Exhibit 10.6
TRUST UNDER
MORRIS COMMUNICATIONS
CORPORATION
DEFERRED COMPENSATION
PLAN
THIS AGREEMENT made this 7
th
day of July, 1999, by
and between Morris Communications Corporation (the
“Company”) and Institutional Trust Company (the
“Trustee”);
WHEREAS, the Company has adopted the
nonqualified deferred compensation plan(s) as listed in Appendix A
and expects to adopt additional deferred compensation plans that
may, with the consent of the Trustee, be added to Appendix A (each
referred to as a “Plan”);
WHEREAS, the Company has incurred or
expects to incur liability under the terms of each Plan with
respect to the individuals participating in each Plan;
WHEREAS, the Company wishes to
establish a trust (hereinafter called the “Trust”) and
to contribute to the Trust assets that shall be held therein,
subject to the claims of Company’s creditors in the event of
Company’s Insolvency, as herein defined, until paid to Plan
participants and their beneficiaries (or returned to the Company)
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;
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 meeting 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 Company hereby deposits
with Trustee in trust the amounts as determined as credited to the
individual plan participants and indicated in their respective
plans, which shall become the principal of the Trust to be held,
administered and disposed of by Trustee as provided in this Trust
Agreement.
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 Plan participants and general creditors as herein set
forth. Plan 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 Plan
participants and their beneficiaries against Company. Any assets
held by the Trust will be subject to the claims of Company’s
general creditors under federal and state law in the event of
Insolvency, as defined in Section 3.1. herein.
1.5. Within 15 days following the
accrual of benefits or deferral of compensation by a Plan
participant or other requirement under a Plan for the Company to
make a contribution to this Trust, the Company shall irrevocably
deposit additional cash or other property to the Trust in an amount
sufficient to pay each Plan participant or beneficiary the accrued
benefits or the required contribution pursuant to the terms of the
Plan.
1.6. The Trustee shall maintain
separate accounts (each referred to as a “Trust
Account”) for the benefit of each participant in each Plan.
All earnings attributable to or credited to each Trust Account
shall be maintained for the benefit of such Trust Account. The
Company shall designate the Trust Accounts to which each Company
contribution shall be credited.
ARTICLE II
PAYMENTS TO PLAN PARTICIPANTS AND
THEIR BENEFICIARIES
2.1. The Company shall deliver to
Trustee a schedule (the “Payment Schedule”) that
indicates the amounts payable in respect of each Plan participant
(and his or her beneficiaries) and each account maintained under
this Trust, that provides a formula or other instructions
acceptable to Trustee for determining the amounts so payable, the
form in which such amount is to be paid (as provided for or
available under the Plan), and the time of commencement for payment
of such amounts. Except as otherwise provided herein, Trustee shall
make payments to the Plan participants and their beneficiaries in
accordance with such Payment Schedule. The Trustee shall make
provision for the reporting and withholding of any federal, state
or local taxes that may be required to be withheld with respect to
the payment of benefits pursuant to the terms of the Plan(s) and
shall pay amounts withheld to the appropriate taxing authorities or
determine that such amounts have been reported, withheld and paid
by Company.
2.2. The entitlement of a Plan
participant or his or her beneficiaries to benefits under each Plan
shall be determined by 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 out in the Plan.
2
2.3. The Company may make payment of
benefits directly to Plan participants or their beneficiaries as
they become due under the terms of the Plan. The Company shall
notify Trustee of its decision to make payment of benefits directly
prior to the time amounts are payable to participants or their
beneficiaries. In addition, if the principal of the Trust Account,
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 falls due.
Trustee shall notify the Company where principal and earnings are
not sufficient.
ARTICLE III
TRUSTEE RESPONSIBILITY REGARDING
PAYMENTS
TO TRUST BENEFICIARY WHEN COMPANY
IS INSOLVENT
3.1. Trustee shall cease payment of
benefits to Plan participants and their beneficiaries if the
Company is Insolvent. Company shall be considered
“Insolvent” for purposes of this Trust Agreement if (i)
Company is unable to pay its debts as they become due, or (ii)
Company is subject to a pending proceeding as a debtor under the
United States Bankruptcy Code.
3.2. 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 Company under federal and state law as set
forth below.
(1) The Board of Directors and the
President of the Company shall have the duty to inform Trustee in
writing of Company’s Insolvency. If a person claiming to be a
creditor of Company alleges in writing to Trustee that Company has
become Insolvent, Trustee shall determine whether Company is
Insolvent and, pending such determination, Trustee shall
discontinue payment of benefits to Plan participants or their
beneficiaries.
(2) Unless Trustee has actual
knowledge of Company’s Insolvency, or has received notice
from Company or a person claiming to be a creditor alleging that
Company is Insolvent, Trustee shall have no duty to inquire whether
Company is Insolvent. Trustee may in all events rely on such
evidence concerning Company’s solvency as may be furnished to
Trustee and that provides Trustee with a reasonable basis for
making a determination concerning Company’s
solvency.
(3) If at any time Trustee has
determined that Company is Insolvent, Trustee shall discontinue
payments to Plan participants or their beneficiaries and shall hold
the assets of the Trust for the be
