that the Settlor's personal representatives certify is required to make up the deficiency. 7 EFTA00609840 Alternatively, the Trustees may pay such debts, funeral expenses and administration expenses directly. in whole or in part. Any such payment shall be charged against and paid as an administration expense from the Trust Remainder disposed of in Article IV(E). The Trustees shall have no duty or obligation to inquire as to the correctness or propriety of any amount so certified by the Senior's personal representatives. or to see to the application thereof, and the payment of such amount to such personal representatives or directly to the obligee shall be a full and complete discharge to the Trustees with respect to such payment. ARTICLE VI: TANGIBLE PERSONAL PROPERTY Upon the death of the Settlor. all of the Senior's tangible personal property that is held in or added to the Trust at the Senior's death shall be disposed of as follows: (A) Disposition of Works of An. (1) If DEBRA survives the Settlor. the Trustees shall hold all of the Senior's works of art, the Senior's collection of first edition books and the Senior's collection of canes (including cane stands and glass cases) in as many separate Trusts, each upon the terms set forth in Article XI, as the Trustees shall determine. If DEBRA does not survive the Settior. the Trustees shall distribute this property among those of the Senior's Children who survive the Senior in shares of substantially equal value as the Independent Trustees, in their sole discretion shall determine, subject to the provisions of Article XII. If any of the Senior's Children does not survive the Settior but has issue who survive the Senior, the share of this property that such child would have received if he or she had survived the Senior shall be distributed to his or her issue who survive the Senior, subject to the provisions of Article XII. The Settior requests, but does not require, that the Independent Trustees take into account the Senior's wishes as to how this property should be divided among the Senior's Children and more remote issue as will be set forth in a letter the Senior will deliver to them during the Senior's lifetime. 8 EFTA00609841  (2) For purposes of this Declaration of Trust, the term "works of art" shall mean paintings, drawings. pictures. and sculptures, including archaic Chinese bronzes and Chinese terra cotta figures. The decision of the Independent Trustees as to whether any particular item of tangible personal property is a work of art shall be binding and conclusive upon all persons who may in any way be affected thereby. (B) Disposition of Remaining Tangible Personal Property. If DEBRA survives the Senior, the Trustees shall distribute to DEBRA all of the Senior's remaining tangible personal property. together with all insurance policies thereon, if any. If DEBRA does not survive the Settior, those of the Settlor's Children who survive the Senior shall divide such remaining tangible personal property among themselves as they agree. If and to the extent they cannot agree as to any items of such property, or if any of these children is a minor, the Trustees shall distribute such items, in whole or in part. among those of the Senior's Children who survive the Senior in shares of substantially equal value as the Independent Trustees, in their sole discretion, shall determine. If only part or none of these items is distributed among the Senior's surviving children, the Independent Trustees shall sell such portion of the undistributed balance as they, in their sole discretion, determine shall be sold (adding the proceeds of sale to the balance of the Trust Remainder disposed of under Article IX), and shall add the unsold portion of such undistributed balance to the balance of the Trust Remainder. (C) Definition of Tangible Personal Property. For purposes of this Article, the term "my tangible personal property" shall include, but not be limited to. the Senior's clothing, jewelry, personal effects, books, automobiles, household furniture and furnishings, silverware, china, and all other items of tangible personal property which the Senior owns at his death, but shall exclude cash and coins that do not have numismatic value. 