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Ord 0494-AMENDING ORDINANCE NO. 451ORDINANCE NO. 494 AN ORDINANCE Ai"LENDING ORDINANCE NO. 451 OF THE TOWN OF LOS GATOS, ENTITLED, 11 AN ORDINANCE CREATING A PENSION PLAN FOR TOWN 'EMPLOYE]E".. THE TOWN COUNCIL OF THE TOWN OF LOS GATOS DOES ORDAIN AS FOLLOWS: that Ordinance No. 451 of the Town of Los Gatos, entitled "An Ordinance Creating A Pension Plan For Town Employees", passed and adopted by the Town Council of the Town of Los Gatos on December 2, 1957, be and the same is, hereby amended to read as follows: SECTION 1. PENSION PLAN CREATED. A Pension plan, to be known as the "Los Gatos Town Employees Pension Plan", is hereby created and established. SECTION 2. PURPOSE. The purpose of this ordinance is to establish a pension plan and provide related benefits for certain employees of the Town of Los Gatos. SECTION 3. DEFINITIONS. The following words and phrases as used hereinafter, unless a different meaning is plainly required by the context, shall have the following meanings (a) "Pension Plan" or "Plan" shall mean the Los Gatos Town Employees, Pension Plan created herein. (b) "Employee" shall mean any person, including any person generally classed as an "officer" or "official", in the employ of the Town whose compensation for such employment is wholly paid by the said Town and who is regularly employed by the Town on a full-time basis; but does not include those persons holding: elective offices or those persons employed temporarily, or those persons employed on less than a full-time basis. (c) "Member" shall mean any employee included in the membership of the Pension Plan in accordance with the pro- visions of Section 5 of this Ordinance. -1- (d) "Town" shall mean Town of Los Gatos. (e) "Board" shall mean the "Pension Board{' created by this Ordinance. (f) "Service" shall mean employment of an employee by the Town on a full-time basis, (g) "Pension Effective Date" shall mean January.l, 1958• (h) "Entry Date" shall mean the first of January, 1958, and the first day of January in every year after 1958. (1) "Anniversary Date" shall mean any anniversary of the Dension effective date or of any entry date on which the member, as to whom the term is applied, became a member. (j) "Past Service" shall mean all continuous full-time service prior to the pension effective date. For the purpose of computing past service, periods of such service of less than six (6) calendar months shall be disregarded, and periods of such service of six (6) calendar months or more in any one year shall be considered a year of past service. (k) "Current Service" shall mean all continuous full- time service after the pension effective date. (1) "Age" means the age of a person on his nearest birthday. (m) "Normal Retirement Date" shall mean., when applied to any member who becomes a member as of or after the pension effective date, the first date of the month coincid.entwith or next following his 65th birthday. With the approval of the Council, a member may remain in service after his normal retirement date as defined herein; but if he does so, (i) no contributions shall be made to the plan by the Town after such employee's normal retire- meat date; (ii) no contribution will be made by the employee to the plan unless such employee voluntarily erects, by written notification to the Board, to continue his contributions to the plan after such employee's normal retirement date; and (III) the payment of benefits hereunder shall be deferred until his actual retirement from service. -2 (n) "Early Retirement Date" shall mean the first day of any month, after the pension effective date, but not more than ten (10) calendar years prior to the normal retirement date of the member to whom the term is applied, on which any member, after twenty (20) years or more of service, and at least five (5) years of current service participation in this Plan, shall elect to retire from service. (o) "Miliaary Leave" shall be the leave of absence status of a permanent employee or probationer who leaves a position to serve in the armed forces of the United States in time of national emergency or State military emergency or who is drafted under the National Conscription Act of the United States of America, and who has the right under statutes relating to reinstatement of persons after military service to return to his position. (p) "Leave of Absence" shall be a leave of absence of an employee or probationer duly granted by the.Town Council in accor- dance with Section 4 of the Personnel System Rules and Regulations of the Town of Los Gatos. (q) "Pensioner" shall mean a member, or former member, entitled to a pension under the provisions of Section 10 or Section 12 hereof. (r) "Beneficiary" shall mean any person designated by a member as one entitled to receive benefits which may be payable on or after the death of such member. Wherever the rights of the members are stated or limited by the provisions hereof, their beneficiaries shall be bound by such statement or limitation. (s) "Insurance Contract" shall mean any form of annuity contract issued by a life insurance company, including, but not by way of limitation, a group annuity contractor a group annuity deposit administration contract. (t) "Insurance Company" shall mean any life insurance company which, upon application by the Town Council, in accordance withe the provisions of Section S hereof, has issued one or more insurance contracts. -3- (u) "Council" shall mean the Town Council of the Town of Los Gatos. (v) "Trust Instrument" or "Trust Agreement" shall mean that trust instrument made and executed pursuant to this Ordinance between the Town and a corporate bank or trust company under which the contributions of the members to the Plan shall be held in trust for such member or his beneficiary. (w) "Trustee" shall mean the corporate bank or trust company who is the trustee under the trust instrument and any successor trustee thereunder. (x) "Fund" or "Trust Fund" shall mean all contributions of members made under the Plan delivered to the trustee pursuant to the trust instrument and any and all income, profit or other property produced or otherwise acquired therefrom'. (y) Wherever appropriate, words used herein in the singular,, may include the prural, or the prural may be read as the singular, and the masculine may include the feminine. SECTION 4. PENSION BOARD CREATED (a) The Pension Board shall consist of five members. Two members of said Pension Board shall be elected by the participating employees of the Town of Los Gatos by a vote of the majority of said employees present at a, meeting of said employees called by the Town Manager for the purpose of such election, at which meeting the said vote shall betaken by a secret written ballot. The remaining three members of said `Pension Board shall be appointed by the Los Gatos, Town Council. (b)' The terms that the members of said Board shall serve shall be as follows: (i) As soon as practicable after the effective date of this ordinance, the Town Manager shall call a meeting of the participating employees for the purpose of electing the members of the Board to be elected by the -4- (i) employees, one of which members shall be elected for a term of one year and one for a term of two years. At the expiration of each term so provided, the Town Manager shall call a ,meeting of said participating employees, anal, at such meeting,the said employees shall elect a member to serve for a .period of two years and until his successor shall have been elected. Removal of employee elected Board members prior to the expiration of their respective terms shall be made only after a two-thirds vote by secret ballot of the participating employees at a meeting of said employees duly called for such purpose by thp- own Manager. Ixn the event of removal, employees shall elect a successor by secret ballot at said meeting to serve the. balance of the unexpired term. (it) As soon As practicable after the effective date of this ordinance, the Town Council shall appoint three members of the Pension Board, one such appointment being for a term of one year, one for a ter it of two years, and one for a term of three years. At the expiration of each such term the Town Council shall appoint a successor to serve for a term of three years. Each member shall serve until his successor is appointed and qualified. A.major.ity vote of the Council shall be required to appoint a member of the Pension Board, but a four-fifths vote shall be necessary. to remove from office prior to the expiration: of his term any member of the Pension Board appoint- ed under this section. _5_ (iii) Members of the Pension Board shall be residents of this Town.. No person shall be appointed to the Board by the Council who holds any salaried public office or employment with the Town of Los Gatos, nor shall any such member while on the Board or for a period of one year after his term has expired, be eligible for appointment, in the competitive service of the Town of Los Gatos. (iv) Any member of the-Board.may be elected or appointed to succeed himself. (v) Any vacancy on the Board shall be filled by election or appointment as hereinbefore pro- vided, and the person