CALDWELL FAMILY INSURANCE TRUST
NOTICE OF WITHDRAWAL RIGHT
(CRUMMEY NOTICE)
Form Template for Annual Use by Trustee
This form notice is prepared for annual use by Northgate Trust Company of Delaware, as Trustee of the Caldwell Family Insurance Trust (the "Trust"), established on March 15, 2023, by Jonathan R. Caldwell, as Grantor, and governed by the laws of the State of Delaware. A separate notice in this form must be completed and delivered to each Crummey beneficiary promptly upon each contribution by the Grantor to the Trust. This form should be completed by the Trustee and reviewed by counsel prior to each annual distribution.
Trust: Caldwell Family Insurance Trust, dated March 15, 2023
Grantor: Jonathan R. Caldwell
Trustee: Northgate Trust Company of Delaware, 1201 North Market Street, Suite 1600, Wilmington, DE 19801
Governing Law: State of Delaware
Date of Notice: ______, 20__
NOTICE ADDRESSEE
Complete the following address block for the beneficiary to whom this notice is being sent. A separate notice must be prepared and mailed to each of the three (3) designated Crummey beneficiaries upon each contribution by the Grantor to the Trust.
To:
______ [Beneficiary Name]
______ [Street Address]
______ [City, State, Zip Code]
Eligible Crummey Beneficiaries (for Trustee reference):
• Thomas R. Caldwell, 55 Perry Street, Unit 3, New York, NY 10014
• Katherine C. Hartfield, 210 Briarcliff Lane, Greenwich, CT 06830
• Olivia G. Caldwell, 1240 North Dearborn Street, Apt. 807, Chicago, IL 60610
Trustee Instruction: A separate, individually addressed notice must be sent to each beneficiary listed above upon each contribution made by the Grantor to the Trust. Do not send a single collective notice.
SECTION 1: NOTICE OF CONTRIBUTION TO TRUST
Dear ______ [Beneficiary Name]:
You are hereby notified that on ______, 20 (the "Contribution Date"), the Grantor, Jonathan R. Caldwell, made a contribution to the Caldwell Family Insurance Trust (the "Trust") in the amount of **$_____** (_____ Dollars).
The purpose of this contribution is to fund the annual premium payment on the second-to-die universal life insurance policy (the "Policy") issued by Beacon Life Assurance Company, bearing Policy No. BLA-2023-77419, insuring the joint lives of Jonathan R. Caldwell (date of birth: March 14, 1956) and Eleanor V. Caldwell (date of birth: September 22, 1958), with a death benefit of Fifteen Million Dollars ($15,000,000). The annual premium on the Policy is One Hundred Eighty-Seven Thousand Five Hundred Dollars ($187,500).
The contribution described herein is held by Northgate Trust Company of Delaware, in its capacity as Trustee of the Trust, and is subject to the terms and conditions of the Trust Agreement dated March 15, 2023, as the same may have been amended from time to time (the "Trust Agreement").
This notice is being provided to you because you are a designated beneficiary of the Trust who holds a present right of withdrawal with respect to contributions made to the Trust, as more fully described below.
SECTION 2: RIGHT OF WITHDRAWAL
Pursuant to Article __ of the Trust Agreement dated March 15, 2023, you, as a designated beneficiary of the Trust identified in this notice, have the present right to withdraw from the Trust an amount equal to the lesser of:
(a) the amount of the contribution described in Section 1 above that is attributable to you as a beneficiary of the Trust; or
(b) Five Thousand Dollars ($5,000).
The foregoing withdrawal right (sometimes referred to as a "Crummey" withdrawal right) is designed to qualify each beneficiary's share of the Grantor's contribution to the Trust as a present-interest gift eligible for the federal gift tax annual exclusion under Section 2503(b) of the Internal Revenue Code of 1986, as amended (the "Code"). Under current law, the federal gift tax annual exclusion for calendar year 2023 is Seventeen Thousand Dollars ($17,000) per donee. Your individual withdrawal right of Five Thousand Dollars ($5,000) falls within this annual exclusion amount.
