EXHIBIT 10.25
TRUST UNDER LKQ CORPORATION 401(k) PLUS PLAN
THIS AGREEMENT made as of April 7, 2000, by and among LKQ
Corporation, a corporation organized under the laws of the State of Delaware or
any successor corporation (the "Company") and LaSalle Bank National Association,
a national banking association (the "Trustee").
WITNESSETH:
WHEREAS, the Company has adopted the LKQ Corporation 401(k) Plus Plan
(the "Plan").
WHEREAS, the Company has incurred or expects to incur liability under
the terms of such Plan with respect to the individuals participating in such
Plan (the "Participants"); and
WHEREAS, Company wishes to establish a trust (hereinafter called
"Trust") and to contribute to the Trust assets that shall be held therein,
subject to the claims of the Company's creditors in the event of the Company's
Insolvency, as herein defined, until paid to Participants and their
beneficiaries in such manner and at such times as specified in the Plan;
WHEREAS, it is the intention of the parties that this Trust shall
constitute an unfunded arrangement and shall not affect the status of the Plan
as an unfunded plan maintained for the purpose of providing deferred
compensation for a select group of management or highly compensated employees
for purposes of Title I of the Employee Retirement Income Security Act of 1974,
and shall not be construed to provide income for federal income tax purposes to
a Participant for his or her beneficiary prior to the actual payment of benefits
under the Plan; and
WHEREAS, it is the intention of the Company to make contributions to
the Trust to provide itself with a source of funds to assist it in the meeting
of its liabilities under the Plan;
NOW, THEREFORE, the parties do hereby establish the Trust and agree
that the Trust shall be comprised, held and disposed of as follows:
ARTICLE I: ESTABLISHMENT OF TRUST
1.1 The Trustee shall receive any contributions paid to it in cash or
in other property acceptable to it, which shall from time to time be transferred
to the Trustee by the Company. All contributions so received together with the
income therefrom and any other increment thereon (the "Trust Fund") shall be
held, managed and administered by the Trustee pursuant to the terms of this
Agreement. The amount of contributions by the Company to the Trust Fund shall be
determined in accordance with the provisions of Section 1.5 hereof, and the
Trustee shall have no duty or responsibility with respect thereto.
1.2 The Trust hereby established shall be irrevocable.
1.3 The Trust is intended to be a grantor trust, of which the Company
is the grantor, within the meaning of subpart E, part I, subchapter J, chapter
1, subtitle A of the Internal Revenue Code of 1986, as amended, and shall be
construed accordingly.
1.4 The principal of the Trust, and any earnings thereon shall be held
separate and apart from other funds of the Company and shall be used exclusively
for the uses and purposes of Participants and general creditors as herein set
forth. Participants and their beneficiaries shall have no preferred claim on, or
any beneficial ownership interest in, any assets of the Trust. Any rights
created under the Plan and this Trust Agreement shall be mere unsecured
contractual rights of Participants and their beneficiaries against the Company.
Any assets held by the Trust will be subject to the claims of the Company's
general creditors under federal and state law in the event of Insolvency, as
defined in Section 4.1 herein.
1.5 The Company shall pay to the Trustee such amount as may be
considered appropriate to provide for the payment of benefits under the Plan and
the expenses of administration of the Trust.
1.6 A "Change of Control" shall mean any transaction or event
designated as such by the Plan committee. Upon a Change of Control, the Company
shall, as soon as possible, but in no event later than fifteen (15) calendar
days following the Change in Control, make an irrevocable contribution to the
Trust in an amount that is sufficient to pay each Plan participant or
beneficiary the benefits to which the Plan Participants or their beneficiaries
would be entitled pursuant to the terms of the Plan as of the date on which the
Change in Control occurred. The Plan committee and the Plan participants, but
not the Trustee, shall have the right to compel such contribution.
ARTICLE II: PAYMENTS TO PLAN PARTICIPANTS
AND THEIR BENEFICIARIES
2.1 The Trustee shall from time to time, upon the direction of the
Company, make distributions or payments out of the Trust Fund, to such persons,
in such manner and in such amounts as the Company shall deem necessary to
satisfy its obligation to provide benefits under the Plan. The Trustee shall not
be liable for the proper application of any part of the Trust Fund and shall not
be liable for any distribution made in good faith without actual notice or
knowledge of the changed status or condition of any recipient.
2.2 Any amount paid to a Participant or beneficiary under this Article
II shall be reduced by the amount of taxes required to be withheld pursuant to
written instructions from the Company. The Trustee shall pay to the Company a
sum equal to the amount of such taxes as are required to be withheld, whereupon
the Company shall have sole responsibility for the payment of all withholding
taxes to the appropriate taxing authorities. The Company shall also have sole
responsibility for any withholding related filings or reports.