so elected or appointed shall serve until the next regular election or appointment of members of the Board. (e) No remuneration shall be paid to any member of the Board for services performed as such; but any necessary costs, expenses or disbursements shall be paid by the Town, in addition to its contributions provided for in Section 7 of this ordinance. (d) The Board shall elect its own: Chairmen. The Clerk of the' Board, waio shall be the Town Clerk of the Town of Los Gatos, shall keep regular minutes of all meetings held by the Board. The Board shall hold regular quarterly meetings in the Town Council Chambers at a time to be selected by the Board Special meetings may be called as required in accordance with Section 54956 of the Government Code of the State of California. `our members shall constitute a quorum for the transaction of business. (e) The management, control and operation of the Pension Plan shall be vested in the Board, and the Board shall exercise the powers and perform the duties conferred on it by this ordinance, subject to the limitations imposed by this ordinance and.. the trust instrument; and the said powers and duties shall include , but not be confined to, the following: -6- required to maintain, or have maintained, any records which would duplicate records kept by any department or official of the Town Government, by any insurance company, or by the trustee or any delegate of the trustee. (iii) The Board shall report annually to the Council as to its administration of the Pension Plan, which said report shall include statements of the total contributions made to the date of said report by members and by the Town and the benefits to which members and their beneficiaries have or will be- come entitled under the provisions of this ordinance. (i) The Board shall prepare, or have prepared for adoption by the Town Council a set of rules and regulations governing the conduct of, the Board and the administration of the Pension system. (ii) In addition to any other records and accounts, it shall deem necessary, the Board shall have the Clerk of the Board maintain or have man- twined such records and accounts as shall be necessary at any time to establish the total accumulated contributions of each member, to show the total benefits paid to each_pensoner and each beneficiary entitled thereto, and to show the benefits to which members and their designated beneficiaries shall be entitled under the provisions thereof, provided, however, that neither the Town Clerk nor the Board shall be (iv) The Board shall recommend to the Council and the Council shall determine whether any employee is a temporary employee or an employee employed on less than a full-time basis, or other person not -7- (iv) entitled according to the provisions of this ordinance to become a member. (v) The Board shall have authority to determine the amount and kind of benefit to which each member, pensioner, and beneficiary is entitled under the provisions of this ordinance and to determine the compensation and length of service of all members for the purposes of this ordinance; and (vi) If, within sixty (60) days after the pension effective date, at least seventy-five (755%) per cent of the employees qualified to become members as of such date have not elected to become members, the Board shall have the right to postpone the effective date of the Plan until such time as seventy-five (75%) per cent of such employees do so elect; and, in such•-case, the Board shall have the right to prescribe a pension effective date, entry dates and normal retire- ment dates for all employees; or in its discretion, to postpone the operation of the Plan indefinitely and to request the Council to repay all employees any amounts withheld from their compensation as contributions under Section 6 of. this ordinance. (vii) The Board shall make its financial records avail- able for periodic audit by the Town Auditor at such time as other Town records are audited, or as required by the Council SECTION 5 MEMBERSHIP IN PLAN. (a) Every employee in service on the pension effective date, who has not attained age 65, and who is a member or one of the employee groups set forth in Section 45305 of the Government Code of the State of California, provided the group of which the employee is a, member has approved the retirement proposal as provided for in -8- (a) Section 4 5303 of said. Government Code, shall become a member as of the pension effective date. Every employee employed by the Town after the pension effective date, which employee is in a participating em- ployee group, shall be required, as a.condition of employment to be- come a member on the entry date after he has completed one (1) full year of continuous service, provided that, on such entry date, he has not attained age 60; and every such employee shall be required, at the time of his employment, to sign such application for membership as the Board may require. (b) Every employee qualified to become a member as of the pension effective date shall become a member by ,filing with the Board, his written application for membership in such form as the Board may require, on or before the said pension effective date. SECTION 6. EMPLOYEE CONTRIBUTIONS (a) Each qualified employee who elects to be a member shall agree, in his application for membership, as follows; That, commencing with the date upon which he becomes: a, member, and con- tinuing until his normal or early retirement date, an amount equal to four (4%) per cent of his compensation, before any deductions, as the same may become payable, shall not be paid to him by the Town, provided, however: (i) That such amount so withheld shall represent the contribution of the member to the trust fund. (ii) That by making such deductions, the Town shall reimburse itself to that extent for advances made by it for the account of the member; and (iii) That, upon termination of employment, such member shall repay to the Town any such advances for which the Town may not have been reimbursed. Notwithstanding any provisions of Section 10 hereof, no terminated employee, nor any bene- ficiary, shall be entitled to any sum whatsoever until the Town shall have been reimbursed for -9- any such advances made on behalf of such employee. (b) Each member shall be deemed to consent, and agree, to his contribution as made and provided for herein, and shall receipt in full for his salary, compensation, or wages. Payment of such salary, wage or compensation, less said contribution, shall be a full and complete,discharge of all claims and demands whatsoever for the services rendered by such member during the period covered by such payment, except his claim to any benefits to which he may be entitled under the provisions of this ordinance, (c) To provide for the investment and reinvestment of contributions of members and the payment to each member, or bene- ficiary of such member's proportionate share in the fund, the':Council shall execute with.such corporate bank or trust company as it may select, a trust instrument under which the contributions of members shall be held, administered and disbursed, which trust shall pro- vide as follows: TRUST AGREEMENT FOR TIC TOWN OF LOS GATOS PENSION PLAN This Trust Instrument is made and executed this da.y of , 1959, between the Town of Los Gatos, a municipal corporation and general law city of the State of California, hereinafter called the "Town", The Bank of California National Association, hereinafter called the "Trustee", for the benefit of the qualified employees of the Town, hereafter called "Members." STATETVIE1?T OF BASIC FACTS AND PUPPOSES. (a) The Town by its ordinance number 451, duly adopted by its Town Council on December 2, 1957, and as amended by its ordinance number duly adopted by its Town Council on ?959, created and established a Pension. Plan for its employees and dppended hereto, designated Exhibit "A", and by this -10- e (a) (Cont,a) (a) reference specifically made a part hereof, is a copy of said ordinance number 451 as amended, and which shall hereafter be referred to as the "Pension Plan" or "Plan,i. (b) This Trust is created in the United States and forms a part of the Plate which was established by the Town for the exclusive benefit of its employees or their beneficiaries. (c) This Trust is farmed for the purpose of distribut- Ing. to the employees or their. beneficiaries the corpus,and income -"-of' the Fund accumulated by the Trust in accordance with the Plan. (d) It is.intended that this Trust Instrument create a qualified Trust under the provisions of Section 40'l of the Internal Revenue Code of 1954 and under the provisions of Division 21 Part 10, Chapter 5, Article 1 (Section 17501 et seq.) of the Revenue and Taxation Code of the State of California. (e) Words and phrases used in this Trust Instrument, unless .a different meaning is plainly required by the context, shall have the same meanings as stated in. Section 3 of the Plan. AGREEMENTS AND ADMINISTRATION OF THE TRUST In consideration of the foregoing, and for good and valuable consideration the receipt of which is hereby acknowledged, the Trustee agrees that it will hold any and all sums which may from time to time be paid to it as Trustee hereunder, in Trust, for the uses and purposes and upon the 'terms and conditions herein- after stated. ARTICLE ONE 1.10 The 'Trustee shall accept contributions to the Trust made under the terms of the Plan and shall hold., manage," and ad- minister the Trust without distinction between principal and income. 