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JEFFREY E. EPSTEIN
AS
GRANTOR
TO
ERIKA A. KELLERHALS
AND
RICHARD KAHN
AS
TRUSTEES
OF
THE 2013 BUTTERFLY TRUST
31 ,
DATED DECEMBER 2013
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TRUST AGREEMENT dated December SI, 2013 by and among
JEFFREY E. EPSTEIN, as Grantor, and ERIKA A. KELLERHALS, a U.S. citizen
residing in the U.S. Virgin Islands and RICHARD KAHN, a U.S. citizen residing
in the State of New York as Trustees,
FIRST
Transfer to Trustees
The Grantor hereby transfers to the Trustees, IN TRUST, and the
Trustees hereby acknowledge receipt of, the property listed in Schedule A hereto.
Said property and all investments and reinvestments thereof, and all proceeds
thereof which constitute principal, and any property hereafter transferred to the
Trust, are hereinafter collectively called "principal."
SECOND
Definitions
Wherever used in this Trust Agreement:
A. The word "Trustees" and all references to the Trustees shall
mean and refer to the Trustees hereinbefore named and any successor or substitute
Trustees or Trustee, as may be acting hereunder from time to time and shall be
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construed in the masculine, feminine or neuter and in the singular or plural,
whichever is consistent with the facts prevailing at any given time.
B. The words "IN TRUST" shall mean "'in trust, nevertheless, to
hold, manage, invest and reinvest, and, until payment thereof as hereinafter
directed, to receive the income thereof."
C. The word "pay" shall, where applicable, mean "convey, transfer
and pay" and the word "payment" shall, where applicable, mean "conveyance,
transfer and payment."
D. The word "Trust" shall mean the trust created under this Trust
Agreement.
E. The words "Code" and "Internal Revenue Code" shall mean
and refer to the Internal Revenue Code of 1986, as the same shall have been
amended from time to time.
THIRD
Dispositive Provisions
A. The Trustees, in their complete and uncontrolled discretion are
authorized to distribute any part or all of the income or principal of the Trust
(either outright or in further trust, upon such terms and conditions as the Trustees
shall determine in their sole and absolute discretion) to any one or more persons
then living from a class consisting of
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, Ghislaine N. Maxwell, Karyna Shuliak,
ME
, Jean Luc Brunel,
Lesley Katherine Groff, Lawrence Paul Visoski, Jr., Luciano A.
Fontanilla, Jr., Rosalyn v. Fontanilla in such amounts and proportions and to the
exclusion of any one or more of them as the Trustees may determine. This power
of distribution shall include the power to distribute all of the Trust assets, thereby
terminating the Trust.
B. The foregoing notwithstanding, the Trustees then acting
(including the case where only one Trustee is then serving), acting jointly (or
singly in the case of only one Trustee then acting), shall have the right, during the
lifetime of the Grantor, to delete or add beneficiaries under this Article Third by an
acknowledged instrument delivered to the Grantor, provided that neither the
Grantor, nor any Trustee then acting, nor any member of the family, the estate, the
creditors or the creditors of the estate of the Grantor or any such Trustee may be
added as a beneficiary under this Trust.
C. The Trustees shall not be accountable to any Court or any
person regarding the exercise or nonexercise of this completely discretionary
authority. Any income not distributed may be added to principal.
D. Unless terminated by the Trustees at an earlier date, this Trust
shall terminate twenty-one years after the death of the last beneficiary of this Trust,
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and any undistributed income will be distributed to any of the then surviving
beneficiaries of this Trust as the Trustees shall determine, and thereafter the then
remaining principal shall be paid to The J. Epstein Virgin Islands Foundation, Inc.,
a non-profit corporation, organized under the laws of the United States Virgin
Islands.
E. The Trust created pursuant to this Trust Agreement may be
referred to as "THE 2013 BUTTERFLY TRUST."
FOURTH
Governing Law: Claims or Charges Against Grantor or his Estate
A. This Trust Agreement and the trust created by it shall in all
respects and for all purposes be governed and regulated by the laws of the
Territory of the U.S. Virgin Islands as they now exist and may from time to time
be enacted, amended, or repealed. All questions regarding the validity,
construction, and administration of this trust instrument, or any of its provisions,
arid of this trust shall be determined solely by the laws of that territory. The courts
of the State of Delaware and the U.S. Virgin Islands shall have primary supervision
over the administration of the trust. It is intended that this trust shall be a U.S.
domestic trust as defined in Title 26 section 7701(a)(30) of the Code by virtue of
meeting the court and control test. As provided in Treas. Reg. section 301.7701-
7(c)(4XD), if both a United States court and a foreign court are able to exercise
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primary supervision over the administration of the trust, the trust meets the court
test.