For informational purposes, you should be aware that the total annual premium of $187,500 is allocated among three (3) Crummey beneficiaries of the Trust. The aggregate amount sheltered by the federal gift tax annual exclusion is Fifty-One Thousand Dollars ($51,000), calculated as follows: $17,000 per beneficiary × 3 beneficiaries = $51,000. The remaining balance of One Hundred Thirty-Six Thousand Five Hundred Dollars ($136,500) is applied against the Grantor's remaining lifetime gift tax exemption (the "applicable exclusion amount") under Section 2505 of the Code.
Your withdrawal right is a present, legally enforceable right. You are entitled to exercise it in full, in part, or not at all, in your sole and absolute discretion, subject to the terms and time limitations set forth in this notice.
SECTION 3: WITHDRAWAL PERIOD
Your right to withdraw the amount described in Section 2 above begins on the date of this notice and shall expire at 11:59 p.m. Eastern Time on the date that is thirty (30) calendar days after the date of this notice (the "Withdrawal Period").
If you do not exercise your withdrawal right in writing delivered to the Trustee within the Withdrawal Period, your right to withdraw the amount described herein will lapse automatically, without any further action required on your part, and the full amount of the contribution will remain in the Trust, subject to the terms and provisions of the Trust Agreement.
The Withdrawal Period is calculated as follows:
Date of This Notice: ______, 20__
The Withdrawal Period Expires On: ______, 20__
(thirty (30) calendar days from the date of this notice)
You are strongly encouraged to note these dates and to take whatever action you deem appropriate, if any, well in advance of the expiration of the Withdrawal Period.
SECTION 4: METHOD OF EXERCISE
To exercise your withdrawal right, you must deliver a written request to the Trustee at the following address before the expiration of the Withdrawal Period:
Northgate Trust Company of Delaware
Attn: Philip A. Rossiter, Senior Vice President, Trust Administration
1201 North Market Street, Suite 1600 Wilmington, DE 19801
Your written request must satisfy each of the following requirements:
(a) The request must identify you by your full legal name as a beneficiary of the Trust.
(b) The request must reference the Caldwell Family Insurance Trust dated March 15, 2023, and must identify this notice by date.
(c) The request must state the specific dollar amount you wish to withdraw, which amount may not exceed the maximum withdrawal amount of Five Thousand Dollars ($5,000) as set forth in Section 2 above.
(d) The request must be signed by you personally. In the event that you are a minor beneficiary (under the age of eighteen (18)), the request must be signed by your duly appointed legal guardian on your behalf, together with evidence of such guardianship satisfactory to the Trustee.
Upon receipt of a valid and timely written withdrawal request that satisfies the foregoing requirements, the Trustee will distribute the requested amount to you within a reasonable time, but in no event later than ten (10) business days following the Trustee's receipt of such request. Payment will be made by check payable to you, delivered to your address of record, or by such other method as you and the Trustee may agree.
Any withdrawal request that is incomplete, unsigned, or received by the Trustee after the expiration of the Withdrawal Period will not be honored, and the withdrawal right will be deemed to have lapsed in accordance with Section 5 below.
SECTION 5: CONSEQUENCES OF NON-EXERCISE / LAPSE
If you do not exercise your withdrawal right during the Withdrawal Period, your right to withdraw will lapse in its entirety, automatically and without further notice to you.
Upon the lapse of your withdrawal right, the contributed amount (including the portion thereof that was subject to your withdrawal right) will continue to be held and administered by the Trustee in accordance with the terms of the Trust Agreement. The Trustee will apply such amounts in the manner directed by the Trust Agreement, including, without limitation, for payment of the annual premium on the Policy described in Section 1 above.
Important Tax Notice: The lapse of your withdrawal right may have federal gift tax and/or generation-skipping transfer tax consequences to you. You are strongly encouraged to consult with your own independent tax advisor regarding the tax implications of exercising or not exercising this withdrawal right. Neither the Trustee nor the Grantor is providing you with tax advice in connection with this notice.