1.20 Contributions delivered to the Trustee hereunder and any and all income, profits, or other property produced or otherwise acquired therefrom shall constitute the corpus of this Trust hereinafter called the "Fund" 1.30 The Fund shall be held and administered by the Trusteee for the exclusive benefit of Members and retired Members under the Plan and the beneficiaries of such Members pursuant to the provisions of the Plan. 1.4o Irrespective of any inconsistent provision contained herein or in the Plan, it shall be impossible, whether by operation or by natural termination of the Trust, by power of revocation or amendment, by the happening of any contingency, by collateral arrangement., or by any other means, at any time before the termina -t,i= of this Trust and the satisfaction of all liabilities with respect to Members or retired Members and their beneficiaries for any part of the Fund. (excepting such part as`may be required to pay taxes and administration expenses) to revert to or be recover- able by the Town or to be used for or diverted to purposes other than for the exclusive benefit of Members or retired. Members or their beneficiaries and, only then, may recovery be had by the Town to the extent of any surplus existing because of erroneous actuarial computations. 1.50 The Trustee shall be responsible only for sums actually received by it as Trustee hereunder. 1.60 The Trustee shall be under no duty, and it shall have no right.to compute any amount to be paid into the Fund pursuant to the Plan, or to collect any sums from the Town which may accrue under the Plan. 1.70 The Trustee shall not be responsible for the adequacy of this Trust to meet and discharge any and all payments and liabilities under the Plan. ARTICLE TWO 2.10 The Torn shall, advise the Trustee Jr- writing of the nA,-mes of ib~ members of the Pension Board and shall. a 7ise the Trustee in writing of all changes,-in such membership. 2.20 Directions or recommendations to, be received by the -12- 2.20 ( con.t' d ) Trustee hereunder from the Peniion Board shall be in writing and shall be signed by a majority of the then members of said Board or by such person as may from time to time be designated to transmit such directions or recommendations to the Trustee. 2.30 The Trustee may rely or act upon such written directions or recommendations from the Pension Board signed by a majority of the then members thereof, or upon receipt of a certified, copy of the minutes of such Board signed by the person so designated by the Board indicating that a majority of the then members thereof approved such direction or recommendation. 2.40 The Trustee shall from time to time on the written directions of the Pension Board given to it as herein above pro- vided make distributions from the Trust to such persons in such manner, in such amounts, and for such purposes as may be specified in such directions. 2.50 The Trustee shall incur no liability for any distribution made by it pursuant to the directions of the Board. 2.6o In making a distribution upon directions of the Pension Board the Trustee shall be under no duty to make inquiry as to whether such distribution is made pursuant to the Plan, and it may accept such directions as a certification that such distri- bution complies with the provisions of the Plan and with the provisions of Section 1.40 of this Trust instrument. 2.70 The Board shall promptly notify the Trustee in writing of all changes in such list and in the compensation of such Members. In the absence of notice of changes, the Trustee shall be entitled to assume that the list then in its possession is current. -13- ARTICLE THREE 3.10 The Trustee is hereby authorized to hold such portion of the Fund as it may deem necessary for the ordinary administration of this Trust and the disbursements of funds in cash without liability for interest by depositing the same in any Bank (including the Savings and. Commercial departments of the Trustee) subject to the rules and regulations governing such deposits and without regard to the amount of any such deposit. 3.20 The Trustee shall have full power to.invest and reinvest the Fund. of tl-,.is Trust in any invest-ments permitted b law for the investment of trust funds in the State of California, and as may be directed by the Pension Board.. 3.30 The Trustee shall have full poixer, in -respect to any and all contributions, securities or property at any time received or held as a part of the Fund of this Trust, to do all such acts, take all such proceedings and exercise all such rights and privileges, whether herein specifically referred to or not, as could be done taken or exercised by the absolute owner thereof, including, without in any way limiting or impairing the generality. of the foregoing, the following powers and authority: 3.301 To retain the same for such period of time as it deems appropriate. 3.302 To sell the same, at either public or private sale, at such time or times and on such terms and conditions as to credit or otherwise as to it may seem appropriate. 3.303 To consent to or participate in any plan for the reorganization, consolidation or merger of any corporation, any security of which is held for the Trust, and to pay any and all calls and assessments imposed upon the owners of such securities as a condition of their participating therein; and to consent to any contract, lease, mortgage, purchase or sale of property, by or between such corporation and any other corporation or person. -14- - 3.304 To exercise or dispose of any right it may have as the holder of any security to convert the same into another or other securities, or to acquire an additional security. or securities, to make any payments, to exchange any security or to do any other act with reference thereto which it may deem advisable. 3.30: To deposit any security with any protective or re- organization committee, and to delegate to such committee such power and authority with relation thereto as to it may seem proper, and to agree to pay and to pay out of the Trust such portion of the expenses and compensation of such committee as to the Trustee may seem proper. 3.306 To execute and deliver any proxies or powers of attorney to such person or persons as to the Trustee may seem proper, granting-to such person such power and authority with relation to any property or securities at any time held for the Trust as to it may seem proper. 3.30' To renew or extend the time of payment of any obligation due or becoming due. 3.308 To compromise, arbitrate or otherwise adjust or settle claims in favor of or against the Trust and to deliver or accept in either total or partial satisfaction of any indebt- edness:or other obligation any property, and to continue to hold for such period of time as the Trustees may deem appropriate any property so received. 3.309 To exchange any property for other property upon such terms and conditions as to the Trustee may seem proper, and to give and receive money to effect equality in price. 3.310 To grant options to purchase any property, 3.311 To forclose any obligation by judicial proceeding or otherwise. 3.312 To sue or defend in 'connection with any and all securities or property at any time received or held for the Trust and all costs and a.ttorneysl fees in connection therewith shall be a charge against the Trust. -15- 3.313 To manage any real property in the same manner as if the Trustee were the absolute owner thereof, including the power to lease the same for such term or terms, and upon such conditions including, but not by way of limitation, agreements for the purchase or disposal of buildings.thereon or options to the tenant to renew such lease from time to time or to purchase such property, as the Trustee may deem proper; to make ordinary and extraordinary repairs and altera- tions to any building; to raze old buildings and to erect new buildings; to insure against loss by fire or other casualties; and to employ agents and confer upon them such authority with respect to the management of any such real property as the Trustee deems appropriate. 3.314 To borrow money, with or without giving security. 3.4o The Trustee may cause any securities held for the Trust to be registered and to carry any'such securities in the name of a nominee or nominees, 3.50 The Trustee shall not be liable for any losses which may be incurred upon the investments of the Fund except to the extent that such losses shall have been caused by its bad faith or negligence. ARTICLE FOUR 4.10 The Pension Board shall.maint'ain or shall delegate to another person or corporation the maintenance of a separate ledger account for each participating Member and shall credit or debit as the case may be each Member's account with all transactions relating to such Member's contributions, pro- portionate share of the corpus and income of the Fund, and disbursements as provided in the Plan. 4.20 The Trustee shall maintain accurate records and accounts of all investments, receipts, disbursements, and other transactions hereunder, and such records shall be available at all reasonable times to the inspection by the Pension Board, -16- 4.20 (Cont'd) the Town, or any authorized representative of either. 