B. No portion of the income or principal of the Trust shall be
liable for the payment of any taxes, liabilities, debts or any other claims or charges
against the Grantor or the estate of the Grantor.
FIFTH
Trustees
A. Each of the Trustees, acting singly, is authorized to designate
one or more additional or successor Trustees of the Trust.
B. Designations shall be in writing and may be revoked in writing
by the maker thereof, at any time prior to the qualification of the Trustee so
designated.
C. Any Trustee may resign by giving notice to take effect on the
date specified in said notice, except that if the resigning Trustee is the last acting
Trustee, and no successor designated pursuant to the provisions of this Article is
available to succeed him or her, then his or her resignation shall not be effective
until he or she designates a successor and such successor qualifies to act.
D. A Trustee may resign or qualify only by a written instrument
mailed or delivered to a Trustee then acting, or if none, to his or her successor, in
the case of a resignation, or in any case to the Grantor.
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E. No Trustee at any time acting hereunder shall be required to
give any bond, undertaking or other security for the faithful performance of his or
her duties in any jurisdiction.
F. The Grantor shall have the power at any time and from time to
time to remove any Trustee of the Trust by a written instrument, duly
acknowledged by the Grantor, mailed or delivered to at least one of the Trustees
then acting, and such removal shall be effective on the date specified in such
written instrument, or if no date is specified, on the date of such mailing or
delivery.
G. Anything contained in the foregoing provisions
notwithstanding, neither the Grantor nor any person who is a person described in
Section 672(c) of the Code, in relation to the Grantor, shall be appointed as a
Trustee of the Trust.
SIXTH
Settlement of Trustees' Accounts; Exoneration of Trustees
A. The Trustees shall not be required to file or render, and the
Grantor waives and excuses the filing with or rendering to any Court of, an account
of their transactions with respect to the Trust or of inventories, accounts,
statements or reports of principal and/or income in respect of the Trust. As such,
pursuant to Section 1212, Title 15 of the Virgin Islands Code, Grantor hereby
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relieves Trustee and any Successor Trustee of the requirements imposed by
Sections 1191 and 1192 of the Virgin Islands Code. Nevertheless, the Trustees
may at any time and from time to time render an account of their transactions with
respect to the Trust. The Grantor shall have full power to settle fmally any such
account or to waive the same, and on the basis of such account or waiver, to
release the Trustees, individually, and as Trustees, from all accountability, liability
and responsibility for their acts or omissions as Trustees. Any such settlement and
release or waiver and release shall be binding upon all persons, whether or not then
in being, then or thereafter interested in either the income or the principal of the
Trust and shall have the force and effect of a final decree, judgment or order of a
court of competent jurisdiction rendered in an appropriate action or proceeding for
the judicial settlement of such an account in which action or proceeding
jurisdiction was obtained over all necessary and proper parties. The expenses of
any such accounting shall be a proper administration expense of the Trust payable
from principal or income of the Trust, or partly from each, as the Trustees, in their
discretion, shall determine. The foregoing provision, however, shall not preclude
the Trustees from having their accounts judicially settled, if they shall so desire,
and the expenses of a judicial accounting shall be a proper administration expense
of the Trust payable from principal.
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B. If any Trustee shall resign as a Trustee hereunder, the
continuing Trustee or Trustees may deliver to the Trustee so resigning, an
instrument whereby such resigning Trustee shall be released and discharged, to the
extent stated therein, of and from any and all accountability, liability and
responsibility for acts or omissions as Trustee. Any such release and discharge
shall be binding upon all persons, whether or not then in being, then or thereafter
interested in either the income or the principal of the Trust and shall have the force
and effect of a final decree, judgment or order of a court of competent jurisdiction
rendered in an appropriate action or proceeding for the judicial settlement of the
account of such Trustee, in which action or proceeding jurisdiction was obtained
over all necessary and proper parties. The foregoing provision, however, shall not
preclude any Trustee so resigning from having his, her or its account judicially
settled. The expenses of any judicial accounting rendered by a Trustee who shall
resign shall be a proper administration expense of the Trust payable from principal.