For your information, the Trust was designed so that the annual lapse of each beneficiary's withdrawal right falls within the safe harbor provided by Section 2514(e) of the Code, which provides that the lapse of a general power of appointment during any calendar year is treated as a release of such power (and therefore as a taxable transfer) only to the extent that the value of the property that could have been appointed by exercise of the lapsed power exceeds the greater of Five Thousand Dollars ($5,000) or five percent (5%) of the aggregate value of the assets out of which, or the proceeds of which, the exercise of the lapsed power could have been satisfied. Accordingly, because the maximum annual withdrawal right per beneficiary does not exceed $5,000, the lapse of your withdrawal right in any year is not expected to result in a taxable transfer by you under the Code, provided the aggregate value of the Trust assets is at least $100,000. However, you should confirm this analysis with your own tax advisor based on your individual circumstances.
SECTION 6: NO OBLIGATION TO WITHDRAW; INDEPENDENT DECISION
You are under no obligation to exercise or to refrain from exercising the withdrawal right described in this notice. The decision to exercise or not exercise your withdrawal right is entirely your own decision, to be made freely and independently, in your sole and absolute discretion.
Neither the Grantor, Jonathan R. Caldwell, nor the Trustee, Northgate Trust Company of Delaware, nor any other person, has made or will make any agreement, understanding, arrangement, side letter, or other commitment with you—whether express, implied, written, or oral—regarding the exercise or non-exercise of this withdrawal right. No person has suggested, requested, or implied that you should refrain from exercising your withdrawal right, nor has any person offered or provided you with any consideration, inducement, or other benefit in connection with the non-exercise of this right.
Your withdrawal right is a genuine, present, and legally enforceable right, and the Trustee stands ready to honor any valid and timely exercise thereof in accordance with the terms set forth in this notice and the Trust Agreement.
SECTION 7: COUNSEL AND ADVISORS
You may wish to consult with your own independent legal and tax advisors regarding the implications of this notice, including the tax consequences of exercising or not exercising your withdrawal right.
Please be advised that Calderwood & Harkness LLP, located at 375 Park Avenue, 42nd Floor, New York, NY 10152, serves as legal counsel to the Grantor, Jonathan R. Caldwell, in connection with the establishment and administration of the Trust. Calderwood & Harkness LLP does not represent you or any beneficiary of the Trust in connection with this notice, the withdrawal right described herein, or any matter relating to the Trust. The Trust was prepared as part of the Caldwell generational estate plan under Calderwood & Harkness LLP Matter No. 1034-00004.
If you have questions regarding this notice or the withdrawal right described herein, you may contact the Trustee, Northgate Trust Company of Delaware, at the address set forth in Section 4 above, or by telephone at the number provided in your separate account correspondence. The Trustee can provide factual information regarding the Trust and the withdrawal right but cannot provide legal or tax advice.
TRUSTEE EXECUTION
This Notice of Withdrawal Right is given by the undersigned in its capacity as Trustee of the Caldwell Family Insurance Trust, dated March 15, 2023.
NORTHGATE TRUST COMPANY OF DELAWARE, as Trustee of the Caldwell Family Insurance Trust
By: ________
Name: Philip A. Rossiter
Title: Senior Vice President, Trust Administration
Date: ________
ACKNOWLEDGMENT OF RECEIPT
(Optional — For Trustee's Records)
This Acknowledgment of Receipt is provided for the convenience of the Trustee's records. Completion and return of this acknowledgment is recommended but is not required in order for the withdrawal right to be effective. Whether or not this acknowledgment is signed and returned, the Withdrawal Period will commence on the date the notice is sent and will expire thirty (30) calendar days thereafter.
I, ________ [print full legal name of beneficiary], hereby acknowledge receipt of the foregoing Notice of Withdrawal Right (Crummey Notice) issued by Northgate Trust Company of Delaware, as Trustee of the Caldwell Family Insurance Trust, dated _____, 20__.
I understand that I have thirty (30) calendar days from the date of the above-referenced notice to exercise my right to withdraw up to Five Thousand Dollars ($5,000) from the Caldwell Family Insurance Trust, in accordance with the terms and procedures set forth in the notice.