4,30 The Trustee, at the direction of the Pension Board, shall submit to the Board such reports,.or other information as the Board may reasonably require. In the absence of fraud or bad faith, the valuation of the Fund by the Trustee shall be conclusive. 4.4o Within sixty (60) days following the close of each Plan year, the Trustee shall file with the Board and with the Town a written account setting forth a description of all, securities and other property purchased and sold, all receipts, disbursements, and other transactions effected by it during such period, and listing the securities and other property held by it at the end of such period. 4.401 The Board may approve such account by written notice of approval delivered to the Trustee or by failure to express written objections to such account delivered to the Trustee within sixty (60) days from the date upon which the account was delivered to the Board. 4.402 Upon receipt of a written approval of the account or on the passage of said period of time within which objections may be filed, without written objections having been delivered to the Trustee, such account shall be deemed to be approved, and the Trustee shall be released and discharged as to all matters set forth in such account with the same effect as if such account had been settled and allowed by a decree of a Court of competent jurisdiction. ARTICLE FIFE 5.10 The Pension Board may from' time to time make recommendations to the Trustee with respect to the management and administration of this Trust, but such recommendations shall not be directory nor in any way restrict the powers of the Trustee herein provided. -17- 5.20 If the Trustee is in doubt concerning any matter relating to the management and administration of this Trust, it may request the Pension Board to advise it with respect thereto and shall be fully protected in relying upon the advice or direction which it may receive in response to such request. 5.30 The 'T'rustee may consult with legal counsel, including the Town Attorney or its own counsel, with respect to the meaning and interpretation of this Trust Instrument and of T,.the Plan, or its obligations and duties hereunder, or with respect to any action which may be taken or omitted hereunder, and it shall be fully protected with respect to any such action taken or omitted by it in good faith pursuant to the advice of such counsel, 5,40 The Trustee may resign as Trustee hereunder or may be 'removed by the Town. Such resignation or removal may be accomplished at any time upon the giving of ninety (90) days written notice.. Upon such resignation.or removal the Town shall appoint a successor. Trustee to whom the Trustee shall transfer all property of the Trust then held by it. Such successor Trustee shall thereupon succeed to all the powers and duties given to the Trustee by this Trust Instrument. 5.401 Within sixty (60) days of such transfer the resigning or removed Trustee shall render to the Pension Board and to the Town an account in the form and manner pre- scribed for the annual account by Section 4.40 hereof, Unless the Board shall within sixty (60) days after the. rendition of such account file with the Trustee written objections thereto, the account shall be deemed to have been approved and the Trustee shall be released and discharged as to all matters set forth in such account with the same effect as if such account had been settled and allowed by a decree of a Court of competent jurisdiction. 18- ARTICLE SIX 6.10 The 'T'rustee shall have no power or duty to determine the rights or benefits of any person having or claiming an interest in the Fund or under the Plan, or to examine into or control any disposition of the Fund or any part thereof which may be directed by the Pension Board. 6.20 The. Town and the Pension Board shall have the exclusive right to enforce the provisions of this Trust Instru- ment on behalf of all Members, former Members, or other persons having or claiming an interest in the.Fund or under the Plan. 6.30 No person entitled to any benefits under this Trust Instrument shall have any right to assign, transfer, hypothecate, encumber, commute, or anticipate his interest in any benefits under this Trust, and such benefits shall not in any way be subject to any legal process or levy of execution upon, or attachment or garnishment proceedings against the same for the payment of any claim against such person. ARTICLE SEVEN 7.10 The Town shall pay to the Trustee annually its expenses in administering the Trust and a reasonable compensa- tion for its services as Trustee hereunder at a rate to be agreed upon. ARTICLE EIGHT 8.10 It is the purpose and intention of the Town that this Trust and the Plan of which it is a part shall be permanently administered for the benefit of its employee Members, and this Trust is, accordingly, irrevocable; but, if changing conditions require, this Trust Instrument and the Trust created hereby may be terminated at any time by the Town, and upon such termin- ation the Trust shall be distributed by the Trustee as and when directed by the Pension Board in accordance with the provisions of Article Two hereof. From and after the date of termination of this Trust Instrument and the Trust and until the final -19- _ 8.10 (cont'd) distribution of the Fund, the Trustee shall continue to have all powers provided under this Trust Instrument as are necessary and expedient for the orderly liquidation and distribution of the Fund. 8.20 This Trust Instrument, other than Section 1.40 hereof, may be amended at any time by written agreement of the -Town and the Trustee; provided, however, that no amendment may be made which shall operate.to 8.201 Revest the Fund or any part thereof in the Town; or 8.202 Reduce the then accrued Pension or other benefits of any Member; or 8.203 Transfer accrued Pension or other benefits from one class of Member to another. ARTICLE NINE 9.10 This Trust will be administered in the State of California and its validity, construction, and all rights there- under shall be governed by the laws of said State. 9.20 If any provision of this Trust Instrument shall be invalid or unenforcable, the remaining provisions thereof shall continue to be fully effective. This Trust Instrument is executed in quadruplicate by the respective duly authorized officers of the Town of Los Gatos and of Bank, and Trust Company. Town of Los Gatos, Attest: by Mayor Town. Clerk Bank and Trust Company SECTION 7. TOVN! CONTRIBUTIONS (a) The Town shall make.due and timely payments to provide the benefits to which members'are entitled under the plan, as provided in Section 10 (a) of this ordinance, of such amount of money as may be necessary from time to time, according to the certification of the Board, but not in excess of the limitations provided by the laws of the State of California. (b) Each year, beginning with the year 1958, the Board, between the first day of May and the 30th of July of such year, shall estimate the aggregate amount necessary to provide the benefits to which members are entitled under the provisions of this ordinance, and the fees and expenses of administration of the trust, and shall certify such aggregate amount to the Town Manager. SECTION 8 INVESTMENT OF TO1vR, CONTRIBUTIONS. The. contributions provided for by Section 7 of this ordinance shall be invested as follows: (a) Upon the written request of the Board, the Council shall purchase, from designated life insurance companies, insur- ance contracts of such kind and in. such amounts as the Board may request for the purpose of providing the benefits to which the members shall be entitled under the provisions of Section 10 (a) hereof. (b) The Board shall use as the standard for measuring the amount of any insurance contract purchased to provide such benefits, the amount payable to each member under the settlement option contained in such insurance contract which guarantees monthly payments of the normal retirement benefits to which the member is entitled under Section 10 (a) hereof, beginning at the early or normal retirement date and continuing during the life,of the member, regardless of such other settlement options as may be afforded by such insurance contracts and regardless X21-. g (b)' (cont' a) of the possibility of payments in the nature of dividends in excess of the amounts guaranteed under the settlement option used as a standard. (c) Any dividend, refund or recovery due under any insurance contract purchased in accordance with the provisions of this ordinance shall be applied to the payment of premium in the next succeeding years on all 'contracts held for the members and shall, in corresponding amounts, reduce the premiums Dayable hereunder during such years. (d) The Town shall pay, in accordance with the certification by the Board under the provisions of Section ~ hereof, all premiums on all insurance contracts purchased in accordance with the provisions of this ordinance, such `payments