2.3 Nothing in this Agreement shall relieve the Company of its
liabilities to pay the benefits provided under the Plan except to the extent
such liabilities are met by the application of Trust Fund assets.
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2.4 The entitlement of a Participant or his or her beneficiaries to
benefits under the Plan shall be determined by the Company or such party as it
shall designate under the Plan, and any claim for such benefits shall be
considered and reviewed under the procedures set forth in the Plan.
2.5 The Company may make payment of benefits directly to
Participants or their beneficiaries as they become due under the terms of the
Plan. The Company shall notify the Trustee of its decision to make payment of
benefits directly prior to the time amounts are payable to the Participants or
their beneficiaries. In addition, if the principal of the Trust, and any
earnings thereon, are not sufficient to make payments of benefits in accordance
with the terms of the Plan, the Company shall make the balance of each such
payment as it becomes due. The Trustee shall notify the Company where principal
and earnings are not sufficient.
2.6 In the event of a "failure to pay", the Trustee shall make
distributions or payments out of the Trust Fund, to such persons, and in such
amounts to satisfy the Company's obligation to provide benefits under the Plan
if the following two conditions are met:
(a) A Participant/Beneficiary sends a notice to both the
Trustee and the Company at the same time, indicating that the Company failed to
pay the Participant/Beneficiary when due, and that such amount remains unpaid.
(b) The Trustee does not receive a written objection from the
Company within sixty (60) calendar days indicating that the named
Participant/Beneficiary is not owed any benefit payments according to the terms
of the Plan.
ARTICLE III: TRUSTEE POWERS
3.1 Subject to investment guidelines which may be issued by the Company
to the Trustee from time to time, the Trustee shall have the following powers
and authority in the administration of the Trust Fund:
(a) To invest and reinvest the Trust Fund without distinction
between principal and income in any kind of property, real, personal or mixed,
tangible or intangible, and in any kind of investment, security or obligation,
including any common trust fund, group trust, pooled fund or other commingled
investment fund maintained by the Trustee or any other bank or entity for trust
investment purposes;
(b) To sell for cash or on credit, to grant options, convert,
redeem, exchange for other securities or other property, or otherwise to dispose
of any securities or other property at any time held;
(c) To settle, compromise, contest, prosecute, abandon or
submit to arbitration, any claims, debts or damages, due or owing to or from the
Trust;
(d) To exercise any conversion privilege and/or subscription
right available in connection with any securities or other property at any time
held; to oppose or to consent to the reorganization, consolidation, merger, or
readjustment of the finances of any corporation,
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company or association or to the sale, mortgage, pledge or lease of the property
of any corporation, company or association any of the securities of which may at
any time be held and to do any act with reference thereto, including the
exercise of options, the making of agreements or subscriptions, which may be
deemed necessary or advisable in connection therewith, and to hold and retain
any securities or other property so acquired;
(e) To exercise, personally or by general or by limited power
of attorney, any right, including the right to vote, appurtenant to any
securities or other property held at any time;
(f) To borrow money from any lender in such amounts and upon
such terms and conditions as shall be deemed advisable or proper to carry out
the purposes of the Trust and to pledge any securities or other property for the
repayment of any such loan;
(g) To hold cash uninvested for a reasonable period of time
under the circumstances without liability for interest, pending investment
thereof or the payment of expenses or making distributions therewith;
(h) To form corporations and to create trusts to hold title to
any securities or other property all upon such terms and conditions as may be
deemed advisable;
(i) To employ suitable agents and counsel and to pay their
reasonable expenses and compensation;
(j) To register any securities held hereunder in the name of
the Trustee or in the name of a nominee with or without the addition of words
indicating that such securities are held in a fiduciary capacity and to hold any
securities in bearer form;
(k) To stop making payments to Participants or beneficiaries
and hold Trust Fund assets for the benefit of the creditors of the Company and
to deliver assets to satisfy such creditor's claims as directed by a regulatory
agency or court of competent jurisdiction, all pursuant to Article IV below; and
(l) To make, execute and deliver, as Trustee, any and all
conveyances, contracts, waivers, releases or other instruments in writing
necessary or proper for the accomplishment of any of the foregoing powers.
3.2 The Trustee shall purchase or continue in effect such
insurance contracts, including annuity contracts and policies of life insurance,
as the Company shall direct, and the Trustee shall act with respect to those
contracts only as directed by the Company and shall have no investment
responsibility for such contracts.
