Exhibit 10.6
ROTECH HEALTHCARE INC. EMPLOYEES PLAN TRUST
This Trust Agreement made this 26th day of March, 2002 by and between
ROTECH HEALTHCARE INC., a corporation organized under the laws of the State of
Delaware (hereinafter referred to as the "Company") and Xxxxx Zivmek and Xxxxx
Novell (hereinafter referred to as the "Trustees" and each individually, a
"Trustee").
W I T N E S S E T H:
WHEREAS, the Company adopted the ROTECH HEALTHCARE INC. EMPLOYEES PLAN (the
"Plan") effective as of March 26, 2002; and
WHEREAS, the Company desires to enter into a Trust Agreement for the Plan
with the Trustees; and
WHEREAS, the Company is the Plan Administrator of the Plan; and
WHEREAS, the Plan is intended to constitute an eligible individual account
plan within the meaning of Section 407(d)(3) of the Employee Retirement Income
Security Act of 1974, as amended from time to time ("ERISA"), pursuant to which
the Plan may hold stock of the Company without regard to the diversification
requirements of Section 404 of ERISA; and
WHEREAS, the terms defined in the Plan shall have the same meaning in this
Trust Agreement and references in this Trust Agreement to the "Plan
Administrator" shall include delegates of the Plan Administrator.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, the Company and the Trustees do hereby covenant and
agree as follows:
FIRST: The Trustees shall receive any contributions paid to them, pursuant
to the terms of the Plan, in cash or in other property acceptable to them,
including Company Stock, either from the Company or any Employer that has
adopted the Plan and such amounts shall be held pursuant to the terms of the
Plan. All contributions so received, together with the income therefrom and any
other increment thereon (hereinafter referred to as the "Trust Fund"), shall be
held, managed and administered by the Trustees pursuant to the terms of this
Trust Agreement, without distinction between principal and
income and without liability for the payment of interest thereon. The Trustees
shall not be responsible for the collection of any contributions to the Plan.
SECOND: Subject to the provisions of Article THIRD hereof, the Trustees
shall, from time to time on the written directions of the Plan Administrator,
make distributions out of the Trust Fund to such persons, including any of the
Trustees, in such manner, in such amounts, and for such purposes as may be
specified in the directions of the Plan Administrator.
The Trustees shall be under no liability for any distribution made by them
pursuant to a written direction of the Plan Administrator and shall be under no
duty to make inquiries as to whether any distribution directed by the Plan
Administrator is made pursuant to the provisions of the Plan.
THIRD: (A) Notwithstanding anything to the contrary contained in this Trust
Agreement, or in any amendment thereto, but subject to the provisions of
paragraph (B), it shall be impossible for any part of the Trust Fund, other than
such part as is required to pay taxes and administration expenses, to be used
for, or diverted to, purposes other than for the exclusive benefit of the
Members under the Plan and their Beneficiaries (including alternate payees under
a qualified domestic relations order as defined in Section 414(p) of the Code).
(B) In the event that the Plan Administrator shall direct the return
to the Company or any Employer of any contribution to the Trust Fund and shall
certify with respect to such contribution that (i) such contribution has been
made by the Company or an Employer by a mistake of fact or (ii) such
contribution has been conditioned upon the deductibility thereof under Section
404 of the Code and it has been determined that such contribution is not
deductible, the Trustees shall return such contribution (or the value thereof,
if less) to the Company or the Employer that made such contribution, but in no
event shall any such return be made later than the expiration of one year
following the payment of any such contribution, in the case of a direction under
(i) above, or the determination of the non-deductibility of a contribution, in
the case of a direction under (ii) above.
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(C) In making a distribution upon a written direction, as authorized
herein, the Trustees may accept such direction as a certification that such
payment complies with the provisions of this Article and need make no further
investigation.
FOURTH: The Trustees shall have the following powers and authority in the
administration of the Trust Fund, to be exercised as provided in Article FIFTH
hereof.
(A) To purchase, receive or subscribe for any securities or other
property and to retain in trust such securities or other property.
(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 by the Trust Fund.