to be made as they become due under the terms of such insurance contracts. SECTION 9, GUARANTY. (a) The payments by the Town as provided in this ordin- ance are hereby made the obligation of the Town, subject to any limitations imposed by the laws of the State of California. The Council shall annually ,approprriate.such amounts as are necessary to discharge the obligations of the Town hereunder, in accordance with the certifications made by the Board in accordance with the -provisions of Section 7 (b) of this ordinance. (b) The Town, subject to any limitations imposed by laws of the State of California, may at any time change, modify, amend or repeal this ordinance or any part thereof in respect to future obligations to any member. It is hereby specifically provided, however, and the Town hereby covenants and guarantees, that the Town's obligation incurred prior to such change, m_od.ifi- cation, amendment or repeal, to pensioners, to members then eligible toreceive pensions under the provisions of Section 10 (a) 22 9 (b) (Cont'dL). hereof, or to beneficiarftes then entitled to receive such benefits, shall continue in full force and effect as provided in this ordinances and that the Town's obligation to all other members at the time of such change, modification, amend- ment or repeal will be a pension, at the normal retirement date or early retirement date of each member equal to the actuarial eauivalent of the accumulated value of each member's contributions and the contributions of t'rie Town made on his behalf to such date, but without further contributions from the Town, except such contributions as may be provided for by such change, modification, amendment or repeal; provided that nothing in this section shall obligate the Town to snake any payments beyond any limitations imposed by the laws of the State of California. SECTION ld . BENEFITS. (a) The normal retirement benefits for every member from the Town's contributions, as provided in Section 7 (a) hereof, shall be a monthly pension, to be paid for life commencing at his normal retirement date, equal to the sum of the following: (i) For Current Service, after January 1, 1958: An amount of monthly income equal to one ninety-sixth (1/96th) of total contributions made by the member while under the plan. (ii) For Past Service, before January 1, 1958: If the member becomes a. member as of January 1, 1958, one-half of one per cent (1/2 of 1%) of his monthly rate of compensation on January 1, 1958 multiplied by the number of years of his service prior to January 1, 1958. (b) As to benefits from the Town's contributions, upon the written request of a member, filed with the Board in such form as the Board and the appropriate insurance company shall z23_ 10 (b) Cont'd) direct, the actuarial ecuivalent of his normal retirement benefit, taking, into consideration among other things the life expectancy of such member, shall be payable to the member for a stated number of years, or to the member as long as he shall live and, after his death, in monthly payments of a like or such smaller amount as he may elect, to such beneficiary as he may designate, provided, how- ever, that no such election shall be accepted by the Board unless it is in accordance with settlement options offered by the appropriate insurance company. (c) As to the member's contributions to the trust the member shall have the election upon his normal retirement date or upon his early retirement date to receive from the trustee (i) Such member's proportionate share of the Fund at such date: (ii) k part of such member's proportionate share of the Fund at such date or from time to time thereafter; or (iii) if no election to withdraw all or part of such member's proportionate share of the fund is made, the right to receive from the trustee such income as shall be distributed by the trustee from such member's proportionate share of the fund, and to designate a beneficiary of such member's proportionate share of the fund upon his death. (d) Upon the written request of the member filer with the Board in such form as the Board and the Trustee shall direct the member shall make such election or change in election (other than a previously filed election to be paid all of such member's proportionate share of the fund) with respect to such member's contributions; provided, however, that any election to withdraw nart of such member's proportionate share of the fund which would leave but a nominal amount in the trust may be construed by the Board as an election by such member to receive all of such member's proportionate share of the fund. ,_Z4_ SECTION 11. PAYMENT OF BENEFITS ® s (a) When any member shall reach his normal retire- ment date and shall retire from service he shall be entitled to the benefits provided in Section 10 hereof. The Board shall take such-action as may be necessary to provide for the payment of such benefits by the appropriate insurance company, and by the trustee. (b) If any member shall elect to 'retire on his early retirement date, he shall be entitled to receive such proportion- ately reduced paymenlB for life as may be actuarrily determined on the basis of the-contributions made on his behalf by the Town to. such early retirement date, and the Board shall take such action as may be necessary to provide for the payment of such benefits by the appropriate insurance company, either, at said early retire- date or at a deferred retirement date as the Board may elect, and to provide for the payment of benefits under the trust instru- ment as to his contributions to the fund. (c) As to the contributions made on a member's behalf by the Town, it shall be a full discharge of the duties hereunder of the Board, with respect to the payment of retirement benefits, to deliver to the pensioner or retired member a contract of the appropriate insurance company whereby such company agrees to make the payment of benefits provided for in Section 10 (a) hereof. (d) As to the contributions made by a member it shall be a full discharge of the duties hereunder 'of the Board that it advise thetrustee of the election made by such member for withdrawal from the fund or for payment of income from the trust as provided in Section 10 (c) and:(d) hereof. (e) In the event of the death of a member before retirement, there shall be paid to such beneficiary as he may have designated such member's proportionate share of the.fund as of the date of such:member's death. (f) In the event of a. retired member or pensioner's -25- ~I (f) (Cont,d) death before he shall have received retirement benefits equal to the total amount payable to said member and his beneficiary or beneficiaries in accordance with the settlement option selected by such member under the provisions of Section 10 (b)- of this ordinance, there shall be paid to such beneficiary as he may have designated, the excess over the total of all retirement benefits which have been paid to him at the time of his death. (g) If the services of a member should be discontinued for any reason whatsoever, except retirement, death, authorized military leave, or authorized leave of absence without pay, he shall be entitled to receive his proportionate share of the fund as of the date of termination of his services to the Town. If, however, the services of such member should be discontinued after twenty years or more of service, at least (5) years of which shall be represented by current service participation in this Plan, but before his early retirement date, said member may elect within 30 days of the discontinuance of his service, in such manner as the Board shall decide, not to withdraw the amount of his proportionate share of the fund and to make any of the elections authorized for members who have reached normal retirement date as provided in. Section 10(c) hereof, and to receive a paid up annuity, commencing at his early or normal retirement date, of such amount as can, on the date of the discontinuance of his service, be purchased with the total of contributions made on his behalf by the Town, including contributions for the past service benefits; or, with the approval of the Board, he may elect any other benefit which is the actuarial equivalent of such paid- up annuity and which is available under the appropriate insurance contract. (h) If any member, pensioner, or beneficiary entitled to receive any benefits hereunder shall be physically or mentally -26- (h) (Cont'd) incapable of receiving or acknowledging receipt thereof, and if no legal representative has been appointed for hire, the Board may cause any benefits otherwise payable to him to be made to the person or persons designated in writing by the member as authorized to receive and acknowledge receipt thereof on his behalf, and any payment so made shall be a complete discharge of all liabilities in respect to such payment. (i) Should the services of any member be discontinued for any reason except death, retirement, authorized military leave or authorized leave of absence without pay and should payment be made to him in accordance with the provisions of this ordinance, and should he again become an employee of the gown, he shale be considered, for all purposes of this ordinance, a new employee, and