ARTICLE IV: TRUSTEE RESPONSIBILITY REGARDING PAYMENTS TO TRUST
BENEFICIARY WHEN COMPANY IS INSOLVENT
4.1 The Trustee shall cease payment of benefits to Participants and
their beneficiaries if the Company is Insolvent. The Company shall be considered
"Insolvent" for purposes of this Trust Agreement if (i) the Company is unable to
pay its debts as they become due, or (ii) the
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Company is subject to a pending proceeding as a debtor under the United States
Bankruptcy Code.
4.2 At all times during the continuance of this Trust, as provided in
Section 1.4 hereof, the principal and income of the Trust shall be subject to
claims of general creditors of the Company under federal and state law as set
forth below.
(a) The Board of Directors and the President of the Company
shall have the fiduciary duty and responsibility on behalf of the general
creditors of the Company to inform the Trustee promptly in writing of the
Company's Insolvency, and the Trustee shall have the right to rely thereon to
the exclusion of all directions or claims for payment made thereafter by
Participants. If a person claiming to be a creditor of the Company alleges in
writing to the Trustee that the Company has become Insolvent, the Trustee's only
duty of inquiry shall be to request that the Company's independent public
accountants determine whether the Company is Insolvent and, pending such
determination, Trustee shall discontinue payment of benefits to Participants or
their beneficiaries.
(b) Unless the Trustee has actual knowledge of the Company's
Insolvency, or has received notice from the Company or a person claiming to be a
creditor alleging that the Company is insolvent, the Trustee shall have no duty
to inquire whether the Company is Insolvent. The Trustee may in all events rely
on such evidence and determination concerning the Company's solvency as may be
furnished to the Trustee by the Company's independent public accountants.
(c) If at any time the Company's independent public
accountants have determined that the Company is Insolvent, the Trustee shall
discontinue payments to Participants or their beneficiaries and shall hold the
assets of the Trust for the benefit of the Company's general creditors. Nothing
in this Trust Agreement shall in any way diminish any rights of Participants or
their beneficiaries to pursue their rights as general creditors of the Company
with respect to benefits due under the Plan or otherwise.
(d) The Trustee shall resume the payment of benefits to
Participants or their beneficiaries in accordance with Article II of this Trust
Agreement only after the Company's independent public accountants have
determined that the Company is not insolvent (or is no longer Insolvent).
4.3 Provided that there are sufficient assets, if the Trustee
discontinues the payment of benefits from the Trust pursuant to Section 4.3
hereof and subsequently resumes such payments, the first payment following such
discontinuance shall include the aggregate amount of all payments due to
Participants or their beneficiaries under the terms of the Plan for the period
of such discontinuance, less the aggregate amount of any payments made to
Participants or their beneficiaries by the Company in lieu of the payments
provided for hereunder during any such period of discontinuance.
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4.4 Participants and beneficiaries have only the Company's unsecured
promise to pay benefits under the terms of the Plan and the status of an
unsecured general creditor of the Company. Participants and beneficiaries
receive and have no security interest in assets of the Trust.
ARTICLE V: MISCELLANEOUS
5.1 The Trustee shall be paid such reasonable compensation as shall
from time to time be agreed upon by the Company and the Trustee. Such
compensation and all expenses of administration of the Trust, including
attorneys' fees, shall be withdrawn by the Trustee out of the Trust Fund unless
paid by the Company.
5.2 The Trustee shall keep accurate and detailed accounts of all
investments, receipts, disbursements and other transactions hereunder, and all
accounts, books and records relating thereto shall be open to inspection and
audit at all reasonable times by any person designated by the Company. Within 60
days after the close of each fiscal year (or such other date as may be agreed
upon in writing between the Company and the Trustee), and within 60 days after
the effective date of the resignation of the Trustee as provided in Section 5.3
hereof; the Trustee shall file with the Company a written account setting forth
all investments, receipts, disbursements and other transactions effected by it
during the year ending on such date (but not including any part of such year for
which such an account has previously been filed) and certified as to the
accuracy of the information set forth therein. Such account may incorporate by
reference any and all schedules and other statements setting forth investments,
receipts, disbursements and other transactions effected during the period for
which such account is rendered which the Trustee has furnished to the Company
prior to the filing of such account. Each account so filed (and copies of any
schedules and statements incorporated therein by reference as aforesaid) shall
be open to inspection during business hours by any Participant and any person
designated by such Participant for a period of 60 days immediately following the
date on which the account is filed with the Company. The Company may approve
such accounts by an instrument in writing delivered to the Trustee. In the
absence of the filing in writing with the Trustee by the Company of exceptions
or objections to any such account within 90 days, the Company shall be deemed to
have approved such account; and in such case, or upon the written approval of
the Company of any such account, the Trustee shall be released, relieved and
discharged with respect to all maters and things set forth in such account as
though such account had been settled by the decree of a court of competent
jurisdiction.