(C) To settle, compromise or submit to arbitration, any claims, debts
or damages, due or owing to or from the Trust Fund; to commence or defend suits
or legal proceedings and to represent the Trust Fund in all suits or legal
proceedings.
(D) To exercise any conversion privilege and/or subscription right
available in connection with any securities or other property at any time held
by the Trust Fund; to oppose or to consent to the reorganization, consolidation,
merger, or readjustment of the finances of any corporation, company or
association or to the sale, mortgage, pledge or lease of the property of any
corporation, company or association or any of the securities of which may at any
time be held by the Trust Fund and to do any act with reference thereto,
including the exercise of options, the making of agreements or subscriptions and
the payment of expenses, assessments or subscriptions, which may be deemed
necessary or advisable in connection therewith, and to hold and retain any
securities or other property which the Trust Fund may so acquire.
(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 by the Trust Fund 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 Fund and to pledge any securities or other property for
the repayment of any such loan.
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(G) To manage, administer, operate, lease for any number of years
(regardless of any restrictions on leases made by fiduciaries), develop,
improve, repair, alter, demolish, mortgage, pledge, grant options with respect
to, or otherwise deal with any real property or interest therein at any time
held by the Trust Fund, and to hold any such real property in the name of the
Trustees or in the name of a nominee, with the addition of words indicating that
such property is held in a fiduciary capacity, and to cause to be formed a
corporation or trust to hold title to any such real property with the aforesaid
powers, all upon such terms and conditions as may be deemed advisable.
(H) To renew or extend or participate in the renewal or extension of
any mortgage, upon such terms as may be deemed advisable, and to agree to a
reduction in the rate of interest on any mortgage or to any other modification
or change in the terms of any mortgage or of any guarantee pertaining thereto,
in any manner and to any extent that may be deemed advisable for the protection
of the Trust Fund or the preservation of the value of the investment; to waive
any default whether in the performance of any covenant or condition of any
mortgage or in the performance of any guarantee, or to enforce any such default
in such manner and to such extent as may be deemed advisable; to exercise and
enforce any and all rights of foreclosure, to bid on property in foreclosure, to
take a deed in lieu of foreclosure with or without paying a consideration and,
in connection therewith, to release the obligation on the bond secured by such
mortgage, and to exercise and enforce in any action, suit or proceedings, at law
or in equity, any rights or remedies in respect of any such mortgage or
guarantee.
(I) To hold part or all of the Trust Fund uninvested and to keep any
portion of the Trust Fund in cash or cash balances, as the Trustees may from
time to time require for the administration of the Trust Fund, in the Trustees'
best judgment.
(J) To employ suitable agents and counsel, including counsel who may
be counsel for the Company and to pay their reasonable expenses and
compensation.
(K) To register any securities held hereunder in the name of the
Trustees 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.
(L) 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.
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(M) To appoint a bank or trust company as custodian to hold the assets
of the Trust Fund.
(N) To make, execute and deliver as Trustees, any and all deeds,
leases, mortgages, conveyances, contracts, waivers, releases or other
instruments in writing, necessary or proper for the accomplishment of any of the
foregoing powers.
(O) To transfer, at any time and from time to time, such part or all
of the Trust Fund as it shall deem advisable to any group trust (or separate
account of an insurance company) which has been qualified under Section 401 (a)
of the Code and is exempt from tax under Section 501 (a) of the Code, maintained
by any bank (including a bank trustee serving hereunder, if any), insurance
company, trust company or any other entity or persons, as a medium for the
collective investment of funds of pension, profit-sharing or other employee
benefit trusts and to withdraw any part or all of the Trust Fund so transferred.
The provisions of any such trust shall be deemed a part of this Trust Agreement.
(P) To hold qualifying employer securities as defined under Section
407(d)(5) of ERISA, without limitation.
FIFTH: The powers listed in Article FOURTH hereof shall be exercised by the
Trustee, except in the event an Investment Manager (as such term is defined in
Article EIGHTEENTH hereof) is appointed by the Plan Administrator in accordance
with the provisions of Article EIGHTEENTH hereof, in which event such powers
shall be exercised as directed by the Investment Manager, to the extent such
powers are delegated to the Investment Manager.