entitled only to the rights given by this ordinance to an employee employed after the pension effective date, and only from the date of his reemployment. Should the service of a member be discontinued by reason of authorized military leave or authorized leave of absence without pay, the member shall within 30 days of cessation of service to the Town elect in such manner as the 3oard shall decide, whether or not to withdraw his proportionate share of the fund. Should the member elect to receive his proportionate share of the Fund and should he again resume employment with. the Town, he shall be considered, for all purposes of this ordinance, a new employee and entitled only to the rights given by this ordinance to an employee employed after the pension effective date, and only from the date of his reemployment. As an alternate to with- drawal from the Plan, the member may elect to permit his contribu- tions to remain in the fund until such time as the authorized leave shall expire. If the member so elects said alternate plan neither the member nor the Town shall make any further eontri- -27- ( (Cony d) butions to the Plan to the credit of the member, but all con- tributions of the member and the Town, shall remain pending further disposition. Upon conclusion of said period of author- ized leave,,if the member has.elected to remain in the Plan, and If the member, within 3 months, resumes regular employment with the Town, he and the Town shall resume making contributions to the Flan and all contributions made prior to said leave shall remain to the credit of said member. Should the member not resume ...-employment with the Town within 3 months of termination of said authorized leave, he shall be entitled to his proportionate share of the fund as of the expiration of 3 months following the termina- tion of said authorized leave. Should the member not resume employment with the Town within 3 months of termination of said authorized leave and should said member have rendered, before his early retirement or normal retirement date, twenty years or more of service, at least five (j) of which were on a. current service basis under this Plan, the said member may elect within 3 months of said termination of authorized leave in such manner as the Board may decide.., not to withdraw his proportionate share of the fund and to make any other of the elections provided by Section 10 (c) hereof, and to receive a paid-up annuity, commencing at his early or normal retirement date, of such amount as can, on the date of the discontinuance of his service to the Town, be purchased with the.total of contributions made on his behalf by .the Town, including contributions for the past service benefits; or, with the approval of the Board, he may elect any other benefit which is the actuarial equivalent of such paid-up annuity and which is available under the appropriate insurance contract. It is further provided that in the event a member on authorized military leave has previously elected said alternate plan to have his contributions and applicable interest remain 11 in the plan, and such employee volumtarily requests an extension -28- (J) (Contfd) of his original term of enlistment, service, or tour of duty with the Armed Forces.of the United States of America or with the Militia of the State of California, and if he is accepted by said Armed Forces or said Militia, and he has not previously ,been repaid his proportionate share of the fund as herein provided, said employee shall in such event be deemed to have elected to with- draw from the plan; and said member shall be deemed to not be on authorized leave;. and the said member shall be entitled to and shall receive his 'proportionate share of the fund which shall be payable by the trustee at any time after the date of his re- enlistment. Should said member thereafter resume employment with the Town, he shall be considered for.all purposes of this ordin- ance as a new employee and be entitled only to the rights given by this ordinance to an employee employed after the pension of festive date-and only from the date of his re-•einployment. It is further provided, however, that in the event such member shall have previously elected said alternate plan to have his contributions remain in the plan,.and such employee voluntarily requests.an extenssion of his original term of enlistment, service, or tour of duty with the Armed Forces of the United States of America, or with the Militia of the State of California, and if he is accepted by said Armed Forces or said Militia, and he has not previously been repaid his pro- portionate share of the fund, and should he have rendered, before his early retirement or normal retirement date, twenty years or more of service, at least five (5) of which were on a current ser- vices basis under this Plan, and such member within 3 months of his discharge from the Armed Forces or Militia is re-employed by the Town, he shall be deemed to have resumed his regular employment as upon the conclusion of authorized leave and be restored to all rights and privileges as contained in this ordin -29- (j) (Cont'd). ante. Should the member not be re-employed by the Town within 3 months of his said discharge, the said member may elect at any time prior to the expiration of 3 months from his discharge from the Armed Forces of Militia its such manner as the Board may decide, not to withdraw his proportionate share of the fund and to make any other of the elections provided by Section 10 (c) hereof, and to receive a paid-up annuity, commencing at his early or normal retirement date, of such amount as can, on the date of the --di'scontinuance of his service, be purchased with the total of contributions made on his behalf by the Town, including contri- butions for the past service benefits; or, with the approval of the Board, he may elect any other benefit which is the actuarial equivalent of such paid-up annuity and which is available under. the appropriate insurance contract SECTION 12. EDIPLOYEES OVER MAXIMUM AGE FOR MEMBERSHIP. (a) if an employee, otherwise eligible for membership in the Pension Plan has attained age 65 on the pension effective date., he shall, commencing thirty (30) days from the date of his retirement from service, be entitled to receive, and shall receive, a monthly pension for life in the amount determined by the Council, but not exceeding $30.00 per month, the said pension to be paid by the 'down without contributions from any such employee. (b) The Board shall annually estimate the amount. required for the payment of any pension to any retired employee entitled to pen.si©n. under the provisions of this section of this ordinance, such amount to be in addition to all other amounts to be estimated by the Board under the provisions, of this ordinance; and said amount shall be certified by the Board to the Townn. Manager, and all such pensions shall be paid in monthly install- ments by the Town In.,addition to other amounts required to be paid by or on behalf of the Town under the provisions of this ordin- ance. y SECTION 13. EXEMPTION FROM EXECUTION. The right of a person to a pensions to his proportionate share of the fund, to any optional benefit, or to other right accrued or accruing to any person under the provisions of this ordinance, and the moneys constituting contributions under this ordinance and to the fund shall not be subject to execution, garnishment, attachment, or any other process whatsoever, and shall be unassignable except as in this ordinance specifically provided. Notwithstanding anything to the contrary herein, if participating employee borrows from the Town or is otherwise indebteded to the Town, the-Town shall have a first lien for such amounts owing to it to the extent of the participating employee's vested rights in any benefits provided for herein and, if such amounts are not fully paid to the Town on or before the date on which the participating employee or his beneficiary becomes entitled to the payment of any benefits.hereunder, the unpaid balance then owing to the Town shall be first paid to it before any distributions are made to the participating employee or his beneficiary. SECTION 14. COORDINATION WITH SOCIAL SECURITY BENEFITS. The Council .having heretofore entered into a contract with the Director of Finance effective January 15, 1951 under the provisions of Sections 13775 to 13751, of the Government code of the 'State of California, to provide for the coverage of employees under the Federal Social Security Act, it is.hereby expressly provided that the Plan may be modified or changed in any gray to coordinate the Plan with any future amendments to said Federal Act, or with any other Federal law hereafter to provide old age benefits, or with any lair enacted by the legislature of the State of California to provide old age benefits. SECTION 15. CONSTITUTIONALITY. If any Section, or Sections, or part of any Section of this ordinance shall be found _31_ r SECTION 15. (Cont'd). to be unconstitutional or invalid, for any reason, the remainder of the ordinance shall not thereby be invalidated, but shall remain in full force and effect. SECTION 16. CONFLICTING ORDINANCES. All ordinances and parts of ordinances insofar as they conflict with this ordinance are hereby repealed. SECTION l7. ENACTMENT. Introduced at a regular meeting of the Town Council of the Town of.Los Gatos, State of California, held on the 6th day of April, 1959. PASSED AND ADOPTED as an Ordinance of the Town of Los Gatos, State of California-, at a regular meeting of the Town Council thereof, held on theday of 1959, by the following vote: AYES: COUNCILMEN: _~~d~a. F NOES : COUNCILMEN : ABSENT: COUNCILMEN: A OF3 OF E O 1' OF LOS ATGS ATTEST: CLERK OF E TON OF LOS GATOS -32- ® TRUST AGREEMENT FOR THE TOWN OF LOS GATOS PENSION PLAN This Trust Instrument is made and executed this day of 1959, between the Town of Los Gatos, a municipal t corporation nd general law city of the State of California, herein- after ca~lsd the "Town", The Bank of California National Association, hereinafter called the "Trustee", for the benefit of the qualified employees of the Town, hereafter called "Newborn." 