C. In addition to the foregoing, the Trustees are hereby authorized,
at any time and from time to time, with respect to the Trust, to settle the accounts
of the Trustees by agreement between or among the Trustees and the then adult
beneficiary of the income and the beneficiary or beneficiaries who would be
entitled to the principal in case the Trust was to terminate at the time of such
agreement, excluding any who are then incompetent, which agreement shall bind
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all persons, whether or not then in being, then or thereafter interested in either the
income or the principal of the Trust. Any such settlement shall have the force and
effect of a final decree, judgment or order of a court of competent jurisdiction
rendered in an appropriate action or proceeding for the judicial settlement of such
account, in which action or proceeding jurisdiction was obtained over all necessary
and proper parties. The expenses of any such account shall be a proper
administration expense of the Trust payable from principal or income of the Trust,
or partly from each, as the Trustees, in their discretion, shall determine.
D. No Trustee shall be accountable, liable or responsible for any
act, default, negligence or omission of any other Trustee.
E. No Trustee acting hereunder shall be liable for any loss or
damage which may occur hereunder, unless due to willful default, deliberate
wrongdoing or willful violation of an express provision hereof.
SEVENTH
Administrative Powers
A. In addition to and in amplification of the powers given by law
to trustees, each Trustee, acting singly, but solely in his or her fiduciary capacity, is
hereby authorized and empowered, in his or her discretion:
1. To hold any part or all of the assets of the Trust invested
in the same form of property in which the same shall be invested when received by
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the Trustees, and invest and reinvest the assets of the Trust, or any portion thereof,
in any form of investment which the Trustees may determine.
2. To acquire, buy, sell, contract to buy, contract to sell, sell
short, buy on margin, exchange, engage in risk arbitrage transactions with respect
to, and trade in stocks (common or preferred), bonds, notes., obligations (secured
or unsecured), securities of open-end and closed-end investment companies and
common trust funds, other securities (issued or to be issued), commodities, futures,
options, executory contracts for the purchase or sale of securities and commodities,
mortgages, and other property, real or personal, of any kind, whether similar or
dissimilar to that specifically enumerated above, and interests in any of the
foregoing, without being bound by any provision of law restricting investments by
trustees, and without regard to any principles of diversification.
3. To purchase, sell or exercise conversion, subscription and
other rights, and warrants, puts, calls, straddles, and other options, to make
payments in connection therewith and to sell naked options, whether calls or puts,
and to deal in other financial instruments.
4. To make any authorized transaction for cash or on credit
or partly for cash and partly on credit, with or without security, or partly or wholly
with borrowed funds.
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5. To invest in and to become a member of, any partnership,
limited liability company or joint venture, to comply with all the terms and
provisions of every partnership, limited liability company and joint venture relating
to any investment at any time held by them, and to vote, execute consents, exercise
all rights and take such other action with respect to any partnership, limited
liability company or joint venture as they, in their discretion, deem advisable.
6. To lease, for such periods (whether or not any such
period shall extend beyond the period prescribed by law or the probable term of the
Trust), on such terms and conditions and at such time or times as the Trustees shall
determine, the whole or any portion or portions of any property, real or personal,
which may at any time form part of the Trust, whether the same be held in
severalty or as tenant-in common with others or in a partnership, syndicate or joint
venture or otherwise, and release and convey any undivided interest in any such
property for the purpose of effecting partition of the whole or any part thereof, to
make, place, extend or renew mortgages, pledges, building loan agreements or
building loan mortgages upon or affecting any and all such property; and make,
execute and deliver such mortgages, pledges and agreements, together with proper
bonds, notes or other instruments of indebtedness to accompany the same, and
such extension or renewal agreements, as the Trustees shall deem best; to repair,
alter, reconstruct, build upon or improve any such property and on such terms and
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at such time or times as the Trustees shall determine, give and grant to others the
right so to do, or agree in, or so modify any lease affecting any such property that
the lessee may alter, repair, reconstruct, build upon, improve, mortgage and pledge
any such property; and generally to make, alter and modify all agreements, leases,
mortgages, pledges, building loans, sales, exchanges, transfers and conveyances of
or affecting any such property which the Trustees shall determine to be necessary,
advisable or proper for the preservation, improvement, enhancement in value of, or
betterment of or addition to, such property.
