In May 2000, CIRI adopted an Elders’ Benefit Program to pay $450 quarterly payments through a revocable trust to original CIRI enrollees who were 65 years of age or older and alive on the distribution date of record. Subsequently, in 2003, CIRI shareholders approved the creation of CIRI’s Irrevocable Elders’ Settlement Trust (Elders’ Trust), which substantially replaced the Benefit Program. The Elders’ Trust was established shortly thereafter with $16 million the CIRI Board of Directors had set aside for that purpose. Because the Elders’ Trust was irrevocable, it could not be discontinued until the money was reduced to zero, nor could the proceeds be withdrawn by CIRI for any reason.
The Elders’ Trust mandated $450 quarterly distributions per eligible Elder so long as the Trust had assets available to make distributions. Original shareholders who were 65 years of age or older, alive on the distribution date of record and owned at least one share of CIRI stock were eligible to receive Elders’ Trust payments. Because a small group of original shareholders who had been eligible to receive Elders’ Benefit payments had gifted all of their CIRI shares away prior to the establishment of the Elders’ Trust, they were not eligible to receive Elders’ Trust payments. Consequently, the CIRI Board voted to continue the Elders’ Benefit Program for eligible Elders who had gifted all of their CIRI shares away on or before July 31, 2003.
At the time of establishment, it was anticipated that the Elders’ Trust would last for approximately 20 years, or until 2023. However, the 2008 global economic downturn on investments and the fact that shareholders are (thankfully) living longer than anticipated caused the funding to run out during 2019, with the CIRI Board approving that CIRI provide the necessary funding to cover the shortfall and ensure that all eligible Elders received full payments in 2019.
In June 2019, CIRI shareholders voted to approve the creation of the CIRI Settlement Trust (CST), and the CST was established shortly thereafter. Like the Elders’ Trust, the CST is irrevocable. Beginning in 2020, the CIRI Board of Directors authorized CIRI to contribute funds to the CST to permit the CST to distribute $450 to eligible Elders on a quarterly basis. In turn, the CST Trustees agreed to accept the contributions and pay the amounts to eligible beneficiaries, adopting an Elders Fund charter for this purpose.
The beneficiaries the CST Elders Fund are those beneficiaries of the CST who: (i) are living individuals; (ii) are 65 years old or older; (iii) are original CIRI shareholders; and (iv) either own at least one share of CIRI Common Stock or gifted all of their CIRI Common Stock to family members before July 31, 2003. Shareholders are encouraged to carefully consider the latter requirement before deciding to make a stock gift, and to keep at least one share if they wish to receive Elders Fund payments.
Eligible shareholders who are turning 65 and want to receive payments from the CST Elders Fund do not need to do anything other than to keep a current mailing address on file with CIRI Shareholder Relations and, if they wish to have their payments directly deposited, maintaining up-to-date direct deposit information with Shareholder Relations. Because receiving Elders Fund payments may cause some Elders to exceed income or asset limits for certain federal or federally-assisted welfare programs, Elders may “opt out” of receiving the payments by completing an Opt-Out Form. Provided they still meet the eligibility requirements those who opt-out may later opt back in, but they are not eligible to receive missed back payments.
The Elders’ Trust payment schedule is determined by the CST Trustees on an annual basis and is posted in the Qenek shareholder portal. Deadlines and information relative to current distributions are announced in the Raven’s Circle newsletter, on this website and on the dividend hotline at 263-5100 or toll-free at 800-764-2435. Payment dates are typically set for the second Fridays of March, June, September and December, the same months as quarterly distribution payments. This schedule reduces the number of months that some Elders lose their SSI payments because of monthly income limitations set by the Social Security Administration.
Neither CIRI nor the CST withhold taxes from distributions; however, those who anticipate owing tax on their distributions have the option of making quarterly estimated tax payments directly to the Internal Revenue Service themselves. To learn more about applicable federal and state tax requirements or making quarterly estimated tax payments, please consult with a tax advisor or contact the IRS directly. As a reminder, distributions made by the CST are expected to be tax-free to beneficiaries in most cases.