9 EFTA00609842  (D) Expenses. The Trustees shall pay the reasonable expenses of storing, insuring, packing, and shipping the Settlor's tangible personal property. and of delivering the same to the appropriate beneficiary as administration expenses from the Trust Remainder disposed of in Article IV(D). ARTICLE VII: RESIDENTIAL PROPERTY Upon the death of the Settlor. all of the Settlor's residential property that is held in or added to the Trust at the Senior's death shall be disposed of as follows: (A) Disposition if DEBRA Survives the Senior. If DEBRA survives the Senior, the Trustees shall distribute to DEBRA all of the Senior's residential property. (B) Disposition if DEBRA Does Not Survive the Sailor. If DEBRA does not survive the Senior, the Trustees shall sell the Senior's residential property and add the proceeds to the Settlor's residuary estate unless the Trustees believe that it would be in the best interests of the beneficiaries of the Trust Remainder (or any one or more of them) to add this property to the balance of the Trust Remainder, in which case this property shall be added to the balance of the Trust Remainder disposed of under Article IX. (C) Definition of Residential Property. For purposes of this Declaration of Trust, the term "residential property" shall mean all of the Settlor's right, title and interest in and to any residence that the Senior owns or in which the Settlor has an interest at his death that DEBRA or the Settlor use as a permanent or occasional residence, including any contiguous surrounding property, and together with all policies of insurance on such residences. The property referred to in the preceding sentence shall include real property (together with buildings, fixtures, and improvements thereon), interests in condominium units (including common areas), and cooperative apartments (together with proprietary leases and shares of stock relating thereto). 10 EFTA00609843  ARTICLE VIII: GENERAL DISPOSITIONS (A) Cash Dispositions. (1) If DEBRA survives the Settlor. the Trustees shall pay DEBRA an amount equal to the difference between (a) TWENTY-FIVE MILLION (S25.000.000) DOLLARS and (b) the proceeds of any life insurance policies DEBRA receives as a result of the Senior's death. (2) If the Senior's sister JUDY BLACK ("JUDY") survives the Settlor. the Trustees shall hold the sum of FIVE MILLION DOLLARS (S5.000,000) in a Trust upon the terms set forth under Article X. (B) Disposition of Remaining GST Exemption. (1) If DEBRA does not survive the Senior. the Trustees shall set aside an amount equal to the Senior's remaining GST exemption. The Trustees shall divide such amount into as many equal shares as there are children of the Senior who survive the Senior and children of the Senior who do not survive the Senior but have issue who survive the Senior. One such share shall be paid to (a) each child of the Senior who survives the Senior and (b) the issue who survive the Settlor of each child of the Senior who does not survive the Senior. subject. in each case, to the provisions of Article XII. (2) The Senior's "remaining GST exemption" is the maximum GST exemption allowed to an individual by § 2631(a) of the Code reduced by the aggregate amount of GST exemption allocated by the Senior or by operation of law to transfers made by the Settlor during his life, or allocated by the Trustees or the Senior's personal representatives to transfers made by the Senior during his life, to property passing apart from this Declaration of Trust or to property passing under other provisions of this Declaration of Trust. In computing the Senior's remaining GST exemption, property shall be valued as finally determined for federal estate tax purposes in the Senior's estate. The Senior recognizes that his remaining 11 EFTA00609844 GST exemption may be zero. in which case nothing shall pass pursuant to this section. and that the amount of the Settlor's remaining GST exemption may be affected by the actions of the Trustees or the Senior's personal representatives in exercising certain tax elections. ARTICLE IX: DISPOSITION OF BALANCE OF TRUST REMAINDER The balance of the Trust Remainder, whether real or personal. and wherever located, shall be paid as follows: (A) Disposition if DEBRA Survives the Senior. If DEBRA survives the Settior. the Trustees shall hold such property in as many separate Trusts, each upon the terms set forth in Article XI. as the Trustees shall determine. (B) Disposition if DEBRA Does Not Survive the Sailor. If DEBRA does not survive the Senior, the Trustees shall distribute such property to the Senior's issue who survive the Senior. subject to the provisions of Article XII. ARTICLE X: TRUST FOR JUDY Following are the dispositive terms of the Trust directed to be held for JUDY's benefit upon the terms set forth in this Article. (A) Income Paid Currently. During the lifetime of JUDY. the Trustees shall pay to her, or apply for her benefit, the entire net income in quarter-annual installments or more frequent installments as may be convenient to the Trustees. (B) Principal Invasion. The Trustees shall pay to JUDY, or apply for her benefit, for any reason or purpose whatsoever, as much or all (or none) of the principal as the Independent Trustees, in their sole discretion, shall determine at any time or from time to time. In exercising the discretion granted in this section. the Independent Trustees need not. but may, consider JUDY's assets and income apart from the Trust. The Senior confirms that 12 EFTA00609845 pursuant to this section. the Trustees may. at any time. distribute the entire Trust Fund to JUDY. even though such