3TATSYBNT OF BASIC FACTS AND PURPOSES. (a) The Town by its Ordinance Number 451, duly adopted by -its Town Council on December 2, 1957, and as amended by its Ordinance Number 494 duly adopted by its Town Council on April 20, 1959, created and established a Pension Plan for its employees and appended hereto, designated Exhibit "A", and by this reference specifically made a part hereof, is a copy of said Ordinance Number 451 as amended, and which shall hereafter be referred to as the "Pension Plan" or "Plan". (b) This Trust is created in the United States and forms a part of the Plan which was established by the Town fpr the exclusive benefit of its employees or their beneficiaries. (c) This Trust is formed for the purpose of distributing to the employees or their beneficiaries the corpus and income of the Fund accumulated by the Trust in accordance with the Plan. (d) It is intended that this Trust Instrument create a qualified Trust under the provisions of Section 401 of the Internal Revenue Code.of 1954 and under the provisions of Division 2, Part 10, Chapter 5, Article 1 (Section 17501 et seq.) of the Revenue and Taxa- tion Code of the State of California. (e) Words and phrases used in this Trust Instrument, unless a different meaning is plainly required by the context, shall have the same meanings as stated in Section 3 of the Plan. -1- i0RIEUNTS AND ADMINISTRATION OF THE TRUST. In considerikon of the foregoing, and foood and valuable eansideration the receipt of which is hereby acknowledged, the Trustee &green that it will hold any and all sums which may from time to time i be paid to it as Trustee hereunder, in Trust, for the uses and pur- ? pews and spot the terms and conditions hereinafter stated. ARTICLE ONE 1.10 The Trustee shall accept contributions to the Trust made under the terms of the Plan and shall hold, manage, and adminis- ter the Trust without distinction between principal and income.'. 1.50 Contributions delivered to the Trustee hereunder and any and all income, profits, or other property produced or otherwise acquired therefrom shall constitute the corpus of this Trust hereinafter called the "Fund"., 1.30 The rand shall be held and administered by the Trustee for the exclusive benefit of Members and retired Members under the Plan and the banef iciaries of such Members pursuant to the provisions of the Plan. 1.40 Irrespective of any inconsistent provision contained herein or in the Plan, it shall be impossible, whether by operation or by natural termination of the Trust, by power of revocation or amendment, by the happening of any contingency, by collateral arrange- ment, or by any other means, at any time before the termination of this Trust and the satisfaction of all liabilities with respect to Members or retired 'embers and their beneficiaries for any part of the Fund (excepting such part as may be required to pay taxes and administration expenses) to revert to or be recoverable by the Town or to be used for or diverted to purposes other than for the exclusive benefit of Members or retired Members or their beneficiaries and, only then, may recovery be had by the Town to the extent of any surplus existing because of erroneous actuarial computations. 1.50 The Trustee shall be responsible only for sums actually received by it as Trustee hereunder. f 1.60 The Trustee shall be under no duty, and'it shall have no right to compute any amount to be paid into the Fund pursuant to the a Plan, or to Coll any,.4ums from the Town whic"- a,, accrue under the Plan. r t 1.70 The Trustee shall not be responsible for the adequacy of this Trust to meet aVd discharge any and all payments and liabili- ties tinder the Plan. a dl?ICli TWO 2.10 The Town shall advise the Trustee is writing of the saves of the members of the Pension Board and shall advise the Trustee Is writing of all changes is '*uch membership. 3.30 Directions or recommendations to be received by the 'trustee hereunder from the Pension Board shall be in writing and shall such be signed by a majority of the then members of said Board or by person as may from time to time be designated to transmit such direc- tions or reoom sudatlons to the Trustee. 3.30 The Trustee may rely or actcupon such written direc- tions or recommendations from the Pension Board signed by a majority of the then members thereof, or upon receipt of a certified copy of the minutes of such Board signed by the person so designated by the Board indicating that a majority of the then members thereof approved such direction or reoommesdation. 3.40 -The Trustee shall from time to time on the written directions of the Passion Board given to it as heroin above provided mare distributions from the Trust to such persons in such manner, in such amounts, and for such purposes as may be specified in such directions. 4, 3.50 The Trustee shall incur no liability for any distribu- tion made by it pursuant to the directions of the Board. 2.60 In mating a distribution upon directions of the Pension Board the Trustee shall be under no duty to mate inquiry as to whether such distribution is made pursuant to the Plan, and it nay accept such directions as a certification that such distribution complies with the provisions of the Plan and with the provisions of Section 1.40 of this Trust Instrument. 2.70 The Board shall promptly notify the Trustee in writing -3 of all changes in such list and in the compensation of such Sanborn. In the absence of dice of changes, the Trustee 011 be entitled to L assure that the list then in its possession is current. ARTICLE THREE 3.10 The Trustee is hereby authorised to hold such portion of the Band as it may deem necessary for the ordinary administration of this Trust and the disbursements of funds in cash without liability for interest by depositing the same in any tank (including the Strings awd Comereial dspartaests of the Trustee) subject to the rules and regulations governing such deposit* and without regard to the amount of any such deposit. 3.20 The Trusts* shall have full power to invest mad reis- "at the Fund of this Trust in any investments permitted by law for the investment of trust funds in the state of California, and as Kay be directed by the Pension Board. 3.30 The Trustee shall have fall power, is respect to any and all contributions, securities or property at any time received or held as a part of the hind of this Trust, to do all such acts, take all such proceedings and exercise all such rights and privileges, whether herein apecif iaally referred to or not, as could be done, takes or exercised by the absolute owner thereof, including, without in any way limiting or impairing the gmnerality of the forogoiag, the following powers and authority: 3.301 To retain the same for such period of time as it dooms appropriate. 3.309 To, sell the ease, at either public or private sale, at such tine or times and on such torus and conditions as to credit or otherwise as to it may sees appropriate. 3.303 To consent to or participate in any plan for the reorganization, consolidation or merger of any corporation, any security of which is held for the 'must, and to pay any and all calls and assess- ments imposed upon the owners of such securities as a condition of their participating therein; and to consent to any contract, lease, mortgage, -4- purchase or sale of property, by or between such corporation and any other corporation or #rion. 3.304 To exercise or dispose of any right it may hays pA the holder of any security to convert the same into another or other securities, or to acquire as additional security or securities, to assts say,paymests, to exchange any security or to do any other act with refs:sacs thereto which it may does advisable. 3.305 To deposit any security with any protective or reorganisation committee, and to delegate to such committee such power and authority with relation thereto as to it may seem proper, and to agree to pay and to pay out of the Trust such portion of the expenses and compensation of such committee as to the Trustee may seem proper. . 