SIXTH: The Trustees shall have the responsibility and the following powers
and authority, to be exercised in their sole discretion in accordance with the
fiduciary standards of ERISA:
(A) To arrange for the custody and safekeeping over all securities and
other property in the Trust Fund.
(B) To timely collect dividends, interest, rents, royalties and other
forms of income on securities or other properties held in the Trust Fund which
shall be held and reinvested pursuant to the provisions of paragraph (A) of
Article FOURTH.
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(C) To register any security or other property held by them hereunder
in their own names, in the name of a title holding company exempt from tax under
Section 501(c)(2) of the Code, or in the name of a nominee, with or without the
addition of words indicating that such securities or other property are held in
a fiduciary capacity and to hold any securities in bearer form and to deposit
any securities or other property in a depository or a clearing corporation;
provided that the requirement under Section 403 of ERISA that all assets of the
Plan be held in trust is not violated. No such holding shall relieve the
Trustees of their responsibility for the safe custody and disposition of the
Trust Fund in accordance with the provisions of this Trust Agreement.
(D) To make, execute and deliver, as Trustees, any and all deeds,
leases, mortgages, conveyances, waivers, releases or other instruments in
writing, necessary or desirable for the accomplishment of any of the powers
listed in this Article SIXTH.
(E) To employ suitable agents and counsel and to pay their reasonable
and proper expenses and compensation, to the extent not paid by an Employer.
(F) To perform all acts, whether or not expressly authorized, that a
prudent fiduciary under ERISA would perform for the protection and safekeeping
of the Trust Fund.
SEVENTH: The words "securities or other property" as used in paragraph (A)
of Article FOURTH hereof shall be deemed to refer to any property, real or
personal or part interest therein, including but without being limited to,
governmental, corporate or personal obligations, trust and participation
certificates, leaseholds, fee titles, mortgages and other interests in realty,
preferred and common stocks, life insurance, disability insurance and group
annuity or insurance company investment or similar contracts (whether part of
the general account or separate account of an insurance company), and any other
evidences of indebtedness or ownership, including securities or other property
of the Company, to the extent not prohibited by ERISA.
EIGHTH: The Trustees shall pay out of the Trust Fund all real and personal
property taxes, income taxes and other taxes of any and all kinds levied or
assessed under existing or future laws against the Trust Fund, except a tax
imposed on the Trustees for participating in a prohibited transaction.
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The Trustees shall not receive any compensation for acting as trustees
under this Trust Agreement. All compensation and necessary and reasonable
expenses of administration of the Trust Fund and the Plan, including counsel
fees and reimbursement of expenses properly and actually incurred by the
Trustees, shall be withdrawn by the Trustees out of the Trust Fund, unless paid
by an Employer or any other person or entity authorized by an Employer to pay
some or all of the said amounts.
NINTH: The Trustees shall keep accurate and detailed accounts of all
investments, receipts, disbursements and other transactions hereunder for each
Plan, 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
Plan Administrator or the Company. Within one hundred twenty (120) days after
the close of each fiscal year of the Plan (or such other date or dates as may be
agreed upon in writing between the Company and the Trustees), the Trustees shall
cause to be filed with the Company a written account setting forth all
investments, receipts, disbursements and other transactions effected during the
said 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 Trustees have 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 the Plan Administrator and the Company, and
any person designated by the Plan Administrator and the Company for a period of
sixty (60) days immediately following the date on which the account is filed
with the Company. In the event that any assets of the Trust Fund have been
transferred to a group trust pursuant to Article FOURTH, paragraph (O) hereof,
such account shall include a copy of the latest annual written account of the
said collective trust. The Company may approve such account by an instrument in
writing delivered to the Trustees. Upon the written approval of the Company of
any such account, the Trustees shall be released, relieved and discharged with
respect to all matters and things set forth in such account as though such
account had been settled by a court of competent
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jurisdiction. In addition, the Trustees shall cause to be submitted to the
Company and the Plan Administrator such other and more frequent reports as the
Company and the Plan Administrator may reasonably request.