distribution terminates the Trust, and without regard to the interest of any remainderman of the Trust. (C) Disposition on Termination. Unless sooner terminated by the distribution of the entire Trust Fund, the Trust shall terminate upon JUDY's death. Upon such termination, the Trustees shall pay the Trust Fund to JUDY's issue then living, or, if there are none, to the Settlor's issue then living, subject to the provisions of Article XII. or. if there are none, to those of DEBRA's brothers. BRUCE RESSLER. JOHN RESSLER. RICHARD RESSLER and ANTHONY RESSLER. who are then living, in equal shares. provided that if a brother of DEBRA is not then living but has issue then living, the share such brother would have received had he survived JUDY shall be paid to his then living issue. Any property passing to any issue of the Settlor pursuant to this section "(C)" shall not be paid to such issue outright, but shall be paid to the Trustees, to be held in Trust upon the terms set forth in Article XII. ARTICLE XI: 111E DEBRA R. BLACK MARITAL TRUST OR TRUSTS Following are the dispositive terms of each of the separate Trusts directed to be held upon the terms set forth in this Article. Each such Trust shall be known as the "DEBRA R. BLACK MARITAL TRUST" followed by such letter as is assigned to such Trust by the Trustees. (A) Income Paid Currently. During the lifetime of DEBRA, the Trustees shall pay to her, or apply for her benefit, the entire net income in quarter-annual installments or more frequent installments as may be convenient to the Trustees. 13 EFTA00609846  (B) L'nproductite Property. DEBRA shall have the power to require the Trustees to convert unproductive or under-productive property to income-producing property that produces a reasonable rate of return. (C) Principal Invasion. (1) The Trustees shall pay to DEBRA. or apply for her benefit, for any reason or purpose whatsoever, as much (or none) of the principal as the Independent Trustees. in their sole discretion, shall determine at any time or from time to time. In exercising the discretion granted in this section. the Independent Trustees need not. but may, consider DEBRA's assets and income apart from the Trust. (2) Notwithstanding the provisions of subsection "(1)" of this section "(C)," the aggregate value of all payments to or applications for the benefit of DEBRA made from principal during the term of the Trust shall not exceed TWENTY (20%) PERCENT of the value of the initial principal of the Trust as finally determined for federal estate tax purposes. (D) Use of Works of Art. With respect to any works of art that become the property of this Trust, the Senior directs the Trustees (in addition to the powers and authorities conferred upon the Trustees by law or by other provisions of this Declaration of Trust): (1) To permit DEBRA to use and/or display such works of art, rent-free and without bond or other security, for as long as she wishes: (2) To retain such property until the termination of the Trust, subject, however, in all events. to DEBRA's overriding power to require that the Trustees sell all or any part of such property or otherwise cause it to produce a reasonable rate of return: and (3) To pay all expenses and carrying charges relating thereto from the Trust, or from any other Trust under this Article, including without limitation, all maintenance, improvements, insurance and repairs, charging against income only those expenses that are required to be charged against income under the EPTL. 14 EFTA00609847  (E) Disposition on Termination. The Trust shall terminate upon DEBRA's death. Upon such termination, the Trustees shall pay all accrued and undistributed income to DEBRA's executors or administrators. The then principal of the Trust shall be disposed of as provided in the following sentences of this section. The Trustees shall pay to DEBRA's executors or administrators such part or all of the "Excess Taxes" (as defined below) as the Trustees, in their sole discretion, shall deem advisable. The Trustees shall then pay the remaining principal to the Settlor's issue who survive DEBRA. subject to the provisions of Article XII. If at the time of DEBRA's death, the Trustees hold any property that they received pursuant to Article VI. the Settlor requests. but does not require, that the Independent Trustees take into account the Settlor's wishes as to how this property should be divided among the Senior's issue as will be set forth in a letter the Settlor will deliver to them during his lifetime. (F) Definition of Excess Taxes. For purposes of this Article, the term "Excess Taxes" shall mean the excess of DEBRA's Death Taxes over the sum of: (1) the amount that DEBRA's Death Taxes would have been had no property in any of the Trusts under this Article been included in her gross estate or in her adjusted taxable gifts for federal estate tax purposes. (2) the maximum amount that DEBRA's estate is entitled to recover from all such Trusts (after giving effect to DEBRA'S will) pursuant to § 2207A of the Code or § 2-1.12 of the EPTL or any similar provision of the law of any other state, and (3) all of DEBRA's Death Taxes actually apportioned against such Trusts pursuant to § 2-1.8 of the EPTL or any similar provision of the law of any other state. 