7. To vote, in person or by proxy, all stocks and other
securities held by the Trust; to grant, exercise or sell rights to subscribe to stock
and securities and options of any nature; to amortize or refrain from amortizing
premiums on bonds or other securities which the Trustees may purchase or receive;
to participate in reorganizations, mergers, liquidations or dissolutions, and
contribute to the expense of, and deposit securities with protective committees in
connection therewith; to participate in voting trusts; and generally exercise, in
respect of said stock and securities, all rights, powers and privileges which may be
lawfully exercised by any person owning similar property in his own right.
8. To employ any investment counsel, corporate custodians,
agents, accountants, brokers and attorneys which the Trustees may select and pay
the charges thereof, and the Trustees, or a partnership, corporation or other entity
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in which any Trustee shall be interested, or by which any Trustee may be
employed, may be retained in any such capacity, and, in such event, the charges
which shall be payable to such Trustee, or to any such partnership, corporation or
other entity, shall be in addition to commissions or compensation otherwise
allowable to such Trustee and may be paid without prior judicial approval.
9. In any case in which the Trustees are authorized or
required to pay or distribute any share of the Trust, to make such payment or
distribution in kind, or in cash or partly in each and, in connection therewith, to
allocate equal or unequal interests in, or amounts of, specific property in
satisfaction of such payment or distribution.
10. To settle, adjust, compromise or submit to arbitration any
dispute, claim or controversy in which the Trust may be in any way interested.
11. To borrow money from any person, partnership,
corporation or other entity, for the purpose of meeting any and all charges against
the Trust or for any other purpose connected with the administration, preservation,
improvement or enhancement in value of the Trust, and, in connection with any
such borrowing, to pledge, hypothecate or mortgage any part or all of the assets of
the Trust.
12. To keep any or all of the securities at any time forming a
part of the Trust in the name of one or more nominees.
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13. In any case where doubt or uncertainty exists under
applicable law or this Trust Agreement, to (i) credit receipts to principal or income,
or partly to each and (ii) charge expenses against principal or income, or partly
against each.
14. By instrument or instruments signed by all of the
Trustees qualified and acting as such at any time, to delegate, in whole or in part,
to any person or persons (including any one or more of the Trustees) the authority
and power to (i) sign checks, drafts or orders for the payment or withdrawal of
funds from any account in which funds of the Trust hereunder shall be deposited,
(ii) endorse for sale, transfer or delivery, or sell, transfer or deliver, or purchase or
otherwise acquire, any and all stocks, stock warrants, stock rights, bonds or other
securities whatsoever, and (iii) gain access to any safe deposit box which may be in
the names of the Trustees and remove part or all of the contents of any such safe
deposit box and release and surrender the same.
15. To remove the assets of the Trust to, or hold and
administer any such assets in, such location or locations within or without the
United States Virgin Islands as any Trustee, in his or her discretion, shall select.
16. To make, or retain from making, elections permitted
under any applicable tax law, without regard to the effect of any such election on
the interest of any beneficiary of the Trust and, if any such election shall be made,
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to apportion, or refrain from apportioning, any benefits thereof among the
respective interests of the beneficiaries of the Trust, all in such manner as any
Trustee shall deem appropriate.
17. To exercise all authority, powers, privileges and
discretion, conferred in this Article after the termination of the Trust created under
this Trust Agreement and until all of the assets of the Trust are fully distributed.
B. No person or party dealing with any of the Trustees shall be
bound to see to the application of any money or other consideration paid by them
to any of the Trustees.
C. Neither the principal nor the income of the Trust or any part
thereof, shall or may at any time be liable or subject in any matter whatsoever to
the debts or liabilities of any beneficiary entitled to receive any principal or income
therefrom, nor shall the principal or income of the Trust be liable to attachment by
garnishment proceedings or other legal process issued by any creditor of any
beneficiary of the Trust for debts heretofore or hereafter contracted by such
beneficiary; nor shall any assignment, conveyance, charge, encumbrance or order,
either of principal or income, given by any such beneficiary be valid.
EIGHTH
IRREVOCABILITY, SEVERABILTY, COUNTERPARTS
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A. This Trust Agreement and the Trust created hereunder are
irrevocable. Neither the Grantor nor any other person shall have the right to alter,
amend, revoke or terminate this Trust Agreement or the Trust created hereunder.