3.308 To execute and deliver any proxies or powers of attorney to such person or persons as to the Trustee may sees proper, granting to such person such power and authority with relation to any property or securities at any time held for the Trust as to it may sees proper- 3.307 To renew or extend the time of payment of any obligation due or becoming due. 3.308 To compromise, arbitrate or otherwise adjust or settle claims in favor of or against the Trust and-to deliver or accept in sibher total or partial satisfaction of any indebtedness or other obligation any property, and to continue to hold for such period of time as the Trustee may deem appropriate any property so received. 3.308 To exchange any property for other property upon such terms and oonditions as to the Trustee may seen proper, and to give and receive money to effect equality in price. 3.310 To grant options to purchase any property. 3.311 To foreclose any obligation by judicial proceeding or oth wise. 3.312 To securities or property a, .11 costs and attorneys' .;ea st the Trust. 3.313 To sue or defend in connection with any and all t any time received or held for the Trust and fees in connection therewith shall be a charge manage any real property in the same manner as -5- ~-i if the Trustee were ~e absolute owner thereof, iWding the Doter to ' lease the same for such tors or terns, and upon such conditions includ- ing, but not by say of limitation, agreements for the purchase or dis- posal of buildings thereon or options to the tenant to resew such lease from time to time or to purchase such property, as the Trustee MAY deem proper; to mare ordinary and extraordinary repairs and alterations to any building; to rase old buildings and to erect new buildings; to insure against loss by fire or other casualties; and to employ agents and oosfer upoa then such authority with respeet to the'sanagemeat of any such real property as the Trustee dooms appropriate. 3.314 To borrow money, with or without giving security. 3.40 The Trustee say cause any securities hold for the Trust to be registered and to carry any such securities in the name of a aqulnee or nominees. 3.50 The Trustee shall not be liable for any losses which may be incurred upon the investments of the fund except to the extent that such losses shall have been caused by its bad faith or negligence. ARTICLE FOUR 4.10 The Pension Board shall maintain or shall delegate to another person or corporation the maintenance of a separate ledger aocoast for each participating Member and shall credit or debit as the case say be each Member's account with all transactions relating to such Member's contributions, proportionate share of that corpus and income of the Fund, and dtabursesents as provided in the Plan. 4.20 The Trustee shall maintain accurate records and accounts of all investments, receipts, disbursements, and other transactions here- under, and such records shall bge:availadle at all reasonable times to the inspection by the pension Board, the Town, or any authorized repre- sentative of either. 4.30 The Trustee, at the direction of the Pension Hoard, shall submit to the Hoard such reports, or other information as the Hoard may reasonably require. In theAbsence of fraud or bad faith, the valuation of the Fund by the Trustee shall be conclusive.. k~^ f~ ?i S~ 1 s -6- plan year, the Trueshall file with the board with the Town a written account setting forth a description of all securities and other property purchased and sold, all receipts, disbursements, aad other transactions effected by it daring such period, and liming the securities +ind other property held by it at the end of such period. 4.401 The Board may approve such account by written ~rotiee of approval delivered to the Trustee or by failure to express written objections to such account delivered to the Trustee within *AS" (60) days from the date upon which the account was delivered to the Board, 4.402 Upon receipt of a written approval of the account or on the passage of said period of time within which objections may be 'filed, without written objections having been delivered to the Trustee, s7ioh account shall be deemed to be approved, aad the Trustee shall be released and discharged as to all utters not forth in such account with the sane effect as Af such account had been settled and allowed by a decree of a Court of competent jurisdiction. ARTICLE FIVE 5.10 The Pension Board may from time to time mate recommenda- tions to the Trustee with respect to the management and administration of this Trust, but such recommendations shall not be directory nor ig any way restrict the powers of the Trustee herein provided. 5.20 If the Trustee is in doubt concerning any matter relating to the management and administration of this Trust, it, may request the Pension Board to advise it with respect thereto and shall be fully pro- tected in relying upon the advice or direction which it may receive in response to such request. 5.30 The Trustee may consult with legal counsel, including the Town Attorney or its own counsel, with respect to the meaning and interpretation of this Trust Instrument and of the Plan, or its obliga- tions and duties hereunder, or with respect to any action which may be taken or omitted hereunder, and it shall be fully protected with respect to any such action taken or omitted by it in good faith pursuant to the -7- 4" AL iA td d..+4 (e?t19 4itn:.e LfA ta±aBv+L g adw v dear' - 5.40 The ~atoo may resign as Trustee under or may be removed by the Town. Such resignation or removal may be accomplished at any time upon the giving of ninety (90) days written notice. Upon I such resiguatien or removal the Town shall appoint a successor Trustee to whom the Trustee shall transfer all property of the Trust then held by it. Snob successor Trustee shall thereupon succeed to all the powers i and duties given to the Trustee by this Trust Instrument. 5.401 vithia sixty (60) days of such transfer the re- signing or removed Trustee shall render to the Pension Board and to the Town an account in the form and manner prescribed for the annual account ~ by Section 4.40 hereof. Unless the Board shall within sixty (60) days i I alter the rendition of such account file with the Trustee written objections thereto, the account shall be deemed to have been approved and the Trustee shall be released and discharged as to all matters set forth in such account with the same effect as if such account had been settled and allowed by a decree of a Court of competent jurisdiction. ARTICLE SIX 6.10 The Trustee shall have no power or duty to determine the rights or benefits of any person having or claiming an interest in the Fund or under the Plan, or to examine into or control an disposition of the Fund or any part thereof which may be directed by the Pension Board. 6.20 The Town and the Pension Board shall have the exclusive right to enforce the provisions of this Trust Instrument on behalf of all Yemberss former Members, or other persons having or claiming an in- terest in the Fund of under the Plan. 6.30 No person entitled to any benefits under this Trust transfer, hypothecate, encumber, Instrument shall have any right to assign, commute, or anticipate his interest in any benefits under this Trust, a be subject to any legal process and such benefits shall not in any wy or levy of execution upon, or attachment or garnishment proceedings s arson. against the same for the payment of any claim against any such p ARTICLE SEVEN -8- - to The o~ s a pad TO o ue ee ia administering the T and a veasonable coupensa for its services as Trustee hereunder at a rate to be agreed upon. l ARTICLE EIGHT 8.10 It is the purpose and intention of the Town that this Trust and the plan of which it is a part shall be permanently adminis- tered for the benefit of its employee, Members, and this Trust is, acoordingly, irrevocable; but, if changing conditions require, this Trust Instrument and the Trust created hereby may be terminated at any tine by the Town, and upon such termination the Trust shall be distributed by the Trustee as and whoa directed by the pension Board in accordance with the provisions of Article Two hereof. From and after the date of termination of this Trust Instrument and the Trust and until the final f distribution of the Fund, the Trustee shall continue to have all powers provfdsd under this Trust Instrument as are necessary and expedient for the orderly liquidation and distribution of the Fund. 8.20 This Trust Instrument, other than Section 1.40 hereof, may be amended at any tin by written agreement of the Town and the Trustee; provided, however, that no amendment may be made which shall operate to: 8.201 Revest the Fund or any part thereof in the Town; or 8.202 Reduce the then accrued Pension or other benefits of any Member; or 8.203 Transfer accrued Pension or benefits from one class of Member to Laother. ARTIWL$ NIKE 8.10 This Trust will be administered in the Rate of Cali- fornia and its validity, construction, and all rights thereunder shall be governed by the laws of said State. 2.20 If any provision of this Trust Instrument shall be in- valid or unenforceable, the remaining provisions thereof shall continue to be fully effective. This Trust Instrument is executed in quadruplicate by the respective duly authorized officers of the Town of Los Gatos and 68 Bank and Trust Company. -9- 0 To.n of Los Gat by -4~zl 2~ wa'or o e o-wa OIL LOA Gatos The Bank of California N. by Irl' "i, - -V 6, i - ~ by