TENTH: The Trustees shall be fully protected in relying upon a
certification of the Plan Administrator with respect to any instruction,
direction or approval of the Plan Administrator.
The Trustees shall be fully protected in acting upon any instrument,
certificate, or document reasonably believed by him to be genuine and to be
signed or presented by the proper person or persons, and the Trustees 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.
The Trustees shall not be liable for the proper application of any part of
the Trust Fund if distributions are made in accordance with the written
directions of the Plan Administrator as herein provided, nor shall the Trustees
be responsible for the adequacy of the Trust Fund to meet and discharge any and
all distributions and liabilities under the Plan. All persons dealing with the
Trustees are released from inquiry into the decision or authority of the
Trustees and from seeing to the application of any moneys, securities, or other
property paid or delivered to the Trustees.
The Employers shall jointly and severally indemnify any individual Trustees
from and against any and all liabilities to which he or she may be subjected by
reason of any act or failure to act with respect to the Plan or this Trust
Agreement which constitutes a breach of fiduciary responsibility except that due
to such person's own gross negligence or willful misconduct. Nothing herein
shall prohibit an Employer from purchasing insurance to indemnify any Trustees
from such liability.
ELEVENTH: Notwithstanding any other provisions of this Trust Agreement, the
Trustees shall discharge his duties under this Trust Agreement in the interest
of the Members of the Plan and their Beneficiaries and (i) for the exclusive
purpose of providing benefits to such Members and their Beneficiaries and
defraying reasonable expenses of administering the Plan; (ii) with the care,
skill, prudence and diligence under the circumstances then prevailing that a
prudent man acting in like capacity and familiar
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with such matters would use in the conduct of an enterprise of like character
and with like aims and (iii) in accordance with the provisions of this Trust
Agreement except insofar as they are inconsistent with or violate the provisions
of ERISA or would result in a transaction prohibited by ERISA. The Trustees
shall not be required to give any bond or any other security for the faithful
performance of his duties under this Trust Agreement, except as required by law.
TWELFTH: Any Trustees acting hereunder may resign at any time at least
thirty (30) days after giving written notice to the Company, or earlier if the
requirement for the said written notice is waived by the Company. The Company
may remove any Trustee at any time by written notice delivered to the given
Trustee. In the case of the resignation, removal or death of any Trustee, the
Company may appoint a successor Trustee provided that the Company must appoint a
successor Trustee if at any time there is no Trustee then acting. The Company
may appoint at any time an additional Trustee to serve with the then Trustee.
Any Trustee so appointed and any successor Trustee shall have the same powers
and duties as those conferred upon the Trustee under this Trust Agreement. The
appointment of a successor Trustee and any additional Trustee shall be by a
written instrument delivered to the Trustee.
THIRTEENTH: The Trust Agreement, other than paragraph (A) of Article THIRD,
may be amended by the Company and the Trustees at any time or from time to time
and in any manner, and the provisions of any such amendment may be made
applicable to the Trust Fund as constituted at the time of the amendment as well
as to the part of the Trust Fund subsequently acquired.
FOURTEENTH: The Trust Agreement and the Trust Fund created hereby may be
terminated at any time by the Company. Upon such termination, or upon the
dissolution or liquidation of the Company in the event that a successor to the
Company by operation of law or by the acquisition of its business interests
shall not elect to continue the Plan and this Trust Fund, the Trust Fund shall
be paid out by the Trustees as and when directed by the Plan Administrator.
Notwithstanding the foregoing, the Trustees shall not be required to pay out any
assets of the Trust Fund until they shall have received such rulings or
determinations of the Internal Revenue Service or any other administrative
agency as they may deem necessary or appropriate in order to assure
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themselves that any such payment is made in accordance with the provisions of
law or that they will not subject the Trust Fund or the Trustees, individually
or as such Trustee, to liability.