I further understand that if I do not deliver a valid written withdrawal request to the Trustee within the Withdrawal Period, my withdrawal right will lapse automatically, and the contributed amount will remain in the Trust, subject to the terms of the Trust Agreement.
I acknowledge that I have been advised to consult with my own independent legal and tax advisors regarding the implications of this notice and my withdrawal right.
________________________________________
Signature of Beneficiary
________________________________________
Printed Name of Beneficiary
________________________________________
Date
Please return this signed Acknowledgment of Receipt to:
Northgate Trust Company of Delaware
Attn: Philip A. Rossiter, Senior Vice President, Trust Administration
1201 North Market Street, Suite 1600 Wilmington, DE 19801
TRUSTEE ADMINISTRATION NOTES
FOR TRUSTEE USE ONLY — NOT PART OF BENEFICIARY NOTICE
CONFIDENTIAL — INTERNAL ADMINISTRATION DOCUMENT This page and all information contained herein is for the sole use of Northgate Trust Company of Delaware in its capacity as Trustee of the Caldwell Family Insurance Trust. This page must not be sent to or shared with any beneficiary of the Trust. It is to be retained in the Trust's permanent administration file.
1. Distribution of Notices
This Notice of Withdrawal Right must be sent separately to each of the three (3) designated Crummey beneficiaries of the Trust promptly upon each contribution by the Grantor to the Trust. The three designated Crummey beneficiaries are:
(a) Thomas R. Caldwell, 55 Perry Street, Unit 3, New York, NY 10014
(b) Katherine C. Hartfield, 210 Briarcliff Lane, Greenwich, CT 06830
(c) Olivia G. Caldwell, 1240 North Dearborn Street, Apt. 807, Chicago, IL 60610
Each notice must be individually addressed, dated, and executed by the Trustee's authorized officer before mailing.
2. Annual Premium Information
The annual premium on the second-to-die universal life insurance policy issued by Beacon Life Assurance Company, Policy No. BLA-2023-77419, is One Hundred Eighty-Seven Thousand Five Hundred Dollars ($187,500). The Grantor is expected to contribute this amount (or such greater or lesser amount as may be required) to the Trust annually to fund the premium payment. The contribution amount stated in each year's notice should reflect the actual amount contributed by the Grantor for that year.
3. Method of Delivery
All Crummey notices must be sent via one of the following methods to preserve evidence of timely delivery:
(a) Certified mail, return receipt requested (U.S. Postal Service), with a copy of the certified mail receipt and the return receipt (green card) retained in the Trust administration file; or
(b) Overnight delivery with tracking (e.g., Severin Partners LLC, Halcyon Partners LLC, Tarrant & Co.), with a copy of the tracking confirmation and delivery receipt retained in the Trust administration file.
Do not send Crummey notices by regular first-class mail. Proof of delivery is essential in the event of an IRS audit or challenge to the qualification of the Grantor's contributions as present-interest gifts under IRC § 2503(b).
4. Record Retention
Retain copies of all of the following documents in the Trust's permanent administration file:
• A copy of each completed and executed Crummey notice sent to each beneficiary for each year
• All certified mail receipts, return receipts (green cards), overnight delivery tracking records, and delivery confirmations
• All signed Acknowledgments of Receipt returned by beneficiaries
• Any written withdrawal requests received from any beneficiary, together with documentation of any distributions made in response thereto
• Correspondence with counsel and the Grantor regarding the annual contribution and Crummey notice process
5. Insurance Brokerage Coordination
The Trustee should coordinate with the Trust's insurance broker regarding the timing of premium payments each year:
Glenmore Insurance Brokerage LLC
Attn: Nathan C. Freed, Senior Vice President, Private Client Division
44 Wall Street, Suite 1200 New York, NY 10005
Mr. Freed should be contacted annually to confirm the premium payment due date and to coordinate the timing of the Grantor's contribution, the Crummey notice period, and the premium remittance. The Trustee should request written confirmation from Glenmore of the exact premium due date and any applicable grace periods for each policy year.