15 EFTA00609848  ARTICLE XII: TRUSTS FOR ISSUE If any share of the property passing under Article IX or of the balance of the Trust Remainder or of any terminating Trust (including any Trust under this Article) would otherwise be payable (other than by reason of the exercise of a discretionary power or of a power of appointment granted under this Declaration of Trust) to any issue of the Senior, such share shall not be paid outright to such issue (referred to in this Article as the "Beneficiary"). but shall, instead, be held by the Trustees in as many separate Trusts. each upon the terms set forth in this Article, as the Trustees shall direct. Notwithstanding the preceding provisions of this paragraph. all property with an inclusion ratio of zero shall be held in a separate Trust or Trusts and shall not be combined with a Trust which holds property with an inclusion ratio of more than zero. (A) Discretionary Distributions. (1) The Trustees shall pay to the Beneficiary, or apply for his or her benefit, for any reason or purpose whatsoever, as much or all (or none) of the Trust Fund as the Independent Trustees, in their sole discretion, shall determine at any time or from time to time. In exercising the discretion granted in this section, the Independent Trustees need not. but may, consider the Beneficiary's assets and income apart from the Trust. At the end of each year. the Trustees shall add to principal any net income not so paid or applied. The Senior confirms that pursuant to this section, the Trustees may, at any time, distribute the entire Trust Fund to or for the benefit of the Beneficiary, even though such distribution terminates the Trust, and without regard to the interest of any remainderman of the Trust. (2) It is the Settior's desire, but not the Senior's direction, that when the Beneficiary attains thirty-five (35) years of age, the Trustees distribute to the Beneficiary TEN (10%) PERCENT of the Trust Fund. 16 EFTA00609849  (B) Use of Works of Art. With respect to any works of art that become the property of this Trust, the Settlor authorizes the Trustees (in addition to the powers and authorities conferred upon the Trustees by law or by other provisions of this Declaration of Trust): ( I) To permit the Beneficiary to use and/or display such works of art, rent- free and without bond or other security, for as long as he or she wishes: (2) To retain such property until the termination of the Trust, whether or not he or she uses such property for personal purposes. and notwithstanding that it may not be of a kind or quality usually considered suitable for Trustees to select or hold: and (3) To pay all expenses and carrying charges relating thereto from this Trust. including without limitation, all maintenance, improvements, insurance and repairs. charging against income only those expenses that are required to be charged against the income under the EPTL. (C) Right to Direct Payment. (1) In each calendar year after the year in which the Beneficiary attains twenty-five (25) years of age and prior to the year of the Beneficiary's death, the Beneficiary shall have the absolute right, from time to time, to direct the Trustees to pay him or her out of the principal of the Trust an aggregate amount not exceeding three percent (3%) of the Trust Fund valued on the last day of the calendar year in which the Beneficiary submits such direction or directions (the "Annual Amount"). For purposes of this section. the term "calendar year" shall include the portion of the calendar year of the Senior's death that follows the Settlor's death, but shall not include the portion of the year of the Beneficiary's death that precedes his or her death. The right to direct payment shall be noncumulative and shall be exercised by a written instrument signed by the Beneficiary alone and delivered to the Trustees prior to the close of such year. 17 EFTA00609850  (2) In any given calendar year. the Trustees are authorized to make payments to the Beneficiary on account of the Annual Amount based upon the value of the principal of the Trust at the time of such request. notwithstanding that (i) the Annual Amount cannot be precisely determined until the end of such year and (ii) the Beneficiary may not be living at the end of such year. If it is determined, after the end of such year. that there has been an overpayment, then the Beneficiary shall repay to the Trustees the amount by which the aggregate payments made in such year on account of the Annual Amount exceed the Annual Amount. The executor or administrator of the Beneficiary's estate shall repay to the