FIFTEENTH: The Trust Agreement and the Trust Fund created hereby shall be
construed, regulated and administered under the provisions of ERISA and of the
State of Florida to the extent not preempted by ERISA. All contributions to the
Trustees shall be deemed to take place in the State of Florida. The Trustees may
at any time initiate an action or proceedings for the settlement of his accounts
or for the determination of any question of construction which may arise or for
instructions, and the only necessary parties defendant to such action shall be
the Company and the Plan Administrator, except that the Trustees may, if they so
elect, bring in as parties defendant any other person or persons.
SIXTEENTH: Any affiliates of the Company or affiliates which may be
affiliated with the Company in any way and which is now or may hereafter be
organized, may, with the approval of the Company, adopt the Trust if such
affiliate shall have adopted the Plan.
Any such affiliate may at any time withdraw from further participation in
the Trust Fund under the Trust Agreement with the approval of the Company. Such
affiliate shall file with the Trustees a document evidencing its withdrawal from
the Trust Fund and its continuance of a trust in accordance with the provisions
of the Trust Agreement as though such affiliate were the sole creator thereof.
In such event, the Trustees shall deliver to himself, as Trustee of such Trust
in accordance with Section 414(1) of the Code, such part of the Trust Fund as
may be determined by the Plan Administrator to constitute the appropriate share
of the Trust Fund then held in respect of the participating members of the Plan
of such affiliate. Such former affiliate may thereafter exercise in respect of
such new trust all the rights and powers reserved to the Company and the Plan
Administrator under the provisions of the Trust Agreement.
SEVENTEENTH: Any one individual Trustee acting singly is authorized to:
(A) open and maintain brokerage and custodian accounts in the name of
the Trust for the investment of Trust assets in securities;
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(B) open savings and/or checking accounts in the name of the Trust
with one or more banks and/or trust companies as depositories of the Trust; and
(C) sign checks, drafts or other orders for the payment of money from
said accounts; endorse instruments for deposit into said accounts and take all
other actions necessary in connection with all such checking or savings
accounts.
EIGHTEENTH: In the event the Plan Administrator appoints an Investment
Manager or Managers, as defined below, to manage (including the power to acquire
and dispose of) in accordance with investment guidelines established by the Plan
Administrator, all or any part of the Trust Fund, the Trustees shall have no
fiduciary liability for the acts or omissions of such Investment Manager or
Investment Managers or be under an obligation to invest or otherwise manage that
portion of the Trust Fund which is subject to the management of such Investment
Manager or Investment Managers.
An Investment Manager is any fiduciary other than a "Named Fiduciary"
(which latter term includes a Trustee of this Trust Fund) who:
(i) has the power to manage, acquire, or dispose of any portion of
the Trust Fund,
(ii) is registered as an investment adviser under the Investment
Advisers Act of 1940, is a bank as defined in that Act, or an
insurance company qualified to perform the services described in
subparagraph (i) above, and
(iii) has acknowledged in writing that he is a fiduciary with respect
to the Plan.
An Investment Manager shall direct the Trustees with respect to such powers
contained in paragraph FOURTH hereof which are delegated to the Investment
Manager by the Plan Administrator.
If there shall be more than one Trustee, the individual Trustees shall
jointly manage and control the Trust Fund unless the responsibilities,
obligations and duties of the individual Trustees are allocated by the
individual Trustees among themselves. In the event of such allocation, an
individual Trustee to whom such responsibilities, obligations and duties have
not been allocated shall not be liable either individually or as a Trustee by
reason of such individual Trustee's duty to jointly manage and control the Trust
fund
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for any loss resulting to the Plan arising from the acts or omissions on the
part of a co-Trustee to whom such responsibilities, obligations, or duties have
been allocated.
NINETEENTH: This Trust shall be known as the ROTECH HEALTHCARE INC.
EMPLOYEES PLAN TRUST.
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IN WITNESS WHEREOF, this instrument has been executed as of the day and
year first above written.
ROTECH HEALTHCARE INC.
By: /s/ Xxxxx X. Xxxxxx
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By: Xxxxx X. Xxxxxx
Title: Chief Financial Officer and Treasurer
BY: /s/ Xxxxxxx X. Xxxxx
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By: Xxxxxxx X. Xxxxx
Title: Chief Legal Officer and Secretary
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