5.3 The Trustee shall be fully protected in relying upon a
certification of an authorized representative of the Company with respect to any
instruction, direction or approval of the Company, and protected also in relying
upon the certification until a subsequent certification is filed with the
Trustee.
5.4 The Trustee shall be fully protected in acting upon any instrument,
certificate, or paper believed by it to be genuine and to be signed or presented
by the proper person or persons, and the Trustee shall be under no duty to make
any investigation or inquiry as to any statement contained in any such writing
but may accept the same as conclusive evidence of the truth and accuracy of the
statements therein contained.
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5.5 All persons dealing with the Trustee are released from inquiry into
the decision or authority of the Trustee and from seeing to the application of
any moneys, securities or other property paid or delivered to the Trustee.
5.6 The Trustee shall not be liable hereunder for any loss or
diminution of the Trust Fund resulting from any action taken or omitted, except
to the extent that any such loss or diminution was the direct result of the
Trustee's gross negligence or willful misconduct in the performance of its
responsibilities hereunder. The Company shall indemnify the Trustee and defend
it and hold it harmless from and against any and all costs, expenses and
liabilities arising out of or in connection with the performance of the
Trustee's duties arising hereunder (but excluding costs arising from the
Trustee's gross negligence or willful misconduct in the performance of its
responsibilities hereunder). If the Company does not pay such costs, expenses
and liabilities in a reasonably timely manner, Trustee may obtain payment from
the Trust. This Section shall survive the termination of this Agreement.
5.7 Notwithstanding any other provision of this Trust to the contrary,
the Trustee does not guarantee payment of any amount which may become due and
payable to a Participant or his or her beneficiary. The Trustee shall have no
responsibility for the disclosure to Participants regarding the terms of the
Plan or of this Trust, or for the validity thereof. The Trustee shall not be
responsible for administrative functions under the Plan and shall have only such
responsibilities under this Trust Agreement as are specifically set forth
herein. The Trustee will be under no obligation or liability to anyone with
respect to any failure on the part of the Company, the Plan or the Company's
independent public accounting firm or any Participant to perform any of their
respective obligations under the Plan or this Trust. Nothing in this Trust shall
be construed as requiring the Trustee to make any payment in excess of the
amounts held in the Trust Fund at the time of such payment or otherwise to risk
or expend its own funds.
5.9 The Trustee acting hereunder may resign at any time by giving at
least 30 days written notice to the Company. In the case of the resignation of
the Trustee the Company shall appoint a successor Trustee, which shall be a bank
or trust company. Any successor Trustee shall have the sane obligations, powers
and duties as those conferred upon the Trustee hereunder and the appointment of
a new Trustee shall be by a written instrument delivered to the Trustee acting
hereunder. Upon receipt of such written instrument executed by the Company and a
written instrument executed by the successor Trustee accepting the appointment.
The Trustee shall deliver the assets of the Trust Fund to the successor Trustee
but may reserve such reasonable amount as the Trustee may be necessary for
outstanding and accrued charges against the Trust Fund.
5.9 This Agreement and the Trust created hereby shall be irrevocable;
provided, however, that any property held in the Trust Fund shall be subject to
the claims of general creditors of the Company under Federal or state law in the
event of Insolvency. In the event that the Company certifies to the Trustee that
the Plan is terminated and there are no remaining Participants or beneficiaries
entitled to benefits thereunder, this Trust shall terminate and, subject to the
Trustee's right to reserve such reasonable amount as it may deem necessary for
outstanding and accrued charges against the Trust Fund, title to any remaining
assets shall revert to the Company.
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5.10 This Agreement and the Trust created herein shall be construed,
regulated and administered under the laws of the State of Illinois and of the
United States. All contributions to the Trustee shall be deemed to take place in
the State of Illinois. The Trustee may at any time initiate an action or
proceeding for the settlement of its accounts or for the determination of any
question of construction which may arise or for instructions, and the only
necessary party defendant to such action shall he the Company, except that the
Trustee may, if it so elects, bring in as parties defendant any outer person or
persons.
5.11 This Agreement may not be amended in any respect without the
consent of the Company, Trustee and affected Participants, and no amendment
shall reduce a Participant's benefits to less than the amount he would be
entitled to receive on the date before the amendment.
5.12 This Agreement shall be executed in any number of counterparts,
each one of which shall be deemed to be the original although the others shall
not be produced.
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IN WITNESS WHEREOF, this instrument has been executed as of the day and
year first above written.
COMPANY:
LKQ CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------
Its: Vice President
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TRUSTEE:
LaSALLE BANK NATIONAL ASSOCIATION
By: /s/ Xxxxx Xxxxxxx
-----------------------------
Its: Vice President
-----------------------------
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