Trustees an amount equal to the aggregate payments. if any, made to the Beneficiary during the year of his or her death. (3) Subsections "(1)" and "(2)" of this section "(C)" shall not apply with respect to a Trust holding property which has an inclusion ratio for generation-skipping transfer tax purposes of zero. (D) Powers of Appointment. (1) Upon reaching the age of twenty-five (25) years. the Beneficiary shall have the absolute power to appoint, by will which is duly admitted to probate and which makes specific reference to this section or by written instrument which takes effect at his or her death and which is signed and acknowledged by him or her, any pan or all of the Trust Fund to or for the benefit of any individual other than the Beneficiary, his or her estate, his or her creditors, or the creditors of his or her estate, either outright or in further trust, upon such terms and conditions, as the Beneficiary shall determine. (2) (a) The Independent Trustees, at any time, may grant to the Beneficiary a general power of appointment (as defined in § 2041 of the Code), which may be subject to such restrictions as the Independent Trustees set forth in the instrument by which the power is granted. However, (i) the Independent Trustees may not grant a general power of appointment to the Beneficiary unless the Trust has an inclusion ratio, for generation-skipping 18 EFTA00609851 transfer tax purposes. greater than zero and (ii) the Independent Trustees shall prohibit the Beneficiary from appointing during the Beneficiary's lifetime to or for the benefit of any person or entity assigned to a generation above the Beneficiary's generation. The gram of this power shall be effected by written instrument signed by a majority of the Independent Trustees and delivered to the Beneficiary. and may be revoked at any time during the Beneficiary's lifetime by written instrument of revocation signed by a majority of the Independent Trustees and delivered to the Beneficiary. If revoked, a new power of appointment may be granted as provided in the preceding provisions of this section. (b) Without limiting the purposes for which the Independent Trustees may grant a general power of appointment to the Beneficiary, the Senior requests that they give particular consideration to the likelihood that generation-skipping transfer taxes imposed on the Trust at the Beneficiary's death would exceed the estate taxes otherwise payable if the Trust Fund were included in the Beneficiary's gross estate for estate tax purposes. For this purpose. the Independent Trustees may rely conclusively on a statement provided by or on behalf of the Beneficiary as to the potential value of his or her gross estate. (E) Disposition on Termination. Unless sooner terminated by the distribution of the entire Trust Fund, the Trust shall terminate upon the Beneficiary's death. The Trustees shall pay the Trust Fund, to the extent not effectively appointed by the Beneficiary pursuant to a power granted under this Article. (a) to the Beneficiary's issue who survive the Beneficiary, or, if there be no such issue, (b) to the then surviving issue of the Beneficiary's nearest ancestor who was descended from me and who has issue who survive the Beneficiary, or. if there be no such ancestor or issue, (c) to the Settlor's issue who survive the Beneficiary, subject, in each case, to the provisions of this Article. (F) Termination on Perpetuities Date. Notwithstanding any other provision of this Declaration of Trust, each Trust under this Article shall terminate, unless it shall have 19 EFTA00609852 sooner terminated. twenty-one (21) years after the death of the last survivor of such of the issue of the Settlor's mother and such of the issue of DEBRA's mother as were living at the date of the Senior's death, and the Trustees shall pay the Trust Fund to the Beneficiary of that Trust (free of trust). ARTICLE XIII: SPECIAL DISTRIBUTION RULES (A) Distributions By Representation. Except as otherwise provided. mandatory distributions or payments of property to the issue of a particular individual (whether or not subject to Article X111 shall be distributed to or paid to such issue by representation, as determined under the provisions of § 1-2.16 of the EPTL. The preceding sentence shall not apply to discretionary distributions or payments or to payments made pursuant to the exercise of a power of appointment granted under this Declaration of Trust. (B) Distributions to Persons Under a Legal Disability. Distribution of any money or other property under this Declaration of Trust to a person who is a minor or who is under some other legal disability may, in the sole discretion of the Trustees, be made directly to that person. to that person's parent. or to that person's guardian. conservator, or committee in whatever jurisdiction appointed: or in the case of a person who is younger than twenty-one (21) years of age, whether or not a minor, and whether or not under legal disability, to a custodian (to be selected by the Trustees) for such person's benefit under the Uniform Gifts to Minors Act or the Uniform Transfers to Minors Act of any jurisdiction and, if permitted by the applicable Act, a "minor" shall be deemed to attain majority at twenty-one (21) years of age; and the receipt of the one to whom distribution is made shall be a full discharge in respect of the distributed money or other property even though the issuer of the receipt is a Trustee. 