6. Coordination with Grantor's Counsel
The annual Crummey notice process is coordinated with the ILIT Annual Premium Funding Letter sent by Calderwood & Harkness LLP (Sylvia Hartwell, Specialist Partner, Tax; Matter No. 1034-00004) to Jonathan R. Caldwell each year. The Annual Premium Funding Letter advises the Grantor of the required contribution amount and the allocation of the contribution among the federal gift tax annual exclusion and lifetime exemption, as follows:
The Trustee should confirm receipt of the Grantor's contribution each year and should promptly notify Calderwood & Harkness LLP upon the issuance of the Crummey notices and again upon the expiration of the Withdrawal Period (or upon receipt of any withdrawal request from a beneficiary).
7. Calendar Reminder — Timing of Notices
Critical Timing Requirement: Upon receipt of the Grantor's contribution each year, the Trustee must send the Crummey notices immediately — on the same business day or, at the latest, the following business day.
The thirty (30) calendar day Withdrawal Period must begin and, ideally, expire before the premium payment due date on the Policy, so that the contributed funds are available for premium payment after the Withdrawal Period has run. If this is not feasible due to the timing of the Grantor's contribution, the Trustee should ensure that:
(a) The Grantor's contribution is made sufficiently in advance of the premium due date to allow for the full thirty (30) calendar day Withdrawal Period; and
(b) The Trustee coordinates with Glenmore Insurance Brokerage LLC to confirm any applicable grace period on the Policy that may allow additional time for premium payment.
If there is any concern that the Withdrawal Period will not expire before the premium due date, the Trustee should consult with Calderwood & Harkness LLP before remitting the premium payment.
8. Gift Tax Reporting
The lapse of the Crummey withdrawal rights should be reported on the Grantor's annual federal gift tax return (IRS Form 709). The Grantor's gift tax return is prepared in coordination with:
Tax Return Preparation: Strathmore Corporation & Greaves LLP
Attn: Martin J. Prescott, CPA
600 Third Avenue, 28th Floor New York, NY 10016
Gift Tax Counsel: Calderwood & Harkness LLP
Attn: Sylvia Hartwell, Specialist Partner, Tax
375 Park Avenue, 42nd Floor New York, NY 10152
The Trustee should provide Mr. Prescott and Ms. Hartwell with copies of all Crummey notices, delivery receipts, and beneficiary acknowledgments promptly after the expiration of the Withdrawal Period each year. This documentation will be used to support the annual exclusion and lifetime exemption positions taken on the Grantor's Form 709.
The Trustee should also confirm, at the time the Form 709 is being prepared, that each beneficiary's lapse amount ($5,000) falls within the greater-of-$5,000-or-5% safe harbor under IRC § 2514(e), taking into account the then-current aggregate value of the Trust assets.
9. Minor Beneficiary Considerations
If any Crummey beneficiary is a minor (under the age of eighteen (18) under Delaware law), the Crummey notice should be sent to the beneficiary's legal guardian at the guardian's address. The Trustee should confirm the identity and address of any guardian and retain a copy of the guardianship documentation in the Trust administration file. Any withdrawal request submitted on behalf of a minor beneficiary must be signed by the legal guardian, together with satisfactory evidence of guardianship.
As of the date of preparation of this form, all three designated Crummey beneficiaries are believed to be adults. The Trustee should verify the ages of all beneficiaries annually and update procedures if any beneficiary becomes incapacitated or if a new minor beneficiary is added to the Trust.
End of Trustee Administration Notes — Not Part of Beneficiary Notice
Prepared for use by Northgate Trust Company of Delaware Caldwell Family Insurance Trust — Established March 15, 2023 Calderwood & Harkness LLP — Matter No. 1034-00004
| Allocation | Amount |
| Annual Exclusion ($17,000 × 3 beneficiaries) | $51,000 |
| Lifetime Exemption Usage | $136,500 |
| Total Annual Premium / Contribution | $187,500 |