Appendix 3 – The Trust Deed

Appendix 3 – The Trust Deed

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TRUST DEED
This deed is made on ……… day of ………………………………
between Ltd (“The Company”) and The  Employee Benefit Trustee Company Ltd (“The Trustee”)

1. PURPOSE
The purpose of this Deed is to establish a trust for the <<>> Employee Benefit Trust (“the Trust”).
2. STATUS
The Plan consists of this Deed and the Share Transfer Agreement.
3. DECLARATION OF TRUST
3.1 The Company and the Trustees have agreed that all the Shares and other assets which are issued to or transferred to the Trustees are to be held on the trusts declared by this Deed. When Shares or assets are transferred to the Trustees by the Company with the intention of being held as part of the Plan they shall be held upon the trusts and provisions of this Deed.
3.2 The Trustees shall hold the Trust Fund upon the following trusts namely, as to Shares which have been awarded to a Participant (“Employee Ordinary Shares”), upon trust for the benefit of that Participant on the terms and conditions set out in this Deed.
3.3 The perpetuity period in respect of the trusts and powers declared by this Deed and the Rules shall be the period of 80 years from the date of this Deed.
4. NUMBER OF TRUSTEES
Unless a corporate Trustee is appointed, there shall always be at least 2 Trustees. Where there is no corporate Trustee, and the number of Trustees falls below 2, the continuing Trustee has the power to act only to achieve the appointment of a new Trustee.
5. INFORMATION
The Trustees shall be entitled to rely on information supplied by the Company in respect of the eligibility of any person to become or remain a Participant in the Plan.
6. CHANGE OF TRUSTEES
The holders of Employee Ordinary Shares in the Company have the power to appoint or remove any Trustee for any reason on a simple majority of Employee Ordinary Shares in issue, on a one-share-one-vote basis. The change of Trustee shall be effected by executing a deed. Any Trustee may resign on one month’s notice given in writing to the Company, provided that there will be at least two Trustees or a corporate Trustee immediately after the retirement.
7. INVESTMENT AND DEALING WITH TRUST ASSETS
7.1 Save as otherwise provided for by the Plan the Trustees shall not sell or otherwise dispose of Plan Shares.
7.2 The Trustees shall obey any directions given by a Participant in accordance with the Participant’s Share Purchase Agreement in relation to his Plan Shares and any rights and income relating to those Shares. In the absence of any such direction, or provision by the Plan, the Trustees shall take no action.
7.3 The Trustees shall not be under any liability to the Participating Company or Companies or to current or former Qualifying Employees by reason of any act or failure to act.
7.4 The Trustees may delegate powers, duties or discretions to any persons and on any terms. No delegation made under this clause shall divest the Trustees of their responsibilities under this Deed.
The Trustees may allow any Shares to be registered in the name of an appointed nominee provided that such Shares shall be registered in a designated account. Such 4 registration shall not divest the Trustees of their responsibilities under this Deed or the Schedule.
The Trustees may at any time revoke any delegation made under this clause or require any Plan assets held by another person to be returned to the Trustees, or both.
7.5 The trustee or trustees of the Employee Trust will manage Employee Shares on behalf of, and in the best interests of, all of their beneficial owners.
7.6 The trustee or trustees of the Trust will manage Employee Shares on behalf of, and in the best interests of, all of their beneficial owners. The trustee’s, or trustees’, powers shall be exercised equally and proportionately as between all Employee Shares regardless of the holder, and shall include the power to surrender Employee Shares with or without consideration.
9. LOANS TO TRUSTEES
The Trustees shall have the power to borrow money for the purpose of:
(a) acquiring Shares; and
(b) paying any other expenses properly incurred by the Trustees in administering the Plan.
9. TRUSTEES’ OBLIGATIONS UNDER THE PLAN
Notice of Award of Free and Matching Shares
9.1 As soon as practicable after Shares have been issued to the Trust, the Trustees shall give the Participant a notice stating:
(a) the number and description of those Shares;
(b) the amount of money applied by the Trustees in acquiring those shares on behalf of the Participant; and
(c) their Initial Market Value on the date of Award.
Income received in respect of the Shares
9.2 The Company will periodically (at the end of each financial year, quarter, or month) pay dividends to Participators in respect of the Shares held on behalf of the Participators, according to the Profit of the Company and the Memorandum and Articles. Such dividends, and other income payable in respect of the Shares, will be payable (and will be paid) by the Company directly to Participators, and not to the Trust, and Participators shall alone be entitled to receive them, or to take legal action to recover them in the event of their non-payment.
General offers etc.