20 EFTA00609853  (C) Undisposed of Property. If any share of the Trust Remainder or of any Trust or Trusts shall not be completely disposed of by the other provisions of this Declaration of Trust, then such undisposed of share or shares shall be disposed of as follows: (1) FIFTY MILLION ($50,000,000) DOLLARS shall be paid to JUDY, if she is then living; (2) TWENTY MILLION ($20,000,000) DOLLARS shall be paid to JON RESSLER, if he is then living; (3) TWENTY MILLION ($20,000,000) DOLLARS shall be paid to IRA and DOROTHY RESSLER, or the survivor of them, if either of them is then living; (4) TEN MILLION ($10,000,000) DOLLARS shall be paid to SAMANTHA RESSLER, if she is then living; (5) TEN MILLION ($10,000,000) DOLLARS shall be paid to JILLIAN RESSLER, if she is then living; (6) TEN MILLION ($10,000,000) DOLLARS shall be paid to ANDREW RESSLER, if he is then living; (7) TEN MILLION ($10,000,000) DOLLARS shall he paid to REBECCA RESSLER, if she is then living; (8) TEN MILLION (S10.000.000) DOLLARS shall be paid to MATTHEW RESSLER, if he is then living; (9) TEN MILLION ($10,000,000) DOLLARS shall be paid to MICHAEL RESSLER, if he is then living; (10) TEN MILLION ($10,000,000) DOLLARS shall be paid to OLIVER RESSLER, if he is then living; (11) TEN MILLION ($10,000,000) DOLLARS shall be paid to NICKOLAS RESSLER, if he is then living; 21 EFTA00609854  (12) TEN MILLION (510,000,000) DOLLARS shall be paid to JONATHAN LEVINE, if he is then living; (13) FIVE MILLION (55.000.0001 DOLLARS shall be paid to MARILYN STEWART, if she is then living; (14) If the aggregate of the property to be disposed of in sections "(1)" through "(13)" inclusive, of this section "(C)" shall be insufficient to make the dispositions described therein, such dispositions shall be abated proportionately; and (15) The balance of such undisposed of property, if any, after making the dispositions in subsections "(1)" through "(13)" of this section "(C)" inclusive, shall be paid to the LEON BLACK FAMILY FOUNDATION, INC. (the "Foundation"), if it is then a Qualified Charitable Organization. It is my desire that the directors of the Foundation expend this disposition for the following purposes: (a) TWENTY-FIVE (25%) PERCENT thereof shall be used to promote medical research; (b) TWENTY-FIVE (25%) PERCENT thereof shall be used to promote Judaica; (c) TWENTY-FIVE (25%) PERCENT thereof shall be used to promote art and culture; and (d) TWENTY-FIVE (25%) PERCENT thereof shall be used to promote education. If the Foundation is not a Qual ed Charitable Organization at the time of my death, the balance of such undisposed of property shall be paid to one or more Qualified Charitable Organizations in such amounts or proportions as the Trustees, in their sole discretion, shall determine, provided, however, that such undisposed of property shall be used for the purposes provided in paragraphs (a) through (d) inclusive of this subsection "(15)." 22 EFTA00609855  (D) Assignment of Trust Interests. With (but only with) the written consent of the Independent Trustees. (i) a disposition. charge. or encumbrance of the income or principal of any Trust, or any part thereof, by way of anticipation, alienation. or otherwise shall be valid and binding upon the Trustees and (ii) a beneficiary of any Trust may assign. transfer, encumber or otherwise dispose of such income or principal, or any part thereof. prior to its payment to such beneficiary by the Trustees. No income or principal of any Trust or any part thereof shall be liable to any claim of any creditor. This section shall apply notwithstanding any contrary provision of law, (E) Judicial Intervention. Under no circumstances shall § 7-1.6 of the EPTL or any similar provisions of law apply to any Trust. ARTICLE XIV: RENUNCIATIONS If DEBRA renounces her income interest in any portion of the property in any DEBRA R. BLACK MARITAL TRUST, or her interest in any other disposition under this Declaration of Trust, the Trustees shall hold such property in as many separate Trusts as the Trustees shall determine, each upon the following terms: (A) Discretionary Distributions. The Trustees shall pay or apply as much or all (or none) of the Trust Fund for any purpose whatsoever, as the Independent Trustees, in their sole discretion, shall determine at any time or from time to time, to or for the benefit of any one or more members of a class consisting of DEBRA and the Settlor's issue livi