B. Should any part, clause, provision or condition of this Trust
Agreement be held to be void or invalid, then such voidance or invalidity shall not
affect any other part, clause, provision or condition hereof, but the remainder of
this Trust Agreement shalt be effective as though such void or invalid part, clause,
provision or condition had not been contained herein.
C. This Trust Agreement may be executed in counterparts, each of
which shall be an original, but together which shall constitute one instrument.
GRANTOR TRUST PROVISIONS
A. At any time during the life of the Grantor, the Trustees then
serving, shall have the sole power to loan the principal or income of any trust
established hereunder to the Grantor, without security, pursuant to Section 675(2)
of the Code, as amended from time to time (such power "Lending Power"). Any
loan to the Grantor pursuant to this clause A of this Article NINTH must bear
interest equal to or greater than the applicable federal rate, as defined in Section
1274(d) of the Code, as amended from time to time. At any time the Trustees shall
have the right to irrevocably waive and release the Lending Power granted to him
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or her pursuant to this clause A of this Article NINTH by delivering a written
instrument, executed by the Trustees and acknowledged in the same manner as is
then required to record deeds of real estate in the United States Virgin Islands, to
the Grantor. Upon the death of the Grantor, this Lending Power shall terminate and
no Trustee then serving or who shall thereafter be appointed by any other person
(or court) to serve in such office shall be vested with this Lending Power.
B. Notwithstanding anything contained herein to the contrary, the
Grantor shall have the right, at any time or times exercisable in a non-fiduciary
capacity, without the approval or consent of any person acting in a fiduciary
capacity, to reacquire any part of all of the trust principal by substituting other
property of an equivalent value determined as of the date of substitution, pursuant
to Section 675(4XC) of the Code. This right shall be exercised by delivery to the
Trustees of a written notice of substitution, signed by the Grantor identifying with
specificity each trust asset being reacquired and each item of property substituting
therefor, and the Grantor shall certify in writing to the Trustees that any substituted
property is of equivalent value to the property previously held in the trust for
which it is substituted. The Trustees shall independently verify such determination
of value and any dispute regarding such determination of value may be resolved in
an appropriate judicial form. This right may be relinquished at any time by
delivery of a written notice of relinquishment, signed by the Grantor, to the
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Trustees, effective at such time as is stated in the notice of relinquishment or, if no
such time is so stated, upon such delivery.
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IN WITNESS WHEREOF, the Grantor and the Trustees have
executed this Trust Agreement on the day and year first above written.
Je'f'frey E. Epsteir, Grantor, /
Erika A. Kellerhals,•)Trustee
RiChard Kahn, Trustee
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SATATa.- 6-4..) ,-forttic
)ss.:
Cc.) t) (14/17'1" OF etO ‘clor?-k.
On the -31 day of tie ca - in the year 2013, before me, the
undersigned, personally appeared JEFFREY E. EPSTEIN, personally known to me
or proved to me on the basis of satisfactory evidence to be the individual whose
name is subscribed to the within instrument, who acknowledged to me that he
executed the same in his individual capacity, and that by his signature on the
instrument, the individual or the person upon behalf of which the individual acted,
executed the instrument.
*N7
Notary PUblic
TERRITORY OF THE VIRGIN ISLANDS )
)ss.:
DIVISION OF ST. THOMAS & ST. JOHN )
On the day of '',17>c ittreY in the year 2013, before me, the
undersigned, personally appeared ERIKA A. KELLERHALS, personally known to
me or proved to me on the basis of satisfactory evidence to be the individual whose
name is subscribed to the within instrument, who acknowledged to me that she
executed the same in her individual capacity, and that by her signature on the
instrument, the individual or the person upon behalf of which the individual acted,
executed the instrument.
.,1(lotary Publid
et/awry Ferguson
NOTARY PUBLIC LAW 012-10
Gortirnission Expires 05/02/2914
Territory of the U.S.- Virgin blends
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STATE OF 0E°) Stal<
)ss.:
)
COUNTY OF is a.)
On the day of L in the year 2013, before me, the
undersigned, personally appeared RICHARD KAHN, personally known to me or
proved to me on the basis of satisfactory evidence to be the individual whose name
is subscribed to the within instrument, who acknowledged to me that he executed
the same in his individual capacity, and that by his signature on the instrument the
individual or the person upon behalf of which the individual acted, executed the
instrument.
V
Notary Public
1.:,•17:1:v I. it Ea
!f ;Pew v.,-ytc
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SCHEDULE A
$100
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