9.3 The Trustees may make any offer, compromise, arrangement or scheme which affects the Plan Shares, and will notify Participants of it. Participants may collectively direct how the Trustees shall act in relation to any offer, compromise, arrangement or scheme is made which affects all the Plan Shares equally, on a one-share-one-vote basis. Each Participant may direct how the Trustees shall act in relation to any offer, compromise, arrangement or scheme is made which affects only that individual’s Plan Shares.
10. POWER OF TRUSTEES TO RAISE FUNDS TO SUBSCRIBE FOR A RIGHTS ISSUE
If instructed by Participants in respect of their Plan Shares the Trustees may dispose of some of the rights under a rights issue arising from those Shares to obtain enough funds to exercise the remaining rights.
The rights referred to are the rights to buy additional shares or rights in the same company.
11. POWER TO AGREE MARKET VALUE OF SHARES
Where the Market Value of Shares falls to be determined for the purposes of the Plan, the Trustees may agree with the Inland Revenue that it shall be determined by reference to such date or dates, or to an average of the values on a number of dates.
12. PERSONAL INTEREST OF TRUSTEES
Trustees, and directors, officers or employees of a corporate Trustee, shall not be liable to account for any benefit accruing to them by virtue of their:
(a) participation in the Plan as an Employee;
(b) ownership, in a beneficial or fiduciary capacity, of any shares or other securities in any Participating Company;
(c) being a director or employee of any Participating Company,
being a creditor, or being in any other contractual relationship with any such Company.
13. TRUSTEES’ MEETINGS
The Trustees shall hold meetings as often as is necessary for the administration of the Plan. There shall be at least two Trustees present at a meeting except where the sole Trustee is a corporate Trustee and the Trustees shall give due notice to all the Trustees of such a meeting. Decisions made at such a meeting by a majority of the Trustees present shall be binding on all the Trustees. A written resolution signed by all the Trustees shall have the same effect as a resolution passed at a meeting.
14. SUBSIDIARY COMPANIES
Any Subsidiary may with the agreement of the Company become a party to this Deed and the Plan by executing a deed of adherence agreeing to be bound by the Deed and Rules.
Any company which ceases to be a Subsidiary shall cease to be a Participating Company.
15. EXPENSES OF PLAN
The Participating Companies shall meet the costs of the preparation and administration of this Plan.
16. TRUSTEES’ LIABILITY AND INDEMNITY
16.1 The Participating Companies shall jointly and severally indemnify each of the Trustees (except a remunerated Trustee) against any expenses and liabilities which are incurred through acting as a Trustee of the Plan and which cannot be recovered from the Trust Fund. This does not apply to expenses and liabilities which are incurred through fraud or wilful wrongdoing or are covered by insurance under clause 18.3.
16. 2 No Trustee except a remunerated Trustee shall be personally liable for any breach of trust (other than through fraud or wilful wrongdoing) over and above the extent to which the Trustee is indemnified by the Participating Companies in accordance with clause 18.1 above.
16.3 A Trustee may insure the Plan against any loss caused by him or any of his employees, officers, agents or delegates. A Trustee may also insure himself and any of these persons against liability for breach of trust not involving fraud or wilful wrongdoing or negligence of the Trustee or the person concerned.
16.4 A Trustee who carries on a profession or business may charge for services rendered on a basis agreed with the Company. A firm or company in which a Trustee is interested or by which he is employed may also charge for services rendered on this basis.
17. COVENANT BY THE PARTICIPATING COMPANIES
The Participating Companies hereby jointly and severally covenant with the Trustees that they shall pay to the Trustees all sums which they are required to pay under the Rules and shall at all times comply with the Rules.
18. ACCEPTANCE OF GIFTS
The Trustees may accept gifts of Shares and other assets which shall be held upon the trusts declared by clause 3.
19. TRUSTEES’ LIEN
The Trustees shall not be entitled to resort to Plan Shares for the satisfaction of their liabilities except to the extent that this is permitted by the Plan.
20. AMENDMENTS TO THE PLAN
The Company may, with the Trustees’ written consent, from time to time amend the Plan provided that no amendment which would adversely prejudice to a material extent the rights attaching to any Plan Shares awarded to or acquired by Participants may be made nor may any alteration be made.
21. TERMINATION OF THE PLAN
21.2 The Plan shall terminate on the expiry of the Trust Period.
21.2 Any Shares or other assets which remain undisposed of on termination, after Participators have received the full entitlement to shares due to them, shall be held by the Trustees upon trust to pay or apply them to or for the benefit of the Participating Companies as at the termination date in such proportion, having regard to their respective contributions, as the Trustees shall in their absolute discretion think appropriate.

SIGNED on behalf of <<>> Ltd by:
……………………………….………, Director (Signature)

……………………………….………, Director (Signature)

And on behalf of The <<>> Employee Benefit Trustee Company Ltd (“The Trustee”) by:
……………………………….………, Director (Signature)

……………………………….………, Director (Signature)